Copenhagen Airports set to reduce workforce as traffic downturn begins to bite
Copenhagen Airports (CPH), arguably one of the world’s best run airport operators, today revealed that its COVID-19 survival plan includes potentially making a quarter of its staff redundant.
CPH notes that to “secure its long-term competitive strength”, it will align its organisation to the lower level of activity which the aviation industry is currently experiencing as a result of the coronavirus crisis and which is expected to continue for some time.
The upshot of this that it is contemplating cutting 650 full-time positions from the company’s current approximate total of 2,600.
Over the coming weeks, it says that discussions will be held with CPH’s union representatives to determine the expected redundancies, which Copenhagen Airport CEO, Thomas Woldbye, describes as “The saddest decision” he has had to make during his nine years with CPH, but one that it is necessary in order to safeguard the airport’s future operations and financial position.
He comments: “It’s very sad that we’ll have fewer employees at CPH. Our goal during the crisis has been to maintain as much activity and retain as many jobs as possible at the airport. The coronavirus support packages passed by the Danish parliament have made a big difference to us.
“In particular, thanks to the most recent extension of the wage compensation scheme, we now have more information about the travel patterns of the future and with that, we may not have to lay off as many people as would otherwise have been necessary, had the scheme not been extended.
“However, given the current trends in air traffic flows, I’m afraid we have to accept that we’re not in a position to retain the number of employees we had in pre-corona times.
“All current figures and projections indicate that air traffic is unlikely to return to its previous levels within the foreseeable future. Many sources predict that the aviation industry will not be back to normal until some time between 2022 and 2024. That is why we’re now commencing discussions with our trade union representatives to explore how we can best align the work force at the airport to the reality that we are now facing.”
In June, CPH announced plans to cut its costs by DKK950 million, but the predicted prolonged nature of the COVID-19 enforced downturn in global traffic means that this is no longer considered enough to see the company through the next few years.
As a result, CPH is considering removing 650 jobs across airport functions as part of the cost cuts. If this number of jobs is cut as contemplated, it would contribute to reducing annual operating costs at the airport by approximately DKK325 million, although due to the current terms of termination, it will have only a very limited effect on the results for 2020.
“We need to prepare for a period with reduced activity so that, as an airport, we can remain a competitive and attractive hub in northern Europe,” states Woldbye.
“We must be able to attract and retain routes so as to support growth and employment in Denmark. Moreover, it’s absolutely crucial that we can continue to work on and pursue our high ambitions for contributing to the necessary green transition of Danish aviation.”
CPH’s works council will be briefed later today on the situation and the decision made, including on the fact that adjustments need to be made to a number of local agreements, which are therefore expected to be terminated.
Together with CPH’s other management representatives, CHRO Kirstine Bergenholtz will negotiate with union representatives over the coming weeks to agree how cost cuts and redundancies are to be implemented.
During the talks, the parties will also consider how various mitigating measures may be applied, such as supplementary training and upskilling, in order to support the employees and the company as much as possible during this difficult period.
CPH will announce the outcome of the negotiations once they have been concluded.
“We will do our utmost to ensure a proper redundancy process and will do everything in our power to help those of our colleagues affected to move on to new jobs,” says Bergenholtz.
“We are working with the union representatives as well as the new job centre recently opened at the airport and the unions to find appropriate solutions for all those affected.”