British Airways expected to suspend 36,000 staff

4:26 pm on 2 April 2020

British Airways is expected to announce it will suspend around 36,000 staff.

A British Airways passenger jet at London City Airport, last month the company suspended all flights until the end of April due to the coronavirus outbreak. Photo: AFP

The airline, which grounded much of its fleet due to the coronavirus crisis, has been negotiating with the Unite union for more than a week.

The two sides have reached a broad deal but are yet to sign on some details.

The agreement means that up to 80 percent of British Airways cabin crew, ground staff, engineers and those working at head office will have their jobs suspended but no staff are expected to be made redundant.

The decision will affect all staff at Gatwick and London City Airport after the airline suspended its operations at both locations until the crisis is over.

Those affected are expected to receive some of their wages through the government's coronavirus job retention scheme, which covers 80 percent of someone's salary capped at a maximum of £2500 a month.

It is thought that the Unite union has been pushing for staff to be paid more than that. British Airways has already reached a separate deal with its pilots who will take a 50 percent pay cut over two months.

British Airway's parent company, International Airlines Group (IAG), is in a better financial position than some of its competitors. The group has made healthy profits in recent years.

But the airline's expected decision to suspend such a large number of workers gives a sense of how hard UK aviation has been hit by travel restrictions, designed to stem the spread of the pandemic.

With future bookings cancelled for the foreseeable future, airlines have been haemorrhaging cash.

Over the next three months, the International Air Transport Association expects airlines to rack up losses of almost $US40bn. It said carriers were burning through their cash reserves fast, mainly because of the multi-billion-pound cost of refunding tickets for cancelled flights.

Many staff at Virgin Atlantic have had their jobs suspended for two months and crews at Easyjet are out of work for three months.

This week, British Airways has run government repatriation flights to get hundreds of British nationals home from Peru, after the country went into lockdown.

It is one of several UK-based airlines that has agreed to run further repatriation flights in the coming weeks as hundreds of thousands of people are still stuck in other parts of the world.

Meanwhile, New Zealand's national airline, Air New Zealand this morning announced it is slashing its domestic flights by 95 percent while the country is in lockdown at Alert Level 4 during the Covid-19 outbreak. Last week, Air New Zealand chief executive Greg Foran said neither the government's $900 million loan nor the wage subsidy scheme was enough to stave off cutting almost 13,000 jobs by at least a third.

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- BBC / RNZ