Alitalia’s workforce begins voting April 20 on a deal that will decide whether the struggling airline receives a fresh infusion of cash. Personnel have to decide whether they are prepared to accept redundancies and some salary cuts as prerequisites for the new funds.

At stake is a further €2 billion ($2.1 billion) investment from shareholders including Abu Dhabi-based Etihad Airways, which holds a 49% stake in the Italian flag carrier.

Since making its initial investment in 2014, Etihad has been trying to help the perennially loss-making Alitalia turn around its profits. Etihad Group president and CEO James Hogan has said on several occasions that the Alitalia brand carries great potential, but its staff must shed old ideas and methods of working to ensure its future.

A three-year turnaround plan was supposed to see Alitalia turn a profit by the end of this year; that date has now slipped to 2019.

Alitalia is under heavy pressure on its short-haul services, both from low-cost carriers and from the Italian rail network on domestic routes.

Under plans announced in March, some 2,000 jobs would be lost from the 12,500-strong workforce and it was proposed to cut flight crews’ salaries by around 30%.

Following extensive negotiations last week between the airline and its unions, with three senior Italian government ministers acting as mediators, the two sides hammered out a compromise.

The redundancy situation “is really complicated,” an Alitalia source told ATW April 19. “The target figure now [for redundancies] is around 980; that’s probably down from around 1,200 in terms of [staff] redundancies.” The remainder of the initially announced figure of 2,000 was composed of external, contract staff, he explained.

Additionally, the proposed 30% salary cut has now been slimmed down considerably, to just 8%.

Alitalia staff will be able to cast votes in Rome and Milan until midnight April 23.

“What the board and shareholders said was: ‘We’re prepared to invest a further €2 billion’—which is being called a re-launch plan in Italy—‘but that has to be subject to union agreement,” the source said.

Asked what would happen if the unions rejected the preliminary agreement, he said: “Let’s not go down that road.”

Alitalia is believed to be rapidly burning through its cash reserves and could face administration if no agreement is reached.

Alan Dron alandron@adepteditorial.com