Struggling Hong Kong Airlines has revealed the latest round of job losses facing the airline’s staff. This week, notices have begun being sent out to around 700 employees, notifying them of redundancies from July 31st. The airline is undergoing a drastic restructuring in a bid to survive two tumultuous years.
Staff reduced by two thirds
Beleaguered Hong Kong Airlines is laying off some 700 members of staff, with redundancy notices being issued from yesterday onwards. The struggling airline, which is backed by already bankrupt HNA Group, will let go of around two-thirds of its staff as it struggles to make its way out of the current crisis.
Following the staffing cuts, only around 100 to 200 employees will remain. The affected workers come from all sectors of the business, from flight crew to flight attendants and ground staff. The airline has indicated that July 31st will be the last working day for these employees.
Speaking to the Hong Kong Standard, a spokesperson for the airline said that the company is currently in survival mode and needs to transition to a smaller, more efficient organization in order to succeed. They said,
“As we downsize by merging departments and consolidating job responsibilities, employee surplus in the new operational structure are being addressed through various actions.”
The options for affected staff include a Long Pay Leave Scheme. Executives and management are having salaries reduced from the current cut of 15% down as much as 36%, depending on seniority.
As well as the airline workers, employees of the Hong Kong Aviation Ground Services company are also facing redundancy. The firm said it would be ceasing operations from July 1st, with an estimated 240 employees affected.
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Survival mode
The airline has been in dire straits for some time, with crisis after crisis impacting operations and profitability. 2019 saw mass protests in Hong Kong, which caused travel demand to plummet. With no strong connecting network, Hong Kong Airlines was impacted as much, if not more, than Cathay Pacific.
In a bid to cut costs, the airline withdrew inflight entertainment and ended all long-haul routes. Salary payments to workers were delayed, and at one point, it looked as if the company would lose its operating license. While it ultimately held on to its license, largely thanks to a half a billion-dollar loan via its parent, the HNA Group, the troubles were not over for the airline.
Even before COVID hit, seven of the airline’s aircraft were seized by creditors. 400 workers lost their jobs in February, as the impact of COVID began to show. Since then, it’s largely been all downhill.
The airline is striving to transition to being a smaller, more efficient airline, something that has seen a drastic restructuring taking place. The airline grounded all its A320s for a year, and is planning to only fly its A330s on cargo routes for the foreseeable future. This latest round of headcount cuts is just the next step in the process, but will be of little comfort to the hundreds of workers who are left without a job.
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