Aer Lingus and SIPTU will attend Labour Court hearings this morning to attempt to prevent a strike on Thursday which would ground its fleet.

Chaired by Mr Finbarr Flood, the hearings take place as the State airline's board holds an unscheduled meeting to discuss its weakening performance.

The company's chairman, Mr Bernie Cahill, called the meeting last week and is expected to consult afterwards with the Minister for Public Enterprise, Ms O'Rourke. While the airline is not facing an immediate financial crisis, figures at the highest level of the company are said to be concerned about falling ticket sales prompted by a slowdown in the US economy and the foot-and-mouth crisis in Britain.

"We're not going to make our budgets. If we were a plc, it's my personal view that we would be in profit-warning territory," said one.

Separate talks between the airline and its pilots' union, IMPACT, will be chaired by the Labour Relations Commission today. The pilots are seeking a 70 per cent increase to bring their pay in line with airlines such as British Airways.

A strike on Thursday by 3,000 clerical and operative staff would leave about 20,000 passengers stranded on what is one of the busiest days of the year.

Such action would follow two all-day stoppages in the past fortnight as workers represented by SIPTU seek "equity" with cabin crew in a round of pay increases which has already cost the company £20 million (#25.4 million).

SIPTU has claimed the airline acted in bad faith by concluding "more favourable" terms with cabin crew after it reached agreement with clerical and operative staff. Management figures reject that.

Moves to resolve the dispute come a day after the Taoiseach, Mr Ahern, said the action was not in the interests of SIPTU, the airline or the country.

On RTE Radio's This Week programme, he said: "The action is all the more regrettable because of the damage which it is doing to the airline at a time when they're under pressure because of foot-and-mouth and because of other issues."

The company's board has already put plans for a Stock Exchange flotation into abeyance.

It needs £200 million to complete its capital expenditure programme. But almost six months of talks have failed to resolve unhappiness over low pay linked to Mr Cahill's 1994 recovery programme which brought the airline from the brink of closure.

Despite the global economic slowdown, Aer Lingus management believes the best option is to float. It accepts that is now very unlikely before a general election.