Keep Air Jamaica in local hands, union boss pleads

BY HG HELPS Editor-at-large editorial@jamaicaobserver.com

Monday, January 25, 2010

EVEN as a deal for the takeover of Air Jamaica by Caribbean Airlines seems imminent, a senior trade unionist here is beseeching the Jamaica Government not to go ahead with the deal.

Vincent Morrison, who heads the powerful National Workers Union (NWU), insists that Air Jamaica should be kept in local hands, and believes that the 1,900 workers at the national carrier are more than equipped to run the troubled airline that racked up huge losses over the last four decades of its existence.

"I can't believe that the Government would spend $28 billion to give away one of our best assets," Morrison told the Observer in an interview.

The NWU president was referring to the amount of money that the Government has said it would cost to make the positions of workers redundant when the airline is divested.

Although the Government has not confirmed that a deal has been inked with Trinidad & Tobago-based Caribbean Airlines, Prime Minister Bruce Golding has said that talks were underway and the Government hoped to conclude the agreement soon.

Jamaica is seeking to borrow US$1.25 billion from the International Monetary Fund under the agency's Standby Arrangement for balance of payment support, and among the conditions is the divestment of loss-resulting entities like Air Jamaica, for budget relief.

"We are going to communicate with the Government both in writing and hopefully in a meeting to know the status of the discussions with Caribbean Airlines," said Morrison, whose trade union represents some of the workers at Air Jamaica.

"We hope to convince the Government that selling out to Caribbean Airlines is not the best," Morrison said.

The NWU's strategy is have the Government write off the debt, which is estimated to reach US$1.4 billion, by the end of the fiscal year in March, something which, according to Morrison, would be offered to Caribbean Airlines.

The airline would be run under the Employee Share Ownership Plan or ESOP, a sophisticated stock ownership, which would see 100 per cent ownership falling into the hands of workers.

ESOPs are not common in Jamaica, but figures show that they are becoming increasingly popular in the world's leading economy, the United States where over 11,000 ESOPs, involving over nine million workers have been operating since 1974.

"The workers are saying to the Government: put the legacy into a fund from which the workers would be prepared to use their redundancy payments to run the airline. We would also be looking to float an IPO (Initial Public Offer) to involve Jamaicans at home and in the Diaspora, where we ask Jamaicans abroad to invest. Apart from getting a Paul Getty or someone with big money, that's how you have to go," Morrison said.

"Caribbean Airlines does not have the capability, logistically and operationally, to deal with running Air Jamaica," he said. "If Air Jamaica is taken over by Caribbean Airlines, you could see a tremendous fallout in the Jamaican economy. Air Jamaica contributes $6 billion to the economy. We have 12,000 farm workers in Canada and the USA who send back to Jamaica in excess of Can/US$100 million, taken out of their pay compulsory.

"There are also between 4,000 and 5,000 hotel workers who do the same thing. If you don't retain Air Jamaica, all of this would be compromised. Getting rid of 1,900 Air Jamaica employees would also indirectly affect the jobs of a further 10,000, plus there are other issues involved," Morrison said.

Members of the Jamaica Airline Pilots Association have also proposed that the Government use a portion of the funds being set aside for redundancy to recapitalise the airline and put it in a position to live on its own.

Morrison is firm in his view that if the workers are allowed to run the entity as their own, there would be a turnaround in its economic fortunes.

"Air Jamaica has never been properly capitalised since its inception. The workers over the years have made sacrifices. Some have worked for five years and more, without salary increases.

"Some have given back to the airline, in terms of salary cuts, so the commitment and love for the airline are there. The redundancy money could be used to recapitalise the airline.

"The brand Air Jamaica is golden. That would be gone if Caribbean Airlines takes over. The Air Jamaica brand is like Usain Bolt in terms of quality and this country should not give that up," Morrison said.

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