Latvian carrier airBaltic has announced plans to cut between 500 and 700 jobs across several of its bases. The move is part of a comprehensive financial restructuring process initiated after filing for U.S. bankruptcy protection, aimed at curbing operational costs and debt.
Financial Restructuring and Workforce Reductions
Last September, the airline formally filed for protection under Chapter 11 of the U.S. Bankruptcy Code in New York. The legal maneuver is intended to execute an all-encompassing restructuring aimed at paring down its mounting debt through scheduled reductions in both operating capacity and aircraft fleet size.
As part of the financial backing during these proceedings:
- Approved Financing: Last month, the carrier secured approval to access 140 million euros (approximately $157 million), part of a broader financing facility valued at 350 million euros.
- Affected Bases: Headcount reductions will directly impact its three main Baltic operating hubs: Riga (Latvia), Vilnius (Lithuania), and Tallinn (Estonia).
The carrier’s Chief Executive Officer, Erno Hilden, told Reuters in September that the airline was in talks with labor unions to agree upon a workforce “adjustment.”
Implementation Timeline and Union Tensions
Management anticipates that the new organizational structures across the rest of the company will be finalized by mid-October. However, airBaltic noted that the final tally of departures could fluctuate as the process unfolds.
For their part, labor representatives have voiced fierce opposition to the rollout of the plan:
- Union Pushback: Dace Kavasa, president of the Latvian aviation trade union, denounced what she termed “pure union busting” to Reuters after management dismissed a counterproposal from workers to introduce an 85% part-time working arrangement.
- Notices and Timelines: Kavasa stated that she learned of the projected 500 to 700 layoffs just six minutes prior to the start of the employee meeting where the measure was announced, further noting that formal consultations are set to begin on October 15.
The rollout of the new internal corporate structure in the middle of this month and the launch of formal negotiations with trade unions on October 15 will determine the trajectory of labor relations, as airBaltic seeks to secure the long-term viability of its operating model under Chapter 11 court supervision.
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