Impact: Aer Lingus cuts 'draconian and severe'

Up to 1,500 jobs will be cut and outsourced by Irish airline Aer Lingus as part of a €74m cost-saving programme revealed tonight.

The former state carrier plans to slash €50m from its payroll by axing ground and cabin crew posts.

After a two-and-a-half hour meeting with unions in Dublin, management announced it will also eliminate €14m from its bill for advertising, distribution, airport costs and professional fees.

A further €10m will be deducted from the carrier’s long haul services.

The Impact trade union desribed the proposals as draconian and severe.

“Impact will be consulting with its members employed at Aer Lingus before any further steps are undertaken,” said a spokesman.

The airline said all ground operations – including check-in, baggage handling - cargo and catering service will be axed at Dublin Airport and outsourced.

Shannon-based cabin crew and the mid-west airport’s ground operations and cargo services will go, while ground operations in Cork will also be cut.

Cabin crew bases in Heathrow will close, but the airline’s new Belfast hub is safe and will not be affected under the scheme.

Services from New York, Boston and San Francisco will be reduced and staffed with US-based cabin crew.

Aer Lingus will offer workers a voluntary severance or early retirement package, and those who do not take redundancy may transfer to a new service provider.

Employees who remain at the carrier will be hit with a pay freeze until the end of 2009 and will be given new contracts based on performance-related pay.

Aer Lingus has set a deadline of November 1 for the implementation of the programme.

Tommy Broughan, Labour’s spokesman on transport, said the job cuts were shocking and went further than people’s worst fears.

“Job losses on such a scale would mean that our national airline will be reduced to little more than a shell of its former self,” said Mr Broughan.

“What was once an international brand of recognised quality is now becoming just another low-cost airline.”

Fine Gael’s Fergus O’Dowd said Aer Lingus’s survival was critical for the economy.

“The survival of Aer Lingus is absolutely necessary to maintain a competitive airline industry in Ireland,” he added.

“However, the extent of the cost-cutting measures have understandably alarmed many working within the company. Management must make all efforts to find common agreement with its workforce.”

Aer Lingus announced last month it was reviewing operating costs after reporting losses of €22m for the first half of the year.

On Friday, the board of Aer Lingus insisted its cost-cutting programme was necessary to ensure the airline’s long-term viability and independence.

Airline boss Dermot Mannion tonight said management had “presented a radical cost cutting plan” to staff representatives.

It is not yet clear exactly how many jobs will be cut or outsourced from each airport.

But Siptu trade union hit back and announced it will ballot its members in the coming week for all-out industrial action.

National Industrial Secretary Gerry McCormack said the move by Air Lingus was Irish Ferries Mark II – when ferry staff were made redundant in 2005 and replaced with a cheaper workforce.

“It represents a fire sale of good quality jobs by a management that can see no further than the next quarter’s profit and loss sheet,” said Mr McCormack.

“Nobody in the company will emerge unscathed from this exercise. Even those who keep their jobs will have to sign up to new contracts, ”a merit and performance based culture“ and a pay freeze until the end of 2009.

“The company has also told us that it will continue to seek further savings so that surviving staff face the prospect of further reductions in pay and conditions, not to mention redundancy.

“We are perfectly willing to discuss savings with the company and will be entering the process to be chaired by Kevin Foley of the Labour Relations Commission.

“But, as we have made clear from the start, we are totally opposed to outsourcing. That message does not seem to have gotten through to the management team and therefore we are in the place we are in.”