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November 21, 2010 - Japan Airlines reported it will
layoff up to 250 pilots and flight attendants as a
result of its voluntary retirement program failed to
meet company job reduction targets. In 2009, Japan
Airlines suffered steep financial losses, despite
remaining
Japan Airlines attempted to cut 270 positions through a
voluntary retirement program, the goal was to eliminate
130 pilots and 140 flight attendants. However, the
company?s voluntary retirement target fell short when
only 20 pilots and 50 flight attendants applied under
the voluntary retirement program.
?We are in a very difficult situation with regard to
carrying out further steps to implement our
restructuring plan. We have reached the decision that we
have no choice but to dismiss personnel to achieve an
appropriate size of workforce,? said a company
spokesperson.
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After
weeks of speculation, JAL applied for court protection under
the Corporate Rehabilitation Law (the Japanese equivalent of
Administration (UK) or a Chapter 11 Bankruptcy (US) filing)
on January 19, 2010. JAL expects to receive a ?300 billion
cash injection and have debts worth ?730 billion waived, in
exchange for which it will cut its capital to zero, cut
unprofitable routes and reduce its workforce by 15,700
employees, a third of its 47,000 total.
JAL's main
creditors (Mizuho Corporate Bank, Bank of Tokyo-Mitsubishi UFJ
and Sumitomo Mitsui Banking Corporation) originally objected to
the bankruptcy declaration, but changed their mind after the
Enterprise Turnaround Initiative Corporation of
Shares of
JAL were delisted from the Tokyo Stock Exchange on February 20,
2010. Leading JAL's restructuring efforts is CEO Kazuo Inamori,
founder of Kyocera and KDDI. Japan Air Commuter President Masaru
Onishi will be promoted to president of JAL. Back in July, Japan Airlines proposed pilot pay cuts of up to 30 percent and 25 percent pay cuts for its flight attendants. The goal in part was to show its main lenders that the carrier is willing to cut pay in addition to cutting jobs. At the time the pilots and flight attendants union agreed with the carriers move to cut pay if it meant saving the company. |