One of budget carrier Wizz Air’s investors has opted to sell its shareholding, citing the airline’s policy of refusing to recognise employee unions.
The Danish pension fund AkademikerPension says it is selling DKr22 million ($3.4 million) of shares.
Its director, Jens Munch Holst, says the investor has held discussions with Wizz Air’s management, but not received any indication that its policy will change.
“We see no other way than to exclude the company [from our investments],” he says, adding that investors must be prepared to use such measures to influence companies. “Exclusion is the last tool in our toolbox.”
It claims Wizz has refused to engage in collective bargaining with employees in several countries, and that its behaviour is “in conflict” with labour rights.
“The risk of being linked to a clear and persistent breach of our responsible investment policy is simply too high if we remain invested,” argues Holst.
The airline has previously been criticised over its union position by the European Transport Workers’ Federation, notably after chief executive Jozsef Varadi, in a June 2020 interview with Swiss publication AeroTelegraph, was quoted as saying that unions were “killing the business” – and that Wizz Air’s response to unionisation was to use its flexibility to close bases and “move on”.
AkademikerPension has similarly referred to this comment in laying out its decision.
It adds that, prior to its decision to withdraw from Wizz Air, it contacted the airline together with another investor, Ardevora Asset Management, to request immediate changes to Wizz Air’s approach to employees.
Ardevora Asset Management confirms it delivered a letter to the company, signed by 14 investors, in October last year.
“Although we are no longer invested in the company, we have supported our industry peer, AkademikerPension, in preparing a public statement and securing a meeting with the company in January 2022,” it adds.
Wizz Air insists it is fostering a “strong community” in which “we all support the same culture and values”.
“We consider our employees to be our biggest asset, which is why we have worked tirelessly over the last 18 months to preserve the jobs of over 5,000 colleagues, and to provide them with countless opportunities within our network to develop their careers,” it adds, pointing out that it has been rehiring many of the personnel it was forced to shed during the pandemic.
The airline states that it has restored salaries for all cabin crew and pilots to pre-crisis levels, and that it remains committed to supporting staff and creating new opportunities.
“Wizz Air takes the engagement with its employees very seriously and we are confident that our structures and processes that have been in place to support open and transparent engagement are working extremely well,” it says.
These processes include the company’s ‘People Council’ and ‘Floor Talks’ initiatives which, it says, offer a forum for employees to discuss important issues and enter two-way dialogue with the company’s chief executive.
“Additionally, we recently formed a ‘Sustainability and Culture’ committee for the board all with a view to dedicating even more focus on environment and people issues,” it adds.