Caribbean Airlines yesterday took both the Trinidad and Tobago Airlines Pilots Association (TTALPA) and Aviation Communication and Allied Workers Union (ACAWU) by surprise with the announcement that it planned to cut 25 per cent of its workforce, 450 employees, throughout its network whom the airline had deemed “surplus to its current needs.” The obvious question is why would an airline whose financial history has been up and down have surplus staff of 450 or more? What level of employees make up this surplus staff?
This is no small matter. There is no denying that CAL has been grounded in the main because of the COVID-19 pandemic that has impacted global air travel.
In the past months, CAL’s cost-saving measures have included layoffs without pay; compulsory vacation leave; salary cuts and Voluntary Early Retirement Plans (VERP).
Staff had no choice but to bite the proverbial bullet months ago in the hope that once things returned to a semblance of normalcy they would be back on the job.
It must have come as a huge surprise, therefore, when the airline announced yesterday that it itends to send home workers, prefacing this with its unaudited financial results for the first quarter of this year reflecting a TT$172.7 million loss and a 75 per cent decline in revenue compared to the same period in 2020.
There is no denying that the COVID-19 pandemic and suspension of operations would have been drastically affected its operations and the airline's finances are grim.
As recent as one week ago, Finance Minister Colm Imbert revealed Government had subsidised CAL to the tune of US$100 million (TT$700M) in 2020 and had taken responsibility for a number of loans CAL could not service. He made it clear then that the bailouts could not continue, advising CAL to “make itself as efficient as possible” for the resumption of operation.
Will a decision to send home 450 employees be enough for the airline to stand on its two feet financially? What would be the cost saved from such decision? Are there other things the airline can to become more efficient and viable as it prepares to take to the skies again?
Minister Imbert said he expected the airline to show a plan for a return to, at minimum, "a break-even position and then towards profitability” and spoke to a “restructured airline.” Was the Corporation Sole giving a hint of what the airline was expected to do?
CAL also hinted yesterday that in addition to staff cuts, it plans to reduce cost in other areas, including a reduction of jets in its fleet, other assets and it route network. CAL must now tell the country clearly what is its plan, especially as it relates to the workers' futures, and how it is going to recover from the deep sea of red it has found itself in.
The country needs to know what decisions are to be taken and how they are going to affect the bottom line. CAL is heavily dependent on taxpayers' money. Those in charge must understand it is not a private business and they owe it to the country to steer the airline into clearer skies.