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Financial Proposal

Eagle Airlines is a low-cost carrier airline company operating across Europe. The company was founded in 1978 and has grown to become one of the major players in the European airlines market. The company’s low fares and point-to-point destinations has endeared it among most European air passengers. However, the company is facing a growing concern over reduced output from employees. The management authorised an inquiry into what could be causing this problem, and it was found that employee absenteeism and lack of focus were the main causes. Solutions to the abovementioned problems were sought and are described in details in the following parts.


From the results of the study on poor employee output, it was found that apart from absenteeism, an employee who does not focus on their job because of other pressing issues is likely to perform poorly. Some of the issues that can make an employee get distracted from their duty include parental duties, meals and other family obligations (Staniland 2008). Because of its volatile nature, the airline industry is perhaps among the most sensitive in regard to the quality of output from employees (Alessandro 2008). To address the issue, Eagle Airlines has come up with a plan to establish some on-site services to enable employees spend more time at their workplace. These on-site services include: day care centres, meal facilities, teleconferencing, healthcare centres, recreational and leisure facilities.


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The issue of employee absenteeism and substandard output at work is a major problem in many business entities. This is especially evident in the service industry where employees have direct contact with clients. In the airline industry, hospitality to passengers is a major factor in winning and maintaining their loyalty (Lashley et al. 2007). This proposal suggests introduction of some services that can improve employee performance and reduce time wastage.

For optimal output at the workplace, an employee needs to feel valued and cared for (Dworaczek 1984). Although most employers may believe that wages are the primary concern for employees, studies have shown that other factors such as the working environment, an employee’s attitude towards job and his or her psychological well-being play significant role in determining the performance. The emotional and psychological well-being of a person is achieved when they have met their primary goals. These goals include meeting the needs of their families and gaining personal satisfaction. The employer can make employees feel valued by making an effort to help them meet some of these goals easily. This in turn will make them spend more time and energy in carrying out their duties at work.

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The Problem

Absenteeism and time wastage, coupled with poor quality services due to employee stress translates to millions of dollars in losses. According to Schmidt (2008), apart from the time lost in absenteeism or lateness, lack of motivation is another factor for reduced output. Absenteeism and/or lateness occurs when an employee has physiological or psychological disorders, spends their working time to attend to other duties such as taking care of children or meeting personal needs.


The management at Eagle Airlines plans to overcome some of these problems by introducing some essential services aimed at making employees focus more on their duties and responsibilities at work. Even though they may be costly at first, their long-term benefits far outweigh the initial expenses.

One of them is provision of day care services to employees’ children. This will ensure that employees do not worry about the well-being of their children and therefore concentrate more on work. Another measure is the introduction of teleconferencing facilities to help minimize the amount of time spent on organising and hosting meetings. Provision of healthcare services at the place of work will also help to take care of some minor medical issues that would have otherwise required employees to travel some distance to get them. Additionally, o-site meal facilities will ensure that employees do not waste much time during meal hours. Finally, provision of recreation and leisure facilities can help employees relieve pressure accumulated from carrying out their duties at work. The services are discussed in detail below.

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Day care Services

A quick survey in most business entities is likely to yield results that most employees are in some form of parenthood. Workforce in the airline industry is no exception, in the recent past, it has undergone major transformation; most employees are in either two or single parenthood. Programs for Parents, Inc. (2011) cite the US Bureau of Labor’s statistics with information that over 10 million people in the workforce are single parents while 2.1 million of them are single fathers. Approximately 65 per cent of women in the workforce have children aged below six years (Programs for Parents, Inc. 2011).

It has also been observed that in coming years, the number of women in the workforce will be more that of men (Williams 2010). This means that a lot of potential working time will be lost since it is mostly the mothers who take an active role in raising children during their early days. Other than the time lost on absenteeism, productivity is also likely to decline. This is because working in the airline industry requires a lot of physical and emotional output. Therefore, parents who are striving to balance work and childcare are likely to be stressed.

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To avert the problem of employee absenteeism and reduced or poor quality output, Eagle Airlines plans to offer day care services for its employees’ children. This will most likely improve employees’ workplace reporting and increased performance; resulting in increased revenues. The quality of service offered by employees is likely to go up, attracting more clients and gaining loyalty from existing customers. To quote Programs for Parents, Inc.,”54% of employers report that child care services had a positive impact on employee absenteeism, reducing missed workdays by as much as 20%-30%” (2000, p. 1).

Other ways, in which the management of Eagle Airlines will get involved in their employees’ child care, include holding seminars to inform parents on available child care resources and how they can be utilized. The company can also intend to develop leave policies such as job sharing and part-time programs so as to undercut the time lost due to absenteeism or reduced output. Employers can also partner with other like-minded companies to set up near-site child care centres to cater for their employees’ needs.

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According to CCH Incorporated (2012), employers can also greatly benefit from on-site childcare facilities in the following ways:

  • Increased ability to attract clients.
  • Reduced cases of absenteeism.
  • Improved attitude towards their work and the company.
  • Reduced turnover rates.
  • Improved relations with the immediate community.
  • Increased output at work.

On-site Healthcare Services

Sometimes employees may require medical attention whilst on duty. Some of the cases may be less serious, meaning that the employee can be treated and then report back to work. In such instances, a lot of time is wasted when the medical centre is not near their place of work. The actual presence of healthcare centre can cater for employees’ healthcare requirements. Independently, the employer can offer health care opportunities to workers and their qualified family members. For instance, the employer can opt to go for a strategy that suggests a high-deductible health plan (HDHP), which is associated with health savings account (HSA).

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However, Alcalde (2011) cautions that if an employer decides to offer HDHP/HSA to workers, while at the same time servicing them with on-site health care services, then attention should be paid to establishing the fee schedule for on-site health care services. This is because if a wide array of medical services are delivered on-site and the pricing is not done carefully for HSA participants, workers who have selected coverage may risk losing their HSA eligibility. Alcalde states that, “this is due to the fact that in order for HSAs to remain tax-advantaged, participants must pay the full market value of nearly all medical services they receive until such time that they satisfy the HDHP annual deductible” (2011, p. 1).

Low-price health services offered at on-site health centres may disqualify employees’ from enrolling to the HSA program. Participation in an HSA program while one is not eligible can lead to serious penalties, some of which include: loss of income, prohibiting from contributions and liability to some taxes. However, on-site medical centres can offer some medical services without jeopardizing employees’ qualification to HSA. Some of the services are physical examinations, immunizations, treatment of allergic reactions, pain relief and treatment of accident injuries.

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On-site or Near-site Meal Facilities

It has been observed that employees spend more time than is allocated for meal-breaks to get to their favourite eateries and come back to work. This problem can be averted if Eagle Airlines could set up on-site or near-site eating facilities. This can be done either solely and for its own employees, or in another way, the company can partner with other airline companies with the same interests to set up the facility.


From time to time, the management will need to hold meetings with other managers, heads of departments or with all employees as in the case of general meetings. These calls for selection of a particular venue and some of individuals will have to travel to get there. Travelling and accommodating employees results in unnecessary expenditure. The loss may even be greater in cases when the meeting may be called off due to unavoidable circumstances.

According to Cross and Kelleher (1985), teleconferencing allows two or more users to communicate with each other simultaneously using telephones. With emergent technology, it now involves the use of video cameras, in which case it is then referred to as video conferencing. Teleconferencing and/or video conferencing helps to eliminate the need to travel, therefore, contributes to reducing costs and time spent to convene a meeting. The element of saving time is especially true in regard to scheduling and preparing for a meeting. Whereas a physical meeting may take days or weeks to schedule, with teleconferencing the meeting can be scheduled within a day or even hours (Margulies 1997). Teleconferencing will also enable far more individuals to get in touch than would be the case for a physical meeting.

Recreation and Leisure

The airline industry involves a lot of hospitality since it is service-oriented. The industry is characterized by long working hours which often times begin in very early hours of the morning and extend well into the night and sometimes may involve night shifts. Most of the time employees will be involved in direct interactions with clients. This in itself can be stressful as some clients may be verbally abusive when their demands or expectations are not met.       

Recent studies have shown that most employed adults do not engage in sports and other recreation activities as much as their unemployed counterparts and young adults (McLean and Hurd 2011). This may be due to the fact that most of their off-duty time is spent on resting and attending to responsibilities not related to work. Working parents are at even greater risk of not engaging in leisure activities because of increased responsibilities in terms of taking care of their children. Continued lack of exercise is likely to lead to poor health status which in turn negatively affects performance at work. According to Finn (2008), engaging in sports activities has numerous physiological and psychological benefits. For instance, it helps one to lower serum cholesterol and hypertension. It also leads to increased bone mass, boosts immunity and reduces stress. Sport is also known to improve attitude and performance, especially in those areas where a lot of movement is involved.

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In view of the above facts, introduction of a sports and recreation centre at Eagle Airlines firstly will ensure that the company not only has healthier employees. Secondly, employees will be more focused and will enjoy carrying out their assigned tasks. The American Council on Exercise (2000) encourages employers to create some time for leisure and recreation during work hours. This is because it will allow employees to rest and revitalize emotionally and psychologically, hence improving their performance at work.


European airline industry is highly competitive and in order to stay ahead of the pack, Eagle Airlines has to come up with appropriate strategies to attract more clients. The company has employed highly competent staff in various departments to ensure this. However, other than skill, these employees’ performance is determined by other external factors such as personal obligations and physical disposition to work. Issues such as problems with health, fatigue and personal responsibilities are likely to negatively interfere with their productivity. It is for this reason that Eagle Airlines has come up with this proposal to ensure maximum employee productivity.



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