Contrasting Management and Employment-Relations Strategies in European Airlines

Abstract

We discuss deregulation (liberalization) and some of the international institutions that influence the management of people in airlines. As a point of departure, we summarize contrasting models from successful ‘new entrant’ airlines: Ryanair and Southwest. We consider examples of various categories of airlines in different ‘ideal types’ of institutional context: liberal-market economies and coordinated-market economies. These are two varieties of advanced capitalism. The former include the USA, Britain, Ireland (and Australia). The latter include the Germanic and Scandinavian countries. We classify airlines according to which strategies dominate their efforts at cost reduction. Alongside these differences in strategies, we analyse differences in two aspects of employment-relations strategies. First, employers can focus on controlling employee behaviour or seeking their commitment to the goals of the airline. Second, employers can seek to avoid, accommodate or partner with unions. We show that, in terms of employment relations, the variety of capitalism context helps to influence employers’ strategies, but airlines (and other enterprises) still have some scope for exercising strategic choice, in spite of their institutional and regulatory context.