The Labour Court has recommended pay increases of 8.5% over 39 months (2017 to 2020) for 3,000 staff at Aer Lingus. The increases recommended by the Court - which are not conditional to any additional productivity - average just over 2.6% per annum, which is consistent with current average pay improvements in the private sector.

The deal expires on 30th June 2020, and the recommendation follows a pay claim made by the group of unions, IMPACT, Siptu, Unite and the TEEU.

The pay terms recommended by the Court provide for the following increases:

• 3% from 1st April 1 2017
• 2.75% from 1st May 2018
• 2.75% from 1st June 2019

The Court has also recommended that the parties engage to explore the potential for an agreement on an appropriate ‘profit share’ scheme.

IMPACT national secretary Angela Kirk said the pay improvements are welcome. “The Court took particular note of the fact that there have been no adjustments to basic pay since 2010, during which time the company has performed exceptionally well. There is no doubt in that the success of Aer Lingus during that time is down to the exceptional efforts and hard work of its employees.

“Pay improvements are already happening throughout the economy, in both the public and private sectors. Aer Lingus staff are now part of the pay movement that is crucial to Ireland’s continuing economic recovery,” she said.

Angela said a number of issues were identified by the group of unions at its meeting last week (11th September) that require clarification by Aer Lingus. The group is to meet the company tomorrow (20th September) to get these clarifications, after which the unions will agree a schedule for balloting on the recommendation.

Performance

In its submission to the Court, the group of unions argued that Aer Lingus’ strong financial performance was evident from the strong profit levels last year, in addition to its strong performance compared to other airlines in the IAG group, which took over the airline in 2015.

The company has made an operating profit in every year since 2010, enabling it to have €1 billion of free cash on its balance sheet, supporting the claim for an appropriate profit share scheme.

The unions also argued that the airline’s exceptional financial performance was down to the efforts of its employees, pointing to “dramatic” improvements in payroll. Measured as a percentage of cost revenue, this declined from 25.95% in 2009 to the current figure of 18.5%.

Angela explained that the Court had further recommended engagement by both parties to immediately engage for three months to agree on productivity matters. “The Court has recommended that savings achieved as a result of agreed implemented measures are to be shared between the parties on a ‘one for one’ basis,” she said.

Angela said if direct talks failed to reach agreement in three months, the Court recommends that the parties should use normal procedures, including a referral to the Court from the WRC.

Related: