
Controversy and Aer Lingus are never too far apart, particularly when it comes to cost saving practices and Unions. Aer Lingus have just announced plans to axe 1,500 jobs and plans to save €74 million annually. Details on the savings were not presented at the time of the announcement, but it is believed the company wants to shave €74million off current costs.
“[The cost reduction plan was]… a matter of urgency to deliver the substantial savings which are necessary to ensure the company’s long-term viability as an independent airline.” – Aer Lingus Board
Among the plans, Aer Lingus is set to outsource all ground staff at Dublin, Cork and Shannon Airports. Ground staffs include baggage handlers and catering staff and the move would see Aer Lingus virtually no longer directly employing ground staff in Ireland. Aer Lingus is also planning to outsource check-in staff, loaders and staff working in the cargo terminal. With regard to cabin crew, Aer Lingus proposes to close down its bases in Shannon Airport and London Heathrow Airport and in 2009 services to Boston, New York and San Francisco would be operated by cabin crew recruited in the US under revised terms and conditions. For staff remaining at Aer Lingus, a pay freeze would be introduced until the end of 2009 and new performance based contracts would be introduced.
“These proposed job losses… will effectively reduce Aer Lingus to a shell of its former self. Why should the people of the Midwest and indeed the whole western sea board have any confidence or loyalty in Aer Lingus when the company wants to shed its entire workforce who have for decades given loyal server to Aer Lingus” – Jan O’Sullivan – Limerick East Labour TD
Representatives from SIPTU, the biggest trade union within Aer Lingus met management on Wednesday (2nd October 2008) under the auspices of the Labour Relations Commission and told the company they will oppose outsourcing of any part of the application. Taoiseach Brian Cowen said recently he hoped the industrial relations process would provide a forum to enable management and staff representatives discuss the issues and come up with solutions.
“The company also reiterated its intention to implement significant cost reductions across all of its operations. Following the board meeting, meetings will be arranged early next week at which the company will outline the specifics regarding their cost cutting proposals.” – SIPTU
It is widely understood that Aer Lingus informed SIPTU and the craft unions that it was forecasting a substantial loss during 2009 and that the forecasted revenue streams for Aer Lingus had deteriorated badly in recent months. Stockbrokers believe that Aer Lingus could lose up to €40million this year and up to €90 million during 2009.
“The board has agreed the need for this fundamental change in the cost base to ensure that the company remains competitive and is appropriately positioned to take advantage of future growth opportunities.” – Aer Lingus
Gerry McCormack, National Industrial Secretary for SIPTU said the union will wait for further details on the cost cutting proposals, but the union will not accept mass layoffs by Aer Lingus.
It has now emerged that SIPTU sill analyse legislation introduced after the Irish Ferries controversy in their fight against layoffs at Aer Lingus. The legislation (Protection of Employment) came into force last year and allows an independent panel to consider whether redundancies as opposed to situations where existing workers are replace by lower paid staff. If this is found to be the case, the issue can be referred to the Labour Court. If the Labour Court finds that an exceptional collective redundancy situation exists but employees are dismissed in any event, it is open to the workers to claim unfair dismissal and possibly receive compensation of up to five years’ pay.
Under the legislation, a Union has to be in dispute with a company before it can seek to refer a case to the independent panel which would explain the decision by the union to ballot members immediately for all-out industrial action.
“The country is in recession and unemployment is rising. To export jobs during a recession is unacceptable, and we will fight any attempts to do that. That fight begins by talking with management.” – Christina Carney, Impact Union
Whatever the developments over the next two months, Aer Lingus is no stranger to strike actions and standing up to unions in recent times. Any proposed strike action will have devastating effects on the tourism economy in Ireland during this recession with hotels and car rentals at Dublin Airport service providers

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