Airports - Jobs fly away

Airport giant BAA have announced major job cuts just weeks after announcing a £6.8bn investment for their three London facilities over the next ten years.

Submitted by Freedom on November 27, 2005

BAA publicly announced 700 redundancies as part of their new 'Delivering Excellence' plan, which they say is designed to improve customer service.

Adding insult to injury, the losses - which were not consulted with unions - came just days after the announcement of a huge rise in profits for the company.

The company is also currently a front-runner to gain control of a majority stake in the $2bn sale of Budapest Airport.

The spectacle of massive investment in facilities while hundreds of staff are sacked, along with a hike in payouts to shareholders of over 5%, has led to widespread criticism.

BAA saw a 9.6% rise in half-year operating profits to £412 million, up from £376 million in the previous half. This was despite a significant drop in tourism from the 7th July London tube bombings and the impact of the Gate Gourmet dispute, which grounded many flights from their airport.

Most of the cuts will be at Heathrow, Gatwick and Stansted, and is already affecting personnel in the company's supply chain, IT and human resources units. BAA employs around 9,400 staff in its airports.

Mike Clasper, chief executive of BAA, said: "Delivering Excellence will improve customer service and shorten decision chains, leading to more effective. Supported by further innovation, it will deliver continued improvement in our business performance."

But Clasper admitted that the company was expecting a rise in the number of passengers at their major airports at the same time as they would be cutting staff: "As announced on 20th September, we anticipate around 3% traffic growth for our UK airports this year."

Unions have condemned the cuts, though none have as yet suggested the possibility of industrial action. Four trades unions are currently recognised for the representation of airport staff: TGWU, Amicus, PCS and Prospect. Heathrow Express recognises Aslef.

Brendan Gold, the T&G national secretary for civil air transport said: "It does give us cause for concern that BAA has by-passed normal consultation and told 700 staff they have an uncertain future".

The company have refused to rule out compulsory redundancies, and said the losses were needed due to 'threats' to its business, such as a downturn in spending at its shops and a the possible impact of increased crowding at its major airports leading to delays in service.

The rise in BAA's profits this year however were driven by a surprise rise in retail profits from its airport shops, alongside an increase in long-haul traffic.

Job losses have capped a year of disagreement between the unions and BAA. Disputes had risen over a number of policy areas, including the working time directive, criminal record checks and the introduction of a new retirement policy.

It was only after several months of negotiations that deals were reached, which agreed a pay settlement equivalent to an 8% rise in wages over the next two years, just ahead of likely inflation rates.

Earlier in the year, industrial action by Glasgow fire fighters also had a major impact, over health and safety issues as the company attempted to remove fire fighters from the city airport.

The nature of the job losses, announced on the 1st November,may have undermined the stated employment policy of BAA, which says: "We are committed to being the employer of choice wherever we operate. In 2005/06 we will continue to work across our business to achieve this goal."

Shares in the company rose by 2.6% the day after the redundancies announcement.