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Coronavirus: Ryanair threatens job losses if pilots don't accept pay cuts

A Ryanair plane. (Nick Potts/PA Wire/PA Images)
A Ryanair plane. (Nick Potts/PA Wire/PA Images)

Ryanair (RYA.L) said it would shut down two bases and cut 120 pilot jobs in Ireland, its home market, unless the pilots bypass their union and accept a 20% pay cut, according to a memo seen by Reuters.

The airline, which resumes flights on 1 July, is demanding pay cuts of up to 20% for flight crew and 10% for attendants across Europe, to “compete with rivals that have received state bailouts.” However, it faces resistance from trade unions.

READ MORE: Virgin Atlantic to restart flights to 17 additional destinations

In the memo, director of operations Neal McMahon told pilots the union council representing Irish pilots had walked away from talks. But Forsa, the second-largest trade union in Ireland, has denied this.

McMahon also said a union request for an extension of a 30-day consultation on job cuts was a "stalling tactic."

The memo sent on the company's internal messaging system asked pilots to click a button to accept a pay cut of up to a fifth of their salary, which would be “gradually reversed” over four years.

It also asked them to agree to split up available work via job shares and unpaid leave, as well as several "productivity improvements."

A Ryanair spokeswoman told Yahoo Finance UK the company has "nothing further to add to [the memo].”

READ MORE: Coronavirus — Holiday bookings surge as travel rules are relaxed

The number of job losses, and whether bases at Cork and Shannon airports remained open, would depend on how many accepted.

Forsa, which called the proposal “unacceptable” as it would leave pilots on zero-hour contracts and provide no guarantee job losses would be avoided, said it has requested third-party mediation but not yet received a response from Ryanair.

French flight crew have accused Ryanair of “redundancy blackmail” by similarly informing them they risked losing their jobs if they didn’t accept pay cuts.

Earlier this month, Europe’s biggest budget carrier warned it may have to cut up to 3,000 jobs — 15% of its workforce — as it faces a slow recovery from the impact of the COVID-19 pandemic.

Despite making profit of €1bn (£894m, $1.1bn) in the year to 31 March, the financial year ahead will likely be “difficult” and “uncertain,” as it may take up to two years for passenger levels to return to 2019 levels, it said.

Meanwhile, airline Jet2 is proposing to cut 102 pilot jobs, the British Airline Pilots’ Association union said last week.

The Leeds-based carrier is not due to recommence flying until 15 July by which time it will have grounded its entire fleet for more than three months.

The travel industry has been hit hard by the pandemic but things are starting to look up as lockdown rules ease. In the UK, holiday companies have seen bookings surge as COVID-19 travel restrictions are set to be relaxed next week.