DUBLIN (Reuters) - Ryanair's RYA.I Chief Executive Michael O'Leary narrowly secured approval from shareholders on Thursday for a bonus scheme that could earn him 100 million euros over five years as he revealed up to 700 pilots could lose their jobs.

The Irish low-cost carrier, Europe’s largest, has been battered by industrial disputes and the grounding of Boeing’s flagship 737 MAX.

Having suffered from a shortage of pilots just a couple of years ago, O’Leary told investors there are now too many. He forecast the company would cut between 500 and 700 pilots as a sharp decrease in demand has seen the natural attrition rate collapse.

To earn his 100 million euro bonus, O’Leary would need to reverse a near-50% fall in the company’s share price since 2017. The share price hit a peak of 19.39 euros in August 2017 but was down 1.8 percent at 9.76 euros at 1330 GMT on Thursday.

O’Leary secured the backing of 50.5% of shareholders for the scheme which will grant him 10 million share options if he doubles Ryanair’s profitability to 2 billion euros per annum and/or increase the share price to 21 euros per share.

The size of the award “raises a red flag in terms of quantum and for our members,” said Jocelyn Brown of the UK Railway pension scheme, which voted against the deal.

O’Leary said he was disappointed by the level of support and said he would take on investor concerns.

FILE PHOTO: Ryanair CEO Michael O'Leary holds a news conference in Machelen near Brussels, Belgium October 9, 2018. REUTERS/Francois Lenoir

“I think most shareholders would take the view that if he doubles the share price, we don’t care what you pay him for the next five years,” he added.

TURNAROUND

O’Leary pitched to investors his plans to turn around the airline, whose biggest challenges are industrial relations disputes and the grounding of the 737 MAX after Ryanair ordered 135 jets with options on 75 more.

He said Ryanair will continue to challenge unions, whose strikes had been “complete failures” and the MAX delays would force capacity cutbacks for next summer.

Bases in the United Kingdom and Ireland are likely to suffer cuts, with 10-20 redundancies from 400 pilots at the airline’s home base in Dublin. The firm has about 17,000 employees across Europe.

“We are looking at voluntary (redundancies), but ultimately we will move from voluntary to compulsory very quickly,” he said, adding that pilots had already been offered 12-month unpaid leave.

UNION ANGER

As O’Leary spoke the British Airline Pilots Association (BALPA) accused management of threatening pilots who take part in strike action “with the removal of staff travel benefits and inflated and draconian deductions from salary.”

The International Federation of Air Line Pilots’ Associations said Ryanair pilot representatives were “being singled out for threatening and intimidating behavior” and that Irish company council representatives were being sued by Ryanair.

Ryanair, which recognized trade unions for the first time two years ago, denied any union members were being targeted in any way for their union activities.

“It is illegal to blacklist someone for being involved” in trade unions, he said. “It has never happened, but we have been accused of it for around 30 years now.”