The Indian Airline SpiceJet has proposed reductions in employees’ salaries. The airline’s economic condition has slumped. Amid a spike in Covid-19 brought a downturn to travel demand. SpiceJet is holding up to 50% of its employees’ salaries in April.
Challenges faced by the airline
SpiceJet is in a poor economic state. The domestic passenger demand has lowered, and the airline cannot profit from its flight operations. Earlier in March, SpiceJets’ passenger figure decreased to over 300,000 flyers. This situation got worse in the mid of April when India got struck by an acceleration in Covid-19 cases. SpiceJet is quickly under high economic pressure due to falling revenues, with the airline saying in an internal mail,
“The deadly Covid-19 second wave has resulted in the country’s worst-ever crisis, with the aviation sector again bearing the biggest burnt. Unfortunately, we have been forced to implement certain tough measures to secure the long-term interest of the SpiceJet family. There will be no salary cut for any employee. However, under these extreme and unavoidable circumstances we are enduring, we are forced to implement a graded salary deferment for some of our employees.”
The airline had to take measures to secure its current position in the market. Therefore, SpiceJet will hold 50% of its employees’ salaries in April. The deferrals will range between 10-50% depending upon the pay scale of the employee. The airline management also plans to return these deferrals to each employee once the carrier is economically stable.
Petition by SpiceJet Employees’
SpiceJet employees’ have started an online petition. The petition is against the decision by the carrier’s management team. It comprises of all the details about salary reductions made to employees’ salaries. The workforce is not happy with the decision of airline management since the employees’ have been working consistently by putting their lives at stake.
In response to the petition, the management team emphasized ensuring the safe return of deferrals. Meanwhile, the management team said that they will hold some employees’ salaries only for now.
SpiceJet is an Indian low-cost carrier with hubs in Delhi and Hyderabad. The airline operates over 600 flights daily. The company is acquired by an Indian Entrepreneur, Ajay Singh. Currently, SpiceJet is flying to 64 destinations, including 54 domestic and 15 international destinations. The airline has a fleet size of 121 aircraft, including Boeing 737 and Bombardier 8 aircraft.
SpiceJet in the year 2020
Last year in April, SpiceJet stopped its employees’ salaries for straight two months. The airline only paid employees according to their working hours. Yet, again this year, the airline is adversely impacted by the second wave of Covid-19. The airline is struggling to cope up with economic pressure. Therefore, there is very little chance of SpiceJets’ imminent recovery.