CAL offers early retirement in latest cost-cutting move

MONTHS after instituting furlough and wage reductions, Caribbean Airlines Ltd (CAL) is now considering reducing staff and offering Voluntary Early Retirement Plans (VERP).

In an e-mail shown to Newsday sent by management, workers were told that given the company’s financial situation, CAL has no choice now but take such actions.

The e-mail also asked staff earning less than $20,000 monthly to accept an offer of a further five per cent salary reduction. They had up to Friday to respond.

“The CEO (Garvin Madera) confirmed that CAL’s financial situation remained precarious to the point where the company now has no choice but to institute plans to permanently reduce staff. He announced that the initial step in that regard would be the offer of VERP.”

The e-mail said while the plan is in currently in motion, other cost-cutting measures needed to be implemented such as temporary lay-offs and further salary cuts. The latest salary cuts will take effect from June 16 to the end of the year.

In September last year CAL introduced cost-cutting measures, which included salary reductions for eight months from mid-October 2020 for those paid more than $7,500 a month, on a tiered structure. Temporary lay-offs for approximately one third of employees for three months, depending on their function, was another measure. The third was reducing contractors and temporary workers and cancelling allowances that were no longer relevant.

Asked if any staff had resigned since CAL initiated these measures last year, head of corporate communications Dionne Ligoure said that was confidential information.

She added that discussions are ongoing with regard to those who are considering accepting VERP.

“This is a difficult time for airlines globally and for Caribbean Airlines. However, the human resources department, supported by the management team, continue to provide information and support to employees, as we navigate this unprecedented scenario.”

General secretary of the Aviation Communication and Allied Workers’ Union (ACAWU) Peter Farmer said the union was against the extension of the furlough.

“We suggested that they put staff on a rotation instead of temporary lay-off. We were told that the union is not the recognised majority union, so they will not hear from us.”

Ligoure said CAL has two recognised majority bargaining unions, TT Airline Pilots Association (TTALPA) and Bustamante Industrial Trade Union (BITU) in Jamaica.

Newsday e-mailed TTALPA on Friday and is awaiting a response.

Farmer added that from the e-mail sent to workers, they have no choice but to accept the offer, as the alternative is to be sent home. He added that Jamaica is currently rotating staff and questioned why that was not being done in Trinidad and Tobago.

The e-mail added: “If you are inclined to accept the extension of the temporary salary reduction please let us know by May 14 as we may have to escalate measures beyond the VERP to achieve the required reduction in manpower hours.”

Last April, a month after TT closed its borders, CAL sought a government-guaranteed US$65 million loan to help it stay afloat.