The UK government warned British Airways it risks losing valuable airport landing slots after deciding to let go 12,000 staff while claiming government money to protect jobs during the pandemic.
An urgent session in Parliament on Wednesday about aviation was dominated by lawmakers concerns over plans to slash the former flag carrier’s workforce.
Transport Minister Kelly Tolhurst, responding to questions from lawmakers, said she felt the concerns of workers and agreed that British Airways had breached the public’s trust by instituting sweeping job reductions while accepting state wage subsidies. She would consider asking the Civil Aviation Authority to take away some of the airline’s landing slots if it doesn’t reverse the staff reductions.
“Businesses get the benefit of being shareholders in the good times and must share the burden in the bad times,” Tolhurst said. “I’m quite willing to look at anything that could open up and increase the competition in our aviation sector.’
Like other airline companies, British Airways parent IAG SA is slashing costs to contend with a historic drop in air travel due to the virus. Carriers in Europe and the Middle East have signaled plans to eliminate more than 60,000 positions since the onset of the crisis, including 10,000 on Wednesday at Deutsche Lufthansa AG.
Carriers that predominate in the busy London market -- British Airways, Virgin Atlantic Airways Ltd., EasyJet Plc and Dublin’s Ryanair Holdings Plc -- account for more than one-third of the cutbacks, with British Airways the most aggressive.
Like other companies in the UK, airlines have also taken part in temporary furlough programs that subsidize salaries to help minimize job cuts. IAG has separately accessed 300 million pounds ($377 million) from the Coronavirus Corporate Finance Facility.
“We are acting now to protect as many jobs possible,” British Airways said in a statement, calling on unions to enter talks. “The airline industry is facing the deepest structural change in its history, as well as facing a severely weakened global economy.”
Unions and lawmakers have criticized British Airways for implementing such wide-ranging job cuts. The airline has also come under criticism over work rules governing the remaining employees.
“Does the minister agree BA should pay a price for a ‘breach of faith,’” Tolhurst was asked by Parliament member Jerome Mayhew. “Yes,” Tolhurst answered.
Tolhurst said it was up to the company to set employment terms. She promised to “do what I can in my capacity as aviation minister to mitigate or limit the number of job losses.”