As of May 1, Air Jamaica and Caribbean Airlines will implement a transition plan, which will see the lovebird continuing its operations under agreements with the Trinidadian carrier.
With negotiations now complete, the airlines are to formally sign a number of agreements to cement the deal, on Friday (April 30), Chairman of Air Jamaica, Hon. Dennis Lalor told journalists at a press conference at the airline’s downtown Kingston head offices, today (April 28).
This transition period is expected to last from six to 12 months, after which Caribbean Airlines will “fully enforce its plan to provide a sustainable airlift from Jamaica,” he said.
The Jamaican Government will transfer to Caribbean Airlines, Air Jamaica’s routes, for a 16 per cent ownership in Caribbean Airlines. However, Mr. Lalor pointed out that, “the Government of Jamaica remains the owner of all of Air Jamaica’s other assets, including its real estate assets and industrial assets.” He added that this deal is “superior” to what was contemplated with the other bidder in the divestment process, Indigo Partners.
Chairman of Air Jamaica, Hon. Dennis Lalor (second right), updates journalists about Air Jamaica’s negotiations with Caribbean Airlines, at the national carrier’s head offices in downtown Kingston, on April 28. Also participating in the press conference (from left) are: Project Manager, Air Jamaica Divestment, Mr. Dennis Chung; President and Chief Executive Officer (CEO) of Air Jamaica, Mr. Bruce Nobles; and Director of Caribbean Airlines, Mr. Shafeek Sultan-Kahn.
Initial operations will see Caribbean Airlines continue serving routes from: JFK to Montego Bay, JFK to Kingston, Baltimore to Montego Bay, Philadelphia to Montego Bay, Toronto to Kingston, Fort Lauderdale to Montego Bay, and Fort Lauderdale to Kingston. Plans for other routes are to be announced by Caribbean Airlines.
All of Air Jamaica’s financial responsibilities will be turned over to Caribbean Airlines, which the Chairman said, “has the adequate financial strength to sustain their commitment to Jamaica.”
In this regard, the Government of Trinidad and Tobago has agreed to increase Caribbean Airlines capital by US$50 million. This move, Mr. Lalor said, provides adequate assurance to the Divestment Committee that enough funding will be available for the project.
Mr. Lalor stressed that there will be no disruption of service, as all tickets issued will be honoured. Some US$9 million has been set aside to deal with refunds for advance ticket sales.
Also on Friday (April 30), all redundancy and other payments due to workers will be made, amounting to US$24 million. Some 1,000 employees are to be rehired by Caribbean Airlines during the transition period. “These employees have already been identified and have been given the opportunity to work with Caribbean Airlines,” Mr. Lalor informed.
He noted that staff should face no economic disruptions, as the government has assured that arrangements have been made to take care of statutory payments.
The categories of workers who will be rehired by Caribbean Airlines include 200 flight crew, with the remainder being ground and maintenance crews.
Meanwhile, Director of Caribbean Airlines, Mr. Shafeek Sultan-Kahn said certain criteria had been used to select staff who are to be rehired.
In relation to the trade unions, Mr. Sultan-Khan said: “We have been criticized for not meeting with unions (but).it would be presumptuous of us to make any representation with the unions, for one simple reason – we have no workers as yet. Air Jamaica is still the employer until the 30th of April. We are in the process of making employment offers, and that process is going to go on today and tomorrow.”