VIRGIN Pilot Federation

Virgin Australia Narrow Body

The AFAP Virgin pilot representatives wrote to the Chief Operating Officer and Chief Pilot late last year setting out why the current 2021 EA pay structure is no longer fit for purpose and to propose early bargaining.

In February this year, AFAP pilot representatives met with the Company and provided direct feedback as to why we believed that a variation to the current closed EA to improve the hourly rate or base salary was justified. The AFAP pilot reps made clear that without a reset in the relationship which addresses the issues with the current Enterprise Agreement (EA) - primarily base salary and certainty of income - there is an increasing likelihood of an acrimonious negotiation.

While Virgin did not agree to bargaining early it did ask what it would take for the AFAP to support a 12 month extension to the 2021 EA. This resulted in a survey to members, in which 88% of respondents endorsed our pay proposal for an immediate 15% pay rise (followed next year by another CPI increase) in exchange for a 12 month extension.

Virgin responded recently advising it was rejecting our proposal, and instead proposed the parties commence negotiations for a new EA right away (around four months early). Virgin advised it had rejected the AFAP pay proposal as too costly when there were not productivity offsets included in the package.

The Company acknowledged that the Virgin Narrow Body EA is flawed from the pilots perspective. This is a significant concession considering this EA was pushed through by Virgin under the threat of returning pilots to the Award during the pandemic.

CAE Crew Management System

With the system now delayed and no alternative option available (Virgin has previously tried and failed to move to Jeppesen and then Sabre CM rostering systems) there is no confidence amongst the pilot group in the Company’s ability for the business to deliver on its commitments.

Pilots remain on interim conditions

The result of this “pause” is Virgin pilots remain on the “interim” EA conditions, which was an appendix that preserved much of the 2018 EA until CAE CMS was implemented. The AFAP at the time had little confidence in Virgin to deliver the system and as such negotiated to protect as many of the 2018 conditions as possible.

The main area we were unable to preserve was the base salary which was reduced by around 17% on the basis that pilots moved to a lower productivity pay trigger (69 hours down to 57.5 in a 28 day roster period). The rostering system at the moment is not functioning with a 40 hour range of rostered hours at publish. As a result, pilot incomes are unpredictable from roster to roster.

80%

Subsequently, Virgin has announced it is “pausing” its CAE CMS system implementation. This project has been running for more than two years and was to replace the current Sabe Aircrews rostering system and Kronos PBS.

The implementation of CAE formed a key part of the 2021 EA negotiations as cutover to a new CMS was required before pilots moved to the 2021 EA conditions in full. Pilots were also going to finally have access to a fully automated Open Time/Trip Swap system which had been first mooted a decade ago.

Further pilots receive zero credits for unused SBY so it is resulting in pilots unfairly earning less than others even though they are available for duty. Another issue has been displacement from flying, where pilots lose hours (due to cancellations) and again reduce their incomes.

In order to address this inequity, Virgin has put a credit protection system in place (where a pilot is paid at least their rostered publish credit total unless they remove themselves from duty due to illness or fatigue), and also implemented four credit hours for an unused standby. While this will go some way to address structural flaws in the pay system it will not address the fact that pilots even working high hours continue to earn less than they did under the 2018 EA.

AFAP Response to early bargaining

The question for the AFAP Virgin Pilot Council is whether there is any benefit in beginning negotiations early when the Company does not know what rostering system it will be using.

Given the current Sabre Aircrews system is unsupported by the provider and the myriad of rostering problems occurring (high SBY, broad range of credit hours) it is difficult to see members supporting remaining on a productivity-based REM system. Instead, we expect members will want to return to the higher base salary structure from the 2018 EA.

The AFAP has fielded questions from some members concerned that early bargaining is a strategic trap that will be to the disadvantage of pilots. We have not had any members provide specifics as to what this disadvantage may be, however we recognise there is significant lack of trust amongst pilots as to the genuineness of the Company proposal which has only worsened with the CAE CMS pause.

Many EAs across the industry have mandated periods of bargaining prior to the nominal expiry date and generally all that happens is a series of meetings in which little progress is made until the expiry date approaches. Since the 2002 EA no Virgin pilot EA has ever been negotiated and successfully voted up within 18 months from bargaining commencing.

Virgin confirmed its general wage position was 3% per annum with any additional benefits dependent on productivity gains.

Virgin confirmed its general wage position was 3% per annum with any additional benefits dependent on productivity gains.

Virgin also confirmed its preference to remain on the lower base salary system but recognised that the reward for working more hours needed to increase.

The overwhelming feedback from members is that the pilot group is not likely to consider productivity offsets unless this was to push remuneration above the 2018 EA earnings once CPI increases are factored in, which will be considerably more than 3% increases. Pilots feedback is that they have gone backwards and this EA at a minimum must restore them to where they should be in the market without the need for productivity offsets.

Virgin Australia Regional Airlines

The focus for the AFAP at VARA has been negotiations for a new VARA Enterprise Agreement. The scope of the EA is proposed to cover the existing A320 and F100 fleets as well as the introduction of B737 fleet which will replace the F100s.

Recently, VARA announced the extension of the replacement timeline of the F100s, with three F100 aircraft to continue operating on the VARA AOC until March 2025. Discussions are underway to ensure that F100 Pilots who remain on the fleet are not financially disadvantaged for the delay.

Working with our pilot representatives and the SALPA committee (an elected pilot representative body for VARA pilots), the AFAP has tabled a detailed EA package supported by extensive benchmarking. VARA has since reviewed and costed this proposal and responded with a proposal that was not acceptable to the AFAP.

Given bargaining has been ongoing for more than 12 months, the parties have scheduled multiple meetings in June to push to close the gap between the parties and reach an agreement.