ABOUT 300 jobs are to go on a voluntary basis at the Republic’s three main airports, and remaining staff will face pay reductions of an average of 5.5 per cent under a €38 million costcontainment deal reached between unions and management.
The agreement, which has to go to ballot early in the new year, will also involve the non-replacement of about 150 contract positions and the introduction of new work practices and reforms.
However, it contains provision for the pay deductions to be recouped and the existing pay levels restored provided the company meets profit targets over a sustained period.
Increments will continue to be paid to staff at the Dublin Airport Authority (DAA), which operates the airports at Dublin, Cork and Shannon.
However, the company has also signalled that it wants to appoint new staff on revised terms and conditions, in line with market rates.
The DAA said it was facing a €70 million earnings shortfall due to significant falls in passenger traffic and commercial income.
It said that the deal had been agreed at the Labour Relations Commission with officials from the trade unions Siptu, Mandate and Impact.
Under the graduated pay reductions, staff will face cuts of up to 12 per cent on the basis of current salary levels. However, those earning less than €30,000 will not be affected.
Informed sources have said that DAA chief executive Declan Collier faced cuts of at least 12 per cent.
The deal also provides for overtime rates to be reduced to time-and-a-half and for uncertified sick leave days to be cut back from four to two days. There will also be a pay freeze.
The agreement contains detailed provision on how the pay reductions could be recouped.
“Pay/Payments will be restored once the following thresholds are met: a.When the group achieves an average return on equity (ROE) pre-exceptional items of 4.75 per cent to 6.75 per cent (or if the group achieves €60 million profit after tax), a once-off lump sum to the value of 50 per cent of the employee annual contribution will be paid; b. Likewise if the group achieves 6.75 per cent ROE or above (or if group achieves €80 million profit after tax), a one-off lump sum to the value of 100 per cent of the employee annual contribution will be paid.
“Pay will only be restored by either 50 per cent or 100 per cent when the average ROE achieves a third consecutive year of either 4.75 per cent or 6.75 per cent or above respectively”, the document states.
The agreement document says that the DAA is facing a number of challenges, including the current financial crisis, the maintenance of sustainable levels of employment into the future, the elimination of inefficiencies, the requirement to operate efficiently the new second terminal at Dublin airport and the curtailing of escalating costs in the existing facilities in Dublin, Cork and Shannon as passenger numbers fall.
The agreement document says that the company believes that reforms and work practice changes are required to facilitate the departure of about 300 employees.
It said that these measures, in addition to the introduction of revised terms for new entrants, would put the company in a position to operate the second terminal and to curtail spiralling costs in areas such as Cork and Shannon “which cannot sustain further growth in payroll costs”.
“The alternative to this balanced approach is to buy in services more cheaply rather than carry them out with directly employed staff.
“This would inevitably see large-scale outsourcing and compulsory redundancy to reduce costs to a sustainable level and continue to provide passengers with the service levels required.
“If the savings and changes set out in this proposal are not agreed, then the company will have to reconsider its position in relation to these matters, not only in the medium term but in the short term,” the document additionally states.