On Monday, Air France employees, protesting coming job losses, mobbed executives. The company’s deputy director of HR, Xavier Broseta, was forced to scale a fence in order to escape them. Today, we learned that his job too is disappearing — or rather, that he would be vacating it — a move that Air France says is unrelated to the labour unrest. What is going on over at Air France?
The protesting employees are pilots, who have been in negotiations with management while the company restructures. The most recent offers have included longer working hours and significant job losses. Although France has a strong labour movement, with a history of determined and sometimes radical protest, the Air France protest, which devolved into pilots ripping the shirts right off of executives backs and shoving them, was widely condemned by labour leaders and even France’s Prime Minister.
The French government owns a 15.88% share of Air France, which is the fifth largest transportation company in the world. According to the Guardian, the company’s restructuring was spurred by an increasingly competitive deregulated industry.
“Increased competition from Middle Eastern rivals and budget airlines recently prompted the loss-making group to seek a reorganisation and €1.8bn (£1.3bn) savings. The company is also planning to close five long-haul routes and sell off 14 of its larger, long distance aircraft.”
Air France executives, like HP, have tried a series of “fixes,” none of which have been effective and in the course of trying to rescue the company, their relationship with employees has degraded. Secretary General of the CGT Union, Philippe Martinez, was quoted in the Guardian as saying, “For several years now, successive heads of Air France have suggested rescue plans … each time, it’s a bottomless pit with the same suggestions. I believe they are trying to set one lot of us against the other. We need a real expert appraisal of the situation.”
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Meanwhile, Bloomberg reports that Xavier Broseta is being replaced by a political aide, currently on the Prime Minister’s staff. Gilles Gateau’s appointment to deputy director of HR has apparently been “planned for months” and Broseta is being shuffled to some as yet unnamed role within the company. According to Bloomberg,
“The confrontation near Charles de Gaulle airport has led to a bout of soul-searching among the French political establishment, and it’s not yet clear whether the publicity around an attack where the crowd chanted ‘naked, naked’ as Broseta and long-haul chief Pierre Plissonnier were assaulted will strengthen or weaken management’s hand.”
Gateau’s appointment is being read by some as the French government intervening in the labour crisis — what affect that will have on the negotiations is yet to be seen.
Watching from North America, the key question for me is: how did things get so bad and what can we learn from the crisis?
Air France’s current problems started in 2008, says Reuters, when the European airline industry was shrinking in response to Gulf competition. Unlike other airlines, Air France chose not to reduce routes, pay or restructure. Seven profitless years later they’ve been forced to rethink that decision. They plan to shed almost 3000 jobs by next year — as many as 8000 when all is said and done — and increase pilots’ working hours, and they’ve failed to get the labour unions on side: it’s too much, too soon, and perhaps even too late.
In addition to Air France’s lagard response to changes in the industry, it has a complicated labour situation to contend with. It’s not just a unionized workplace, there are several unions representing different groups, and management doesn’t seem to have a good relationship with any of them. “We fear attrition will bring on more attrition — a death spiral for our company,” lore Arrighi, President of the Unac cabin crew union, told Reuters.
Well, what’s the take away, aside from “please never let this be me”? It’s threefold, I think.
- Don’t be blindsided by changes in your industry and don’t delay in responding to them.
- Cultivate a cooperative, not adversarial, relationship with employees and their union representatives.
- Plan for the future, not the present or the past.
The challenge for Air France now is catching up, radically restructuring, and somehow rebuilding their relationships with employees. It’s a worst case scenario that crept up on them while executives kept predicting clear skies and a return to profit.
Look to the future of your organization now, lest you be in their shoes tomorrow.
Photo: Kenzo Tribouillard/AFP via Getty Images.