IndiGo will lay off 10 per cent of its workforce in view of the disruption due to the coronavirus pandemic, announced its CEO Ronojoy Dutta. In a statement on Monday, Dutta said that the ongoing pandemic has forced the airline to deviate from its growth trajectory charted six months ago
"From where things stand currently, it is impossible for our company to fly through this economic storm without making some sacrifices, in order to sustain our business operations. Therefore, after carefully assessing and reviewing all possible scenarios, it is clear that we will need to bid a painful adieu to 10 per cent of our workforce," said Dutta.
As on March 31, 2019, the airline had 23,531 employees on its payroll.
"It is clear that we will need to bid a painful adieu to 10 per cent of our workforce. It is for the first time in the history of IndiGo that we have undertaken such a painful measure. This is indeed a very unfortunate turn of events from the optimistic growth trajectory we had carved out for ourselves just six months ago; but this pandemic has forced us to re-evaluate our best laid plans," Dutta further said.
In addition to notice pay, Dutta said IndiGo will pay laid off employees a severance pay which will be calculated as one month of CTC for every completed year of service, subject to a maximum of 12 months. At a minimum, an impacted employee will receive at least 3-months' gross salary, including both the notice and severance payments. Those with higher tenure with the company will receive, the airline stated.
IndiGo will pay longevity bonus for the year 2020 along with full and final payment to eligible crew members. This bonus is only applicable for cabin crews. Medical insurance coverage for sacked employees will be extended until December 2020, the airline said, which can be further extended as per applicable market rates.
Earlier this month, IndiGo had announced fresh salary cuts to lower costs amid plummeting revenues. The airline had reportedly written a mail to its pilots informing them of 5.5 days of leave without pay. With this, IndiGo extended the leave without pay (LWP) policy to 10 days, effective from July 1. Moreover, the Gurugram-based airline also slashed salaries of under-training transition captains and transition first officers by over 45 per cent.
In May, IndiGo initiated 20-25 per cent pay cuts for senior staff, including pilots. It also started a graded leave-without-pay programme for all its employees until July.