• Retirement scheme to reduce 500 employees proposed to Govt.
• Move comes after 900 contracted and outsourced staff sent on no-pay leave for 3 months and maximum 25% pay cut for permanent cadre earning above Rs. 100,000
• Achieves $ 30 m saving from renegotiating or cancelling supplies contracts
• Chairman says leaner and efficient airline key for future success in volatile aviation industry

SriLankan Airlines has secured a saving of $ 30 million per annum via multiple measures on human resource management amidst the impact from COVID-19.

Measures included a maximum pay cut of 25% for three months for those earning above Rs. 100,000 per month; release of 400 contracted employees including pilots on no-pay leave and a further 500 from outsourced services. The monthly salary bill of the national carrier is now estimated at $ 7 million.

Chairman Ashok Pathirage said that so far not a single staff from the permanent cadre (of 6,000) has been laid-off and pay cut formulae was far favourable than that in the private sector.

“We like to retain all our employees (around 7,000 Group-wide), but with COVID-19 triggering a drastic reduction in our operations we have many redundancies. We will be able retake those who are on no-pay leave when operations are restored to optimum level in the future,” Pathirage told journalists.

Given the challenges to remain lean and efficient amidst dwindling revenues, the national carrier is planning a Voluntary Retirement Scheme (VRS) aimed at shedding around 500 permanent employees. “This is voluntary and we will have to fund the VRS as well,” the Chairman added.

Whilst acknowledging that SriLankan is fortunate to have a professional team, Pathirage said that COVID-19 has heralded a good opportunity for the airline to restructure its operations to be lean and more efficient. Such an outcome, he noted will enable the airline to sustain if not enhance its contribution to the nation and the economy.

The airline is also realigning its senior management team to achieve better results in the new norm post -COVID.

SriLankan CEO Vipula Gunatilleka said the airline has also secured $ 30 million savings by renegotiating or cancelling various contracts given the post-COVID challenges. 

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