Clyde Caruana gives Air Malta pilots ‘brutal’ take it or leave it package

Air Malta pilots were informed they will have to fly more hours and take a 15% wage cut during a tense meeting with Clyde Caruana. 

The Finance Minister presented the new working conditions to the Airline Pilots Association last Thursday with industry sources telling MaltaToday the package was presented as “a fait accompli”. 

The new conditions remove the Maltese language as a requirement for recruitment, paving the way for the employment of foreign pilots. The package also ditches the generous early retirement scheme pilots have benefitted from over the years. 

Air Malta pilots keep receiving two-thirds of their wage from the airline until they reach 65 if they retire at the age of 55, an expense that has cost the company millions. 

The current crop of pilots was offered “a last chance” to take the sum of money owed to them as per the existing early retirement scheme and leave the airline for good with no possibility of being employed with the government; or remain employed with the airline with the new conditions. 

“The minister was adamant that moving forward there will be no early retirement schemes,” the sources said, adding the meeting was “not a negotiation but an information session”. 

Air Malta employs some 84 pilots and the 15% wage cut could see them receiving around €20,000 less per year. They will also be expected to increase their flying hours by 20% in line with the airline’s plans to utilise its planes more. 

Industry sources said the package proposed by government is in line with industry standards for regional airlines that offer short haul flights. 

When contacted, the Finance Minister confirmed the meeting did take place but refused to confirm the details. 

“The reforms that have to be enacted are brutal and working conditions going forward are non-negotiable if we want to have a viable airline,” Caruana told MaltaToday. 

Asked whether the details will be made public, he said the business plan will be published once the European Commission gives its approval, which is expected early in the new year. 

Caruana reiterated government’s commitment that Malta will continue to have a national airline. 

The package has not gone down well with pilots and industry sources said opinion is split on the best way forward. 

“Some pilots want to adopt a militant approach and call the minister’s bluff by going to court on the basis of the side agreement they obtained from then minister Konrad Mizzi,” the sources said. 

The side agreement was signed in January 2018 giving pilots a guarantee that government will guarantee pilots a job in Malta at the same take-home pay they are earning now. 

However, others appear to be adopting a more realistic approach, in view of the possibility that Brussels could even force the closure of Air Malta to be replaced by a new airline. 

The European Commission had done the same thing with Alitalia’s restructuring when it forced the airline’s closure as part of the reform process. 

“These pilots know that if Air Malta is shut down their situation becomes more complicated and they argue it is better to cash out now rather than risk a court case that could potentially invalidate the Konrad Mizzi side agreement sometime in the future and end up emptyhanded,” the sources said. 

Any court case would put to test the legality of the side agreement, which was secretly signed by Mizzi on the fringes of a collective agreement concluded with ALPA. 

The beleaguered company needs an urgent injection of capital but government must first seek approval from the European Commission since this is considered state aid. A number of other reforms to make the airline leaner and more sustainable have already been implemented. 

The process to transfer employees from other sections of the airline to the public sector, or pay them early retirement money, is expected to start shortly. 

Meanwhile, Air Malta has ensured that more than 90% of seats were occupied over the summer months, an achievement unseen in many years.