Hundreds of employees of Lebanon's state-owned Middle East Airlines (MEA) resumed Monday, June 25, a sit-in at the company's headquarters, as chairman Mohamad Hout stood firm on plans for mass dismissals at the loss-making carrier.
Hout also warned that the company might also be forced to present a statement of affairs, a step on the way to bankruptcy.
"We will then be forced to suspend payments, a matter which will endanger the future of all employees," he said at a press conference at the MEA headquarters in Beirut, heavily guarded by anti-riot police.
"The restructuring plan will not be reconsidered. If the dismissed persons do not accept the notification by June 30, they can resort to justice," Hout said.
"But they will lose the 36 months of additional indemnities we are offering them and would only get a maximum of 12 months according to the law on forced dismissals," he warned.
Hout said the airline was currently losing $40 million each year despite a decrease in activities and a reduction of the fleet since 1996. "We cannot continue at this pace," he said. Meanwhile, hundreds of MEA employees had gathered in front of the headquarters, which was ringed by steel fences.
They were backed by a number of members of parliament representing pro-Syrian political parties, and the head of the president of the General Confederation of Workers trade union, Ghassan Ghosn.
Ghosn told the protestors that labor syndicates had given the company 48 hours to make goodwill gestures "before deciding to escalate action." He did not elaborate. MEA employees held similar sit-ins on Thursday and Friday in front of the company's headquarters on the edge of the Beirut International Airport.
Pilot Ali Sabbah told AFP that the syndicates of MEA "are not against a restructuring of the company, but they reject dictates."
He called for the creation of a special commission to rule on the matter "in conformity with the recommendations of the private consultant, the International Finance Corporation (IFC), upon which the management based its restructuring plan."
MEA has only nine aircraft, all leased, but employs 3,500 people. Prime Minister Rafiq Hariri had announced on May 12 plans to sack workers at the airline, but did not say how many. At the time, Hout spoke of 1,200. The dismissals mainly concern ground personnel and about 10 percent of the 140 pilots, according to the syndicates.
In 1996, the Central Bank of Lebanon (CBL) acquired 99 percent of MEA, which was on the brink of financial collapse. Since then, the state has pumped $360 million into the company to keep it going. The Lebanese press has spoken of a further $100 million required for redundancy payments.
Sources close to the CBL said that the central bank can only support MEA until October if the restructuring plan foils. Experts said the restructuring plan was a test for the Hariri government's capability to reduce the ever-growing budget deficit and public debt.
The government's budget for 2001 has a deficit of 50 percent. Public debt reached $25.2 billion at the end of March, or 150 percent of the Gross National Product which remains one of the highest rates in the world. —(AFP)
© Agence France Presse
© 2001 Mena Report (www.menareport.com )