Alaska Air Group has announced the layoff of about 200 non-contract level employees amid declining profits and rising expenses. The company’s Chief Executive Officer (CEO) Ben Minicucci said that if the same conditions continue, the airline could suffer a loss of up to $700 million this year. CEO Ben Minicucci said in a memo to employees that if the current financial crisis continues, it would be the company’s first adjusted pre-tax loss since 2003, barring a pandemic. The challenges in the aviation sector amid rising fuel prices and worldwide tensions are directly affecting the financial balance of the company. Impact on less than 1% of the workforce According to the company spokesperson, this layoff will affect less than 1% of the total workforce of 32,500 employees. The positions being eliminated include 125 positions in Washington state and 48 positions in Hawaii. The airline has clarified that no frontline or non-management employee will lose his job. 13th November will be the last working day, salary will be given till December. 13th November will be the last working day for the affected employees. However, the company will continue to pay them regular salary till December 31. Apart from this, the affected staff will also be given severance pay and other financial and career support. Financial pressure increased amid expansion plan. Alaska Air Group is currently expanding in the premium and international travel segments. However, despite strong revenue growth, there is clearly pressure on the company’s earnings due to the huge rise in the cost of crude and aviation fuel. In the airline industry, after increasing ticket prices and reducing flight schedules, jobs are also under threat. CEO Minicucci said that we have to return to the same financial discipline which has been our strength for a long time. He also said that in the last few years the company’s overhead expenses have increased much faster than the revenue. What happens on severance pay? When a company on its own behalf removes (retrenches) an employee from his job, the financial assistance given in lump sum or for a fixed period of time depending on his service period, contract and company policy is called severance pay. What is adjusted pre-tax loss? Loss before taxes and one-time expenses are calculated that reflect a company’s core operating performance. Also read this news… Burj Khalifa and Universal Studios tickets will be available through UPI: Now payment started in 10 countries including UAE and Singapore; Uzbekistan will become the 11th country which is good for Indians traveling abroad. Now the hassle of using international credit/debit cards or international payment gateways to book tickets to famous places like Dubai’s Burj Khalifa and Singapore’s Universal Studios is no more. Read the full news…
Source link
[ad_3]
Laying off of 200 employees in Alaska Air Group: Loss of $700 million possible this year, condition of the company worsened due to rising fuel prices.
