BA calls in negotiators over pay row

July 1, 2009

, LONDON, Jul 1 – Struggling British Airways said on Wednesday it had asked a conciliation service to help reach a deal with unions on pay and job cuts, in a bid to avoid the threat of a damaging strike.

Talks between BA and union officials over cost savings at the airline failed to reach an agreement despite a Tuesday deadline.

BA wants to cut more than 3,000 jobs and freeze pay as part of a huge cost cutting drive it says is necessary in the wake of a drop in flights caused by the global economic downturn.

"It has not proved possible to conclude an agreement with the trade unions on our pay and productivity discussions by the deadline of June 30," the airline said in a statement.

"We have therefore asked the conciliation service Acas to facilitate any future meetings."

The GMB and Unite unions have said they are willing to continue talks with management about cost cutting, but sticking points, including fears of compulsory job losses for the 40,000-strong workforce, remain.

Failure to reach a deal could lead to the threat of industrial action by workers over the busy summer months, heaping more problems on BA.

After diving into a financial loss, the airline last month asked staff to work for free, while promising that chief executive Willie Walsh and finance director Keith Williams would forgo their July salaries.

BA said 6,940 staff had volunteered to work for nothing, take unpaid leave or work part-time, helping the group save up to 10 million pounds (11.7 million euros, 16.3 million dollars).

BA last month reported an annual loss of 375 million pounds, blamed on plummeting demand for tickets as well as high fuel costs. The airline has cut 2,500 jobs worldwide over the past year.


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