News: BWIA to be replaced by Caribbean Airlines

(TG 09/09/2006) Port of Spain - National airline BWIA will cease operations on December 31, 2006, after 66 years of service. It will be replaced by a Government-approved regional airline—Caribbean Airlines—which is officially expected to begin operating on January 7, 2007.

“Caribbean Airlines will have its base at Piarco, the international airport of Trinidad, and will, subject to local and international regulatory approval, commence operations early in 2007,” the airline said in a press statement.

“It will provide regional air transport within the Caribbean and between the Caribbean and major international cities. BWIA will continue uninterrupted service to its valued customers whilst management ensures a seamless transition to Caribbean Airlines,” the statement read.

But even as the BWIA management mark the “exciting phase in air travel and aviation history in T&T and the region,” unions were left with 14 days to negotiate voluntary packages (VSEP) for its workers.

Shafeek Sultan-Khan, BWIA’s legal and management consultant, said if negotiations were not completed by September 26, workers would not exact any VSEP benefit.

He said the airline had three options—the restructure of BWIA with its new mandate, which failed, and was now on its second option, attempting to close BWIA through VSEP.

“In facing this challenge, the reality is if we are unable to achieve this objective, it will inevitably lead to the first option, which is the closure of BWIA without enhanced severance benefits under the VSEP proposal,” he said.

He was speaking to reporters at a meeting between BWIA and its unions held at the Crowne Plaza, Wrightson Road, Port-of-Spain, yesterday.

But two of the four representatives did not agree with the timeframe set for them.

Clive Weatherhead, a representative of the Communications, Transport and General Workers’ Trade Union, said the timeframe was too short to properly negotiate VSEP.

“We have been negotiating for months and the collective bargaining has not been done in good faith,” he said.

Curtis John, president of Allied and Communications Workers’ Union (ACAWU), said he intended to set up meetings as early as next week to negotiate VSEP and other outstanding court matters with the company.

He said the company asked that workers engage in a seamless transition, but he could not grant the assurance.

“I cannot decide. I don’t know how my people will react. I will do my best to keep things calm as we negotiate and let good sense prevail,” he said.

John said he was disappointed that all the contracts the union now had with BWIA, like travel benefits for workers, would be terminated.

Last month, BWIA’s chief executive Peter Davies confirmed the Government’s decision to privatise the airline which was in line with his mandate to provide a safe, effective and profitable carrier to connect the Caribbean with the rest of the world.

The Government has already injected more than US$250 million for BWIA’s restructuring.

In June Cabinet approved an additional US$100 million to meet the equity injection in the recapitalisation of the airline.

Despite months of negotiations, BWIA and its unions failed to reach agreement on the restructuring of the airline. This led to chairman Arthur Lok Jack requesting Davies to present a report to the board with his analysis and professional recommendation as to the airline’s future viability.

Last November, BWIA board requested that the Stock Exchange suspend trading of its shares for a three-month period.

Sultan-Khan said BWIA would hold meetings with shareholders—less than three per cent—to discuss options.

All tickets already purchased for travel on BWIA will be honoured by Caribbean Airlines and BWEE Frequent Flyer air miles and Club BWEE memberships will transfer and qualify on the new airline to ensure customer continuity and confidence, the company said.

It said eligible BWIA employees will also be given the opportunity to apply for positions with Caribbean Airlines.

Davies said the mandate he received through the board allowed him, the management and staff of BWIA, to recognise the dynamic changes that are affecting the global airline industry and to position Caribbean Airlines in an ever increasing competitive context.

“We are looking to the 21st century whilst being empathic to our historical past; determination, passion and focus will allow us to build a future and respond honourably to the loyalty that customers have demonstrated over the years,” he said.