Anger over BA's 'glass palace'

THOUSANDS of jobs are being axed, planes sold, routes abandoned, debts piled up. And the share price has plunged. But the futuristic £200m 'glass palace' known as Waterside - headquarters of British Airways near Heathrow - remains intact.

BA chief executive Rod Eddington has ruled out selling the extravagant monument to feng shui. He told Financial Mail: 'The problem with Waterside is that it does not have enough people in it. I want to sell some of our buildings around Heathrow and move the staff into Waterside.'

But the decision to retain the building has inevitably angered BA staff as they face a highly uncertain future. The announcement last week that a further 5,700 jobs are to go brings the total to 13,000, a quarter of the workforce. As Ed Blissett, national officer of the GMB union, said last week: 'If they had spent less time and money on an airy headquarters with bubbling streams, they might not be in such a mess.'

The contrast is startling between the headquarters of BA, which is losing £2m a day, and those of its no-frills rivals easyJet, Go and Ryanair, all returning record profits.

EasyJet has a converted hangar at Luton, while Ryanair is run from a drab building near Dublin airport's runway. Go, the former BA-owned low-cost subsidiary based at Stansted airport in Essex, operates from a conventional two-storey building shared with airport staff.

Lord Marshall, BA's £125,000 non-executive chairman, authorised the Waterside project in the mid-Nineties. The building, which houses 3,000 staff, was supposed to introduce employees to a new way of working and thinking. They operate in offices and surroundings where New Age feng shui lifestyle experts have run riot.

When Norwegian architect Niels Torp was put in charge of what turned out to be one of the largest projects of its kind in Britain, he was told to create a building 'that will be a catalyst for change, transforming the way BA does business'. It ended up as six, four-storey truncated pyramid-shaped buildings, each with its own individually designed courtyards arranged alongside a 175-yard glazed atrium street.

Every whim of staff is catered for. They may order weekly shopping electronically from an inhouse Waitrose store. And keep fit enthusiasts can use a gym equipped with the latest high-tech equipment. The building houses a bank, shops, cafes, a florist and a hairdresser. There is even a beauty therapy salon, where staff - mainly men, according to insiders - may enjoy massages (head and shoulders) and beauty tips.

Waterfalls and a stream were incorporated into the building to further boost staff creativity. And when workers look up from their desks, they can gaze at works of art designed to 'emphasise the global nature of our business'. According to BA, after the building was opened by Prince Charles in 1998, working practices had changed so much that specialists on workplace behaviour had to be hired.

The liberation provided by the new building was not confined to staff. Dragonflies, kingfishers, and water voles, which until then had to endure a 280-acre wasteland, found that BA had created a new green environment for them. Waterside was the centrepiece of a public park and nature reserve. Tons of soil were moved and cleaned so that animals could enjoy the newly created undulating park featuring two man-made lakes, a bat cave and a cliff designed for sand martins.

There is certainly no haven for bats and water voles at easyland - the lurid orange converted hangar where about 450 easyJet staff are crammed into the once corrugated shed. Most staff in 'the hangar' are telephonists selling flights. Marketing experts and managers squeeze into what small space is available. There is not an economist in sight, compared with three full-time 'thinkers' at BA.

There is no special office for easyJet boss Ray Webster. He has a no-frills desk just like any other member of the staff. The only concession to a New Age experience is the Friday evening free barbeque where staff mingle and have the odd beer. They do not wear ties or suits because to do so, according to insiders, can mean only one of two things - you are going to a funeral or to a job interview. A spokesman for the airline said: 'We are a no-frills airline and that means the same for us as for the passengers.'

Only Virgin Atlantic's leased headquarters, The Office, a mile from Gatwick airport, bears any similarity to Waterside. There are just 1,300 staff, but like their BA opposites they can experience the full joy of massages in a beauty salon and can work out in gyms. There is even an attempt at creating atmosphere by building the offices around a Japanese garden.

A spokesman for Virgin Atlantic said: 'After the terrible events of September 11, we bit the bullet and worked on a new plan. It took six days of hard work, then we agreed to cut 2,000 jobs out of 9,200. Contrast that with BA, which took six months to come up with another 5,700 job cuts. It is not surprising that airline is eating up cash.'

Eddington disagrees. He says: 'We have cash and we have been radical. A quarter of our workforce will lose their jobs. Telling 13,000 they have no future here is very painful.' Sources close to Eddington say he finds Waterside a little rich for his taste. He has not ruled out selling the building and leasing it back. But he believes he will get a better price when BA is seen as profitable and powerful, rather than a distressed seller of assets.

Meanwhile, Waterside remains a monument to a culture of corporate excess that has helped bring a national flag-carrier to its knees. A BA board member recently compared its outlandish design with the Aztec temples of the Moon and Sun in Mexico City. BA will hope that their 'glass palace' will not go the same way as that once great civilisation.

BA has reportedly mortgaged 26 of its planes to banks for £600m in an attempt to bolster its finances without calling a rights issue.