MALINDO Airways is cutting about 2,000 jobs in a retrenchment exercise as Covid-19 takes a major hit on revenue.

It has a workforce of 3,200.

Chief executive officer Captain Mushafiz Mustafa Bakri said in an internal memo sighted by The Malaysian Insight that the airline’s earnings had shrunk by 90%.

“The last few months have been extremely challenging for us as a business owing to the ongoing Covid-19 pandemic which does not seem to be relenting,” he said.

“Owing to the border closures, we are unable to fly abroad. At the same time, there is hardly any demand for domestic air travel.”

As a result, he said the airline was making only 10% of its pre-pandemic monthly revenue.

Mushafiz said the airline has taken several drastic measures to reduce its fixed and operating costs, including halving its fleet.

It has offered staff the options of voluntary long term unpaid leave  and voluntary separation schemes (VSS).

The company has also suspended recruitment, reassessed wages, ceased allowances, overtime and mileage claims, and discontinued employment of staff above the statutory retirement age of 60, among others.

“Regrettably, these efforts were insufficient to avoid and overcome the severity and prolonged impact of the Covid-19 pandemic on our business,” Mushafiz said.

The Human Resources Department will notify the affected employees on the termination compensation benefits including the company asset handover process in the next few days. 

“Rest assured that the company has taken into account the due process in compliance with the law and regulations. The relevant authorities also have been duly informed of this exercise.

“The HR department will also assist the affected employees on the Employment Insurance Scheme (EIS) from Socso. We are also currently talking to service providers who would be able to assist displaced colleagues with retraining and onward job placements.” 

The airline had previously offered staff a VSS after it failed to secure loans to sustain operations.

It also previously prematurely terminated the contracts of staff during the movement control order period.

However, 50 cabin crew who were retrenched in April were later reinstated following negotiations between the airline and the National Union of Flight Attendants Malaysia. – October 29, 2020.