The chief executive of British Airways has told MPs that the airline is ditching its controversial ‘fire and rehire policy’ for cabin crew.
Alex Cruz told Parliament’s transport select committee this morning that “there will be no need to issue new contracts” as the policy – which saw some staff facing 50% pay cuts – was now “off the table”.
Unions criticised the policy when it was announced earlier in the coronavirus pandemic, as BA started a consultation which could see 13,000 jobs made redundant, and MPs labelled the national flag carrier’s plans a ‘national disgrace’ in a transport select committee report for its handling of job cuts during the pandemic.
British Airways has now reached the outline of a jobs agreement with union Unite.
Cruz said it was a “regret” that it took 73 days for BA’s non-pilot unions to sit down and negotiate.
But Labour MP Sam Tarry said: “I would argue that if you hadn’t put a metaphorical gun to their head then that might not have happened.”
Cruz said the airline would now follow the ‘standard methodology’ of union agreements and make amendments to existing the contracts.
Long-serving cabin crew members face a 15% pay reduction, while hoping to retain many of the allowances which constitute a significant part of their overall pay.
“We have reached agreements in a majority of areas”, Cruz said, adding that he hoped staff will vote in favour of the proposals.
Asked if British Airways would make the full 13,000 job cuts, Cruz said the airline didn’t “need to get to that number”.
He told MPs that the pandemic had “devastated our business… and we’re still fighting for our own survival”.
Last week the airline flew about 187,000 passengers – about 25%-30% of its normal flight schedule.
“Everyone is facing decisions we never wanted to face,” said Cruz.
He said he had taken a 33% pay cut during the pandemic, reducing his salary from the £805,000 he earned in 2019.
But he refused to comment on an £833,000 bonus paid to the outgoing boss of BA’s parent company, Willie Walsh, who left IAG earlier this month.
But Unite assistant general secretary Howard Beckett said Cruz’s comments to the committee were “not entirely correct”. He said: “Alex Cruz has misled the transport select committee by indicating that fire and rehire is completely off the table. This needs to be corrected.
“There are still too many BA workers facing threats to their wages and working life. These threats should be withdrawn today.
“This is a very important matter and we would not wish MPs and the select committee to get the wrong impression. To be clear, the fire and rehire threat still hangs over some BA workers.”
He added: “If Alex Cruz wishes to take this opportunity to say that he is removing this threat from our members then Unite is more than ready to talk.
“Draft agreements with British Airways will not be finalised by Unite until members have voted on them and agreed to changes in their contracts.
“Even if agreements are reached and finalised in all of British Airways sectors, this does not herald industrial peace.
“Any changes in contracts should have been of a temporary nature and once British Airways returns to profit, the cuts in pay and conditions should be immediately restored.”
“This is the very least that British Airways should do for its loyal staff who were instrumental in delivering profits of £1.9 billion last year.”
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