RIGA - Pilots of Latvian national carrier airBaltic have to become shareholders in airBaltic's subsidiary Aviation Crew Resources, Latvian daily Diena reported today.
The daily also said that dividends are a part of the salary paid to pilots.
According to the daily, in 2012 Aviation Crew Resources was registered, and its main business was recruitment of staff, but there were reports already then that the company had been established in order to optimize taxes because taxes were smaller on dividends than on wages.
Initially pilots were given a choice - to join Aviation Crew Resources or have a job contract with airBaltic, but starting from January 1, 2020, all pilots will have to become shareholders in Aviation Crew Resources.
airBaltic claims that this is a system motivating the pilots, but the Latvian Trade Union of Aviation had pointed at a number of negative aspects in the situation.
The trade union's board chairwoman Dace Kavasa said that the trade union on November 29, 2019, received an e-mail from airBaltic on liquidation of airBaltic's pilot department. "According to the information at our disposal, it refers to 42 pilots, but this information may not be 100 percent accurate," she said.
According to airBaltic, the pilots earlier employed by airBaltic do not have to sign new job agreements, the transitions are automatic, while the trade union believes that the employment terms change significantly and consultations with the trade union had to be held before the transition.
Aviation Crew Resources was registered in 2012 and has a share capital of EUR 134,540, according to Firmas.lv. The company has not reported on its shareholders and true owners. The company's turnover in 2018 reached EUR 24.497 million, while its profit was EUR 349,387.
airBaltic last year posted EUR 5.4 million in profit, while its revenue was EUR 408.7 million.
airBaltic serves over 70 destinations from Riga, Tallinn and Vilnius.
The airline's primary shareholder is the Latvian state, which holds 80.05 percent of the stock, while Danish businessman Lars Thuesen holds around 20 percent through his fully-owned Aircraft Leasing 1.