BA pilots approve 2.6% pay cut

British Airways pilots have overwhelmingly accepted a 2.6% pay cuts as part of a package of measures to save the airline £26m (€30m), it was announced today.

The British Airline Pilots Association (Balpa) said its members voted by more than nine to one in favour of the pay cut, as well as a reduction of 20% in some allowances.

Balpa said the turnout in the ballot was 83%, with the result announced ahead of BA's annual meeting tomorrow.

The airline is seeking to cut thousands of jobs and freeze the pay of staff for two years to cut costs after making record losses of £400m (€462.1m) and facing a drop in demand for air travel because of the recession.

Jim McAuslan, general secretary of Balpa, said: "This is an unaccustomed position for a union to be in but we have pressure-tested the company's trading position and cost base and are satisfied that this step is necessary to help BA recover its position as one of the world's most successful airlines.

"Our members have backed that judgment and are leading the way in contributing to the turn-round plan. The package of measures will be implemented as soon as BA demonstrates delivery of the cost saving targets across the whole company."

Balpa said that as part of the deal, pilots would receive shares in the company in three years time worth £13m (€15m).

The cost saving package involves pilots taking a pay cut of 2.61%, a 20% reduction in certain allowances, as well as accepting some changes in operations.

BA workers will use live lemmings to protest at the firm's cost-cutting plans outside what promises to be a stormy annual meeting tomorrow.

Union activists will parade the animals in cages, with the slogan that the company and its staff deserve better than the way BA is being led.

Chief executive Willie Walsh has warned that BA was facing a fight for survival as he sought agreement on thousands of job cuts and a two-year pay freeze as part of drastic measures to save hundreds of millions of pounds.

As well as the lemmings protest, union members will hand out letters to shareholders as they arrive for the AGM in London on Tuesday, seeking their support for an agreement.

It was disclosed on Friday that cabin crew had offered to take a similar 2.6% pay cut and have no salary rise until February 2011 to help the airline.

Unite put forward the offer as part of a series of pay and productivity proposals which officials said would achieve "substantial" savings.

A deadline for agreeing about 3,700 job cuts and a two-year pay freeze as well as changes to conditions passed without a deal on June 30 and talks are continuing to try to break the deadlock.

BA workers held a series of meetings at Heathrow today to be updated on the talks and on the unions' attempts to help make savings.

Union officials will remind shareholders that BA posted record profits of £883m (€1.1bn) the previous year.

It was disclosed over the weekend that Mr Walsh had won backing for a potential rights issue from the firm's biggest shareholders.

One analyst said the airline could be forced to call on shareholders for up to £500m (€577.5m) to shore up its finances.