Union resists proposed two-tier pay system for airline pilots

The former state airline, Aer Lingus, and the trade union representing the airline’s pilots are attempting to resolve a dispute over the right of the union to negotiate terms and conditions on their behalf. The dispute followed an announcement by the company that it intends to recruit pilots at a soon-to-be established base in Belfast. The trade union fears that a ‘two tier’ system will emerge between Aer Lingus pilots based in the Republic and those in Northern Ireland.

Dublin-based pilots at the former state-owned airline, Aer Lingus, threatened a 48-hour work stoppage, scheduled to take place on 21 and 22 August 2007. The pilots were protesting against the management’s refusal to abandon its plan to recruit new pilots at its impending Belfast base on new terms and conditions, without negotiating with the Irish Airline Pilots’ Association (IALPA) – affiliated to the larger Irish Municipal Public and Civil Trade Union (IMPACT). The work stoppage was narrowly averted due to the intervention of an independent consultant, Phil Flynn, who also acts as a pay arbitrator between the two sides. However, Aer Lingus Chief Executive, Dermot Mannion, estimated that the company still lost €3.5 million worth of business as a result of the dispute.

Transfer of service from Shannon to Belfast

The pilots are one of several groups with which Aer Lingus is looking for agreement in relation to its Programme for Continuous Improvement 2007, which aims to increase efficiencies and reduce unit costs. The threatened dispute competed for media headlines with the highly politically sensitive decision by Aer Lingus to drop its Shannon-to-Heathrow service, and transfer the valuable Heathrow slots from the midwestern region in the Republic to the city of Belfast in Northern Ireland. The Irish government, which retains a 25% stake in the company, has refused to intervene in the airline’s commercial decision. This is despite considerable pressure from the rival low-cost airline, Ryanair, which now owns over 29% of Aer Lingus.

Labour Relation Commission talks

Aer Lingus management and IMPACT agreed to attend the Labour Relations Commission (LRC) after Mr Flynn – who had been asked earlier in the year to make a recommendation on how both sides would proceed in the event of the company opening new bases outside of Ireland – stated that he had not been specifically asked about the Belfast base. The LRC discussions in turn paved the way for direct talks between both parties.

Company’s proposals

Aer Lingus wants to introduce pay scales at its Belfast base that would, at least in relation to the early points of the salary scale, be equal to or higher than the pay scales in the Republic of Ireland. For example, a captain pilot in Belfast would receive an annual salary of €113,000 on entry, while a first officer in the Republic moving to command an aircraft would receive an annual salary of around €98,000. However, a much shorter pay scale would apply in Belfast compared with the 16–17 point scale in the Republic. A health insurance package would be available in the North that is not available in the Republic. Moreover, the Belfast-based pilots would be offered a defined contribution (DC) pension scheme, and not the longstanding defined benefit (DB) plan currently available in the Republic. New flexible working arrangements are also being sought for the Belfast base.

Trade union demands

IMPACT insists that it should be involved in negotiating working conditions and is against any so-called ‘two-tier’ system of conditions. The trade union also fears that the company would seek to achieve similar arrangements in Dublin. While the union wants to represent the Belfast-based pilots, Aer Lingus management would like to negotiate with the UK union the British Airline Pilots’ Association (BALPA). However, IMPACT argues that it has a ‘spheres of influence’ arrangement with BALPA.

Among the proposals that the parties were expected to explore in the direct talks is finding some way of ‘ring fencing’ or securing existing terms and conditions in Dublin and perhaps ‘red circling’ the terms and conditions of pilots who want to transfer to Northern Ireland. A ‘red circled’ job means that it has been downgraded from its current pay scale; appropriate pay protection arrangements are then negotiated as compensation. Nevertheless, the company has made no provisions for Dublin pilots to transfer to Belfast.

Wider implications of talks

IMPACT also represents airline cabin crew who already have a UK base in London, and who are closely watching the outcome of the pilots’ talks. Their pay and conditions in London are close to those in the Republic of Ireland; however, the company considers that these could not be applied in Belfast as they are uncompetitive.

The other main union at Aer Lingus, the Services Industrial Professional and Technical Union (SIPTU), is also watching the developments closely. Once the company concludes agreements with the pilots and cabin crew, it must then turn its attention to SIPTU, whose members are spread throughout the airline.

Brian Sheehan, IRN Publishing