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Tuesday, February 28, 2006

Air NZ workers forced to accept "marriage-breaker" deal

Under threat of closure of their workshop the Christchurch Air New Zealand engineers voted to accept a union-management deal that one worker described as a "marriage-breaker" because of the onerous weekend shift work involved.
Dennis O’Brien told the NZ Herald business reporter that the sacrifice he and the other workers were being asked to make was "extreme". Under the "job-saving" scheme promoted by the leaders of the EPMU and AMEA unions, he and others will have to work part or all of 47 weekends a year. At the moment they only work one weekend in three. Mr O’Brien said the new shift-roster will put unreasonable strain on family life. Wages will also be cut by about $15,000 a year.
Mr O’Brien originally voted "no" to the deal but last Thursday he changed his vote to "yes" for a slightly modified offer. "There was a small carrot and a very big stick," he said. He thought it was better to live to fight another day.
Air NZ will now keep the wide-body airframe maintenance work in New Zealand, but 200 jobs will go. The unions had previously brokered a deal that saw 110 engine-maintenance jobs lost. The Prime Minister, Helen Clark, had added to the pressure to accept the deal by urging workers to change their vote. Nevertheless, nearly one third of the Christchurch-based workers still voted "no".
The unions’ acquiescence over the engineering job cuts has been taken as a green light by the company for hundreds of other job cuts. Another 500 office-based job losses were immediately announced after the union acceptance of the 200 engineering job cuts. Andrew Little of the EPMU said it was "unbelievable" that these cuts were to be made. But the lack of resolve by himself and other union leaders over taking action to save the engineering jobs, means the company thinks it can do whatever it likes with impunity.
Little could have led a political and industrial campaign to mobilise support from the public to save the jobs. The Government should have stepped in to take full control of Air NZ, a company that is already 80 per cent publicly-owned. The unions could have fought for that to happen instead of selling members pay and conditions to save some of the jobs threatened.
There have now been 900 job cuts involving cleaners, engineers and office workers. More are to come. The cost-cutting plan put forward by former chief executive Ralph Norris more than two years ago was for 1500 jobs to go. Airline analyst, Peter Sigley, from the financial company Goldman Sachs JBWere, praised the new chief executive, Rob Fyfe, for being an aggressive manager of costs and for not being afraid to make difficult decisions. "Fyfe has stepped into the guts of the business in terms of its cost base," he said. Some might say he is ripping the guts out of the business.
Despite fuel cost rises, Air NZ chairman John Palmer announced that the airline balance sheet was in good shape with more than $1.1 billion cash in the bank and a projected profit expected this year of $140 million. The total savings made through the job cuts are less than $50 million.
As the Alliance says, the loss of jobs is completely unnecessary. It is not about the engineering operation or the airline as a whole losing money. It is all about return on capital. The heavy engineering workshops have been one of the main revenue earners for Air NZ for years.
The Government has the responsibility to stop the wanton economic vandalism by Air NZ management. The job cuts are a major blow to our strategically important transport infrastructure. It is a matter of concern for all New Zealanders and should be top priority for this Labour Government.
No jobs should go and no cuts should be made to workers’ pay and conditions. The Government must step in and take control of the situation.
The Alliance believes the cost-cuts are being made to get the airline ready to be sold back into full private ownership.

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