Covid-19 effect: IndiGo extends leave without pay, Vistara announce paycuts

IndiGo had implemented one to five days leave without pay in May, effectively taking the total days of no pay to 10 days.
To reduce cash burn while revenues remain under pressure, India’s largest domestic carrier IndiGo on Tuesday expanded 5.5 additional days of leave without pay per month for its pilots, effective July, for its pilots. IndiGo had implemented one to five days leave without pay in May, effectively taking the total days of no pay to 10 days.

In a statement, the airline said, “IndiGo was one of the few airlines globally to give out full salaries in the months of March and April, despite business disruption. We employed the first paycut in May, followed by leave without pay. Given the current capacity utilisation, we have had to announce further leave without pay for pilots, which is a temporary measure. It will be reviewed basis the changes in our operational capacity.”

Vistara has, meanwhile, initiated 5-20 per cent paycut for its staff and reduced the base flying allowance for pilots from 70 hours to 20 hours till December.

“We are now operating at less than 30 per cent of our original network and the passenger loads on our flights are not as strong as they were before the lockdown. Our financial performance will continue to be negatively affected by Covid-19, even as travel confidence and demand will take a while to recover to pre-Covid-19 levels,” Vistara Chief Executive Officer Leslie Thng said in a staff email.

Thng will take 20 per cent cut in salary from July to December, while other employees will take 5-15 per cent cut, depending upon seniority and scale. Around 60 per cent of employees whose salaries are less than 50 per cent will not be impacted by the paycut.

A month after resumption of flights, the civil aviation ministry had allowed airlines to increase capacity from 33 per cent to 45 per cent. However, airlines are still operating below 33 per cent; loads are still between 55 per cent and 60 per cent.

No-frills carrier SpiceJet has also cut domestic and international layover allowances for its pilots.


Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel