As we know corona-virus crisis is a serious problem which has suspended all the flights. The airlines are suffering and are on the verge of being insolvent. Thus Indigo has decided to cut off salaries of senior employees in the beginning of the month. It will also implement limited, grade leave without pay program for the coming months. Till the problem of funds is solved as the bookings are cancelled until further orders and revenues of the aviation industry are hit hard.
Airlines As the company paid full salaries in the month of March and April, with the leakage of cash it seems difficult for the company to pay off salaries in coming months so it decided to cut off the salaries grade wise. The leave without pay will range from 1.5 to 5 days depending upon employee group. Level A workers are the majority of the workforce who will not be impacted by all this.
The Presidents and Vice presidents are taking a 20-25% pay cut voluntarily to mind the situation. Cock pit crew will take a 15% cut along with a 10% cut by the cabin crew members. The airlines are about to lose Rs 17000 crore this year according to Crisil credit rating agency.
In a nut shell, each industry is hit by the sudden and unexpected out burst and is dependent on the retained earnings over the years which reflect the position in the economy during the pandemic. The condition is severe and is uncertain to make further decisions. Thus, to keep in mind the welfare and survival of the company pay cut offs is the only option to gather the fund in re starting the company after the lockdown.