Nearly 60% employees of GoAir’s will be put on “temporary leave without pay”, the airline’s promoters Nusli and Jeh Wadia in a joint letter informed employees.
Nearly 60% employees of GoAir’s will be put on “temporary leave without pay”, the airline’s promoters Nusli and Jeh Wadia in a joint letter informed employees. April salaries of close to 2,500 lower-grade employees were paid. “GoAir released full salaries to about 2,500 less fortunate employees, equivalent to 40% of our workforce, with the remaining employees getting paid on a graded and deferred basis,” the Wadias said in a letter to employees.
Airlines have been forced to suspend passenger operations since March 25 during the nationwide lockdown to slow down the spread of Covid-19. GoAir had “very little revenue” between March 17 and 24, “with nil revenue thereafter”, the mail said. “With no inflow of cash, which we now anticipate will continue through the end of May, a period of over 10 weeks, and with no support forthcoming yet from either the government or the banking system, we were left with no alternative but to make the unfortunate and sad decision to pay the March-earned salaries over March and April,” the letter read
GoAir’s board members, chairman Nusli Wadia and managing director Jeh Wadia, will draw no remuneration. CEO Vinay Dube has also taken a 50% pay cut and voluntarily deferred most of his balance compensation. The senior management has taken “substantial pay cuts and have also deferred a portion of their compensation”.
The lockdown will be in place at least till May 17. The Directorate General of Civil Aviation (DGCA) last month directed airlines to stop taking forward bookings until notified by the regulator.
The Wadias said they do not expect commercial passenger flights to resume before June 1, and have sought government assistance to tide the airline over. “We have also been in continuous touch over the past several weeks with the Ministry of Civil Aviation and the government for financial assistance and structural changes, both fiscal and non-fiscal, both individually and together with the other Indian airlines, but so far no concrete measures have been forthcoming,” they said.
GoAir’s promoters said the company continues to seek financial assistance with the government “so that we can, most importantly, improve the position of our employees and also the sustainability of our airline”. GoAir is also in talks with banks, lessors and suppliers for the same. “Our discussion with lessors, partners and suppliers is progressing with most industry related players being understanding and willing to work with us to try to find suitable solutions,” Nusli and Jeh Wadia said.
GoAir will resume flights in phases once the lockdown is lifted, and expects a full recovery within a few months thereafter, the promoters said. “In preparation to resume operations we have reviewed and are executing all the requirements related to health and safety in the context of the pandemic,” the letter read.
Amid severe cash crunch, India’s second largest airline SpiceJet will not be paying its pilots for April and May. Other airlines like Air India and Vistara have also introduced cost-cutting measures like reducing allowance and sending some employees on unpaid leave for several days. India’s largest airline, IndiGo, meanwhile, had earlier decided to cut April pay, but later reversed the decision.
