Low Cost Airlines:: Business Model and Employment Relations

The passenger air travel industry is experiencing increasing competition between low cost/no frills carriers (LCC) and the more traditional full service carriers. This paper explores the comparative business models with a view to identifying areas where these might be expected to generate different HR and employment relations practices, and checking the findings against available evidence. While some of the expectations are confirmed, unionisation is higher than anticipated in the LCC sector and a relatively high percentage of staff were on regular rather than contingent contracts. Differences in approach are observed among LCC airlines, and the evidence indicates some convergence between the two sectors as competition heightens.