Virgin Atlantic plans to make 1,150 staff redundant on top of 3,000 previously announced

This week, Virgin Atlantic’s recapitalisation plan successfully made its way through both the UK and US courts.

This has saved the airline from imminent insolvency but it still faces challenges ahead. Crucially, with 70% of Virgin’s routes to the US, it does not expect to fly more than 25% of its 2019 capacity in the final months of this year.

This is – clearly – a problem, given that the UK furlough scheme is about to wind down. It will leave the airline with more staff than it needs to operate the handful of flights it is currently planning.

Virgin Atlantic making 1,150 staff redundant

With this in mind, Virgin Atlantic is planning to cut 1,150 jobs across the entire business with a 45-day consultation period starting today. This is in addition to the 3,000 redundancies announced in May when it decided to pull out of Gatwick.

That would suggest Virgin Atlantic is hoping to shrink its staff by just under 50% from 2019 levels.

Virgin Atlantic is also introducing a voluntary, ‘company-led and financed’ furlough scheme for an additional 600 crew when the Government scheme ends. Presumably this means it expects to pay selected crew 80% of their normal salary, which would offer savings of 20% in the short term.

(EDIT: Unite is suggesting that the sum is nearer 50% and that the furlough would last between two and seven months. Due to the way that airline salaries include multiple ‘allowances’ based on flight hours and nights away it is never fully clear what such claims are based on.)

Shai Weiss, the CEO of Virgin Atlantic, said:

“Now we must focus our efforts on securing our long-term future, by ensuring that Virgin Atlantic not only survives but thrives as passenger demand returns. It’s clear that the introduction of passenger testing is the only way to enable the removal of travel restrictions and open up flying to key markets, while protecting public health. We will continue to work with our industry partners to press for urgent government action.”

Cutting capacity so severely is not what the airline was hoping to achieve this year as it moved towards growing its network. It may just ensure the airline’s long term survival, however.