CYPRUS Airways’ (CY) top brass were yesterday due to finalise the list of redundancies under a controversial rescue plan for the airline.
Unions representing airline employees have agreed to the plan, which stipulates that 385 people will lose their jobs. So far 355 have opted for voluntary exit; the remainder will be axed, but will also receive a compensation package.
CY’s board of directors convened yesterday to decide who would go and who would stay. Chairman Lazaros Savvides said the board would also look at other issues, such as the status of so-called seasonal workers.
Earlier this month, unions grudgingly agreed to the plan, what with the sword of Damocles hanging over their heads – the government had warned it would shut down the company if they did not.
But they are now complaining of being left in the dark ever since, and fear that management’s choice of forced redundancies will cause more trouble.
These concerns were voiced yesterday by Andreas Pierides, general secretary of CYNIKA, the airline’s largest union.
“We have had no contact whatsoever with management since we said ‘yes’ to the plan. We hope they will respect the code of industrial relations and not behave arbitrarily,” he told state radio.
“At any rate, we shall not tolerate any unilateral decisions.”
Many union delegates doubt whether acceptance of the plan will salvage the cash-strapped airline, which is currently losing £2 to £3 million a month. They wonder whether the government will not get back to them sometime in the near future demanding even more concessions.
Under the restructuring plan, CY’s operations were to be merged with those of its charter firm Eurocypria to save overall costs for the group. But a contingency plan has been drafted to separate the smaller airline because, if the national carrier goes under, so will the charter firm as its subsidiary.
Irrespective of whether CY is closed down, the government has made it clear it will buy Eurocypria, although the timing of the move will depend on how it all pans out with the restructuring plan.
Eurocypria was set up in 1991 as a low-cost charter firm and has become of late one of the few profitable ventures for the CY group.
The airline, which employees around 150 people and has four aircraft, is said to be worth in the region of £15 million, as evaluated by PriceWaterhouseCoopers.
But critics say the buyout is really a subsidy in disguise, given both companies have the same owner – the state. Such legal complications have taken the government back to the drawing board, although Finance Minister Michalis Sarris said yesterday that the exact terms of the purchase would be finalised by the end of the week.
Meanwhile, CY chairman Savvides said that company executives would likely meet in Brussels with European Commission officials on January 30 or 31 to present to them the latest version of the plan.
The debt-ridden national carrier has applied to the EU for approval to seek a £58 million loan to implement the bailout plan, which involves staff reductions, across-the-board salary cuts and other cost-saving measures.
