Bonza workers sacked and future flights cancelled after no offers materialise for airline with no planes

Bonza’s administrators have sacked employees and cancelled future flights despite ongoing talks with ‘interested parties’.

Bonza is now an airline with no planes, no employees and a mountain of debt after administrators terminated all 323 staff but claimed they were still talking to “interested parties”.

In a decision that infuriated workers who have not been paid for two months, Hall Chadwick partner Kathleen Vouris said the termination of staff was intended to provide “certainty”.

However Ms Vouris said employees would be unable to access what they were owed through the fair entitlements guarantee scheme until a decision was made to liquidate — and administrators were “not there yet”.

“A deed of company arrangement can still occur,” Ms Vouris told an emotional creditors meeting on Tuesday.

“We will be working closely and as fast as we can to determine whether there is a proposal and we can put that forward to employees and creditors to decide the future of the company.”

As well as terminating workers, Hall Chadwick announced the cancellation of all future flights to give customers “certainty”.

The last Bonza aircraft flew out of the country last week, following a midnight repossession by lessor AIP Capital on April 29 which tipped the airline into voluntary administration.

Despite administrator’s claim more than 20 parties had shown interest in Bonza, Ms Vouris told employees no offers were received by last Friday’s deadline.

She said the next step would be to prepare a creditors’ report, and convene a meeting which was expected in a couple of weeks.

Asked why the meeting could not be held sooner, Ms Vouris said they wanted to “give interested parties an opportunity to come up with a proposal that could be a better result that a liquidation”.

The comment sparked an angry response from employees desperate to be paid and move on.

“It just seems like you’re dragging it out, the deadline has been and gone, get on with it, wind this up and be done with it,” said a Bonza employee.

“What you’re saying about reaching out to parties after the deadline is baffling. It just seems you’re dragging it out.”

Ms Vouris said the administrators were obliged by the Corporations Act to seek the best outcome for all creditors, not just employees.

Hall Chadwick was also taken to task by employees about the lack of communication throughout the administration process with one worker describing the situation as “horrendous”.

Another asked if they could provide feedback to Hall Chadwick in the hope no other organisation would be treated the same as Bonza workers in a similar situation.

“I hate the idea, that any another organisation could be subject to this lack of communication and care when they’re going through an administration period,” said the worker.

“Is there a way we can formally provide feedback or complaints about this process so other people don’t have to experience it in the way that we have?”

Bonza’s livery has now been wiped from Australia’s landscape.

Hall Chadwick continued to investigate if Bonza was trading insolvent when it went into voluntary administration with debts in excess of $115m.

She apologised for keeping employees in limbo for so long, but said Hall Chadwick had much to work through following their appointment.

“The first one was trying to deal with the lessor of the aircraft, the second part was in conjunction with that, dealing with the parties and investors and (Bonza owners) 777 Partners,” Ms Vouris said.

“Every decision we’ve made we considered to be the best and most reasonable at the time. It wasn’t ideal to keep extending the stand down.”

The firm sought and won Federal Court approval last month to extend the administration by two months, in the hope of finding the best outcome.

It was suggested 777 Partners was interested in restructuring Bonza, but no formal proposal had been made.

Bonza first took to the skies in late January 2023 with a low cost model based on a regional network largely unserviced by other airlines.

Difficulty expanding the fleet of Boeing 737 Max 8s was considered one of the reasons for the airline’s failure, as well as a disparity in the capacity of the 186-seat aircraft and passenger demand.

Miami-based 777 Partners then withdrew its stake in an aircraft leasing company, which led to the termination of leases on Bonza planes due to unpaid bills.

Qantas, Jetstar and Virgin Australia have encouraged Bonza staff to apply for jobs with them, with dedicated portals set up on their respective websites.

Jetstar and Qantas also renewed their offer on Tuesday to fly Bonza customers with bookings free of charge on the nearest alternative route.

Since late April the airlines have carried 25,000 Bonza customers, and Virgin Australia has assisted 1600 who were mid-journey when the carrier went under.

Originally published as Bonza workers sacked and future flights cancelled after no offers materialise for airline with no planes