The global financial crisis that developed in 2008 had significant repercussions on the world’s most developed economies and the most significant aspect was the amount of redundancies that ensued as businesses closed down.

Fortunately, Malta was spared the savage onslaught experienced by international economies and somehow survived through a relatively mild recession, even though certain sectors were directly affected by the international situation and a handful of companies were on the verge of reducing the number of employees. The government had intervened in time and these companies were able to continue operating through the challenging period. In terms of redundancies, a small number of companies had closed their doors a few years ago and the country was shocked as hundreds of employees lost their job overnight.

More redundancies are regrettably on the cards, with Air Malta employees currently waiting to know their fate as the restructuring plan is being finalised. On a similar note, the country was stunned last week by the news that GO plc will be reducing the number of employees through redundancies. It is a most unfortunate situation and sensitivity is required in handling this case, in particular due to the number of families dependent on the employees who are bound to lose their job any time soon.

The fact that both Air Malta and GO plc are overstaffed has been known for many years, and a reduction in the employee complement has been feared by GO employees ever since foreign investors acquired the telecommunications company through the acquisition of the majority shareholding held by government.

A series of early retirement schemes were made available, but quite clearly these have not been sufficient to reduce the number of staff to the required levels. The General Workers Union, which represents the majority of employees, immediately registered an industrial dispute over the proposed redundancies.

Understandably, the union will not accept that employees are made redundant and if downsizing is absolutely necessary adequate compensation will be demanded for every employee who loses his or her job.

According to the statement issued by GO, the company has to reduce its labour cost “to remain competitive in the long term as regulatory pressures across the EU to reduce tariffs and with technology changing the way in which people use telephones, mobiles, television and broadband, the company anticipates considerable pressure to cut costs even further to remain competitive”.

In its bid to remain competitive, and perhaps ironically in the circumstances, the company is investing €100 million over the next few years to upgrade its infrastructure and services. For the employees, this will be a very difficult concept to accept, as they are being made redundant while the company is at the same time investing the significant amount of €100m to remain competitive.

On the basis that the GWU has decided to oppose the planned redundancies, this case is bound to be unnecessarily battled publicly and perhaps even politicised. Irrespective of the disputes that may ensue, the future of the employees being made redundant is the most important consideration that has to be kept in mind.