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January 24, 2018

Globalisation – threat or opportunity?

It’s more than 12 months now since Prime Minister, Theresa May, said that “liberalism and globalisation have left people behind”, in her address at the Lord Mayor’s London banquet. Will Scott, acting chair for the Professional Pilots’ Union (PPU), examines the impact this globalisation is having on the airline industry.



Mrs May spoke of our communities “changing around them” and the emergence of a global elite who sometimes “seem to play by a different set of rules”. And, that there exists a definite discord between those who are gaining and those who are being left behind.


She rightly picked at a raw nerve here.

And, one area where the reach of globalisation is becoming ever more critical is in the airline industry. Big businesses set their own agendas to create what has undoubtedly become the “gig economy in the sky” which in turn, has impacted pilots and our passengers.


Customer service has been compromised significantly. In fact, BA has recently stopped serving meals on short haul flights, while relaxed regulations have led to pilot fatigue – against the better judgement of the unions.


Why globalisation?


Big businesses see globalisation as a way to greater profits. And, lobbying governments and regulatory authorities for open skies and more relaxed regulation, has become the norm. The world’s richest airlines are coming together in ever-larger alliances that can now dominate in their global reach.


At the same time their power to influence change is becoming harder to withstand.


For instance, regulatory changes to flight time limitations in the UK have been heavily influenced by the airlines at the International Air Transport Association (IATA), which represents 86% of the world’s airlines. And, the European Air Safety Agency (EASA) was convinced to introduce more relaxed regulations relating to fatigue amongst aircrew - against scientific advice.


Pilot unions objected heavily but were ignored in favour of this new global elite.


The “gig economy” in the sky


This has created what has been termed “the gig economy in the sky”. The relaxation in regulations has given rise to low cost alternatives that can outsource aircraft from one country and pilots from another.


Companies such as Ryanair, and more recently Norwegian Airlines, have vaulted into the market with a much lower cost base, contracting pilots overseas and basing them overseas, thus allowing trite recognition of national regulations because they simply fly in and out.


Of course this might seem attractive to the consumer with the prospect of ever-decreasing airfares around the world, but there is a worrying aspect - who checks the checker? What safety system is autonomous?


In a damning analysis on trends within the European aviation industry, an EU report titled Atypical Employment in Aviation, gives us a vision of what the future might be like for pilots, crew members and passengers.

In condemning what it calls a “race to the bottom” as a result of “new emerging business models such as outsourcing through elaborate subcontracting chains”, the report paints a bleak future where the welfare of pilots and the safety of passengers is compromised.


It concludes that a fair balance between safety provisions, and employers’ and workers’ rights, is of “paramount importance” if the wellbeing of pilots and the safety of passengers is to be secured.


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Big impact


Pilot unions have warned that fatigue is now becoming a major issue. This will be exacerbated and will impact all UK pilots now that the once independent Civil Aviation Authority has become a small part of EASA.


Even the National Air Traffic Services (NATS) is owned by a public private partnership - the Government (49%), The Airline Group (42%), LHR Airports Limited (4%) and an Employee Share Trust (5%). The Airline Group comprises British Airways and Virgin Atlantic.


Likewise, customer service has been dealt a blow, and the larger established airlines have been forced to respond with cuts in service, such as BA’s refreshments policy, as the race is on to make the business of operating aircraft cheaper. This, I fear, is just the tip of the iceberg.


Of course the bomb-burst of communications to employees, often less than truthful and certainly disingenuous, is all part of the plan to stifle union power and intimidate workers into conforming. All of this is a well-worn mantra and none of it leads to happy companies providing a safe and well cultured service.


And, what of the unions?


The unions can be complicit here too. Regulation of trade union strength in the ‘80s may have been welcome then but could it have gone almost too far? Large companies like to corral unions into what is often known as ‘modern industrial relations’, the cosy fireside chat where we can sort it all out is not necessarily in employees’ interests or in that of air safety.


The most recent and less publicised example of this is occurring right here at Sir Richard Branson’s Virgin Atlantic Airlines. The British Airline Pilots Association (BALPA) has traditionally represented pilots here, but many felt let down by its close relationship with the Company management.


Collectively, the pilots at Virgin formed their own union, the PPU, which now boasts around 75% of the unionised pilot workforce and 65% of the total number of pilots.


Virgin Atlantic clearly sees this as a threat to its future plans and has employed every tactic it can to postpone or avoid recognising our union in its midst.


Talks have intermittently gone on for 3 years and no progress has been made, leading to pilots withdrawing their “good will” until further notice in protest at Virgin’s reticence to accept an overwhelming case for recognition.


The Prime Minister went on to say in her speech: “Because when you refuse to accept that globalisation in its current form has left too many people behind, you’re not sowing the seeds for its growth but for its ruin.”


While globalisation garners commercial strength, it should not be at the expense of economic stability that is underpinned by a motivated and appreciated workforce, or indeed to the detriment of employee wellbeing and passenger safety.


So, when our passengers are flying off on their holidays or travelling on business, consider this. Who would they rather trust, the regulators in the operators’ pockets, the operators in search of the cheapest option, or the pilot in control of their plane?