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Air Jamaica pays up NHT deductions due from 2000
Friday, January 11, 2008
NATIONAL carrier Air Jamaica has made arrangements for the outstanding National Housing Trust (NHT) deductions from its employees for the year 2000 to be made available to the Trust by today.
Bustamante Industrial Trade union (BITU), president, Kavan Gayle, told the Observer yesterday that the union received communication from the airline's management yesterday that arrangements have been made to ensure that the refunds can be accessed as of this weekend.
On Tuesday, Gayle had revealed that a letter from the NHT's Compliance Department showed that refunds from the Trust for the year 2000, which are due to the workers as of this month, could not be made because their deductions for that year were not paid over.
"Employee contributions for the year 2000 become refundable by the National Housing Trust on January 1, 2008. However, the relevant amount collected by Air Jamaica for that period is yet to be paid over to the Trust," Gayle quoted the NHT as saying in response to a request from the union for clarification of the issue.
"Be advised that until the total employee contribution collected by Air Jamaica for the year 2000 is paid to the National Housing Trust, the Trust will not make refunds to employees for the year 2000," the NHT's letter added.
In 2000, the airline was being operated jointly by the Air Jamaica Acquisition Group (AJAG) and the then People's National Party (PNP) Government. AJAG, which handed back the airline to the Government in 2004, citing political shenanigans, said Wednesday that all statutory deductions were the responsibility of the administration.
A spokesman for the Group said Air Jamaica had been experiencing cash flow problems at the time and had used the deductions to help keep the airline afloat, while it awaited overdue cash injections from the state.
The Government then agreed to make the statutory payments to the relevant agencies and convert the sums to equity in the airline. But the spokesman could not say whether the Government actually made the payments.
"That was the clear agreement by the board, which included several Government representatives. We, on our part, operated with full transparency and openness in all our dealings," the AJAG spokesman added.
"When AJAG pulled out of the partnership with the Government, it was also agreed that AJAG would be held harmless as regards any obligations held by the airline. In addition, we gave the airline US$20 million which it could have used to meet some obligations," the spokesman said.
He expressed surprise at the BITU's claim, saying that in 2005 the administration had gone to Wall Street through Bear Sterns and raised US$350 million, US$70 million of which was to be paid to the Trust.
That, too, he said, was proof that the Government had accepted full responsibility for the statutory deductions.
The BITU's Gayle said that the union had written to Air Jamaica on Tuesday making a final demand, and that failing action from the management the issue would become a "flagrant dispute".
Unionised workers at the airline have been on edge in recent days amidst rumours of redundancies as part of a restructuring of the airline.
Gayle, however, said that there was no evidence of lay-offs as both the management and the unions, including the National Workers Union, were awaiting the results of an operational audit. The audit should inform what actions will be taken to rescue the cash-strapped airline.
But he confirmed that outstanding negotiations for new labour contracts for the airline's flight attendants and ground staff have contributed to the restiveness.
"We are very concerned about the level of uncertainty at the airline, and we are calling on the board to meet with the staff and offer them an insight into their intentions," Gayle told the Observer.
Friday, January 11, 2008
NATIONAL carrier Air Jamaica has made arrangements for the outstanding National Housing Trust (NHT) deductions from its employees for the year 2000 to be made available to the Trust by today.
Bustamante Industrial Trade union (BITU), president, Kavan Gayle, told the Observer yesterday that the union received communication from the airline's management yesterday that arrangements have been made to ensure that the refunds can be accessed as of this weekend.
On Tuesday, Gayle had revealed that a letter from the NHT's Compliance Department showed that refunds from the Trust for the year 2000, which are due to the workers as of this month, could not be made because their deductions for that year were not paid over.
"Employee contributions for the year 2000 become refundable by the National Housing Trust on January 1, 2008. However, the relevant amount collected by Air Jamaica for that period is yet to be paid over to the Trust," Gayle quoted the NHT as saying in response to a request from the union for clarification of the issue.
"Be advised that until the total employee contribution collected by Air Jamaica for the year 2000 is paid to the National Housing Trust, the Trust will not make refunds to employees for the year 2000," the NHT's letter added.
In 2000, the airline was being operated jointly by the Air Jamaica Acquisition Group (AJAG) and the then People's National Party (PNP) Government. AJAG, which handed back the airline to the Government in 2004, citing political shenanigans, said Wednesday that all statutory deductions were the responsibility of the administration.
A spokesman for the Group said Air Jamaica had been experiencing cash flow problems at the time and had used the deductions to help keep the airline afloat, while it awaited overdue cash injections from the state.
The Government then agreed to make the statutory payments to the relevant agencies and convert the sums to equity in the airline. But the spokesman could not say whether the Government actually made the payments.
"That was the clear agreement by the board, which included several Government representatives. We, on our part, operated with full transparency and openness in all our dealings," the AJAG spokesman added.
"When AJAG pulled out of the partnership with the Government, it was also agreed that AJAG would be held harmless as regards any obligations held by the airline. In addition, we gave the airline US$20 million which it could have used to meet some obligations," the spokesman said.
He expressed surprise at the BITU's claim, saying that in 2005 the administration had gone to Wall Street through Bear Sterns and raised US$350 million, US$70 million of which was to be paid to the Trust.
That, too, he said, was proof that the Government had accepted full responsibility for the statutory deductions.
The BITU's Gayle said that the union had written to Air Jamaica on Tuesday making a final demand, and that failing action from the management the issue would become a "flagrant dispute".
Unionised workers at the airline have been on edge in recent days amidst rumours of redundancies as part of a restructuring of the airline.
Gayle, however, said that there was no evidence of lay-offs as both the management and the unions, including the National Workers Union, were awaiting the results of an operational audit. The audit should inform what actions will be taken to rescue the cash-strapped airline.
But he confirmed that outstanding negotiations for new labour contracts for the airline's flight attendants and ground staff have contributed to the restiveness.
"We are very concerned about the level of uncertainty at the airline, and we are calling on the board to meet with the staff and offer them an insight into their intentions," Gayle told the Observer.
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