Unions step up over loss of pay and conditions for Virgin Australia workers

Virgin Australia under Bain Capital is shaping up to be a very different workplace for employees and unions are not happy.

Virgin Australia pilots and cabin crew are facing significant cuts to pay and condition under a new streamlined airline, owned by Bain Capital, unions say. Picture: Lyndon Mechielsen

Pilots face pay cuts of up to 40 per cent and flight attendants will be expected to work 15 hours straight under Virgin Australia’s new owner Bain Capital, unions say.

Concern about the loss of pay and conditions is mounting as new enterprise agreements are worked out in an effort to minimise job losses.

A statement from a range of unions representing Virgin employees said workers were alarmed at the shortfall in aircraft designated and ready for flying.

“Despite a promise of 75 aircraft there are just 56 ready for flying,” the statement said.

“We will be questioning Bain on how it plans to keep 6000 workers employed with less aircraft operating.”

Flight Attendants Association of Australia secretary Teri O’Toole said cabin crew were being asked to accept the same sort of pay as 38-hour-a-week ­office workers.

“They’re being asked to take a significant pay cut to keep flying and there’s been a significant increase in length of duty to as much as 15 hours a day,” Ms O’Toole said.

“We want to work with Bain and Virgin but this shouldn’t be the time to negotiate a complete stripping of conditions and we’re pretty disappointed.”

FAAA industrial officer Steven Reed said experienced international crew would have to take pay cuts of up to $24,000 a year to redeploy to domestic routes.

“It’s like they’re being held hostage. The alternative is you don’t have a job,” Mr Reed said.

“What’s the point of wanting to stay with the airline and work if you’re going to be working under the lowest standards.”

Pilots were also under intense pressure to accept lower pay rates, said Virgin Independent Pilots Association president John Lyons.

“What they’re offering pilots represents a huge reduction in terms and conditions across the board,” Mr Lyons said.

“It’s disappointing but not surprising that they’re using the overall global situation and the difficult situation that airlines everywhere are experiencing to try to reset the industrial bar.”

He said Bain was proposing to change the pay structure for pilots to offer a minimum guaranteed number of hours, or “to pay them by the hours that they fly”.

It was believed this could mean some pilots lost up to 40 per cent of their income.

Transport Workers Union ­national secretary Michael Kaine said some of their concerns would be raised at Wednesday’s first meeting of the advisory council, made up of Bain and Virgin Australia management and union representatives.

“We will be holding Bain Capital to account over the promises it made (to employees),” Mr Kaine said.

“We want a collaborative future at Virgin, based on co-operation rather than private equity suits trying to steamroll decisions and fracture relations which have helped build up the airline.”

A Virgin Australia spokeswoman said some of the changes being sought would shape a future for the airline that was sustainable and would save more jobs.

“We are targeting all areas of our business to reset our cost base and get the certainty we need to be able to plan for our future flying schedule when demand returns,” the spokeswoman said.

Bain Capital paid $3.5bn to acquire Virgin Australia, which went into administration on April 21 with debts of $6.8bn. The sale is not expected to be completed until the end of October, with administrators Deloitte ironing out issues with aircraft and engine leases.

The Full Court of the Federal Court heard an appeal by the administrators on Tuesday against a decision to return four engines to owner Wells Fargo in Florida.

The administrators are concerned the ruling will open the floodgates for other lessors to demand Virgin Australia return their property in line with their original contracts.