HomeNewsArchived Speeches and Press Releases

Statement by the National Implementation Body in relation to Aer Lingus


Statement by the National Implementation Body in relation to Aer Lingus

1.       The National Implementation Body has met with Aer Lingus management and unions to assess progress made on the process agreed with the parties in mid-November to address the issues which gave rise to and arise from:

-      the Labour Court recommendation (LCR 18850) and the parallel pilots’ process;

-      the non payment of increases due under the terms of Towards 2016 and other internal agreements; and

-        the achievement of PCI-07 or the equivalent savings for each of the parties.

2.       The Body’s consideration of this issue was informed by the outcome of the intensive discussions facilitated by the Labour Relations Commission, with technical assistance provided by Grant Thornton who confirmed that there is reasonable justification for the labour cost savings sought and noting the full engagement by the management and union sides with the process set out at paragraph 5 of the Statement of 16th November, 2007.

3.       The Body notes that:

a.                 the intensive negotiations on change facilitated by the Labour Relations Commission; and

b.                 the negotiations in relation to arrangements at Shannon Airport,

have resulted in the identification by representatives of Aer Lingus management and SIPTU of savings equivalent to those being sought under PCI-07 estimated to be of the order of €10m.  The Body recommends that the further engagement necessary to finalise the details of the flexibility/mobility agenda which has been developed and the Shannon issue should be concluded no later than end January, 2008. This recommendation is made on the basis that these negotiations will realise the savings identified above.  The conclusion of negotiations with SIPTU would leave a balance of the order of €10m to be found in respect of the remaining company workforce.

4.       In relation to Cabin Crew, the Body notes the savings through productivity or equivalent which are being sought under PCI-07. The Body recommends the urgent advancement of all outstanding issues arising from LCR 18850 and the process set out in LCR 18850 in particular in relation to the introduction of the Preferential Bidding System (PBS).  Furthermore, the Body recommends that the parties should commence immediately, as part of the construction of the PBS and outside any other context, an exploration of the arrangements necessary to support the introduction of the System.  Given the complex technical nature of these considerations the Body recommends that this work should be completed as soon as possible with a review of progress at end-January, 2008.

5.       In relation to Pilots, the Body recommends that current discussions, facilitated by the Labour Relation Commission, between Aer Lingus management and IMPACT / IALPA, including in particular but not limited to performance pay arrangements, should be brought to a conclusion no later than end-January, 2008.

6.       In relation to IAESA, the NIB recommends that the parties finalise agreement on all matters under discussion between them by end-January, 2008.

7.       As regards the Craft Group, the Body notes the substantial agreement between the Company and union representatives on matters arising from LCR 18850 and notes the confidence of both parties that outstanding issues can be readily finalised. The parties should engage so as to finalise agreement by end-January, 2008.

8.       The arrangements set out in relation to employees covered by the terms of paragraph 6 of the NIB statement of 16th November, should continue to apply until conclusion of the process set out at paragraph 9 below.

Future Recruitment and Grading Stuctures

9.       The Body also notes the concerns which surround the competitive positioning of the Company within the airline industry and the likely ongoing pressures in this regard.  The Body equally notes the concern of the unions to maintain core agreements on pay and terms and conditions of employment.  While material from secondary sources suggests that labour costs per Available Seat Kilometre (ASK) are out of line, further research is required to confirm the position definitively.  The results of this research should be used to advance the discussions on pay rates, conditions and grading structures for new staff.   In the view of the Body, the crucial factor, from a competitiveness viewpoint, is that unit labour costs should be consistent with airline industry norms and acceptable employment standards generally.  How unit labour costs are constructed offers scope to the parties for creative thinking to see if the objectives of the unions and management can be achieved within this competitiveness template.  The Body recommends that the relevant research and negotiations should be brought to finality within 3 months, so as not to impair the airline’s relative position.

Towards 2016and Other Increases

10.     In relation to payments due under Towards 2016, there are specific provisions in the Agreement for dealing with the non-payment.  

11.     The Body notes the unions’ position that non-payment of the increases due under the terms of Towards 2016 and the withholding of pay scale increments due under other internal agreements represent a breach of the terms of these agreements.

12.     The Body notes that the Company’s position is that until such time as the terms of PCI-07 or equivalent savings are achieved for a group of employees, a pay freeze will apply to that group of employees.  It further notes the Company’s position that agreements arising from the successful conclusion of the processes outlined at paragraphs 3, 4, 5, 6 and 7 would allow the immediate release of the withheld payments.


Future Relations

13.     The NIB would strongly support the recommendation set out by the Labour Court (LCR 18850) regarding the management of change through partnership, consultation and agreement at Aer Lingus; and the development of appropriate structures both to promote such an approach and to facilitate the speedy resolution of disputes where they arise.

21st December, 2007