| 9.4°C Dublin

Pilots deal could save 400 jobs at Aer Lingus

Up to 400 of the 1,065 jobs under threat at Aer Lingus may be saved if new proposals -- which would see 50 top pilots being let go -- are accepted.

The airline and its 470 pilots are close to agreeing a €30m reduction in operating costs by letting go 50 of the best-paid pilots.

This would result in annual savings of €15.2m, or an average of €302,000 per pilot.

The Labour Relations Commission (LRC) said the results of arbitration involving the two sides represented a "significant statement of confidence" in the troubled airline's future.

The LRC has also recommended that Aer Lingus establish a fund of up to €30m to distribute bonuses to all airline staff over a five-year period, once the company returns to profitability.

Throughout the latter half of 2009, Aer Lingus discussed ways of achieving the €97m savings that management said were needed by next year to keep the airline operating.

Management first proposed 676 job cuts from across its operations -- but mainly focused on pilots and cabin crew.

Talks between the company and unions broke down, but a deal was reached with cabin crew after further negotiations.

The pilots offered savings worth €30m, but management said the cost of the package was too high and that it had no choice but to ground aircraft and implement 1,065 job losses.

A final push was then made under LRC chief executive Kieran Mulvey, who enlisted Paul Jacobs, of Grant Thornton, to assess the financial implications of each side's proposal, then made proposals for achieving €30m savings.

Salary

He proposed that 50 pilots in the top salary band be let go, along with 26 on a different level, saving an extra €4.9m a year. Remaining pilots would take a 10pc pay cut.

The threshold at which pilots receive a performance-related payment will also be raised to save money. Other issues, including the pilots' pension scheme, remain unresolved.

mlavery@herald.ie


Privacy