Ryanair is calling on Aer Lingus to cut the salaries of its Chairman Colm Barrington and directors due to the airline's 'stated need to significantly reduce costs'.
Ryanair, which has a 29.8% stake in Aer Lingus, has tabled two resolutions for the airline's AGM on June 5.
Ryanair wants its rival to cut the pay packet of its non-executive chairman from the €175,000 he received in 2007 back to the amount of €35,000 earned by the previous chairman, John Sharman, in 2006.
It also wants to see a cut in the pay of Aer Lingus' directors from the €45,000 they earned in 2007 to the €17,500 they earned in 2006.
Ryanair says that any future increases in the renumeration of the both the chairman and the directors should not exceed the general level of pay increase agreed between the company and its employees.
For its part, Aer Lingus says that its board members voluntarily decided to reduce their fees by 20% in February.
'The Aer Lingus board believes that the existing non-executive directors' fees and chairman's fees are reasonable having regard to the high level of board activity and the increase in directors' responsibilities since the IPO,' the airline said in a statement.
Today's statement from the former state carrier also called on Aer Lingus shareholders to reject the Ryanair resolutions.
In a separate statement, Ryanair said that it wanted a third resolution included in next month's AGM. This calls for 'the multi million euro resignation bonuses for Aer Lingus CEO and give other senior executives should not be repeated for future senior executives without seeking the prior approval of Aer Lingus shareholders'.
Ryanair said that while Aer Lingus has agreed that its first two resolutions should be put to the June AGM, it has to date refused debate on the third. Ryanair says this is an attempt to deny shareholders openness and transparency.
'We believe that the three resolutions we have proposed are in the best interests of Aer Lingus, its stakeholders and shareholders,' commented Ryanair CEO Michael O'Leary.
'The current level of directors' fees are bloated, excessive and unjustified in a small company which has a market capitalisation of just over €300m and where those directors already receive the substantial benefit of free first class travel on Aer Lingus and other airlines worldwide,' he added.
He said that Ryanair will also use the Aer Lingus AGM to ask its chairman and board of explain why they were guiding 'a profit overall in 2008' and 'enhanced profitability in 2009' at the end of December, when just 10 weeks later they reported an enormous loss of €108m and warned of greater losses in 2009.
