British Airways warns of sweeping job cuts in response to coronavirus

British Airways has told staff to expect job losses as it prepares to ground hundreds of more flights amid the Covid-19 coronavirus crisis. 

In a message entitled The Survival of British Airways, chief executive/chairman Alex Cruz said: “We can no longer sustain our current level of employment and jobs would be lost – perhaps for a short term, perhaps longer term.”

Unions are involved in talks with the airline over the job losses but there is as yet no indication as to their scale. The airline boss said that British Airways, which is owned by FTSE 100 company IAG, was suspending routes and parking planes in a way they had “never had to do before”.

Cruz said that the airline was financially resilient but warned staff “not to underestimate the seriousness of this for our company.”

Overnight, budget airline Norwegian announced plans to temporarily lay-off about half its 11,000 staff as the Covid-19 coronavirus took its toll of flights and travel arrangements.

The operator blamed the “extraordinary market situation due to the coronavirus”, adding: “We must look at all possible measures to reduce costs.”

“This unfortunately also includes temporary layoffs of up to 50% of our employees, and the number may increase.”

The airline said it has begun consultations with unions and would soon give notice to the staff who will be affected.

It is thought that President Donald Trump’s ban on flights into the US from the 26 European Schengen countries was the final straw for the airline, although its flights to the US from Gatwick are still operating to schedule.

The airline will lay off about 5,500 people (out of 11,000) but warned that the number will increase. Nearly half of its long haul flights have been grounded and 25% of short haul flights cancelled until May.

Norwegian’s chief executive Jacob Schram said: “We urge international governments to act now to ensure that the aviation industry can protect jobs and continue to be a vital part of the global economic recovery.”

Norway’s Prime Minister Erna Solberg has said that her government would offer financial assistance to hard-hit industries, including airlines, but no details have been given.

British Airways and Norwegian are far from alone among airlines seeking dramatic cost cuts. Businesses all over the world have been encouraging staff to take unpaid leave, many emphasising that this was “entirely optional”. Many  major carriers including easyJet and Virgin Atlantic are implementing recruitment freezes in addition to unpaid leave offers. Virgin CEO Shai Weiss and its executive team have taken a 15-20% salary cut until June.

US operators Delta, American, United and JetBlue had also taken measures such as freezing hiring, cutting flights and delaying capital expenditure and Southwest Airlines CEO Gary Kelly has taken a 10% cut in pay.

Meanwhile, the Unite union has warned that Southampton airport is in “imminent danger” of having to close without government intervention. Baggage handler Swissport has told staff at the airport that it will cut around 40% of its 200-strong workforce there.

The demise of regional airline Flybe and the cancellation of other flights because of coronavirus lie behind the airport’s problems, said Unite regional officer Chris Gray, who added: “Southampton Airport can weather this storm, but it will require immediate government assistance to keep the UK’s airline industry up and running.

“As well as being an important employer, Southampton Airport is a key hub for the region’s economy.

“Ministers must step in and ensure the airport emerges after the current difficulties facing the industry have passed.”

More than 200 Swissport employees’ jobs were also under threat at Edinburgh, Aberdeen and Glasgow with Unite calling on the cargo and passenger processing firm to “halt this redundancy process and talk to us in order to find solutions to keep people in work”.

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