Aer Lingus has offered major concessions on redundancy payments and pensions to employees, in an effort to cut 2,500 jobs at the airline.
The revised package offers up to two years' pay in lump sums to workers with 39 years' service or more, instead of one year's pay in the original package.
It is also offering pensions to all employees with at least five years' service and who leave under the current plan.
SIPTU national industrial secretary Mr Noel Dowling has welcomed the move as "significant", but added that "given the magnitude of the job losses being sought it still falls short of what is required to attract the necessary numbers". He said the company should be able to meet the extra payments without breaching the £40 million limit on funds set aside for redundancies because the pension fund was in surplus.
Mr Dowling expressed concern at the lack of Government engagement with the situation. "In our view anything achieved in negotiations was no thanks to the Government," he said.
However, the Department for Public Enterprise said its secretary general, Mr Brendan Tuohy, had written to the European Commission seeking permission to pay extra compensation to airlines for losses following the September 11th attacks in the US. Most of this money would go to Aer Lingus, if the request was granted.
The new severance package provides four weeks' pay per year of service up to a maximum of two years' pay. It replaces the initial scheme that penalised older staff. Under the former arrangement, the most someone with 39 years' service could obtain was one year's pay.
In a further effort to persuade older workers to leave the airline, Aer Lingus is offering service-based pensions from age 55. The early retirement scheme is not as good as that under the Cahill Plan, which offered pensions from age 50, but it would still provide continuing income for those laid off. It is estimated that up to 370 people are eligible to take up the early retirement offer.
In a separate development it has emerged that the chairman of Aer Rianta, Mr Noel Hanlon, wrote to the secretary general of the Government, Mr Dermot McCarthy, last week, outlining his concerns about a new terminal being built at Dublin Airport by Ryanair or some other private operator. Mr Hanlon is understood to have reminded the Government that Aer Rianta is the statutory body responsible for the airport and expressed concern that any arrangement allowing a private company to build a new terminal for its own use could be deemed a form of State aid.
Today Ryanair is due to respond to a European Commission re- quest for a copy of the agreement between the airline and the Walloon provincial government covering Ryanair's operations at Charleroi Airport in Belgium.
The Commission wants to establish if funding provided by the provincial government to promote the airport constitutes a form of State aid to Ryanair.
The airline has lobbied the Irish Government for permission to build a terminal in Dublin - and the Minister for Tourism, Mr McDaid, is particularly anxious to promote any project that boosts tourism.