British Airways is expected to announce it will suspend around 36,000 staff as it battles to survive the coronavirus crisis.
It comes after ten days of intense talks with union bosses and will mean 80 per cent of cabin crew, ground staff, engineers and those working at head office will have their jobs suspended.
Crucially however, no staff are expected to be made redundant following the deal.
It comes after the airline axed all its flights to and from Gatwick Airport as COVID-19 continues to strangle the aviation industry.
The airline, which jets to Europe, America and the Caribbean from the West Sussex airport, has already mothballed many planes across its UK bases – but is still running from London Heathrow with a severely reduced schedule.
The decision by BA to shut its Gatwick operation came hours after easyJet grounded its entire fleet of 330 aircraft and became the first UK airline to stop all its operations.
Large numbers of the British Airways fleet of aircraft are seen grounded at Bournemouth International Airport including several Boeing 747 planes on Wednesday
From Wednesday, Gatwick’s North Terminal shut with the South Terminal operating from 2pm and 10pm to cut costs, meaning most of the airport’s staff will be furloughed. They will be paid 80 per cent of their average pay up to £2,500-a-month through the Government job retention scheme.
A British Airways spokesman declined to say how many of its workers’ jobs are under threat when asked earlier this week, but said: ‘Due to the considerable restrictions and challenging market environment, like many other airlines we will temporarily suspend our flying schedule at Gatwick. We are contacting affected customers to discuss their options.’
Two weeks ago British Airways admitted coronavirus is threatening its very survival as staff were told there will be job cuts and aircrafts must be mothballed because of the ‘worsening’ worldwide pandemic.
Chief Executive Alex Cruz wrote to all 45,000 workers saying the virus’ relentless spread is a crisis ‘of global proportions like no other we have known’, more serious than the 2008 financial crash, SARS or 9/11.
But chief executive of its parent company IAG, Willie Walsh, has also stressed that he had not requested a government bail-out and insisted IAG was ‘resilient with a strong balance sheet’, adding there is ‘no guarantee that many European airlines would survive’.
British Airways today axed all its flights to and from Gatwick (its grounded jets pictured there today) as the aviation industry continued to collapse because of coronavirus
BA is one of many that are to stop serving the UK’s second busiest airport due to the collapse in demand caused by the coronavirus pandemic.
The airline will keep equipment for essential functions at the airport, such as maintenance, towing and cleaning, to enable it to restart operations quickly.
Just 33 flights were due to take off or land at the West Sussex airport on Tuesday, according to aviation data provider FlightStats.
From Wednesday, Gatwick’s runway will only be open for scheduled flights between 2pm and 10pm.
The airport will also close one of its two terminals.
How coronavirus has affected airlines in the UK over the past month
Flybe: Europe’s largest regional airline collapsed on March 5 after months on the brink, triggering 2,400 job losses and left around 15,000 passengers stranded across the UK and Europe. Flybe’s owners, a consortium including Virgin Atlantic, the Stobart Group and hedge fund firm Cyrus Capital, blamed coronavirus for hastening the ailing airline’s collapse. Flybe operated up to 50 UK routes, accounting for 40 per cent of all domestic flights, and was used by 9.5million passengers a year.
British Airways: The International Airlines Group, which also includes Iberia and Aer Lingus, said on March 16 that there would be a 75 per cent reduction in passenger capacity for two months, with boss Willie Walsh admitting there was ‘no guarantee that many European airlines would survive’.
easyJet: The airline with 9,000 UK-based staff including 4,000 cabin crew grounds its entire fleet of 344 planes on March 30. The Luton-based carrier said parking all of its planes ‘removes significant cost’ as the aviation industry struggles to cope with a collapse in demand.
Loganair: The Scottish regional airline said on March 30 that it expects to ask the Government for a bailout to cope with the impact of the pandemic. Loganair will go to the government despite being told by Finance Minister Rishi Sunak last week that airlines should exhaust all other options for funding, before asking for help.
Jet2: The budget holiday airline has suspended all of its flights departing from Britain until April 30. A number of Jet2 flights turned around mid-air earlier this month while travelling to Spain when a lockdown was announced in the country.
Virgin Atlantic: The airline said on March 16 that it would have reduced its lights by 80 per cent by March 26, and this will go up to 85 per cent by April. It has also urged the Government to offer carriers emergency credit facilities worth up to £7.5billion.
Ryanair: More than 90 per cent of the Irish-based airline’s planes are now grounded, with the rest of the aircraft providing repatriation and rescue flights.
The measures will be in place for a minimum of one month.
Airports are responding to the decision by airlines to suspend the majority of their flights due to demand plummeting and countries around the world introducing travel restrictions in a bid to slow the spread of coronavirus.
London City Airport closed its runway to all commercial and private flights last week while Southend Airport is only open on Tuesdays, Thursdays and Sundays between 4.30pm and 9.30pm.
IAG recently announced three-quarters of flights will be cut over the next two months also said it was ‘taking actions to reduce operating expenses and improve cash flow’.
These include temporarily suspending employment contracts, reducing working hours and offering staff unpaid leave.
The group, which also owns Iberia and Vueling, employs 66,000 staff.
Airlines are in the process of temporarily laying off tens of thousands of staff without pay.
Amid warnings of an industry collapse within weeks, BA-owner IAG, EasyJet, Ryanair and Norwegian all revealed drastic plans to slash costs and ground flights.
Virgin Atlantic said staff had agreed to take eight weeks of unpaid leave over the next three months, with the salary docked from workers’ pay over six months so their income does not dry up.
All 10,000 employees of the company, founded and controlled by Richard Branson, will also be offered voluntary redundancy.
In a sign of the scale of the coronavirus crisis, the airlines have been backed by the union Unite and pilots association Balpa.
The most extreme measures were taken by Norwegian, which is the third largest airline at Gatwick. It is temporarily laying off around 7,300 staff – 90 per cent of its workforce.
The airline which is saddled with debt, has lost more than 80 per cent of its market value since the start of the year.
EasyJet’s founder Sir Stelios Haji-Ioannou yesterday justified the decision to pay a £174million dividend to shareholders including around £60million to his family just ten days before it grounded all its 330 planes.
The billionaire founder of easyJet Sir Stelios Haji-Ioannou (pictured in Monaco where he lives) was awarded a £60million dividend from the ailing business ten says ago. It grounded all its planes today and furloughed staff
Why are flights still landing in Britain from coronavirus hotspots including Italy, the US and Spain?
Flights are still landing in Britain from coronavirus hotspots including Italy, the US and Spain.
Passengers landed at London Heathrow this morning on planes from the likes of Rome on Alitalia, New York on United Airlines and Madrid on Iberia.
Flights from America also brought passengers into London today from other US cities including Atlanta and Boston on British Airways, and Dallas on American Airlines.
While passengers arriving on flights from affected countries are asked to self-isolate for 14 days, there are no means of enforcing this and no health checks are being carried out at UK airports.
There is a split in the Cabinet other whether UK borders should be closed to stop people arriving from virus hotspots.
Home Secretary Priti Patel wants to stop passengers being able to fly in to the UK from countries with high levels of infections such as Iran, the US and China.
Mrs Patel believes flights from virus hotspots should not be allowed when the country is on lockdown to prevent its spread.
The lack of a travel ban in the UK is in stark contrast to policies in the EU and the US which have closed their borders to travellers from many other countries.
Prime Minister Boris Johnson and Foreign Secretary Dominic Raab want to keep the borders open, in part to allow stranded Britons to return home.
The Luton-based airline employs 9,000 staff and is the first in the UK to stop all flights and mothball all jets since the coronavirus pandemic took hold in Britain.
Sir Stelios said the now-controversial dividends were agreed in February when ‘the world looked like a much happier place’ and the cash was ‘automatically’ paid to shareholders on March 20 and were ‘impossible to stop’.
The grounding of easyJet’s gigantic fleet came just days after calling for a state loan to help them survive.
Justifying the £170million payout Sir Stelios, who with his siblings are the largest single shareholders in the carrier with a 34 per cent stake, insisted that the dividends were ‘legal’ and ‘rightful’.
He said: ‘The reality of the situation is the dividend was legally at the point of no return on the 6th of February, or at the very latest on the 27th of February 2020. The world looked like a much happier place on the 6th of February and the dividend was rightfully paid to all shareholders’.
In a lengthy statement he said the payments could not have been stopped.
He said: ‘The dividends by the 20th of March we already paid automatically via a complex web of bank accounts where the shares are held and it is impossible to stop it for some shareholders but not for others’.
Sir Stelios is threatening to seek the removal of board members unless the airline withdraws from a contract with Airbus to provide 107 aircraft which he said will cost £4.5 billion.
In his statement today he said journalists who asked whether he would hand his dividend back were ‘naïve/malicious’, adding: ‘I am perplexed as to how that would work?’, adding: ‘To be used how? To pay that money straight over to Airbus? And what is the consideration for such a gift? Or is it meant as a selfless charitable donation? Charity towards which deserving cause exactly? easyJet is not a registered charity to receive donations and neither is Airbus. That’s not how publically listed companies work’.
EasyJet planes are seen grounded at Edinburgh Airport this morning as all its 1,000-plus routes closed for at least two months
EasyJet grounded its entire fleet of 330-plus planes as coronavirus continued to wound Britain’s airlines.
Stelios battles Easyjet over £4.5bn planes
Easyjet’s founder has gone to war with the struggling airline over its plans to spend £4.5bn on aircraft.
Sir Stelios Haji-Ioannou, 53, claimed the company should not be seeking a government bailout and is urging it to scrap its order for planes with Airbus instead.
In an ultimatum to Easyjet’s board, he threatened to launch a campaign to unseat one director every seven weeks unless bosses gave in to his demands.
Easyjet grounded its entire fleet yesterday because of the coronavirus crisis, effectively leaving it without any source of revenue. The airline and its rivals have held talks with the Government about possible taxpayer-funded loans to help them stave off collapse.
The airline serves 159 airports and 1,051 routes, has 9,000 UK-based staff including 4,000 cabin crew.
The company has worked with union Unite to agree two-month furlough arrangements for cabin crew which means that crew will be paid 80 per cent of their average pay up to £2,500-a-month through the Government job retention scheme.
Virgin Atlantic will ask the British government for a package of commercial loans and guarantees worth hundreds of millions of pounds, the Financial Times reported.
Other carriers including airlines such as Loganair and Eastern Airways, and Norwegian Air Shuttle are also considering to ask for state aid, the newspaper added.
But British ministers want bigger airlines with wealthy shareholders will weather the storm without the need for billions in taxpayer cash.
The Luton-based carrier said the measure ‘removes significant cost’ as the aviation industry struggles to cope with a collapse in demand caused by the outbreak of the virus.