Aer Lingus has issued a warning to its 784 Irish pilots that the refusal to accept a proposed salary deal could result in its parent company, IAG, halting further investment in the airline’s growth. The threat holds, even in the presence of industrial action. This news emerges as the Labour Court finalises a hearing date for the ongoing pay dispute, set for 22nd April. The conflict, involving prolonged talks of over a year between the airline and the IALPA pilots’ union, stalled recently at the Workplace Relations Commission.
In a communique dispatched directly to the pilots, Aer Lingus’s Chief Operations Officer, Adrian Dunne, explained the circumstances surrounding the dispute. He emphasised that IAG may view the failure to establish agreement on a pay deal as a desire from pilots for a different future. As previously reported during the annual results discussions on 16th February, the growth of Aer Lingus could see no further investment from IAG due to noncompetitive costs and low productivity not rewarding investment.
Dunne has warned that this could result in the incapacity to obtain aircraft through IAG, leading to new aircraft designated for other IAG carriers. This would have consequential effects on both current and prospective employment and career advancement for all employee categories. Dunne further noted that there could be the potential loss of a planned A321XLR aircraft, due for delivery this year. This would minimise pilot requirements by 80, and this aircraft could be allotted to other group airlines such as British Airways, Iberia and Vueling.
Despite the offering of an 8.5% increase to the pilots by the airline’s internal pay tribunal, it has been rejected. The company claims the increase is equivalent to 12.25% when a 2019 crewing agreement cost is incorporated. The union counters, voicing a demand for a 23.88% increase, considering the summer leave flexibility cost. However, from management’s perspective, their demands equate to a 27% pay rise, factoring in the crewing deal’s expense.
If the proposed pay offer is accepted, Aer Lingus forecasts its pilot costs escalating from currently €157 million to €174 million. If a 27% increase is applied, the cost would jump to €196 million. Dunne criticised IALPA’s claim as “excessive, unsustainable and not justifiable”.
The airline is concerned that a rise in pilots’ salaries might undermine its competitiveness against its main adversary on European flight paths, namely Ryanair. In reaction to the letter from Aer Lingus, an IALPA representative characterised the communication as ‘counterproductive’, emphasising that they are proactively participating in an industrial negotiations process with sincerity. It is highlighted by IALPA, a division of the Fórsa trade union, that there has been no wage increase for Aer Lingus pilots since 2019, despite a 19% increase in living costs over the same timeframe. It’s worth noting that last year Aer Lingus reached an agreement on pay with their cabin crew and furthermore initiated the recruitment of pilots, a first since 2019.