Airport Health Authorities officers get ready to disinfect a Lion Air Boeing 737-800 at Soekarno-Hatta International Airport. (JG Photo/Yudha Baskoro)
Lion Air Lets Go of 2,600 Workers as Pandemic Pressure Intensified
BY :THRESA SANDRA DESFIKA
JULY 06, 2020
Jakarta. Lion Air Group, Indonesia's largest airline group by fleet size, has decided to slash 8.9 percent of its workforce to keep the group afloat during the Covid-19 pandemic, the company spokesman said on Monday.
The group, which includes budget airline Lion Air, propeller plane airline Wings Air and full-service airline Batik Air, decided not to extend the contract of 2,600 workers that end recently. Before the cut, the group employed about 29,000 people across Indonesia.
Danang Mandala Prihantoro, Lion Air Group's spokesman, said the group had to take the decision to ensure business continuity amid the pandemic.
"That was not a termination of employment, but a reduction in the labor force as the work contract expires and is not renewed," he said.
Lion Air said it planned to rehire the employees should the company recover in terms of business, operations, and income level. "The employees will be prioritized to have the opportunity to return to work at Lion Air Group," added Danang.
The layoff was part of Lion Air's effort to reduce expenses and restructure its organization as flight operation has yet to return to a normal level, Danang said.
Lion Air was also renegotiating with its business partners and since March the group has cut the salary of its management and employees with varying degrees — the greater the income the greater the salary cut, Danang said.
The group decision came after rival Garuda Indonesia, the country's flag carrier, decided to lay off its pilots last month, following a sharp decline in the number of air travel passengers amid restrictions imposed by the government to curb Covid-19 spread.
The number of domestic air passengers dropped to 87,000 in May, 98 percent lower than the same month a year ago, according to data from the Central Statistics Agency. There were only 11,700 passengers on international routes in May, 55 percent lower than last year.