Dáil Éireann díospóireacht -
Thursday, 23 Jun 1994

Vol. 444 No. 3

Adjournment Debate. - TEAM Aer Lingus Dispute.

Proinsias De Rossa

I thank the Ceann Comhairle for giving me the opportunity to raise this important matter in the House. The decision by the management of TEAM yesterday to proceed with the layoff of more than 800 workers was the most ominous development yet in what is one of the most serious crises in the public sector for many years. If this crisis is not resolved not only will some 2,000 workers be dumped on the dole it will also spell the end for one of the few new industrial ventures in the public sector for decades, threaten the existence of Aer Lingus and cut a swathe of economic destruction through much of north Dublin.

Given the seriousness of the situation, it is hard to understand the bloody minded take it or leave it attitude of the Minister for Transport, Energy and Communications and his Cabinet colleagues. When Galway faced the Digital crisis in 1992 no effort was spared to save jobs; there were high level meetings, special Dáil debates and ministerial dashes across the Atlantic. The workers in TEAM Aer Lingus got none of those considerations — just an ultimatum and a ministerial washing of hands. Is it any wonder that more and more TEAM workers are beginning to wonder whether there is a hidden agenda involving killing off TEAM and the promotion, perhaps, of some privately-owned firms carrying out similar work? Is it a Thatcherite agenda setting out to break the workers' trade unions? Why are Labour Party Ministers standing idly by? The workers are not responsible for the economic problems threatening to strangle TEAM Aer Lingus. The workers did not undertake the initial viability assessment of the project; they did not get their sums wrong or badly misjudge the market and the competition the company was likely to face. Therefore, the workers alone should not now be asked to carry the economic can for the TEAM crisis.

It is understandable that TEAM workers want to defend their jobs and economic position to the maximum extent possible. Many of them gave up secure jobs to work in TEAM, others moved to new houses to be near the job, taking on new mortgages and commitments. They, more than anyone, have a vested interest in securing the future of the company.

With the support of the Government it should be possible to find a solution to the current problem which would secure the maximum number of jobs without impoverishing the workers and guarantee the future viability of the company. We will face an industrial disaster unless something is done to break the deadlock. There must be negotiations some time and it is preferable to enter into them now, when there is something to save, rather than when the only task facing negotiators will be to pick up the pieces.

Clearly there is a difference of opinion on the Government benches. The Minister said that the only matter to be discussed is the implementation of the report of the Labour Relations Commission. Labour Party backbenchers suggested that the report of the Labour Relations Commission and the trade union development plan should be on the agenda. That seems to offer a possible formula for progress and it is astonishing that the Minister should reject it. The Labour Relations Commission document is in the form of a report prepared for the Minister for Enterprise and Employment under section 38 (2) of the Industrial Relations Act, 1990. Therefore, there is no reason the Labour Relations Commission or the Labour Court should not be requested to continue investigations at a number of levels, if necessary, to appoint consultants and even an independent chairperson to review all elements of this dispute.

I do not question the bona fides of those who drafted the Labour Relations Commission document, which was prepared under great pressure and dealt primarily with the industrial relations aspects of the problem rather than with broader viability issue. It largely took on board the proposals of management which were deeply flawed in the first place and appeared to take little account of the trade union development plan.

This is not a routine industrial dispute, the problems arise from the economic condition of the company. It is possible that cost savings as great or even greater than those proposed in the Labour Relations Commission document could be effected with the co-operation of the workforce through a well-based viability plan, but it must be done through co-operation between management and workers living up to the name of the company and acting as a team. Neither management nor unions can impose their will on the other side, since victory for one may well spell ultimate defeat and disaster for both. The Government, as a shareholder and the custodian of the public interest in the company, cannot stand on the sidelines and act like some disinterested observer; the Minister and his colleague, the Minister for Enterprise and Employment, should be in there encouraging, facilitating, prompting and doing everything possible to bring the two sides together. Saving the company and its jobs rather than the niceties of industrial relations protocol should be the priority.

Finally, it should be said that other seemingly impossible disputes in the public sector in the past, in the ESB and Bord na Móna — about which the Minister knows — and indeed in others have been solved. Let the Minister now get off his high horse, look at the files, take a leaf out of the books of some of his predecessors and ensure that this dispute is solved now before further damage is done to TEAM and perhaps to Aer Lingus itself.

Minister for Transport, Energy and Communications (Mr. Cowen)

As I said previously, my motivation and that of the Government is not for the purpose of being bloody-minded, or of being on a high horse, although I am sure Deputy De Rossa's phrase is very catchy in media terms. The seriousness of this situation is such that the finely measured arbitration that emanated from the Labour Relations Commission constitutes the only way forward for the short term survival of the company. My motivation — and that of the Government — is to maintain employment in TEAM Aer Lingus; the Government's motivation is not to precipitate a crisis but to avert it. The way forward and the framework for averting a crisis is available to us within the settlement terms put forward by the Labour Relations Commission. Deputy De Rossa will be aware that there have been months of conciliation talks and discussions, on a bilateral basis, between management and unions. I reiteriate that, as late as last week when the Labour Relations Commission put forward its report, they confirmed that there still was not a common agenda. It has been the dialogue of the deaf and the arbitration put forward by the Labour Relations Commission, given the seriousness, gravity and urgency of the situation, constitutes the only way forward.

I want to make it very clear that, if we could get agreement to the Labour Relations Commission's terms of settlement, we would immediately arrange to move to the other issues, that is deal with the medium and long term strategies. Indeed the Labour Relations Commission acknowledge, in clause 24, the potential of plans put forward, notably by the trade unions group, that as priority, the forum would examine those proposals — apart from examining any other proposals for medium to long term strategies — for the enhanced viability of the company in the future; that is the level of priority being given under clause 24. Everybody involved in the dispute and everybody aware of the crisis, should look to clause 24 as a means by which the issues which the unions seek to address can be addressed when we have acceptance of the settlement terms.

Let me reiterate the facts and how they can be confronted to the mutual benefit of all parties to this dispute. The first is that TEAM Aer Lingus is grossly uncompetitive, which is accepted by all parties to the dispute. The company's unit costs are too high in relation to its competitors and that is why it has run out of work and money. Unit costs are a function of wage costs and output and must be tackled if TEAM is to survive, let alone prosper. Everybody involved who has commented on the TEAM crisis accepts this.

As I already stated in this House, it is my wish and that of the Government that not alone should TEAM survive, it should also prosper. To do so it must tackle costs and boost output by increasing its market share through new business. The core of the present impasse is in what order these should be tackled. Here again, we must be guided by the facts.

The second fact is that TEAM has run out of cash, its bills and wages being paid by the airline. That is not surprising in view of the fact that the company has been losing over £1 million per month, which will escalate over coming months as the market for airline maintenance suffers its usual seasonal decline. The inescapable logic of this is that wage costs must be tackled now, if the company is to survive.

Another factor which must be addressed is the seasonality of the business since TEAM Aer Lingus is a highly seasonal business. Its competitors have not alone recognised that fact but geared their production and working schedules accordingly. TEAM must do so also if it is to survive.

There are many ideas on how to develop the company; no one person or group has a monopoly on good ideas. I want all ideas examined. In particular, I want the ideas of the workers in TEAM Aer Lingus thoroughly examined and professionally assessed. As a former Minister for Labour I have consistently advocated and facilitated the maximum feasible input of workers to the development of their company. After all, they are major shareholders in ensuring that their company remains commercially viable. This is, and always will be, my general approach. It is also my approach in relation to TEAM Aer Lingus. Judging my the contributions of Members across all parties I know that firm commitment to the equity-injection approach I outlined is one on which there has been consensus. I have been asked to devise mechanisms for achieving this new consensus. There is no need for new mechanisms; as I said, we have one in clause 24 of the settlement terms. That clause is no smokescreen but the basis on which this dispute can and must be resolved.

I want to give this House and the workers of TEAM Aer Lingus today a firm commitment that immediately — and I emphasis immediately — the survival of their company is assured by the acceptance of the terms of settlement of the Labour Relations Commission, their formal proposals will not only be professionally assessed but implemented if they can be shown to contribute to the company's development.

However, as the House will be aware, we must satisfy the European Commission that all equity injections into the Aer Lingus group will not alone yield the cost savings specified but will also ensure the future viability of the group. This condition must be met for all constituent companies of the group, including TEAM.

In conclusion, I reiterate once more that none of us wants this dispute to continue. It need not continue. All parties subscribe to the fact that the financial crisis in TEAM cannot continue. I would urge them to also subscribe to the solution which is on the table and move forward from here to re-develop this company to its full potential.