FULL RECOMMENDATION
PARTIES : AER LINGUS DIVISION :
SUBJECT: 1.Covid Recovery Agreement: 1 Terms of Pay Freeze. 2 Permanent Reduction of Roster Duty Allowance (RDA) by 10%. 3 The Discontinuation of Excess Baggage Payment.. There is no dispute between the parties as regards the very significant impact of the global pandemic upon the Company and the membership of the Trade Union involved in this trade dispute in the period since March 2020. It is apparent to the Court that very significant engagement has taken place between the parties, including with the assistance of the Workplace Relations Commission (WRC), and that very significant progress has been achieved in the parties’ joint efforts to find agreement on the matters set out in the clarification document issued by the Company on 9thAugust 2021 and the document headed ‘Covid Recovery Agreement’which was dated 1stSeptember 2021. Agreement was not reached however between the parties in respect of The terms of a proposed pay freeze until the end of 2024. The proposed permanent reduction of RDA payments by 10% or agreement to an alternative cost saving that would achieve the same financial value. The proposed discontinuation of the excess baggage payment. Pay freeze. It is the Court’s understanding that a ‘pay freeze’until 31stDecember 2024 has been agreed with other groups of employees in the same terms proposed to the Trade Union before the Court. The parties are not disagreed as regards the proposition that there should be a period to end 2024 where no cost increasing wage claims will be pursued by the Trade Union. However, the Trade Union submitted that any agreement to such an arrangement should be reviewed if the company achieves profitability in the interim. The Company submitted that its losses have been so severe across the period since March 2020 that the impacts will be long-lasting rather than resolved upon the achievement of profitability. The Company position to the Court was that it would be agreeable to commence discussions on future pay movement in the second half of 2024 but if its balance sheet position was restored to 2019 levels as shown in the annual accounts at any time before then, discussions could commence earlier than mid-2024. The permanent reduction of RDA payments by 10% The Court understands that the proposal to reduce the value of RDA payments by 10% would affect only a minority of staff. The Court also understands that an agreement to permanently reduce variable pay has been reached with another group of workers and that the average effect of that reduction upon an individual is similar to the proposed average impact upon an individual affected by the proposal on RDA’s before the Court. The average gross value of the proposed reduction of 10% in the value of RDA’s to those who receive such variable payments is €15 pw approx. The Company submitted that the scale of the financial impact upon it is so severe that, while the members before the Court were the first group in the airline to achieve full restoration of 100% of pay, savings were required on a permanent basis. This had been accepted by other groups of employees. The Trade Union submitted that the impact of the proposal amounted to a cut in pay of between 1% and 1.5% to those workers in receipt of RDA payments and that a permanent reduction of this nature is significant upon the workers concerned while yielding relatively little in savings for the Company. Excess baggage allowance The Company has proposed that an excess baggage allowance in place in the airline be discontinued for those in receipt of same and that the allowance scheme would reviewed in the context of any future pay discussions. The Trade Union rejects the proposal to withdraw the allowance from those in receipt of same. It is the Court’s understanding that the allowance is in the form of a voucher payment of €390 per annum which equates in value to €7.50 per week to those in receipt of the payment. The Trade Union has submitted that an internal dispute resolution body recommended in 2016 that the allowance should be continued until such time as the parties agree on a new KPI- based system of reward. The Court has not been made aware of any cost saving measure agreed by any other group in the airline which would approximate to, or be similar in nature to the removal of the excess baggage allowance from those in receipt of same. Recommendation The Court takes particular note of the very significant level of agreement reached between the parties in local discussions and with the assistance of the WRC. The Court notes and has regard to collective agreements reached with other groups in the context of the current severe financial circumstances applying as a result of the global pandemic which impacted on the aviation sector with effect from March 2020 and continues to impact severely upon the airline. In the view of the Court there can be no doubt as to the importance, in the interest of both parties, of achieving a stabilising collective agreement in current circumstances. The parties’ commitment to achieve such an agreement is evidenced by the progress made locally and at the WRC to date in their negotiations. In those circumstances and having regard in particular to the written and oral submissions of the parties, the financial crisis being experienced by the airline which has had significant negative effects upon workers since March 2020 and the history of engagement between the parties, the Court recommends as follows: That the parties should accept the matters agreed in principle arising from their engagements on the clarification document issued by the company on 9thAugust 2021 and the document headed ‘Covid Recovery Agreement’dated 1stSeptember 2021 That the company’s proposal on the implementation of a‘pay freeze’until 31stDecember 2024 should be accepted with the understanding that discussions on future pay movement will commence in the second half of 2024 or, if the airline’s balance sheet position is restored to 2019 levels as shown in the annual accounts at any time before then, discussions will commence at that time. That the company’s proposal in relation to a permanent reduction in the value of RDA’s paid to those staff in receipt of such payments should be accepted. That excess baggage payments should continue to be paid to staff currently in receipt of such payment and that the scheme should be reviewed by the parties in the context of any future engagement on pay. The Court so recommends
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