The Greater Toronto Airports Authority (GTAA) is reducing its workforce by 27% and putting a new structure to align with its business transformation and enable more nimble, innovative, and recovery-focused operations in place.
The GTAA said that the changes “reflect a significant decrease in global air traffic,” with passenger numbers at Toronto Pearson currently at approximately 1996 operating levels.
In April 2020, the GTAA reported its passenger numbers were reduced by 97% compared to the same period of 2019.
In making the announcement the airport authority said that the reduction of approximately 500 positions will be achieved through the elimination of approximately 200 unfilled positions, together with voluntary departures and layoffs totaling approximately 300 employees.
The workforce reductions follow numerous cost reduction measures the GTAA has implemented since the pandemic began, including a hiring freeze, reducing planned capital spending by $265M for 2020, and temporarily reducing executive and Board of Director salaries. GTAA has also leveraged the Canada Emergency Wage Subsidy and the Canada Emergency Commercial Rent Assistance programs, and provided deferrals for eligible corporate partners.
Deborah Flint, president and CEO of the GTAA, said: “Our leadership team and Board of Directors have worked concertedly each month to navigate these turbulent times and have put our people first. This reduction in force is a difficult but necessary step, and one that we take with great sadness.”
Flint continued: “The leadership team and I are deeply grateful for the contributions of our employees, each of whom has been part of the success and legacy of the GTAA. We are dedicated to treating everyone with the greatest respect and consideration throughout this process. We are committed to maintaining our operations and the health and safety of the airport as we evolve our organization to drive our recovery. I am confident that we have a capable and resilient team and the right approach to come through these challenging times with strength.”
The reductions are now in effect beginning today, with departures extending through fall 2020. The GTAA is working closely with Unifor and the Pearson Airport Professional Fire Fighters Association to implement these changes for their members, respecting the terms and philosophy of the collective bargaining agreements. In addition to notice and severance packages, all employees will be offered career transition and employee assistance program support.
As previously reported on May 12, 2020, the COVID-19 pandemic and resulting economic contraction has had, and is expected to continue to have, a negative impact on demand for air travel globally.
Toronto Pearson has experienced significant declines in passengers and flight activity, as a result of travel advisories and restrictions by governments, flight and route cancellations and fleet groundings by air carriers, and passenger and flight activities may not return to pre COVID-19 levels for at least three to five years according to certain industry participants.
The reduced activity is having a significant negative impact on the GTAA’s business and results of operations, including aeronautical and commercial revenues and airport improvement fees.
The restructuring includes the departure of two members of the GTAA executive team: Kim Stangeby, Vice-President and Chief Strategy Officer and Interim Vice-President, Human Resources, and Scott Collier, Vice-President, Customer and Terminal Services. Their portfolios will be redistributed across the organization, including under the newly established Chief Operating Officer, Craig Bradbrook (formerly Vice-President, Aviation Services), and in a new centre of commercial excellence led by Chief Financial Officer, Ian Clarke. The GTAA will also complete a search for a new Chief Human Resources Officer.
The GTAA’s announcement came as various media outlets were reporting that the Canada-US border would remain closed for at least another 30 days.