As reported in Ch-aviation, a settlement between the seemingly indomitable Ryanair and an Alabama-based pension fund is to be heard at the Court for the Southern District of New York on October 20th, at 12:30pm local.
What happened before now?
In 2017, Ryanair’s Chief Executive Officer Michael O’Leary, who has held the role since 1994, asserted at the AGM that “hell would freeze over” before the airline would ever accept staff unions among its ranks. Unfortunately, this preceded a threatened strike and soon after, the carrier changed its tune to officially recognize pilot labor in a bid to avert a labor shortage.
Unions represent employees’ interests and often champion better and safer working conditions, higher salaries, and more benefits. As such, it is no surprise that at the end of 2017, on the heels of accepting pilot unions, costs at the company were increased and profits dwindled.
This led to “millions” in shareholder value being wiped out. Low-cost carriers’ unions have been known to oppose the founding of bases and hubs across Europe, so recognizing such bodies could have hindered the company’s ability to double down on strongholds in regions like Scandinavia and France.
Photo:Â katatonia82 | Shutterstock
Following O’Leary’s statements, the City of Birmingham Firemen’s and Policemen’s Supplemental Pension System led a class action suit against Ryanair Holdings and O’Leary in 2018. It was claimed the airline had been releasing incorrect and misleading information to stakeholders regarding labor issues at the firm. It was alleged that similar and such statements intentionally inflated Ryanair’s share prices, and thus its overall value, at a time when stocks were quick to fall at any prospect of workers unionizing. All claims were vehemently denied by the airline.
It would appear as though the company was cutting its losses to mitigate potential fallout and economic disinterest at the hands of its employees seeking representation.
What will happen next?
Reuters reported that on June 7th, 2023, in the Manhattan-based US District Court, a financial settlement of US$5 million was reached between Ryanair and the pension fund. In October, the settlement will be heard and hopefully approved so all parties may move forward.
Robbins Geller Rudman & Dowd LLP, lead accusatory counsel in the case, said the hearing would determine if claims against Ryanair should be authorized and whether the settlement is “fair, reasonable and adequate” to the class action members. Any objections to the settlement must be mailed by September 29th to the court, Robbins Geller Rudman & Dowd, or defending counsel Cleary Gottlieb Steen & Hamilton LLP.
Following a strong Easter travel period, Ryanair is certainly on a winning streak, having posted quadrupled profits in Q1. Consequently, new routes, additional capacity for the record-breaking demand, and the influx of new planes lie on the horizon.
However, not for nothing, employees around the world will, as ever, seek better conditions and pay across all sectors. Just recently, it was reported that the airline’s Belgian pilots were striking again.
Photo: Ryanair
This summer has joined a suite of consecutive summers in which strikes have been leveraged and carried out. European strikes were summarized in an article last week. Meanwhile, Air Tahiti Nui recently canceled a number of flights at the last minute, American Airlines crews are setting the ball rolling for anticipated industrial action, and London Gatwick strikes were just called off after workers voted for a pay rise.
We await the settlement hearing in New York in October and, disputes aside, look forward to the industry’s ongoing post-pandemic recovery.
Photo: Ryanair Ryanair
- IATA/ICAO Code:
- FR/RYR
- Airline Type:
- Low-Cost Carrier
- Hub(s):
- Dublin Airport, London Stansted Airport, Milan Bergamo Airport
- Year Founded:
- 1985
- Airline Group:
- Ryanair Group
- CEO:
- Eddie Wilson
- Country:
- Ireland
