Newcastle Airport will stand down about a quarter of its workforce from Friday.
The airport, which is owned jointly by Newcastle and Port Stephens councils, applied successfully to the Industrial Relations Commission for orders allowing it to stand down staff temporarily due to COVID-19.
It is understood the orders will affect about a quarter of the airport's 59 staff and other employees will take a cut to their hours.
"These orders and the decision making behind them were not made lightly," airport chief executive officer Peter Cock said in a media statement.
"It is something the airport hoped it would never need to consider, however, we find ourselves in extraordinary times."
The airport said this month that its board members, who each receive $45,000 a year in fees, would be paid "significantly reduced" remuneration "for the foreseeable future".
The airport has been largely idle since the pandemic started affecting domestic travel in March.
"As a business, we know that applying to the commission has been difficult for employees," Dr Cock said.
"I would like to thank them for the way they have dealt with this process."
He hoped the IRC orders would "provide a sound framework for us to work with employees to effectively manage the business ... and come out the other side".
"For the sake of our employees and the region we need to be able to ramp up quickly to take advantage of the recovery when it inevitably occurs.
"We remain confident about tourism in our region and the ambitious plans we have for the airport.
"This news is also a timely reminder of the need for the government to invest in the aviation industry."
The stand-downs continue an unhappy year for the airport, which continues to call in vain for government funding to expand its runway to cater for larger aircraft.
The Williamtown airport argued unsuccessfully to be included in the federal government's JobKeeper program.
Its revenue has plummeted by 90 per cent in the past five months and its passenger traffic by 99 per cent.
Jetstar announced in June that it would close its Newcastle maintenance, pilot and cabin crew bases by the end of the year as part of massive job cuts announced by parent company Qantas.
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