The Indian Aviation sector has taken a drastic hit due to the outbreak of Covid-19. Since the government announced the lockdown period to combat the deadly virus, all the airlines incurred massive financial losses. Also, the occupancy in domestic airlines was slashed to nearly 50% since May 25, 2020. All the airlines are taking multiple steps to reduce the financial burden and operate without any hassle. Recently the largest carrier of India, IndiGo announced job cuts of its employees to reduce the financial burden of the airline. However, the government-owned carrier Air India has stated that no employee of Air India will lose their job in the stressful period. Air India discussed the rationalization of staff cost in a meeting at the Ministry of Civil Aviation and announced the decision on its official Twitter account.
Air India has Reduced Employee Allowances
Though Air India has announced that no employees will lose their jobs, the airline has reduced employee allowances to reduce the financial distress caused under challenging times. The airline has reduced the allowances of employees who have a monthly gross salary of more than Rs 25,000 by up to 50%. However, the airline has not cut the basic pay, HRA and DA. The airline has also stated that the rationalization of allowances will be reviewed once the financial position of the airline improves. Air India has also asked the departmental heads and regional directors of the airline to identify the employees based on various factors like efficiency and health who will be sent on compulsory leave without pay for up to 5 years. Also, employees will get the option to take up LWP scheme voluntarily.
IndiGo Will Slash 10% of Workforce to Reduce Financial Loss
The largest carrier of India, IndiGo, is also facing a massive financial burden due to the outbreak of Covid-19. The airline posted a net loss of Rs 871 crore for the January-March quarter of 2020. To remove the financial burden, IndiGo is cutting down on 10% of the total workforce. IndiGo has stated that the impacted employees will get three months gross salary and extended medical insurance. Also, the carrier will not let go of their pilots in the entire process.