Saturday, July 05, 2008

Pay cuts at AirTran Airways, furloughs may follow

AirTran AirwaysEmployees at AirTran Airways are the latest to fall prey to the current airline capacity reduction and cost cutting trend. The Orlando-based airline announced this week that its 8,900 AirTran employees can expect pay reductions ranging from 5 per cent to 15 per cent, beginning in August.

Kevin Healy, senior vice president of marketing and planning at AirTran, said that most of the carrier's employees will get a 5 to 8 percent pay cut, while pay reductions for senior crew and directors will range between 11 to 13 percent. Top executives, including AirTran CEO Bob Fornaro, will take a 15 per cent cut in pay.

In a memo to AirTran employees, Mr. Fornaro said, "Our plan is to temporarily reduce pay rates for six months commencing with the start of the August pay period, and we will then review the situation again."

Nearly half of AirTran's employees are unionized. Technically, the unions representing AirTran's pilots, flight attendants, mechanics and other work groups must still agree to the salary reductions before they are implemented.

So far, no furloughs have been announced for AirTran crews, but in light of the carrier's stated plans to reduce its fleet by as much as 8 percent, furloughs may follow.