Unions split over Aer Lingus sell-off deal

UNIONS at Aer Lingus are split over a multi-million euro goody bag aimed at winning workers’ support for the company’s sell-off.

Neither of the two main unions have signed up to the deal yet but IMPACT said it was optimistic an agreement would be reached while SIPTU in contrast reissued its threat of strike action.

Details of the package emerged yesterday and include lump sum payments, pay increases, guarantees about future job numbers and measures to help plug a hole in the company’s pension fund.

It is estimated the deal is worth in the region of €250m to the company’s 3,600 employees over its lifetime but each employee is only likely to see a cash gain of between €400-€2,500 in the short term.

On top of that lump sum, which would vary depending on the number of years worked, employees would get a 3% pay rise over and above the national agreement but 2% of that would be lost in increased pension contributions.

The pension problem is a major stumbling block for SIPTU which is ideologically opposed to the sell-off of the State asset.

There is a shortfall of €170m in the pension fund and under the proposals, the company would fill just over €100m, leaving workers to make up the rest.

IMPACT, the largest Aer Lingus union with 2,000 members, also has concerns about the pension situation but has no ideological objection to privatisation

Michael Landers, IMPACT’s assistant general secretary, was pleased with the company’s assurances on staffing levels and outsourcing which would see the majority of employees given permanent jobs instead of seasonal contracts and no outsourcing undertaken until after 2010 at the earliest.

Another feature of the package is an offer to employees of a 7.5% share of future profits but SIPTU said it was not clear what would happen the employees’ existing 15% stake in the company.

“The issue is somewhere between the Department of Finance, the Department of Transport and the company,” said the union’s national industrial secretary, Michael Halpenny. “This whole “deal” is not a deal — it’s very much a work in progress. There are difficult issues to sort out.”

Mr Halpenny pointed out that the Government had not yet specified how much of its 85% holding it planned to retain following the sell-off.

Aer Lingus management had hoped to act on the flotation this month but negotiations have delayed the move which now has a target date of September. An Aer Lingus source said yesterday that negotiations with the unions were continuing.