There are fears of significant cost cuts and possible job losses at aircraft maintenance company SR Technics after Aer Lingus announced that the company was only retaining one of its four maintenance contracts with the Irish airline.
Aer Lingus has confirmed that it is retaining SR Technics for its line maintenance contract for the next 10 years.
However, SRT Technics has lost three other Aer Lingus contracts, and fears are mounting that there may be job losses at the company.
Last year Aer Lingus announced it was putting its four aircraft maintenance contracts out to tender: line maintenance, airframe maintenance, components, and wheels and brakes.
It was known that SRT could survive the loss of some of the work, but that if it lost line maintenance, the viability of the Zurich-based company's branch in Ireland would be in doubt - with the potential loss of up to 1,500 jobs.
SRT's retention of the crucial line maintenance contract is relatively good news. However, the loss of three other contracts raises questions about cutbacks - and some sources have speculated on the possible loss of up to 200 jobs.
An internal document seen by RTÉ News says SRT needs €9.8m of investment in 2008. and a further €12.5m over the following four years.
It is targeting a minimum annual cost reduction of €5m, and plans to achieve this by a 'hiring freeze and head count reduction'.
The document points out that funding for a redundancy plan is not available.
It warns that conditions of employment concessions must contribute significantly to the €5m target.
If that cannot be achieved, a pay freeze from April 2008, which would generate full-year savings of €2m, must be considered.
Staff working conditions to be targeted for cutbacks include extending the working day, company holidays and annual leave.
It would also focus on sick leave payments, overtime, rosters, and contract cleaning.
A spokesperson for SRT said the company would now be reviewing its operations in light of the Aer Lingus decision, but not comment on possible implications at this time.
