Unions are unlikely to negotiate seriously on job cuts at Aer Lingus before they see what aid package the Council of Transport Ministers come up with in Luxembourg next Tuesday, writes Padraig Yeates.
Yesterday afternoon, financial advisers for SIPTU and IMPACT began poring over the books at Aer Lingus's head office in Dublin. Privately, senior trade unionists say it is a welcome breathing space while people await the outcome of meetings in Europe over the next few days.
The first such meeting takes place this morning, when union and employer bodies meet senior Commission officials to discuss the aviation industry crisis. This is part of the social dialogue process under the EU Treaty.
The 300,000-strong European Transport Workers Federation (ETF) and smaller European Cockpit Association, which represents pilots, will demand that any cutbacks in the airline industry are minimal - and are complemented with a retraining job creation programme for those let go. The employers are more fragmented, with five European federations representing major airlines, regional airlines, charter airlines, airports and civil aviation authorities.
However, unions and employer bodies will be largely united on one issue of vital interest to the Republic - the uneven playing field created by US government subventions to US transatlantic operators. The European Transport Commissioner, Ms Loyola de Palacio, will not have it all her own way. The competition and employment directorates will also be represented, and the latter will have to pick up the tab for any job losses incurred by Ms Palacio's "open skies" policy.
However, unions will concentrate immediate attention on next Tuesday's Transport Ministers' Council meeting in Luxembourg. Ministers are unlikely to want to hand over sovereignty and the right to make sovereign bilateral agreements with the US during the current crisis, simply to accommodate the Commissioner's agenda. What is more likely, and more worrying, is that they will, in the time-honoured way, long finger the whole issue.
Public Enterprise Minister Ms O'Rourke can be expected to use arguments already rehearsed in the Dβil this week about the Republic's unique reliance on north Atlantic air routes. Not only is Aer Lingus heavily reliant on north Atlantic traffic - so is Irish manufacturing and tourism.
Fifty-five per cent Aer Lingus's senior corporate business is in the high-tech sector, emanating from the US. In the current climate - with business and tourist seats on transatlantic flights empty - the airline can still fill its freight holds to and from Los Angeles.
Significantly, the Federation of Aerospace Enterprises of Ireland, which includes Ryanair and Cityjet in its ranks, supports the principle of state aid on the north Atlantic route, provided it is given on a non-discriminatory basis.
Its director, Mr Tommy McCabe, said yesterday: "The transatlantic routes are critical for Irish business. The Government needs to maintain routes. Because of US government support for its airlines, without adequate assistance for EU carriers there will market imbalance." Meanwhile, comments from European Commission sources that an airline would have to go bankrupt before receiving aid seemed aimed specifically at the Sabena situation.
Irish Government sources yesterday said Ms O'Rourke will be arguing "it is better, and cheaper, to take preventive action while the patient is still on a walking stick rather than in need of a life support machine". The guaranteed loans plan still seems to be the favoured Irish Government option.
Even if it receives backing for such an approach, it will hardly resolve the problems at Aer Lingus. The new senior management team, led by chairman Mr Tom Mulcahy, is perceived by the unions as pursuing "a bankers' agenda". So far, both sides have failed to even agree first principles for approaching the airline's problems.
The company has set financial targets and wants to cut the workforce to meet them. The unions want to explore various options to minimise the social impact of cutbacks. That translates into career breaks, job shares or early voluntary retirement packages rather than the highly targeted redundancies the company may want.
It is more cost-effective to slash the jobs of older, higher-paid workers, be they pilots, cabin crew or clerical staff, than abide by the union principle of "first in, last out". But any attempt to do so by the company will be to tempt a major confrontation.
The Cahill Plan worked because there was light at the end of the tunnel for most of the workforce. This time, so many employees feel threatened that securing agreement for 40 per cent cuts could prove impossible. There are also fears that redundancies on such a basis could lead to victimisation in a firm riven by bad industrial relations in recent months, not to mention much poorer working conditions for those lucky enough to survive the guillotine.
