Michael O'Leary

by Alan Ruddock

  The deals had obtained political prominence and power for the unions, but had had little impact on the private sector, which responded to market forces rather than grandiose national plans. It did, however, mean that Ryanair’s local difficulty with a small number of baggage handlers would become a national story and would, for only the second time since its launch thirteen years earlier, cast Ryanair in a poor light. Instead of being the people’s champions, Ryanair and O’Leary were now evil capitalists, making fortunes for the management while threatening the social partnerships, which were believed to be such a fundamental factor in the nation’s success.

  John Tierney, a union leader, caught the mood when he attacked Ryanair’s behaviour as a ‘flagrant breach of the letter and the spirit’ of the latest social partnership deal. ‘This is all the more unacceptable at a time when Ryanair claims to be one of the most profitable airlines in Europe and has awarded its executives multi-million-pound bonuses and share option benefits.’

  It was a potent combination: a lavishly rewarded chief executive, a highly profitable company and a dispute over the rates of pay of the lowest-paid workers. The NUJ’s Ryanair boycott set the tone for the media coverage of the dispute, which was weighted heavily in favour of the baggage handlers. The Mirror’s story of 9 February, ‘“Why won’t he talk to us?” – Ryanair’s striking workers in plea to airline boss Michael O’Leary’, was typical of the flavour of newspaper articles of the day, consisting almost solely of Ryanair handlers and union representatives bemoaning their plight. ‘We have given years of loyal service. We dug in when it mattered most. This dispute is very stressful on all the lads. We just want to be treated with a bit of respect.’

  The Irish Times ploughed a similar furrow. On 13 February it gave prominence to union claims that baggage handlers who had been working normally had been subjected to threats of violence, by phone, by Ryanair management. The phone calls were part of a ‘growing campaign of intimidation and bullying, both of our people who are working normally and, worse still, of their families’, according to Paul O’Sullivan. O’Leary denied the allegations but grew increasingly irritated at the media’s willingness to publish union allegations as facts, and to ignore or downplay his denials.

  Ethel Power says the dispute was in part the result of a media obsession with doing down Ryanair.

  There was a hunger out there nationally for a story about Ryanair. Michael O’Leary was doing too well. If Michael O’Leary was in America or in another country he would be invited home to Ireland, Dublin Castle would be opened to him, because he had created such a big company, such employment, contributing so much to the economy and transforming the tourism business. But because he was here living in Ireland and niggling the government every now and again, he didn’t fit.

  Almost a decade later, O’Leary is still incensed by the media’s treatment of his company.

  The coverage was all about [how Ryanair] was denying the workers rights. We were saying the majority of the workers are working, the majority of the workers don’t want union recognition. Nobody was writing that. It was all ‘Support the workers.’ The reason we kept flying and the bags kept getting loaded for about twelve weeks was because the majority of [our employees] were working. [The tone was] always, ‘The union confirms, Ryanair claims.’ We learned, midway through it, to answer every bullshit allegation they made. But you don’t always get a chance to answer the allegations; you’re not even allowed to put your point of view.

  Ryanair’s quarterly financial results, announced in mid–February, further fuelled anti–Ryanair sentiment in media and political arenas. All the financial indicators were good – profits were up by almost £3 million to £8.1 million for the three months ending 31 December 1997, compared with the same quarter in 1996, while passenger numbers grew by 30 per cent to just under a million for the quarter, due to the success of the new Paris and Brussels routes. The market responded well to Ryanair’s figures, with its share price rising by ten pence to 405 on the Dublin stock exchange. Two weeks later O’Leary announced six new route launches, all from Stansted. The routes – to Venice, Pisa, Rimini, Carcassonne/Toulouse, St Etienne/Lyon and Kristianstad/Malmo – were a significant breakthrough for Ryanair, increasing its route network by 30 per cent to twenty-six routes and giving the airline a serious presence in the continental European market.

  But Ryanair’s fight with the unions had created a growing army of critics who were quick to use the airline’s success against it.

  At a debate on transport and tourism at the European parliament in Strasbourg, Irish MEPs joined forces to condemn Ryanair’s treatment of its workers. Mary Banotti, a Fine Gael MEP, said that Ryanair was now ‘the most profitable airline in Europe’ and slammed the fact that it was still paying lower wage rates than less profitable firms. ‘Let us not hand out kudos to a company whose industrial relations practices are unjust and whose profits were built on the generosity of its employees.’

  Labour’s Dublin MEP, Bernie Malone, chimed in at the same debate, maintaining that Ryanair’s treatment of its workers was tantamount to an abuse of their human rights. ‘It is deeply ironic that Ryanair, which has benefited enormously from the economic principles set out in EU treaties, for example the commitment to air liberalization, is doing its damnedest to infringe corresponding social principles.’

  The dispute signalled open season on the airline. Now that it was in the limelight, previously unexplored aspects of the company were coming under scrutiny from the media and from politicians. Landing-charge discounts were first in the firing line, and at the end of February Transport Minister Mary O’Rourke was forced to admit, in answer to a parliamentary question raised by Democratic Left TD Eamon Gilmore, that Ryanair had saved £8.5 million between 1989 and 1994 because of landing-charge discounts. O’Rourke had taken up the post in January, replacing Brian Cowen, who had spent a very brief and unremarkable time at transport. Now she was quick to point out that AerLingus and other airlines had also benefited from similar discounts, but she said that she would be talking to Aer Rianta about the levels of the discounts.

  Just days later the media stumbled upon another gem – the fact that Ryanair had been getting large rent discounts for its Dublin airport office space from the state. Ryanair’s offices had been built on state land by Darley Ltd, a subsidiary of Tony Ryan’s children’s trust fund, in 1992. Darley had brokered a deal with then Transport Minister Maire Geoghegan Quinn that saw the government agree to waive the site’s £192,000 a year rent until 2004, and only charge 50 per cent of the usual rent from 2004 to 2010. When news of the agreement become public, O’Rourke announced she was launching a full inquiry into the circumstances of the deal.

  The unions were quick to claim the inquiry as a victory. ‘This is the end of the honeymoon for Ryanair,’ a spokesman said. ‘We are delighted to see they are finally under scrutiny after appearing for so long to be so innocent. We have received hundreds of complaints by Ryanair staff across the board since it was set up. They are people we represented yet we have been totally disregarded. The company has even ignored the Labour Court. We see this as the opening of the floodgates and the end of the cosy relationship the company has enjoyed with the state.’

  The lines of battle were clearly drawn. The unions wanted to breach Ryanair’s union-free policy and establish for themselves the right to represent its workers – and then, by extension, every private sector employee in the country. Politicians from all parties were slow to recognize the threat that the unions’ agenda could pose to Ireland’s burgeoning economy and were all too easily prepared to support the unions’ demands.

  O’Leary was not a soft target. Although he was still relatively inexperienced as a chief executive, and even less prepared for a full-scale public battle after spending most of his time below the public’s radar, he was not prepared to concede an inch. If Ryanair was to achieve its minimum objective of 25 per cent annual growth it was essential that it continue to attack its costs and lower its
fares. Competition was growing more intense, the airline was committed to acquiring new planes and developing new routes, and O’Leary needed the flexibility that only a non-unionized labour force could provide. He did not want to be trapped by detailed agreements on wages and conditions that would require negotiations every time he wanted to try something new. Stubbornly, too, he refused to allow Ryanair to become a trophy for the unions.

  The unions increased the pressure on the company by calling a two-hour protest outside its Dublin airport headquarters at the end of January. The protest drew a crowd of up to 1,000, though Ryanair claimed it was about 500. ‘It was just a demonstration to show Ryanair workers that they were not on their own,’ says O’Sullivan. ‘Ryanair management were at the windows on the fifth floor. The Garda asked them to move from the windows, and they refused. I remember the inspector from that day, he was absolutely furious. Then people started shouting abuse and the strikers shouted back.’

  O’Leary’s sense of mischief was also beginning to emerge. Non-striking Ryanair workers, encouraged by their chief executive, used megaphones to chant ‘Heigh ho, heigh ho, it’s off to work we go’ from the upper windows of the head office building. The crowd responded with shouts of ‘Scabs’ and the Irish police, unused to aggressive disputes, expressed concern at Ryanair’s ‘provocation’ of its striking workers.

  ‘Bollocks,’ says one former executive. ‘What were we meant to do? Allow a tiny minority, egged on by a union with a big political agenda, to derail the company? We were not going to lie down.’

  The following week the dispute escalated further. ‘Ryanair delivered letters to everyone saying if they didn’t report back for normal duty they were going to be fired,’ says O’Sullivan. ‘It was a threatening letter and it was perceived as such.’

  The baggage handlers held a meeting that Thursday, and agreed to report for duty on the Friday at 6 a.m. But as that Thursday progressed, O’Sullivan says he learned that Ryanair had taken steps to revoke the airside passes – passes legally required to go through airport security – of the handlers involved in the dispute. ‘I established during Thursday that the airport passes were the property of the airport authority, not Ryanair,’ says O’Sullivan. ‘I asked the airport authority if they had revoked the passes. They confirmed they hadn’t.’

  The next day, O’Sullivan turned up at the airport with the baggage handlers. ‘Ryanair had someone at the post instructing airport police not to let people through,’ he says. ‘I contacted the person in charge of the airport and established that they had no authority to refuse access and they were finally allowed through on the stipulation that I accompany them. So I did that and went with the workers to the normal place where they would check in for work, the breakroom.’

  Soon after the workers, accompanied by O’Sullivan, got to the baggage handlers’ hut they got a message from airport police, at 6.30 a.m., that Ryanair management wanted them to leave. ‘So the shop stewards rang looking for management,’ says O’Sullivan. ‘They wanted management to explain; the baggage handlers said they would talk to Ryanair on their own. Management wouldn’t come down. Finally management stopped answering the phones. I had Conor McCarthy’s mobile phone number, from his time in Aer Lingus. He answered and said, “How did you get my number? You shouldn’t be ringing this number.” Then he hung up.’

  As the confrontation intensified airport police evicted the baggage handlers from the hut, and the group made its way back to the union offices. ‘They were a very resolute group of people,’ says O’Sullivan. ‘We had long discussions and we decided to set up a picket.’

  O’Sullivan says the picket was to be placed at the gate Ryanair workers passed through next to head office, ‘to confine the impact and not to affect the airport’. But by mid-afternoon the picketers had to find a new location. ‘Ryanair told Aer Rianta to have the picket moved off their land,’ says O’Sullivan. ‘Aer Rianta was saying, “You have to go out to the public road, which is the roundabout.” I kept saying, “No, that doesn’t make sense, there’s no point in doing that.”’

  Aer Rianta threatened to go to the courts to have the picketers removed, according to O’Sullivan, so they moved on, and pickets were placed at the main airport entrance at three or four o’clock. It was there that the picket began to grow. ‘At about five or six o’clock the people on the picket line were joined by a group of women cleaners,’ says O’Sullivan. ‘One said the guys picketing could be her sons. The airport was a small place and when word spread that others had stopped work others came out and stopped work too.’ The Ryanair handlers were joined by Servisair handlers, British Midland handlers, Aer Lingus handlers and other airport staff.

  Ethel Power says the media reporting coaxed other groups out on strike. ‘It was given an unfair amount of airtime, because there was a feeling in the media that they wanted this to blow up,’ she says. ‘They wanted 1,000 people from Ryanair out protesting; they didn’t get them, so what they did was they got the next best thing, they got the Aer Rianta people out protesting and the AL people out protesting. So that did give the media a story…’

  The next day, a Saturday, the weather was cold and the ground was muddy, but the picket began again at 6 a.m. with even more groups weighing in, and it swelled to 2,000 workers refusing to cross the line, as well as taxi and bus drivers who refused to pass the roundabout, leaving passengers to walk half a mile with their luggage. At lunchtime Aer Rianta decided to shut the airport when emergency fire workers declared themselves off duty.

  Bewildered by the airport management’s docility, frustrated by its refusal to confront its workers and its failure to have a contingency plan, O’Leary watched the situation unfold from his first-floor office. ‘What they [the unions] got up to in the end was a joke,’ he says. ‘They closed the airport, CIE [the bus company] was dumping all the ould ones down the roundabout. A couple of our cabin crew got physically assaulted by the headbangers down there. We are the only airline flying. Eventually Aer Lingus walked off, security staff walked off, the whole thing came to a ball of wax.’

  Bertie Ahern, the taoiseach, was furious, and said the airport closure would make Ireland an international laughing stock. But he was also not prepared to confront the unions, and refused to send in the army to replace the striking firemen, even though their action had been illegal.

  Power says the protest did provide some wry amusement for the Ryanair workers who were not involved. ‘When Dublin airport was closed down all Ryanair employees were working, except for the baggage handlers,’ she says. ‘It actually was quite laughable on the day because the strike closed down the competition and the airport, not Ryanair.’

  The picket at the airport’s roundabout continued throughout Saturday, but the picketers were back on duty on Sunday morning.

  O’Leary still refused to negotiate and declined to be drawn into the political storm, turning down requests to meet Ahern at the taoiseach’s office.

  We got a call from the taoiseach’s office asking us to enter talks with the union. We said, ‘Fuck off and open the airport.’ It was his job to keep the fucking airport open. There was nothing he could do, it was very tense, very difficult circumstances. So we said, ‘Tell him to send in the army and open the fucking airport.’ The only thing that Bertie wanted on the Sunday when it was closed was for me to come down to Government Buildings at six o’clock. He wanted me there in time for the TVnews, so that the message would be, ‘O’Leary summoned to Government Buildings for crisis talks.’ So I said, ‘No, fuck off. Go fucking open the airport.’

  O’Sullivan says that neither he nor any of his union colleagues had any interaction with Ryanair or O’Leary, and confirms that pressure to resolve the dispute was being driven from the highest political levels. ‘The taoiseach’s office was trying to talk some sense into him at that stage,’ he says.

  In Government Buildings the situation was becoming tense. ‘Everyone was saying that the only one who could talk any sense into O’Leary was Mary Ha
rney [the tanaiste],’ recalls one insider. Ahern was desperate for a compromise. He hammered out a deal which would see the baggage handlers abandon industrial action and resume normal duties if Ryanair signed up to an inquiry into the dispute, which was to be headed up by former trade union leader Phil Flynn and former employers’ leader Dan McAuley. O’Leary agreed but refused to move an inch on union recognition. ‘These recommendations will result in an orderly return to normal working by these employees without compromising Ryanair’s principle of only dealing with its own people directly,’ he said.

  On 12 March Conor McCarthy felt compelled to write a piece for the Irish Times detailing the company’s position. He began by slamming the media coverage of the dispute. ‘Since the industrial action began nine weeks ago, the media have virtually ignored the fact that 961 of Ryanair’s 1,000 people have defied intimidation, abuse and hostile publicity by continuing to work normally,’ he wrote. ‘However, following the unlawful events of last weekend, Ryanair feels that we owe it to the 97 per cent of our employees who worked normally, to state our position to your readers.’