Duty free company fires top execs
A company involved in the duty free business and jointly owned by the Barbados Government-run Caribbean International Airways Ltd and Aer Rianta International of Ireland, has fired three of its top executives as controversy swirls around the reasons for the decision.
Information reaching Barbados TODAY raises questions about the reason the company’s Irish general manager, Patrick Molloy, has given for “abolishing” the positions of deputy general manager, retail manager and compliance officer.
An official with intimate knowledge of the situation said the “termination” letters given to deputy general manager David Estwick and retail manager Sharon Hinds conveyed the impression that the company, Caribbean ARI Inc., sent them home in order to save money and put dominance in the hands of expatriates.
However, the official noted that the 2014 financial statements – a copy of which has been obtained by Barbados TODAY – show that the company was not losing money, but making profits. In 2013, gross profits before expenses stood at $6.4 million, while they went up to $7.1 million last year. For the same period, profits from operations moved from $2.3 million to $3.6 million and net income increased from $195,000 to $1.3 million.
A letter to deputy general manager Estwick dated May 5, 2015, bearing the signature and name of Malloy, explained why Estwick was being terminated. It said: “As you are no doubt aware, AerRianta International has been going through an extensive corporate reorganization, both in Barbados and internationally. This reorganization is affecting our operations at all levels.”
The correspondence went on to tell Estwick that “in this context, we regret to inform you that your position as head of finance/deputy general manager is abolished, effective 5 May, 2015, mainly because the finance functions will now be handled by a senior accountant supported from the team in Ireland. Consequently, your employment with us is terminated effective today.”
In a similarly-worded letter to Hinds, Malloy told her that her retail functions would now be handled by a shop floor manager and other duties, including marketing and promotion, would be taken care of within the purchasing function. The compliance officer was dismissed on May 14, but Barbados TODAY was not able to obtain
A senior official of the company, who preferred to remain anonymous for fear of repercussions, was adamant that the company could not be looking to save money by getting rid of three of its key managers when Malloy was receiving a corporate package of about $500,000 per year, which represented roughly 22 per cent of the company’s overall salary bill of $2.2 million.
But Malloy stoutly defended the firm’s decision to part with the three top executives. He said in a prepared statement that after eight years of successful trading, Caribbean ARI Inc. had undertaken an in-depth strategic review to develop a growth strategy which would guarantee that continued success and in turn its contribution to Barbados’ employment and revenue.
“One of the key outputs of the review was the opportunity to reorganize to realize the efficiencies arising from ARI head office support systems, particularly within IT and finance, and to deliver our objectives of positively realigning salary structures and the creation of more full-time versus part-time roles,” the general manager said in response to questions sent to him by Barbados TODAY.
He said while the reorganization would deliver long term benefits in terms of growth and competitiveness, a number of senior roles do not feature in the new structure. “The key responsibilities of these roles have been absorbed into other roles and improved systems where they can be more effectively discharged.” Molloy noted that the key benefits to the existing staff are enhanced roles and responsibilities, more competitive rates of pay, increased opportunities for full time employment and a new commission structure that more effectively recognizes and rewards their efforts.
“The new opportunities offered by the reorganization mean that the total number of Barbadian employees will remain at 56. However, we have lost three key staff members and we would like to thank them for their loyal service and contribution to the company over the past eight years and our HR team will be working closely with them in securing future employment,” he said.
Caribbean ARI Inc is primarily involved in buying and selling and otherwise dealing with retail goods and merchandise of all kinds, inclusive of duty free items in Barbados. It has a board of directors chaired by media relations consultant and well known television personality, Doug Hoyte.