As pay problems persist, pink slips are out at Jet Airways

The airline has been defaulting on salaries for some time, making partial payments in some cases or not paying at all, as it continues to lose money mainly in domestic routes where it can't raise fares facing competition from low-cost airlines.

Financially distressed Jet Airways told its employees on Monday that salary delays would continue till March, as it struggles to arrange funds.

The airline also continued to lay off people in small chunks, with about 16 people getting pink slips in the latest tranche, a PTI report said on Monday.

“We would like to assure you that all salary arrears would be cleared on priority so that effective April 2019 the payroll is current," Rahul Taneja, chief people officer, wrote to employees, adding that 25 per cent of September salary would be remitted on December 4.

Some pilots and senior executives were paid only 75 per cent of their September salary, and are yet to be paid full salary for October.

The airline has been defaulting on salaries for some time, making partial payments in some cases or not paying at all, as it continues to lose money mainly in domestic routes where it can't raise fares facing competition from low-cost airlines.

The PTI report, quoting a source, said the laid off employees were working as ground staff in Jet's Kochi and Hyderabad offices.

"The airline continues to layoff people from various departments in small groups. It has already shut its city office in Hyderabad, which had 4-5 employees.

"Last week, the airline asked some of its employees working in Kochi office to quit. Together, it has retrenched another 16 people from these two offices," the source told PTI.

A quick turnaround of the airline's fortune remains unlikely as prospective suitors like Tata Sons have decided to go slow in buying stake.

Tatas have confirmed the group is interested in the airline but sources said that any deal hinges on if promoter Naresh Goyal relinquishes control.

The airline reported a net loss of Rs 1,280 crore in the three months ended September 30, excluding its units.

It had a net profit of Rs 496 million in the same period a year earlier.

The airline, partially owned by UAE national carrier Etihad Airways, has been suffering from the cash crunch for the past few months.

A few days ago, its pilots had earlier threatened its management of "non-cooperation" over further delays in the disbursement of their salaries but to no avail.

The airline said as part of the turnaround strategy, which comprised a comprehensive network review, capacity was being moved from uneconomical and point-to-point routes to the airline's hubs at Mumbai and Delhi for denser, more profitable and productive operations.

“Consequently, the company is optimising its resources in select cities, including re-deploying resources where needed, for greater synergy with the revised level of operations," the spokesperson said.

Photograph: Reuters