Aer Lingus plans 70% wage cuts for some staff
Q&A: Airline pulled the plug on a deal on Monday. What does this mean?
Aer Lingus expects its business to shrink by 20 per cent next year, which would suggest about 900 job cuts. Photograph: Frank Grealish/IrishAirPics.co
What’s going on at Aer Lingus?
Aer Lingus last night told staff including ground crew and cabin crew, but not pilots, that it would be reducing their earnings by 70 per cent as a result of the substantial reduction in flights operating due to the coronavirus crisis.
Historically, pilots, who are represented by the Irish Airline Pilots Association (IALPA) negotiated separately to the group of unions representing other workers. IALPA declined to comment on the situation.
And where do pilots stand?
Well this is particularly egregious for some of the unions concerned. According to Siptu, which represents ground staff, after the deadline passed last night, pilots were given a “further number of weeks to consult their members and to conduct a ballot”.
“It now appears that this time line was arbitrary and artificial given that the pilots are being treated much more fairly than the grades represented by the Congress Group of Unions.”
Sources close to the pilots union suggested that the reason pilots are not included is because they’re paid monthly whereas everyone else is paid fortnightly.
Why is the airline taking such drastic action?
The story starts on May 22nd when Aer Lingus warned unions that if a deal on pay wasn’t concluded by June, the airline would unilaterally cut jobs and pay.
Unions took this to mean by June 21st, when the wage subsidy scheme was due to conclude (that has since been extended until the end of August). But the date was never specified by the airline.
Discussions continued over recent weeks and a draft agreement was circulated among the group of unions on Friday. Over the weekend, some unions, including Fórsa, decided to ballot their members because the deal constitutes a “huge change in circumstances”.
So had Aer Lingus staff been operating on full pay up to now?
No. They have been paid 50 per cent of their salaries and the deal the airline was seeking was that, if they continued to pay 50 per cent and staff worked less than 50 per cent of the time, the company could recoup the money for time not worked from staff. That was the deal that members were being balloted on. But this isn’t a short-term deal, this deal will continue up to February 2022.
It’s worth noting that the airline was availing of the wage subsidy scheme for some staff, The Irish Times understands. But they were topping up wages as the scheme did not cover the full extent of employees salaries.
If Aer Lingus offered the deal on Friday, why has it pulled the plug?
Unions decided to ballot members on Saturday and that process would have taken around a week, up to June 21st when they originally thought the process had to end.
Aer Lingus originally said it wanted to conclude the deal by June but, as noted earlier, a date was never specified and the unions were of the belief that the deal was to conclude by June 21st.
Last night, chief executive Sean Doyle told workers in a video message, issued after the 6pm deadline it had set, that because not all unions had accepted the Covid crisis recovery plan in time, its proposals were off the table.
Has Aer Lingus said anything else?
On Tuesday it told The Irish Times that the agreed deadline for acceptance of its plan was June 15th. “It had been agreed with the Group of Unions that the discussions would be structured such that the document would not need to be put to ballot. This was at the request of the Group of Unions.”
“It was never contemplated that the process would continue into this week, whether for balloting or any other reason,” the airline added.
Why are unions balloting members if the deal is off the table?
Unions are keen to get their members’ opinions on the deal and its worth noting that Fórsa wasn’t making a recommendation to members as to whether they should take the deal or not, rather they were suggesting that members make up their own mind on it.
They represent 1,400 cabin crew and have about 90 per cent of cabin crew in their union, so they’re a substantial player in this issue.
Is their a possibility of industrial action?
Fórsa was unwilling to speculate on whether there’d be industrial action “because we’re not talking about normal times”.
Remember, the vast majority of Aer Lingus’s fleet has been grounded as a result of the pandemic.
Only about 5 per cent of flights are currently operating, with the airline hoping to resume other services from July 1st.
Has Aer Lingus laid off staff?
The airline confirmed that it had communicated to fixed-term contractors in March that their planned appointments as permanent seasonal contractors was being deferred due to the crisis.
The airline has also previously said that it expects its business to shrink by 20 per cent next year, which would suggest about 900 job cuts.