The labor setup is key to an elaborate cost-cutting strategy that Mr. O’Leary pioneered in the mid-1990s, when the European air travel market was liberalized. Until then, big national carriers like Alitalia, Air France and Lufthansa had commanded the Continent, with a corps of unionized pilots.
Mr. O’Leary followed the low-cost model of Southwest Airlines in Dallas, now the world’s biggest airline in terms of passengers. Southwest had minimized operating costs and lured fliers from legacy carriers by offering cheap, bare-bones flights.
He honed the approach for Ryanair, putting hubs in inexpensive European locales that generated new tourism and jobs. Fuel costs were rigorously managed, and turnaround times for flights squeezed to the fastest in the industry. The company uses only Boeing jets to reduce engineering costs, and leases part of its fleet to recoup tax write-offs. And it avoided unionization, a strategy that some low-cost European rivals have copied, along with Ryanair’s tactic of using contract pilots to cut costs.
Mr. O’Leary cultivated a brash image, poking competitors, pilots and Ryanair’s own customers. At the shareholders meeting, he angered pilots by saying they had an “easy job.” He once proposed charging passengers to use the toilet, and placing higher fares on “fat people.”
None of that happened. But Ryanair’s ticket prices — as low as €10 from London to Rome — were a game changer. Ryanair is now Europe’s biggest carrier, and the fifth largest in the world, with 117 million passengers in 2016. Profits tripled over the past decade to €1 billion and remain robust even after Ryanair refunded €25 million to 700,000 passengers recently for the cancellations.
Ryanair is also a fast-track opportunity for young pilots and crew members to accumulate experience and jump to another airline. Those promoted to captain can earn a six-figure salary on a full-time contract.
But employees were often blindsided by the labor setup once they were inside, according to the current and former Ryanair pilots and crew members.
Thousands of new Ryanair pilots went through the same process as Mr. Van Boekel. Some were required to form limited liability companies in several countries with pilots they didn’t know.
As contractors, they didn’t receive standard benefits for pensions or health insurance. Pilots and flight attendants on Ryanair’s Irish contracts weren’t always protected by labor laws in the countries where they worked. Ryanair said its contracts complied with labor laws in Ireland and the European Union.
Pay has been another concern. Self-employed pilots and aircrew members are paid only for hours flown, but not for time spent preparing for a flight, or when they are delayed or canceled. Minimum monthly work hours were promised though not guaranteed.
Contractor pilots paid their own transportation and costly hotel bills when assigned to fly from different airports. Like flight crews, they shelled out for uniforms, food and even drinking water on flights. Ryanair’s go-to employment agencies required job seekers to pay for qualification training, starting at around €2,500 for flight attendants and about €30,000 for pilots.
When tax authorities raided Ryanair’s German sites as part of their investigation into alleged tax evasion by Brookfield Aviation, they also questioned pilots who had signed contracts with Brookfield. That set off a mild panic among Ryanair pilots elsewhere in Europe with the same contracts.
Pilots, in interviews, said they felt discouraged from raising workplace concerns, which could lead to being called into Dublin for tense meetings with managers. Others recounted being pressured to limit their fuel consumption and fearful of being reprimanded if they complained of fatigue. Flight attendants reported coming to work ill and scrambling to fulfill sales quotas on flights for lottery cards, perfumes and other items to avoid rebuke by managers.
One former pilot recalled protesting after being told to pay for a costly taxi ride to another airport to fill in for a colleague. Managers suggested he could be demoted if he didn’t comply. It created a culture of fear, he said.
Robin Kiely, Ryanair’s spokesman, said that claims of workplace pressures were “false and invented,” fomented by unions seeking to undermine Ryanair. “There is no pressure on people here,” he said. “We certainly work hard, but we work smart.”
Mr. Kiely said employees enjoyed favorable conditions and unmatched job security. “We have 13,000 employees,” he said. “If it was so bad, they wouldn’t be working here.”
Ryanair employees have made various attempts to unionize. Each time, the effort has been rebuffed.
James Atkinson, a pilot who flew with Ryanair for eight years, said that when he started in Rome in 2006, the company pressured crew members who tried to organize.
People who participated in those organizing efforts were reassigned to other airports outside of Italy where Ryanair operates. Those who refused to relocate were fired; others eventually retracted their demands, he said.
Later, Mr. Atkinson created his own website to try to organize Ryanair employees. Soon after, he said, Brookfield declined to renew his contract. Today he is a pilot at a rapidly expanding airline in China.
In 2011, Belgium-based Ryanair flight attendants on Irish contracts sued for the right to claim Belgian pay and entitlements in the nation’s courts. Ryanair had claimed that disputes involving Irish contracts could be heard only in Ireland, where benefits like unemployment insurance and social security were less favorable than in Belgium.
One attendant, Virginie Mauguit, approached a local union for advice. She distributed union leaflets to crew members describing their rights under Belgian labor law. Two weeks later, Ms. Mauguit said, she was fired.
“People don’t have the right to complain,” she said. “It was dangerous for your job.”
The European Court of Justice ultimately ruled in September that aircrew could pursue their rights in the country where they work.
Mr. O’Leary declared victory because the court didn’t bar Ryanair from continuing to issue Irish contracts. But in his letter to employees, he said Ryanair might close gaps in benefits between Irish contracts and local labor laws.
The autumn scheduling breakdown brought the issue to the forefront again, hitting not only morale but also the corporate suite.
Amid the tumult, Ryanair dropped a bid to buy the ailing airline Alitalia. Mr. O’Leary hired a former top executive to address the turmoil, started a recruitment drive and warned pilots about “misinformation” from competitors’ unions. A message sent to former pilots to try to hire them back said Ryanair was working to “significantly transform and reward the way we interact with our pilots.”
Staff members at Ryanair have continued to fight back, calling on Mr. O’Leary to change the contractor model and improve working conditions. Growing numbers are pressing Ryanair to conduct collective bargaining and recognize a Europe-wide management committee that they organized, rather than negotiate through managers at each Ryanair site.
Pilots in London and in Madrid recently revolted against an offer for pay increases on the condition that they agree to continue negotiating with Ryanair directly. Many are now trying to spread the message more widely via WhatsApp and Facebook.
“Pilots have said enough is enough: we like this company but we don’t accept the terms and conditions any more,” said Dirk Polloczek, president of the European Cockpit Association, representing more than 38,000 pilots across Europe.
“They think Ryanair can be a good employer,” he added. “All they have to do is have a dialogue with their pilots.”