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“Air Serbia” followed in the footsteps of Belgrade airport, which plans to reduce the number of workers, but also wages. Last week, employees of the national airline were offered a voluntary departure program with severance pay, and they were also announced a pay cut starting next month for all those who stay, “Politika” learned unofficially. .
How many workers are laid off and how much their wages will be reduced, the notification they received from management does not say, except for the explanation that the company has been streamlining operations for eight months and reducing costs to respond to the global aviation crisis and cannot bear costs. so high.
Interestingly, at the same time, the UAE company “Etihad”, which is a minority owner in “Air Serbia”, released a statement addressed to employees, in which it states that it will operate as a “significantly smaller company” in the next period, Reuters reported. The statement does not indicate the time limit in question.
It is known that “Air Serbia” currently employs 1,500 people, but yesterday we did not receive responses from the Ministries of Finance and Construction, Transport and Infrastructure, how many are redundant, how many compensation will be offered, how much will the salaries be reduced for those who do not request voluntary departure , as well as the state plan for this airline. Given that the Government of Serbia has a majority stake of 51 per cent, it would be logical that the relevant ministries had answers to these questions and a plan for “Air Serbia”.
It is clear that air traffic has been the hardest hit by the Kovid 19 pandemic and that airlines around the world are canceling aircraft orders, laying off tens of thousands of people and disembarking fleets. “Air Serbia” has halved the number of routes it currently flies in relation to the 63 lines it operated on before the outbreak of the health crisis.
It is not known what the losses of this company are. Zorana Mihajlović, former Minister of Construction, Transport and Infrastructure, spoke in May with an estimate that losses in our air traffic will increase from the then 40 million euros to 190 million euros by the end of the year. The International Air Transport Association (IATA) predicts a loss of $ 84.3 billion globally in 2020, representing a 66 percent drop in air traffic demand. Experts predict that the level of traffic in the world from 2019, before the crown, will be reached only in 2023 or 2024. Companies have already implemented various models of reorganization. On average, they laid off about 25 percent of people and cut wages by about 20 percent.
That example is followed by the French “Vence”, which received the airport “Nikola Tesla” for the concession management. Last month, it announced a reduction in the number of workers, because there are currently 19 airlines operating at the airport, while last year there were 27 at the same time. Severance pay of up to 1 million dinars was offered for the voluntary departure of full-time employees. The contracts will not be renewed.
In addition to reducing the number of employees employed by airports and airlines around the world, one of the relief measures is state subsidies, mainly to airlines. Several times we have heard from Serbian officials who will help “Air Serbia”. On June 14, Serbian President Aleksandar Vučić declared that the state would ask “Etihad” to hand over a portion of the money for losses suffered in the past four months.
– We are ready to enter “Air Serbia” with our money, we are ready to recapitalize, but we will not give up on further construction of the company – he said then.
That will now be possible because the Government of Serbia recently adopted a decree on the recapitalization of state-owned companies. “Air Serbia” will receive state aid with the budget rebalancing. Although this is not explicitly stated in the rebalancing, the Fiscal Council estimates that the bulk of some 150 million euros of net budget loans will go to “Air Serbia”.
Milan Kovacevic, an investment consultant, says that the 150 million euro aid to “Air Serbia” was called a loan and that the next step would be recapitalization.
– Giving severance pay is not a good practice. Costs must certainly be reduced, but care must be taken not to be the choice of those who leave, but to offer severance pay to those without whom it is possible. The reduction in business reduces services at the airport. It is not so easy to find pilots who would like to collect compensation and go to another airline, warns Kovacevic.
It says that from the “Etihad” statement, in which they say they are downsizing their business, it is clear that they will reduce their stake in companies in which they have a 49 percent stake more than in those in which they own 100 percent. .
– “Etihad” and the government do not function as an assembly of two owners, as it should be. If it were different, not only would they give me loans, but “Etihad” would also give me a loan. When it comes to recapitalization, if we recapitalize “Air Serbia”, the question arises whether they will. Nowhere does it appear that they are doing anything together, says Kovacevic, emphasizing that the biggest problem is that the state does not hire professional and quality managers in public companies and in companies in which it has interests.
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