Investors in liquidated airline Bahrain Air are being threatened with legal action unless they hand over outstanding severance package payments, a report said.

Hundreds of former employees are still waiting for the second half of their settlements, four months after the owners announced it was going into voluntary liquidation, reported the Gulf Daily News (GDN), our sister publication.

Union leaders agreed to a deal that would see former staff get 24 days' pay for every year they worked for the carrier, plus leave and indemnity for foreign employees.

The airline paid staff 40 per cent of their entitlement in March and another 10 per cent in April, but the Bahrain Air Trade Union (BATU) is now vowing to go to court if the remaining 50 per cent is not handed over.

"At the moment the (airline) shareholders are not willing to pay," Bahrain Air Trade Union (BATU) chairman Abdull Raoof told the GDN.

"The company has still not sold off its assets and the last payment we got was 10 per cent in April. But many staff are still without work and those who are working need the extra money to settle the debts they built up while unemployed."

The union says more than 100 of the 345 former Bahrain Air staff are still looking for work.

Raoof added that he had been inundated with calls from former staff to commence legal proceedings over delayed severance payments, which he valued at more than BD1.1 million ($2.9 million).

"I have been getting a lot of calls from the staff," he said.

"They don't think the company will pay the remaining 50 per cent and feel that they have nothing to lose by going to court, so that is what we will be doing.

"We will adopt a much more aggressive plan of action and are giving shareholders until the end of this month to pay in full, Even if we get another partial payment, we are going to continue with legal action and won't accept anything less than full payment."

Court action has already been launched by 34 former employees, who are demanding compensation for losing their jobs.

Former staff involved in that case have not received any settlement because they are demanding a one-off payment from the airline.

Raoof said any new action would be brought on behalf of all 345 ex-employees if severance packages were not paid in full by June 30. "I already have the case file ready with all 345 Bahrain Air staff names attached to it, but it will be filed on July 1 if we are not paid," he added. – TradeArabia News Service