SEOUL, South Korea – South Korea’s flag carrier Korean Air will put 70% of its 19,000 staff on furlough, it said, as it scrambles to cope with the coronavirus pandemic that has brought global aviation to a standstill.
Korean Air is the flagship of the Hanjin group, one of the multifaceted, family-controlled conglomerates known as chaebols that dominate business in South Korea and played a key part in its rise to become the world’s 12th largest economy.
Most of its staff will go on leave from April 16 for 6 months in response to “deteriorating business circumstances,” Korean Air said in a statement.
According to normal South Korean practice, the workers will receive 70% of their normal pay, with most of it – reportedly up to 90% – funded by a government scheme for industries in need of special assistance due to the coronavirus.
Korean Air’s labor union agreed to participate as part of a “burden-sharing” initiative, the company said – executives have also agreed to take pay cuts.
The furlough measure comes after a months-long battle for control of the company between members of its founding Cho family.
Cho Hyun-ah, who had made global headlines for a “nut rage” scandal when she forced a taxiing plane back to the gate over a bag of macadamia nuts, sought to oust her brother Cho Won-tae from the chairmanship.
The brother fended off the challenge, winning 56.67% support in a shareholder vote last month.
The Hanjin group was in financial trouble long before the coronavirus outbreak wreaked havoc on airline finances worldwide – subsidiary Hanjin Shipping was once one of the world’s top 10 container lines, but went bankrupt in 2017. – Rappler.com