MAG confirms it will begin discussions with unions on potential job losses
MAG, the UK’s largest airport group, has confirmed it will begin discussions with unions on proposals to reduce employee costs in response to the impact of the coronavirus pandemic.
This follows a 90% reduction in demand for travel through MAG airports since March, compared with the previous year. Aviation has been one of the hardest hit sectors of the economy and MAG’s current monthly demand is still 75% below normal levels.
In recent weeks, the prospects for a strong recovery over the next 12 months have declined as the virus has re-emerged across the UK and Europe. Meanwhile, the absence of dedicated support for the aviation sector, coupled with a lack of progress in introducing testing for UK passengers to date, has continued to undermine consumer confidence in air travel for next year. Overall passenger demand is not expected to recover fully before 2023-24.
Since the start of the pandemic, MAG has taken steps to reduce its cost base, including asking every employee to take a 10% pay cut for a year and pausing capital investment and non-essential expenditure. MAG has already reduced the size of its management team, and worked closely with its trade unions throughout the period in order to protect as many jobs as possible.
As part of this, MAG has made extensive use of the Government’s Job Retention Scheme since its introduction in March. This scheme will be replaced by the recently announced Job Support Scheme from the beginning of November, offering employers a much smaller contribution to meeting payroll costs for a six-month period.
The reduction in Government financial support, combined with a more challenging outlook, means that MAG now needs to propose further steps to reduce the size of its workforce to secure the long-term future of the business.
The proposals could mean the loss of 465 roles at Manchester Airport, 376 roles at London Stansted Airport and 51 roles at East Midlands Airport, along with adjustments to roles, roster patterns and other employment measures.
All of these proposed measures will be subject to consultation with MAG’s unions and staff across Manchester, Stansted and East Midlands Airports.
Charlie Cornish, CEO of MAG, said: “By now, we would have hoped to see a strong and sustained recovery in demand. Unfortunately, the resurgence of the virus across Europe and the reintroduction of travel restrictions have meant this has not happened.
“With uncertainty about when a vaccine will be widely available, we need to be realistic about when demand is likely to recover.
“The end of the Job Retention Scheme means that we have to consider the number of roles that we can sustain at our airports.
“We will be discussing these issues with our trade unions, and consulting them fully on a range of options for reducing the size and overall cost of our workforce. We want to work with them to make sure we minimise the impact on our people as much as we can.
“I want to thank everyone across MAG for the dedication they have shown through the toughest summer our industry has ever seen. MAG and other UK airports remain fundamentally strong businesses that will play an important role in driving the country’s recovery, but the specific and short term pressures of the pandemic are exceptional and particularly challenging for our sector.
“We are proud of our long-standing role in supporting communities around our airports and underpinning the employment of more than 130,000 people across the UK. We will continue to work to protect as many jobs as possible, maintain dialogue with our trade unions, and continue to make the case to Government for the direct support that UK aviation needs.”