Sir Richard Branson
2 for 1 tickets to Casablanca, this coming Monday
Dear Colleague,
Although I am no longer overseeing Virgin Atlantic on a day to day basis, as its founder I keep a watchful, and proud, eye over its progress. From one second-hand 747 twenty three years ago, it has turned into an airline that everyone working there can be truly proud of. Everyone who comes into contact with Virgin Atlantic leaves with a smile.
Having set up Virgin Atlantic I know only too well how challenging managing an airline can be. History is littered with carriers that have gone bust - Laker Airways, Dan Air, Air Europe, British Caledonian, and just last week, Maxjet, which had been in business less than 18 months. In our relatively short history, we’ve seen the demise of every airline we competed against back in 1984 (except BA). TWA, Pan Am, People’s Express, Air Florida to name but a few. Even the mighty Continental Airlines, Delta, Northwest and United all went bust only to be bailed out by the US Government with massive loans. One of the principal reasons for these airlines’ demise was internal strife.
Remarkably, Virgin Atlantic has survived against all these giants thanks largely to the attitude and hard work of its staff - by everyone working well together, by ensuring that we are the best airline flying and by having a management team who (by and large) have managed and are managing it well and who are willing to take tough - but necessary - decisions on occasion.
The only other airline to have survived across the Atlantic is British Airways. Unlike Virgin it didn’t grow from one plane with no support. It used to be the national airline and was privatised some 20 years ago with a very large silver spoon in its mouth. It was given the bulk of slots at Heathrow and Gatwick, much of the infrastructure and even Concorde, which had cost the taxpayer hundreds of millions of pounds to build, it was given for one pound.
BA also has the luxury of a short-haul network to feed its long-haul. As a result it has made - and can make - significantly larger profits than us.
Virgin Atlantic has never had any handouts and therefore to survive we have to keep our costs under control.
I’m afraid that those in the union who compare Virgin Atlantic with British Airways are being very unrealistic. It’s like comparing chalk with cheese.
Most people who joined Virgin realised that. They knew that their basic salary was usually not the same as BA’s. But they joined for the benefits that came with working for a smaller, more friendly company. (I know - and I am sure you know - quite a few crew who left Virgin for BA for better pay only to return to Virgin for those other benefits).
I have discussed at length with the senior team whether there is anything more that they can safely do to help and I believe them when they say that the final offer on the table is the best they can or should do in terms of addressing cabin crew salary packages.
There comes a time in any negotiation when a good management team has to draw a line in the sand and I agree with them that time has come. To go further would result in unacceptable risks and would set a dangerous precedent to the company as a whole. It would be irresponsible of our management and they, rightly, are not going to take that risk.
For some of you more pay than Virgin Atlantic can afford may be critical to your lifestyle and if that is the case you should consider working elsewhere. For the vast majority of you, the pay rise you were offered was the best in the industry this year, which is why the union strongly recommended it. I’d urge you not to put at risk our ability to solve this dispute by messing up our customers’ travel plans.
We all want to resolve this situation and give the best pay increase that the business can afford. The best way to achieve this is by keeping all of our planes flying and delivering what we do best - making sure that all of our passengers leave with a smile.
Thankyou and have an excellent New Year.
Richard Branson
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Why is it that someone has to attack on a personal level. 'Where are the profits going' BigWigs in the office' 'decent wage' 'Its ok for you' These comments are made by the 95%ers. STOP for one moment please. And this it for everyone who is in agreement with these comments, directed toward Mr Branson and his leaders. Not trying to stereo type, reality is that 95% of people actually think this way. Rich people evil, not enough money for me. Well have you ever stopped for one moment in history and asked yourself. How is it done? Asked youself the big, WHY cant it be me? Instead of attacking people for reaching success-learn from them. Change your thinking. Remember they didnt just win lotto!! They are not lucky, they made it happen. Start educating yourselves people. Read the books, mix with people higher then yourself-learn from them. Dont reinvent the wheel. "What you do today is your future" SO CHANGE IT!!!
John Lucky, Wollongong, NSW
Cant they see OF COURSE THERE IS PLENTY of money in the company for them to afford to give a deserved pay rise... where do you think the profits are going?!!
To the big wigs in the office!! If there is not enough money in the pot then how on earth can Branson justify opening all of these new routes last year? HU?!! Kinsgston, Mauritius, etc ??? Surely they dont come cheap?!!
And what about all these lovely new aircraft? And not to mention the exsisting aircrafts being refurbished?? !! What lies!! Of course there is money he just knows that other young girls just out of school want to travel for free so they will take the low salary!! But what about those who are good at their jobs and want to stay because they like it and make a difference? They dont deserve a decent wage?? Its ok for you Mr Branson, sitting on your 5 billion that they helped you get.
Sandra, uk,
Richard a great way to put across your point... This letter would help you to have a workforce who thinks about virgin as their own baby and not just another organisation....let those guys go who want to...virgin is too big to plead to survive...
Harry, mumbai, india
I'm glad this letter of Branson's has finally shown him in
his true colours. Ttake away the waffle, of them
v us with BA, I can tell you BA, don't tolerate the sort of behaviour that allegedly goes on at Virgin, they should
be called Cowboy airlines!
Finally staff will be using the media outlets available to let you
know what really goes on at Virgin, Branson uses interesting wording "management team who (by and large) have managed"
well I can tell you how useless most of them are, and he admits as much. You onlyhave to look at Heathrow, 3 station managers in 5 years, to see they are mis-managed.
With the strike the policy has been divide/bully and conquer
the crew, but it seems to have backfired, they have lost so many good staff, the sycophants left, tell them what they want to hear about how good things are, for fear that they will be the next targets, as they are not up to the job.
Just one more point Branston always has to refer to BA to get his point across!
andrew, heathrow,
Typical management BS. Hold out to earn what your worth, do not fall for what this snake oils salesman is telling you. Your wages will not break the airline. Branson's letter isn't even factually accurate on a quite a few points. If it comes to a strike, they will come back to the table and offer you more, they will not trash a billion dollar company over a couple million a year.
Mike, The States,
Having read the sensationalist headlines 'Sir Richard Branson tells Virgin Atlantic strikers to resign' and then Richard Branson's full letter to his employees I now completely agree that Virgin staff should accept what is being offered to them. It would be foolish not to as the business clearly can't afford to offer any more.
More money and an unfriendly work environment or less money and a friendly organisation ... it's time to make up your mind guys. Who do you really want to work for?
Just remember that striking is a thing of the past ... it only hurts the organisation which in the end hurts you.
Julie, Sheffield, UK
I've had the experience of many years of working and having been with AF and living through their numerous strike actions. Please believe me when I say this as a CR person and having dealt with many many passengers during these strike actions, that no one wins. neither the staff who are left to carry the burden, nor the passengers themselves and certainly not the striking staff. All it creates is disharmony for all affected and it certainly loses an airline its credibility.
I can only urge anyone in this current situation to seriously consider the damage you will cause to yourselves, your fellow staff members and most certainly the company itself.
Lauren Gregor
Lauren Gregor, JNB, South Africa
Branson is right. The point is not how much money he has, it's what the business model can support in terms of costs. The fact that Virgin is still around despite the turmoil in the industry is testament to the fact that Virgin's got it right. And I agree: if the staff don't like it, go work somewhere else.
Jeremy, London,
It is far to easy for employees and managment who are on opposite sides of the fence, not to realise they are all working to the same ends, that end is to work as a team. This is one of the reasons why Bitish industry has failed so badly over the years, the them and us attitude. Weather your management or employee you should always remember, it's the customer that puts the food on the table and the roof over your head, the boss only handles the money. Richard may be wealthy but you should never begrudge an individual who was prepared to risk everything, any success he may have acheive in life is only the reward for that risk..
We all have to survive with the high costs of living in this day and age, but the decision as to weather you should stay with a company or not is your choice
If you don't like the pay and conditions and you feel you are worth more then leave, thats your God given right in a democracy.
Remember Richard Branson is probably one of the best bosses around.
Dave G, Kidderminster, UK
Glenn, London, UK
''The time of unions has passed, just a few dinosaurs remain.''
I believe you are incorrect about the time of unions is past. Over a period of time and a different generation coming into the labour force, unions will come back stronger.
10 years ago a green generation was unthinkable, now it is corporate reality.
Do remember the government has admitted that +50% of jobs in the last 10 years have gone to foreigners. This is a super large number of people who come from countries where unions are still strong. As time passes more will enter the UK and there views will be felt in business and politics.
You wrote:The pay level is what the market dictates.
No it is not .. it is set by a basic legal minimum wage.
This guides owners of companies as to what pay can be given. leaving or making the profit required for there pay and bonus's (or share holders dividend).
It is never market forces it is Profit, Bonus or Dividends to owners or managers
Nicholas Iles, Oswestry, United Kingdom
Scott, it's not at all true that every one has the right to strike. No one has the right to breach their contract of employment and withdraw their labour. Under UK law, if they have a recognised ballot, they can't be sued for damages. However, management can sack any worker who withdraws their labour.
In some industries, the unions are much too powerful and can bully management into over paying them. The US bankruptcy laws have allowed unions in US airlines to achieve exactly this, meaning that most US airlines would not normally be considered as viable businesses.
Branson is absolutely right when he says, if you want more money, go elsewhere. It's not as if Virgin employees are down trodden workers stuck in one small town with one narrow skill, with no alternatives open to them.
Alex, Tunbridge Wells,
I agree with Virgin and is team, I can only dream of a pay rise the last few years of 2% but no bonus as time have been getting tough for most business. If you ask for too much you will bring the company down, and drive flight prices up, and then who will want to fly, job losses and then where do you stand. I think the offer is great, I can only dream and I am sure a lot more of us do at getting that sort of pay rise in two years, that sort of pay rise is what I expec to get in ten years.
Great job to all the staff at VA, you are the best, but don't take it to far, or you will bring the company down.
Paul Andrews, Manchester,
Sir Richard is telling his staff if they don't like it, then find a job elsewhere. That's an interesting precedent he has set. If a passenger now complains to Virgin Cabin Crew, does that entitle the Crew to say "If you don't like it, fly BA"?
Anthony Bates, Hove, UK
I suggest the unions call Branson's bluff. When you go back to work every member of staff should hand in their notice. Virgin Atlantic will then have to spend time and money recruting new staff and training them. I wonder if management have factored that in to their sums probably not.
Everyone has the right to strike as a basic human freedom or shall we just go back to slavery?
Good luck to the unions - don';t belive the management or Branson its just a clear sign of desperation.
Scott, London,
I always find it amusing that when labor disputes arise, the true, honest employees are the ones identified as taking less than they think they deserve. If Richard B. wasn't so invested in letting everyone know how gloriously weathly he is, this probably would't be so offensive. How much has he given up for the cause? His letter is stupid. He is a cartoon character at this point. I hope that people ignore him.
Chris , Brewer, ME/USA
Richard love, you're making a crap load of cash, why not spread it around. I run a business also, but my people are everything and although Virgin is this and that better culture than BA bla bla bla, in the end it comes down to the cash baby, cash is king. You can only brain wash young people for so long before they end up leaving your company. By that time though, you'll have fresh meat and so the process continues.
Anna H, LA, USA
No one should be able to strike for pay, end of story.
If you do not like what you are being paid then do what most every non-union worker does, put yourself in the job market and find another one that suits you better. Relying on a self-serving union to keep staffing levels and wages high often only ends in the company you are working for failing and you having to find another job anyway.
In today's world with a flexible workplace, meritocratic society, free education (to a level) and widespread geographical mobility anyone should be able to find and hold down a job. The pay level is what the market dictates. The time of unions has passed, just a few dinosaurs remain.
Glenn, London, UK
management salary.
employee salary.
equal sacrifice, equal reward, equal success.
period.
William Young, Los Angeles, USA/CA
I suppose thats one way of negosiating a pay rise, he forgot to mention whilst everyone was being proud and hardworking,he was coining it in.
tony, wigan,
Contrary to the American sheep-people who don't know how much corporate welfare DC provides for their Airlines ALL of the major international US Airlines have received tax-breaks, protectionist trade laws in their favor and any form of outright government bail-out that congress could sneak past regulations. Companies that can't rely on this kind of favoritism need to be more brutally honest.
It's worth noting that it's easy for a creative and well managed company to get past this kind of protectionism, just as Toyota managed to outsell the inferior American junk of GM and Ford even with the US government deliberately trying to impede them in the market.
Martin, Bristol, UK
the real data we need to see is if the managment pay is equally below that of the legacy carriers.
what is good for the geese is good for the gander
roy, moorestown, nj
I believe VA has long used it's chairman's charm to woo its staff into accepting lower wages in the industry. VA also had a regional airline that it merged with/sold to SN Brussels since it could not turn a profit. If VA looks at this as a business decision then so should its staff - this is a business decision for them and if it means sticking together and taking action to get better wages, then so be it. In the end the loss will be greater for VA then its staff and the longer any industrial action ensues the more the damage to VA and hence VA will bend to respectfully pay its staff what they deserve. VA is losing and some may argue that it already has lost its magic and this will add another negative stigma to that slide.
Ari Wallenheim, New York, USA
Simply wrong about Continental, Delta, Northwest and United. None of them received govt loans.
enplaned, Las Vegas, Nevada, USA
Sir Branson's analysis of the situation makes sense-In any viable business environment the expenses must never exceed the profits .Virgin can only offer what it can and still stay afloat.It will be wise for those seeking more to find alternative packages elsewhere.Many people are jobless and their exit will pave way for those currently unemployed.Dont get me wrong when i say this-i dont mean that they should not fight for better pay-But it good to study the situation and then decide.If i am not wrong-even the union recommended the package offered by the Virgin Team.Take it or lose it.
Jack Shaka
MBA Student.
Jack Shaka, Berlin, Germany