Corporate responsibility and how we operate underpins our long-term prospects and our future financial performance. Safety, customer satisfaction, people and the environment all matter to our business.
Safety is our No.1 priority and a clear imperative for every airline, including easyJet. We recognise the risks associated with operating an airline and work tirelessly to ensure the safety of our customers, our people and our shareholders’ investments.
At easyJet we believe people make the difference; by treating our people well, they will be more customer-focused and better represent the easyJet brand – and that in turn will drive greater customer satisfaction.
In order for aviation to have a long-term future, we must minimise our environmental impact, ensure that environmental impacts and the evolving regulatory environment are considered in all key business decisions and continue to invest in a fleet of young and fuel-efficient aircraft.
Safety and our customer proposition are key strategic priorities and are covered in detail here and here of this publication and therefore this Corporate Responsibility report focuses on our approach to people and environmental management.
Our business is only as good as the people that we recruit, train and retain. Our people strategy is underpinned by the cornerstones of talent, engagement and organisational design and aims to ensure that, through strong leadership, we have the right skills in the right place at the right time, thereby creating an environment where people perform better for us than they would for anyone else. We recognise that having the right skills, experience and culture directly influences our performance across all of our strategic objectives. Our ethos is expressed through five values: safety (our No.1 priority – no compromises), teamwork (we’ll get there faster together), pioneering (breaking the mould to find new ways and new opportunities), passionate (we’re ambitious to be the best we can be) and integrity (we mean what we say, and do it!).
Our employer brand remains a key strength – we received over 45,000 hits on our website for opportunities which resulted in over 20,000 applications; the quality of these applications was high and continues to ensure that we have buoyant holding pools from which to source our future employees.
We continue to focus on recruiting crew that live and breathe our values and have, for the past few years, changed the emphasis of our employment model to match the seasonal peaks of our business. We recruited 672 cabin crew in the year; our strategy to employ on fixed term contracts and invite people back year after year enables us to manage our business flexibly whilst maintaining our high standard of operation. We also operated the Flexicrew scheme for our pilot requirements, employing 92 pilots across seven bases for fixed periods of time, to meet our operational needs.
Following the consolidation of easyTech and GB into the easyJet engineering and maintenance function, our focus has been on integration and building talent for our future growth. We have recruited 28 people into the function this year following the in-sourcing of several activities previously undertaken by a third party supplier. This exercise has enabled us to manage the safety, oversight, availability and reliability of the ever growing fleet. This has been another positive step forward in ensuring a world-class operation and a fully integrated engineering and maintenance function.
A wide variety of people joined easyJet through the year. We have looked to continuously improve our well-established and thorough induction training programme for crew and are in the process of refreshing our offering for those within the Management and Administration (M&A) population. This will ensure that all of our new joiners understand the easyJet culture, what we value, our strategic objectives and how they can contribute to our success from day one. easyJet wants people who are new to the organisation to settle in as quickly and efficiently as possible and will continue to invest in the induction process for everyone’s benefit.
We continue to partner with leading schools such as Cranfield University and London City University to ensure our managers get high quality support in developing both their technical and management skills. We continue to build and maintain good relationships with well regarded research and advisory organisations and many of our senior managers continue to represent easyJet at numerous external events hosted by these leading organisations.
easyJet targets a sensible balance of retention and attrition, benefiting from our investment in recruitment and training, combined with continual injection of fresh thinking. Retention rates are influenced by rewards (including pay, benefits and career development opportunities) and employee engagement.
We recognise that it is often beneficial to the business to identify and develop talent internally together with recruiting externally. Four years ago, we developed our talent identification and succession planning process, which is now embedded in our organisation. As a result, we are more effective at identifying and retaining a pool of talent internally on which we can draw as key roles become vacant or new roles are created. Consequently, whilst we have experienced higher than normal turnover among senior managers this year, we have been able to source some replacements from within our talent pool whilst also taking the opportunity to refresh our talent mix from outside. Overall unforced staff turnover has improved by 5.1 percentage points to 6.9% since 2008, although understandably, the tough economic environment may have also significantly influenced employees’ decision to stay at easyJet.
In line with our quest to “Turn Europe Orange” we have made significant progress in expanding our employer presence across Europe. In 2009, easyJet continued to grow its employee base in Italy, Spain and France, strengthening our position as a truly pan-European air transport network.
As at 30 September 2009, easyJet employed 6,666 people (2008: 6,107), based throughout Europe as illustrated below:
easyJet is an equal opportunities employer. We ensure that our employees and applicants do not receive less favourable treatment on the basis of their age, colour, creed, disability, full or part time status, gender, marital status, nationality or ethnic origin, race, religion or sexual orientation. Applications from disabled employees are always fully considered, bearing in mind the aptitudes of the applicant concerned. In the event that one of our people becomes disabled every effort is made to ensure that their employment at easyJet continues and training is arranged where appropriate.
easyJet offers a competitive rewards package and reviews salaries annually in line with market rates to ensure continued alignment to the market. The rewards package includes an annual performance-driven bonus, based on personal and Company performance, which encourages all employees to contribute towards achieving our strategic objectives. Employees are also eligible to participate in a Group personal pension towards which easyJet contributes, as well as having the option to make their own contributions through salary sacrifice.
easyJet once again offered all employees the opportunity to join its popular all-employee share plan, easyJet Shares 4 Me. The plan has won five major awards to date, and involves three elements: Save As You Earn (SAYE); Buy As You Earn (BAYE) and Free Shares. Each scheme is Her Majesty’s Revenue & Customs (HMRC) approved and is open to all employees on the UK payroll. For employees who are on non-UK payrolls, international schemes have been established with similar terms and conditions to the UK scheme, albeit without the UK tax benefits. Participation in the scheme remains very strong, with over 80% of eligible staff now taking part in one or more of the plans.
In January 2009, we introduced “Your Benefits” to UK staff. This enables employees to access programmes and savings which would not be available to them on an individual basis. The benefit choices for 2009 included car breakdown cover, childcare vouchers, a “cycle to work” scheme, dental and optical insurance, Give As You Earn, health screening, income protection insurance, life assurance and private medical insurance. There are also “lifestyle” products which offer discounts on a wide range of products and services.
Employees make further savings in tax and National Insurance for many of these benefits, through salary sacrifice. easyJet’s National Insurance savings contribute to the financing of the scheme, which is fully outsourced.
Discounted staff travel continues to be a popular benefit available to all easyJet employees. Unlimited staff travel on the entire easyJet network is available for easyJet employees, their dependants and up to three nominated companions, subject to availability. easyJet employees made 73,461 bookings using staff travel during the year, a total of 126,562 seats flown. The most popular route purchased by our employees was the London Gatwick to Malaga route.
easyJet is committed to ensuring high employee satisfaction and engagement levels across its business. Engaged and motivated employees are a critical enabler for us to deliver on all of our strategic objectives, for example by identifying ways that we can improve our customer proposition, decrease our cost base, and, operate safely at all times.
One way in which we achieve these high levels of employee advocacy and engagement is our ability to underpin our cultural values in how we work with our people through informing and consulting with them. Our flat management structure enables us to communicate directly with all our employees. A number of communication forums are also in place; in addition, easyJet is currently establishing a European works council called the easyJet European Forum. This representative group provides a communication vehicle for information and consultation at a European level for issues that affect employees in more than one country. The aim of this forum is threefold: to assist in sharing best practice and communication across the business, to raise awareness and understanding of European-wide issues and how they affect us, and to inform us on what we can do to ensure we remain successful and true to our principle of low cost.
We work with our employee representatives and recognise a number of trade unions across Europe. easyJet has not lost any days due to industrial action during the year. In addition, we have joint working groups actively engaged in improving productivity in lifestyle related matters for our crew; activities which are consistent with our brand promise and cultural values. We survey opinion directly with all our crew members to take “temperature checks” on how we are progressing and how their needs are changing.
We monitor and identify ways to improve employee satisfaction through our annual Pulse survey, which all employees are encouraged to participate in. This year, only 36% of employees participated in Pulse – a disappointing response rate which we believe may be due to our crew’s perception that management would be unlikely to put any suggestions into effect because of the difficult economic environment. Of those that did respond to the survey, however, 66% of our people indicated they are either satisfied or very satisfied, with high levels of both employer and service advocacy helping us to deliver our customer proposition. Summarised Pulse results are shown below:
|Great place to work||60%||69%||(9)ppt|
The executive management team expected that the Pulse results would decline in 2009 because of the unprecedented economic uncertainty and significant pressure to reduce costs. However, easyJet is focused on addressing any concerns identified and, to this end, has made a commitment to make a step change improvement in communication processes and resource across the business. In particular, there is a plan to re-energise the base sponsorship programme around the network for all members of the easyJet leadership team. This will improve the understanding between people based in the network and those based in the central office at Hangar 89.
During the year, we have continued to promote our values with our “Going the Extra Mile” employee award programme. These awards are designed to recognise employees who go beyond what can rightly be expected of them in their role in order to deliver business success. During the year, our people have been submitting nominations linked to our customer proposition and values, together with revenue generation and cost reduction recommendations.
Successful nominations by customer proposition
Successful nominations by easyJet value
easyJet strives to ensure that our recognition programmes continue to align employee contribution with business results and, to that end, the award programme will be revised during 2010.
Our charity policy is to recognise and devote efforts to a single charity each year. This year, our chosen charity was The Anthony Nolan Trust.
easyJet has worked with The Anthony Nolan Trust to help promote the charity, with activities including onboard collections, a “click and give” campaign from our website, fundraising activities initiated by our people, a feature in the inflight magazine and other public relations activities. £50,000 was donated to The Anthony Nolan Trust by easyJet as a corporate donation.
easyJet does not make any donations to any political party. This in not in line with our values and would be deemed as inappropriate.
easyJet employees are sometimes sent gifts from various companies throughout the year. In order to provide clear guidance to employees and avoid potential conflicts of interest, we have a strict policy that prevents any employee accepting gifts over a nominal value of £35. Every Christmas (and less frequently, at various times through the year) easyJet holds a staff raffle of all the gifts that are received. Every employee across Europe is entered into the draw and allocated a unique reference number. Numbers are then drawn at random and winners have the gifts sent directly to their home.
Environmental issues are important to all of us, and we are committed to ensuring that both easyJet, and the industry as a whole, play our part in meeting our environmental responsibilities. Everyone at easyJet helps deliver on our environmental commitments, from the cabin crew who collect waste for recycling to the senior management working with politicians on climate change and manufacturers to push for next generation aircraft.
Aviation contributes to climate change. The long-term predominant effect is from carbon dioxide (CO2) emissions, of which aviation contributes around 3% of man-made CO2 emissions. The overriding environmental issue is tackling climate change.
The target for the industry must be to reduce its emissions over time, and we welcome the UK Government’s endorsement of this approach when it set industry emissions targets last year. The industry faces significant challenges; unlike many other sectors, there are no carbon free solutions on the horizon, and its high profile may put it at significant risk of punitive measures. This is why we have been at the forefront of efforts to put aviation into the EU Emissions Trading Scheme (ETS), a framework for reducing EU emissions, and driving the development of next generation aircraft. Taking responsible steps is not only the right thing to do, but it also limits the risk of unreasonable measures being imposed on the aviation industry. We are pleased to report that aviation’s entry into EU ETS is now definite. We took a lead role in this work, and we are now working to ensure that easyJet is ready for formal entry in 2012. Entry into EU ETS carries both risks and opportunities. However, we believe that due to our efficiency, we are well placed relative to competitors.
Our focus on efficiency is central to delivering our environmental commitments, and means we are significantly more environmentally efficient than most other airlines. Over time this will also give us a competitive advantage, as environmentally inefficient flying will become increasingly unsustainable.
The most significant effect of the emissions of mono-nitrogen oxides (NOx) from aviation are currently considered to be on local air quality around airports. All of our aircraft deliveries since February 2008 have been fitted with the new CFM56 “Tech Insertion” engines that reduce NOx emissions by 25% due to better combustion processes – almost a quarter of our fleet are now fitted with these more environmentally efficient engines which are also expected to deliver a 1% improvement in CO2 emissions.
At the airports we operate from, we also have a local impact on the environment in the form of noise. However, our business model ensures that the impact of this on the local environment is less than for many other carriers. Our new aircraft are amongst the quietest in the industry and we have very few operations at night (2300 hrs – 0600 hrs) when noise is of the greatest concern. All of the aircraft in our fleet are compliant with the latest required international noise standards, known as “Chapter 3”, but also with the latest more stringent standard, known as “Chapter 4”.
The overwhelming majority of our greenhouse gas emissions come from flying (we estimate less than 1% of our emissions are non-flying related), and it is these emissions which we report on and focus our efforts on reducing. We are working to be as efficient as possible, in particular by flying new, highly efficient aircraft, using our aircraft as efficiently as possible, continually focusing on reducing the emissions from each flight and working to improve the efficiency of the airspace we fly in. Due to this, we are the most efficient airline on a significant majority of the routes we fly.
Our policy is to expand our fleet through the acquisition of the latest technology aircraft, as these are more fuel efficient than older models. Our average fleet age is 3.5 years, broadly flat compared to last year. We also use these aircraft as efficiently as possible, by maximising load factors and seating density (see “The easyJet efficiency advantage”, below).
All aspects of our business model are designed around safety and efficiency. This focus on efficiency minimises the environmental impact of each passenger flight. Our network development has generally focused on substituting services in markets dominated by inefficient former state-owned airlines with our more efficient product – 80% of our capacity is deployed in established markets. While we aim to grow these markets through our low fares, when we enter a market we often substitute for existing less efficient services. The efficiency that we bring to a market can even result an overall reduction in emissions in absolute terms, even if total passenger numbers increase.
Alongside our operating model we work every day on improving the efficiency of our flying, and in the last year implemented a number of fuel saving initiatives (see here for more detail). Finally, by pushing for more efficient airspace use, such as Continuous Decent Approaches, we are demanding that our service providers match our level of commitment.
Taking these together we have set a target to reduce our CO2 emissions per passenger Km by 3% by 2011.
g CO2/passenger Km
An easyJet passenger is responsible for 22% fewer emissions than a passenger on a traditional airline to the same destination and using the same plane
Note 1: Source: Airbus.
Note 2: Source: AEA for January–August 2009.
During the year, efficiency improvements have led to a significant reduction in emissions intensity. In particular:
During the last nine years our emissions of CO2 per passenger kilometre have reduced by 25%.
easyJet believes that emissions from aviation will need to fall in the long-term, but that achieving this will require the industry and governments to work together. It will require step changes in efficiency, through new technologies, and the right policies from governments.
We continue to actively engage with both airframe and engine manufacturers in pursuit of this vision by 2017, further developing the vision we outlined in 2007 – the easyJet ecoJet. We have set out a platform for an aircraft that is 25% quieter, emitting 50% less CO2 and 75% less NOx per passenger Km than today’s aircraft.
We support efforts to include emissions from international transport into a post-Kyoto climate change agreement, and along with the business leaders of over 500 global companies, we have signed the Copenhagen Communiqué on Climate Change. We are committed to working with policy makers across Europe to help shape future policies. In addition to our work on ETS, we are working to improve the efficiency of airspace and are involved in the SESAR (Single European Sky ATM Research) programme, part of the implementation of the EU’s Single European Sky (SES), which aims to reduce emissions by at least 10% across Europe.
Alongside this we are involved in a range of bodies, including the Sustainable Aviation group in the UK. We also answered the Carbon Disclosure Project Greenhouse Gas Emissions Questionnaire as part of the latest Carbon Disclosure Project (CDP7).
Crucially, we believe it is important that consumers are given full and accurate information on the carbon impact of their flight. We have provided a carbon calculator on our website, and consumers are informed of the emissions they are responsible for as they book and are given the opportunity to offset the carbon emissions of their flights as part of the booking process. Our offset scheme only uses United Nations certified carbon credits.