Air Malta: GWU members overwhelmingly approve termination deals

95% of GWU members at Air Malta approve agreement with government providing for various termination schemes that include early retirement compensation

Air Malta is undergoing a restructuring process
Air Malta is undergoing a restructuring process

Air Malta workers who are members of the General Workers’ Union have overwhelmingly approved termination deals negotiated with the airline, the union said on Thursday.

In two meetings held today and yesterday, 95% of GWU members at the national airline voted in favour of the agreement that includes an early retirement scheme. The GWU represents administrative staff and ground handlers. 

The early retirement scheme is a new addition to government’s original plan to offer only a redeployment scheme in its efforts to restructure the ailing airline.

The company had received 571 applications  from the 824 eligible employees when the redeployment scheme closed on 11 February. This was more than the government was expecting and a 12 August deadline to finalise the transfers has now been pushed forward.

The GWU said workers who applied to be released from their job at Air Malta will either be transferred with government company RSSL with a similar take home pay by the end of the year or benefit from one of the early retirement schemes that was finalised recently.

“After months of discussions between the government, Air Malta and the trade unions, we pulled the same rope and reached an agreement on early retirement schemes and an extension of the date by when Air Malta employees will be transferred to RSSL,” GWU Secretary-general Josef Bugeja said.

The GWU was represented in the talks by section secretary Sandro Vella.

The development signals a u-turn on Finance Minister Clyde Caruana’s original plan not to offer early retirement schemes as part of the restructuring process.

On Wednesday, MaltaToday revealed that the 12 August deadline for the early termination of employment has been pushed forward to the end of the year.

The move was partially necessitated by the airline’s healthier summer loads as tourism picks up from the pandemic. Airline bosses feared that the transfer of almost 600 workers into the public service would have hampered its services. But government was also finding it difficult to assimilate well-paid Air Malta workers in the civil service.

Plans changed this week during talks between unions and Caruana for a new 31 December deadline and the introduction of a voluntary retirement scheme that will now be offered to employees.

Details revealed by MaltaToday show that the early retirement and voluntary redundancy schemes are non-taxable and will be paid in a one-time instalment. Anyone taking one of the two schemes is not eligible for work in the public sector or the public service for the next six years.

The proposal, which was agreed upon with the GWU, the Union of Cabin Crew, the Airline Engineers Association, and the AAOC union, will offer €40,000 to those who have served up to five years; €80,000 to those serving 5-10 years; €120,000 for 10-15 years of service; €150,000 for 15-20 years of service; €180,000 for 20-25 years; €210,000 for 25-30; and €240,000 for those of over 30 years of service.

Air Malta staff aged 50 and over are eligible for an early retirement scheme if they have served 20 years and over, to be paid two-thirds of their total take-home pay, capped at a maximum €300,000.

On 14 January, government announced it would create a voluntary employee transfer scheme in a bid to cut Air Malta’s workforce by half and save €15 million per year in wages as part of a restructuring exercise.

The Nationalist Party has said that the government’s plan to make Air Malta financially viable had failed. “Clyde Caruana should come clean and speak with the same honesty he spoke with last January, and say if government’s plan to restructure the airline is still credible and achievable,” PN Air Malta spokesperson Ivan J. Bartolo said, earlier this week.