The United Arab Emirates (UAE) will shut down passenger services for its national carrier – one of the world’s largest airlines to fall victim to the economic effect of the new coronavirus.
The Dubai-based carrier says the decision was made to preserve business viability and to ensure there were no job losses.
Emirates Group said in a statement Sunday that it will not cut jobs, but will implement a temporary reduction in basic salary for the majority of its employees for three months, ranging from 25% to 50%.
“As a global network airline, we find ourselves in a situation where we cannot viably operate passenger services until countries re-open their borders, and travel confidence returns,” Emirates Group chairman and CEO Sheikh Ahmed bin Saeed al-Maktoum said in Sunday’s statement.
“By Wednesday 25 March, although we will still operate cargo flights which remain busy, Emirates will have temporarily suspended all its passenger operations. We continue to watch the situation closely, and as soon as things allow, we will reinstate our services.”
Cost-cutting measures being undertaken by the group beyond the salary cuts include postponing or canceling discretionary spending, freezing all non-essential recruitment and consultancy work, encouraging employees to take paid or unpaid leave, and a 100% basic salary cut for Emirates and airport services provider dnata’s presidents Tim Clark and Gary Chapman.
On the decision of the basic salary cuts, Sheikh Ahmed said, “Rather than ask employees to leave the business, we chose to implement a temporary basic salary cut as we want to protect our workforce and keep our talented and skilled people, as much as possible. We want to avoid cutting jobs. When demand picks up again, we also want to be able to quickly ramp up and resume services for our customers.
There are 153 confirmed cases in the UAE, of which 38 have recovered.
The death toll there stands at two.
