NEW DELHI: Grounded carrier Jet Airways has implemented a steep salary cut of up to 50% for a section of its employees and sent nearly 10% of its workforce on leave without pay. This comes as the airline, under the new management of Jalan Kalrock Consortium (JKC), is struggling to take-off amid an ongoing tussle with its lenders, among other hurdles.
Confirming this development, Jet Airways’ CEO Sanjiv Kapoor took on Twitter and said two-thirds of total staff won’t be impacted at all, while the remaining one-third; most will be on temporary pay reduction. He added that 10% of the total workforce will be on temporary leave without pay and that none of them has been let go.
“These are all good people who have been working hard to try to do what has never been done before: revive an airline that has gone bankrupt. However with the ownership transfer timeline slipping due to factors outside our control, some temporary hard decisions had to be taken,”said Kapoor.
JKC in a statement on Friday noted it might take ‘difficult’ near-term decisions to manage cashflows. It also said they have not breached any terms of the insolvency resolution plan. This statement comes amid rumours that lenders of the airline may approach the court to oppose JKC’s proposed and passed resolution plan.
The fresh tension between the two parties brewed after the National Company Law Appellate Tribunal (NCLAT), last month, directed the consortium to pay the unpaid provident fund and gratuity dues, amounting to over Rs 250 crore, of employees of the carrier. JKC reportedly informed lenders that it would not be making this additional payment.
There are also differences between the two parties over the minutes of the asset monetization plan of the airline and the final handover of the company. “JKC has deposited Rs 150 crore as required under the court-approved resolution plan with the lenders, with the remaining amounts to be invested only after next
steps of NCLT are fulfilled in terms of handover of the company to us,” JKC said in a statement.