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Bonza’s administrator told a confidential meeting of creditors last week that a sale is now unlikely, according to multiple reports.
The Australian Financial Review claimed attendees were informed the jobs of staff are set to be terminated this week, while The Australian added the tone was “not positive”.
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It had previously been reported that administrator Hall Chadwick had set last Friday as the deadline to sell the business.
Bonza entered voluntary administration in April after its lessors seized its fleet of four Boeing 737 MAX 8s, forcing it to cancel all flights.
In total, the airline owes money to around 60,000 people and companies. The debts include $5 million owed to 323 staff and close to $16 million owed to trade creditors.
However, any attempt to wind up the company would at least allow staff to claim unpaid salary through the government’s ‘Fair Entitlement Guarantee’.
Many effectively remain in limbo and are unable to claim their salary from the government immediately because the company is continuing to search for new investment in a bid to stay alive.
The core requirement of the ‘Fair Entitlement Guarantee’ is that an employee can only claim if they have lost their job “due to the insolvency of your employer”.
News.com.au later reported that the administrator told staff that if they were to resign and take up employment elsewhere, this would not be deemed ‘casual work’, and their chances of receiving payment would be further reduced.
The Fair Work Ombudsman advises on its website: “If an employee resigns during the administration period, they may not get their accumulated leave entitlements.
“They become a creditor if the company owes them money, they need to speak to the administrator about outstanding entitlements.”
The news Bonza is struggling to find a buyer comes after Australian Aviation reported that the airline’s last leased aircraft left the country last week.
The 737 MAX, VH-UJK, known as ‘Sheila’, departed from the Gold Coast at 9:20am on Wednesday.
The development was significant because, if the company were to find a purchaser, it would likely need to acquire an aircraft of a similar size to fulfil previously purchased tickets.
However, a global lack of aircraft post-COVID-19 means either purchasing or leasing larger planes could prove difficult, with Virgin Australia separately facing severe delays in its purchase of new MAXs.
The situation is complicated by the FAA’s recent announcement that it would continue to limit the number of aircraft Boeing can manufacture following the Alaska Airlines door plug incident.
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says:In the early stages of this administration, we were led to believe that there were/was an almost imminent buyer/s. I believe that the administrators are duty bound, in the public interest to identify to us those “interested parties”