THY and union zealots

The ITF was either misled or has no idea whatsoever what Hava-İş, its only member and affiliate in Turkey, has been up to in recent years and how it has been messed with by the ideological zealots who are supposed to manage the union and take care of the workers' rights rather than act like a radical political party on the center left, locked in an eternal feud with the national airline company. In fact, it seems to me the other way around, as the track record of the union suggests that it has been trying to bankrupt the airline.

The government having pushed through Parliament and successfully adopted an amendment banning strikes and lockouts in the aviation sector has come after too many headaches the Hava-İş union has caused Turkish Airlines (THY) and the national economy, resulting in millions of dollars in lost revenue. The government's move came in response to more protracted negotiations between THY and the union after the latter engaged in an unlawful protest and work slowdown, with many union members calling in sick. This caused THY to cancel 223 flights earlier this week, stranding 100,000 passengers in one day.

Since the aviation industry is a strategic one and is closely connected to other industries, any interruption in services rendered by the industry may have devastating results on other businesses operating in the trade, cargo, export, tourism and hospitality industries. Strikes or lock-outs in this sector have a deep impact on the national economy, businesses and citizens alike while hampering the very competitiveness of the Turkish economy. Hava-İş should have been extra careful not to play with fire when it comes to managing the rights of workers in this key industry. Yet what we have seen was it acting mostly on an ideological basis and refusing to compromise in any way with THY.

For example, I did not understand why Hava-İş tried to force its union members to strike in 2010 when the government was locked in a dispute with tobacco industry workers after the public company Tekel, Turkey's alcohol and tobacco monopoly, was privatized. When Tekel workers staged demonstrations, the Hava-İş union invited its members to support the demonstration by striking. Fortunately, union members disregarded the call and showed up to work so that flights in İstanbul were not affected.

Union President Atilay Ayçin, who made a career for himself running the union for 24 years, is a colorful figure. He contributed to the campaign in 2005 against the privatization of the state-owned Cellulose and Paper Factory (SEKA), which had been losing millions of dollars each month. He also opposed the initial public offering (IPO) by THY in 2004 and lambasted management for its bid to join the Star Alliance network in 2006, claiming it would turn THY into a contractor for big companies. In his words, THY executives did not even know how to fly a kite, yet they were managing an airline company. Because he faced problems with restive members within the union, Ayçin had just barely been elected at the last union congress in 2009, winning by a single vote. For that, he is accused now of escalating the crisis with the THY management as a way of covering up his problems within the union. He has staunchly opposed a compromise deal for 18 months now. Isn't that classic?

Every year, the negotiations between the THY management and the union have been painstakingly difficult, protracted and always brought to the brink of a major strike against the airline. Months of talks always proved futile and the union used to declare a strike after an official notification was made at least six days before the walkout would begin. However, the Cabinet can rule to postpone strikes or lockouts against strategically important companies for 60 days if they are considered to go against public peace or national security. Even when the government was prepared to invoke that moratorium, union president Ayçin threatened to ground all planes. “It is essential for flights to be punctual during the tourism season. If they try to put obstacles in the way of the strike, I won't let their flights be on time. They won't be able move even a single aircraft. It's their decision," he said on one occasion.

The government finally acted this time by refusing to be bullied or blackmailed by the overzealous union head. When Metin Külünk, İstanbul deputy for the ruling Justice and Development Party (AK Party),  submitted on May 10 an amendment to the 1983 Collective Labor Agreement, Strike and Lock-Out Law, also known as Law No. 2822, it changed everything. The amendment was approved by the parliamentary Interior Commission on May 25 and was voted through the General Assembly on May 31. President Abdullah Gül is expected to sign it into effect. By the way, this new arrangement is not unique to Turkey, as there are similar regulations and laws in other countries either restricting or banning strikes in key industries.

Obviously the government did not want THY to end up like bankrupt Swiss Air or the Belgian airline Sabena and had to take measures to insure the healthy growth of THY.

Contrary to the assumption that labor costs are cheaper in Turkey for the aviation industry, the numbers tells completely different story. Transportation Minister Binali Yıldırım disclosed the figures during the debate in Parliament on Wednesday, saying that the unit labor cost (wages and benefits per kilometer) for THY is 3.05 euros, while the cost for British Airlines and Swiss is 2.66 euros.

The reason for this is the Hava-İş union having taken THY hostage to its demands for many years as it was simply not possible to replace union workers in a short time, leaving the management no option but to yield to union demands. Binali also dismissed claims that wages paid by THY are lower than other airlines in Europe. “If that was the case, you would not see some 700 foreign pilots flying the planes for Turkish Airlines,” he noted, disclosing the actual salaries of pilots and crew members to the public.

Because the aviation industry needs highly skilled workers, technicians and engineers, when they strike you cannot find replacements right away. As was the case with the unlawful strike last week, THY had to lease crews from other airliners as a partial fix to the problem. Even that was not enough, though, because the union represents some 12,000 members and the airline had to cancel 223 flights, amounting to a single-day loss for THY of $2 million. You simply cannot compete with other airliners in the world when a union strike at any time hangs over the company's head. The union has no incentive to reach an agreement with management unless it gets its way because it can practically shut down THY for good with strikes. That was the main reason why the current talks have not reached a settlement in 18 months now.

The booming airline was posting a profit until two years ago, although its profits have steadily declined since 2008, when it announced profits of TL 1.1 billion. Profits dropped to TL 286 million in 2010. Last year, it lost TL 1.7 billion. In the first quarter of this year, the loss was TL 29 million. THY had no choice but to control labor costs in order to remain competitive and stay alive in this tough industry. The union has not been helping THY at all, instead demanding more and more. During his speech at Parliament, Külünk even claimed that some external powers were conspiring with certain elements in Turkey to destabilize the national airline, accusing the union of acting irresponsibly. “The new union concept is to help grow and expand the company it represents,” he said, advising the union leader to settle the matter at the negotiating table.

The fact that the union has even run ads both in national and international print media in the past, claiming that THY was not safe because workers were forced to work overtime, gives some credence to Külünk's claims. The ads prompted legal action by THY, which accused the union of launching a smear campaign to discredit the airline.

The government had no choice but to adopt this new amendment to permanently remove the threat that had been looming over the nation for years now. Because the national airline is vital for the economy, and especially for the export and tourism sectors, millions of jobs were at stake. Even for our media business, we cannot deliver print media in time to our subscribers if there is a strike at the airports; the paper did not get delivered on Wednesday because of the strike the day before.