Gov’t submits “compassionate” severance proposal for former LIAT workers

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By Kadeem Joseph

[email protected]

Land and government bonds could form part of a deal that would bring some relief to hundreds of former LIAT employees still awaiting millions in severance payment from the ailing carrier.

Prime Minister Gaston Browne recently disclosed that the government of Antigua and Barbuda is proposing to cover about 50 percent of LIAT’s severance liability.

When he was questioned about how his administration would raise the funds the PM said, “It would be a combination of cash and other instruments… We have land, we can always give a bond to cover a part of the payment. Those are things that are within our control.

“Then we will have to make a determination to see how much cash we could raise,” he added.

The carrier, which has battled financial instability for years, was grounded in June 2020 after severe losses attributed to the impact of the Covid-19 pandemic and a reported US$4 million loss in 2019.

The company also owes millions in back pay, pensions and gratuity.

Browne said that the government has already submitted the proposal to LIAT’s court-appointed administrator Cleveland Seaforth concerning what he called a “compassionate payment” on the severance liability.

“We have not heard back from the administrator as yet,” he said, noting that he is aware that Seaforth continues to hold discussions with various unions and governments of countries that LIAT has served, including shareholders, to assist in providing relief to their citizens.

“So again, we have a firm offer on the table and we are waiting until negotiations have concluded so we can move forward,” the prime minister added.

The company went into administration last July, a process that stalls the legal pursuit of severance payments owed to about 500 employees.

In a letter dated January 22, Seaforth said that as of April 2020, the total unpaid entitlements to workers across the region amounted to EC$119,006,962. Of this amount, EC$79,011,337 is in respect to the employees’ legal severance entitlements.

Browne said that there are still at least two serious investors who are showing interest in the company although there has been no formal agreement. He, however, acknowledged that the Covid pandemic has impacted negotiations.

He also disclosed that the carrier continues to lose money, with the government subsidising its operations by about half a million dollars per month. LIAT currently employs more than 100 people.

“We believe that post Covid, LIAT will become a viable business and that it will continue to provide opportunities, not only for the 100-plus people employed right now, but for additional individuals as it grows and expands,” he said.

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