More than 700 workers of Fiji Airways have had their employment terminated in a bid by the airline to save on costs, retaining only staff in critical areas of operation due to depleting revenue as a result of further suspension of international passenger travel.
Workers whose contracts were terminated include eight expatriate executives, leaving five expats including the airline’s Managing Director and Chief Executive Officer Andre Viljoen and six locals, who make up the leadership team.
“All 79 expatriate pilots have had their contracts terminated,” Viljoen said in a statement. “Fifty-one per cent (758) of employees from across the Airline Group who do not have work today or in the foreseeable future have had their employment terminated.”
Managing Director and Chief Executive Officer Andre Viljoen
Fiji’s national carrier said the 758 workers will be paid a minimum notice period of one month (despite most employees having a two-week notice period), plus any accumulated leave and other entitlements.
“These employee terminations are based on work available today and for the foreseeable future. These decisions have been carefully considered, and we have retained staff in operational areas who have critical skills, training and experience, including those who are required to carry out ongoing aircraft maintenance programmes, as well as all regulatory and safety-related post-holder positions as per Civil Aviation Authority requirements.”
Managing Director and Chief Executive Officer Andre Viljoen
Fiji Airways said the adjustments are necessary and unavoidable, adding that the further suspension of scheduled international services meant that the airline will receive virtually zero revenue in the coming months.
The airline will implement further cost reduction measures including cutting their retained workers pay by 20% effective next Monday, June 1.
“In the short term, retained staff will work between 2-5 days per week, and will only be paid for actual days or hours worked. Employees will be permitted to utilise annual leave days on days not worked, in order to ‘top up’ their weekly pay,” Viljoen said.
Fiji Airways said it is also negotiating with its lenders and aircraft lessors for loan and lease payment deferrals, and arranging debt finance from a number of financial institutions.
“This is a very difficult announcement, and one we are only making after exhausting all other options. The sad reality of prolonged flight suspensions means that we simply do not have work for a large segment of our workforce now, and for the foreseeable future. We have no other option but to terminate the employment of staff to whom we cannot provide work, which is an unfortunate but vital step we must take in order to protect our cash position and to preserve as many jobs as possible for those staff who the business needs in order to function today.”
Managing Director and Chief Executive Officer Andre Viljoen
Fiji Airways recently extended the suspension of international flights through to the end of June, and is in the process of reducing scheduled flights for July and August.
“When the first flight suspensions were announced in March 2020, we implemented a series of actions aimed at tiding us through the April to June period, in the hope that the crisis would abate and some level of demand would return. Most of our workforce agreed to a temporary 30-35% pay reduction. However, regrettably, all of our international passenger services remain suspended, and it is simply not sustainable to continue to pay staff who are at home and not working, even at reduced salary levels. We have a responsibility to our shareholders, and to the Fijian people, to ensure that Fiji Airways survives this crisis.”
