EADS breaks layoff taboo in plan to cut 5,800 jobs
By Tim Hepher
PARIS (Reuters) - Airbus parent EADS EAD.PA risked a collision with unions and European politicians by unveiling plans to cut 5,800 mainly defense and space jobs that for a first time include significant forced redundancies, driven by weak European budgets.
Breaking a taboo on forced job cuts throughout most of its 13-year history, the aerospace group said 1,500 people would be found new posts and some would not see temporary contracts renewed, but 1,000-1,450 people could not be spared redundancy.
Chief Executive Tom Enders, who has pledged to run EADS as a normal company after a shake-up of French and German state shareholdings earlier this year, told unions that EADS had to be competitive or face worse turmoil as pressures increase.
"We need to act now, we cannot sit idle," he told an internal union meeting, according to a person who was present.
"Inaction would be irresponsible and would result in a much more severe situation for our employees and the performance of our company a few years down the road," he added.
The cutbacks coincide with plans to merge the company's defense and space divisions into one unit combining its share of Eurofighter combat jets and Ariane space rockets as EADS becomes the latest defense firm to respond to weak orders.
One of France's leading unions, Force Ouvriere, pre-pempted the announcement by disclosing the jobs news immediately following Enders' briefing to the EADS works council and vowed to used "any initiative" to resist compulsory redundancies.
German union IG Metall also criticized the plans but noted they were still subject to further negotiations. Continued...