Major survival plan agreed at Aer Lingus

A €97 million survival plan has been agreed by management and unions at Aer Lingus. The ‘Greenfield’ survival plan includes voluntary redundancies, pay cuts, a three-year pay freeze, new rosters and new work practices. Cabin crew – members of the IMPACT trade union – had initially rejected the agreement. However, following bilateral talks at the Labour Relations Commission, the cabin crew voted again, this time in favour, after receiving ‘deeper clarification in certain areas’.

Provisions of restructuring plan

The annual results for 2009 for Ireland’s former national airline Aer Lingus showed an operating loss of €81 million. However, the airline’s restructuring plan ‘Project Greenfield’ proposed cuts worth €97 million, including total staff savings in the order of €40 million, for 2010.

The plan involves 676 voluntary redundancies comprising: 230 cabin crew; 100 pilots; 160 ground staff; and the rest in back office operations. In addition, there will be pay cuts ranging from 7.5% for those earning between €40,000 and €50,000 annually to 10% for those earning more than €50,000. Workers earning less than €40,000 a year will not have their pay cut.

A pay freeze until at least the end of 2011 has been agreed, as well as an end to long-held ‘legacy’ working conditions which the company says make the airline uncompetitive. The working week will also be increased by more than 1.5 hours.

Initial deal rejected by cabin crew

The deal was backed by Aer Lingus middle management, pilots, members of the Irish Airline Pilots’ Association (IALPA) branch of the Irish Municipal Public and Civil Trade Union (IMPACT), as well as members of the Services, Industrial, Professional and Technical Union (SIPTU), who are mainly ground staff but also some other workers. However, crew represented by IMPACT initially rejected the deal by two to one.

In response, Aer Lingus Chief Executive, Christoph Mueller, announced that 230 compulsory redundancies would be sought from the 1,300 cabin crew, but the airline would proceed with implementation of the cost-saving programme with the four other groups at the airline – pilots, middle management, ground operations personnel and aircraft workers.

He said: ‘There will be no sweetheart deal and there will be no re-balloting by cabin crew.’ A company statement said Aer Lingus would implement:

  • compulsory redundancies at statutory minimum levels, which would include cabin crew;
  • new working conditions to achieve increased productivity;
  • a new pay scale, including reduced salaries;
  • reduction in variable pay;
  • implementation of new principles of employment.

Cabin crew accept survival plan in second ballot

Bilateral talks between cabin crew representatives and Aer Lingus management were then held at the Labour Relations Commission (LRC). Cabin crew agreed to re-ballot on the original plan, on the basis of receiving ‘deeper clarification in certain areas’.

The airline said it had not altered any aspect of the plan, as to do so would have repercussive effects for the other four groups. The second ballot resulted in cabin crew accepting the survival plan by 92%.

Roisin Farrelly, IRN Publishing

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