Bonza staff sacked as future of budget airline hangs in the balance

Administrators tasked with finding a buyer for embattled airline Bonza say they had “no choice’ but to terminate more than 300 staff.

Bonza staff have reportedly been sacked as the airline struggles to find buyer. Pictures: Darwin International Airport

Administrators tasked with finding a buyer for embattled airline Bonza say they had “no choice’ but to terminate more than 300 staff.

Bonza was placed into voluntary administration in April after lessors seized its fleet of four Boeing 737 MAX 8s, sparking chaos for passengers.

More than 300 staff were stood down while administrators Hall Chadwick tried to chart a path forward for the airline which owed millions to staff and creditors.

Despite being given an extension in the Federal Court last month to find a buyer, Hall Chadwick on Tuesday informed all staff they would be terminated.

In a statement, Hall Chadwick said it had not received any “binding offers” to buy Bonza by the June 7 deadline and said it had “no option” but to terminate staff.

“While this is not the news stakeholders wish to hear, the administrators must make a decision with respect to the stand down of the employees,” the statement said.

“Furthermore, customers need certainty regarding the operation of future flights.

Bonza staff have reportedly been sacked as the airline struggles to find buyer. Pictures: Darwin International Airport

“As a result, the administrators have no option but to terminate all employees and cancel all future flights.”

Hall Chadwick said the future of Bonza was “still be determined”, voicing hopes a third party may yet put forward a deed for creditors consideration.

A major meeting would be held for creditors to decide the future of the airline and that investigations into Bonza’s affairs were ongoing.

Transport Workers Union National Secretary Michael Kaine earlier described the lay-offs as “difficult news” for staff left in limbo after the airline’s “sudden collapse”.

“It’s a dark day for regional communities across Australia which remain isolated through unaffordable or unavailable air travel to remain connected with the nation,” he said.

TWU National Secretary Michael Kaine. Picture: NewsWire / John Appleyard

“It’s highly likely aviation will lose hundreds more skilled, experienced staff after being burnt so many times in this industry.

“The pandemic proved the industry unfit to withstand external shocks without workers, passengers and the Australian community paying a heavy price.”

Staff were not yet entitled to the federal government’s FEG scheme until Bonza went into liquidation, and were restricted if they were to resign while it was in administration.

Mr Kaine said the termination freed up Bonza staff to seek alternative full-time employment without losing their owed entitlements.

“Workers remain in limbo, with the Fair Entitlement Guarantee scheme not yet available to claim their owed entitlements,” he said.

“Today, they gained the freedom to pursue alternative full-time work, with Virgin Australia having previously committed to prioritising Bonza staff.”

More than 300 staff have been sacked from the failed budget airline Bonza. Picture: Shae Beplate.

It is understood Hall Chadwick set a deadline for last Friday for potential buyers to submit an offer, but none had been received.

News of the termination was announced during a company-wide town hall at 10am on Tuesday, which was joined by former CEO Tim Jordan.

The meeting reportedly began 15 minutes late to the frustration of the about 200 staff in attendance, who told the ABC the delay was “very disrespectful”.

Bonza launched last year as a low-cost alternative to national carriers such as Qantas and Jetstar, who scrambled to assist passengers stranded by Bonza’s sudden grounding.

Hall Chadwick reportedly told a confidential meeting of creditors last week that the sale of the airline was unlikely and that staff were set to be terminated.

It comes after the last of Bonza’s leased fleet reportedly left Australia, meaning any potential purchaser would need to acquire additional aircraft.

Originally published as Bonza staff sacked as future of budget airline hangs in the balance