Ryanair case crash lands spectacularly in the High Court
RYANAIR'S Michael O'Leary describes himself, with accuracy, as an "obnoxious little b****x".
Last week, in a startling (and so far under-reported) judgment, the High Court made findings about Ryanair executives that are far more serious than that.
Ryanair isn't just a company that makes millions from air transport - it's a massive economic and political presence in any country in which it chooses to operate. The High Court judgment of Mr Justice Thomas Smyth illuminates that company in a way not previously seen.
It was a small legal action - hardly more than a technical motion. It led, in the words of the judge, to the giving of "false evidence" under oath by two Ryanair executives.
Ryanair was a failing company in the early Nineties, then it studied and adopted the business model of a US carrier, Southwest Airlines. The policies of short haul, fast turnaround, secondary airports, no tickets, cutting frills, a single aircraft model (it cuts costs for spare parts and maintenance) all were taken from Southwest.
O'Leary modelled his publicity-hound image on that of Southwest's founder, Herb Kelleher.
One aspect of Southwest Airlines that wasn't imported to Ryanair was its relentlessly-friendly style. Instead of Southwest's slogan, "Spreading the luv !", Ryanair adopted a bullying manner and an often gratuitous aggression. When Belgian authorities demanded that Ryanair repay a couple of million euro, O'Leary's response was to write back with a suggestion that they "f**k off". It wasn't enough to sidetrack travel agents, O'Leary wanted to "take the f**kers out and shoot them".
O'Leary guessed that customers didn't care about abuse, as long as the price was right - and many do indeed find the aggression absolutely appropriate in this tigerish age. The company became huge. Assertions that Ryanair isn't as cheap as it likes to claim were drowned by a relentless stream of free publicity, as Clongowes old boy O'Leary played the anti-establishment rebel for an accommodating media.
Customers who sought a refund for one reason or another, were treated to O'Leary's response: "What part of 'no refund' don't you understand? You are not getting a refund, so f**k off".
The aggression, not surprisingly, carried over into staff relations.
From 1999, Ryanair began retraining pilots on bigger Boeing planes, the 737-800 instead of the 737-200. This led to an ultimatum to Dublin pilots. Ryanair would pay the ?15,000 cost of the retraining - but should "Ryanair be compelled to engage in collective bargaining with any pilot association or trade union within five years of commencement of your conversion training, then you will be liable to repay the full training costs".
If pilots didn't accept this offer, they would become redundant as the Boeing 737-200 was phased out. They had seven days to decide.
"It seems both irrational and unjust," Judge Smyth said, that pilots should be penalised to the extent of ?15,000 for the actions of third parties over which they had no control.
"In my judgment this is a most onerous condition and bears all the hallmarks of oppression."
In September 2004, pilots set up a closed website, Ryanair European Pilots Association (REPA). This is a forum within which pilots who are spread geographically can meet electronically to frankly discuss relations with their employer. A password is needed to enter the website.
Within three months, in the words of Judge Smyth, "some informer or traitor amongst the pilots" gave Ryanair the password. (The judge also used the words 'Iscariot or Iago' to describe the management-friendly pilot.) From December 2004, Ryanair has monitored the private discussion. And this led to the legal action that resulted in last week's judgment.
To maintain confidentiality, the pilots use pseudonyms in the website discussion. Ryanair wanted to identify the pilots. The company chose remarks made by a pilot - "considered slashing their tyres" - as the basis for a legal claim. The company alleged that this referred to pilots overseas who might accept the offer and move to Dublin. And this was evidence of intimidation. And Ryanair had a duty of care to its staff to investigate such threats.
So, Ryanair made a "sole discovery" motion, asking the High Court to order REPA to disclose the identity behind a number of pseudonyms.
Having heard the evidence, Mr Justice Smyth concluded that there was no threat or intimidation. A reference to slashing tyres was "weak adolescent street humour", quickly sidelined and withdrawn, in a private gripe among a staff suffering from frustration.
Judge Smyth quoted evidence of Mr Warwick Brady, Ryanair's Deputy Director of Flight Operations, that a Captain Gale "received warnings not to go back to Dublin to fly and be based there".
The judge found that this was one of two pieces of evidence from Mr Brady that "I consider to be false".
The judge was impressed by the pilot allegedly intimidated, Captain John Gale, who gave "clear, unequivocal evidence" that he "was never warned or threatened". After examining Ryanair's claims, Judge Smyth said he was "quite satisfied" that the alleged threats, intimidation and warnings "did not exist".
Judge Smyth rejected the evidence of Ryanair's head of personnel, Eddie Wilson, as "baseless and false".
He went further. "The pleaded concern and invocation of the statutory duties" to protect its staff from bullying and intimidation, "was to lend a facade of concern" to Ryanair's action against the pilots.
"It is a feigned exercise," he found, designed to divide the loyalty of the pilots.
RYANAIR swore on oath it wanted to investigate the identity of the pilots on the website in order to protect other staff.
"The real as opposed to the putative purpose of any investigation," said Judge Smyth, "was to break whatever resolve there might have been amongst the captains to seek better terms." And, in particular, "a very reasonable and justifiable concern" about the "take it or leave it" offer, which could cost the pilots ?15,000 each.
The judge concluded that Ryanair "is entitled to loyalty from its workforce, but not supine deference".
The High Court is a busy place. People queue to have the court rule on life-changing issues. And, Judge Smyth concluded from the evidence, a major company used the court in a "feigned exercise" to achieve its commercial ends.
And, he found, in the process, two of its executives gave "false evidence".
Judge Smyth (as judges are sometimes wont to do) quoted Shakespeare: "Oh, it is excellent to have a giant's strength; but it is tyrannous to use it like a giant."
Ryanair uses its giant's economic strength to demand best terms from those with whom it does business. It also uses its political strength. It is currently mobilising customers in Poland in a writing campaign to force the government to build a new airport at Modlin, north of Warsaw.
In Ireland, it regularly buys adverts attacking politicians (very sensitive people as elections loom) - always with a commercial end in sight. It has funded parties, including the PDs.
That powerful and politically-active company has been found to have mounted a "feigned" legal action under a "facade of concern" for its staff.
Questions arise: if two executives gave "false evidence" were they each engaged in a solo run? Or did they discuss their evidence? Was anyone else involved in such a discussion?
Are there any consequences for what the judge has found transpired?
Will Ryanair appeal? Will it accept the judgment and maybe even apologise for wasting the court's time in mounting what Judge Smyth called a "feigned" legal action?
Or will the company simply respond to the High Court with the same answer it gives to those of its customers who seek a refund?