Aer Lingus: facing job cuts

Aer Lingus could receive a multimillion euro rebate from the government if it is successful in its attempts to seek 1,500 job cuts through redundancy or outsourcing its staff.


Much depends on whether new legislation introduced last year in the wake of the Irish Ferries controversy surrounding its decision to replace its staff with cheaper eastern European workers can be invoked by Aer Lingus workers.


New figures from the Department of Enterprise, Trade and Employment also reveal it has paid out over €750m in the past four-and-a-half years either to companies who have made staff redundant or directly to workers whose employers have failed to make redundancy payments.


Following closures and corporate downsizing, companies or their employees received €183m in rebates last year alone under the Redundancy Payment Acts. This represents an increase of €34m compared to 2005.


In the first nine months of this year, €113m was paid out, a figure expected to rise as outstanding claims are processed.


The Sunday Tribune has established that Aer Lingus, whose plan to achieve the job cuts through redundancies and outsourcing has been billed as "Irish Ferries mark two" by one union, could be entitled to significant rebates from the government if the plan goes through.


A spokeswoman for the department said statutory redundancy payments are calculated on the basis of two weeks' pay for every year of service, plus a bonus week, subject to a maximum wage "ceiling" of €600 per week.


"Employers who pay their employees the correct statutory redundancy entitlement and give them proper notice of being made redundant (at least two weeks) are entitled to a 60% rebate from the Social Insurance Fund (SIF)," she said. "Employers pay contributions to the SIF in respect of redundancy through the PRSI system."


However, she said legislation passed last year had put in place protection for employees in situations where there is a possibility of the collective compulsory replacement of workers by lower-paid workers.


Among the conditions which must be met are that the dismissals are collective and done on a compulsory basis, and that the dismissed employees are replaced at the same location or elsewhere in the state, she said.


If the move by Aer Lingus was determined to constitute "an exceptional collective redundancy", staff being let go would not qualify as redundancies but under the unfair dismissals legislation, she said.


Employees would therefore be free to pursue unfair dismissal cases, she added.