Japan Airlines Co. plans to halve bonuses for its employees this summer due to sharp deterioration in business over the spread of the new coronavirus, according to sources familiar with the issue.
The airline operator has informed employees about the plan and intends to secure a labor union agreement this month, the sources said.
JAL has paid two months' worth of wages as a bonus in recent years. But the amount is expected to be cut to one month's worth, matching the level paid in 2011 after the company went bankrupt the previous year.
Management has determined that demand for flights will take time to recover and that the company's difficult financial situation is likely to continue, they said.
Japan Airlines saw a 98 percent plunge in the number of international passengers in April from a year earlier to 16,039 due to the pneumonia-causing virus.
During the Golden Week holidays around the first week of May, the number of the airline's domestic flight passengers tumbled 95 percent from the same period last year to 47,646.
The number of international flight passengers totaled 2,030, down 99 percent.
All Nippon Airways Co. has also presented its labor union with a proposal to halve summer bonuses, company sources have said.
The subsidiary of ANA Holdings Inc. usually sets its bonus at two months' worth of salary but plans to decrease it to one month.