British Airways dispute

I agree, BA are like BT,and Royal Mail.
These organisations all have outdated working practices which are heavily unionised.
The trouble is everbody wants something for nothing.
I feel sorry for all the Holiday travellers, many of whom have saved hard to make that trip to their relatives abroad. They cannot easily rearrange that "meeting".

Something needs to be done. BA are a good airline, with good staff.

I think this is another situation where managemant and unions should be locked into a room and not let out until they have come to an agreement.

Neither deserve any mince pies.!!!!!

I don't think BA are looking towards reducing current employees' salaries - only for new staff starting.

I understand the Unions being upset about not consulting, but nevertheless BA have got to do something pretty sharpish to control their costs - a £292M loss and a £3.2Bn hole in their pension fund needs them to act and IMO is't open to negotiation, with all the delays that implies.

Looking at what other airlines pay & their working practices isn't relevant to their current situation.

I so admire Walsh; running an airline AND being an X-factor judge...

He is also very cunning; refuse to negotiate, and impose a deal at a time that ensures that if the Unions want to take industrial action, it will HAVE to be taken over the Christmas break.

Naturally this makes BA the good guys, Unite / Crew the bad.

And taking strike action during the Christmas period doesn't also suit the Unions and put extra pressure on the BA management? Why do they HAVE to take action over the christmas break anyway?

AIUI there is a time limit when taking action against something an employer has done. Walsh could have waited until january, which would not really have affacted anyone.

He chose not to.

I believe the time limit is 28 days, but anyway I don't believe BA have yet imposed these new T&Cs so the Union's got more time than this to legally take action.

The directors of BA have a statutory duty to protect the interests of the company and in the circumstances a delay would not be very sensible.

Whether BA has unnecessarily delayed taking this remedial action I can't say.

Listening to R4 earlier I think BA have imposed the T&Cs.

I recall hearing that the BA Pension Director took her £200k bonus this year.

quote:

Originally posted by Mike Lacey:
Listening to R4 earlier I think BA have imposed the T&Cs.

I recall hearing that the BA Pension Director took her £200k bonus this year.

You have to pay for doing such a good job, vast profit etc ...oh shit!!!!!
We'll have less staff and pay the remainder less that'll make up for it.
Same old same old.

The Telegraph mentioned the ABBA syndrome.

Anything But BA, which I think is very sad. Well those who have booked and will miss their planned flights will add to it.

Even sadder, but possibly it may be viewed as reasonable.

Shame on the whole caboodle, IMO. Suicide indeed.

ATB from George

Up until recently, BA were doing well - the company had been turned around. I've got no problem with people being paid £200K if they've met their individual targets and have been promised such renumeration. Companies of the size of BA need to pay high salaries, it's a fact of life.

I'm not entirely sure they've changed their T&Cs anyway - these wouldn't state numbers of cabin staff needed on long-haul flights, nor renumeration for new starters.

Having flown with United (not a great airline i'd be the first to admit!) for a number of years of working (and living) in the US i recall the grace with which United staff accepted the measures which were put in place to rescue the company after they 'filed Chapter 11'. They accepted that the company they'd invested significant years of their lives into was in trouble, and that they had to be part of the solution.

BA are in serious trouble. If they're to return to profitability a number of measures will need to be taken, across the board I might add, to reduce their cost base. They're a huge Goliath to Ryanair's David.

I can't pretend to have read the in's and out's of this particular issue, however what's reported is often hugely partisan depending on which 'wing' the reporting medium sits (apologies!). Generally of course, left wing media supports the Unions, right wing, the management, so i don't feel that reading into it will prove massively enlightening.

What I will say is that I find Union behavour quite disturbing at times like this. Ultimately what's best for the BA staff equates to what's best for the company. That amounts to a sacrifice, if necessary, in order to help balance the books.

Before the inevitable backlash, i'll repeat my comment above that such measures should be taken across the board in order to have the desired effect. What many unions neglect to mention is the huge imapact small changes in the salaries of the lower paid masses have on the books compared with seemingly large but relatively insignificant renumeration packages of the few at the top. Our economy works in much the same manner.

Light the blue touch paper......

Phil

Presumably....if Walsh and his team of directors and senior managers had FIRST taken a 90% cut in remuneration......

....the cabin crew (new and old) would be morally forced to take a 50% pay cut and accept fewer crew per flight?

No doubt Walsh had a good reason for not following this idea?

Cheers

Don

Not a realistic scenario, and why should the senior management have a 90% cut rather than a 50% cut anyway? Far more effective is for everyone in BA to take a 3% cut.

Tony,

The exaggeration was deliberate. The whole situation is unreal.

Presumably Walsh knows that imposing a large cut in personal wages and a cut in staffing levels, without any sign of similar (or greater) cuts at director/senior management level, he was spoiling for a fight?

people, quite understandably IMHO, get pissed-off when this sort of thing happens, even if the rest of the airline industry is mimicing Ryan Air wages and staffing levels.

Of course, why he didn't figure out the "across-the-board" cuts in remuneration and manpower needed to get costs down to sustainable level (3% or whatever) and apply them more or less evenly across the business....well, I get the impression you agree. if he can't cut 2 pilots per flight, he could cut their wages by a futher 1/13 or whatever. Ryan Air pay c.£40ph with no guaranteed minimum flying hours, so not much chance of pilots re-locating.

Cheers

Don

Some interesting numbers from BA accounts 08/09 here:

http://www.britishairways.com/...ites/ba_reports0809/

Staff numbers 42,000

Total employee costs £2.193 billion

Of the costs of running BA, this is second only to Fuel and oil costs at £2.989 billion

This gives an average salary of approx £52,214, (however we have no idea what the distribution is here).

Clearly fuel and oil costs (variable) are external to the company, and difficult to control given world markets.

What companies therefore need to do in circumstances such as these is to control fixed costs, ie those which they have an ability to control.

There is therefore significant merit in not awarding a pay rise, or freezing pay, etc. An example is not uplifting the salary bill by 4% for the next FY, which would result in savings of £87.7m.

Now Willie Walsh appears to be on a salary of £726,000, with taxable benefits (company car, fuel, private health insurance etc) of £17,000.

The board of directors total salary bill is approx £1.9m (11 individuals including Walsh). You could halve that and still not make much of a dent in the £87.8m saving if you freeze pay for all staff.

So all this talk of 'greedy fat cats with their huge salaries bleeding the company dry', which we've also heard recently in the recent post office debate, flies in the face of the numbers, which show that the board reducing their salaries, even by large percentages, would have little effect on the profitability of the company. Any such gross reductions in director salaries would therefore amount to a 'token gesture', or a 'show of solidarity with the workforce' at best. Perhaps staff are sufficiently ill-informed, or shallow, to think that this would save the company? Perhaps also they're sufficiently self absorbed to believe that the company is all about them, and that they 'deserve their 4%' regardless....

Food for thought.

Phil

quote:

Any such gross reductions in director salaries would therefore amount to a 'token gesture',

No! It would show leadership! Sadly lacking in some places.

I also suggested a 90% cut at director level. Tony says this is unrealistic. Why? BA could easily get 11 more effective directors than the current crop at £100k pa each. Contoversial?

cheers

Don

quote:

Not a realistic scenario, and why should the senior management have a 90% cut

Because they are useless? Seems a good enough reason to me

Very few senior managers merit what they are paid in my experience - I always think that when a company thinks of outsourcing then outsourcing the roles done by senior managers to a more cost effective organisation is a good place to start. It doesn't mean they are not nice people, some are and some aren't, but lots of them are just not very good - the banking fraternity has many examples.

As an experiment could we ask all senior managers to stay home and they'll get a call if they are needed at work or if things are breaking down ... no call for month and .... I'd be happy to give it go.

- the Golgafrincham Ark Fleet, Ship B of Douglas Adams’s ‘Restaurant at the End of the Universe’ comes to mind.

I hope people don't mind me putting a BA insiders view about this dispute - although I am not a manager.

BA crew have not had a pay cut or been asked to take a pay cut (except by the Union which voluteered it's members to take a 2.5% pay cut which the company rejected as it wanted to protect the crew's pay).

There have been no forced redundancies for cabin crew, but those who asked for part time work and voluntary redundancies have now been given it.

The crew on some flights has been reduced by one, this means the senior crew member on board a 747 (a CSD) now has to push a trolley and help with a meal service. I am married to a long haul CSD who states this is perfectly managable and has not had a real effect on the passenger experience.

So what is the dispute about? The changes were "imposed" on the crew. After several months of talks with the management - which included the union walking out of a meeting because a member of the rival union was present, walking out of ACAS because they were not willing to listen to a presentation on the company's finances prepared by the management team and going months past the deadline date set by the management - with the company losing over a million pounds a day - the changes were "imposed". I understand the crew are also upset that the prices in the heavily subsidised canteen have also been put up.

I speak from inside knowledge and say that my partner earns in excess of £60000 a year as cabin crew (he is one of the top earning CSDs).

Is strike action justified? I will leave it to you to judge.

quote:

I speak from inside knowledge and say that my partner earns in excess of £60000 a year as cabin crew

Worth every penny if they have to put up with passengers like me - I hate flying.

Thanks for that FlyMe...in that context it sounds like the unions are being unreasonable.

Nevertheless, the actions of upper management do have a bearing...they need to show willing to pull in their belts, if folk are being squeezed elsewhere.

I agree Matt - I think any strike in any industry must reflect some degree of management failure.

quote:

BA crew have not had a pay cut or been asked to take a pay cut

I understood they want to reduce cabin crew basics from c£24k to c£12k, but only for new starters?

perhaps the newspapers have made some sort of mistake this time round?

Cheers

Don

quote:

Originally posted by Phil Cork:
Some interesting numbers from BA accounts 08/09 here:

http://www.britishairways.com/...ites/ba_reports0809/

Staff numbers 42,000

Total employee costs £2.193 billion

Wages and salaries £1.389 Billion

BA Wages

You are right Don - but the ballot for strike action was about the imposition of the reduced crewing levels.

There seems to be a lot of confused thinking amoungst cabin crew as to what this dispute is actually about - I don't think the law allows you to strike about what might happen in the future.Certainly if BA is to survive it is going to have to reduce it's cabin crew wage bill some how.

Although basic pay rates are very low the allowances and expenses system (which is not subject to full UK tax) means that take home salary looks very different to basic pay. The problems then come when you are sick or retire....

quote:

Originally posted by Don Atkinson:

quote:

Any such gross reductions in director salaries would therefore amount to a 'token gesture',

No! It would show leadership! Sadly lacking in some places.

I also suggested a 90% cut at director level. Tony says this is unrealistic. Why? BA could easily get 11 more effective directors than the current crop at £100k pa each. Contoversial?

cheers

Don

Don,

Again, the numbers:

2 exec directors, Walsh and Williams:

726k and 434k respectively

9 non-exec directors:

broughton on 350k, and the others on either 40k or 50k (4 on each). So, the average BA wage then...

I included the link to the annual report for a reason.

Phil