All Aer Lingus cabin crew to be made redundant!!

[Airbus321-200]

Aer Lingus has announced they will make all cabin crew redundant in one months time and they can re-apply for a cabin crew job on different terms and conditions if they want. Anyone made redundant will get the minimum payment as required by law which is 2 weeks per year of service.

Finally a CEO willing to make some major changes. I'm sure a stirke is on the way!

[newirishbabe]

I don't see any of the rest of the staff striking.

Christoph Mueller CEO has stated it would be unfair to penalise staff who had accepted the proposals, so why would anyone else in another department risk their own job for the turkeys who voted for Christmas. Aer Lingus lost €87m last year, and are heading for bankruptcy if something does not give. All other parts of the airline have agreed their cost cutting plans.

Wonder will you see redundant Aer Lingus staff applying for jobs in BA if WW goes down the same road????

[Evanelpus]

Aer Lingus has announced they will make all cabin crew redundant in one months time and they can re-apply for a cabin crew job on different terms and conditions if they want.

Whilst I think this type of practice is a crock of $hite, sadly it's becoming a more and more accepted one by employers. I have seen so many friends put through this situation, it's not pleasant, especially if they don't get their jobs back!

[EI Premier]

Aer Lingus lost €87m last year, and are heading for bankruptcy if something does not give. All other parts of the airline have agreed their cost cutting plans.Could you please explain how Aer Lingus are heading for bankruptcy. Having analysed the full year results, the Operating Loss for the full year was actually €81 million. Aer Lingus possess a significant amount of liquid assets that could be utilised to generate Cash Flow in the event of a Cash Flow emergency.

A profit was actually recorded during Q2, 2009. The outflow of cash in the past 18 months has been exacerbated by over €200 million because of Capital Expenditure in relation to new A330 aircraft, along with the once off severance deal that cost €96-€97 million.

The rate of cash burn has stabilisied significantly in the past six months.

[Airbus321-200]

And dont forget the approx. €600m cash EI have in the bank. Aer Lingus are far from bankruptcy. Actually their balance sheet overall is stronger than most legacy carriers. Here's the trading update :

Market News (http://www.ise.ie/app/announcementDetails.asp?ID=10402756)

[newirishbabe]

Any company that continue to lose money will eventually go bankrupt.

The fact is that Aer Lingus did have a significant loss last year and has to address that and not by selling off assets so as to continue to lose money but by increasing revenues and or reducing costs. This is what they are trying to do with the support of all their employee groups except CC.

Having a cash pile is no good if you are just loosing money, better off to shut up shop if thats the case,

[EI Premier]

Any company that continue to lose money will eventually go bankrupt.

The fact is that Aer Lingus did have a significant loss last year and has to address that and not by selling off assets so as to continue to lose money but by increasing revenues and or reducing costs. This is what they are trying to do with the support of all their employee groups except CC.

Having a cash pile is no good if you are just loosing money, better off to shut up shop if thats the case, Nobody disputes that Aer Lingus incurred a significant loss last year, but how many other airlines also suffered from the same issues that attributed to exceptional losses - quite a number in fact.

Increasing Revenue and subsequently profits is almost impossible in light of the current Macroeconomic environment. While an immediate reduction in the cost base is necessary, Aer Lingus are nowhere near bankruptcy. In fact, their Net Cash position remains exceptionally positive.

It's also a generalisation to say that all Cabin Crew are not supporting the moves towards a consolidation of excessive costs within the airline. Almost 38% of Cabin Crew voted in favour of the proposals.

[girtbar]

.....the airline that has a handful of pilots earning £20million between them. Damn i wish i had one of those contracts!

But meanwhile, in the race to the bottom, all the Cabin Crew will be on new T&C's which will be another step down from what they where before. Tis a shame really.

[Airbus321-200]

Christoph Mueller is clearing up Mannions mess. DM used EI like his own little project forcing ahead with stupid plans like the LGW base. The BFS i can justify more that LGW but it's still a mess and the IAD-MAD partnership doesnt fit the airlines model but CM is stuck with it. As CM said himself " the further away from Ireland EI goes, the less Irish it becomes".

The cabin crew have always been overpaid and had very favourable working conditions and now they are being brought back in line with other carriers.

[fjencl]

What happens when Aer Lingus make all there cabin crew redundant and in this process to many of them decide to leave......????

Will aer lingus be able to advertise for new cabin crew then ????

or what happens .....!!!!!!

[JayPee28bpr]

If all the crew leave Aer Lingus, they'll presumably recruit new ones from the 13.3% of the Irish working age population that is currently unemployed. I somehow doubt this will be necessary. Very few AL crew will not apply for their jobs, and remember the company wants to make almost 25% of its cabin crew redundant anyway. I doubt Mueller is worrying much about finding himself with too few crew right now.

[bnt]

The RTÉ News report (http://www.rte.ie/news/2010/0310/aerlingus.html) has more details on the new conditions, including this:
It is understood the annual working hours will rise from around 600 to 850.Does "working hours" refer to time on the plane only? I'm guessing this is the case, because when I worked in an office my leave was quite generous, yet I put in something like 1,800 hours per year. I estimate I had 6 weeks off a year, all told, so 40 hours a week, 46 weeks per year = 1,840 hours.

[PC767]

bnt. I believe it does refer to actual flying hours. The JAA allows crews to operate no more than 900hrs flight duty time in a rolling year, and a total of 2000hrs pa on all duties.

[on time all the time]

Am I stupid or are the figures released by Aer Lingus shadowing a reality which is not that bad. let me explain to you.
LGW was a stupid and costly mistake. We all at LGW wandered why EI wanted to enter an already overcrowded market in a period of deep economic crisis....and no one is accountable for such a stupid idea! Is the money lost at LGW not the same as the overall loss of EI...so does it mean that if there had been no LGW project Ei would have not lost money?
The second point is the 90 million Euros or so set aside for redundancy package... do that mean that if the money had not been spent laying off people, EI would in fact had made a profit?
Third point, I can't see how C/C could be dismissed and then hired again.If they refuse to sign a new contract, the airline is grounded. And once dismissed don't they have to go back to training, ID pass clerance....

[JayPee28bpr]

I can't see how C/C could be dismissed and then hired again.If they refuse to sign a new contract, the airline is grounded


Very true, except few, if any, will refuse to sign. Why? Because unemployment in Ireland is currently 13.3% and still rising. That's the equivalent of over 4 million unemployed in the UK. Meanwhile a large proportion of private sector workers still in a job have taken pay cuts, and every public sector worker has done so. And Mueller wants to get rid of 25% of the cabin crew anyway, so I rather doubt he's too worried right now about not having enough staff to crew AL's reduced number of flights.

[EI Premier]

Very interesting points being made above about EI's financial performance.

Firstly, with regard to the €97 million severance related costs from last year... These, themselves had no effect upon the overall profitability of the airline and were instead reflected in the reduction in both Gross and Net cash at the end of the financial period, although I'm not totally up to speed with the IAS covering this area. Aer Lingus will also have received a rebate from the Irish government of 60% of the statutory minimum of redudancy that was paid to all of the employees concerned under this scheme. However, as I understand it, this agreement equalled nine weeks pay for every year at the airline, so only about €7 - €10 million of the above cash burn would have been recoverable.

There is no departmental or base related splitting of Costs/Revenues in the Aer Lingus public financial statements, so it's impossible to ascertain whether LGW is loss making for Aer Lingus.

In relation to the Cabin Crew, I am of the opinion that the process of making all crew redundant is completely illegal and in contravention of legislation under the Terms of Employment (Information) Act, 1994. The positions themselves are not being made redundant and the skills required to complete the work won't be changing in the sense that crew will still have to go through the same exams every year. If Cabin Crew are going to be re-hired, Aer Lingus will have to prove that the nature of the work has absolutely fundamentally changed - which it won't have.

The current rate of umeployment in Ireland, seasonally adjusted is approximately 12.6% and C Mueller and Aer Lingus management will be artificially inflating this index during April if they proceed with this action.

On balance, regardless of the rhetoric from Aer Lingus management, I'm convinced that multiple aspects of the cost base are certainly overstated, especially in relation to the frontline / operational employees.

EI Premier

[YYC F/A]

EI Premier wrote: In relation to the Cabin Crew, I am of the opinion that the process of making all crew redundant is completely illegal and in contravention of legislation under the Terms of Employment (Information) Act, 1994. The positions themselves are not being made redundant and the skills required to complete the work won't be changing in the sense that crew will still have to go through the same exams every year. If Cabin Crew are going to be re-hired, Aer Lingus will have to prove that the nature of the work has absolutely fundamentally changed - which it won't have.

I'm still flabbergasted at the stunning announcement to fire and rehire the entire cabin crew team, not to mention not taking almost a quarter of them back in any event!

It is retribution through and through and no matter how you slice up your views on whether the cabin crew are in the right or wrong on the no vote here, I just can't see how this move by the company can be in any way legal.

And BA crew think it's bad.... ouch.

[Entaxei]

If you are running a company which is suffering from previous bad/weak management and belligerant/militant trade unions, the situation you are in must be one where current working practices are very restrictive, costs/salaries are high, the company is overstaffed and the trade unions are making/interfering with management control/decisions.

The only way forward is to restructure the company in all aspects - for this you need the understanding and assistance of the unions.

If the only response that you receive from the unions is threats, demands, and then a strike, what are the ways forward left open to you - surrender or fight.

Regardless of the legalities, fire the striking staff, offer to rehire - but cherry pick those that are - good at their job - not militant unionists, once employed remove the restrictive working practices and increase the wages, the cost savings will pay for it, allocate an amount to meet legal costs and awards to those staff who are not re-employed.

Cull your management team, don't use them on any union negotiation as they have already lost any authority on previous situations, promote new blood from within (if its available!), hire new human resources manager and director, new 2nd and 3rd I/C.

And so it goes on ..............

[PENKO]

All very well, but how can this be legal?
Can someone please explain that to us?

[Entaxei]

Firing the staff on strike would be illegal - but - as the union had not attempted to help the company and the staff had decided to strike - driving the company into an even worse situation - it is unlikely that a court would have any real sympathy with the union or strikers, would take into account the improved situation of those re-employed and therefore the company. The resulting individual court cases and payments awarded would take some time, possible years and, it is unlikely that the court would award a large amount.

For management, re-organisation of company and department structure, possibly a few early retirements, changes of responsibility, accurate performance evaluations, would take care the changes needed - all perfectly legal.

In creating more efficient ways of working, also ensure that staff in each department have more responsibility for their work seeing a job through from start to finish, this gives a sense of being part of MY company, having a pride in their work, the best providing an upcoming source of supervisors and managers. Always involve the staff in discussions re any changes to their operation, invite suggestions before laying out your ideas - they may surprise you with better methods, remember, they do the job - ALWAYS share cost savings.

[PENKO]

I will never get used to this Anglo-Saxon way of thinking regarding employment!

[Entaxei]

Don't worry, you're not alone - we're still working on it as well!! :ok:

[Clandestino]

You don't have to understand all the subtleties of Anglo-Saxon general theory of employment. Many a PPRuNer has noted its main points: labour costs are the biggest ones and need to be reduced, its better to have a job than to be on welfare (even if there's not much income difference between the two), unions are bad and if it weren't for them, CEOs would perform much better. Most important is that theory translates well into practice: countries that employ it are much better off in the current global turmoil.

Just compare UK and Germany :E

[Entaxei]

For fairness, the following must be said -

Unions are not automatically bad, there is a place for them in providing a focal help and representation point for staff, especially in manufacturing, provided that they fully understand their company operation, its marketplace and needs, they can provide new ideas to the company and work with it to the benefit of all concerned. The problem for the last XXX years is that the majority of unions have a political agenda which is their primary objective.

Working, rather than drawing unemployment benefit, is always better in providing a daily routine and interest that gives you the ability to project a good image in applying for another job - you don't stagnate.

Any CEO that cannot give a good performance because of unions needs replacing.

Labour costs are not always the biggest financial element, in manufacturing, stock, machinery, materials and facilities, can easily be the biggest element. Mind you aircraft and airport facilities don't come cheap!!.

Anyway - with best wishes for the future to all concerned and apologies for Thread creep. :ok:

[im1234]

It seems the dispute is resolved. Can't make out from the early headlines whether that means there's still CC job losses, and/or on what terms.
Cabin crew accept Aer Lingus plan - The Irish Times - Fri, Mar 26, 2010 (http://www.irishtimes.com/newspaper/breaking/2010/0326/breaking76.html)

Anyone know further details?

[bjorn14]

You have massively confused two parts of a business....the items you mostly mentioned are fixed capital costs not be confused with operating costs.

[ChicoG]

Any CEO that cannot give a good performance because of unions needs replacing.

Just what the (short sighted) unions always want. And look at the UK coal industry, car industry, steel industry when the unions refused to accept that their excessive wage demands had made their product uncompetitive.

Any CEO that can't stand up to crappy unions needs replacing.

[Entaxei]

If you are running a business, regardless of size, costs are costs, regardless of their origin. You obviously first tackle those that are easiest to control or reduce, or have the biggest impact on the negative cash flow. But at the end of the day if you ignore any major areas of spend, you do so at your peril. :ok:

[The Blu Riband]

230 Aer Lingus cabin crew who rejected a €97m cost reduction programme will only receive the legal minimum redundancy payment when they lose their jobs in a month's time.

All cabin crew will be made redundant after a 30-day consultation period.

Most of them will be offered immediate re-employment, but on lower pay and conditions.

Redundant cabin crew will get two weeks' pay per year of service, compared with six weeks in total for 440 staff accepting voluntary redundancy among pilots, administration, ground staff and craft workers.

Yesterday, the airline announced that it would have to secure cost savings through compulsory redundancies rather than by the voluntary deal that the cabin crew turned down by a margin of two to one.

It also said that it would not do any 'sweetheart' deal for the cabin crew, which was the only one of five groups to reject the restructuring agreement.

It is understood that the airline intends to make all senior cabin crew members, known as cabin managers, compulsorily redundant in an attempt to 'de-layer' the cabin crew organisation system.

The IMPACT trade union has said that the compulsory redundancy programme announced by Aer Lingus is 'brutal, targeted and unfair'.

The union is requesting that the Labour Relations Commission reconvene in order to 'find a mutual solution'.

In a statement this afternoon, the union says that despite assurances by the CEO of the airline Christoph Mueller, the measures 'look very much like a form of retribution against cabin crew for voting against the proposals'.

IMPACT says that it believes that the measures, if fully implemented, 'will damage the long term sustainability of the airline'.

Aer Lingus has said that it has no mandate from the board to enter further negotiations with cabin crew.

A spokesperson for Aer Lingus said that after four months in the Labour Relations Commission, there was nothing left to negotiate.



If I was crew I would be lobbying my reps incessantly for a negotiated settlement. Even if they are apparently temporarily indisposed.
Surely if these reps are suspended, or stuck downroute, they have MORE, not LESS time to attend union business; as they are claiming.

[ndbluemoon]

I thought that the Aer Lingus CC had voted in favor of the Company's cost saving
proposals on the second ballot taken. This is from IMPACT's website.

Result of ballot on cost saving measures by Aer Lingus cabin crew
Date: Friday 26 March, 2010
News Summary:

Aer Lingus cabin crew workers have voted in favour of a cost saving proposal on a second ballot of workers, following clarifications received at the Labour Relations Commission (LRC) last week.
News Content:

The total number of ballots returned was 828 (approximately 83%). The result of the ballot was 92% in favour of the proposals, with 8% against.
It is significant that this result was achieved through a joint negotiating process. Furthermore, the agreement was achieved without any recourse to, or threat of, industrial action at any stage of the negotiations.
Extensive bilateral discussions took place last week (Friday 19th March) at the Labour Relations Commission (LRC), which gave the IMPACT cabin crew negotiating team deeper clarification in a number of areas which enabled the branch to put the cost saving proposals of February 15th to another ballot of its members.
The cabin crew branch committee has said that they are very pleased with the outcome of the ballot. They said that the past few months had been a difficult time for cabin crew as they faced very significant cost saving proposals barely a year following similar proposals valued at €15million.
However, the committee said that they hope that this will mark the start of a new relationship with management which is based on the principal of mutual respect.