A court in Malta has prohibited embattled flag carrier Air Malta (KM, Malta Int'l) from demoting 32 captains to the rank of first officers but has allowed the carrier to go ahead with the laying off of a further 69 pilots, The Times of Malta has reported.

Judge Toni Abela said that the redundancies, as long as the airline followed all relevant labour law provisions, were a measure that Air Malta was free to take to respond to the crisis. However, he argued that the demotions would infringe upon the pilots' rights as they would tarnish their reputation, hinder their career progress, and make it more difficult for them to find employment as captains at another airline without lengthy retraining.

Air Malta tried to defend the demotions by arguing that the pilots would retain their previous pay and employment conditions.

Before the court order, the carrier had also proposed a new deal to the Airline Pilots Association (ALPA), wherein all pilots would retain their jobs through 2023 but at the expense of their salaries being cut roughly in half. The union was due to discuss this proposal with its members on June 29, however, the carrier reportedly withdrew the offer shortly before that, after the court's ruling allowing the redundancies, The Shift reported.

Under the current plan, besides the 69 pilots due to be laid off and 32 whose demotions were blocked, another 30 would retain their current positions and salaries.