TAP to slash staff and salaries in a bid to save the airline

The senior management at Portugal’s national airline TAP is to slash staff salaries by 25% in a bid to save the company from going under.

They say that the company must make “heavy and across-the-board cuts to avoid the end of TAP” as flight numbers crashed by 70% for the period January to September this year.
Unions have suggested this means up to 2000 jobs could be affected, including 750 cabin crew, 500 pilots and a further 750 staff all facing the axe.
The cuts come as TAP announced that it had lost €700 million to September 2020, with the pandemic severely affecting the airline’s accounts over the summer to the tune of €118 million. The airline had posted losses of €585 for the first six months of the year.
By the end of the year TAP is expecting to lose €1Bn for 2020 as government confinement restrictions continue throughout December.
The savage cuts are part of TAP’s restructuring plan which will see salaries slashed by 25% throughout the company so as to reduce fixed costs.
These were the sweeping measures part of a major restructuring plan agreed with the government in return for an emergency cash injection of €1.2Bn taxpayers’ money to keep the airline in the air.
They were announced by the company on Friday to the unions by Ramiro Sequeira, interim executive president of TAP and chairman of the board, Miguel Frasquilho.
The restructuring plan has to be delivered to Brussels by 10 December and will also include a considerable reduction in the airline fleet and is seen as the minimum required to make the airline viable and which will be supervised by the European Commission.
But the unions say that there are alternative measures that could be taken which could save jobs and minimise the total number of redundancies stating “it is not salary cuts and redundancies that will save TAP, but rather an intervention of a financial nature that will finance the company in the years to come and given that the plan has yet to be finalised, there is still time to repair this situation.”
The unions want to have a say in the restructuring plan but the Government’s way of seeing things is simple: Without this restructuring, TAP will close.