Malaysia Airlines Announces Mutual Separation Scheme

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Malaysia Airlines Announces Mutual Separation Scheme

By | September 2010
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MALAYSIA AIRLINES ANNOUNCES MUTUAL SEPARATION SCHEME TO RIGHTSIZE WORKFORCE

Malaysia Airlines today announced the details of its Mutual Separation Scheme (MSS). This fast tracks the organisation’s intention to right size(downsize) its workforce a year ahead of the schedule outlined in its publicly announced 3-year Business Turnaround Plan.

Malaysia Airlines will receive compensation from Penerbangan Malaysia Berhad (PMB) for the termination of the Agreement for Domestic Business Unbundling. Under the terms of the contract, Malaysia Airlines is required to be given 12 months’ notice, or be given compensation in the event of a termination. The cost of the MSS will be funded by the compensation.

Since the MSS is a voluntary exercise, Malaysia Airlines expects the take-up rate from staff to be between 3,000 to 5,000.

Over the past few weeks, Malaysia Airlines has had numerous discussions with employee unions and associations on the terms and conditions of the MSS. The MSS will be extended to all permanent and confirmed employees in Malaysia and locally recruited Malaysian staff posted overseas.

18,027 invitations will be sent today, Monday, 22 May 2006, to eligible employees who have till 7 June 2006, a period of 14 days, to make a decision.

“We are committed to conducting this rightsizing exercise in the most compassionate way possible by working out terms and conditions which are attractive to our employees. We have also tasked key executives with ensuring that there are no service disruptions nor compromising safety and service quality. Throughout the exercise, we want to ensure that our customers’ needs are being taken care of”, said Idris Jala, Managing Director, Malaysia Airlines.

Employees whose MSS applications have been approved, will receive payment based on their current monthly salary, ranging from 1 month to 3 months, for every year of service in the company, a one-off medical benefit payment of RM 2,000 per staff and annual...

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