By Kate Holton
LONDON (Reuters) - British Airways (L:ICAG) is in talks with its union about a plan to suspend around 32,000 staff, a person familiar with the situation said, marking one of the industry's most dramatic moves yet to survive the coronavirus pandemic.
Having already agreed a 50% pay cut for its pilots, the British flag carrier is now nearing agreement on a deal to suspend around 80% of its cabin and ground crew, engineers and office staff to see it through the worst crisis in its history.
Owned by IAG, one of the largest and most financially robust airline companies in the world, British Airways has already said it is in a fight for survival.
"The deal is not done yet," the source said.
It has joined the global industry push to ground flights and slash costs. In recent weeks Qantas Airways (AX:QAN) put two-thirds of its workforce - 20,000 workers - on leave while Lufthansa applied for short-time work for around 31,000 crew and ground staff at its core brand until the end of August.
British budget airline easyJet (L:EZJ) has said it will lay off its 4,000 UK-based cabin crew for two months.
U.S. airlines are set to receive $25 billion in grants to cover payrolls over the next six months, but are still encouraging workweek reductions, unpaid leaves and early retirements as they face more cancellations than bookings.
The companies are trying to avoid making staff redundant so they can respond quickly to any increase in capacity when a recovery comes.
British Airways has been in talks with the Unite union for a week. "Unite has been working around the clock to protect thousands of jobs and to ensure the UK comes out of this unprecedented crisis with a viable aviation sector," a spokesman for the union said.
IAG, which owns 598 aircraft across its network which includes Aer Lingus, Iberia and Vueling, is cutting capacity by 75% in April and May. BA has already suspended flights from Britain's second busiest airport, Gatwick, and London's City Airport.
With planes unable to fly because of travel restrictions, compounded by a plunge in demand over fears of contagion, airlines worldwide have grounded most of their fleets, and many have said they need government support to survive.
In Europe more than 20,000 flights departed or landed on January 23. Two months later, after Italy emerged as an epicenter for the virus and travel restrictions went into force, flights dropped to fewer than 5,000 per day.
Britain has launched a job retention scheme which covers 80% of someone's salary capped at a maximum of 2,500 pounds a month. But some airlines including rival Virgin Atlantic have said they will collapse if they do not get more help.