Aer Lingus warns of compulsory job cuts

AER LINGUS has warned that it may have to introduce additional job losses – some possibly on a compulsory basis – if there is no agreement reached with trade unions on a controversial €97 million cost-saving plan before the end of the month.

In a statement issued following a meeting of its board of directors yesterday, the airline said its operating environment remained extremely challenging.

In this context, it said that if it the airline was to maintain its present scale of operations, it was essential that it urgently achieved the full €97 million in savings outlined in a transformation plan produced last month.

This reform plan involves more than 670 job losses at the company.

Aer Lingus had initially set a deadline of last Tuesday for completion of negotiations on the plan with trade unions. However, it accepted an invitation from the National Implementation Body to avail of the services of the Labour Relations Commission (LRC) in a bid to conclude an agreement.

The company said yesterday that, at the conclusion of the talks under the auspices of the LRC on November 30th, the board and management would meet to consider the results.

“In the event that the required €97 million savings have not been agreed in full, the board and management will proceed to implement an alternative means of delivering the savings within the same timeframe set out under the plan,” the company said.

“These alternative means will include further reductions in capacity resulting from an uneconomic cost base, which in turn will lead to additional redundancies beyond those included in the plan.

“While the preference will be for such redundancies to be on a voluntary basis, compulsory redundancies cannot be ruled out.”

Aer Lingus said its board would closely monitor progress at the LRC talks over the coming week.

The trade union Impact, which represents pilots and cabin crew at the airline, did not comment last night on the Aer Lingus statement.

Management and the Irish Airline Pilots’ Association will today discuss the proposed restructuring at Aer Lingus and pay levels when they address the Oireachtas Joint Committee on Transport.

Aer Lingus had net cash of €399 million at the end of September. This compared with €653.9 million a year earlier and reflected a €107 million charge for restructuring costs and payments for two new A330 aircraft.

The airline has struggled this year. Its revenues fell by 9.7 per cent year on year between July and September. The number of passengers was down 7 per cent to 3.08 million. Analysts expect Aer Lingus to lose more than €90 million this year.