AirBaltic in Union Talks for Job Cuts After Filing for Chapter 11 Bankruptcy

Latvian airline AirBaltic is negotiating with labor unions over potential workforce reductions after voluntarily filing for Chapter 11 bankruptcy protection in the United States, CEO Erno Hilden told Reuters on Monday. The move is part of a broader strategy to restructure the company's debt and navigate a sector-wide crisis.

Restructuring and Workforce Reductions

AirBaltic filed for protection under Chapter 11 of the U.S. Bankruptcy Code in New York as it seeks to reorganize its finances and hold off creditors. Hilden stated that as the airline plans to reduce its capacity, an "adjustment in the workforce" is a "natural conclusion."

"We are currently carrying out the consultations with the labour unions," Hilden said, adding that specific numbers on potential dismissals will be determined once those talks conclude. Hilden previously served as CFO for Scandinavian Airlines, where he managed a similar bankruptcy process.

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Union Negotiations and Operational Impact

Despite the restructuring, Hilden assured that AirBaltic’s flight operations are expected to continue without interruption. The most significant changes are anticipated in the carrier's "wet lease" business, which involves leasing its aircraft and crew to other airlines.

Dace Kavasa, chairperson of the Latvian aviation union, confirmed to Reuters that talks are ongoing. The union is proposing "alternative employment solutions," such as part-time arrangements, but noted there are still "serious disagreements on the objectivity of some proposed criteria" for the dismissals. Kavasa said the union hopes for constructive decisions by the end of the week.