A decision by Aer Lingus to reduce the commission paid to Irish travel agents from February 1st will cause the loss of 500 jobs in the travel agency business, according to the Irish Travel Agency Association (ITAA).
The state airline will have cut income on travel agents' ticket sales from 9 per cent to 5 per cent over the past 11 months.
In what he describes as a drastic decision by Aer Lingus, ITAA President Mr Tony Brazil said: "The ITAA have already met Aer Lingus eight times on this issue. We put forward a plan which contained a number of alternative and constructive proposals on measures that would have increased sales and cut costs. Unfortunately, Aer Lingus management has refused to negotiate.
"They will have no sales shops open and will rely totally on the web [for ticket sales]. We can’t see how this policy could succeed if we [ITAA] give them 80 per cent of their business".
According to Aer Lingus, the cut in commissions is one element of the airline’s overall cost-cutting strategy that sees a reduction in staff numbers of 2000, together with significant savings in overhead expenses and distribution costs.
In addition to cutting commissions, the airline’s distribution costs will be reduced by the closure of all Aer Lingus Travel Shops, a streamlining of its call centre operations and increased use of the Aer Lingus website for bookings.