A senior British Airways executive has defended Covid job cuts with an admission that the airline was in a “precarious position” as the pandemic grounded almost all flights.
Chief corporate affairs and sustainability officer Lisa Tremble was responding to questioning by MPs during a Commons transport committee hearing into travel disruption.
She appeared with Gatwick chief executive Stewart Wingate and EasyJet chief commercial officer Sophie Dekkers on Wednesday.
Tremble was asked whether too many people were forced out of BA as a result of ‘hire and rehire’.
She outlined that BA lost £3.5 billion during the pandemic.
Tremble said: “We were flying about 5% of our schedule, we were losing £20 million per day. When the bulk of our colleagues left the business in August [2020] there was no guarantee that furlough would continue and we were grateful that furlough did continue but it only contributed to 17% of our payroll cost.
“The business was in a really precarious position at that time and the decision was taken to protect as many jobs as possible, downsize the company to what we thought would happen in the future”.
“I accept it caused a lot of problems and mistrust with the unions and our people. I think that the business took the right decisions at that time to secure as many jobs as possible given the circumstances we were facing – no idea would there be a vaccine, how long would the restrictions continue.”
Addressing disruption earlier in the summer, Tremble said domestic, short-haul and a small number of long-haul flights had been cancelled over the current year.
“We took the decision around Easter time to match the schedule to the resources we had,” she added.
“Over the summer we took took out 13% of our schedule and the reason we did this was to build resilience into the system and make sure we got as many people away as possible
“That did work over the summer. In August we had cancellations of 0.13% which is essentially 28 flights.”
The three aviation bosses all agreed that staff shortages in ground handling that contributed to problems at airports this year needed to be addressed to avoid a repeat of disruption next summer.
DHL, which runs ground handling for EasyJet at Gatwick, brought in resource from Sainsbury’s to work across the summer, as the supermarket needs more resource at winter for Christmas, Dekkers revealed.
“We recognise there is a tightness in the labour market,” she said. “With record low unemployment levels, there is a challenge across the industry in terms of recruitment. It is something we are working very closely with our ground handling partners on and how can we support them with recruitment.”
Wingate pointed out that ground handling is licensed by Gatwick but contracted by airlines.
“We all agree that if we’re to have a summer next year it’s an area we all have to work together on to fix,” he told the committee.
“It’s a key focus area. We know the government has announced a review and we welcome that. We will work with the airlines to ensure there is sufficient ground handling resource at the airport with the right terms and conditions and the right skill levels.”
BA manages its ground handling in-house at Heathrow and has sought to attract more staff by raising salaries from £25,000 to £28,000 including shift pay, improving benefits and staff travel, Tremble said.
“It’s a really tight labour market, we are getting the applications in for those jobs, it does take time to process them still but it is getting easier as each month goes by,” she added.
About 5,000 people have been brought into BA including cabin crew “but it does take time” to get used to the job and that caused some of the problems over the summer “because you can’t expect people to come in and do everything at the same time”.
Wingate described Gatwick as being one of the hardest hit airports in the world by the pandemic.
The return of ‘use it or lose it’ slot utilisation rules in late January was welcomed along with the abolition of Covid travel restrictions.
“We recorded one of the strongest bounce-backs of any target European airport, partly because we were so heavily impacted by the pandemic,” he told the committee.
“Looking at 2022, we now think we’ll do about 33 million passengers going through the airport compared to just over 500,000 in the first six months of 2021. It’s an astonishing bounce back.”
Gatwick started recruitment campaigns last autumn when there was still a lot of uncertainty around, hiring more than 400 new security officers who started in the first half of the year. The South Terminal, which had been mothballed for nearly two years during the pandemic, was reopened on the first day of the summer season.
The airport operated until the end of May with little disruption but then saw more congestion at check in “which was a problem for us” and an uptick in same day cancallations of up to 12 flights a day.
“That alerted us to our concerns,” Wingate added. “This led us looking forward to decide that if we didn’t act together we’d have some really quite severe disruption over the summer holiday period due to insufficient airline ground handling resource to enable us to ramp up to a peak of 930 movements in August.
“Hence we gave passengers early notice that we were going to limit movements to 825 a day in July and 850 in August so we could give good levels of service. Passengers would also have advance notice of making alternative arrangements.”
Dekkers admitted that lengthy ID processing for staff “caught us out” in the early part of the summer. The “unprecedented” situation meant a process that would normally take 6 to 8 weeks was taking 12 to 16 weeks.
“We hadn’t anticipated this,” she said.
Tremble admitted to a backlog in EU261 passenger compensation requests for delayed or cancelled flights but said BA had issued 4.8 million refunds and 4.2 million vouchers since the start of the pandemic.
She called for a reform EU261 compensation rules following a lack of clarity over who is entitled to be reimbursed, particularly the grey area of ‘exceptional circumstance’.
Following the hearing, the consumer body Which? reiterated a demand on government to reform airline compensation rules.
Policy and advocacy director Rocio Concha said: “Which? reported both British Airways and EasyJet to the Civil Aviation Authority for potential consumer law breaches, yet months on, no action has been taken.
“This highlights the longstanding flaws in a system where regulators have no meaningful powers to crack down on rogue airlines.
“The government must give the CAA the power to directly fine airlines when they flout the law.
“Ministers must not cave in to demands from airlines to cut passenger compensation for delayed and cancelled flights, as this is a vital deterrent against travellers being left high and dry by last-minute schedule changes and overbooking of flights.”