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Air New Zealand Strike


Yesterday a group of Air New Zealand Flight Attendants finished their strike action (also here) over terms and conditions. These Flight Attendants are employed by a 100% owned subsidiary called Zeal320.

100% owned subsidiary companies are used in common practice by a number of airlines these days as an instrument to cut costs and separate employee groups. Air New Zealand is no stranger to this concept and operate a number of 100% owned subsidiary companies within the Air New Zealand Group:

  • Zeal320
  • Mount Cook Airline
  • Air Nelson
  • Eagle Airways
  • Air New Zealand Cargo
  • Air New Zealand Consulting
  • Air New Zealand Holidays
  • Air New Zealand Technical Operations
  • Altitude Aerospace Interiors
  • Christchurch Engine Center (50% owned)
  • Tasman Aviation Enterprises
  • Safe Air

Zeal320 was created out of Freedom Air which Air New Zealand set up in 1995 essentially to kill low-cost start-up Kiwi Air. Some time after Air New Zealand purchased new Airbus A320’s they created Zeal320 to operate the aircraft type for both Freedom Air and Air New Zealand. Initially 5 were painted in Freedom Air colours with the rest in Air New Zealand colours, towards the end of Freedom Air only one aircraft was painted in Freedom Air colours.

Air New Zealand Airbus A320

Air New Zealand Airbus A320

Zeal320 employed the pilots and flight attendants to operate the A320. Prior to the creation of this company A320 crews were employed separately by Freedom Air or Air New Zealand on different pay scales. With the combination of the employee groups under Zeal320 pay scales for all crews were able to more aligned with the lower Freedom Air scales. In March 2008 Air New Zealand eliminated the Freedom Air brand and the remaining Freedom Air painted A320 was painted in Air New Zealand colours.

However, the crews remained on the low-cost Zeal320 pay scales despite now only operating for the full-service Air New Zealand. When the pilots contract came up for negotiation they were effectively re-employed by Air New Zealand and put back on contracts similar to what had been in place before the creation of Zeal320. Around this time the A320 aircraft were moved back into direct ownership by Air New Zealand and Zeal320 became nothing more than an employer of flight attendants for the A320 aircraft.

Air New Zealand are of course entitled to operate their business as they see fit and the airline industry is a notoriously difficult one in which to make money. So far Air New Zealand have done quite well on this score following their re-birth back under majority Government ownership. However, I think most people expect Air New Zealand to be a fair employer given their presence as one of our largest companies and the flag carrier for New Zealand. The situation now with Zeal320 is quite disingenuous, given it is purely a shell company separating one employee group from the other ‘Air New Zealanders’ (Air New Zealand HR-speak).

Last year the Airbus A320 and Boeing 767 underwent refurbishment of their cabins to bring them more into line with the service offered on the larger Boeing 747 and 777 aircraft. The 767 aircraft fly many of the same routes as the A320’s but the flight attendants are employed directly by Air New Zealand. The Zeal320 Flight Attendants on the A320 are providing the exact same service, following the same procedures on many of the same routes but for significantly less pay. That is just plain cruel!

Prior to the strike action the Zeal320 Flight Attendants were entering negotiations with Air New Zealand for a new contract where they were asking for pay parity with their fellow ‘Air New Zealanders’ as had been given to the pilots. Unfortunately the timing of the contract negotiations at a time of global financial meltdown has provided them little favours. The reality of the timing is that the company holds the upper hand and public perception is swayed in favour of Air New Zealand despite the inherent unfairness.

Some people say they accepted the job and should quit and find other work if they are not happy. This is an over-simplified and fatalistic view that borders on embarrassing. The background of the companies existence provides reference for why the flight attendants are looking to achieve pay parity. That aside I am a firm believer that when confronted with difficulties with your employer you don’t just take a fatalisitc attitude, throw your hands up in the air and give up.

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