Significant disruption to LIAT flight schedule could lead to shutdown – CEO

Chief Executive Officer (CEO) of LIAT David Evans has said if there is “significant disruption” to the LIAT flight schedule over the Easter period, that situation could lead to a shutdown of the airline.

In a release issued last week, Evans said “We will do everything we can to minimise industrial action over the Easter period, for the sake of the travelling public.{{more}} If however, there is significant disruption, the resulting financial crunch would mean that salary payments would be further delayed, and the airline would be unable to meet the demands of its creditors. Such a situation would put LIAT in a position of no return, leading to a shutdown of the airline. This would be catastrophic for the entire region and its economies, and or the jobs and livelihoods of thousands of people.”

The release from LIAT came the day after the Leeward Islands Airline Pilots Association (LIALPA) put the public on notice that “poor working conditions” at LIAT has caused the crew to suffer from “increased stress,” which may have “a negative impact on the airline’s flight schedule.”

The pilots asked for the patience and understanding of the public as they continue to address the situation with LIAT.

Citing a deteriorating state of industrial relations between LIAT and LIALPA, the association registered its disappointment in the company’s decision to confirm the dismissal of two of their colleagues.

The release pointed to the “incomplete and poorly planned implementation of the aircraft fleet renewal project inclusive of pilot training,” an unstable flight schedule and “poor Executive Management decisions,” which they say all contributed directly to the deferral of the pilots’ salaries over the last 16 months.

“The Shareholder Governments who are ultimately responsible for the management and funding for the airline cannot expect to run the operations on the backs of its pilots. Any short-fall of funds for salaries should be provided by the Shareholder Governments.”

They also cited the issue of “illegal and unauthorized deductions from the pilots’ salaries,” which they say have been placed into a pension escrow account, when these monies should have been placed into a provident fund, as directed by a High Court Order.

LIALPA also said no increases in salary or rates of pay have been agreed for the heavier ATR-72 aircraft, despite lengthy negotiations, and this constitutes to be a breach of the Collective Agreement and the Arbitration Award.

“The above-mentioned conditions have resulted in the mass attrition of the pilots resulting in crew shortages on many days. Despite the loss of approximately 10% of its pilot workforce over the last 12 months, the Company’s response to these issues is to resort to unethical rostering practices such as elimination of crew meal breaks while increasing the amount of hours worked on the more complex ATR aircraft which has resulted in increased fatigue and illness. This goes against the Eastern Caribbean Civil Aviation Authority (ECCAA) Regulations,” the release said.

LIAT, in response, in a release issued March 19, said they consider the statement to represent the views of the pilots and that it is highly suggestive of industrial action being threatened.

“Threatening industrial action shortly before a public holiday, in this case, the Easter period, is a common, often repeated and cynical tactic employed by LIALPA to exploit the fears of the travelling public,” the release from LIAT said.

Chief Eexecutive officer David Evans said all of LIALPA’s grievances are either before the courts, or being dealt with in the normal manner.

He said in relation to pilot dismissals, the company is quite convinced it acted correctly in this matter, and it is before the courts.

The CEO said 90 per cent of the new fleet will be in place by April. The removal of the old fleet has been hampered by lack of capital, soft economies, weak aircraft markets and unnecessary industrial action.

Evans said in relation to the pension fund, the deductions which have been made are neither illegal nor unauthorized.

“The Courts held that in the management of the pension funds, the company was acting in the best interest of its employees.

“There is no breach of the Collective Agreement or the Arbitration Award. Both require the parties to negotiate. The company has proposed an increase. The pilots are demanding an 18% increase across the board which is impossible for the company to meet.”

The CEO also said attrition rates in the pilot community are 5 per cent, which is at or below the average for regional airlines globally.

“On average LIAT pilots fly less than 50 hours every four weeks. LIAT complies fully with all applicable ECCAA regulations which permit significantly more flying hours per pilot than currently obtains. LIAT is hoping, in the future, to attain the levels permitted by the regulator,” in relation to crew rostering.

Evans said shareholder governments have said that they are prepared to put more equity into LIAT, providing it reduces its costs and improves its operational performance.

“The largest contributor to LIAT costs are employee costs. All shareholders are unanimous in their agreement that costs must be reduced. With respect to operational performance, the single largest contributor to poor performance is unplanned crew absence,” the LIAT release said.

“I have had dealings with numerous pilot associations over many years and in many jurisdictions. These dealings have often been tough and uncompromising, but always based on mutual respect and a clear understanding of the needs of the business. This has not been my experience with LIALPA. Unless we can reach a common understanding of LIAT’s current circumstances, LIAT’s future looks bleak.”