BA parent IAG pleads poverty while set on Air Europa

Unite takes case against IAG’s takeover to European Commission

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As we have previously reported on UNITElive, British Airways is set on its ‘fire and hire’ policy, by sacking 12,000 of its 42,000-strong workforce, and re-employing the remaining 30,000 staff on severely reduced pay and terms.

Yesterday, UNITElive posted a Unite video explaining BA’s finances – demolishing the airline’s claim that it must fire its workforce and rehire those that survive on inferior contracts.

Unite’s in-depth analysis of British Airways’ financial position reveals the true extent of BA’s plan to use the health crisis as cover to slash jobs, pay and conditions – so as to transfer ever greater sums of money to its Spanish parent company IAG and its shareholders.

Unite will be meeting IAG financial analysts in the coming days to explain why IAG can afford to see out this crisis without such drastic cuts.

And, quite incredibly, while the airline is claiming poverty, its parent company IAG is ploughing ahead with the purchase of the airline Air Europa, at a cost of over €1bn.

Meanwhile Unite has today (June 11) informed the EU commissioner for competition, Margrethe Vestager, that it intends to act as a third party opposing the acquisition of Air Europa by BA’s parent company IAG.

The union is now in talks with the DG Competition case team who will be investigating the takeover.

Strongly criticised
Unite has strongly criticised IAG’s decision to spend hundreds of millions of pounds on a new acquisition, while pleading poverty as an excuse to execute its brutal “fire and rehire” strategy on its BA workforce – stripping workers of their terms and conditions while cutting thousands of jobs.

Unite has identified a number of serious competition concerns with the potential to scupper the Air Europa deal. These include IAG’s increasing domination of the market for flights from Europe to South America; IAG’s dominant position at Madrid-Barajas airport; and the group’s return to a monopolistic hold over the Spanish domestic market.

These issues all make it likely that the acquisition would drive up ticket prices and reduce the number of fights on some routes, matters of serious concern to the European Commission.
“Unite is questioning why IAG is seeking to fire and rehire the workforce at BA while its parent IAG is ploughing ahead with buying an airline for over €1bn,” commented Sharon Graham, Unite executive officer.

“There are a number of reasons why this merger of Iberia with Air Europa would appear to be anti-competitive.

“The case team at DG Competition have been very open to us sharing our concerns with them. We are now gathering further detailed evidence from a number of expert sources and discussing the takeover with other parties that could be negatively impacted.

“We are confident that we have a strong case and we look forward to officially presenting all our evidence when Phase I of the investigation begins,” she added.

Bizarre twist
And in a completely bizarre twist reports in today’s (June 11) media are saying that British Airways is to put some of its renowned art collection up for sale – apparently in an attempt to raise cash – as it prepares to lay off thousands of staff.

The airline has called in art valuers and is planning to auction off at least 10 major pieces, some valued at more than £1m.

BA’s art collection includes works by British artists including Damien Hirst, Peter Doig, Anish Kapoor, Chris Ofili and Tracey Emin.

According to the Evening Standard, Sotheby’s has valued a number of works held by BA for a potential imminent sale, with one piece by Bridget Riley – described by some as a masterpiece, and raise millions for the airline.

The move comes as the majority of BA’s fleet remains grounded because of the Covid-19 pandemic, and the entire aviation industry facing an uncertain future.

Álex Cruz, BA’s chief executive, had promised to “take every possible action to conserve cash” when BA notified unions it was planning redundancies.

British Airways did not comment on the art selloff, but according to the Guardian a source said the airline was not ruling anything out to save money and jobs.

​BA is reported to have said, “We are acting now to protect as many jobs as possible. The airline industry is facing the deepest structural change in its history, as well as facing a severely weakened global economy.”

Unite, representing BA workers, is disputing the need for the firm’s mass job cuts plan – that’s 12,000 jobs to go with the remaining 30,000 staff to be ‘fired and rehired’ under worse conditions and pay – while IAG plans to buy another airline .

“The company is claiming to be in financial difficulties while BA’s Spanish parent company IAG is still planning to spend close to €1bn to buy another airline, Air Europa,” commented Unite general secretary Len McCluskey.


Fire and rehire

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Compiled by Amanda Campbell @amanda_unite

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