PPRuNe Forums - View Single Post - IAG: BA restructuring may cost 12,000 jobs
Old 26th May 2020, 04:31
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TOM100
 
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UK employment law allows them to make significant changes to their roles, after consultation, and then re-hire on ‘new’ contracts/roles. In this case they are making, for example the legacy crew role (main fleet) redundant and are creating new roles that are (in the eyes of the law) different and with new Ts&Cs and due to significantly changed economic climate they require fewer people. So they can then rehire subject to some sort of selection process. This is entirely legal and happens all the time - if it were not the case, then by definition businesses would never be able to change.

LH have been bailed - but at a cost - the government now have a stake (with all that entails) and they are now subject to political interference and loss of existing shareholder value. I believe this is not what IAG want to happen and want to remain in control of their business and it’s destiny.

Assuming the German government (at least initially) want an arms length relationship (assuming the stake gets shareholder approval) with LH - LH will still have to right size the business to deal with the current state of the industry, which will mean redundancies - they cannot escape this reality I believe LH had balance sheet issues/weakness before this crisis (despite being profitable), IAG is in much better shape in that respect and hence more options within their own control.
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