A voluntary redundancy scheme for Air Malta employees was announced this evening by the airline's CEO Peter Davies.
In a meeting for the airline's employees at the Dolmen Hotel in Qawra, Mr Davies said formal talks with unions about the scheme will start next week.
The turnaround, he said, was essential and time critical and the end of summer had been set as the target by which time the key changes to the airline would have been implemented.
Workers who were at the meeting and spoke to timesofmalta.com on condition of anonymity said that 511 jobs will be lost and the scheme would be issued in August.
The workers, who said the atmosphere at the meeting was subdued with a few angry outbursts, were not told how many workers the airline was aiming would leave after taking up the scheme.
However, they were told that if the target was not met, the airline would then follow a last in first out policy.
They were told that the government was not guaranteeing alternative employment.
Chairman Louis Farrugia told the hundreds of employees at the meeting that Air Malta had no option but to carry out a significant restructuring to save the airline and hundreds of jobs:
"We're doing all that is possible to carry out this very difficult but mission critical task. Every stakeholder needs to embrace change in order to survive and rebuild the future... By working together we will make it."
He announced that the airline had already started implementing the restructuring plan that had been presented to the European Commission. A key milestone of this plan was to reduce costs by €30 million per annum and increase revenue by the same amount.
Mr Davies gave a detailed presentation of where the airline is today and highlighted the salient critical areas that needed significant change. He presented the roadmap with milestones to be achieved that would secure the successful turnaround of the airline.
Mr Davies revealed that in the last financial year ending March unaudited accounts indicated that Air Malta made a loss of €36 million.
He announced the appointment of Philip Saunders, as chief commercial officer. Mr Saunders, who has worked for Mr Davies before on other restructuring projects, is joining Air Malta to lead the commercial division.
Mr Davies also announced that a Maltese chief financial officer would be appointed to the airline on September 1. The airline, he said, needed senior experienced personnel - locals as well as foreigners - to spearhead the restructuring process.
He said that another five professionals specialised in project management and airline restructuring would be joining Air Malta and taking on the responsibility for information technology, revenue management, finance, engineering and cargo sections.
This team is appointed on a temporary basis, specifically focused on accelerating the pace of change during these six months.
He appealed to all stakeholders to understand that unnecessary speculation would harm the change processes.
Meetings such as today's, he added, were intended to communicate directly with employees to rebuild trust amongst the key stakeholders.
The meeting was chaired by Industrial Law specialist Andrew Borg Cardona.
On Wednesday, the General Workers' Union warned that unless the government declared that it will offer alternative employment as an option to redundant workers who still wanted to work, it would declare an industrial dispute at Air Malta.
It gave the government until June 30 to make a formal announcement. In a brief statement shortly after, the Finance Ministry said that workers will be offered different options so that any decision taken will "have the least social impact".
The Union Ħaddiema Magħqudin yesterday also insisted the government offer alternative employment to Air Malta employees as it did in the past when restructuring state-owned companies.