The German Lauda employees in Düsseldorf and Stuttgart will definitely look in vain for their May salary on their checking accounts, because the company announced on Thursday that they are no longer able to pay this. Human Resources Director Robert Wall announced on May 15, 2020 that such a step could be imminent - Aviation.Direct reported.
In a cover letter available to AviationNetOnline and signed by Iluta Svicka, Head of HR, the main reason given is the application for short-time work that was rejected by the Federal Employment Agency. It is also pointed out that losses of 200 million euros have been accumulated in the last two years and that there has been no significant income from ticket sales since March 17, 2020.
The behavior of the Federal Employment Agency in Würzburg is described as illegal in the letter to the Lauda employees in Düsseldorf and Stuttgart. Attempts at clarification have so far not been successful. The company lawyers have now been commissioned to bring lawsuits against the legal entity of the Federal Employment Agency. One does not expect a quick solution. The employees were not given a possible payment date.
German Lauda employees should urgently think about a Hartz IV application for their own protection
This has considerable consequences for the employees of the Lauda airline, because they are not entitled to unemployment benefits or insolvency payments, as their employment relationships have not been terminated, nor have they started going to the bankruptcy judge. The only thing left for those affected is the so-called job center and the humiliating request for support from the Hartz IV funds. In Germany, these are not only lower than the Austrian needs-based minimum income, but are also linked to tough criteria, so that pilots in particular may not get anything at all.
It is precisely this professional group that does not want to put up with the approach of the Austrian company. Numerous German Lauda pilots definitely have previous experience with airline insolvencies, as many previously flew with Air Berlin, Niki, Germania or Small Planet Germany. Several pilots announced that if their salaries were not paid, they wanted to file a criminal complaint against the managing directors on suspicion of bankruptcy deferral and because they would also be forced to file for bankruptcy against the company. The hope lies in a so-called hard letter of comfort that was given by Ryanair Holdings PLC for its subsidiary Laudamotion GmbH. Of course, it remains to be seen whether these announcements will actually be implemented. The Air Berlin case showed that "hard letters of comfort" in the worst case may not be worth the paper on which they are printed. Etihad simply did not pay and insolvency administrator Lucas Flöther has so far not been able to persuade the state carrier of Abu Dhabi to pay through his damage claim.
Lauda boss Andreas Gruber hopes that “it can be paid out as quickly as possible”
In an interview conducted on Thursday by Aviation.Direct with Lauda Managing Director Andreas Gruber, the following question dealt with the situation in Germany:
Lauda managing director Andreas Gruber.
We are in ongoing discussions with the Employment Agency regarding short-time work for colleagues stationed in Germany. We sincerely regret the action taken by the Würzburg Employment Agency, which has revoked the promise of short-time work. This happens in the worst economic crisis in the history of aviation, although our colleagues stationed in Germany live in Germany, work there and pay their social security contributions in Germany. We have appealed against the decision and due to the ongoing legal proceedings I cannot comment on the content. The salary payment for May is unfortunately late, but will be paid out as soon as possible.
Lauda is not the contractual partner of the ticket buyer, but Ryanair
Incidentally, Laudamotion GmbH does not sell flight tickets itself, rather the distribution is carried out entirely through Ryanair DAC, a sister company of Lauda. When booking, the contract of carriage is concluded with Ryanair DAC and not with Laudamotion GmbH. This company also issues the bills and collects the funds on their own behalf from credit cards and other means of payment. The Ryanair DAC is the operating airline Ryanair. Like Lauda, this is a subsidiary of Ryanair Holdings PLC. The sister company Buzz is also wholly owned by the holding company. Malta Air, on the other hand, is a minority stake because the State of Malta owns the “golden share” and thus the majority. Ryanair has another subsidiary in the United Kingdom. This serves as “Brexit protection” and currently only has one Boeing 737-800 on the AOC.