IndiGo, one of the largest airlines in India, has
announced that it will layoff 10% of its workforce.
The ongoing COVID19 pandemic has impacted
many industries around the world, amongst which aviation has been
one of the sectors that has been impacted the hardest.
Even now, with some travel restrictions around the
globe being gradually eased, IndiGo is only flying a small percentage
of its full fleet of 250 airplanes.
The airline employs around 24,000 people.
In a statement issued on Tuesday, Ronojoy Dutta,
CEO, IndiGo, said, "Right at the start of this crisis, IndiGo
understood the gravity of the situation. For us, it was critical
to minimise the impact of the pandemic on our employees and in
fact IndiGo was one of the few airlines globally which paid full
salaries for the month of March and April 2020, despite the
disruption in business. Subsequently, we did have to undertake a
number of measures such as pay cuts, leave without pay and various
other costs; but unfortunately, these cost savings are clearly not
enough to offset the decline in revenues. And 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. Therefore, after carefully
assessing and reviewing all possible scenarios, it is clear that
we will need to bid a painful adieu to 10 per cent of our
workforce. It is for the first time in the history of IndiGo that
we have undertaken such a painful measure. This is indeed a very
unfortunate turn of events from the optimistic growth trajectory
we had carved out for ourselves just six months ago; but this
pandemic has forced us to re-evaluate our best laid plans."
In an attempt to try and help the impacted
employees, the airline has said that it will:
Notice Pay in lieu: Impacted employees will
be paid notice pay in lieu of serving notice applicable to them.
This will be calculated on the gross salary, basis the employee’s
Severance Payment: In addition to notice
pay, impacted employees will be paid a severance pay which will be
calculated as one month of CTC for every completed year of
service, subject to a maximum of 12 months. This will lead to
higher cash in hand in comparison to calculations on gross salary.
At a minimum, an impacted employee will receive at least 3-months’
gross salary, including both the above payments.
Annual Bonus / Performance Linked Incentive
(PLI) (for Non- crew), FY 2019 – 20: Payment of bonus / PLI shall
be made when the company decides to make this pay-out to the rest
of the employees in this financial year, even after the impacted
Longevity Bonus (Crew):
For year 2020, longevity bonus shall be paid to eligible crew
members. This bonus is only applicable for cabin crews.
Coverage for impacted
employees will be extended until December 2020. There shall also
be a provision to continue with the policy post December 2020 as
per applicable market rates. For those employees who had covered
their parents via the policy, such insurance will also be extended
until December 2020. As is currently existing, payment will be
borne by the employees.
In addition to other forms of support, the airline
has said that it will also offer impacted employees with a one way
confirmed air ticket should they need to travel back to their
hometown or base location.