BRITISH AIRWAYS (BA): CASE STUDY
Trade Unions are organisations which are formed and used in society to represent workers interests. Trade Unions play a significant role in championing the rights of workers as well as protecting and improving the conditions of work and terms of payment for their members (Blyton and Turnbull, 2004). It is true that an individual worker may not wield enough bargaining power as to impact on and bring about desired changes in his job. Therefore Trade Unions are important in collective bargaining and by campaigning for relevant laws and policies; trade unions are able to foster some benefits to the workers as a collective group. This paper analyses the roles of management and trade unions in the recent British Airways (BA) cabin crew dispute, and discusses the extent to which conflict could have been avoided or at least dealt with more effectively by management.
The roles played by management and trade unions in the cabin crew dispute at British Airways
Trade unions are usually tasked with providing negotiation, representation, informing and advising its members (the workers) and also provision of member services. Negotiation in this case means initiating and facilitating dialogue between two or more parties with view to either reach some form of agreement or resolve some problem (difference). In some circumstances, negotiation aims at deriving some gain or collective advantage in the process of collective bargaining. Therefore trade unions play a significant role in industrial disputes resolution. The usual scenario is that trade unions handle collective bargaining directly with employers because they are functional groups representing the workers. However, in circumstances where an agreement can not be reached between the trade unions and the employers, trade unions may resort to industrial action which may take different forms depending on circumstances and these may include striking among others (Blyton and Turnbull, 2004). Such industrial actions are also subject to certain existing laws that govern operation of unions.
British Airways came into existence in 1970s after the merger of BOAC and BEA. In its early days the company had an organization culture that was considered militaristic and bureaucratic (Kotter and Heskett, 1992). Majority of the organization’s senior pilot served in the armed forces who believed their work was to transport passengers from one point to another and never valued the delivery of quality service to the customers. Facing competition from other national carriers entering the market, the organization implemented a cost cutting measure to try restoring profits. This led to the layoff of over 22, 000 staff in 1980s and further 14,000 staff in1981. However, this cost cutting measure only managed to improve the company’s efficiency and productivity slightly. The organization was forced to undergo privatization in 1987 and the management implemented long term vision involving staff development and enhancement of customer quality. These did not prevent BA from facing more competition from its rivals who came up with low cost carriers and with no government subsidies to salvage it, the organization resorted to laying off of its staff. This move reduced the employees and resulted to persistent industrial disputes. In the early 1990s, there was in every year at least one bargaining group in dispute. During the aftermath of 9/11, the BA suffered a very big blow which forced it to rationalize some haul operations and initiate staff cuts leading to job losses (Blyton and Turnbull, 2004). These incidences sent messages to the trade unions that further job losses were more likely to happen. During the period between 2000 and 2005, the company laid off more than 14,000 employees. Recently, in the process of implementing policies the organization came into logger head with the cabin crew who were opposed to their implementation. Nonetheless, both the management and the trade unions played significant roles during the dispute between the organization and the cabin crew that happened in 2010.
It is important to understand the background and facts regarding the BA cabin crew dispute occurrence. The dispute involved British Airways and Unite. Unite is the UK general union representing more than 2 million workers who are its members. An estimated 12000 BA flight attendants are members of Bassa cabin crew branch of Unite. Following a row at BA over proposals to change working conditions and implement staffing cuts, an estimated 81% of BA cabin crew staff of 79% turnout voted in favour of an industrial action in February 2010 (Prassl, 2011). Earlier on towards the end of 2009, the employees had voted in favour of a 12day strike although this was challenged in Court by BA. The high Court cited a balloting error which violated the 1992 Trade Union Act and therefore granted BA’s injunction request. The 2009 ballot had also been prompted by BA’s decision to cut down on cabin crew so in order to minimize pre-tax losses that had hit a £401m mark in 2008.
Although intensive negotiations followed the February 2010 ballot, there was no substantive progress as far as resolving the dispute was concerned. March 2010 also witnessed seven days of strike action by the BA staff. In response, BA moved fast to withdraw discounted perks for air stewards and went ahead to cushion the operations by way of borrowing cabin crew from other airlines. BA also used volunteer crew and chartered jets to continue their operations during the strike period. Such actions by BA can clearly be seen to have been a way of intimidation to the striking staff. Furthermore, the strike bill as reported by BA was highly suspicious and was as high as £45million despite having operated 79% and 58% of their long-haul and short-haul flights respectively during the strike period.
The backbone of the dispute BA cabin crew dispute was actually the intention by BA management to cut down on operating costs at the time characterized by high competition, declining demand and increasing non-labour costs including fuel expenditure. Following fact that labour costs offer a better chance for attaining efficiency economies in the airline industry, and since the cabin crew usually forms the greater portion of the airline workforce, BA management contemplated recruiting new crew into a separate fleet and under less favourable terms and conditions of work so as to cut down on cabin crew costs by at least £140m a year (Schofield, 2011). BA management also planned to restructure its promotion framework and cabin crew operations with a view to implement a lesser employee remuneration similar to those paid by other BA competitors who were reportedly known to pay their workers much less compared to BA.
Unite (the UK general Union for workers) was opposed to this arrangement or the simple reason that such a move as proposed by BA was bound to generate a division in the workforce since new workers joining the Union would be barred from teaming up with the existing workers in collective bargaining (“Unite theunion”, 2011). The union also expressed concerns that the introduction of the proposed new fleet by BA management would only serve to perpetuate less favourable terms and conditions for workers in future and lead to worker marginalization (Robson, 2011). On the other hand, because of anticipation that BA could resort to legal measures to secure an injunction in the event of a pre-emptive strike against it, Unite was not in position to discuss the fleet proposal. The cabin crew however was unable to attain an early victory because such factors as; inability to broaden the dispute to involve the entire workforce, poor and delayed action plan, and the effect of anti-trade union laws. Furthermore, there was no harmony in trade unions themselves. For instance, the pilots’ union BALPA took a neutral position on the strike issue.
Since the strike came up during run up to UK general election, various political dimensions did surface in this dispute. For instance, David Cameron, (leader of Conservative party), levelled some accusations against Gordon Brown (the Prime Minister) alleging that the PM showed a negative attitude by failing to support the strikers hence that was a weakness on the side of the PM. Apart from that, Cameron accused the PM of being in hock to the trade unions because allegedly, Unite had been reported to have been supportive of the Labour Party and had even made donations for the party to an estimated tune of £11m in the previous 4 years (Upchurch, 2010). Gordon Brown on the other hand argued that the strike was unjustified and was not done in the interest of he workers, the public or BA. Brown’s intervention was politically motivated because of the fears that the government would not be better placed in the fast approaching election if the industrial action was allowed given the rising unemployment situation.
The BA management played a significant role in the dispute. Despite the presence of employee relations strategy which highlights detailed formal approach and cultural change of management, the BA management resorted to a different style of management during the cabin crew dispute (Upchurch, 2010). The employee relations strategy was designed to enhance direct involvement of individual workers on every aspect and level of the business strategy. However, the BA management deployed belligerent management approach which was well against the provisions of the employee relations strategy (Upchurch, 2010). Ordinarily, unions are supposed to negotiate with management regarding any given change, and involve a third party as an arbiter in the event that the two fail to reach agreement. Instead, the BA management’s new style (organization-driven), was designed to shift the employee relations responsibility down to the line managers by a deliberate action to disengage industrial relations specialists from the HR structure.
Some of the measures taken by BA management during the cabin crew strike included suspending of the cabin crew staff who had expressed support for the strike. Generally, the BA management abandoned the normal disciplinary procedure and resorted to immediate suspension. The implications of the BA management strategy are many. First, it is evident that the management strategy was not consistent and kept changing depending on circumstances. The BA management was ready and willing to go to the extent of turning on its own staff as long as the short term needs for cost cutting are met (Upchurch, 2010). While doing this, the management failed to put into consideration the likely impact of such belligerent measures on the workers’ welfare, work morale and the effect these have on customer relations and business competition in the market.
BA’s management style serves to weaken collective worker bargaining other than weakening the employer-employee relations in the workplace. What follows is the culture f mistrust which hampers any meaningful efforts to motivate workers and foster commitment and build necessary attachment to company values mission and goals by the rank-and-file staff (Upchurch, 2010). The cabin crew is a very crucial asset to BA since they form the frontline staff and should be handled with care if the airline has to build a strong corporate brand image and retain its customer base through quality service delivery. When cabin crew staff is dissatisfied and stressed, they fail to display the essential attitudinal strength in customer service (Hochschild, 1983). Resentful and insecure cabin crew staffs are more likely not to report errors and this would be very disastrous for BA management. More so, implementing the strategy for recruiting newer and younger staff at relatively less favourable terms would generate potential for serious safety concerns both for staff and customers alike especially due to loopholes and human errors that may arise from inadequate handling of critical incidents (Upchurch, 2010). In the next section, this essay discusses the extent to which the conflict could be avoided or at least dealt with more effectively by management.
The extent to which the conflict could have been avoided or at least dealt with more effectively by management
The BA management could have avoided the conflict or managed it more effectively by choosing to use less belligerent response approaches. For instance the management could have resorted to the application of alternative dispute resolution (ADR) mechanisms which comprises of arbitration and mediation methods. In arbitration, disputes between parties are submitted to an independent third party that is neutral (i.e. an arbitrator). In labour relations, disputes are resolved using the labour arbitration process. On the other hand, mediation/reconciliation involves an active third party who plays the facilitating role towards dispute resolution by suggesting possible solutions to the problem. A decision made by the arbitrator concerning a particular labour dispute is deemed binding and final in the collective bargaining process (Collins and Porras, 1994). The BA management and the trade unions could have used these approaches to develop a collective bargaining agreement that would outline the management’s responsibilities, the workers rights, and define the ultimate mutual relationship (Hochschild, 1983). Arbitration is a relatively cheaper dispute resolution approach and is preferred over litigation and strikes for dispute resolution.
Other ADR approaches include use of Ombudsman and Neutral Evaluation. The ombudsman is usually a high ranking officer in the organization with an impeccable reputation such that he is able to comfortably facilitate ways of reaching dispute resolution between the employees and the company. With the use of ombudsman, the conflicts are confined and managed confidentially within the organization’s family. On the other hand Neutral Evaluation involves a neutral person having ADR background whose role is to listen to versions of the problem as presented by each party. The Neutral evaluator can then give his informed opinion concerning the dispute. All these are alternative ways that the BA management could have used to better manage the cabin crew dispute or even help avoid it altogether.
The BA management needed to have recognized the plurality of interest that characterized the organization while at the same time coming up with an organization culture and business behaviour that supports sustainability by high quality service, motivation and employee commitment. According Flanders (1967), the existence of high trust environment perpetuates the recognition of individual employee’s dignity and their right in expressing their interests through elected representatives. However, this necessitates commitment from both management and unions to significant negotiations and collective agreement.
The BA management should not have used bullying on cabin crews as this method is disastrous if imposed on demoralised and resentful staff. The BA organization has a culture of intimidation and authoritarianism which is not good for smoothing running of organization’s operations as it breeds contempt in employees which was a catalyst for instability in the organization (Blyton and Turnbull, 2004). Cabin crew represent the customer-facing staff and therefore play important role in the BA’s operations in terms of satisfaction of customers and corporate brand experience. BA management should not have waged war on the cabin crew for this impacted greatly on the business and continuous conflict with employees is not a way of running a business for it instead leads to losses and closure.
In a nutshell, the row between BA and the cabin crew could have been averted if the management had taken appropriate approach. The cabin crew is a very crucial asset to BA since they form the frontline staff and should be handled with care if the airline has to build a strong corporate brand image and retain its customer base through quality service delivery (Upchurch, 2010). Because of the role the cabin crew play in the organization, it is important for the management to implement an organization culture that is not intimidating and authoritative. In settling dispute, the BA should have resorted to using alternative dispute resolution (ADR). Thus, the BA management and the trade unions needed to have used these approaches to develop a collective bargaining agreement that would outline the management’s responsibilities, the workers’ rights, and define the ultimate mutual relationship.
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