British Airways 'preparing to suspend 36,000 staff'

British Airways was preparing to place 36,000 staff on furlough in response to the coronavirus pandemic and was in talks with unions on a final deal, sources said.

The airline, part of the IAG group, has been negotiating with the Unite union for more than a week.

"The final deal may look somewhat different form what has been suggested but I can't give a running commentary," a Unite spokesman told Sharecast.

Airlines globally have been forced to ground flights as governments implement travel bans to stop the spread of the virus. The agreement could leave up to 80% of BA cabin crew, ground staff, engineers and those working at head office suspended but no staff were expected to be made redundant.

All staff at Gatwick and London City Airport would be affected after the airline suspended its operations at both locations until the crisis was over. Heathrow flights were still operating.

“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," Unite said.

“Talks with British Airways are ongoing, and Unite’s priority is always to communicate with our members, who are very anxious at this time but who understand the work that Unite is doing to protect jobs, incomes and futures.”

The carrier struck a separate deal with its 4,500 pilots, who will take a 50% pay cut in April and May.

Staff were expected to receive some of their wages through the government's coronavirus job retention scheme, which covers 80% of salary up to a maximum of £2,500 a month.

IAG has healthy cash reserves and access to large lines of credit. It extended a £1.1bn credit buffer for BA by a year to June 2021 and had can tap into €9.3bn (£8.2bn) in cash, cash equivalents and loans.