Air NZ opens door for trade-off between pay and jobs

A rejig of pay and conditions that would slash 25 per cent from labour costs would not make long-haul heavy engineering operations more viable than outsourcing the work, Air New Zealand said yesterday.

But the airline said it would consider saving some of the threatened 617 jobs in return for across-the-board concessions from the rest of the business' 2100 workers.

Air New Zealand Engineering Services general manager Chris Nassenstein said the airline believed that even with changes to shift patterns, removal of penal rates and the introduction of an "hours bank" at its Auckland heavy maintenance facility, outsourcing was still more economic than continuing the operation.

The airline hopes to save $100 million over five years by sending its long-haul aircraft overseas for heavy maintenance.

"The gap could probably only close if such changes are made across the entire business," said Nassenstein in a newsletter to staff.

Air NZ group general manager of ventures Craig Sinclair said: "Even with a 25 per cent labour cost reduction, we couldn't close that gap in the Auckland heavy maintenance airframe business ... you've got to be able to look beyond Auckland."

Air NZ has a substantial heavy maintenance facility for medium-sized "narrow body" aircraft in Christchurch.

Meanwhile, the Engineering, Printing and Manufacturing Union (EPMU) and Aviation and Marine Engineers Association (AMEA), which represent the Auckland workers, went to the Employment Relations Authority yesterday in a bid for more time to talk about alternatives to the job cuts.

AMEA national secretary George Ryde said the unions were challenging the use of a 58-day consultation period for discussing outsourcing leading to permanent job cuts.

"What we're looking for is an open-ended commitment from the company that they will engage with the unions to talk about proposals for retaining the maximum amount of work, jobs and skills."

Nevertheless, the unions would still table a "comprehensive proposal" on December 8.

Ryde believed it would make a viable business case to keep Air NZ's heavy engineering work in New Zealand and contained a "range of things some of which the company hasn't asked for or thought about".

EPMU national secretary Andrew Little said the proposal had been prepared with information supplied by the airline.

Having looked at that material "we think the savings that they are talking about are heavily overstated".