Indian carrier Vistara has decided to get to rid of the pay cut which it had implemented last year. The pay cut will no longer apply to certain categories of employees from April 2021 onwards. The pay cut will continue to apply to salaries of management-level executives, including the CEO, explained an e-mail sent to the Vistara staff members.
Vistara, which is a joint venture of Tata Sons and Singapore Airlines, had announced a nearly 40 per cent reduction in salaries of its employees in June 2020. The pay cut was to continue till December 31, 2020, but was later extended to March 31, 2021. The pay cut was introduced to deal with the low cash flow amid weak passenger demand during the COVID-19 pandemic.
"Our board has approved to cease the pay cut that was implemented for level-1 to level-3 staff from April 1, but the leadership team (level 4 and level-5) and I will continue with our pay cuts at 15 per cent and 25 per cent, respectively," Vistara CEO, Leslie Thng said in the communication. These developments were confirmed by a Vistara spokesperson, according to PTI.
Thng had explained in the e-mail that the airline had not yet fully recovered; operating capacity and revenue were still below pre-COVID levels. He added that the road ahead for the airlines will continue to be challenging as per the current state of the COVID-9 pandemic.
"We must remain vigilant in controlling our costs and be nimble and flexible in our plan and should be able to take difficult decisions if the need arises," Thng said.
The airlines will not be paying any annual increment in April 2021. However, it will review increments in October based on the airline's financial position in the first two quarters of the next fiscal.
However, for staff, which is eligible for variable performance for financial year 2020-21, payments will be made in May based on company and individual staff performance in this financial year, Thng added.