Ryanair tells workers up to 900 jobs could be at risk

Ryanair (RYA.L) CEO Michael O’Leary has warned employees that as many as 900 jobs could be at risk at the airline.

In a leaked video obtained by Bloomberg, O’Leary told workers that it has more than 500 too many pilots and around 400 too many flight attendants.

In addition, O’Leary suggested that by next summer Ryanair will need 600 fewer people in those categories than it had previously planned.

While a Ryanair spokesperson confirmed the authenticity of the video to Yahoo Finance UK and said that it expects 900 current staff to be impacted, it said reports that up to 1,500 jobs could be “at risk” were false.

Ryanair, which is one of Europe’s largest airlines, currently has around 5,500 pilots and around 9,000 flight attendants, which means that up to 6% of these employees could be affected.

“We over the next couple of weeks will be doing our very best to minimise job losses, but some are unavoidable at this time,” O’Leary said in the video.

Job losses could come as soon as winter 2019, he said.

The company said earlier in July that it would have to shrink or close poorly performing bases, blaming the Boeing 737 MAX crisis — which has delayed planned fleet upgrades — and Brexit.

Its capacity growth for summer 2020 will also be more than half what it had previously expected.

In the video, O’Leary also blamed a drop-off in employee churn, which he said had “dried up to effectively zero”, and suggested that improved pay conditions as a result of a unionisation drive at the airline had resulted in fewer staff leaving the company.

The job cuts come after a difficult 2018, which saw Ryanair experience a series of damaging strikes, and after the company this week reported a 21% fall in quarterly profits.

But compared to its competitors, the airline is still in pole position, mainly because its cost base is very low.

Meanwhile, Ryanair pilots in the UK and Ireland are currently being balloted on strike action in relation to a dispute about pay, while cabin crew in Portugal will strike for five days in August.

The National Union of Civil Aviation Flight Personnel (SNPVAC) in Portugal insists that the airline has not complied with an agreement signed in November, which guarantees holiday pay, 22 days of annual leave, and commits the airline to respecting the country’s parental law.

Ryanair said in its annual report on Tuesday that O’Leary would take a 50% pay cut to €500,000 (£458,000), and reduce his bonus to a maximum of the same amount.

Including both his salary and bonus payments, the airline boss had earned €3.7m (£3.4m) in the 12 months to 31 March.

O’Leary started a new five-year contract as CEO on 1 April, meaning that he is set to lead the airline group, which now includes several other airlines.

After-tax profits in the three months to the end of June at Ryanair fell by 21%, to €243m, compared to the same period last year.