British Airways is set to announce the launch of its new short-haul airline at Gatwick within weeks after reaching a key agreement over pay and conditions for cabin crew with trade union bosses.
The Mail on Sunday can reveal that BA finalised negotiations late last week with the Unite union, which represents more than 10,000 of the airline’s cabin crew as well as engineers and ground staff.
Striking a deal with Unite, which has been one of BA’s fiercest critics during the pandemic, was the last major hurdle to launching the new airline. It means BA can start hiring staff ahead of the first flights from next April.
In an internal update to staff on Friday afternoon, BA chief executive Sean Doyle said: ‘Our plans for a new BA-branded subsidiary to fly short-haul at Gatwick are progressing well, having received support this week from Unite.
‘While we still have some further negotiations to sort, it looks likely that we will be up and running to fly the summer schedule.’ The final talks are with ground handling staff and Gatwick, which Doyle expects to conclude ‘imminently’.
BA first announced its plans for the BA-branded Gatwick airline in August but said it would only be possible if it had a ‘competitive cost-base’.
Staff employed by the new business – dubbed ‘BA-Lite’ – will be asked to sign more flexible contracts, expected to include part-time or seasonal working.
It is thought that around 160 pilots and several hundred cabin crew could be hired for the new airline, which will operate up to 17 planes for short-haul European trips.
BA reached agreement with pilots’ union Balpa last month following weeks of tense negotiations. Balpa had previously walked away from the talks, putting the future of the airline in jeopardy.
It is understood Unite’s negotiations with BA focused on pay and flying schedules to make sure cabin crew employed at Gatwick earn the same as staff in other parts of BA’s business.
Cabin crew earn a basic salary plus variable pay, based on the number of hours flown and commission on in-flight sales.
Unite’s aviation officer Oliver Richardson said the variable pay can add up to ‘tens of thousands of pounds’, adding: ‘We wouldn’t want a position at Gatwick where people are being asked to come back to a short-haul operation on radically inferior terms and conditions.’
Relations between Unite and BA are still frosty after the airline cut around 10,000 jobs last year.
Unite called the strategy ‘opportunistic’ and criticised BA’s plans to bring back some former cabin crew now that travel is picking up, claiming they are being rehired on ‘substantially reduced terms and conditions’.
But union bosses accept that BA’s new short-haul airline will create jobs at Gatwick and in sectors that rely on the airport such as hotels, catering and transport.
Gatwick is one of the hardest-hit aviation companies after a string of major airlines based at the airport – including BA, Virgin Atlantic and Norwegian – scrapped or scaled back flights during the pandemic.
BA’s parent company, IAG, said on Friday that it would make a €3billion (£2.57billion) loss this year, after a €452million (£387million) loss for the three months to September. It followed a £1billion fundraise for BA last Monday.
With the aviation industry still struggling despite the gradual lifting of international travel restrictions since May, Tory MP Henry Smith, whose Crawley constituency includes Gatwick, last night welcomed BA’s move.
He said: ‘This is further evidence of the aviation sector and the local economy beginning its recovery from the damage caused by the pandemic.’