TAP prepares for privatisation

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Over the summer and autumn of 1999, the privatisation process of Portugal's TAP airline has continued, with debate over future developments among the trade unions and the conclusion of a new agreement for pilots, which includes employee share ownership.

Transportes Aéreos Portugueses (TAP) is the Portuguese state-owned air carrier, and a member of the Qualiflyer group alliance of airlines. It has been in the process of being privatised for some time and, as has been the case with other similar Portuguese companies, the privatisation process has been accompanied by restructuring, with two key issues emerging:

• TAP will in future operate as separate companies in three areas of business - air transport, maintenance and baggage handling; and

• the company currently employs 8,700 workers, which it states is 2,000 too many, and management announced some time ago that it will be reducing the workforce. It is predicted that 1,000 workers who are near the age of 55 may be pensioned off. The unions are concerned about the type of employment contract that the new companies will offer to the workers, although the government has already given assurances that the system will be the same as that already applied at the National Airport Administration (Administração Nacional de Aeropostos, ANA).

TAP has various company-level agreements with different occupational groups. In the case of the pilots, after years of negotiating and numerous strikes over issues such as organisation of working time and salaries, in 1998 the parties resorted to arbitration to resolve their dispute over a new agreement (PT9804174F). The arbitration decision was issued in March 1999 (PT9904139F). However, some essential steps in order to make the decision legally valid did not took place. The partners involved in the dispute, the Civil Aviation Pilots' Union (Sindicato dos Pilotos da Aviação Civil, SPAC) and the company administration, the latter now under a new administrator, decided to return to the negotiating table and in June 1999 were able to come to a new agreement. Under the agreement, the pilots may end up holding between 10% and 20% of the new air transport company's share capital.

In addition to pilots having access to company shares, TAP's administration has also made reference to giving other workers the right to share capital in accordance with productivity gains. In other words, productivity gains will be transformed into share capital and distributed.

In September and October 1999, as the privatisation process continued, the various trade unions involved have made a number of criticisms, claiming that:

• dismantling of the company could lead to unemployment;

• in order for the company to continue to play the strategic role of a national airline and maintain services to the autonomous regions of the Azores and Madeira, as well as to Portuguese emigrant communities, public capital is needed; and

• the various categories of company employees - ground personnel and flight personnel - are not being treated equally with regard to the promise of access to company share capital.

The TAP administration has met with the various trade unions. The General Confederation of Portuguese Workers (Confederação Geral dos Trabalhadores Portugueses, CGTP), the Union of Aviation and Airport Workers (Sindicato dos Trabalhadores de Aviação e Aeropostos, SITAVA), and the TAP workers' commission have come out against privatisation, while the organisation of Social Democratic Workers (Trabalhadores Sociais Democratas, TSD) has expressed its concern over the problem of equitable distribution of share capital and the improvement of working conditions. SPAC, which agrees with the restructuring of the company, believes that the new form of partnership and involvement of workers in the company's production of wealth will provide a new direction for industrial relations behaviour.