Coronavirus effect: SpiceJet sends most of staff on unpaid leave

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Published: April 1, 2020 1:30 AM

Analysts say that only those airlines in India can survive the cash-burn during a lockdown that have substantial cash on their books.

SpiceJet is yet to take a call on whether its staff will be paid during the rest of the lockdown.SpiceJet is yet to take a call on whether its staff will be paid during the rest of the lockdown.

India’s second-largest carrier SpiceJet said most of its staff will be on unpaid leave during the nationwide lockdown. “SpiceJet has been forced to announce ‘leave without pay’ for employees during March 25-31, 2020 — the period of the lockdown when all passenger flights were suspended. However, employees who have been actively working during this period like our cargo, ground staff, crew who have flown during this time will not be affected,” the company said. Additionally, the company announced a 10-30% pay cut for its top- and mid-rung staff for the month of March. Chairman Ajay Singh’s salary will be cut by 30%. Lowest pay-grade employees will remain unaffected, the company said on Tuesday.

The government suspended domestic passenger flight operations from March 25. The suspension will be in place at least till April 14, as of now. Singh said the pay-cuts were necessary to avoid retrenchments. “The Covid-19 pandemic and the subsequent lockdown have forced us to take some tough measures to ensure that no one at SpiceJet is retrenched. What we are facing is a global phenomenon and no airline in the world is immune to the impact,” Singh said. SpiceJet is yet to take a call on whether its staff will be paid during the rest of the lockdown.

The salaries of employees who have worked during the lockdown in March would be reimbursed, the company said. Analysts say that only those airlines in India can survive the cash-burn during a lockdown that have substantial cash on their books. Airlines have already reached out to the government seeking relief measures for the industry to tide over the impact of the disruptions. Earlier this month, GoAir and IndiGo both cut March salaries for most employees.

The Covid-19 pandemic has also resulted in massive restrictions in international air travel across the world. Many airlines have sent their staff on leave without pay in a bid to reduce expenses. The International Air Transport Association (IATA) expects airlines across the globe to lose revenues of over $250 billion.

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