EMPLOYEES at Cyprus Airways (CY) were yesterday contemplating whether to accept a redundancy package or risk the company closing and receiving nothing.
CY management yesterday circulated to all staff its proposals to entice 500 people to leave the ailing carrier under a voluntary redundancy scheme.
It has warned that if 500 people, around one third of its workforce, do not volunteer, it would have to revert to its original plan to sack 385 and cut the salaries and benefits of the remainder to meet cost-cutting targets needed to save the airline.
Reports yesterday suggested there was initially not much interest from staff, but sources close to the company said it was far too early to say.
The employees have at least a couple of days to respond directly to their various managers. “Obviously, as soon as possible would be preferable,” said the source.
It appears that many of the employees, especially those who have been there for many years, fear that if the company closes they would be left with only their provident funds.
“I don’t want to leave, but I’m considering it because I am worried that I could be left with nothing after 20 years here if the company is forced to close,” said one employee.
A second staff member with long service also said he was contemplating taking the redundancy.
Andreas Pierides, the acting spokesman for CYNIKA, the airline’s biggest union, said yesterday the union had only had a small number of enquiries about the redundancy package after it was announced, but added that was before it was circulated yesterday.
“We hope with this plan we will find the required numbers and then we hope to be able to look at the other big issues concerning the operation of the company with the remaining staff,” he said.
Vice chairman Frixos Savvides and Transport Minister Haris Thrasou warned on Wednesday that if a solution could not be reached with the unions, the airline would have to close at the end of this month.
An initial rescue plan, calling for 385 layoffs, and reductions is salaries and benefits, was rejected by the five unions, who then submitted their own proposals, which found little favour with the company.
The latest CY proposal this week suggested the redundancy of 500 workers, around one third of its staff, something the unions accept on a voluntary basis only.
This would mean less cost-cutting on the salaries and benefits of the remaining staff, who would lose more if a bigger number of employees was retained.
Last month, CY handed over the initial plan to the EU as a precursor to approval of the £58 million loan needed for the restructuring. The state-owned airline secured approval for a £30 million loan last May, which will be paid back from the £58 million.
Speculation has been rife that the government has a Plan B up its sleeve, which might involve closing the company and re-opening it under another name, rehiring fewer staff at more competitive rates.
