Arik Air CEO, Capt. Roy Ilegbodu
Arik Airline managed by Asset Management Corporation of Nigeria (AMCON) during the week sent an internal communication to its workforce, which announced 80 per cent cut in the salaries of all categories of staff and placed 90 per cent of workers on leave without pay from April. But unlike other airlines across the globe that are sacking staff and going into administration, we gathered that the Arik decision is temporary pending when the lockdown cause by the ravaging Coronavirus (COVID-19) pandemic is called off.
The internal memo, which leaked to the media showed gross staff disloyalty to the Arik brand by its workforce most of who ought to have been out of work as far back as 2017 if AMCON did not intervene in the airline. Arik was going down under heavy debt burden owed AMCON and other establishments before the government agency rescued the airline. According to the internal memo, the decision of the Nigeria’s biggest carrier was informed by the downturn in operations due to restrictions placed on flight both global and domestically by aviation authorities.
We gathered that beginning from next month (May) that is, if the lockdown occasioned by the deadly Coronavirus (COVID-19) continues, Arik has ordered around 90 per cent of its workforce to proceed on indefinite leave without pay, a fall out from the ravaging impact of the deadly coronavirus pandemic. The affected staff were told to look out for further directives from the company as operational conditions improve.
“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 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,” Arik wrote in the said memo to staff.
The statement stated further, “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,” the company said.
When we called Mr. Jude Nwauzor, Head, Corporate Communications Department of AMCON to authenticate the story, his mobile phone rang out. However, Arik is not the only airline that is facing similar dilemma as most airlines across the globe are grounded at the moment with their staff also dormant but because of the strong oath of secrecy in those airlines, similar memos to them did not make it to the media like the case of Arik.
It would be recalled that only last week, the International Air Transport Association (IATA) estimated global airline losses from the impact of coronavirus pandemic to rise by 25 per cent to $314 billion owing to the severity of the economic downturn and a slower than previously expected reopening of international routes. Nigeria’s aviation industry is yet to come out with its estimate and the extent of the impact of the outbreak and subsequent shut down on its operations. AMCON led by Ahmed Lawan Kuru as Managing Director/Chief Executive Officer intervened in Arik in February of 2017.