3,700 BA jobs on the line

BRITISH AIRWAYS    AVIATION INDUSTRY    JOB CUTS

Global - British Airways (BA) could axe 3,700 jobs to bolster the company's chance of survival, as it faces the "eye of the storm" in the airline industry, CEO Willie Walsh said.

Walsh told shareholders at the recent BA annual general meeting that costs must be reduced to keep the company viable. The proposed 3,700 job cuts, to be made by March 2010, would come on top of the 2,500 positions that have already been axed since last summer.

"There is no point trying to skirt around the fact that we need a fundamental and structural change to our employee cost base," Walsh said as trade union officials staged a protest outside the meeting.

According to the Canadian Press, thousands of BA ground staff railed against the planned job cuts and a possible two-year wage freeze, suggesting that the airline should focus on cutting costs elsewhere.

However, Walsh said "These changes are essential to our short-term survival and, more importantly, to our long-term viability."

Last month, the airline proposed to its 30,000 staff to work for nothing, for up to one month, in an effort to reduce the cost.

Martin Broughton chairman of BA reportedly told the Metro at the same annual meeting in London that the aviation industry was facing the biggest crisis it had ever known.

Broughton said BA, which employs 40,000 people, made an operating loss of more than £300million (US$493 million) in Q409.

"This is no ordinary aviation downturn. This is no cyclical swing that will automatically turn up again," Broughton said.

Outside the general meeting, members of GMB, Britain's general union and Unite union members handed out letters to shareholders calling for their support.

"We want shareholders to press the company to step back from confronting its workforce and to instead find a sensible way forward," said Steve Turner, a spokesperson for Unite.

The Press Association reported that BA workers were "disgusted" that their lowest paid employees at Heathrow Airport were asked to give up their family-friendly flexible working patterns and accept permanent change to their terms and conditions.

In addition, officials said low-paid workers were being asked to "subsidise" the 3,000 BA employees who were paid between US$188,000 and US$1.21 million annually, and the 1,000 staff paid between US$131,000 and US$188,000 who the GMB said had not been asked to make any alterations to their pay and share options plans. 

Negotiations over a potential deal have been left deadlocked, although the airline has called in a government-backed mediator to help hammer out a deal with the unions and avoid a potentially damaging strike.

Talks are expected to resume today.
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