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LIAT pilots take a pay cut to keep the airline operational

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LIAT pilots take a pay cut to keep the airline operational

Unread post by bimjim » Sat Apr 13, 2019

https://www.caribbeannewsnow.com/2019/0 ... erational/

LIAT pilots take a pay cut to keep the airline operational
April 3, 2019


Antigua and Barbuda Prime Minister Gaston Browne said previously that LIAT pilots were on board with the plan to restructure the regional airline to make it a more viable entity financially. This is now a reality, allowing the much-needed restructuring of the company can proceed, albeit the pay cut is less than the ten percent recommended by the airline’s shareholder governments.

This decision by LIAT pilots is geared to help the regional airline overcome its financial difficulties in addition to the financial assistance of regional government for emergency funding of US$5.4 million.

Browne welcomed the agreement in principle to salary cuts, and that good sense prevailed among the pilot’s association, trade union representatives in 15 destinations.

Browne previously explained that “We (shareholder governments) said that even though estimates were around ten percent, we agreed that even if it was five percent something had to be done to reduce the staff cost. This is one of the major costs, with the understanding too that we could introduce a profit sharing element in which they could share in the future profits, and that will mitigate hopefully against any loss that they would have had in terms of the salaries and wages, so they recover it at the bottom end.”

With this decision to “carry some of the burden and avoid collapse of the airline… this will allow us to pursue the restructuring plan by the Caribbean Development Bank (CDB).”

“The plan is to increase the operational efficiency of LIAT to reduce costs while at the same time increasing revenue primarily through the charging of a minimum revenue guarantee to make sure that the routes that are not profitable, the countries that want LIAT to continue those routes then they have to pay for them,” Browne said.

LIAT pilots’ decision follows a meeting with St Vincent and the Grenadines prime minister Dr Ralph Gonsalves and chairperson of LIAT’s shareholder governments that “yielded some progress,” making tough business decisions on the way forward.

“I think that everyone is buying into an amended restructuring plan where there is burden sharing and the employees are prepared to bear some burdens. The extent of what is to be borne we will know in a couple of days when we talk to their members, but we had a very positive response,” Gonsalves said.

Meanwhile 11 destinations are considering the airline’s minimal revenue guarantee (MRG) well beyond the March 15 timetable. Saint Lucia’s prime minister, Allen Chastanet believes “there should be competition” and that “if LIAT remains the same, Saint Lucia will not participate, but if there are these fundamental changes, then we would be very happy to do that.” Thus far, he “clearly believes there needs to be open skies.”

Prime Minister Dr Keith Rowley of Trinidad and Tobago has indicated that his state-owned carrier, Caribbean Airlines will “pick up the slack” if LIAT cancelled routes to Trinidad and Tobago.

Prime Minister Mia Mottley of Barbados and LIAT’s majority shareholder has decided that “the core elements of a new, sustainable model for LIAT are already clear and that suppliers, commercial financiers, and labour will provide major cost cuts; any flight with below average revenues will need to be subsidised or cut.”

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