Thank you to all Members who were able to attend our two meetings on Thursday 1st August. Despite being held under difficult circumstances, we believe these meetings were very worthwhile.
Whilst many of you were unable to attend and we cannot cover every question asked, below are some of the more frequently asked questions from both sessions:
General – All Pilots
1. Who can I reach out to if I or my immediate family are struggling with the current situation?
If you need urgent attention you should call 000.
In the alternative, crisis counsellors can be reached 24/7 at Lifeline (13 11 14) and Beyond Blue 1300 22 4636.
Help is also available through the AFAP’s Member Assistance Program (MAP). The MAP is an independent, short-term counselling and advisory service which is available free for members and their immediate families. Even if you feel you are coping but may need help if additional stressors are introduced, you should reach out. Taking a proactive approach to coping mechanisms is the best way to combat against unforeseen mental health issues.
Call 1300 307 912 to speak to a qualified psychologist, for any personal or work-related problems. Depending on your location, these confidential sessions can be conducted in person, by phone or via Skype
2. What happens next?
The Australian Securities and Investments Commission (ASIC) has a helpful guide and fact sheet on their website https://asic.gov.au/regulatory-resources/insolvency/insolvency-for-employees/voluntary-administration-a-guide-for-employees/
In short, when a company is placed into voluntary administration, an Administrator is appointed and they take full control of the affairs, business and financial circumstances of the company. During this period, the existing board of the company are not able to exercise their normal powers.
The Administrator will investigate the finances of the company and report to all creditors (including employees), the three options available and their opinions of each based on the assessments made:
- Return the company to the Directors’ control, ending the voluntary administration; or
- Approve a deed of company arrangement (DOCA), which is a process where the company will pay part or all of its outstanding debts and be free of those debts; or,
- Wind up the company and appoint a liquidator.
The creditors meeting is normally held approximately 5 weeks after the company is placed in voluntary administration, however a court may extend this period at the request of the Administrators. Creditors (including employees) will be presented the three options, with EY providing their opinions on the best path forward, and then creditors will be requested to vote on their preferred outcome, with the highest vote being the path adopted.
3. Can we trust what the Administrators are saying?
The AFAP have no reason to doubt statements of EY (Ernst & Young) Australia and the Administrators. EY are a large and reputable top tier firm that has been around for considerable time.
Voluntary administrators must also be registered liquidators with the Australian Securities and Investments Commission (ASIC) and must not be disqualified from accepting appointment under the Corporations Act. Administrator registration is also subject to an independent committee review process, through ASIC.
4. Why aren’t 737 Pilots with Saab qualifications being redeployed to Rex?
We understand that Flight Operations Management are very keen to take Pilots with appropriate qualifications back to the Saab, acknowledging the current considerable shortfall of pilots.
It is important, however, to note that whilst the company is under administration, all business decisions fall under the complete control of the Administrators (EY). This includes any hiring decisions. The Administrators advised they would look into options available, however acknowledged they only have limited funds, and their first priority is to keep the regional operation running, in preparation for either refinancing or sale of the business.
The AFAP acknowledge the current situation, and the likelihood of some Saab Pilots seeking alternative employment during this period of uncertainty, and intend to make representations to the Administrators.
If you are a RAL Pilot who has sought redeployment and been denied, please contact your AFAP representatives James Mattner (james@afap.org.au) or Jared Marks (jared@afap.org.au).
5. Do I need to submit a Proof of Debt form?
If you are a Regional Express Holdings (Saab) Employee, you DO need to submit a Proof of Debt form. Submitting a proof of debt form gives you access to Creditor meetings and voting rights. You are currently still employed, and the Administrator is continuing to pay your wages as normal, but you technically have a debt owed by Regional Express Holdings in the form of annual and long service leave balances, as well as an entitlement to redundancy payment if you are subsequently made redundant.
Note that all of these “debts” remain in place if the company is sold, so you don’t need to worry about possibly losing those entitlements.
The process of meetings and voting regarding the future of Regional Express Holdings will be restricted to Creditors of the company who submit a Proof of Debt form. In due course, these meetings and votes will determine what happens to Rex beyond the period of Voluntary Administration (as set out in the answer to question 2, above).
If you are a former RAL (737) employee, you DO need to submit a proof of debt form. You should be as honest as possible in assessing your debt owed, however there is an ability to make amendments to what you submit so it does not need to be perfect the first time around. You may need to substantiate the quantum of your debts at some point, but that is not required for your first submission. Payslips and rosters may assist with this, and you should include all outstanding claims including, but not limited to:
- Extensions
- Casual days
- Meal claims
- Notice period payments
- Accrued, but not taken:
- Annual leave (with reference to payslip, not annual leave roster)
- Days in lieu
- Long service leave
We understand RAL employees have had their access to payslips (via RexLink) and email revoked. EY should provide all applicable documentation to submit a Proof of Debt form. Questions specifically related to that process (including lack of access) should be addressed to EY via email rex.employees@au.ey.com or calling 1 800 709 077.
6. What will happen to the Board in the case of a sale of the business?
At present this is unclear and any changes to the Board would be at the discretion of the new owner.
7. Are AFAP membership payments on hold?
For RAL (737) pilots, all AFAP membership fees are currently on hold and not required to be paid.
For Rex (SAAB) pilots, membership payments continue unchanged.
8. Is my AAPMBF coverage affected?
MBF payments are usually processed around May, and we do not have any information to suggest that didn’t occur. AAPMBF coverage will continue as normal and your eligibility should not change. If there is any issue regarding your membership, you should be contacted directly by the MBF.
Rex Airlines (RAL/737)
What happens to my Training/Endorsement Bonds?
According to clause 17.1(h) of the Rex Airlines Domestic Pilots Enterprise Agreement 2022:
“No amount can be recovered in the case of redundancy, loss of medical licence by the Pilot, termination of employment by the Company …”.
Therefore, if a bond was outstanding upon being made redundant, the company has no right to recover any amount from you under the terms of that bond.
Regional Express Holdings (REX/SAAB)
1. What happens to my cadet repayments currently, or in the event I am made redundant? Can the Administrator pursue my Cadet Loan as an outstanding debt?
Currently, as you are still an employee of the Company and being paid as such, we expect Cadet repayments to continue as per your contract.
In the event your employment is terminated, the Cadet contracts operate outside the scope of your employment contract, and we understand that could mean that repayments might be pursued under the terms of your specific cadetship contract, as a debtor of the company.
2. What should I do if refuellers won’t refuel the plane, hotel accommodation won’t check me in, transport provider won’t pick me up, etc…?
Pilots should contact the Network Operations Centre (NOC) for assistance with these types of issues. The Administrator and Flight Operations Management have advised they expect the regional operation to continue without change or interruption.
As current employees, all clauses and sections of the Enterprise Agreement (EA) remain unaffected and the Employer/Administrator’s obligations to provide transport and accommodation when on company business (scheduled, unscheduled and simulator/training duties) remains.
Any instances of the NOC refusing to provide assistance, should be reported to the AFAP or Rex Council Members for follow up with the Administrator.
3. Do any parts of the Regional Express Pilots’ Agreement 2022 (EA) change whilst we are under administration?
No, the EA remains unchanged whilst the company is under administration. There is always a possibility that a variation to the existing enterprise agreement could be sought through the Fair Work Commission, but there has been no suggestion at this stage that the Administrators are considering any such process. Ultimately, all pilots would get to vote on any proposed variation, regardless.
Should you or any of your colleagues identify areas of the EA that you believe are not being followed, or if company obligations are not being met, please let us know so that we can urgently follow up with the Administrators.
The recent emails from the Administrators advised that they “do not personally adopt any pre-existing employment contracts that you may have held with a Company.” Because Regional Express is still trading, the Company is still responsible for meeting all entitlements under the EA. This sentence suggests that EY has not taken over the responsibility to pay Rex Pilots.
4. What happens with casual days, extensions, meal claims, etc?
As the provisions of the EA still apply to all Rex Pilots, there should be no changes to the assignment or payment of these types of additions.
Any Pilot who accumulates an applicable claim, should submit it through the e-claims portal as normal.
5. What happens to my staff car park access?
For Sydney specific information, see question 6.
We have not been notified that existing arrangements have or will be discontinued. Unless this changes, issues accessing the car park should be handled in the same way as it was prior to Voluntary Administration – contact the NOC for guidance.
It is worth noting that whilst these existing arrangements have been preserved, parking is not an entitlement under the EA.
6. What happens with the Sydney car parking arrangement at the Branksome?
On 2nd August, it was advised by the GMFO, that the free of charge Sydney Super Shuttle will cease during the administration period, however staff may continue to utilise the shuttle at their own expense ($10 one way). Tickets may be purchased from the Branksome reception. It is worth noting that the “season pass” payment is explicitly for the purposes of parking, with the shuttle bus being an entirely separate arrangement.
To date, we have not been notified of any changes to parking at the Branksome. Until any formal notification is received, any lack of access to the car park should be treated in the same way as it would prior to Voluntary Administration – contact the NOC for guidance.
If formal notification is received that the arrangement is ceasing, we would recommend Pilots immediately contact Human Resources and request the payment be stopped.
7. I am currently on a 28-day forced temporary base transfer, away from my home base. What happens to me?
As you are currently still employed, all provisions of the EA remain unchanged. This includes the Temporary Base Transfer clause (56 – Transfers – Temporary). The only change would be clause 56.9 where a Pilot needed to raise attention to an inadequacy in terms of the transfer. This would need to be addressed to the Administrator during the Voluntary Administration period.
For Sydney based Pilots, in the event the Branksome parking arrangement is terminated whilst you are away, we would suggest you contact the author of the notification immediately upon receipt. As you are operating entirely in accordance with an employer direction, we believe it is the company’s responsibility to release your vehicle and pay any associated fees upon your return.
8. What is a “preliminary pre-appointment entitlement calculation” and why does it say “this calculation does not encompass entitlements under your employment contract”?
At this point, we understand a preliminary pre-appointment entitlement calculation to be a statement by the administrator of what they believe Rex owes you at the time of their appointment. However, this is not a defined phrase and likely an internal EY term. We have reached out to the Administration team for clarification and will provide an update once received.
It seems the initial calculation may be undertaken purely with reference to the National Employment Standards (NES). This can be undertaken quickly (days rather than weeks) via a known standard. The Administrator has undertaken to provide a more accurate assessment within two to three weeks with reference to the applicable EA. The preliminary calculation provided to you will potentially assist you to complete a Proof of Debt form to access creditor meeting attendance and voting rights.
In the meantime, please don’t hesitate to reach out to any of your Council representatives.
Your AFAP Rex Council