BA plans 12,000 job cuts amid ‘fire and rehire’ move

British Airways has given thousands of cabin crew, ground staff and engineers less than two weeks to accept redundancy or reapply for jobs on substantially reduced pay. BA presented the choice to staff

in notices sent out last week after dismissing alternative proposals presented by union officials. The carrier aims to cut up to 12,000 jobs from a workforce of 42,000, with the Unite union accusing it of a strategy of “fire and rehire”. The airline has acknowledged it

wants cuts in basic pay of 20% and to amalgamate three cabin crew fleets on common pay and conditions. A BA spokesperson said: “We’re facing the biggest crisis in aviation

BA is retiring its 31 Boeing 747s with immediate effect

EasyJet pilots deliver verdict of ‘no confidence’ in management

history and have to accept we now have a very different future. If we do not adapt quickly our survival is not guaranteed.” Unions describe the redundancy

packages on offer as “modest”. However, political pressure on

BA is growing. A Unite petition calling for BA to lose its grip on landing slots at Heathrow has been signed by 150 MPs. Transport minister Kelly Tolhurst promised a review of the allocation of slots at Heathrow last month.

EasyJet pilots have passed an overwhelming vote of no confidence in the airline’s management over plans to cut 727 pilot jobs. More than 2,000 of the airline’s 2,300 UK pilots registered no confidence in easyJet chief operations officer Peter Bellew in the ballot organised by pilots’ union Balpa last week. EasyJet plans more than 2,000 job cuts in the UK. Balpa said the result “shows a

serious and widening rift between easyJet pilots and the airline’s senior management”. It criticised easyJet for “poor handling of the fallout from the coronavirus crisis and the collapse in pilot morale following Bellew’s appointment”. Balpa general secretary Brian

Strutton said “Pilot morale has collapsed. EasyJet is in a serious industrial relations mess. We have yet to see any justification for the scale of job losses easyJet has proposed.” The union has previously

warned the carriers’ proposals “could undermine key flight safety principles” after pilot representatives said they were told that those at risk of redundancy could be judged on their sickness record. EasyJet denied it would include sickness records among the criteria for selecting staff for redundancy. A spokesperson for easyJet

said: “We call on Balpa to focus on working constructively with us rather than on personal attacks.”

Virgin flies again after £1.2bn deal Ian Taylor

Virgin Atlantic resumed flying on Monday with a departure to Hong Kong after securing a refinancing deal worth £1.2 billion last week. The carrier will undergo a court-

backed restructuring based on a five- year business plan which envisages it returning to profitability from 2022. Virgin Group, which owns 51% of the carrier, and co-owner Delta Air Lines (49%) will provide £600 million in support. This includes £200 million in new investment by Virgin Group, raised by the sale of shares in Virgin Galactic, and £400 million in payment deferrals and waivers by Virgin and Delta, which confirmed it had written off $200 million on its investment. US hedge fund Davidson

Kempner Capital Management will

provide £170 million in new funding secured against Virgin Atlantic’s assets – chiefly slots at Heathrow. Davidson Kempner describes itself as a specialist in “distressed investments”. The airline’s creditors, including

aircraft lessors, have agreed “over £450 million of deferrals” on payments and Virgin Atlantic confirmed it “continues to have the support of credit card acquirers Lloyd’s Cardnet and First Data”. The card firms had been withholding payments from the airline. The restructuring will include

cost cuts worth about £280 million a year and the carrier will re-phase and refinance planned aircraft deliveries over the five years. The deal with creditors will

make use of a new court-sanctioned restructuring process under

the Corporate Insolvency and Governance Act which came into force on June 25. Virgin Atlantic chief executive

Shai Weiss said: “The last six months have been the toughest in our 36-year history.” Weiss reportedly plans to refocus

on the Caribbean and Israel until quarantine restrictions are lifted on US traffic. However, Heathrow flights to

New York and Los Angeles resumed this week and Virgin Atlantic has previously announced plans to restart services to San Francisco on August 1, Miami on August 18, Orlando on August 24 – from Heathrow and Manchester – and Atlanta on August 25. The carrier is cutting 3,150 jobs,

about one-third of the total, and has shut its operation at Gatwick.

23 JULY 2020 39

Virgin Atlantic is cutting 3,150 jobs

PICTURES: Matt Alexander; Richard Townshend; Shutterstock

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