Bríd Smith Urges Binding Conditions on Airline Wage Subsidies
Bríd Smith criticised the use of the temporary wage subsidy scheme by airlines and called for binding protections for workers against redundancies and pay cuts. She urged penalties for companies that breach commitments and said alternative state-support models, like the German approach to Lufthansa, should be considered.
Wage subsidy concerns
She noted that most airlines received the wage subsidy from day one yet imposed pay cuts and job losses. She cited Iberia, KLM and Air France as examples where state support was given with conditions to protect jobs and workers' terms, and gave Aer Lingus workers as an example of staff left on reduced payments and struggling with obligations on about €700 a fortnight.
Calls for binding employer commitments
She said the extension of the wage subsidy scheme must include binding commitments from employers availing of the scheme - specifically that there will be no compulsory redundancies and no permanent reduction in employees' terms and conditions of employment. She also argued the rate of payment for aviation workers should be adjusted to reflect hardship caused by large cuts in take-home pay.
Enforcement and penalties
She proposed that companies which abuse the scheme should be fined, that revenue should recover any supports paid to employers who breach commitments, and that legal action should be pursued in the courts if necessary.
Alternative state-support models and comparative critique
She expressed a preference for the German model in which the state took a stake in Lufthansa and board representation, and noted the Spanish approach of underwriting support on the condition of no redundancies. She said current events in the industry reveal a difference between how the Irish Government approaches workers' rights and the approaches used elsewhere in Europe.
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I wanted to ask about the wage subsidy scheme which most of the airlines have been receiving from day one and yet they imposed pay cuts and imposed job losses and I think when there is an advocacy to say that the state needs to step in and give more support then we should be looking at, according to the submission here, what they have done in Iberia, KLM and Air France which is actually to attach conditions to state support that is given to airlines so they cannot change workers' conditions, they have to protect jobs, they cannot create redundancies and I would just like a comment on that. How if the Irish state were to give more supports on top of the wage subsidy scheme how would they attach similar restrictions on the employer to stop abuse of the worker? Deputy, we have included in our submission that the extension of the wage subsidy scheme absolutely must include binding commitments from the employers that are availing of that scheme that there will be no compulsory redundancies, that there will be no permanent reduction in employees terms and conditions of employment and we also believe that for the aviation industry the rate of payment should be adjusted as well because for many of the workers in Aer Lingus for example that are working on 30% they are just receiving the wage subsidy only and you know the people that were earning and have built their financial obligations around their pre-Covid earnings now find themselves in a situation where they are earning €700 a fortnight and people are trying to raise their families and meet the obligations on that. I believe that where a company abuses the scheme, where they avail of the temporary wage subsidy scheme and then subsequently breach any binding commitments that may be entered into in relation to compulsory redundancies and so on, that the company should be fined and that revenue should take any support that has been given to those employers back and pursue them in the courts for the same if necessary. First of all, we would agree very much with the SIP2 position on that but what I would say to you our preference would be the German model. I think if Angela Merkel and the German Government are willing to take a £9 billion position in Lufthansa, they took 20% of the airline and put two people on the board of Lufthansa, I think it is not a million miles from the French position. Also, as a halfway house, you have the Spanish Government which said you get the billion underwritten on the grounds that there will be no redundancies. What is going on in the industry right now sharply shows the way the Irish Government approaches workers' rights and worker security is very different to what goes on across Europe. Thank you very much Mr Cullen and thanks Deputy Smith for that. Thank you Chair. Thanks. Thank you. Thank you.
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