El Al to suspend 80% of workforce, cancel most flights as virus guts business
Union offers to suspend most pilots without pay to help Israel’s flag carrier weather storm, calls on government to aid virus-hit company
El Al, Israel’s largest airline, revealed Wednesday it would soon put some 80 percent of its workforce, or 4,000 employees, on indefinite unpaid leave as the airline grapples with the coronavirus-induced wipeout of nearly all its business activities.
Every branch of the company will be affected, including management, according to internal memos reported by Hebrew media.
The suspensions will begin next week, as the airline is set to cancel most of its remaining flights.
El Al was already struggling with dramatic reductions in flights when Israel announced on Monday it was extending its quarantine requirement to travelers from all countries, effectively sentencing all travelers to a two-week home stay in a bid to slow the virus’s infiltration into the country.
Israeli travel industry representatives have warned of a “death blow” caused by Israel’s restrictive measures, which have gutted the tourism industry and left the airport and hotels as ghost towns.
On Wednesday, Prime Minister Benjamin Netanyahu announced an NIS 10 billion ($2.8 billion) package to stabilize the economy amid damage caused by the coronavirus crisis and to “allow the economy to continue to function.”
In its latest report to the Tel Aviv Stock Exchange on Wednesday, El Al said it was preparing to cancel most flights in the wake of the new restrictions. It now expects losses of between $140 million and $160 million for the period January through April 2020, double the expected losses in its report to the exchange two weeks ago.
El Al management is set to meet Wednesday to finalize the company’s efforts to survive the emergency.
The airline’s pilots union said in a statement Wednesday it would cooperate with the carrier’s efforts. The union offered a proposal for cutting the pilot workforce: of the 600 pilots working for the airline, the 60 hired most recently would be let go, another 420 would go on immediate leave without pay, and just 120 would remain on the payroll, the union said. Those who stayed would accept a 20 percent pay cut.
“The pilots’ proposal is meant to help the company in this fateful hour,” union chief Ran Elkabatz said Wednesday. “El Al’s existence and survival over the long term is dear to the pilots, the vast majority of whom served in the Air Force and still do a day a week [of reserve duty] for their country. For the first time, these pilots now expect the country to help us, with a loan to bridge this difficult period until the company is once again economically strong and growing.”
