British Airways and the union that represents it 4,500 pilots are said to have reached an urgent deal in order save costs and jobs because of the Coronavirus pandemic. The emergency measures will see basic wages for pilots slashed by around 50 per cent, although the prospect of forced redundancies seems to have been discounted for now at least.
In April and May, pilots will be expected to take two weeks of unpaid leave, with the loss of earnings distributed over a three month period. An internal memo sent by the airline to its pilots and sighted by the Financial Times said the measures would help address “the immediate threat to the business in the face of Covid-19 and the unprecedented impact this is having on the airline”.
Last week, the airline’s boss Alex Cruz penned a letter which was titled “the survival of British Airways”. Cruz warned there would inevitably be job losses across the business and hoped the majority would be shortlived, although some jobs might be lost for much longer.
Along with nearly every department across the business, pilots had been warned of an “unspecified” number of redundancies. Unions are still actively negotiating on deals to address the financial crunch and how they might impact workers in different areas of the business including its cabin crew.
The chief executive of BA’s parent company, Willie Walsh has agreed to delay his planned retirement of April and remain in his position until June at the earliest. Walsh will take a 20 per cent pay cut but hold onto a £883,000 bonus from 2019’s results. He earned a total of £3 million last year.
Cruz has not signalled any intent to give up any portion of his wages. In contrast, the likes of Alan Joyce at Qantas and Delta’s Ed Bastian have both said they’ll forego 100 per cent of their wages until at least June.
British Airways is part of the IAG group which also includes Iberia and Aer Lingus. Iberia has applied to temporarily lay off 90 per cent of its flight crew but under Spanish law, the government will cover up to 70 per cent of their salaries.
Aer Lingus, meanwhile, will cut the pay of its roughly 5,000 employees by half in April and May but warned further cuts might be necessary if the current flight schedule has to reduced even more.
