A growing strike wave threatens Ryanair’s summer schedule. Ian Taylor reports
Ryanair joined easyJet, Wizz Air and the International Airlines Group which owns British Airways, Iberia and Aer Lingus in demanding EU action to lessen the impact of air traffic control strikes last week.
But the airline faces a bigger threat to its schedule from its growing confrontation with pilots and cabin crew across Europe as unions demand improved employment terms which could eat into Ryanair’s costs advantages over rivals.
The German Vereinigung Cockpit union announced on Monday that Ryanair pilots in Germany had voted 96% in favour of strikes over pay and conditions and forecast action “possibly” within a week. The union said it would give “at least” 24-hours’ notice.
Ryanair pilots in Ireland struck this Friday (August 3). Cabin crew in Spain, Portugal and Belgium struck for two days last week, and crew in Italy for one day.
The carrier hit back last week, issuing redundancy notices to more than 100 pilots and 200 cabin crew in Dublin, blaming strikes on July 12, 20 and 24 for a 20% cut in its Dublin fleet this winter following “a downturn in forward bookings and airfares”.
But that only led Irish pilots’ union Forsa to call another strike this week, denouncing the airline’s move as “reckless”. The European Cockpit Association (ECA), which represents pilots in 38 associations, warned: “This will fuel frustration.”
ECA president Dirk Polloczek said: “Ryanair pilots across Europe are determined to obtain direct employment contracts governed by the local law of the country they are based in. A fair and transparent Master Seniority Agreement is a common standard across the industry. Why not at Ryanair?”
Philip von Schöppenthau, ECA secretary-general claimed: “The airline is reverting to previous anti-union tactics while claiming to engage with unions.”
The International Transport Workers’ Federation (ITF), which represents cabin crew, warned Ryanair to “expect further strike action over the summer if it continues to ignore the legitimate demands of its workers”, and Spanish pilots’ union Sepla warned: “This unrest is only beginning.”
It’s all a far cry from last December when Ryanair announced it would recognise unions for the first time.
The ITF suggested: “Since then, there have been no concrete improvements in pay and conditions.”
British airline pilots’ union Balpa suggested: “Ryanair is still coming to terms with dealing with trade unions.”
Union complaints centre on Ryanair’s refusal to employ staff under local laws with the accompanying rights and benefits. For example, Spanish cabin crew union SITCPLA alleges Ryanair crew need an EU health insurance (EHIC) card to access medical treatment in Spain even when Spanish residents.
Ryanair chief executive Michael O’Leary forecast “further strikes over the peak summer” when he reported the airline’s quarterly results last week.
O’Leary insisted: “We’re not prepared to concede to demands that will compromise our low fares.”
The carrier blamed a 20% fall in profits partly on increased staff costs, “primarily due to pilots’ 20% pay increase”. Yet it still reported €319 million in profits for the three months to June and forecast full-year profits of €1.35 billion.
Strike-caused cancellations can only cause perceptions of the carrier to deteriorate. But the real threat is less to Ryanair’s short-term profits than to its long-term business model.
In the words of one aviation analyst, Kathryn Leonard of Numis, labour disputes “are in the margin” in terms of costs. But she told business newspaper the Financial Times: “There is a risk you start to see changes in working practices that lead to a less efficient labour base.”