The bankruptcy of WOW air has led to layoffs that number in the thousands. Unions and the government are rescuing some of these people.
Iceland’s directorate of labour has been given an emergency additional payment of ISK 80 million (€580,000) by the government to help it respond to mass layoffs resulting from WOW air’s bankruptcy.
The bankruptcy last week has already led to around 1,500 layoffs – the largest mass layoff in Icelandic history, Iceland Review reports.
Most of these, some 1,100 people, were direct employees of WOW air, while another 315 were laid off by Airport Associates, an Icelandic company providing airport services at Keflavík.
The latter newly unemployed are the vast majority of Airport Associates’ employees, as the company had a total staff of 400. The firm provides support services to around 20 airlines at Keflavík, but WOW air accounted for half of its workload.
About 30% of passenger traffic at Keflavík Airport, the country’s main gateway, came from WOW air’s flights, and this is the motivation for the terminal’s duty free stores deciding to sack six employees.
Other job casualties include a construction company in the Keflavík area that dismissed 40 employees and the tour bus company Reykjavík Excursions, which has laid off 59 people.
To the rescue
Coming to the rescue of some of the newly unemployed is the union VR, which says it is working to ensure that its members who are newly jobless – about 250 people – get unemployment benefits immediately, a process that might otherwise take months, Iceland Review writes.
Iceland’s minister of social affairs, Ásmundur Einar Daðason, assures that “we have been working on measures under the auspices of strengthening the Directorate of Labour, and it was agreed […] 80 million would be supplied from the reserve fund”.
On Monday, it was revealed that of the 315 Airport Associates employees who found themselves laid off, 205 will be offered new contracts, according to the Icelandic broadcaster RÚV. The positions alternate between part-time and full-time employment.