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Coronavirus: BA expected to suspend 36,000 staff | Coronavirus: BA expected to suspend 36,000 staff |
(33 minutes later) | |
British Airways is expected to announce it will suspend around 36,000 staff. | British Airways is expected to announce it will suspend around 36,000 staff. |
The airline, which grounded much of its fleet due to the coronavirus crisis, has been negotiating with the Unite union for more than a week. | The airline, which grounded much of its fleet due to the coronavirus crisis, has been negotiating with the Unite union for more than a week. |
The two sides have reached a broad deal but are yet to sign on some details. | The two sides have reached a broad deal but are yet to sign on some details. |
The agreement means that up to 80% of BA cabin crew, ground staff, engineers and those working at head office will have their jobs suspended but no staff are expected to be made redundant. | The agreement means that up to 80% of BA cabin crew, ground staff, engineers and those working at head office will have their jobs suspended but no staff are expected to be made redundant. |
The decision will affect all staff at Gatwick and London City Airport after the airline suspended its operations at both locations until the crisis is over. | The decision will affect all staff at Gatwick and London City Airport after the airline suspended its operations at both locations until the crisis is over. |
Those affected are expected to receive some of their wages through the government's coronavirus job retention scheme, which covers 80% of someone's salary capped at a maximum of £2,500 a month. | Those affected are expected to receive some of their wages through the government's coronavirus job retention scheme, which covers 80% of someone's salary capped at a maximum of £2,500 a month. |
No one who works at British Airways will be surprised at today's expected announcement. When the planes are sitting on the ground - and nearly all of BA's fleet is doing just that, dispersed to regional airports around the country - there is no need for the army of workers who fly the aircraft, maintain them, load and unload the bags, and serve the passengers. | No one who works at British Airways will be surprised at today's expected announcement. When the planes are sitting on the ground - and nearly all of BA's fleet is doing just that, dispersed to regional airports around the country - there is no need for the army of workers who fly the aircraft, maintain them, load and unload the bags, and serve the passengers. |
Staff typically make up about 40% of an airline's costs, and BA should be able to reclaim 80% of wages from the government employment support scheme set up to help companies affected by the virus. | Staff typically make up about 40% of an airline's costs, and BA should be able to reclaim 80% of wages from the government employment support scheme set up to help companies affected by the virus. |
BA has not, so far, asked the government for any other specific financial assistance. Nor has EasyJet, where senior sources say the general assistance programmes - wage assistance and loan guarantees - should be sufficient. | BA has not, so far, asked the government for any other specific financial assistance. Nor has EasyJet, where senior sources say the general assistance programmes - wage assistance and loan guarantees - should be sufficient. |
Virgin Atlantic, however, continues to press, and has written to MPs pointing out that it provides the only British-flagged competition to British Airways on many key routes from Heathrow. | Virgin Atlantic, however, continues to press, and has written to MPs pointing out that it provides the only British-flagged competition to British Airways on many key routes from Heathrow. |
So far the Chancellor, Rishi Sunak, has taken a hard line, saying airlines should exhaust all financial revenues before turning to the taxpayer. If Virgin does make a formal application for more aid, it will have to be able to show it has met the chancellor's test. | So far the Chancellor, Rishi Sunak, has taken a hard line, saying airlines should exhaust all financial revenues before turning to the taxpayer. If Virgin does make a formal application for more aid, it will have to be able to show it has met the chancellor's test. |
John Strickland, independent aviation analyst, said "tough negotiations" between BA and the Unite union meant it had taken a while to reach an agreement. | John Strickland, independent aviation analyst, said "tough negotiations" between BA and the Unite union meant it had taken a while to reach an agreement. |
"The pilots' deal for half pay was concluded rather earlier, I guess there was a recognition as to just how serious that issue was," he said. | "The pilots' deal for half pay was concluded rather earlier, I guess there was a recognition as to just how serious that issue was," he said. |
It is thought that the Unite union has been pushing for staff to be paid more than that. BA has already reached a separate deal with its pilots who will take a 50% pay cut over two months. | It is thought that the Unite union has been pushing for staff to be paid more than that. BA has already reached a separate deal with its pilots who will take a 50% pay cut over two months. |
BA's parent company, International Airlines Group (IAG), is in a better financial position than some of its competitors. The group has made healthy profits in recent years. | BA's parent company, International Airlines Group (IAG), is in a better financial position than some of its competitors. The group has made healthy profits in recent years. |
But the airline's expected decision to suspend such a large number of workers gives a sense of how hard UK aviation has been hit by travel restrictions, designed to stem the spread of the pandemic. | But the airline's expected decision to suspend such a large number of workers gives a sense of how hard UK aviation has been hit by travel restrictions, designed to stem the spread of the pandemic. |
With future bookings cancelled for the foreseeable future, airlines have been haemorrhaging cash. | With future bookings cancelled for the foreseeable future, airlines have been haemorrhaging cash. |
Over the next three months, the International Air Transport Association expects airlines to rack up losses of almost $40bn (£32.3bn). It said carriers were burning through their cash reserves fast, mainly because of the multi-billion-pound cost of refunding tickets for cancelled flights. | Over the next three months, the International Air Transport Association expects airlines to rack up losses of almost $40bn (£32.3bn). It said carriers were burning through their cash reserves fast, mainly because of the multi-billion-pound cost of refunding tickets for cancelled flights. |
Many staff at Virgin Atlantic have had their jobs suspended for two months and crews at Easyjet are out of work for three months. | Many staff at Virgin Atlantic have had their jobs suspended for two months and crews at Easyjet are out of work for three months. |
This week, British Airways has run government repatriation flights to get hundreds of British nationals home from Peru, after the country went into lockdown. | This week, British Airways has run government repatriation flights to get hundreds of British nationals home from Peru, after the country went into lockdown. |
It is one of several UK-based airlines that has agreed to run further repatriation flights in the coming weeks as hundreds of thousands of people are still stuck in other parts of the world. | It is one of several UK-based airlines that has agreed to run further repatriation flights in the coming weeks as hundreds of thousands of people are still stuck in other parts of the world. |
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