IndiGo lays off 10% of its workforce due to COVID-19

IndiGo, India's largest private airlines, has announced to lay off 10% of its workforce due to economic crisis induced by COVID-19 pandemic, its chief executive officer Ronojoy Dutta said. "It is for the first time in the history of IndiGo that we have undertaken such a painful measure," Dutta said in a statement.

"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," Dutta added.

"Therefore, after carefully assessing and reviewing all possible scenarios, it is clear that we will need to bid a painful adieu to 10% of our workforce. It is for the first time in the history of IndiGo that we have undertaken such a painful measure," he added.

The airlines have been facing a severe cash crunch due to the disruption caused by COVID-19 outbreak. The domestic and international flight operations were shut in the last week of March to prevent virus spread. After a gap of two months, the civil aviation industry resumed the domestic flight operations in a limited manner on May 25. At present, the domestic airlines can operate with 45% capacity. Earlier, airlines were allowed to operate with only one-third of capacity when flights resumed. IndiGo said the airlines is flying only a small percentage of its full fleet of 250 airplanes.

IndiGo has created a “6E care package" for the impacted employees under which they will be given "notice pay", calculated on the basis of gross salary, in lieu of serving notice applicable to them.

In addition to the notice pay, they will be paid a severance pay which will be calculated as one month of CTC (cost to company) for every completed year of service, subject to a maximum of 12 months, he said in the statement.

“At a minimum, an impacted employee will receive at least three months’ gross salary, including both the above payments," the statement read.

“This has been one of the toughest decisions that we have had to take and we are ensuring that the transition process for the impacted employees is carried out seamlessly, professionally; and with the utmost respect and compassion. We would like to express our heartfelt gratitude and sincere thanks to all our people who have stood by us through thick and thin; and we are confident that both individually as well as collectively, we will emerge stronger out of this crisis," the note added.

The company earlier announced pay cuts for its employees under a 'limited, graded leave without pay program for the months of May, June and July. Indigo CEO Rononjoy Dutta in a mail to employees, said, "No option but to implement pay-cuts from the month of May. Have to implement limited, graded leave without pay program for May, June & July."

All the airlines such as SpiceJet, GoAir and Air India, have either cut salaries or have sent a major part of their staff on leave without pay. COVID-19 pandemic has severely affected all the Indian carriers.

Source: https://www.livemint.com/

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