Airline caterer Gate Gourmet is set to resume talks with its union today aimed at ending a dispute which grounded British Airways earlier this month and has disrupted BA in-flight service.
Europe's third-biggest airline offered a more generous contract to Gate Gourmet on Tuesday but refused to sign until the caterer resolved a dispute over staff redundancies with its union.
Gate Gourmet, which says it needs a new contract with BA and staff cuts to stave off bankruptcy of its UK operations, responded by deferring a decision to put the operations into bankruptcy administration.
A spokesman for The Transport & General Workers Union (T&G) said on Wednesday he expected negotiations with Gate Gourmet to restart after breaking down a day earlier.
"We will be inviting (Gate Gourmet Chief Executive) David Siegel to attend a meeting," he said.
Gate Gourmet said in a statement late yesterday that it expected talks to continue over the next few days.
Owned by US private equity firm Texas Pacific Group, Gate Gourmet sacked 670 staff earlier this month after workers walked out over the hiring of temporary staff, a move which triggered a sympathy strike by 1,000 BA workers.
More than 100,000 BA passengers were stranded by the walkout.
Analysts say the walkout probably cost BA more than 30 million pounds and the airline's meal service is still not back to normal after more than a week.
The disruption reflects union resentment after BA sold its catering operations to Gate Gourmet in 1997 and then pressed for cheaper contracts. The T&G has large membership at both companies.
Gate Gourmet, based in Switzerland and the United States, defaulted on its debt several months ago, a source close to creditors told Reuters.
Its UK arm lost 22 million pounds last year and management says it is set to lose more in 2005 unless changes to working practices are made.