Management at Shannon Airport have informed staff of the need for voluntary redundancies and pay cuts as part of plans to implement substantial reductions to the airport’s cost base.
A Shannon Group spokesperson has confirmed that in light of the catastrophic impact that the COVID-19 pandemic has had on the aviation industry, the CEO of Shannon Group has written to staff at Shannon Airport on a series of proposed cost reduction measures. As we are in dialogue with employees and Union representatives it would be inappropriate to comment further.
In the letter to workers, airport CEO Mary Considine said that as a result of the Covid-19 pandemic the airport is expected to have suffered a 70% drop in passenger numbers by year end and that economic forecasters and airlines are predicting that air services will not be back to 2019 levels for at least three years.
The letter states that “the outlook for the year and beyond and the scale of the challenge we are facing is unprecedented.
Ms Considine said: “As a result of the crisis there was an immediate and unprecedented decline in our revenues and in response, we made some difficult decisions.
It is now clear that these activities are not enough to bring the airport to anywhere close to breakeven in the medium term. What is required is further and more substantial reductions to our cost base.”
Management say they will consider applications for career breaks of between 6 months and three years. The airport will also consider applications for temporary or permanent reduction in working hours.
The Shannon Airport Authority (SAA) will also launch and voluntary severance scheme which will include the statutory redundancy payment of two weeks pay for every year of service plus one week plus an ex-gratia of four weeks per year of service. The total sum will however be capped at 104 weeks.
Those who volunteer for the scheme will also receive a €5,000 lump sum payment for re-skilling, training and education support.
Some staff are already working reduced hours or have been temporarily laid off and this will continue until the business recovers, staff have been told.
Management say they will engage with employees and union representatives as business levels change. The letter states that management will be calling on the government to retain the temporary wage subsidy scheme to support employment for as long as possible.
Workers earning over €30,000 will be expected to take a 20% cut in pay without a reduction in hours.
The airport’s management roles and activities will be reviewed while management structure will also be revised.
The letter says: “We anticipate that this payroll reduction will be temporary in nature” but “will continue until April 2023 subject to business recovery.”
Fianna Fáil TD for Clare Cathal Crowe has said the announcement is a premature step.
“This is a huge blow to not only the airport but also the county and region as a whole,” said Deputy Crowe.
“I feel the decision was taken prematurely and it would have been more prudent to wait to see is contained in the July stimulus package in terms of support for the airport.
“This week, I’ve been in contact with staff at Shannon Airport and Shannon Heritage and based on their stories, I’ve a list of 29 questions compiled which I will be raising directly with Mary Considine today.
I also intend to seek a meeting with Micheál Martin to discuss Shannon Airport and its future,” he added.