By Christos Meliopoulos – Nicosia
Unions representing Cyprus Airways employees staged a protest rally outside the House of Representatives on Tuesday morning, as the House Finance Committee was examining the firm’s restructuring process.
The latest developments that caused the protestors’ fury were the 203 redundancy letters that were sent out in what is the first phase of the personnel reduction exercise and mainly the announcement that the company cannot pay over and above the basic legal amounts in redundancy payments. The semi-state organisation’s workers had received assurances that the redundancies would be accompanied by special compensatory provisions, which the administration now says they cannot be covered; as does the government who could potentially step in if the financial circumstances were different.
Pending a meeting with President Anastasiades, the unions have called for firm action, but have stopped short of calling a strike. As they say, they understand that industrial action might prove to be the final straw for the airline’s viability. Some of them go even further, saying that people in charge want the workers to react in extreme ways in order to precipitate the company’s closure.
The workers, already or soon to be redundant (a further 220 employees are to go by the end of September), are understandably angry at what they perceive to be a breach of agreement. But it needs to be pointed out that they have so far showed remarkable self-constraint and have proven their love for the nationally symbolic company they have served for many years.
The government’s declared goal is to maximise Cyprus Airways’ profit prospect in order to attract a strategic investor. But things could still easily go down the ugly road and Cyprus Airways is by no means out of the hook. Converging sources seem to be confirming that the concession is that Cyprus needs to maintain a national carrier. Cyprus Airways is planning some targeted promotional actions to shout out that it is still functioning despite the challenges, even if it had to reduce its flights within Greece.
At this point there seems to be no viable alternative to a strategic investor wetting his money in the risky business of a large airline. Insiders in Cyprus note that there is no need why this investor should come from abroad. Obviously the possible buyers are fewer within the Cypriot businessmen circle, but none the less promising should one of the many successful entrepreneurs be lured.
The problem in any case is whether the advertised product, the airline, will be attractive. Analysts claim that disposing of time slots in international airports abroad and the appearance of Aegean as a potential significant competitor over the connection between Cyprus and Russia are reasons to deter serious investors. However, further cooperation with big international airlines, a tighter cost of running the company and the clear support of the government could be enough to balance the investment opportunity scale.
Before all that though, the new administration and the government should not scorn the redundant workers’ dedication to the airline. If the money for the extra compensation is not there, they should look into some other kind of recognition and proof of social sensitivity.