Fiji Airways has laid off over half of its workforce. The Nadi-based airline yesterday announced that 758 employees who are not currently working and not expected to return to work anytime soon have been permanently stood down. The move comes amid the ongoing travel downturn caused by COVID-19 and revenues at the airline in sharp decline.
“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,” said Fiji Airways Managing Director & CEO, Andre Viljoen, in a statement on Monday.
“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.”
The laid-off employees have 48 hours to return Fiji Airways property and collect their personal belongings.
A vital cog in South Pacific aviation
Fiji Airways is a small but vital cog in South Pacific Aviation. The airline’s 13 jets normally whizz around the Pacific as far afield as North America, Japan, Hong Kong, Singapore, and Australia. But Fiji Airways suspended its international flights back in March, and those suspensions are ongoing until at least the end of June. The airline is operating some limited domestic and repatriation operations, but Mr Viljoen says revenue has all but evaporated, and there’s no relief on the immediate horizon.
The employees who received the bad news yesterday will be paid a minimum notice period of one month plus any accumulated leave entitlements. Among the positions lost are eight expatriate executives and 79 expatriate pilot roles. The layoffs will halve Fiji Airway’s payroll expenses.
“These employee terminations are based on work available today and for the foreseeable future. These decisions have been carefully considered,” said the airline CEO.
Effective June 1, the airline is also reducing salaries by 20% for all remaining employees. Most employees will not be working fulltime, and employees will only be paid for days worked, although accrued leave can be used to top up salaries.
The airline is keeping employees with essential skills, training, and experience, such as aircraft maintenance workers and those in critical safety-related roles.
Fiji desperate to join travel bubble
Tourism dependent Fiji is desperate to be included in the proposed Australia – New Zealand travel bubble. Tourism is worth over USD$2 billion to Fiji annually – about one-third of the island’s GDP. All three countries have managed well COVID-19 outbreaks, kept infection and death rates low, and are keen to revive their tourism sectors. The majority of tourists arriving in Fiji come from Australia and New Zealand, and an opening of borders between the three countries would provide a financial lifeline for Fiji Airways and the broader Fijian economy.
Andrew Viljeon sees his role as keeping Fiji Airways alive until border restrictions ease. When travel does pick up again, he hopes to be able to offer jobs to those employees who were terminated this week. He said yesterday;
“Tourism is the backbone of the Fijian economy, and it is dependent on a strong and sustainable national carrier. Fiji Airways will be vital in leading Fiji’s economic recovery post-COVID-19, and we take that obligation to the Fijian people very seriously.”