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British Airways Cuts

British Airways sidetracks union involvement, cuts 1,000 cabin crew

Oct 06, 2009

LONDON - British Airways PLC. Tuesday said it is accepting voluntary redundancy from 1,000 cabin crew and allowing a further 3,000 cabin crew to switch to part-time work, a move that sidetracked union involvement.

But UNITE, the union representing cabin crew members, said it's unimpressed by BA's lack of communication.

A union source close to the talks said, "We've been working flat-out to find a negotiated solution with this company, but they are clearly not interested in compromise, preferring conflict instead.

"They are holding a gun to the heads of our members. We will not stand by while they push fewer and fewer people to do more and more work on less pay, and turn our premier airline into a low-cost operator."

The person added, "We cannot understand why the company did not use the opportunity of talks last week to table these proposals and [we] urge them to think again."

The cuts represent 1,700 manpower equivalent positions, or MPE, BA said. This takes it a step closer to reaching its target of 3,700 MPE cuts across the airline for the current fiscal year to March 31.

One of the results of the move is that BA will remove one crew member on each long-haul route from London Heathrow Airport. This won't affect the number of working crew on each flight, as senior cabin crew will now take passenger-facing roles.

It said while it has an extremely professional cabin crew, "we cannot ignore the fact that our Heathrow-based cabin crew costs are much higher than those of our Gatwick-based crew and of our competitors."

British Airways said in a statement it isn't currently profitable and expects to record a significant loss for the current fiscal year, the first time it will report a loss for two consecutive years.

"Revenues are down, so we must reduce costs to restore profitability," BA said.

Without changes, it will continue to lose more money and stressed greater efficiency is necessary "if we are to ensure our long-term survival."

Airlines across the world are facing difficult times, with travel demand faltering as a result of the economic downturn. The International Air Transport Association expects the global airline industry to post a $11 billion net loss for 2009.

BA has been hard hit by falls in its premium class where it makes a significant proportion of its profit, in particular from its transatlantic route.

It said thousands of employees across the airline have already made contributions to the cost-cutting program.

Engineers earlier this year voted to changes to their working practices, while pilots in July accepted a 2.61% cut in their basic pay from October and a 20% reduction in their allowances, as well an agreeing to other efficiencies including increasing their annual duty hours, all of which will save BA about GBP26 million annually.

In return they will be eligible to receive BA shares valued at a total of GBP13 million from June 2011 if targets are met.

"We have been talking to the cabin crew unions since the start of the year, but have made little progress on the contribution they might make," the statement said.

BA has consulted on these changes and isn't altering anything which requires negotiation. Changes will take place from the end of November.

The airline won't alter contractual terms and conditions for individual crew members.

BA currently employs about 14,000 cabin crew and continues its talks with check-in, administrative and ground staff.

British Airways sidetracks union involvement, cuts 1,000 cabin crew
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Source: Dow Jones Newswires

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