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Cyprus

Akel MEP seeks EU compensation for Cobalt employees

MEP Neoklis Sylikiotis

Akel MEP Neoklis Sylikiotis said on Monday he has requested EU compensation for the around 280 former employees of the now defunct Cobalt Air as the small job market of Cyprus will not be able to absorb them all.

Sylikiotis announced that he has already brought to the attention of the European Commission the “immediate need to compensate Cobalt’s employees who, due to the bankruptcy of the company, have been laid off”.

In an emergency note to the European Commission (EC), Sylikiotis said that laying off 280 people would lead to chain reactions in the economy and because of Cyprus’ small size and job market.

The MEP has asked for compensation from the European Globalisation Adjustment Fund (EGF). The EGF was set up by the European Union in late 2006 to provide support to people losing their jobs as a result of major structural changes in world trade patterns due to globalisation. This includes the closing down of large companies or when production is moved outside the EU.

Sylikiotis called on the EC to look into whether Cobalt’s former employees could benefit from the EGF.

As a general rule, however, the EGF can be used only where over 500 workers are made redundant by a single company, or if a large number of workers are laid off in a particular sector in one or more neighbouring regions.

It can fund up to 60 per cent of the cost of projects designed to help workers made redundant find another job or set up their own business, but it does not co-finance social protection measures such as pensions or unemployment benefit.

Cobalt, which closed down nearly two weeks ago, hired a large number of former staff from Cyprus Airways, which was grounded in 2015 after the European Commission ruled that a state aid package was in violation of competition regulations.

The former employees, as all private sector workers, have the right to sign for unemployment benefits and receive help by the state job centres in finding employment elsewhere.

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