This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.bbc.co.uk/news/business-52130021
The article has changed 8 times. There is an RSS feed of changes available.
Version 6 | Version 7 |
---|---|
Coronavirus: BA reaches deal to suspend thousands of workers | |
(about 2 hours later) | |
British Airways has reached a deal to temporarily suspend more than 30,000 of its cabin crew and ground staff. | |
The airline, which has grounded most of its fleet due to the coronavirus, has been locked in talks with unions for more than a week. | |
But on Thursday, BA boss Alex Cruz told staff that a large majority of employees would be suspended for the next two months. | |
He said the government's job retention scheme would fund 80% of their wages. | |
Explaining the decision, Mr Cruz said: "We need to act now to protect jobs and ensure that BA comes out the other side of this crisis in the best possible shape." | |
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. |
"The number of colleagues who will be furloughed reflects the significant drop in flying," Mr Cruz said. | |
Under the jobs retention scheme, the government funds 80% of someone's salary capped at a maximum of £2,500 a month. But union Unite said there would be no cap on earnings under its agreement with BA. | |
The union also said no BA staff would be made redundant during the coronavirus crisis. | |
"Given the incredibly difficult circumstances that the entire aviation sector is facing this is as good a deal as possible for our members," the union's national officer for aviation, Oliver Richardson, said in a statement. | |
No one who works at British Airways will be surprised at today's 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. |
BA had already reached a separate deal with its 4,000 pilots who will take a 50% pay cut over two months. | |
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. | |
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. | |
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. |
Are you a BA employee? Share your experiences by emailing haveyoursay@bbc.co.uk. | Are you a BA employee? Share your experiences by emailing haveyoursay@bbc.co.uk. |
Please include a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways: | Please include a contact number if you are willing to speak to a BBC journalist. You can also contact us in the following ways: |
Or use the form below | Or use the form below |