LIAT owes staff millions in severance
Over 90 million Eastern Caribbean (ECD) dollars in severance and holiday payment is owed to LIAT employees.
This was revealed by St Vincent and the Grenadines Prime Minister Dr Ralph Gonsalves during a radio interview on June 28.
Dr Gonsalves said severance payment for all workers as per the existing collective agreements is around 83.9 million dollars.
Then there are people who have vacation pay and for all the countries, so it’s about 94 million dollars.
He stated: “LIAT is insolvent it does not have any assets to pay anybody anything.”
The Prime Minister chaired a meeting on June 27 with the other major government stakeholders for the regional air carrier.
Four items were on the agenda and a report was received from LIAT’s Board of Directors and Management on the critical financial position of the airline.
A recommendation was received from the Board of Directors on the issue concerning winding up or liquidation.
It also involved taking the decision for a general meeting of all the ordinary shareholders to consider a resolution for the winding-up of the company.
Dr Gonsalves said: “The truth is LIAT was having problems before 2017. The hurricanes in 2017 put LIAT in a tailspin and into 2018. We lost millions of dollars because you could not go to several countries.
In 2019 it lost 14 million EC dollars and then COVID-19 hit in 2020.”
Dr Gonsalves said over the period with COVID-19, LIAT lost 35 million EC dollars.
The Vincentian PM said LIAT’s management submitted salaries for May, June and July and its overdue payroll liabilities.
He pointed out that although 500 workers were laid off, LIAT kept 168 people on staff across the network.
The maintenance of the aircraft, insurance, the repatriation of staff and health insurance coverage, rental of office equipment and utilities amounts to around 11 million EC dollars.
As of May 2020, LIAT also had paid bookings of US 4.3 million dollars outstanding.
Dr Gonsalves noted three of LIAT’s planes are owned by the Caribbean Development Bank.
The remaining planes which are leased will have to be sent back in due course unless a new entity which arises leases them from the lessors.
In terms of St Vincent and the Grenadines, Dr Gonsalves said he is interested in maintaining relevant connections with Trinidad and Tobago, Barbados, the Windward Islands and going up to Antigua and Barbuda.
St Vincent and the Grenadines has two airlines, One Caribbean, which the PM said served the country well during this period and SVG Air.
Moving back to the issue of LIAT, Dr Gonsalves said he wants to see the liquidation well underway and complete before he could talk about providing money for any other.
He ended the radio interview on this note: “I am making no promises or pledges to anybody concerned with LIAT because of all the legal circumstances.
I am seeking to see what could be done to assist in the most optimal movement of visitors and our people to and from St Vincent and the Grenadines.”