Airline workers in line for £1,000 bonus

British Airways staff are poised for annual bonuses of around £1,000 (€1,500) if the airline improves margins sufficiently, it emerged today.

Up to 43,000 non-management workers stand to benefit from the scheme which is based on BA’s drive to double its operating margin to 10% – equivalent to 10p profit out of every £1 gained in revenue.

The plan – announced by chief executive Rod Eddington in BA’s weekly staff newspaper – comes as the company continues pay talks with unions.

Under the employee reward scheme, BA said bonuses would be triggered on a sliding scale once margins exceeded 6% – after accounting for the cost of the payout. At 6%, staff would receive one week’s pay or £500 - whichever is the larger amount - while at 10%, the maximum payout is two weeks’ pay or £1,000.

New “trigger” points for the 2005/06 financial year will be decided at the end of the current period.

Cost-cutting under the company’s Future Size and Shape programme resulted in an operating margin of 5.4% in the last financial year.

And earlier this year, BA set out plans to save a further £450m (€677m) through a reduction in external spending and £300m (€452m) in employment costs, including through changes to working practices.

Mr Eddington said: “Our operating margin for the full-year 2003/04 was 5.4%. We are about halfway towards where we need to be, thanks to the good progress made under Future Size and Shape.

“By continuing to work together we can continue to improve our operating margin to help secure our future. The new arrangements will allow all of us to share in our further progress.”