Menzies leads plea for cash to save jobs in the aviation sector

Menzies has teamed up with the three other main providers of ground handling services to airports in the UK – Swissport, WFS (Worldwide Flight Services) and Dnata – to make the direct plea to the UK Government, calling for temporary subsistence to help the industry retain skilled staff and ensure it is equipped to take part in the eventual recovery of the aviation sector.

Thousands of jobs are at risk in the sector after demand for its services collapsed when the coronavirus crisis took hold in March, as air travel ground to a near halt under measures to stop the spread of the disease. Restrictions on air travel have resulted in a dramatic reduction of flights, with summer schedules running at only 30 per cent to 35% of pre-Covid forecasts. Winter schedules are expected to be similarly impacted.

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The four companies, which between them employ 30,000 people across the UK, state in a letter to UK Government ministers that the coronavirus job retention scheme had been a “lifeline” to the industry. However, with the scheme now unwinding and on course to end in October, they warn that “in the absence of renewed market demand and without specific financial support we may be forced to let further valued staff go in the coming months”.

Menzies, Swissport, WFS and Dnata make the case in the letter for the government to support a temporary subsistence scheme. It proposes that the companies continue to pay part of employees’ wages, with the public purse picking up the balance until the market recovers. “This would help avoid, and is substantially less expensive, when compared to a situation where employees are made redundant en masse and the government has to pay 100% of the cost of unemployment benefit,” the letter states.

“The scheme would have an end date linked to the return of pre-Covid-19 flight volumes (e.g. 85% of 2019 volume) at which point the obligation would switch back to the employer to pay 100% of its staff costs. Employees would be brought back on a tapered basis over the next 18 months as flight volumes return. This gives the government a viable exit plan.”

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The companies underlined the importance of the sector receiving funding in order to preserve skills, which will be needed when the aviation market starts to recover.

“Implementation of a scheme of this nature would prevent the loss of experienced, well-trained and security-cleared staff,” the companies say in the letter. “Retaining such staff would allow the aviation services sector to be agile as volumes return whilst providing a safe and secure service to allow airports to function, airlines to fly and the nascent economic recovery to take place. Failure to tackle the issue will lead to significant redundancies, a loss of vital skills, the likelihood of security and safety issues and ultimately could lead to the failure of ground-handling companies or the removal of services from non-financially viable airports.

“This would not only needlessly damage livelihoods but also remove an essential component of regional connectivity as planes are grounded indefinitely at affected airports.”

Menzies’ corporate affairs director John Geddes, who co-ordinated the letter, said: “The job retention scheme has been very good, and we are very thankful to that. It has been very helpful to our operations. However, having a hard stop to that for the aviation industry is going to be very detrimental to jobs.”

Menzies employed 32,000 worldwide before the crisis, but has laid off 21,000 – many of whom are on furlough – since the crisis erupted. It is consulting staff at four UK airports, including Edinburgh and Glasgow, over redundancies, with up to 1,200 jobs at risk. Around 300 jobs are at risk at the two Scottish airports.