THE PRESS WEDNESDAY, MAY 19, 1982. Air New Zealand’s hopes

Press, 19 May 1982, Page 14

THE PRESS WEDNESDAY, MAY 19, 1982. Air New Zealand’s hopes

Air New Zealand’s “recovery plan,” as it has been explained so far, has done nothing to allay anxiety among the airline’s employees about their future. They, along with-the rest of the country, had been led to believe that the long-awaited decision on staff redundancies would be revealed in the plan on Monday. Instead, the issue has been shelved for another two weeks.

The management probably has sound reasons for not wanting to reveal its hand at this stage; perhaps the actual number of staff to be laid off will not be determined until the airline, obtains a clearer picture of the expenditure that will be required to settle redundancy claims. The desired target might not be economically possible if the cost proves to be too high. The airline, of course, might have simply wanted Monday’s announcement to impress upon employees the seriousness of the airline’s plight, and to soften up the unions for what clearly will be some tough bargaining. Whatever the reasons, the airline would have created a more favourable public relations image had it said last . week that details about redundancies could hot be included in Monday’s announcement. As it happened, the company’s 8000 employees have cause to believe that they’were misled.

The proposals outlined on Monday are surprisingly optimistic. Air New Zealand’s management is looking on the bright side. Instead of proposing a great contraction of domestic and international activity, the airline has preferred a positive and hopeful approach — perhaps too hopeful. Nevertheless, it will approach redundancy negotiations with the most favourable option, presumably entailing the smallest number of redundancies. This optimism means that a high risk is being taken. If. the unions do not endorse this course, they will probably be confronted with a much less attractive choice: a plan demanding less risk, curtailed services, and even higher redundancy.

As long as the question of staff redundancies remains unresolved, the success of the recovery programme must remain uncertain. The airline’s prediction of profitability within two years, therefore, can only be viewed with a degree of scepticism until redundancies have been negotiated. The company still has no guarantee that it will win the full support of all its employees’ unions. The threat of industrial disruptions introduces a sobering degree of reality to any speculation on an early return to profitability.