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1 Found helpful • 7 Pages • Essays / Projects • Year: Pre-2021
In this case, there are several key facts that deeply affect the question solving process. As this article is written to APA for advice for the purpose to find out the chances of success, the main issue is to determine Xpress Air Ltd(XAL) has separate legal entities from Kwir Air Ltd(KAL) or not. If they have a single legal entity, it seemed that the chances of success will become very high and the reasons will explain later on. Therefore, the key facts will relate to this question. KAL want to evade the falling profit, it wanted the pilots volunteered take a reduction on their salaries. Pilots refused, hence the KAL formed up XAL to be a subsidiary company of KAL and all the pilots being made redundant. Later on XAL employed the same group of pilots with doing the same works and working hours, but with lower wages and superannuation in Australia. KAL received all the profit made by XAL as dividend and all the directors in XAL was appointed by KAL. Consequently, the overlap management of two companies is obvious and KAL had a very large degree of control as parent company is suspicious. And it is very strange that an airline company did not have its own airplanes, KAL leased the planes to XAL for making profit.
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