Heathrow 'to slash staff pay by up to a third' after collapse in air travel

Heathrow staff are being asked to swallow pay cuts of up to 37pc and will lose their final salary pension scheme as the airport grapples with a plunge in global travel, unions have claimed.

The company is seeking to slash pay and conditions for its 7,000 workers in a bid to become a low-cost employer, according to union chiefs – an allegation denied by management.

A row has broken out between the two sides amid negotiations over changes to staff contracts. Heathrow says these are vital to avoid job cuts, as the airport nurses coronavirus losses of £1bn and rising.

Heathrow - whose owners include Spanish company Ferrovial, the Qatar wealth fund, and China Investment Corp - earlier this week reported an 88pc collapse in passengers in July compared to last year. Around 60pc of its routes are still grounded as the air travel industry reels from the impact of Covid-19.

But in a letter to members, union Unite accused the business of acting out of “greed, not need” and said it was using the pandemic as a smokescreen to cut pay and conditions. It added that Heathrow paid £100m in dividends in April.

Heathrow boss John Holland-Kaye told unions that he wanted to make the business a “low-cost employer” during a meeting on July 30, it is claimed.

Unite accused the firm of planning to cut pay by up to 37pc, close its lucrative final-salary pension scheme, axe paid breaks and allowances, worsen redundancy terms, and refuse to honour a pay rise.

Wayne King, Unite regional co-ordinating officer, said: "Heathrow is cynically using Covid-19 to bounce workers into accepting drastic attacks on their pay in order to boost  profits." 

Heathrow hit back at the allegations, saying they are completely false and have been taken out of context.

A spokesman added: “The airport’s intent was never to become a low cost employer, and throughout four months of talks, our priority has always been to protect jobs.”

Heathrow said that earlier pay deals were agreed in a far better business environment, and that it has been forced to take action now to protect jobs.

The spokesman added that pay cuts will generally be smaller than claimed by unions, with most wage reductions coming in at between 15pc and 20pc.

He said: “Our final proposal will provide a job for all of our colleagues and ensure the long-term future of the airport. We urge our union partners to accept the revised offer.”

Last month, Mr Holland-Kaye warned that new Government restrictions such as the ending of air bridges and requiring travellers to self-isolate for two weeks could lead to as many as 25,000 job losses for people working at the airport.