One of India’s largest airlines Jet Airways, has informed its staff that they will have to take up to 25 percent cut in their salaries as the cost of operations has increased due to rising crude oil prices and a falling rupee, according to an Economic Times report.
Starting this month, salary cuts will range from 5 percent (for employees earning Rs 12 lakh annually) to 25 percent (for those earning Rs 1 crore and more), the report said. Salary cut for pilots will be in the range of about 17 percent.
The paper quoted an airline source has saying, “There’s no timeline as to how long this reduced salary will continue. Also, there’s no clarity on whether there will be a refund of deducted salary at a later stage. All we know is it starts this month for employees starting from managers to the CEO.”
The airline’s top management has reportedly held meetings with employees on the issue and such meetings are set to continue. The senior management has already taken a pay cut, the report added.
“As part of its cost rationalisation measures, the airline continues to evaluate all initiatives to achieve greater business efficiencies. Payroll is one of the important components of cost structure and the senior leadership has undertaken a reduction in salary to lead by example,” an official from the airline was quoted as saying by the newspaper.
The Nresh Goyal-headed company has an annual salary bill of around Rs 3,000 crore and the cuts are expected to reduce it by around Rs 500 crore.
Pilots are reportedly not happy with the decision and have not agreed to the pay cut. “This move will be resisted by pilots who would not agree as all other airlines are offering salary increases to employees, including pilots,” a senior Jet Airways pilot told the newspaper.