Turbulent times: Jet Airways to cut salaries, send many staff on leave without pay

Jet Airways which is yet to resume operations under its new owner will reduce salaries for various staff and send many employees on leave without pay amid uncertainty over resumption of its operationsThe measures which will be effective from December 1 were revealed hours after the winning bidder JalanKalrock Consortium JKC said it might take difficult nearterm decisions to manage cashflowsThe oncestoried airline shuttered operations in April 2019 and JKCs resolution plan was approved under the insolvency process by the National Company Law Tribunal NCLT in June last year However due to various issues the airline is yet to restart operationsThe pay cut would be up to 50 per cent and the quantum would be higher for the CEO and CFO The temporary pay cuts and Leave Without Pay LWP for the affected staff would be effective from December 1 a source close to the development saidAlso read Zomato cofounder Mohit Gupta resignsIn a series of tweets Jet Airways CEO Sanjiv Kapoor said less than 10 per cent of the total staff would be on temporary Leave Without Pay and onethird would be on temporary pay reductionAccording to him twothirds of staff are not impacted at all and no staff has been asked to go with the ownership transfer timeline slipping due to factors outside our control some temporary hard decisions had to be taken he said adding that the team working to revive Jet Airways was not responsible for the airline running out of cash and suspending operationsJet Airways has around 250 staffThe latest development also comes against the backdrop of Kalrock Capitals promoter Florian Fritsch coming under the lens of regulatory agencies in Liechtenstein Switzerland and AustriaBesides last month the National Company Law Appellate Tribunal NCLAT directed the consortium to pay the unpaid provident fund and gratuity dues of employees of the carrierEarlier it was planned that the airline would be launched in October 2022 while we await the handover of the company as per the NCLT process the longerthanexpected time being taken for the same may result in some difficult but necessary nearterm decisions to manage our cashflows to secure the future while the airline is still not in our possession the JKC said in a statementWithout elaborating on the decisions that could be taken to manage the cashflows the consortium said it has not breached any term of the resolution plan and remains committed to the airlines revivalIt also said significant progress has been made to relaunch the airlineAfter the NCLTs approval all conditions precedent as outlined in the resolution plan were completed by May 20 2022 and the necessary filings in this regard were made before the NCLT on May 21 2022JKC 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 the statement saidAnkit Jalan Board Member of the JKC said the revived Jet Airways will also provide additional career opportunities including for the airlines former staff who currently make up more than 60 per cent of the current workforce and for many more as the revived airline growsIn the statement Sanjiv Kapoor said the airline has LOIs Letters of Intent in place for aircraft engines IT systems ground handling services catering call centre and all of the other services required to run an airlineLast month the NCLAT directed the consortium to pay the unpaid provident fund and gratuity dues of employees of the carrierThe appellate tribunal had also directed the former resolution professional of the airline to compute the payments to be made to workmen and employees within one month from today and communicate the same to the consortium to take steps for the paymentShares of Jet Airways closed nearly 1 per cent lower at Rs 7685 on the BSE on FridayThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever