Industrial dispute at national airline over breach of employee consultation law

In October 2007, the Local Authority Workers’ and Employees’ Trade Union and the Cyprus Airways Employees’ Trade Union submitted a request for mediation services in a labour dispute. The dispute concerns an ostensibly one-sided decision taken by Cyprus’s national airline, Cyprus Airways, to enter into an agreement with a private company in order to create a joint venture, offering ground and ramp-handling services at Larnaka and Pafos airports.

On 3 October 2007, a request for mediation services was submitted by the trade unions the Local Authority Workers’ and Employees’ Trade Union (Συντεχνία Ημικρατικών, Δημοτικών και Κοινοτικών Εργατοϋπαλλήλων Κύπρου, SIDIKEK), affiliated to the Pancyprian Federation of Labour (Παγκύπρια Εργατική Ομοσπονδία, PΕΟ), and the Cyprus Airways Employees’ Trade Union (SYNYKA), affiliated to the Cyprus Workers’ Confederation (Συνομοσπονδία Εργαζομένων Κύπρου, SΕΚ). The request was submitted to the Ministry of Labour and Social Insurance (Υπουργείου Εργασίας και Κοινωνικών Ασφαλίσεων, MILSA) in relation to a labour dispute over the allegedly one-sided decision by the national airline Cyprus Airways to enter into an agreement with Swissport/GAP Vassilopoulos (Cyprus) Ltd. The agreement concerns the creation of a joint venture seeking to obtain one of the licences for ground and ramp-handling services, to be awarded by the strategic investor at Larnaka and Pafos Airports.

Trade union objections

Specifically, SIDIKEK and SYNYKA contend that the actions of Cyprus Airways violated both the procedures laid down in the Industrial Relations Code and existing legislation – in particular, Law 78(I)/2005 establishing a general framework for informing and consulting employees. This was also noted by the ministry’s mediation service during the first mediation meeting held on 5 October 2007.

In addition, at a second mediation meeting held on 16 October 2007, the two trade unions questioned the breach of the bipartite agreement, according to which any actions not provided for in the restructuring scheme should be the subject of consultation between the trade unions and the company. In a letter dated 3 October 2007 to the President of Cyprus Airways, the two unions also refer to a study by an independent expert relating to the matter. Although this study was completed in early July 2007, the trade unions were never invited to engage in dialogue. In this context, apart from the collaboration between Cyprus Airways and Swissport, SIDIKEK and SYNYKA have also expressed serious objections regarding the content of the agreement – mainly Cyprus Airways’ share in the joint venture, which is expected to be slightly more than 25%.

It is a standing position of the two trade unions that the national airline must be the majority shareholder in any collaboration and that the offer of ground and ramp-handling services be used to boost Cyprus Airways’ efforts to survive. In this context, SIDIKEK and SYNYKA have expressed their willingness to collaborate with the company to find ways to further reduce costs and increase productivity. They stress that employees of Cyprus Airways have made sacrifices in the past, which were a basic factor in creating the conditions for the company’s recovery and survival (CY0501103F, CY0410102F).

Cyprus Airways offers assurances to staff

In an attempt to defuse the crisis, Cyprus Airways repeated its position on the matter in a circular issued to its staff in September 2007. In the circular, the company reassured its staff that all of the terms and conditions of employment, benefits and rights of those employed in the new joint venture would be fully safeguarded and that no cuts in existing jobs would be foreseen.

Threat of further action

According to SIDIKEK and SYNYKA, the company’s attitude – including the fact that it addressed a circular to its employees instead of bargaining and agreeing with the trade unions before entering into an agreement with Swissport – constitutes a breach of ethics, to say the least. As a result, they are calling on the company to suspend all steps taken with Swissport to date, at least until an agreement in principle is reached with the trade unions for the purpose of fully safeguarding the jobs and rights of employees at Cyprus Airways.

If an impasse is reached at the mediation stage, the trade unions have decided to respond forcefully in defense of their members’ interests.

Eva Soumeli, Cyprus Institute of Labour (INEK/PEO)

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