Ansett workers payout rises to $217m
November 25, 2003 - 11:58AM
From
www.smh.com.au
Former Ansett employees are set to get an extra 42 cents in the dollar on their outstanding entitlements under a deal to settle long-running litigation over the airline's assets.
The agreement, announced in the Federal Court in Melbourne today, involves the Commonwealth agreeing to defer its claim on $67 million owed to it by the airline's administrators.
Under the settlement which is being presented to the court for approval, $150 million will be available for employees' entitlements almost immediately, with the $67 million contributed by the government to be distributed to staff according to an agreed formula.
The complicated deal will end nearly two years of legal action between the airline's administrators and the trustees of an employees' superannuation fund which was pressing a claim of $180 million on the airline's assets.
Of the $67 million, $39 million will go to members of the Ansett Ground Staff Superannuation Plan, while $28 million will go to the airline's remaining workforce.
Simon Whelan, QC, for the administrators, said the deal would make an extra 42 cents in the dollar available for payment to employees.
"It will take them to 71 cents in the dollar," he told the court.
Mr Whelan said the agreement involved a re-ordering of payment priorities.
"The proposal works because the Commonwealth are stepping back for a sum of money and the sum ...is $67 million," he said.
Mr Whelan said no creditors would be disadvantaged by the deal except the Commonwealth and possible members of the superannuation trust who were close to retirement.
Justice Alan Goldberg, who will have to approve the settlement, expressed satisfaction that a compromise had been reached.
"The over-riding issue is that two years of litigation, millions of dollars in cost and further litigation is bought to an end," he said.
Ansett workers to get better deal
November 25, 2003
FORMER Ansett employees are set to get an extra 42c in the dollar on their outstanding entitlements under a deal to settle long-running litigation over the airline's assets.
This gives them a total of 71c in the dollar.
The agreement, announced in the Federal Court in Melbourne today, involves the commonwealth agreeing to defer its claim on $67 million owed to it by the airline's administrators.
The Australian Services Union (ASU), the largest of the unions representing former Ansett workers, welcomed the proposed settlement.
"Nobody wanted to see the lawyers grow rich and fat over this," ASU assistant national secretary Linda White said.
"A whole lot of Ansett employees are doing it tough and they wanted the money.
"It was their company and they just didn't want to see this be bogged down in the courts for years to come.
"It's all about giving to people who put their heart and soul and life into Ansett what they really deserved, and it's good that it can be resolved in a way that is going to close this chapter for them."
Ansett administrators have $415 million in the bank and will be able to pay out $300 million under the settlement, while keeping $115 million for other contingencies.
The commonwealth, which is owed $217 million for money lent to pay workers leave entitlements and eight weeks' redundancy payments, will receive $150 million up-front under the settlement.
Employees will receive $150 million in entitlements, taking their total payout so far to $540 million.
Ansett still has about $200 million in assets to be sold, including 29 aircraft and millions of spare parts.
Administrators Korda Mentha say if the remaining assets are sold, employees should eventually receive 85c in the dollar.