The Labour Relations Commission is meeting Aer Lingus unions today in a final effort to trim almost £100 million off the company's operating costs. The biggest stumbling blocks to reaching agreement are the proposed pay freeze and the size of the shareholding employees can expect in return for pay restraint and over 2,000 redundancies.
Even with the savings the company does not expect to return to profitability before 2003 and will have to cut back flight schedules and sell two aircraft. SIPTU, the main union at the State airline, remains opposed to the pay freeze, which would save Aer Lingus over £40 million during the next three years. IMPACT, which represents pilots, cabin crew and management grades, is prepared to accept a pay freeze but wants the employee share option scheme increased from a proposed 14.9 per cent to 30 per cent.
Both unions have been anxious to play down their different positions during negotiations. The chief executive of the Labour Relations Commission Mr Kieran Mulvey, will have to make a final decision on these and other issues such as increased productivity measures after today's meeting. The deadline to conclude the process is Wednesday.
Yesterday Mr Mulvey would not comment on the final shape of the rescue package. "Our objective is to produce a document that will give every employee of Aer Lingus, whichever union they are in, or none, an opportunity to vote on the future of the airline."
SIPTU had hoped to prod the Government into adopting a more pro-active role in financing the rescue package in order to secure payment of the second phase of the Programme for Prosperity and Fairness, worth 5.5 per cent. SIPTU president Mr Des Geraghty met the Taoiseach, Mr Ahern, at Government Buildings last week in a final push for State aid. However, the Government is maintaining its stance that aid will have to be limited to remain within EU guidelines and can only follow acceptance of the LRC plan.
The union has decided to continue its campaign for State aid with newspaper advertisements today. The SIPTU ad says "the staff - who hold a 5 per cent stake in the company - are being asked to cough up £45 million in payroll savings as well as 2,000 job cuts. The State - which owns 95 per cent of the company - must now make a contribution too."
SIPTU regional secretary Mr Noel Dowling said yesterday the fact that banks were prepared to invest up to £40 million in Aer Lingus, with aircraft as security, meant that the Government could invest as well, under EU rules.