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JOINT COMMITTEE ON TRANSPORT debate -
Tuesday, 26 Jul 2005

Aer Lingus Voluntary Redundancy Scheme: Presentations.

The purpose of this meeting is to discuss recent media reports on the Aer Lingus voluntary redundancy scheme. I welcome Mr. John Sharman, chief executive of Aer Lingus, and Mr. Greg O'Sullivan, company secretary and financial director. I also welcome Mr. Michael Halpenny, national industry secretary for SIPTU, who is accompanied by Ms Patricia King and Mr. Christopher McQuillan. On behalf of the committee I welcome them and thank them for attending our meeting today.

I draw the attention of witnesses to the fact that members of the committee have absolute privilege, but the same privilege does not apply to witnesses appearing before it. Members are reminded of the long-standing parliamentary practice to the effect that members should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable.

We will commence with a short presentation by Mr. Halpenny, followed by Mr. Sharman and then we will move on to questions and answers. I emphasise that people outside this room should not be mentioned by anybody because while privilege applies to Members of the Oireachtas, it does not apply to the witnesses. Yesterday's newspapers reported that people would be named and shamed, but that is not the sort of committee this is. I will ask anybody who tries to do that to leave because such naming would be unfair. We must all live with the rules governing our committee.

On a point of order, how does the Chairman intend to proceed with regard to members questioning the witnesses? Does he propose to separate the two groups?

I propose that the usual three questions will apply. After both submissions have been made, members will be entitled to put three direct questions, without preambles or additions, and we expect these questions to be answered directly without circumvention. I emphasise this because we hope to conclude this meeting by 1 p.m. and not to have people discussing matters that are not relevant to what is on the agenda for today.

May members ask three questions of the company and the union?

Priority will be given to committee members who may ask three questions of each group. If time remains afterwards, those who are not members of the committee will be allowed to put their questions.

Would it make sense from the point of view of procedure to deal with either the union or the company first?

If members want, we can deal with the union first and then move on to Aer Lingus. However, it is important to hear both submissions prior to dealing with either. We will hear both and deal first with Mr. Halpenny and then Mr. Sharman and Aer Lingus. I point out that both groups are limited to ten minutes to make their statements.

Mr. Michael Halpenny

I hope to conclude within ten minutes. I would like to read from the presentation I have supplied to the committee which deals with the recent revelations which in our view expose an intent in the minds of senior Aer Lingus management, past and present, which is completely at variance with the declared promise to the workforce, namely, that no employee would be forced out of Aer Lingus under the business plan. We now know that management's view was that what they euphemistically termed "environmental push factors" were key — I underline "key" — to getting people to go. We also know that the business plan also suffered from a euphemism and is and was intended to be only a cost-cutting plan. The real business plan for the future development of Aer Lingus is still a work in progress.

The effect of the recent revelations on our members and on the industrial relations process in Aer Lingus has been devastating. The planning in question goes back to the previous senior executive management who, we are advised, tasked the HR department with preparing the ground for the 2004 cost-cutting redundancy plan.

The first issue of concern is the promise, or what was the promise. When the business plan was announced, management assured everyone it was voluntary on both sides and that those who wished to remain in Aer Lingus could do so. In the notification to the Department on 19 August 2004, the company said this was a voluntary scheme and that final numbers would be determined by the degree of uptake across the Irish operations of the airline. It went on to describe that the proposed selection criterion would be voluntary severance or early retirement. Further, in a direct communication to the staff, it emphasised that it was a voluntary programme or scheme designed to be attractive to all age, service and salary categories; in other words, it was talking about a pull, not a push factor.

When discussions were held under the aegis of the LRC, the issue of exits came up. We agreed a memorandum of understanding, the principal point of which was that all exits under the programme would be voluntary on both sides. When the matter came before the Labour Court in terms of the quantum, of what the redundancy package would be, the company again emphasised that the scheme was voluntary on both sides. When management appeared before the national implementation body in January this year, it confirmed this. When we concluded a redeployment agreement in the event that redeployments would be necessary, one of the key points was to ensure all personnel would secure redeployment on a voluntary basis. That was the promise made to the workforce and repeated ad nauseam to various institutions of the State.

We had a premonition. We had been unhappy with the state of industrial relations in Aer Lingus for some time and when we met the previous Minister for Transport on 12 May, we told him of our concerns. We met the current Minister in October and also told him of our concerns about the lack of engagement with the trade unions and adherence to agreements. We subsequently wrote to him in that vein. When we appeared before this committee on 20 October, we told members about the difficulties against which we were negotiating, one of which was that entire groups of people, not just individuals, had told us they were being pressurised. Staff involved in catering and aircraft cleaning were being told their jobs were being outsourced above their heads. We told the committee that the company had put a gun to people's heads. At its worst, there are people who have said to us they have been pressurised. I said there was no point in putting a gloss on it; people had been told it was a case of "jump or be pushed". That was the issue we laid before the committee last October and our assessment.

Despite this, our members have been working through the problems that they face. We have been negotiating with the company against an extremely difficult background. Through the intervention of the national implementation body and the LRC, we have managed to turn the company away from outsourcing, in terms of aircraft cleaning and catering, to a more internal, direct labour solution. A study of the work carried out by our members on the ground to deal with the challenges being faced by them paints them in much more glowing terms than the company. At times the difficulties faced are akin to pushing treacle up a hill and are now answered in part by some of the recent revelations which refer to what are known as push factors. At the weekend I spent about half an hour flicking through some HR books and, lo and behold, came across the term "push factor", in reference to people exiting companies. It was not referred to in quite the same way as mentioned here but it is to be found in the literature. It is not a term with which I was familiar.

The union has enumerated a list of environmental push factors, Nos. 1 to 12, included in a document prepared by the HR department of the company for senior management. This is evidence which highlights the very clinical and dispassionate way in which the company sought to exert pressure on members to apply for redundancy. The document includes a statement that the environmental push factors are the key to securing applications and conversions — the people who apply and end up agreeing to go.

When the document came to light last Wednesday, we immediately contacted the chairman of the company who agreed to meet us immediately. We expressed the outrage of our members. In the course of the meeting and arising from it it emerged that the 30 page document had been prepared by management in preparation for the business plan. We asked for a copy of the document in question which I believe to be in general circulation. Management subsequently confirmed that eight management personnel had been involved in discussions on the matter. Four of the officials in question have since left the company.

Management officials, including the chairman, have stated the proposals outlined as bullet points in the document were never enacted as part of the plan. We have a difficulty with this statement because we recognise quite a few of the bullet points. In that regard, I draw attention to pages 7 and 8 of the presentation I am making to the joint committee today. It is certain that some people received a tap on the shoulder as reported by superintendent employees. European management officials were told to apply for their own jobs. Entire sections of the workforce were told their work was being outsourced. Far from receiving a tap on the shoulder, people working in such sections were, in effect, shoulder-charged out of their work. I would use the term "shoulder-charged". While we were able to stop this from happening, that is not the point.

A new performance management system for superintendents and specialists was proposed. An attendance management system was proposed in the business plan. Adverse changes in work shift patterns were proposed in the business plan and presented to each area. Members of the cabin crew and aircraft cleaning personnel have reported that they were invariably given late shifts when they had asked for early shifts. Changes in the availability of in-week special leave were proposed in the business plan. The working of contract hours was proposed in the business plan presented to the cabin crew. Changes to the uniforms of members of cabin crew and those involved in ground operations were proposed in the business plan. A sample of the canary yellow polo shirt, with accompanying logo, was placed on view for the staff to be affected by the changes but the proposal disappeared during the subsequent furore. I am indicating to the joint committee a type of uniform very similar to that proposed.

Delegates are not allowed to display items in such a manner.

Mr. Halpenny

I apologise.

Mr. Halpenny has already done it.

Mr. Halpenny

It is not labelled.

A significant reduction in overtime was proposed in the business plan presented to each area. I understand from my colleagues in the Irish Airline Pilots' Association that it was proposed to assign pilots to a resource centre. The association has indicated its views on the matter.

The removal of transport and the closure and reduction of bases were proposed in the business plan. With regard to the relocation of the head office, Aer Lingus undertook a site survey over several weeks last year. It confirmed as recently as yesterday that the project was still active. Staff at head office were told at one stage that they would be relocated to Swords. Regardless of whether all the proposals were intended to be included in the plan, they surfaced in some shape at some stage.

I would like to speak about the transfer of undertakings and the protection of employees referred to in the document I have distributed as TUPE. One of my colleagues will speak about the transfer of undertakings which became a issue. Employees were not told——

I am sorry, but the presentation is limited to ten minutes.

Mr. Halpenny

I will finish.

Mr. Halpenny has actually taken up all of his delegation's time.

Mr. Halpenny

I am sorry. I thank the Chairman for his indulgence.

We need full transparency on all these issues. Full responsibility needs to be taken by all the parties involved. The current set of circumstances is damaging to our members and the industrial relations process. I emphasise that we have been able to meet the challenges we have faced as a consequence of recent actions which we should never have had to deal with in the first place. If recent developments have demonstrated anything, is it that people should join a trade union.

Mr. John Sharman

In the past week Aer Lingus has been described as beleaguered and a financial shambles. Most importantly, it has been accused of engaging in 12 months of sustained and deliberate attacks on employees. I intend to deal with these points and outline the background to the 2004 business plan. It is unfortunate that the article appeared when the company believed it was close to reaching agreements with the trade unions in respect of work practice changes essential to its continuing viability. These result from initiatives taken in late 2004 and early 2005 to revive a stalled process of engagement. I trust this progress will not be wasted.

Far from being beleaguered, the company has advanced the business plan, launching new routes and further developing established ones, carrying 3.2 million passengers in the first six months of this year on its European network compared to 2.7 million last year. The airline continued discussions with manufacturers in respect of long-haul aircraft; with trade unions in respect of work practice changes; with the Dublin Airport Authority in respect of its infrastructure and has appointed a new chief executive who starts work on Monday week.

Management, staff and the company are not beleaguered. The suggestion that the company has engaged in 12 months of sustained and deliberate attacks on employees is without foundation. I will deal in detail later with the internal document the Irish Independent obtained by means unknown.

I will deal, first, with some of the background issues. It has been suggested that Aer Lingus is a financial shambles. This was true in 2001, following the terrorist attack on the World Trade Centre in New York on 11 September 2001. While the airline experienced trading difficulties in the early part of 2001, that event turned the position into a financial crisis. Unlike many other major airlines, Aer Lingus reacted quickly by developing a survival plan, in consultation with the trade unions and staff, which involved radical cost-cutting measures and ensured the airline's survival. However, the plan quickly went out of date. For example, it assumed that business class traffic would rapidly return to its prior levels whereas it became clear early on that this was not likely to occur. Aer Lingus recognised that the short-haul market, in particular, demanded low fares and that there were plenty of carriers able and prepared to offer such fares.

To compete profitably in this or any market an airline must have a cost structure that enables it to support its offering to its customers. Aer Lingus identified further significant costs it could take out of the business, particularly in the area of distribution. This enabled it to relaunch itself successfully as a low fares airline whose customer proposition is far better than that of any of its competitors. Following its close brush with bankruptcy in 2001 and subsequent survival plan, €340 million was taken out in costs by 2003. Of this, 18% related to staff costs, particularly in senior management posts where numbers were reduced by 58%.

Even with these improvements, the basis of the business was not secure in the competitive environment in which the airline operated. Competition continues to intensify and it is perilous to allow our costs get out of line with those of our competitors. Customers will vote with their feet, or by a click on the web, if we seek to charge the fares necessary to recover excessive costs. That is not to say we attempt to offer the lowest fare at all times but that our goal is to offer a low fare product which the customer believes to be good value.

Aer Lingus has a very strong brand, synonymous with high levels of customer service which differentiates it from its competitors. However, the job is far from complete and the 2004 business plan was drawn up to secure its future. The plan focused on exiting from unprofitable lines of business, cementing the low cost model in short-haul operations, developing the ability to expand long-haul operations, obtaining voluntary redundancies and work practice change to improve productivity. It continues to develop the strategy to which I referred and adds considerable capacity to the short-haul fleet. Aer Lingus has shown that people will fly if the fare is low enough and the plan recognises this by further reducing fares and adding extra attractive destinations. An integral part of the plan is to put a cost structure in place which delivers an adequate return on the capital invested by the shareholders and enables the airline to take advantage of further profitable growth opportunities. Significant cost reductions were needed to achieve this objective, including further declines in the permanent workforce.

The plan approved by the board on 26 July 2004 provided a significant sum to ensure the success of the voluntary redundancy scheme which was announced to staff in August 2004 with applications to close on 15 September that year. At the request of the trade unions, the scheme was extended for acceptance to 15 October 2004, when it was closed with more than 1,600 applications received in the short time against thetarget of approximately 1,300.

Since the closure of the voluntary redundancy package, I have become involved in direct dialogue with the major trade unions in Aer Lingus to seek consensual work practice changes in the context of the business plan. At no stage in these meetings has it been suggested to me that the company or management acted unethically in the implementation of the business plan. The company has now completed approximately 1,000 individual interviews with staff in connection with the scheme, 20% of which resulted in a decision by the staff member to remain within the company. In none of these interviews was the suggestion made by anybody that unethical tactics had been adopted. Further, neither I nor my board would have tolerated such behaviour.

The downsizing of Aer Lingus to ensure its long-term survival as a relevant and profitable air carrier involved stresses and strains normal in any large company in such a position. It is also axiomatic that such changes must involve all stakeholders consensually to ensure the survival of a robust entity. This has been my position throughout my time as chairman and acting chief executive in the last eight months. It was also the position of the previous chairman and executive management team.

As I indicated at the release of the airline's annual results in April 2005, progress in implementing certain aspects of the business plan has been slower than I would have liked. This is inevitably reflected in the current financial performance. Fuel prices are also a considerable concern to the airline. While the airline's fuel hedging policy has sheltered it from the worst effects of the current high fuel prices, its fuel costs will continue to be significantly over-budget for the year. Ultimately we will be faced with market rates for fuel and we will have to respond accordingly. To date the airline's revenues——

Chairman, on a point of order, Mr. Sharman is not addressing the issues on the agenda. We have heard much background but nothing to do with what is on the agenda.

With all due respect, Deputy Glennon, Mr. Sharman has been allowed time to make his presentation. What he wants to put into it is his business. He should be allowed to do so.

Members of the committee have a right that witnesses——

Mr. Sharman will continue.

——address the point at issue.

Let Mr. Sharman continue because——

This meeting is about the document and I would welcome if Mr. Sharman would address the document in question.

I ask Deputy Shortall not to waste the time available to members to ask questions.

That is precisely the point I am making.

Mr. Sharman

In this context, I would like to deal with the document referred to in last week's press. This has been entirely misrepresented by the media and other parties. It has widely been presented as a plan. A plan has specific objectives, defined actions, gives responsibility to individuals for those actions and has deadlines and measures by which to assess its success and failure. This document has none of these; it simply never was a plan.

The business plan was the only strategy or plan adopted as a policy by the airline in 2004. The elements, which I have noted earlier, were widely publicised and are still being actioned in part today. While the leaked document was used to help assess key human resources issues and how to approach them in delivering the human resource element of the plan, it never formed part of that overall business plan.

It is important the committee is clear as to how it came into existence and was used. It was collated by the company's human resources team which received inputs from different areas of the business that identified issues that would need to be considered and discussed before proceeding with the voluntary package. It was, therefore, a discussion document. The committee will note that several points raised have never been carried forward, such as the specific details of the proposed severance package which was changed in subsequent discussions and documentation. Several policies have been put in place over recent months that are completely at odds with what is discussed in this document. The document was never embraced or approved by senior management team or at board level. As executive chairman of the airline, I never saw the document until early last week. This is the extent to which the document was live in Aer Lingus.

Senior management in Aer Lingus do not condone and have never condoned bullying or harassment within the airline. Policies are in place to protect the respect and dignity of our staff. As the person with ultimate responsibility for the management and running of the airline, neither I nor my senior management team would ever condone such tactics to be employed at any level.

Lest there should be any accusations that we are glossing over the matter of environmental push factors, I will be clear as to what they are in any business, why they exist and why they were discussed. To understand this clearly and in context we must return to the starting point of the business plan. The market was changing. The business had to change. Extensive savings were required to deliver a sustainable future, and staff reductions were deemed necessary as an element of those savings. A figure of 1,300 people was deemed to be required in that respect. Our desire was always that this would be on a voluntary basis.

In any business, people will leave of their own accord only if there is an attractive financial incentive to do so and there is reason to believe that life outside looks better than it is where they are at the moment or holds the prospect of being so for the foreseeable future. It seems obvious but if everything in the business is rosy, people will not leave of their own accord and there is no need to ask them to. In planning a voluntary scheme, therefore, any management team must assess if there are enough elements in the business that will contribute to any given individual forming this view that this is not for him or her and that he or she will take the package. If there were not, then a voluntary scheme would not work.

As part of its planning, Aer Lingus management therefore had to assess whether any such factors existed in and around the airline or in and around the plan. Twelve such factors were elucidated in the document, some of which were already a reality at that time — decisions previously taken and still being enacted from previous plans — others that would emerge as a consequence of the decisions that were to be taken in the business plan, and others that might come under consideration in the foreseeable future. This yielded the page headed "Environmental Push Factors". I do not propose to deal with them one by one but I am happy to take any questions on a one-by-one basis.

I reiterate that this document was not a plan of action, as has been misreported. While I have regrets, I do not see or have any basis for which to apologise for the document. My regrets are many, the first being that I should be addressing the committee today on these subjects. I regret that to ensure the survival of Aer Lingus in robust form, so many of our people have had to leave the company. I regret that the pressures of the modern marketplace in air transport cause the stress of work practice change and productivity improvement for our staff. I regret that the language of business plans and planning has been selectively leaked and deliberately misinterpreted, causing our staff further anxiety.

However, I do not regret forming or supporting the formation of these plans. Without such work, in which I fully acknowledge the positive role and attitude of our staff both past and present, we would not have a future to work for or on which to negotiate. Of late, the management of Aer Lingus, with my direct involvement, has been negotiating with the trade unions plans for our staff to deliver savings through insourcing rather than outsourcing. We have been trying to reach agreements which would allow our long-haul business to expand through fly-anywhere agreements. These are the discussions and processes which present the real ethos of Aer Lingus. The company and the trade unions need to conclude these discussions so that management and staff can get down to the business of taking Aer Lingus through the transition to sustainable profitability and to its rightful place as a peer among the leading European airlines.

The air transport industry rightly awarded Aer Lingus the Phoenix award. The company is seen as a leader in the industry through its business transformation. Building on this should be the legacy of the past years of transformation that we can all support and nurture together.

I wish to put one question to Mr. Halpenny and to Mr. Sharman. Were any complaints made to Mr. Halpenny by members of the unions anywhere in Aer Lingus over the past year about "shoulder-tapping" or other pressures being applied to staff with regard to forcing them to accept the voluntary redundancy scheme?

Mr. Halpenny

As recently as last night——

Were such complaints made prior to the appearance of the articles in the newspapers last week?

Mr. Halpenny

Yes. Individuals complained at a general meeting.

How many?

Mr. Halpenny

I cannot recall. Representatives in the customer relations department complained about pressure.

How many complaints were there? Were there any written complaints?

Mr. Halpenny

I will have to refer to my colleague because he is more familiar with what is happening on the ground, but I believe there have been a number of bullying and harassment cases.

How many written complaints were there about shoulder tapping or people being forced into accepting the voluntary scheme?

Mr. Christopher McQuillan

In the first instance, a number of complaints were dealt with under——

I asked a specific question. How many written complaints does the union have?

Mr. McQuillan

Three complaints are being dealt with under the company's——

Are they in writing?

Mr. McQuillan

——respect and dignity policy.

Are they in writing?

Mr. McQuillan

Can I answer the Chairman's question the way I want to?

No, the witness will answer the question the way it is put. I want a direct answer to a direct question.

Mr. McQuillan

I am sorry.

Did the union have written complaints as regards shoulder tapping?

Mr. McQuillan

Yes.

When did it receive them?

Mr. McQuillan

Over the duration of the last 15 months we have had complaints from individual members. Individual members were written to by the company who were not coming forward for the package. A letter is on the record, and my colleague has a copy of it if the committee wants to see it, where superintendents who had not come forward were written to before Christmas. The letter expressly states that they were being written to on the basis of their reluctance to come forward. Information that they had never sought on the value of individual severance packages was set down for them in that letter.

I asked Mr. McQuillan a question. Has the union had written complaints from specific members about people being tapped on the shoulder or asked to take the voluntary redundancy package?

Mr. McQuillan

The answer to that is "Yes".

How many?

Mr. McQuillan

Three are being pursued under the respect and dignity policy. Others are in transition.

When were they lodged and when was the company notified about them?

Mr. McQuillan

Over time people have become more confident in wanting to——

I asked Mr. McQuillan when the company was notified about these. Was it in recent weeks or six or 12 months ago?

Mr. McQuillan

We meet the company on a regular basis and we have made collective complaints to it repeatedly——

However, complaints have not been made as regards individuals.

Mr. McQuillan

They have. I just told the Chairman that three complaints are going though the company's respect and dignity policy procedures. One of the complaints has already been upheld.

That is fine.

Mr. Halpenny

Perhaps I can help the Chairman on this. We had a meeting with the chairman of the company last week. I believe he will acknowledge he was told by one of our colleagues at that meeting that when the revelations emerged, people had come to that person to say they were so ashamed and demoralised at the attitude of the company towards those long-serving superintendents who had received a tap on the shoulder that they did not even tell their partners. It was only when it became public knowledge that they then told their partners. They had not even told the union. That is how badly people felt.

To understand the psychology of this, I received a phone call last night, as I was working late, from a reasonably senior employee in Aer Lingus who told me he had taken legal advice. This was to the effect that if he were to take a constructive dismissal case against the company, the maximum he could get under the Unfair Dismissals Act was 104 weeks' or two years' pay. Given his record of service within the company, under the redundancy plan he could get more and he made a pragmatic decision. Any working person would feel aggrieved and would want to get out in the circumstances and he decided this was the only way to do it. That is the psychology of the situation and it explains——

As national industry secretary for SIPTU, did Mr. Halpenny make any written complaint to Aer Lingus in the past 12 months on behalf of any of the company's employees about the proposed push being applied?

Mr. Halpenny

I went further and spoke to two Ministers about the state of industrial relations in Aer Lingus. The previous Minister for Transport expressed surprise and said that this was at variance with what he was being told in May last year about the general conduct of the negotiations. We complained to the current Minister in October. I wrote to him by letter — it is in the appendix of the documentation I have given the committee — to complain that the company was not engaging and that it was ignoring agreements.

Mr. McQuillan

A letter is on record that was sent to the company and to the Labour Relations Commission. Some 63 copies of this letter were sent by the union to aircraft cleaners during the course of negotiations on a solution in regard to aircraft cleaning by way of direct labour rather than outsourcing.

Our purpose is to discuss thefamous document in question. We wish to discover whether Mr. McQuillan made complaints with regard to tapping prior to the revelations of last week or whether this is a belated attempt to deal with something which may or may not have been happening.

Mr. McQuillan

The letter in regard to aircraft cleaning to which I refer is dated January 2005.

That was part of the negotiations on outsourcing——

Mr. McQuillan

No, it was not.

——to which Mr. Halpenny has referred in one of the documents he has provided.

I wish to put a question to Mr. Sharman. Has Aer Lingus management received complaints from the union at any level in regard to shoulder tapping or people being requested to take the voluntary redundancy package?

Mr. Sharman

Not to my knowledge. At none of our recent meetings with the LRC, the general secretary and both unions has the direct accusation been made that staff in any section are being bullied. I endorse and reinforce Mr. Halpenny's observation that the industrial relations background was not good.

Earlier this year, when I had greatness thrust upon me for reasons beyond my control, I decided the company should engage more closely in trying to do our business ourselves. This is the reason for the discussions that have been taking place for the past eight months. I wish to help Mr. McQuillan out on a simple question of fact. The letter to which he referred was sent in December 2003 and was not part of this business plan. It was sent by the management at that time to reinforce a different voluntary severance package. It is absolutely agreed that the letters were sent but I do not wish to comment on whether they were good letters to send. They were not sent selectively but to each person in the superintendent grade. It was nothing to do with this document.

Mr. McQuillan

That is correct.

Will Mr. Sharman confirm that these letters were sent in 2003 and not, as Mr. McQuillan has said, in 2004?

Mr. McQuillan

I did not say they were sent in 2004.

For the information of the committee, Mr. McQuillan should have stated the other letter was sent in 2003——

Mr. McQuillan

May I respond?

——rather than 2004, which gives a different slant to the issues in question.

Mr. McQuillan

We are trying to establish the mind-set of the company——

I ask Mr. McQuillan to refrain. I call Deputy Connaughton.

It is not appropriate to harass the witness.

I have not done so.

I believe the Chairman is harassing the witness.

Mr. McQuillan

I agree.

It is a requirement on the Chairman to be impartial in the conduct of the business of this committee.

I hope I am impartial.

I do not believe that is the case.

Does Mr. Halpenny believe Mr. Sharman and his board of directors saw the document in question?

Mr. Halpenny

Mr. Sharman told my colleagues and me last Wednesday that he did not see it.

I asked Mr. Halpenny whether he believes Mr. Sharman saw the document.

Mr. Halpenny

I do not believe Mr. Sharman saw it.

Does Mr. Halpenny believe any members of the board saw it?

Mr. Halpenny

My belief is that executive members of the board saw the letter because I was told by members of senior management that eight of their number had an involvement in what they term the discussions on this document. Four of these persons — three of whom were senior members of management, including two executive directors — have since left the company. It is my belief that as members of the board, they would have seen the document in question.

We will come back to this point later because I have some other questions for Mr. Halpenny. Does he consider the current industrial relations regime in Aer Lingus is a cesspool?

Mr. Halpenny

I will not make an assessment in this regard because I have never described it as a cesspool. That is the type of hyperbole we do not need.

Will Mr. Halpenny explain how industrial relations are at this stage, given what we have all heard, because this is a remarkable document by any standards? If I were one of the employees who left Aer Lingus and saw this document afterwards, I would have many questions to ask. From the perspective of a senior union official, could Mr. Halpenny give us some indication of how things are?

Mr. Halpenny

I have been a paid official for 25 years and a shop steward for 30 years and have organised my own workplace. I have never seen a document like this. I do not know whether it is a cesspool but one can apply what I call the duck waddling principle — if it looks, quacks and walks like a duck, it is a duck. Given that I have a plan here which I was told was not implemented and a list of actions which I have clearly identified as having been enacted, I am left with no other conclusion. I have never seen such a plan in all my years as a shop steward, union member and paid official.

Mr. Sharman knows, or should know, much more about the business of Aer Lingus than I do. Everyone wishes Aer Lingus well and wants its management to continue to ensure that it is an airline of which we can be proud. This document was not something that was done as a thesis by a student. Someone put a considerable amount of thought into it. It is not a frivolous document and a considerable amount of professionalism went into it. Given its status, why did Mr. Sharman not see it?

Mr. Sharman

The document was part of the documentation and discussions between the management and the various departments. All the line departments were included, in addition to the human resources department. This resulted in the preparation of the actual business plan. This is why I referred to them as discussion documents. I do not mean to denigrate their language by doing so. There would have been discussions going on between senior management and line managers at that time as to how the savings behind the business plan would be yielded.

There are other documents relating to, for example, the possible effects of the removal of business class from long-haul travel. None of this happened. These documents were discussion documents and did not go to the board. The board received the final product of a number of documents like these. This was just one small piece in a total jigsaw puzzle that resulted in the business plan.

Mr. Sharman still did not see this document.

Mr. Sharman

Absolutely not.

Was he not told about it?

Mr. Sharman

Absolutely not. I assure Deputy Connaughton that it went nowhere near the board.

I will bow to the instructions of the Chair and carry on with my remaining questions. To an outsider like myself reading this document, particularly page 15 where a magnificent crew is talked about — I suppose they will become known as the magnificent eight — the central philosophy appears to be who Aer Lingus needs on its side. Aer Lingus needs everyone on its side except the workers, as far as I can see. They are the only people not mentioned in this document. That is some philosophy for an employer to have.

Regarding the eight unnamed individuals in the report, and I will bow to the Chair's ruling that we do not ask for their names, I assume they hold very senior positions in Aer Lingus. Can Mr. Sharman tell us why there was no mention of the members of the workforce of whom he spoke so glowingly in his introduction? Why would a strata at any level in Aer Lingus want to walk on workers? The latter is evidenced by the fact that workers are not mentioned in this document. Is there a hidden philosophy in the organisation that the workers come last?

Mr. Sharman

I assure the Deputy that this is not the philosophy. The paper includes a section on who we need on our side.

Yes. It is nice line-up.

Mr. Sharman

It refers to senior trade union officials, the LRC and the Labour Court. Communication with the trade unions was stressed within the document. The slide immediately preceding that refers to employee communication and engagement. The plan was communication with our staff, namely, why, what, where, who is affected and how and communication with and the provision of documentation to all staff via all channels. It states that the executive team, following communications with the CRC, should do a road show. It then deals with communication of exit terms, individual letters and various means of communication. The two matters were different. There are two channels of communication for a company with its staff. One is directly through all of the structures and formats, such as the CRC. The negotiation framework in respect of staff lies very clearly with the trade union representatives and the CRC, which is what this paper deals with.

The Deputy's other question relates to whether there was then, or there is now, a central ethos of ignoring what our staff feel and so on. As far as I am concerned, there is not. There is a recognition by the board and me that in a service business, the service is the staff. The performance of the business is entirely down to them.

Judging from this document, I put it to Mr. Sharman that eight senior persons, who were formerly or who remain with his organisation, do not hold his view. As he can appreciate, there are many questions concerning a document such as this. In so far as the leak is concerned, which was mentioned in Mr. Sharman's opening remarks, would it be true to say that someone at a very senior level must have received two taps on the shoulder?

Mr. Sharman

I cannot comment on the matter.

Given that there were so many taps on shoulders, it reminds one of the film "Schindler's List". It must surely have been a very disgruntled person who decided to make this — even though Mr. Sharman and the board members did not know of its existence — public a year later.

Mr. Sharman

I find the timing of the release of this document interesting. I find the nature of its release despicable, to use a word — which I resent — used about the company. The only intent was to create anxiety and a feeling that, somehow or other, Aer Lingus, as a company, had a policy of intimidating its staff. I would like to meet whoever leaked the document. I do not know who did so.

It is a mistake that IMPACT, given its involvement, was not invited to come before the committee.

IMPACT has never been invited to come before the committee, as the normal procedure is to invite Mr. Halpenny, the national industry secretary for SIPTU, to do so. IMPACT has never come before the committee in my time as Chairman.

I understood that it had. Is it not the case, Mr. Halpenny, that the purpose of this meeting is to establish the status of this document and whether the policy was put in place by the company or whether any attempt was made to implement it, particularly the environmental push factors? Is it not the case that, at the 20 October 2004 meeting of this committee, Mr. Halpenny outlined in some detail complaints and a culture that were entirely consistent with the type of approach indicated in these environmental push factors? Is it not also the case that, at the 4 October 2004 meeting, a number of committee members raised such issues with the then chief executive? They were very much on the record long before any knowledge of the existence of this document.

With regard to the 12 environmental push factors, the SIPTU presentation made reference to several of them and it appears the company was intent on implementing each of these actions. How many of the 12 measures did the company intend to implement? On how many of these measures did IMPACT have to take action, in terms of writing to the company or of discussing the matter with the Labour Court?

Mr. Halpenny

Virtually all 12 of these became a subject of confrontation, negotiation or, ultimately, removal. We have given examples of measures from which the company turned away. All of these were presented to us in some shape or form.

Is it the understanding of SIPTU that this was an agreed strategy being implemented?

Ms Patricia King

It is important to get a feel for what was happening. When this business plan was being implemented in July, the company stated it wanted to follow a process that would involve presentations by departments. These concerned the cost savings and targets that needed to be achieved. The trade unions were invited to take part in these presentations in the Aer Lingus head office. Each department set out the cost savings it wanted to achieve and how it wanted to achieve them. I can identify where some of the 12 measures were introduced at presentation stage. For example, on the first presentation to the cabin crew department, the issue of the uniform was raised, as was the issue of the shift change. These issues were raised and it was clear what was being done and how it was being done. That is just one example.

At presentation stage, a company outlines what it wants to achieve and there is no time for discussion. The LRC assigned a facilitator to help the parties to come to agreement. Once the presentation on cost savings was made, according to the chief executive at the time, the trade unions had to find an alternative or come up with another way of making the cost savings. I was directly involved in working with each department to propose alternatives to achieve cost savings. I will provide two examples. In respect of the catering department, the company made clear what it wanted to do and the savings it wanted to achieve, which were in the order of millions. Some 234 workers have been employed in the catering department for a long period. Long service is a feature of this department. At the presentation, we understood what the company wanted to achieve and asked the questions we wanted.

The next stage in the process was to go to the LRC, under the facilitation of the chair, and attempt to come to agreement on savings. This was our understanding of the process. We arrived at the LRC and IMPACT and SIPTU had done much work on achieving savings and meeting targets identified by the company. We sought expert advice in this regard and had considered the matter of a voluntary redundancy package and how it could be achieved.

A presentation was made by IMPACT, SIPTU and the catering department on how the cost savings could be achieved. I led the discussions and felt that the company was dismissive of people who had gone to the trouble of making presentations, including slides. Anyone familiar with labour relations will know that there are side sessions and much waiting for others to make up their minds. Having spent two hours listening to our propositions, the company representatives disappeared for approximately two hours before returning. We expected them to make strong criticism of the proposals or to agree to some, while suggesting adjustments to others. I am conscious of the Chairman's warning with regard to identifying people but, when they returned, the most senior person present indicated that the company's view was that the catering division would be sold. As leader of a delegation of experienced shop stewards from throughout the catering division, I asked him to repeat what he had said through the chair.

It was clear that the chairman facilitating the meeting, even though he was in and out of the rooms, listening and providing assistance, did not know of this plan. I pointed out that the company representatives had spent an hour listening to our proposition and a further two hours outside but that before they came to the meeting, they knew the company proposed to sell the catering division. In addition, at the meeting, which went on late into the evening, progressed, they stated that the contract and tenders were ready. I stated that the company had a problem. Selling the division meant dealing with transfer of undertakings and engagements and the workers were entitled to an opportunity to enter the new company with the same terms and conditions as they currently enjoyed. I stated that this could not be done because it would mean breaking the law.

The company representatives spent some more time outside. They returned and stated their legal advice was that they were perfectly within the law. Neither of the people from the company appearing here attended at any of those sessions. They had no hand, act or part in those sessions. They do not know what happened because they were not present. I was there, as were 25 representatives from throughout the catering department who assessed, for themselves and the people they represent, the options available.

When I saw this document on Wednesday, I examined the list. Avoiding transfer of undertakings is part of the revelations in the document. I now know why that senior representative stated what he did and why people adopted the attitude they did on that wonderful night in November when I spent until approximately midnight arguing with the company. A strategy was in place.

I could repeat a similar scenario with regard to a group of cleaners in the company. I worked on the discussions for those cleaners. Perhaps it is important that the committee be given an insight into what happened that day. We heard the company's presentation on cost savings prior to that meeting. It wished to make cost savings of approximately €1.2 million. It identified the number of employees by which it wished to reduce the workforce. Shift patterns were a difficulty but I regarded it as part of the nitty-gritty of the cost savings the company wished to achieve.

We entered the room in the Labour Relations Commission. My colleagues in the union and the cleaning department did tremendous work to come up with a variety of flexibilities that would deliver the cost reductions. We were approximately €200,000 out but that is not far off the mark with regard to a saving of approximately €1.2 million. We were delighted with our work, as was the chairman, because we had been constructive, which is not a label usually associated with us. We set it out and I was happy, in a professional capacity, to present it. The representatives of the company sat across from us. I tried to rattle for a reaction and see if they could be positive about it. Eventually, the most senior person present stated that the company position was that cleaners cost €14.35 per hour and had a pension scheme, a sick pay scheme and good annual leave. He stated that the company intended to have the cleaning service provided at an hourly rate of €8, with no pension scheme or sick pay scheme and reduced annual leave within the law. He stated that, in order to facilitate the staff, an attempt would be made to find other work within the company on a redeployment basis or that they would otherwise be offered perfectly good voluntary retirement. I rest my case with regard to any of the 12 push factors listed.

Does Mr. Halpenny believe, notwithstanding the fact that a number of senior managers have left the company, that the culture and philosophy underpinning this strategy still exists within Aer Lingus?

Mr. Halpenny

If I may return to the point I attempted to make earlier, as late as last night I received a telephone call and I informed the committee about it. The culture remains, although I am not sure if it is merely the residue of that culture or if it is still there in its totality. While the committee has heard stories today about victims, the one promise that we have made to our members is that they will not be made victims on our watch. We have done, and will continue to do, our best to represent our members. We will not let this issue go and if the culture still persists at the company, we will do our utmost to ensure that it stops.

To correct the record, IMPACT attended this committee on 20 October 2004. It is unfortunate that it was not invited to today's meeting.

IMPACT did not make any request to attend today's meeting.

I listened closely to Mr. Sharman's presentation today and to his interview on "Morning Ireland" last Wednesday and was very disappointed that he did not take the opportunity, on either occasion, to condemn the philosophy and culture underpinning this document. He spoke about the status of the document and so forth, but most right-thinking people would believe that this kind of outlook has no place in modern industrial relations and is completely unacceptable. It is unfortunate, therefore, that Mr. Sharman did not take the opportunity to condemn it, apart all together from the fact that many of the proposals contained in the memo are illegal under our employment laws.

Mr. Sharman

May I respond to that point?

Mr. Sharman is entitled to respond.

Mr. Sharman

The Deputy spoke about culture but there is no culture of intimidation in Aer Lingus. I do not believe there ever was such a culture and I am certain that it does not exist under my watch. There was nothing, therefore, to condemn because in order to condemn something, it has to have existed as a plan. Deputy Shortall is portraying the 12 points in the document as a plan, which they are not. As I stated earlier, I am quite happy to go through the 12 points with the facts if that would be helpful to the committee.

I do not think that would be helpful at this stage, but if Mr. Sharman wishes to prepare a written submission on the 12 points, I will have it circulated to the members later.

Mr. Sharman

That is fine, I will do that.

I will also put that document into the public domain because there is no reason to keep it a secret.

It would have been helpful if Mr. Sharman's presentation had included a response to the 12 points because that is the kernel of the issue and the reason we are meeting today, namely to establish the status of this document.

Mr. Sharman has heard union representatives state that the 12 environmental push factors were being implemented by the company. Furthermore, many of the complaints that we, as public representatives, received last year would tally with that view. Is it not the case that two of the push factors, namely the proposed changes in shift patterns — which would put the squeeze on part-time workers — and the changes in the uniform were put formally to cabin crews and were the subject of a Labour Court hearing on2 February 2004, attended by the company?

The implementation of push factor No. 9, which proposed to assign pilots to a resource centre to carry out menial work, has been denied by the company. I ask Mr. Sharman whether a specific area was set aside for this purpose, equipped with telephones and computers, with the intention of locating pilots there to carry out menial work? Was it done with the intention of implementing these proposals?

I put it to Mr. Sharman that this document has the status of a company document which is being implemented. It was drawn up by the director of human resources, endorsed by the executive management team and a specific transition team was set up with the purpose of implementing it and its 12 environmental push factors. Is it not the case that the director of human resources, who was responsible for devising this strategy, still holds that position within the company?

It was made clear at the beginning that members should not identify a person directly or indirectly. Deputy Shortall has now attempted to identify a person.

I asked a specific question about the document.

The Deputy should withdraw the last part of the question and I propose it should be deleted from the record.

This is fundamental.

The Deputy has indirectly named someone which we said was not to be done at this meeting. I ask Mr. Sharmannot to reply to the last part of Deputy Shortall's question.

The question was about specific management practices.

The Deputy tried to name indirectly a specific individual which we said was not within the remit of the committee, and the Deputy is long enough a Member of the Oireachtas to know the regulations governing the indirect naming of people.

Are those responsible for this document still in senior positions within the company?

Mr. Sharman

The Deputy asked a number of questions about the 12 so-called push factors. I will try to answer each of them.

The reference to adverse shift patterns has been misrepresented in the media in a sinister way. They do not refer to cabin crew. Changes in the airline business mean that where once there were some 24 flights per day to European destinations, there are now approximately 45. The airline works more hours per day. The first departure is at 6 o'clock in the morning and the last is at 11 o'clock at night. The shift patterns ensure we can do our business during the peaks and troughs of the day. Most flights depart in the morning and return during the course of the day and then there is an evening wave. Shift patterns needed to change for those who load, push back and service aircraft. The previous shift patterns, agreed with our trade union colleagues, reflected a time when an airplane was left where it landed, rather than brought back during the course of the day. Some shift patterns would start early and others would finish late.

This is not an environmental push factor but a reflection of the requirement in the business plan for the workforce to work longer hours. The document attempts to persuade people of the merits of this. Some people do not want to get up at 4 o'clock in the morning to make sure that the 6.05 a.m. to Dubrovnik is pushed back on time for our customers. It is not an act of policy to give them unsocial hours. I am sure the Deputy takes early morning flights. Who does she think does all this work? It is done by people who volunteer for those shift patterns. To enable customers to fly on a 6.05 a.m. flight an airline needs people to do that. The document is referring to the fact that some of the workforce will simply not want to do that.

In-week special leave is, in essence, working on a part-time basis, and it is called in-week special leave in the aviation industry. Some 30% of our cabin crew are currently on in-week special leave, leaving a very high proportion of the Aer Lingus workforce on what is essentially a part-time basis. It is absolutely correct that the company provides possibilities for people with families and so on.

The allegation in the newspapers that the company was deliberately changing shift patterns and doing things that would disrupt family life particularly upset me. I would not do such a thing, as I value family life as much as anyone. The main point in this is that 30% of the workforce is a high proportion to have on a part-time basis. The lack of availability of in-week special leave was relevant to a future business plan, where the company could not afford such a high proportion of part-time working, and not a current policy.

The section in the 12-point plan refers to the lack of availability of in-week special leave. If the proportion is to go down from 30% to what the business plan stated, a figure which I do not have to hand, some people may not want to work for Aer Lingus if they could not be reasonably sure of the company offering them, on a restricted basis, the amount of in-week special leave they desired. This was not a plan to withdraw the leave, change shift patterns or interfere with family lives.

The next point in the plan referred to uniforms, or specifically to a change in uniform. The uniform ensemble for female staff costs €2,000 per person. It is a designer brand. For male staff, the cost is €1,400 per person. The uniforms are supplied by a single supplier, so these figures were easy to retrieve. I asked the supplier if it was asked to do anything with regard to uniforms. The supplier answered that it was asked to see if there was scope for saving approximately €500,000 per year by changing the materials from which the uniform was made and some of the items of detail. A mannequin or model was never produced. I read in the press over the weekend the idea of PVC trousers and t-shirts, but this was never considered. I will supply to members the identity of the supplier if it is required to confirm any changes asked for.

From where did the idea of the yellow polo shirt come?

It came from Dunnes Stores.

Mr. Sharman

I am glad the Deputy askedthat question. The idea of a t-shirt with the"aerlingus.com" logo on it has been used twice by the company in different circumstances. At the time, the management, with the support of the board, was attempting to establish in the public mind through advertising and other means the www.aerlingus.com website. The website has taken a significant amount of cost from the company’s cost base. The t-shirt referred to by the Deputy existed for the Paralympics held in Dublin. Aer Lingus was a sponsor and the official carrier for the Paralympics, and the t-shirtprovided, which was red and yellow with the “aerlingus.com” logo, was for publicity and not a uniform for cabin crew.

The second time the t-shirt was used was when Aer Lingus introduced the FastPass system. I am unsure if members have used the system but it is quite effective. A red and yellow t-shirt was produced with an "aerlingus.com FastPass" logo. The FastPass kiosks are also red and yellow. Both of these incidences of using the t-shirts have been very successful and I make no apology for their use. Over 60% of people who check in with Aer Lingus now use the FastPass kiosks, recognising them by the colour combination. When customers see the red and yellow kiosks they remember the people walking around about a year ago wearing red and yellow t-shirts. The passengers do not have to search for the kiosks as they are very identifiable. The t-shirts were never meant to be a company logo and have never been, or planned to be, staff uniform.

What were the proposals relating to uniforms that Aer Lingus put to the Labour Court?

Mr. Sharman

I am not aware of any that we did, to be honest. If the Deputy is talking about the Labour Court——

I am referring to last February, under overheads.

Mr. Sharman

Under overheads?

Mr. Sharman

Those are the ones to which I refer. If the Deputy is talking about the Labour Court proceedings, which resulted in us absolutely changing the way we are trying to do our business, those are the savings of €500,000 a year that were in the business plan. No mannequin has been drawn up. The manufacturer of the uniforms was asked if the image could be presented for a cheaper price.

No. I asked what proposals the company put to the Labour Court in respect of uniforms.

Mr. Sharman

None at all, particularly in terms of yellow tee-shirts and so on.

What were the proposals? The issue of uniforms arose at the Labour Court hearing last February as part of the cost cutting within the company.

Mr. Sharman

Yes. There was €500,000——

I am asking Mr. Sharman what the company proposed.

Mr. Sharman

It was a smart jacket and skirt, I think. I am going from memory because I do not deal with the detail of the uniform but it was a smart jacket and skirt for female cabin crew. It was a leather belt, I think, but no coat, and a handbag — and what we have today — with a smart shirt and slacks for male cabin crew, with a waistcoat, I think. I cannot honestly remember but the key was to make them out of slightly cheaper material.

I call Deputy Glennon.

There was no reply to my final question.

I asked Mr. Sharman not to respond to it.

No, not that part of it.

I call Deputy Glennon.

I am not talking about the part of the question to which the Chairman referred.

To which part is the Deputy referring?

I have put it to Mr. Sharman that this was a firm proposal, that it was endorsed by the executive management and that a transition team was set up to implement it.

Mr. Sharman

I was just coming to that. The answer is that it was not a firm proposal. It was a description of — I have just been through three of them — certain factors inherent in the business plan. Outsourcing was one, which was not actually discussed here. However, the change in shift patterns, as I have discussed it — those 12 points — were not the plan. The 12 points were trying to describe factors in the plan which would affect people.

There was a transition team, which was charged with ensuring that people who wanted to exit got the right information from the correct source in terms of their eligibility for voluntary severance. It was also charged with redeployment. Where people did not want to leave but where jobs would not, perhaps, be physically available, the transition team was charged with ensuring that jobs were found in different parts of Aer Lingus where there were surpluses and deficits. I think I am correct on that one.

I inquired about the status.

I call Deputy Glennon.

If Mr. Sharman is saying that this was a draft HR strategy, can he provide us with a copy of the final strategy to which the company was working?

Mr. Sharman

The Deputy is trying to grace the 12 points with being a strategy.

This is the only document that we have. It does not say anything on it about it being a draft. Mr. Sharman is saying that it is a draft strategy and I am saying that if it is, can he provide a copy of the final strategy?

Mr. Sharman said earlier that he was going to reply in writing with each of the 12 points.

I just want him to answer that question.

I have called Deputy Glennon.

Is there a final strategy document?

I have asked Deputy Glennon to contribute.

The purpose of this meeting is to discover whether this, as implemented, is a real document.

With respect, Mr. Sharman has already explained that he will deal with each section of it individually.

He said it was a discussion document.

He said he is going to deal with it.

I am saying that if this is a discussion document, is there a final document he can provide?

I have been lenient with Deputy Shortall and I am now calling Deputy Glennon.

I thank the Chairman.

The Chairman should also be interested in the matter to which I refer.

I am very interested in it.

I will be dealing with that particular issue. I thank the Chairman for convening this meeting on foot of a request I made last week. This is a hugely important issue, as can be seen from the unusually large attendance, both of parliamentarians——

Can the Deputy put his questions?

We have half an hour left. There are ten colleagues and I intend to allow each of them to contribute.

I will be brief.

To follow on from Deputy Shortall's question, this document is headed "Business plan, July 2004, HR strategy".

To the best of my knowledge, the business plan for Aer Lingus was announced in July 2004. The words "discussion" or "draft" are not mentioned in the document. Indeed, on the second slide on page 12 of the document, there is a further reference to execution of the business plan. I agree with Mr. Halpenny on what the calls his "duck theory". Taken in conjunction with much of the anecdotal evidence I have received in recent years, this is the HR strategy which formed part of the business plan. I ask Mr. Sharman to acknowledge that. If it is not, as Mr. Sharman appeared to suggest, could we have a copy of the HR strategy as adopted by the board?

I am very interested to know who exactly knew about this document. We have heard about eight people. Are they still in situ? I specifically wish to know if the chairman’s predecessor was aware of the document. One must remember the document is dated——

We said earlier we will not allow people to be identified. If answered, that question would identify somebody so it should not be answered by Mr. Sharman.

I share the regret expressed by my colleague earlier. I presume very extensive and probably expensive financial advice was taken in producing the document. Was legal advice taken on the document, particularly on the question of constructive dismissal?

Was Mr. Sharman serious when he said this is not the document on which Aer Lingus's methodology for moving forward the HR aspect of its business plan was based? It is obvious to everyone who has any dealings with Aer Lingus that it is. It is also obvious from the presentation of the document and from everything about it that it is. To continually deny that is to totally demean the integrity of the company, the management and particularly the workforce.

Mr. Sharman

I think the Deputy asked me three questions, one of which was the status of this document. It was a discussion document from which the business plan, which was approved by the board, was derived.

Did it form part of that business plan, as adopted?

Mr. Sharman

Not at all.

Can Mr. Sharman produce the HR strategy which formed part of the business plan, as adopted?

Mr. Sharman

That is contained in the business plan approved by the board which was a voluntary severance scheme.

Can Mr. Sharman circulate that to us?

Mr. Sharman

The Department certainly has it.

It is regrettable the HR department is not represented in the delegation.

Mr. Sharman

I think the answer to the Deputy's question is that most of it is in the public domain but I am happy——

Can we have the HR element of the business plan so that we can compare one with the other?

If Mr. Sharman is in a position to do so, he might circulate that with the other documents he proposes to circulate to the committee.

Mr. Sharman

I will circulate the final voluntary severance scheme which was adopted by the——

We are talking about the final HR strategy.

On the basis that this document was not adopted, there must be a subsequent one.

Mr. Sharman

I do not believe there is but I will certainly look.

Is Mr. Sharman telling us that the board adopted, willy-nilly, some other grey strategy while there was a clearly defined strategy which was not adopted?

Mr. Sharman

The board did not adopt, willy-nilly, an unclearly defined strategy.

Surely there is something in writing.

Mr. Sharman

It is called the business plan.

A human resources element of that plan must exist.

Mr. Sharman

The voluntary severance scheme is all that is in that plan.

What about the document that is secondary to this one? If this document was not dealt with, there must be a replacement for it.

Mr. Sharman

I do not think there is, but I will try to find out.

Thank you. Again, I express my regret that the human resources department is not represented here.

Mr. Sharman

On the second element, I believe legal advice was taken on all aspects, including withdrawing from new routes and so on and so forth.

Was there legal advice taken on this document?

Mr. Sharman

I do not think any legal advice was taken on that document because, as I keep repeating, that document has no status as part of a plan or a strategy.

However, it would have been taken on the subsequent document.

Mr. Sharman

I do not think there is a subsequent document. The Deputy has my undertaking that I will find out and that if there is, I will supply it.

We will presume that legal advice would have been taken——

We will presume there is none, unless it is supplied.

Mr. Sharman

The third question——

The third question referred to whether a former chief executive of Aer Lingus was involved. That question should not be answered because either a positive or negative reply involves naming somebody.

For the record, that question goes to the root of the issue as to at what level of the management of the company this plan was adopted and pursued.

So many birds have flown that we will never be able to get the answers.

They are clearly identifiable birds.

I welcome the delegations from the union and Aer Lingus. I have a brief question for Mr. Halpenny relating to a document I saw yesterday referring to the transfer of staff from an existing section to a proposed new outsourcing company. The document stated that these staff would not retain their Aer Lingus status, in other words their current conditions. Do the union or members have any written agreement with the company regarding the retention of staff conditions in such circumstances?

Mr. Halpenny

Not in the way the Deputy suggests. Most people here will be aware that we have consistently fought outsourcing from the start. The only agreement our members were interested in was staying within Aer Lingus, doing their work and negotiating with management. They saw this as the best way of securing their direct employment.

Is there no written safeguard in place?

Mr. Halpenny

The safeguard is in the law. It is in the transfer of undertakings regulations as amended, which provide that where there is a transfer of undertakings, the conditions and terms of employment, and the agreements covering those employees where there are collective agreements, are protected in terms of the transfer and that employees cannot be made redundant by virtue of the transfer.

In other words, the information from the human resources department is incorrect.

Mr. Halpenny

The whole human resources approach, as we said earlier, was incorrect as to the question of any possible transfer and the specific reference to that.

I participated in discussions yesterday with the union in regard to internal relation problems in Aer Lingus. As a former trade union activist, I was horrified at the allegations made regarding the treatment of staff and the manner in which information was transmitted to them. This would not be tolerated anywhere. Like Deputy Glennon, I would have preferred to question the Aer Lingus human resources team rather than Mr. Sharman because the problems in Aer Lingus revolve around internal relations.

Mr. Sharman has said repeatedly that everything is being misrepresented. The company must run on rumour and kerosene if that is the case. What experience has the human resources team got with regard to putting together packages involving shedding staff or rationalisation? How many people are on the HR team? Have they been involved in such schemes in other companies and can examples be cited? In the opinion of the delegation, are the criteria as cited in the document fair?

The committee has been informed about the redeployment of staff. Ms King outlined the situation very well and she has given the committee some idea of the manner in which staff were treated. I agree with Deputy Connaughton's point. These people put this document together. Are they aware of whether these schemes have worked in other companies and whether industrial relations difficulties were encountered? The committee must be given a clear picture of the situation. I do not disbelieve any side. As the Chairman stated, the committee must consider this matter in depth in order to establish the position. I have no reason to believe that the trade union people I met are telling lies when they say that their members were intimidated and that management told them to watch themselves because in a few weeks this place might not be here at all and they might be somewhere else. Will the delegation outline briefly what road map it would use for a scheme of this nature in order to reach a destination?

Mr. Sharman

That is a complex question. I stress that I was not in the position at the time of having to lay out this road map. The road map that needed laying out was that the company would be obliged to remove even further costs at the time at the end of 2003 and coming into 2004. This was the genesis of the business plan.

On the question of identities, I am informed that I am not allowed to identify people. Our HR team currently has six members. These people are mostly long-serving employees of Aer Lingus but some are not so long with the company. The HR team works in these circumstances with the direct management heads of the different sections.

Reference was made to the cleaning and catering sections. The HR team does not, as has been suggested, determine the strategy of the company. The business plan made a business decision that, for example, the cost of aircraft cleaning was too high compared to that incurred by the company's competitors, not just in Ireland but elsewhere. Aer Lingus does not compete solely with Ryanair and the focus of the company on just dealing with that one airline is wrong, in my view. Aer Lingus competes directly with British Airways on the transatlantic route and with American Airlines, Lufthansa and KLM. It is operating in an industry which is globally competitive and so it competes with everybody. The HR team does not determine those plans, which is the point I have been trying to get across.

The business executive determines the company's plans. One aspect of the business plan was to outsource aircraft cleaning because, with respect to my colleagues, the savings were a little more than those suggested here. The business decision was that the cost of aircraft cleaning needed to be reduced. The HR function is to decide the company has X number of cleaners and Y number of jobs. That is the challenge facing HR. Any company involved in downsizing finds this a huge challenge.

It is very difficult to get it right 100% of the time. The business decision is the thing that drives it. People working in human resources do not suddenly wake up one morning and decide to be nasty to everybody. The decision was taken for commercial reasons.

I do not deny that the board, of which I am a member, sanctioned the business decision. Without that decision, Aer Lingus would not have a robust future. The business decision drives that. I remind those who are arguing about who is responsible for all of this that the executive — the management officials — take the business decisions. Officials working in human resources then try to deal with the consequences of the business decisions in the best way possible. That brings us back to an issue that was discussed earlier — whether the document that has been leaked selectively constitutes the business plan. It does not constitute the business plan. I am conscious of the need to avoid identifying people. I hope my comments have been helpful.

That is fine. As someone with some experience of matters of this nature, I think that the officials working in human resources put the nuts and bolts together at the end of the day, for example by contacting staff. I do not know how it works in Aer Lingus, but I know how it operated in companies for which I worked. If staff were being shed or a rationalisation programme was being implemented, seminars and staff briefings would be held on a monthly basis, from up to 12 months in advance, to ensure that staff were kept informed. Financial advisers and other experts were put at the disposal of staff. Have such measures been put in place in this instance? We have heard that another company was earmarked by the management of Aer Lingus to be given the contract for the outsourcing of aircraft cleaning and that the company in question was paid over €600,000 for doing nothing. Is that true or false?

Mr. Sharman

They were paid €600,000 in advance of a contract — that is correct.

I have not heard anybody within Aer Lingus explicitly state that the company condemns the practice of shoulder tapping. Can Mr. Sharman do so?

Mr. Sharman

In what sense does the Deputy refer to shoulder tapping?

Does Mr. Sharman condemn the practice of shoulder tapping? We all know what I am talking about. Does the company condemn it?

Mr. Sharman

I will deal with the question in two ways. Before I speak about the circumstances of voluntary severance schemes, I will try to put the question back to the Deputy, who has used an emotive term.

It is not an emotive term.

Mr. Sharman

I understand.

We all know about the practice. We all live in the real world.

Mr. Sharman

I will try to——

Does Mr. Sharman condone the practice?

I ask the Deputy to allow Mr. Sharman to answer the question. I will then allow the Deputy to ask a supplementary question.

I will outline the nature of the practice that I would like Mr. Sharman to condemn or condone. It involves senior management officials within Aer Lingus contacting employees to tell them they will not have a future with the company if they do not accept the voluntary redundancy package offered to them. Would Mr. Sharman condemn such a practice?

Mr. Sharman

If it were done on a selective basis, I would condemn it.

He would condemn it.

Mr. Sharman

Can I please——

Does Mr. Sharman accept Mr. Halpenny's point that shoulder tapping constitutes constructive dismissal if it is pursued on an ongoing basis?

Mr. Sharman

I am not a lawyer. I do not know the constructive dismissal laws. If a company that employs 500 people is trying to downsize to 250 employees, how should the 250 people who are to be made redundant be selected?

It seems to me that Mr. Sharman would condone the practice of shoulder tapping in such circumstances.

Mr. Sharman

No. I was answering the Deputy, who has used an emotive term — "shoulder tapping".

It is not an emotive term. Shoulder tapping is a well-known practice throughout the business world. Everybody knows about it. Some people condone it and other people suggest that it is the only way to downsize a business. I would like to know whether Aer Lingus, which is in the process of downsizing, condemns shoulder tapping. I did not receive the sort of unequivocal answer I was expecting.

Mr. Sharman

The Deputy did not ask me an unequivocal question that is capable of being answered in an unequivocal manner.

I would like to outline why I asked the question by drawing Mr. Sharman's attention to page 9 of the document under discussion.

Mr. Sharman

My copy of the document is in a somewhat different format. Could the Deputy identify the relevant slide?

It is on page 9. The heading on the second slide is "VS Schemes to Date". This does not appear to refer to the existing scheme but to previous schemes. The first sentence reads "Applications and level of interest directly related to size of package". The second sentence reads "Intro of Service Bonus almost doubled take-up vs. previous scheme". I draw Mr. Sharman's attention to the next sentence in the document, namely, "Environment Push factors are key to driving applications and conversions". Does Mr. Sharman not accept that this states that environmental push factors were key elements of previous voluntary severance packages?

Mr. Sharman

The document states that these factors are "key to driving applications and conversions".

Yes and this refers to previous voluntary severance packages.

Mr. Sharman

Yes, I think it does.

Therefore, in this document, whether implemented or forming part of the business plan, the company acknowledges openly and clearly that Aer Lingus engaged in shoulder tapping over several years prior to this package. Does Mr. Sharman accept that?

Mr. Sharman

I do not accept that suggestion.

That rejection flies in the face of all reality and the contents of this document, which states that shoulder tapping, or environmental push factors, occurred in previous voluntary severance packages. However, Mr. Sharman asks us to believe that a document prepared——

We agreed to run this meeting on the basis of questions and answers, not statements.

I am asking Mr. Sharman——

The Deputy asked the question and Mr. Sharman answered it.

Would Mr. Sharman agree that in a document which acknowledges that shoulder tapping took place in previous voluntary redundancy schemes and which states that it should take place as part of this scheme, it beggars belief that it did not take place?

Mr. Sharman

That is not what the document states. It indicates that in previous schemes, environmental push factors were key to driving applications. In regard to the phrase "shoulder tapping", I refer to my earlier comment, namely, "provided it is not on a selective basis".

If there are people, such as those to whom the Deputy refers, namely, the superintendents, one third of whose jobs are likely to go, it is necessary to write to one third of them to ensure that they have the information. That was done in the letter to which Mr. McQuillan referred in December 2003.

I refer Mr. Sharman to page 5 of the document and the first slide which is entitled "Managing the Surplus" and which states "The implementation of the plan will create a surplus of 1154 FTE by 2007". This is absolutely specific. It is not a discussion document. It refers to the implementation of the business plan. I put it to Mr. Sharman that far from being a discussion document — and we all know what this document constitutes — this is not an input into the plan but is rather the execution of the plan. All the strategies laid out here involve the execution of the business plan because the two documents were drawn up simultaneously. Does Mr. Sharman deny this proposition?

Mr. Sharman

Yes. It refers to "1154 FTE", which was thrown out. It states "1154 FTE by 2007" but the business plan stated 1,300 by mid-2006 and helpfully added that this should be dealt with in three ways. One was redeployment, namely, where the business plan created surpluses, they should be redeployed within Aer Lingus. There should be a resource centre to do this and also a voluntary service and early retirement exit scheme. That is what the document states.

I referred to it as a discussion document because those figures are wrong. The position is the same with regard to the attached voluntary severance package that the human resources department was designing. The latter included three options but the voluntary severance scheme in the business plan does not encompass any of them.

Very good. The committee would be interested to receive detailed evidence of the information which the union received about shoulder-tapping. If a union member telephones a regional branch secretary, or whoever, with a complaint about this, there must be a record. Will the union go back to its records, formulate all complaints made and send them to the committee?

Mr. Halpenny

I will be happy to do so.

We do not want the names of people contained in such a submission.

Mr. Halpenny

Yes, we understand.

Ms King

Chairman, procedurally I am not sure how to handle one concern I have. In some of Mr. Sharman's answers to questions on the cabin crew issue, I am concerned some information given was incorrect. While Mr. Sharman was not at the presentation, I was. Regarding the uniform issue, Mr. Sharman said that it had not been agreed or seen. However, it was displayed to staff.

In that case, Ms King should document this and ask Mr. Sharman to reply directly to it.

Ms King

I am concerned that members of the committee should know a presentation was made to us.

Ms King has already outlined this.

Ms King

However, regarding the cabin crew——

For the information of members, Ms King can send the committee a copy of the letter that she will send to Mr. Sharman and the committee will receive copies of replies from both parties.

Ms King

A presentation was made by the company to that group of workers.

Ms King can send the committee details of this.

Was it just on the uniforms?

Ms King

It was not just on uniforms. The issue of part-time work was raised. A cut in part-time work was proposed which caused concern.

Ms King might send us copies of the documents given to her at the time by Aer Lingus.

Ms King

Yes.

As seven members have indicated they wish to put questions, I suggest we extend the meeting by 15 minutes. I request those Members, who are not members of the committee, to pose direct questions which will then be answered.

As part of the formulation of the business plan, did Aer Lingus prepare a fleet management and maintenance strategy?

Mr. Sharman

Yes.

Did the minute detail of that strategy form part of the business plan?

Mr. Sharman

No, it did not. However, I am only recently familiar with this area.

As it did not form part of the business plan, is it fair to conclude no maintenance will be carried out on aircraft in the future?

Mr. Sharman

It did not constitute part of the business plan.

Mr. Sharman said the strategy document laid out the human resources element of the company. However, because it did not form part of the business plan, it is null and void and is not part of Aer Lingus management strategy. He also claims a strategy on fleet management and maintenance was devised but that the minute detail did not go into the business plan. If we are to follow this logic, it is fair to assume no maintenance or fleet management will be carried out within the airline in the foreseeable future under the terms of the business plan. That is a ludicrous suggestion.

It is also ludicrous for Mr. Sharman to suggest, on behalf of the board of Aer Lingus, that a human resources strategy, devised as part of the background to the formulation of a business plan, has now been consigned to the shredder. That is not acceptable to us. It is clear that a good deal of concern about the document still exists within the workforce. I ask the delegates for an explanation.

Mr. Sharman

I can respond to that only in the same way I did before. I described this as a discussion document. It is similar to many other discussion documents. To use the Senator's analogy, there were many discussion documents about maintenance. For various reasons, I have been obliged to have a good look at them and they range from recommending doing all the maintenance to doing none of it.

Can Mr. Sharman indicate if consultants were used in the preparation of the business plan? The voluntary redundancy package was oversubscribed by 300. Does Mr. Halpenny think this document was partly responsible for the oversubscription? What is the current position regarding workforce morale? Has the company gone any way towards reassuring members of staff regarding their positions?

Mr. Halpenny

Members will recall that when I came before the committee on 20 October last, I adverted to the fact that people were feeling pressurised and were being told that it was a case of jump or be pushed. I was asked the same question at that time and I stated that there were obviously people who, to use the car insurance analogy, were taking out car insurance but were not intending to crash the car. We now know there was a second pressure on them, namely, that, in our view, there was a clear plan. The company does not agree but we believe that there was a clear plan to deal very quickly, under the chairman's instructions, with the problem the company foresaw.

I refer the committee to page 7 of the document where it is noted, under the heading "Total Demographics", that the average age is 30-plus for all service categories and that this will add to the difficulty of achieving voluntary exits. That is the first point. On the next page it is stated, regarding key exit challenges, that there must be a big take-up, with a need to deliver 1,000 exits. It is also noted that, based on conversion rates to date, 50% of staff will need to apply in order to realise 1,000 exits. This was seen as a serious challenge. The document further notes that the age profile will increase the difficulty in achieving exits.

It is noted on page nine that environment push factors are key to driving applications and conversions. In other words, the age profile was going to be difficult, and based on current conversion rates, 50% of the staff would have to apply in order for the exit figure of 1,000, or whatever, to be achieved. That is the context within which the environment push factors were key. They were the detonator, the key in the engine which was going to drive the plan. That is our view.

Will Mr. Sharman say if consultants were used in drawing up the business plan?

Mr. Sharman

To the best of my knowledge, no external consultants were used in drawing up the business plan. The only exception involved consultations with the company's lawyers.

The principal witnesses on both sides seem to be people of reason, decency and integrity and I hope that some accommodation can be reached between them. However, there is a great deal of semantics involved.

Will Mr. Sharman indicate why, if this is not a business plan, it so describes itself? It is clear that it says it is a business plan. Will Mr. Sharman agree that it is intended to demoralise the workforce, with a view to getting people to take an exit route? What is the meaning of the word "voluntary"? Does it include pressure? It begins to sound very much like the American definitions of torture, which tend to equivocate greatly. Does Mr. Sharman agree that the avoidance of the transfer of undertaking would be illegal, and, therefore, not something to be contemplated by a company such as Aer Lingus?

With regard to the tap on the shoulder, Mr. Sharman described that, rightly perhaps, as use of emotive language but it is used in the document. He indicated that he was concerned about the leaking of the document, the intention of which was to create anxiety. Does Mr. Sharman not agree that the existence of this document alone would create a good deal of anxiety because it suggests something about business practice and, in particular, very poor industrial relations in Aer Lingus?

Mr. Sharman

There are a number of questions to be addressed. One of the key questions was whether this document was intended to demoralise the workforce. No, it was a discussion document between a small group of people. The semantic point was that it calls itself a business plan on the front page. My understanding is that members of the group were being called to a business plan meeting for the HR department. It was a discussion document, not the business plan.

There are documents from many other departments which are headed up in the same manner in Aer Lingus, for example, revenue management and marketing. The latter is marketing business plans. In different drafts they represent all the issues that are being examined and reflected on at a given time. These include long-haul matters, low cost proposals and various items. None of those came about. The various business plan discussions were collected together in a single document called the business plan in which the management indicated the amount of cost it wanted taken out on foot of the business decisions it had taken.

Each department has a piece of paper that says "Implementation of the business plan". Voluntary was intended to be voluntary. Without commenting on the American view of torture, all the papers I was aware of in June and July last year and that came before the board were in terms of approving a voluntary severance scheme.

As there are only a few minutes left, we will now hear from the six individuals who intimated they wanted to ask questions.

I want to address the same question to both Mr. Halpenny and Mr. Sharman. There was a need for 1,300 people to exit the company under the redundancy programme which was implemented and some 1,600 applied for the severance package. Does this mean there are now 300 people working in Aer Lingus who would rather not be there? What does that mean for the future of industrial relations? What are the after-effects of this for Aer Lingus? Are there still people seeking to leave on similar terms?

Could both witnesses give clearer indications on whether there are any outstanding specific cases documented of people complaining of these environmental push factors? Does the company chairman know of any which have been brought to him by the unions and which are still outstanding? I would specifically like him to answer that and I want to ask Mr. Halpenny that as well.

Mr. Sharman in his contribution said Aer Lingus was anxious to exit from unprofitable business. My question concerns an Aer Lingus subsidiary at Shannon Airport which I understand was making up to €10 million in profits annually. When Aer Lingus decided to exit third party handling in Shannon last year, I understand that a number of individuals were left with nothing to do in that company except to report in. They were moved into smaller rooms and some took retirement. Does Mr. Sharman not agree that a majority of these people did not want redundancy and were pushed out of their jobs?

Mr. Sharman has stated he does not, as such, condemn the environmental push factors listed but wishes to put them in context. The document is not marked as a discussion or draft text but actions taken by the company such as the non-provision of transport for staff provide evidence that it has been acted upon. In this context, does Mr. Sharman agree the document, whether it be draft, discussion or otherwise, has some significance in terms of the evidence which indicates it was acted upon as if it were an official document? Its provisions seem to be have been implemented in a shadowy way, in some type of Godfather game plan that was neither addressed nor acknowledged. Will he agree, therefore, that in order to restore proper industrial relations, he must declare a new era of open, appropriate and legal relations between staff and management?

Has Mr. Sharman asked the former chief executive, Mr. Willie Walsh, about this document since the details emerged? If so, what was the latter's response? If not, why has this not been done? Does Mr. Sharman agree the agenda of Aer Lingus management, with his full approval, has been to privatise the airline and that this is the origin of treating workers as commodities who can be cast aside as casually as a tyre on an aeroplane wheel or even a toilet seat?

I have received many complaints from workers in the last year who feel undermined and have been bullied and harassed. The document callously refers to those employees who have been forced out or are leaving as "exits". One of the methods to achieve this end is the infamous tap on the shoulder of all relevant superintendents.

I ask the Deputy to put his question to Mr. Sharman.

It was during Mr. Sharman's watch as chief superintendent of Aer Lingus that this was going on. Has he considered giving himself a tap on the shoulder and asking himself whether he should exit?

Is Mr. Sharman aware that at the meeting of 6 October 2004 I put it to the then chief executive, Mr. Walsh, that my information indicated a gun was being put to the heads of Aer Lingus employees while they were simultaneously being told everything was being done on a voluntary basis? Is he aware that I asked Mr. Walsh about his understanding of the term "voluntary"? The decision on the loss of 1,300 jobs was approved by the Government but the revelations of the last week are a source of serious concern. As a Deputy representing many Aer Lingus employees in north Dublin, I want to see a viable future for the company and growth in the numbers it employs. The question I ask management and the trade unions is whether we can get a commitment today that this document will be put aside for good and that real negotiations will take place on a voluntary and inclusive basis which will ensure the future of Aer Lingus.

Perhaps Mr. Sharman will refer also to the situation at Cork Airport when answering Deputy Ryan's question. Regardless of the status of this document, aspects of its content together with the two incidents mentioned by Ms King indicate a nasty approach within the company to human relations, much of which was excused in the context of the survival struggle that followed the terrorist attacks of 11 September 2001. The new Chairman has taken over very recently. As a result of this document and other happenings, has there been any shake-up in senior personnel dealing with human relations within the company? I do not ask that names be given but for a description of the general ethos and approach to this critically important aspect of the company's future.

Whichever delegate would like to respond first may do so.

Mr. Halpenny

Mr. Sharman has more to answer for.

Mr. Sharman will answer first.

Mr. Sharman

That is because Mr. Halpenny got his answer in first. I will first deal with the last point made. There has not been a shake-up in senior personnel dealing with human relations and the demands of human resources management, as well as many other forms of management, will await the new chief executive of Aer Lingus, who will start a week on Monday.

I have still not received any written complaints nor has anybody formally or informally made those complaints to me. Regarding Senator Ross's question about the number of people who applied to go, 1,652 applied to go while the business plan target was 1,300. Hopefully, I can still say this. The scheme has now closed because we felt that we were fairly close to an the agreement with our trade union colleagues on a number of issues. Representatives from the unions may wish to comment on this later. As a result of some initiatives we took at the end of last year and early this year, the idea was to obtain the same savings from insourcing. Could we do what we do together better? Hopefully, my colleagues will bear out that this was at least the approach. The total number of people who are likely to exit the company under the scheme is probably slightly under 1,000, with no outsourcing in other areas, based on getting agreement with our colleagues as to changing work practices. I think some fairly imaginative approaches have been taken by both sides with regard to improving productivity and multi-skilling.

It is strange for an Englishman to be in this particular place talking about history but this airline is such an important part of the Irish economy and is a symbol. The most valuable things it has, apart from its staff, are its emblem, logo and the frontline staff who serve it and are pretty well-known in their uniforms and the particular colour of their uniforms. I very much want to put this particular piece of history, regardless of whether it was misinterpreted, behind us. Its release was untimely and deliberate but from the company's perspective, I would like to say that it is seeking and has been actively seeking engagement with the our colleagues in the trade unions to do two things. The first is to finish the implementation of the savings in the business plan but with a different approach, which we have called insourcing.

We also want to be able to develop a series of agreements which allow long-haul growth, which will be the future of Aer Lingus because the Irish market will support only so much short-haul travel based on Irish departures. There will be some growth in short-haul travel but there is a large opportunity for Aer Lingus in long-haul travel. The objective of the company and its new chief executive is to realise this potential. I agree that we ought to be able to get on with it, which is what I have been trying to do.

I received a most unwelcome tap on the shoulder in July 2004 and as I have repeatedly said to the Department of Transport, if it wishes to tap me again, I will not fight it. I have also told the Department that if it does not want to tap me on the shoulder again and wants me to continue with the process for a while, I am quite happy to do so.

Privatisation is a matter for the Government. To say that these documents relate to privatisation is absolutely untrue.

Did Mr. Sharman ask Mr. Walsh about the documents?

I think we made it quite clear before that no one individual would be singled out.

He was in a public position as chief executive.

He no longer occupies that position.

He is the one who perhaps could have told Mr. Sharman what was going on.

I will adjourn the meeting. I have made myself clear on this matter.

Mr. Halpenny

We have strong sympathies with the Deputy's view on privatisation but I will not answer that question. I wish to address Senator Ross's question. If I do not, I know there will probably be another glowing tribute to the trade union movement in the next edition of the Sunday Independent.

That will be guaranteed whether Mr. Halpenny answers or not.

Mr. Halpenny without interruption.

The story has just been written.

Mr. Halpenny

I refer to the transcript of the last hearing, at which a similar question was asked. I do not know whether the Senator was present. I said that if one was to reel the situation back to 26 July, which was the date of the announcement of the business plan, and ask if 1,600 people would want to leave Aer Lingus, everyone here would know that the number would be small. A total of 700 have gone willingly or unwillingly. If the Senator is saying that only 300 people do not want to continue working there, I can tell him now that the catering staff want to stay in Aer Lingus, as do aircraft cleaning staff and people in other areas that were earmarked for outsourcing, which we have been able to combat. They are the committed ones. They are not fly-by-nights who are passing through to greater things. They are the people who saved this airline to everyone's credit and benefit. They are the people who put their shoulders to the wheel when it was asked of them and are the ones who least thought that they would be visited with yet another survival or business plan.

I posed a question to Mr. Halpenny.

Mr. Halpenny

I take it the Deputy got an answer.

I received it from Mr. Sharman but I ask it again in the context of where we are going with this matter.

Mr. Halpenny

The Chairman can——

I asked Mr. Halpenny this question.

Mr. Halpenny

Fair enough. My answer is that if there is a future, it cannot be based on this document. It has no part of the future. If the Deputy is asking me in respect of my trade union, privatisation has no part in the future of Aer Lingus as far as we are concerned. The future must be based on the employees, proper mutual trust and respect, proper procedures and adherence to agreements. We must deliver the best possible product to the passengers.

On behalf of the committee, I thank Mr. Sharman, Mr. O'Sullivan, Mr. Halpenny, Ms King and Mr. McQuillan for addressing the committee today and for being frank and open with people on all sides. I have no doubt that, behind the scenes, the unions and management of Aer Lingus will ensure that Aer Lingus continues to thrive. We look forward to dealing with it in the future. I have a request regarding holding a meeting next week on the matter of certain information. I propose that we hold the meeting in early September to deal with the replies from both sides.

My proposal, which was seconded by Deputy Glennon, suggested we would meet again to consider the information that has been promised by both groups.

Deputy Shortall——

May I finish my sentence, please?

I am the Chairman of this committee.

I put forward a formal proposal to the Chairman.

My ruling is that in order to facilitate the request of Deputies Shortall and Glennon, the committee will meet in early September to deal with the replies.

There is another part to the motion. I have also proposed that IMPACT and the director of human resources at Aer Lingus attend.

The committee will meet again in September to deal with the replies from both the unions and Aer Lingus. We will not have a witch-hunt by inviting individuals for the Deputy to address.

No one is suggesting a witch-hunt. On a point of order, I have made a proposal that has been seconded.

I am Chairman and have the right——

I have the right to make a proposal.

It is only fair that I clear up this matter. I facilitated everybody here.

I propose that the committee go into private session if this is an internal discussion. The people here do not need to see what we are doing.

Yes. I thank everyone for attending.

The joint committee went into private session at 1.25 p.m. and adjourned at 1.30 p.m. sine die.

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