Unite concedes at Monarch Airlines

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Unite’s decision to call off a local government strike in October is well known. Less well publicised has been the union’s role at Luton-based Monarch Airlines, where its members suffered massive pay cuts and wholesale redundancies in the past month.

Monarch is a medium-size airline, its 42 aircraft flying 6 million holidaymakers to the Mediterranean last year. It has been owned by Swiss multimillionaires the Mantegazzas for 47 years but wasn’t making much profit in a holiday market down 20 percent since 2008.
Monarch needs a new fleet and the Mantegazzas did not want to shell out. So they sold to City investment firm Greybush Capital in a deal completed in late October.

The price sought by Greybush was a cut of 900 in the workforce of 3,300 and pay cuts of up to 30 percent.

Monarch insisted it must move to a “low-cost” airline model in order to compete with Ryanair and EasyJet. It identified Greybush as “preferred bidder” on 23 September and, a day later, joined Unite and pilots’ union Balpa in issuing a joint statement declaring, “Monarch staff groups support restructuring.” This announced “changes [that] impact all areas and involve concessions of up to 30 percent in salaries”, but noted, “Following supportive discussions with union representatives of Balpa and Unite, staff balloted…and on average more than 90 percent voted in favour.”

Unite national officer Oliver Richardson was quoted saying, “Our priority is the welfare and longer-term job security of our members.” Balpa general secretary Jim McAuslan said, “Pilots and their colleagues at Monarch have made major sacrifices to secure the future of this important British company.”

Unite was reluctant to comment further, but Richardson confirmed to trade paper Travel Weekly, “All groups are taking significant pay cuts. For crew, the big cuts are [in] variable pay associated with flying and basic pay for senior crew.

“Main crew can’t have the same cuts to their basic as pay would be below the legal minimums, but their variable [pay] is a higher proportion of their total income. Engineers face similar cuts to pilots [ie up to 30 percent].”

Richardson justified these huge concessions, saying, “We’re faced with the real prospect of all jobs being at risk if the company went into administration. We saved as many as possible and protected pay and terms and conditions as best as we could.” There was no alternative as far as Unite is concerned. But there was.

While Monarch workers were surrendering on jobs and pay, pilots at Air France went on strike for 14 days from mid-September against parent Air France-KLM’s plans for rapid growth at “low-cost” subsidiary Transavia. They understood Transavia’s expansion would come at the expense of their wages and conditions.

It was the longest strike in Air France history and cost Air France £330 million. When pilots threatened to stay out indefinitely, the Financial Times reported, “Air France-KLM has dropped plans to develop its low-cost airline across Europe.”

The action divided the French government. At one point prime minister Manuel Valls sided with management to declare the strike was damaging France, only for transport minister Alain Vidalies to tell reporters, “The Transavia project has been abandoned” ahead of Air France making an announcement.

Unfortunately, the pilots’ unions then called off the strike without an agreement and Air France made it clear it would not drop plans for Transavia in France. Nonetheless, it was a partial victory and the lessons seem clear.

When Greybush took over Monarch on 24 October, the airline announced 700 redundancies, explaining it had won further concessions including increased part-time working. Unite gave a “cautious welcome”, noting, “Our priority now is the welfare and longer-term job security of our members.” It’s not the end of the story, but you might think it’s a bit late.