Restructuring events
European Restructuring Monitor (ERM)
The restructuring events database contains factsheets with data on large-scale restructuring events reported in the principal national media and company websites in each EU Member State. This database was created in 2002.
Finnish airline company Finnair is offshoring approximately 540 of its cabin personnel positions from Finland to Hong Kong and Singapore. The reductions will initially affect 20 of the routes Finnair operates globally, and will also affect approximately 80 regional cabin crew members from Adecco. The announcement comes after failed negotiations with the cabin personnel related to Finnair's goal to reduce their costs by €18 million yearly in 2011.The cabin service will be taken over by the Norwegian crew management company OSM Aviation which operates from Asia.
The reason behind the restructuring is the high wage level of Finnish cabin personnel which provides an obstacle to Finnair's long term programme to save €200 million to create economic sustainability. The cuts will only affect full-time cabin personnel, and are expected to enter force early 2015.
As reported, Finnair will fire the youngest employees first, while the more experienced employees with higher wages are forced to go on permanent leave for a maximum of two years before getting laid off. This method of reducing its workforce allows the company to maintain a 'standby' workforce in case of a sudden need to expand, while greatly reducing the costs of its operation. To date, no jobs have been cut.
Finnair dominates the domestic and international passenger air service market in Finland and is one of Europe's leading passenger airline companies, transporting over 8 million passengers per annum. Its annual turnover is around EUR 600 million. The median monthly wage of a Finnair cabin worker is €4,200.
Eurofound (2014), Finnair, Offshoring/Delocalisation in Finland, factsheet number 77500, European Restructuring Monitor. Dublin, https://dev.eurofound.europa.eu/restructuring-events/detail/77500.
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