SAS Set to Cut Work Force by 40%

Scandinavian carrier SAS has announced plans to restructure, and according to news reports, that will have a massive impact on jobs at the airline. SAS CEO Mats Jansson told reporters that the airline will cut 40 percent of its routes, sell foreign units, and eliminate about 9,000 employees.

SAS plans to cut about 3,000 jobs outright. In addition, another 5,600 employees will leave the airline as part of operations that are to be sold or outsourced. In all, about 40% of the current 23,000 jobs at SAS will be eliminated from the airline's payroll.

According to the BBC, SAS "hopes to sell its interests in Spirit, Air Greenland, BMI, Estonian Airways, Skyways, Cubic and Trust, as it concentrates on business travel in the Nordic market." Divestment of its Spanish subsidiary, Spanair, is already underway.

In a press release, the SAS CEO said the restructuring was necessary "to address one of the most severe economic declines that we probably have ever seen."

"The principal feature of Core SAS is a renewed focus on what we do best: serving our Nordic home market and our core customers, business travelers. Combined with a new, streamlined organization, a substantially improved cost base, a strengthened capital structure, and a more customer-oriented culture, we have all the right measures in place to create shareholder value going forward."

SAS Scandinavian Airlines' Asian cabin crew dispute

Last month I reported that Scandinavian airline SAS went on trial in Copenhagen for allegedly employing Asian flight attendants without Danish work permits. The airline also was accused of paying the Asian cabin crew members substandard wages.

The matter was heard in the Copenhagen City Court, and the Copenhagen Post reports that SAS was found guilty of the charges and fined DKK 900,000. SAS has appealed the verdict to the Danish High Court.

Meanwhile, legislation has been proposed in the Danish Parliament to allow SAS, which is partly owned by the Danish government, to use Chinese personnel on its route between Copenhagen and Beijing. Now the Copenhagen Post is reporting that if parliament does not allow SAS to use Asian cabin crew, the airline has said it may re-register its planes in Norway or Sweden.

The Copenhagen Post article quotes Lars Sandahl Sørensen, CEO of SAS International, who said, "Although it's a solution we'd rather avoid, we might be forced into it."

Planes registered in Denmark are required to operate with personnel who are legally allowed to work in Denmark. The same permit rule may exist in Sweden and Norway as well, but Sørensen said, "...if it does then it would only apply to those countries' own airspaces, and not to Denmark." In other words, the plan seems to be to fly the Beijing-Copenhagen route with planes registered outside of Denmark, in order to dodge the Danish work permit rule.

Sørensen said that employing Chinese crews has nothing to do with paying them lower wages and everything to do with service.

"It's integral for us to have Chinese cabin crews on our flights to China because half the passengers are Chinese," he said. "And it's hard to provide good service for them if we can't communicate."

Sørensen said SAS could not pay the Chinese flight attendants Danish wages because it would create a huge salary disparity between them and their colleagues working on the ground in mainland China. The Chinese crew members earn around 10,000 kroner less per month than their Danish counterparts.

This argument sounds similar to excuses given by Air New Zealand for paying its Chinese cabin crew a fraction of what it pays New Zealand nationals to do identical work. Verner Lundtoft, president of the Cabin Attendants Union, says that the SAS threat to sidestep Danish law is "appalling," and I agree.

"We're talking about a partially state-owned and listed company attempting to avoid the requirements of Danish law," said Lundtoft. "It's completely unacceptable."

Lundtoft pointed out that none of SAS' competitors have employed Asian personnel on their China routes without providing equal working conditions.

"Finnair says it pays their Asian crews Finnish wages, Lufthansa has Chinese cabin crew members earning German scale pay, and Air France has interpreters on board its Asian flights," said Lundtoft.

Apparently SAS can legally re-register its planes in Sweden and Norway, as the airline is a Scandinavian-operated company. It remains to be seen if this will solve the labor issue, however.

It's time for all international air carriers to pay all crew equally for equal work, regardless of ethnicity or national origin. No excuses!

Scandinavian airline SAS on trial over Asian cabin crew

An article on Forbes.com, the business news website, reports that "Scandinavian airline SAS went on trial in Copenhagen for allegedly hiring Chinese and Japanese flight attendants without Danish work permits." The airline is said to have paid sub-standard wages to the 34 Chinese and 31 Japanese cabin crew hired since 2005.

The news article says:

The prosecution is calling for SAS to pay a fine of 2 mln dkr and for an additional 5 mln dkr it says the airline saved by paying the flight attendants sub-standard wages, to be confiscated from the company.

Following pressure from the unions, the Danish Ministry of Refugee, Immigration and Integration Affairs decided in 2006 to file suit against SAS, which is partially state-owned, for violating Danish labour laws.

SAS explained at the time that it needed the Asian air hostesses to attend to the needs of passengers flying between Europe and Asia, insisting that the women were only in Danish air space for the few minutes it took to fly over the small Scandinavian country.

I think the claim that the women were only briefly in Danish airspace is only a cover for the true issue: money. This sounds like just one more instance of a two-tiered pay scheme in which work is outsourced to 'foreign nationals' who are paid a lesser amount to do the same work as citizens of the carrier's home country. Last I knew, this was called exploitation.

The final day of the trial is scheduled for March 17, with a verdict expected about a week later, a judicial source told the news media.

SAS grounds all Q400 aircraft until further notice

Scandinavian Airlines (SAS), the joint flag carrier of Sweden, Denmark and Norway, announced today that they are grounding their entire fleet of Bombardier Q400 turboprop aircraft "until further notice" following a third accident in less than two months.

The latest accident involving the Q400 (a.k.a. Dash-8 Q400) happened yesterday afternoon at Copenhagen when an aircraft slid down the runway on its belly after its main landing gear collapsed. Prior to landing, the crew reported problems with the main landing gear. Flight SK 2867, arriving at Copenhagen from Bergen, had 40 passengers and four crew on board. Everyone evacuated the aircraft, and no one was seriously injured.

In a public statement issued by the airline, SAS President and CEO Mats Jansson said, "Confidence in the Q400 has diminished considerably and our customers are becoming increasingly doubtful about flying in this type of aircraft. Accordingly, with the Board of Directors' approval, I have decided to immediately remove Dash 8 Q400 aircraft from service."

Jansson's deputy, John Dueholm, added, "The Dash 8 Q400 has given rise to repeated quality-related problems and we can now conclude that the aircraft does not match our passengers' requirements concerning punctuality and regularity. SAS's flight operations have always enjoyed an excellent reputation and there is a risk that use of the Dash 8 Q400 could eventually damage the SAS brand."

Last month all Bombardier Q400 with more than 10,000 cycles were grounded temporarily until their landing gear could be inspected. The action followed two accidents in Europe which entailed Q400 landing gear failures. Fortunately none of these accidents have resulted in serious injury.

[Photo Source]

Grounded: All Bombardier Q400 aircraft with at least 10,000 cycles

Today Canadian aircraft manufacturer Bombardier requested that all Q400 turboprop aircraft with at least 10,000 cycles be grounded for inspection. Bombardier officials say this is "a precautionary measure" until the cause of a series of recent accidents can be determined. The grounding order affects 60 of the 160 Q400 aircraft presently in service around the world.

This action has so far resulted in the cancellation of several hundred flights worldwide. The Associated Press reported today that SAS grounded its 27 Bombardier turboprops of the same make, and Austrian Airlines Group said it grounded eight planes. Horizon Air, the largest North American operator of the Q400, grounded 19 of its aircraft.

The Q400 has been involved in two similar accidents in the space of three days.

This past Sunday, the right main landing gear of a SAS Q400 collapsed shortly after the aircraft touched down at Aalborg, Denmark. An Associated Press article about the Aalborg accident reported these details:

The plane tilted to the right and the wing hit the ground, sending the aircraft spinning on the runway.

One propeller broke loose and sliced through the cabin, but did not hit any of the passengers, police said.

Firefighters quickly put out a fire in the right engine before the 69 passengers and four crew members were evacuated, SAS said. Five passengers received minor injuries while evacuating, the airline said.

The flight was arriving from Copenhagen.

Earlier today there was a similar accident involving another SAS Q400. Today's accident occurred at Vilnius, Lithuania. An International Herald Tribune article about the Vilnius accident says that the aircraft, with 52 people on board, "skidded off the runway, one wing smashing into the ground, after its right-side landing gear failed to lower during an emergency landing."

The crew made all passengers sit on the left side of the plane for fear that the right propeller might break into pieces and puncture the right side of the cabin, said Kestutis Auryla, head of the Lithuanian Civil Aviation Administration.

Though the right propeller was switched off 10 seconds before touchdown, the right wing still hit the ground, causing a shower of sparks but no fire, he said.

The Q400 turboprop eventually came to a stop in a patch of grass next to the airport's main landing strip after turning 90 degrees. All 48 passengers and four crew were evacuated safely, he said.

The aircraft had been en route from Copenhagen to Palanga, Lithuania when it diverted to Vilnius for an emergency landing.

An article about the Q400 in the Wall Street Journal notes that the aircraft has been one of Bombardier's best sellers in recent years, as its fuel efficiency has attracted airlines grappling with rising oil prices. The manufacturer now has 90 Q400s in its backlog and 126 on conditional orders or options.

[Photo Source]