Gullivers Travel Associates (GTA) has defended its introduction of pay reductions, redundancies and unpaid leave after travel trade union the TSSA claimed companies were using the economic climate as an excuse for cuts.
Travelport-owned wholesaler GTA blamed a sharp fall in booking volumes, room rates and foreign exchange rates for turning a $9 million profit in the first quarter of 2008 into a $10 million loss in the first quarter of this year.
The company said it cut costs in the first quarter, initially through reductions in areas of the business not affecting staff. It has now offered staff options including voluntary salary reductions, voluntary unpaid leave and voluntary redundancies.
Already, 90% of staff have taken a 5% pay cut, starting this week. More than 95% of its 2,400 employees worldwide have agreed to one or more of the options, and the rest are in consultation with the company.
In a statement, a spokesman said: “The global recession has impacted heavily on the travel industry, and GTA has been quick to respond to this downturn. Cost reduction is at the forefront of these actions.”
But TSSA regional organiser Jessica Fenn, who represents the travel trade, said: “It always seems to be the people on the ground who suffer first. I would like to know if the bonuses or wages of the chief executive or other senior executives have been reduced.
“It’s thinking about where you make these changes as a business. You are asking people on minimum wages to take cuts and this is typical of the sector.”
Average salaries for the industry were about £12,000 to £13,000, she said.
The TSSA does not have union recognition at GTA, but does have some members employed by the company. Fenn said the TSSA would consider starting the legal process for this if it was contacted by staff to do so.
She added: “Our position is that, wherever we have members, we will stand up for them.”
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