British Airways - CC Industrial Relations Mk VI

[bermudatriangle]

Midman,you state Club seats are being sold for peanuts.may i direct you to BA.com and sourse club class fares to new york or sydney.i do not think you will find any fares on sale for peanuts!!
lots of miss-information is circulating at the moment,i suggest factual information is much more enlightening as to the real situation.

[617sqn]

I think that staff travel will be removed from strikers as punishment.
I think that if a strike goes ahead the costs would come off the cc budget.
It has been mentioned on here that the training costs for volunteers is coming off the cc budget.
the last letter from Bill Francis made it quite clear that the lost revenue would have to be repaid.
How that will be done will be quite scary.
I think it is in all our interests to return a no vote.

[LD12986]

Midman,you state Club seats are being sold for peanuts.may i direct you to BA.com and sourse club class fares to new york or sydney.i do not think you will find any fares on sale for peanuts!!
lots of miss-information is circulating at the moment,i suggest factual information is much more enlightening as to the real situation.

Club fares to New York are on sale for around £1,499 - that is cheap.

Also, you do not know what discounts BA has to offer to retain individually negotiated corporate contracts, some of which could be well below what is on ba.com.

Whereas corporate clients used to have deals with one carrier and agree a retrospective volume based rebate, many corporate clients are now shopping around and agreeing upfront discounts with different carriers for specific routes (Virgin for New York, SAA for Johannesburg etc).

[midman]

BTriangle,

They are being sold for far less than they were 2 years ago.

Club return to JFK for less than £1500 next month, less than £2000 to Houston is, I can assure you, peanuts compared to what they were being sold for then. Don't look at what it costs to fly there this week as an indication of the revenue generated in Club on those flights

Our business model is based on fares well in excess of what we charge at the moment - BA admitted this week that there are some club seats on sale for less than economy, in order to retain the business traveller.

I agree on the level of misinformation out there - I haven't seen a truthful fact from Bassa in the last 3 months that I have any knowledge of (genuinely).

BA however have to make statements that don't mislead the market, no matter how badly that fits with Bassa's view of the world.

[bermudatriangle]

LD,there has always been competition for corporate business,with private individuals subsidising the corporate accounts.thats true of any business,not exclusive to airlines,just look at what you pay for a car compared to fleet buyers.
airfares are rising significantly,load factors are increasing,all indicators point to a substantial recovery in the market.BA announces an operating profit,fact,only suppressed by interest payments and pension costs.
like it or not,the market is growing and return to profitability is far more likely than it was 6 months ago.
all i suggest,is that this puts the current potential industrial dispute in perspective.maybe a sucessful negotiated solution is now much more likely.

[LD12986]

LD,there has always been competition for corporate business,with private individuals subsidising the corporate accounts.thats true of any business,not exclusive to airlines,just look at what you pay for a car compared to fleet buyers.

I'm afraid it's the other way around.

Corporate clients are able to negotiate significant discounts because they provide suppliers with regular high volume income for a relatively low selling cost.

It's the big corporate clients that are the lifeblood of BA profits.

[midman]

Btriangle,

You imply that the pension payments, which along with other costs, have dragged us into a significant loss this quarter, are a temporary problem, and can be effectively discounted from the accounts to assess the financial situation of the company.

They are there until the state of the pension funds changes significantly for the better, and knowing the assumptions that the actuaries are required to use, you'll agree those pension liabilities are likely to weigh on the company's finances for years to come, I'm sure. Or do you think we can ignore them and just consider operating financial performance?

I'm interested in your opinion.

[bermudatriangle]

the BA board would be well advised to address...

Midman,i never suggested that the pension deficit is a temporary problem.the pension crisis is severe and has to be addressed,with painful consequences for all potential beneficiaries.all i stated was that the operating profit was extinguished by pension contributions and interest payments.the significant point was that the operation has once again returned to profitability,a very welcome development.
the issues of pension liability and interest payments are seperate and warrant specific measures to address the issues.
the BA board would be well advised to direct attention to the pension crisis,which is obvious to anyone,seriously outweighs any cabin crew costs.
it's BA's pension liability which concerns all potential investors.

[Sporran]

As a ground worker, and a member of Unite, said to me the other day -
"every other work group in BA have made savings and changed their working practices, except cabin crew! Why do they think they are so special?"
That from a ground worker!!

As much as I do not want to see the damage that a strike will do - I hope that WW goes the whole hog and confronts the selfish monster of bassa. The bassa 'reps' over the years have been a militant bunch on par with scargill and at long last there is a CEO who is not willing to be bullied by a bunch who's answer to every dispute is to vote for strike action.

[wiggy]

bermudatriangle

Does BA's announced operating profit,put the current negotiations in a new light?The fight for survival,seems to have elapsed.maybe the cabin crew do not now have to conceed so many benefits

Part of the reason for the return to operating profit is the cost saving agreements already made by Engineering, Pilots and other areas of the Company. Mr Walsh has always been adamant that all groups must meet their cost saving targets. IMHO for political reasons alone the CEO now has no choice but to make sure the Cabin Crew are seen to meet their cost savings in full.

[Entaxei]

As an outside view (ex enginering and now a PAX) and having followed this situation from the start, the comments made and questions raised about finance, profits, losses, pension situation, etc., rely as much on the interpretation, motivation and financial expertise of each individual poster, as to the possible results for BA., and have no real relevance.

The one thing that now stands out above all of this background noise and waste of breath is this ; BA cannot now afford to lose in any manner against BASSA, they have declared war against the management of BA and it is now a battle to decide who runs the company - if it is BASSA the company dies - no investor will be willing to risk their capital to a company run by such a group of incompetants - in any event any competant management would be out within hours even if the CAA would licence the resulting mess.

If, as has to be the expectation, BA management wins, there can be no prisoners, the aviation business industry, the worldwide primary safety and security zone today, cannot afford to take any chances, it will expect to see that every union activist, striker, etc., is driven out by BA, making full use of the police, and also ensuring action against anyone trying to intimidate and terrorise those that wish to carry out their work.

A maelstrom at present - but imagine how pleasant the working environment could be with all this idiocy and idiots removed and everyone able to work together. With the very best of wishes.

Cheers Entaxei.

[bermudatriangle]

Wiggy,of course the cabin crew have to contribute to cost savings.However,in view of the changed economic circumstances,the savings envisaged can be re-assessed,to reflect the true financial position.
Crew costs pale into insignificance when compared to the pension deficit.
The merger with iberia is subject to solving the pension crisis,not crew costs.
My view is that the merger is ill thought out,creating a third tier of board members at huge cost,the spanish economy is in crisis,with 20% unemployment.they are stuck with the euro,a currency that cannot be devalued to create competitivness.BA is big enough to forge ahead,the US is hell bent on stalling any merger with AA and the iberia deal is so misguided in my opinion.Focus on the core pension issue and embark on a positive network expansion and the airline will not go far wrong.the foundations at BA are magnificent,get the staff motivated once again and the future is assured.

[wiggy]

However,in view of the changed economic circumstances,the savings envisaged can be re-assessed,to reflect the true financial position.

So since the financial situation has changed do you think the CEO will let me have some of my pay cut back, and will some of our HKGs go back up to 4 pilots?

Crew costs pale into insignificance when compared to the pension deficit

Agreed, and as for the Spanish economy

[bermudatriangle]

Wiggy,i agree that long range sectors should have 4 crew operations as standard.perhaps now is the time to re-negotiate crewing levels.
don't forget the share incentive,if things continue on track,the pay cut will be more than compensated for.
i really believe tha the IB merger is misguided and as a company,BA are in a superb position to exploit the improved economic situation.
just get all the employees on side and work towards a clearly defined goal and the company is destined for success.

[wiggy]

Hi again bermudatriangle,

I think the crux of the matter is the internal politics.

Most of the workforce have bought into the idea that permanent change really is required and have negotiated cost savings. If the CEO now sends a signal that the Cabin crew are being "let of the hook" because they held out/said "No" for months on end all hell will let lose.

In addition he ( the CEO) will never have a better opportunity than he has now to break the stranglehold that BASSA has on IFCE.

I honestly don't see it being in his or the Company's interests to reduce the savings required from IFCE....

BTW I doubt I'll live long enough to see any benefit from the share deal.

[Diplome]

BermudaTriangle:

With all due respect, I don't see it playing out in any sort of kumbayah moment where BASSA and BA hold hands.

1. BASSA's conduct in this matter has been so egregious, so abusive, and so destructive to the well-being of BA's very existence that no reasonable CEO is going to now think that this is suddenly a union that can come to a table and negotiate as adults. BASSA had that opportunity and they wasted it with theatrics.

I am still convinced that there are many UNITE executives who would like to gag BASSA's leaders if only to keep them from doing more damage.

2. BA has not asked for any unreasonable contribution from Cabin Crew.

3. BA knows that public opinion stands overwhelmingly in support of BA and BA employees other than cabin crew. Why squander this opportunity?

4. You cannot separate BA's pension liabilities from its books and say "Oh never mind".

and finally the biggie..

5. BA is a for-profit corporation. It is not run simply for the basis of its employees, it also has to answer to its shareholders. Their ultimate goal is, as every successful company's is, to maximize profit while maintaining a healthy, happy and well-compensated workforce. It is NOT to just get by, it is obvious that their CEO and Board are determined that they will eventually be financially healthy.

It is common knowledge that BA Cabin Crew are the highest paid in the U.K., its common knowledge that they receive significant perks, over and above those received by other airlines. Adjustments in that department (as every other department has made adjustments) are to be expected.

BASSA have, in my opinion, misplayed their hand, recklessly so. If BA deals with this issue firmly, fairly and strongly to eliminate this incredibly inane idea BASSA has that they should be running the airline they not only make themselves more attractive to their employees, but also to investors.

I don't see an "Oh never mind" moment in BASSA's near future...though I could be wrong. BA's CEO's history tells me I may not be.

[Juan Tugoh]

long range sectors should have 4 crew operations as standard

This is not about pilot's terms and conditions but this is indicative of the mind set that is the problem here.

What defines a long range sector? Who determines what along range sector is? At present there are two issues here: safety and commercial requirements. The CAA determine what is a safety requirement eg the number of crew - flight or cabin required to safely operate the aeroplane. The extras on board are there for commercial reasons and they are determined OR SHOULD be by the company. There is a clearly defined set of instructions laid out by the Authority as to when 4 crew are required. The company can ill afford staff making up arbitrary and ill defined needs.

Just because the economy grew by 0.1% in the last quarter and anecdotally we can see full aeroplanes does not mean for a minute BA are out of the woods financially. Similarly the pension contributions the company makes cannot just be ignored or talked away. The company could make £500 million a year in "profit" but if pension contributions leave it in the red the company will still go belly up. Just like fue,l or pilots and cabin crew wages, company pension contributions must be paid.

Whether CC costs are insignificant by comparison the company still needs a permanent annual saving from IFCE of c£150 million. This is not a small amount of cash. The economy may be recovering but BA is still financially teetering. Make no mistake here, this is a fight BA simply cannot walk away from or back down from. The longer BASSA drag this out the more draconian the result will be. They could even win this round and have a party. All that will do is hasten the inevitable and horrible consequences of new contracts for everyone - take it or leave it. Just because the thread has moved a long way since the discussion of SOSR doesn't mean the spectre of SOSR has gone away.

The savings required of IFCE will be met regardless of the result of the court case, the strike ballot or the economic "recovery", either that or we will all be looking for a job and have no pension to boot.

[Diplome]

bermudatriangle:

Above you make the statement:

the pension crisis is severe and has to be addressed,with painful consequences for all potential beneficiaries

May I respectfully ask you what logical path you are using to state so dismissively that the pension can suffer (representing significant hardship to many employees) and that is acceptable, yet being asked to work one man down (and still well-within regulatory staffing requirements) is somehow worthy of BASSA and militant cabin crew wishing to bring the airline down?

[Litebulbs]

To be fair to the cabin crew community, they did not reduce the headcount in their department by 1000, BA did. That is a 1000 (well whatever the real figure is, if you take into account part time etc,) people that for no fault of their own, no longer work for BA. It was by imposition, which may or may not turn out to be legal, but a 1000 equivalent jobs have been lost. Is that not an emotive issue? Because of that, the remaining employees are having to work harder (no doubt people will ask harder relative to what?) and their is a spectre of a two tier work force at LHR.

Their is no doubt a huge potential saving to be made within IFCE, just because a percentage of that group are very well paid and BA would rather have that money in its own pot, than the employees and I am sure their are some senior management jobs resting on that redistribution of wealth.

In my opinion though, if that is worth anything, an awful lot rests on the court verdict and whether the various campaigns from staff and management, have managed to convince 50% +1 of the BASSA membership, that the reps were wrong.

I still can't see why BA did not reduce the service on board and then reduce headcount. That would have been a simple redundancy situation, less work, less people. That is what makes me think it was all or nothing and it is as big a gamble for certain figureheads, as Unite's all out opposition.

[Tiramisu]

To be fair to the cabin crew community, they did not reduce the headcount in their department by 1000, BA did. That is a 1000 (well whatever the real figure is, if you take into account part time etc,) people that for no fault of their own, no longer work for BA. It was by imposition, which may or may not turn out to be legal, but a 1000 equivalent jobs have been lost. Is that not an emotive issue? Because of that, the remaining employees are having to work harder (no doubt people will ask harder relative to what?) and their is a spectre of a two tier work force at LHR.

Litebulbs,
To be fair, the cabin crew community weren't forced to leave BA. It is through no fault of BA that the cabin crew who left, chose Voluntary Redundancy.

Most crew who left were ready to retire, and some of course had been waiting for severance for sometime, giving them the opportunity to do other things.

To be fair, most of us don't mind working harder. The product has been reduced to achieve cost savings, so the service is simpler thus requiring less crew and less time to deliver the on board product. The seats in the premium cabin are also half full. Realistically, we are not working that much harder.

I'm BA Cabin Crew and the above are my personal views and not those of BA.