Malaysia says over 2,600 Malindo Air employees affected by retrenchment plan

[KUALA LUMPUR] Malaysia-based carrier Malindo Air has launched a retrenchment exercise ranging from termination to a year's unpaid leave for 2,647 employees, the human resources ministry said on Wednesday, as the coronavirus pandemic batters the aviation industry.

Reeling from a slump in demand in the wake of travel curbs, the Malaysian arm of Indonesia's Lion Air had already ordered a 50 per cent pay cut and unpaid leave for staff in March.

"The ministry... has conducted discussions with Malindo Air's management on Nov 3 to ensure the rights of the affected workers are protected and appropriate assistance is given," said Human Resources Minister M Saravanan.

The plan unveiled on Sunday gave 439 employees notice of a year's unpaid leave, with the possibility of being hired again when the economy recovers, he added in a statement.

A voluntary separation scheme was rolled out for 347 more, while the rest received termination notices, along with the payment of minimum compensation under employment law.

Affected workers will get additional unemployment benefits and are eligible for government training and job hiring programmes, Mr Saravanan added.

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Malindo Air did not immediately respond to a request for comment.

Airline firms worldwide are struggling to keep afloat after governments grounded flights and ordered travel curbs to battle the virus.

National carrier Malaysia Airlines and flagship budget carrier AirAsia Group and its long-haul arm AirAsia X Berhad have also announced job cuts.

REUTERS