Sources close to the airline said the step was taken following discussions and review of the carrier’s operations for the month of April 2020 by the management.
Similarly, it was discovered that at least 90% of Arik Air’s workforce would begin leave without pay from 1st May until further notice.
According to the source, the decision would be reviewed monthly and the Human Resources department would communicate new developments as the situation evolves.
“While we are not unaware of the challenges that each and every one of us may face during this difficult period, we join you in remaining hopeful that this ugly situation will abate in the shortest possible time and our organisation will come out stronger in the long run.
“We are confident that the steps we are taking now are in the best interest of all and will see us through this difficult epoch in the history of mankind,” a statement from the airline said.
The source observed the current unfavourable circumstances triggered by the COVID-19 pandemic were not anticipated some months ago as the dire situation led the carrier to take the decision.
The document further read: “our situation in Nigeria appears to be getting worse. With the current observed trend of events, it is prudent to lean on the assumption that the situation is likely to persist a while longer.
“Of huge significance to us is that we have suffered a sharp decline of over 98 per cent in our revenue streams since the suspension of our scheduled flights almost four weeks ago.
“Added to this is the rapid decline in the value of the naira by over 35 per cent against the benchmark, and with oil prices now falling well below $15 per barrel, it is evident that we must, without further delay, take decisive action to preserve our organization.”
Staff of the airline were handed two memos on Friday by the company’s HR department.
The first stated that the firm’s health insurance scheme through Health Management Organisations (HMOs) would continue to operate in the course of the compulsory leave.
The second noted that the airline’s charter operation staff were exempted from the restructuring while the rest had been placed on leave without pay.
In February 2017, the Asset Management Corporation of Nigeria (AMCON) had taken over the carrier after it was deemed incapable of repaying its debts of over N300 billion to AMCON, other creditors in the country and other parts of the world.