FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : AER LINGUS - AND - IRISH MUNICIPAL, PUBLIC AND CIVIL TRADE UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Doherty Worker Member: Mr Nash |
1. Company's Business Plan for Cabin Crew.
BACKGROUND:
2. The Union and Aer Lingus are in dispute with regard to the Company's Business Plan and the changes being proposed in the case of Cabin Crew. There are just over 1000 Cabin Crew staff employed with Aer Lingus. The Company's proposals envisage a range of changes in the arrangements which apply to the Cabin Crew. The following are a list of items in the Business Plan Agenda in Flight Services:-
- Productivity
- The 9th day
- Days off after transatlantic duties
- Pre 6am starts
- Duty following rest periods at outstations
- Single Night Stop - Los Angeles
- Six Sector Duties
- Duty Restrictions, day preceding Transatlantic Flights
- Crew Complements
- Overhead Savings.
The Business Plan proposals for Cabin Crew were discussed as part of the Labour Relations Conciliation facilitation process and were also subject of a number of conciliation conferences on 9th, 12th and 16th November, 2004. As agreement was not reached, the matter was referred to the Labour Court on the 26th November, 2004 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 2nd February, 2005.
UNION'S ARGUMENTS:
3.1 Many of the Company's demands particularly those which effect the Cabin Crew are entirely inappropriate and would run totally contrary to public policy which favours family friendly environments. The Cabin Crew workforce is a largely female one and changes which would reduce recovery time or time off would make the job which involves irregular hours and regular absences from home even more difficult.
2. The Union is prepared to involve itself in negotiations in a framework, which would provide for increases in salary for agreement on negotiated savings.
3. The Company accepted that the changes sought were not "normal ongoing change" and that they were major but insisted that they were not prepared to bargain.
4. The changes which the Company seek are well over and above what can be comprehended within Sustaining Progress and the Cabin Crew have apart from the normal ongoing flexibility, have contributed significant savings to the Company by reducing crew complements on many shorthaul flights.
5. The Company is making over €100million profits and will continue to do so. Any attempt to use the "competitiveness" agreement is rejected by the Union as it is clear that the productivities already contributed have succeeded in making the airline competitive.
COMPANY'S ARGUMENTS:
4.1 The Company has faced tremendous change over the last decade and on each occasion has risen to meet the challenge with the help of staff throughout the organisation.
2. Fare reductions in the overall Company business plan are required in order that the Company remains competitive and is able to attract passenger bookings. It is critical to the Company's survival that the cost-reduction programme outlined in the business plan is undertaken in all departments and on all cost lines, in order to fund the commercial strategy of lowering fare prices.
3. The Union has stated that they are prepared to negotiate on only one cost reduction element in the plan (crew complements) and that any change here will require pay increases above those in Sustaining Progress. This proposition is not one the Company is able to entertain as this would simply drive up pay cost lines already far above those of our competitors.
4. The Airline industry is regarded as one of the most dynamic and competitive and where financial failure is commonplace. This is due to a number of elements, including its inherently cyclical nature, high fixed costs, overcapacity and fiercely fought competition. A number of Airlines have demonstrated that with a business model built around attention to unit costs and low fares, survival and success are possible.
5. In the Summer of 2004, the Company launched a Voluntary Severance and Early Retirement Programme to its staff. 538 Cabin Crew expressed an interest. The Company therefore anticipate that any required headcount reductions would be achieved easily and solely via this programme. The cost reduction initiatives outlined are the Flight Services contribution to the overall costs reduction programme taking place in all departments of the Airline. Each department is following similar processes and negotiations in order to achieve these.
RECOMMENDATION:
The dispute before the Court relates to the Company's Business Plan and the changes being proposed in the case of Cabin Crew. The Company's proposals envisage a range of changes mainly in arrangements, which apply to crewing, time off and rostering and also envisage the withdrawal of some allowances. A list of items was referred to the Court.
The Union contend that the changes envisaged were not normal ongoing change under Sustaining Progress. However, the Union was prepared to enter into negotiations in a framework, which would provide for increases in salary in exchange for agreement on productivity and savings. The Union also stipulated that it was not prepared to conclude any agreement for increased productivity or change until the matter concerning "future employment"was agreed.
The Company outlined for the Court the cost saving measures necessary in order to ensure the continued viability of the Company in the current highly competitive environment, which exists in the aviation industry worldwide. It stated that the cost reduction initiatives sought are the Flight Services contribution to the overall cost reduction programme taking place in all departments of the airline. Each department is following similar processes and negotiations in order to achieve these measures.
The Court understands that a Facilitation Process chaired by Mr. Kevin Foley, Director of Conciliation LRC, is currently underway for various categories within the airline. The Central Agenda of this process allows for engagement on the issue of 'Reward and Recognition' for the changes envisaged in the Business Plan and the issue of 'Regular Permanent Employment Going Forward'.
The Court accepts the Union's contention that the changes envisaged by the Business Plan for Flight Services are not 'normal ongoing change' within the context of Sustaining Progress.
The Court notes that the Survival Plan of 2001 envisaged that the implementation of the PBS system would "undoubtedly deal with many of the items on the change agenda" and that many of those items are now included in the Business Plan of 2004.
Having considered the views of the parties expressed in their oral and written submissions, the Court recommends that bearing in mind the very significant competitive pressures facing the Company, that the parties should engage in negotiations within the framework of the Facilitation Process chaired by Mr. Kevin Foley. The Court recommends that every effort should be made by the parties to reduce the list of changes required to a more manageable list, this may be achieved by a combination of factors including acceptance and implementation of recently issued Labour Court Recommendations, etc.
If there are outstanding issues, which cannot be resolved through this process, these issues may be referred back to the Court for a definitive recommendation.
Signed on behalf of the Labour Court
Caroline Jenkinson
14th February, 2005______________________
JBDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jackie Byrne, Court Secretary.