Bloomberg News

Iberia Workers to Strike Week Before Christmas Over Job Cuts

November 29, 2012

Spanish airline Iberia faces a week of strikes in the run-up to Christmas as unions protest job cuts ordered by parent International Consolidated Airlines Group SA. (IAG)

All staff except pilots are called to strike Dec. 14 and Dec. 17 to Dec. 21, UGT and Comisiones Obreras union officials told reporters in Madrid today. Worker representatives are discussing the protest with the government and hope to sit down with Iberia before the start of the planned walkout, they said.

“We will not take part in the orderly dismantling of the company,” said Francisco Rodriguez, head of air transport issues at UGT.

IAG plans to shrink Iberia’s fleet and scrap 4,500 jobs, more than one-fifth of the total, as Europe’s third-biggest airline seeks to stem losses that have wiped out earnings from its British Airways brand. Iberia is struggling to compete with low-cost airlines amid a five-year economic slump and 26 percent unemployment rate.

Spanish unions are stepping up pressure on companies and the government and this month staged a second general strike in less than a year. The campaigners reject changes to labor rules that make it easier and cheaper to fire workers at struggling companies, combined with the deepest spending cuts on record.

Iberia had no immediate comment on the strike.

Walsh Cuts

IAG traded 0.2 percent lower at 169.80 pence as of 11:27 a.m. in London. The stock has added 15 percent this year as Chief Executive Officer Willie Walsh follows Air France-KLM Group (AF) and Deutsche Lufthansa AG (LHA) in cutting jobs.

Walsh, who has led IAG since its formation from an Anglo- Spanish merger in 2011, is seeking a 600 million-euro ($779 million) turnaround in earnings by 2015 at Iberia, which lost 262 million euros in the first nine months. He’s pushing through lower pay for new recruits two years after riding out a strike by cabin-crew at British Airways.

IAG has also made a bid for shares it doesn’t yet own of Spanish discount carrier Vueling Airlines SA (VLG), following the creation of its own lower-cost unit, Iberia Express.

Iberia pilots, represented by the Sepla union, aren’t supporting the December strike since they’re bound by terms of an arbitration ruling on a dispute over Iberia Express.

To contact the reporter on this story: Sharon Smyth in Madrid at ssmyth2@bloomberg.net

To contact the editor responsible for this story: Chad Thomas at cthomas16@bloomberg.net


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