LIAT to start issuing termination letters today

LIAT enters administration

The collapsed regional airline LIAT is expected to start issuing termination letters to hundreds of employees and management officials tomorrow.

Well-placed sources in Antigua and Barbuda, where the company is based, disclosed this today following a meeting between the workers’ unions, the Leeward Islands Pilots Association (LIALPA) and the administrator of the proposed restructured airline, Cleveland Seaforth.

However, the source said that there is still some confusion over the termination process in that, according to the Antigua Labour Code, the staff had already been terminated due to the length of time they have been laid off.

One staff member is questioning the implications of a recent statement by Antigua and Barbuda Prime Minister Gaston Browne that he wants to rehire 100 employees after terminating all contracts.

“If he is keeping 100 people, what happens to the other 570 who will be on the streets? That also means 25 pilots will be sent home,” the worker asked.

The source said the staff is also concerned about severance pay which appears to be in immediate doubt.

“Severance figures will be available in draft next Friday to give the employees a chance to question the figures if necessary. These figures will also include owed retroactive pay, vacation pay and owed salaries. The overall severance figure has increased. The figures are derived from the Collective Agreements and/or the Labour Code in the absence of an agreement,” said the informant.

Two options that emerged, according to the source, are the sale of the LIAT assets, except secured debt, such as three ATR 42 aircraft.

Barbados TODAY has been told that if this option is used, “we are looking at five cents on the dollar.”

Another option is two potential investors indicating they may consider paying the severance of the workers.

“No governments have indicated directly that they are willing to pay severance at this time. This can change when the final report has been made by the administrator. The administrator is putting forward another concept which is gaining some traction, but it is too early to discuss currently,” the source stated.

It is understood that the administrator has to present his report to the law courts no later than November 20, 2020 and has promised to come back and discuss his report with all unions.

“The administrator had mentioned in the past, the idea of approaching CARICOM for assistance to pay severance; however, he has not done it as yet,” Barbados TODAY has been told.

According to a source close to the meeting, the administrator said the five cents on the dollar could be reduced, if the Antigua Government took back the money it had put into the airline.

The meeting was also informed that LIAT cannot resume operations on November 1 because there is a lot to be done, including maintenance of one ATR 42 aircraft.

“The administrator has said that there is a belief that LIAT could operate a small schedule for three months fully funded by the Antigua Government. They will be flying two of the 42s owned by the company and do not know where the PM got the idea that it was four planes. It is the hope that after the three months, a new investor will take over the company next year,” disclosed the source close to the talks.

LIAT is in the process of being restructured and the intention is to fly again under a smaller operation.

When contacted, President of LIALPA Patterson Thompson told Barbados TODAY he still had to have follow up talks on the termination issue and therefore had no comment to make at this time.

The administrator could not be reached for a response.

Emmanuel Joseph | Barbados Today