The deal will see pilots take a wage cut of 2.61% on their basic pay from October this year, together with a 20% reduction in flying time allowances. This will generate £16m annual savings.
The productivity part of the deal includes an increase in annual duty hours, the delivery of shorter turnaround times on short-haul flights and reductions to the crew arrangements on certain long-haul routes. This will generate £10m annual savings.
In return, BALPA said pilots would benefit from a ‘groundbreaking long-term incentive scheme’.
In June 2011 they will be eligible to receive BA shares worth £13m if certain company targets are achieved. The pilots will individually have to retain these shares for three years, when they will be free to sell or keep them.
BALPA will put the package to its members with a recommendation to accept. Of BA’s 3,200 pilots, 95% are BALPA members.
‘This is a unique agreement,’ said BALPA general secretary Jim McAuslan. ‘We have always said that as a union we would share the pain if our members shared in the gain.
‘We have been doing some intensive research and polling over the last two months. Our research indicates that BA is facing a real business challenge and this is not the case of the employer crying wolf.
‘Our polling of BA pilots over the last two months indicates the approach they want their union to take in responding to that challenge. We believe we have delivered on that and are therefore hopeful for a strong Yes vote.'
The package also allows for up to 78 voluntary pilot redundancies as a result of the productivity changes, but it does not call for any compulsory redundancies.
McAuslan concluded: 'This is groundbreaking and is a reflection of the unprecedented trading environment.
‘BALPA recognises that the potential for significant reductions in the flying programme due to BA's intention to ground up to 16 aircraft may yet lead to further challenges over pilot surpluses. That is a challenge that we shall rise to, if it occurs.
‘But BA pilots by themselves will not deliver the change needed to see BA through this downturn. We hope that everyone in the company will do their bit so that we all come through fit to thrive in this toughest of market.'
See also:
BA calls on staff to work for free (17/06/2009)
BA plans further cuts after record loss (22/05/2009)
BA/union talks continue as 300 jobs go (03/04/2009)