Pilots working with Naresh Goyal-led Jet Airways have threatened its management of "non-cooperation" over any further delay in the disbursement of their salaries. The airline is facing deep financial crisis due to high fuel cost and continuously depreciating rupee. A fierce competition from local players have also added to its woes, leading to Rs 1,036 crore and Rs 1,300 crore losses in the quarters ending March and June, respectively. Its total liabilities from banks have grown to over Rs 8,600 crore. UAE's national carrier Etihad holds 24 per cent stake in the debt-ridden Jet Airways.
After meeting Aviation Secretary RN Choubey last month, Goyal had said the airline was planning to raise funds to come out of the current crisis, but trouble seems to brewing as the employees' salaries have been delayed for the second consecutive month.
"Withholding salaries, that too without prior notice, is a serious matter and the management will bear sole responsibility for any repercussions," Jet Airways' pilots said in a communication to the management earlier this week. "We would like to advice that failure to address the above points and not paying the salaries on time would lead to non-cooperation by pilots," they warned.
The Jet Airways pilots have also demanded that "all unnecessary positions and committees/ groups created in the last three months be dissolved with immediate effect and the hiring of the expensive expats (vis-a-vis domestic pilots) be stopped forthwith." "We trust you will treat the above with the urgency it deserves and take immediate steps to resolve the situation," they added.
The airline has an annual salary bill of Rs 3,000 crore. Amid cash crunch, the airline had informed its employees in August that they will have to take a salary cut up to 25% -- 5% for employees earning Rs 12 lakh per annum, 25% for employees earning up to Rs 1 crore, and 17% cut for pilots -- over rising operational expenses. However, the decision was withdrawn after the airline faced criticism from several quarters.
Jet Airways is now in serious damage control mode, with a turnaround plan in place. But banks are getting cagey with handing out more loans to the company; State Bank of India has already put it in stressed accounts watchlist. The company has, however, managed to raise some funds. During an analyst call on August 29, Amit Agarwal, the airline's deputy chief executive and chief financial officer, talked about receiving liquidity support of $300 million in the form of advance lease incentives and borrowings from domestic banks. This leaves Jet Airways with no option but to cut down on expenses.
(Edited by Manoj Sharma)