British Airways, which is facing the biggest financial crisis of its storied history, has offered its staff between 1 and 4 weeks unpaid leave as a means to cut budget. The odd part of the story is this: they have also told staff that they are welcome to work during that unpaid leave period if they’d prefer.
I have the sense that if Southwest offered this type of arrangement, that a sizable number of workers would actually show up to work unpaid, because they have built up that goodwill over 30+ years. If I were a BA worker, though, I think I’d be pretty offended by the idea that I would come to work for nothing.
The larger part of this story is that BA’s CEO Willie Walsh says that there is no sign of recovery any time soon. US Airways CEO Douglas Parker said something similar yesterday, though he did suggest that leisure bookings may be on their way back. However, with massive cutbacks in business travel, the airlines are in crisis mode. One of the world’s most prominent carriers asking their staff to work for free for a month is only the beginning of the rough road most airlines will face over the next 3 months. I wouldn’t be shocked to see airlines face bankruptcy (again) this year (I’m talking to you, Midwest).
(Quick addition: United just put out a release saying that their 2nd quarter Revenue per Available Seat mile (RASM) will be down nearly 19% over last year. That’s a very rough proxy for average fares (very rough) – but the key takeaway is that they’re getting about 20% less revenue to fly 1 seat 1 mile than they were last year. That’s basically saying business travel continues to shrink dramatically. Oh, and while we’re adding to this post, Rick Seaney from FareCompare just wrote bascically the same column for ABCnews.com – just so he doesn’t think I stole from him :) )