Norwegian Finance Minister Sigbjørn Johnsen says he will demand that employees of Irish low-fare airline Ryanair who are based in Norway must pay taxes to Norway and not to Ireland. The demand comes just as Norway’s national pilots’ organisation is demanding an audit of the airline, and as the national heart and lung association was urging a boycott.
The pilot’s organization (Norsk Flygerforbund) claimed over the weekend that it’s been trying to clarify which state authorities are responsible for working conditions at Ryanair for the past two years. “We’ve seen the development of ‘management by fear’ at the airline,” Aleksander Wasland of the pilots’ association told newspaper Dagsavisen. “We think the ministries have chosen to avoid dealing with this.”
His group represents 1,500 pilots in Norway and he fears the spread of Ryanair’s business model to other airlines. Norwegian Air is also setting up bases in other countries and hiring cheaper, lower-paid employees through crewing agencies to work on board the aircraft. It expects employees to pay tax, though, to their countries of residence, not Norway, unlike Ryanair which claims only Irish tax law and regulations apply to its crews.
The pilots’ concerns come as Norway’s national heart and lung association (Landsforeningen for hjerte- og lungesyke, LHL), was claiming that overworked and underpaid cabin crews pose a security risk. It planned to send an e-mail to all its 45,000 members and more than 650 employees this week advising them to boycott Ryanair. The airline has been making headlines for the past week after two of its Norwegian-based flight attendants sued Ryanair for what they claimed were unwarranted dismissals. The flight attendants also shared their contracts with one of Norway’s major labour federations, revealing low pay and working conditions that prompted union officials to call them “slave contracts.”
Ryanair has a solid record of safety, with among the best safety statistics in Europe. LHL leader Frode Jahren nonetheless stressed that if cabin crews are exhausted, unhappy and may not even have been able to afford to buy enough food, it can affect their performance in the air. “Working conditions and health are connected,” Jahren told newspaper Dagsavisen on Monday. “When a Ryanair employee sends a letter to Norwegian authorities saying that Ryanair employees lack food, and work under contracts that provide no paid sick leave, those are examples of what does not promote good health and safety.”
LHL was encouraging other patient organizations in Norway and health care institutions to join the boycott. Several other organizations have also advised against flying with Ryanair, while one Member of Parliament, Bjørnar Moxnes of the Reds party, demanded that all of Ryanair’s aircraft be grounded before a serious accident occurs. With less than 2 percent of voter support, though, it was unlikely Moxnes’ demand would get much backing.
‘Must pay tax in Norway’
Meanwhile, Norway’s finance minister Johnsen from the Labour Party says Ryanair boss Michael O’Leary is wrong in claiming that Ryanair cabin crews in Norway must pay tax to Ireland because they work on board Irish-registered aircraft. Johnsen told Norwegian Broadcasting (NRK) on Monday that if they live in Norway for more than 183 days a year, then they must pay tax to Norway and in turn be eligible for Norway’s social welfare benefits.
Johnsen told NRK that Ryanair employees may be hit with back taxes but will also get Norwegian rights and pension credits.
O’Leary continues to argue that Irish law applies to Ryanair’s employees, in accordance with EU rules. He has pointed out to NRK that Norway used a similar argument in demanding that Norwegian seafarers on Norwegian-registered ships also had to pay tax to Norway no matter where the ships were in the world. Ryanair employees are mostly compensated for the hours they spend in the air, with little if any pay when they are on the ground or on standby.
Some observers have predicted that Ryanair will shut down its Norwegian base if forced to pay Norway’s higher labour costs, but Espen Andersen, an assistant professor at Norwegian Business School BI wasn’t so sure. “Norway is more expensive than many other countries, but we also fly a lot,” Andersen told NRK. He thinks O’Leary will decide it’s worth continuing to run flights to and from Norway, even if forced to raise workers’ pay and fares.
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