Ironic, Offers Employees For Early Retirement But Garuda Indonesia Doesn't Have Funds For Severance Payment

Garuda Indonesia aircraft. (Photo: Doc. Garuda Indonesia)

JAKARTA - PT Garuda Indonesia (Persero) Tbk (GIAA) offers an early retirement program for employees who have worked for more than 30 years. This program aims to save this state-owned airline amidst the lack of occupancy due to the COVID-19 pandemic.

President Director of Garuda Indonesia, Irfan Setiaputra, said that the early retirement program is planned for as many as 1,099 employees. Nevertheless, Irfan admitted that the company still has not pocketed the funds to pay severance pay and all company obligations.

"We didn't (have the money) agreed when we announced that the execution of early retirement was adjusted to the availability of funds," said Irfan in a Hearing Meeting (RDP) with Commission VI of the Indonesian House of Representatives (DPR) at the Parliament Building, Jakarta, Monday, 21 June.

Furthermore, Irfan said that from the quota opened for employees who want to apply for early retirement, there are still few who register. Therefore, the company will continue to disseminate information to all employees so that more people will participate.

Irfan said that if the quota has been met, then the company will gradually retire early. Irfan said, this scheme is the same as last year, where Garuda Indonesia provides an early retirement program to its 700 employees in stages over six months.

"Until the time the decision letter (SK) has not been issued, the status of the employee remains in accordance with the rights and obligations. God willing, starting at the end of this month early retirement will be carried out," he explained.

Furthermore, Irfan hopes that by the end of the year the early retirement program can be completed exactly like last year's program which took five to six months to execute.

Irfan added, in addition to providing early retirement, his party will also offer other programs to reduce operational costs. The choice is an offer of leave outside the company's responsibility (unpaid leave) for employees who will or after giving birth.

Not only that, employees who will continue their education for a long time are also entitled to apply for this program. When the aviation industry begins to recover, employees who apply for unpaid leave can later rejoin the company when they are needed.

"There are other offers that will be discussed again with other friends. What is clear is that we have no desire at all to oppress employees and secondly, we know that today is not the right time to ask people to leave," he said.

As is known, the national airline PT Garuda Indonesia (Persero) Tbk is being hit by a huge debt problem. Various efforts were made to save the state-owned airline, starting from issuing an early retirement program to cutting the number of commissioners.

Garuda Indonesia (GIAA) does have a red report card in financial aspects, including the value of debt in 2021 which will reach Rp70 trillion and can continue to grow along with the sluggish aviation business due to the COVID-19 pandemic.

The state-owned airline is reportedly offering an early retirement program which is effective from July 1st. This offer is payable in the e-mail received by the employees. This program is carried out as one of the efforts to restore business performance in the new normal era.