COVID-19: Arik cuts salaries by 80%, places 90% of staff on leave without pay

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As the world battles the deadly Coronavirus outbreak that has halted social-economic activities and plunged economies world over into uncertainty and trying times, Arik Air, Nigeria’s largest commercial airline, has ordered 90% of its 1,800 staff to proceed on leave without pay until further notice.

This was disclosed in an email signed by the Chief Executive Officer of the airline, Captain Roy Ilegbolu, and sent to all staff yesterday. It stated that the suspension would be subject to monthly review.

In an internal memo obtained by Premium Times, the airline’s Chief Executive Officer, Roy Ilegbodu, informed employees that the management of the company has also decided that at least 90 percent of its workers will proceed on indefinite leave without pay from May 1. 2020.

In the memo, Mr Ilegbodu lamented that the outbreak of the pandemic has placed the company in an unimaginable financial strait that is unlikely to ease anytime soon.

He said the company revenue stream has plunged by 98 percent and the financial downturn has been made worse by the drop in the value of the naira and the dip in the price of oil.

“To date, the situation created by the COVID-19 pandemic remains dire with a high level of uncertainty, even within medical circles regarding the containment of the pandemic. Although daily updates from a few countries seem to be encouraging,

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 for a while longer.

“Of huge significance to us is that we have suffered a sharp decline of over 98% 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%

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,” he wrote.

Read the full memo below