In April 2002, pilots at Ireland's loss-making state-owned airline, Aer Lingus, looked set to oppose a set of findings on changes to working practices proposed by a jointly appointed independent arbitrator, but seemed likely to back a separate set of proposals aimed at resolving a dispute over 86 redundancies among pilots. The various proposals form part of a wider Aer Lingus survival plan.
Following the terrorist attacks on the USA on 11 September 2001, Aer Lingus, the Irish state-owned airline, was faced with a serious financial crisis, to which it responded with a survival plan of major restructuring and job losses, brokered by the Labour Relations Commission (LRC) (IE0111101F). Arising from this plan, two sets of proposals relating to pilots have been drawn up - one on changes to their working practices, and one aimed at resolving a dispute over 86 planned redundancies among pilots. In essence, the two documents are seen as a trade-off, with the pilots 'winning' on the redundancy issues and the company 'winning' in relation to the working practice changes.
The proposals on working practice changes, drawn up by a jointly appointed independent arbitrator - John Russell, a former personnel director at An Post- are one leg of the twin-track LRC settlement approach to resolving the redundancy and working practice issues. The separate, but related, set of findings on redundancy issues drawn up by a 'facilitator', Phil Flynn, is likely to be accepted by the pilots.
The vast majority of the company's former 6,000-strong workforce accepted the LRC's document on the survival plan late in late 2001. This dealt with issues such as redundancy, changes in working practices and a general pay freeze. Some 2,000 employees volunteered for redundancy, of whom 90% have already left the company.
However, the 530 pilots, members of the Irish Municipal Public and Civil Trade Union (IMPACT), agreed only to the pay element of the plan and threatened strike action over the redundancy and working practice issues. In April 2002, their hostile response to key aspects of the arbitrator's findings on change again raised the prospect of industrial action.
The company's position is straightforward. It has automatically accepted both sets of findings as it regards them as the culmination of the LRC's efforts to oversee a company-wide resolution of all issues arising out of its survival plan.
Aer Lingus will be mindful of Ireland's general election, which takes place on 17 May 2002, and will not want to run the risk of an industrial dispute so close to the election. Another problem facing management is how the pilots' rejection of the Russell arbitration document will be seen by the rest of the employees, in particular, the largest union at the airline, the Services Industrial Professional and Technical Union (SIPTU).
The Aer Lingus chief executive, Willie Walsh, speaking in Dublin after receiving an 'airline of the year' award from the Chambers of Commerce of Ireland on 29 April, revealed that the company is now 'cash positive' on a daily operational basis. Mr Walsh said that Aer Lingus expects to reduce losses in 2002 to EUR 27 million, down from the EUR 150 million it lost in 2001. The chief executive added that, while significant progress has been made, much remains to be done.