The 13200 strong employee base of Jet Airways of Naresh Goyal would be maintained albeit with pay cuts ranging from 25% on the higher side to 5% for lower salaried employees to avoid retrenchments (the so called ‘pink slips’ of the Western world). Last month Jet Airways sacked 1900 employees, before company chairman Goyal reinstated the tear eyed employees, in an emotional outburst, terming the employees as his own children.
At a meeting held on 23rd Nov’08, at the Renaissance Hotel convention centre in Mumbai, the employees, barring the pilots, accepted a pay cut formula, in principle, to save the loss making airlines in these days of economic meltdown. The formula is broadly as below.
- 25% cut for Vice-presidents and above ranks.
- 20% cut for those earning over Rs.5 lacs ($10000) per month
- 10% cut for those earning over Rs.2 lacs ($4000) per month
- 5% cut for employees drawing between Rs.75000 and Rs.2 lacs per month
- No pay cut for those drawing less than Rs.75000 pm for the present.
Jet Airways has strength of about 5000 employees who receives in between of Rs.75000 and 2 lacs per month.
According to an official of the airlines, all management staff, engineers and commercial staff has agreed to the pay cut. But the pilots have rejected the proposals outright conveying that the company should first sack 200 foreign pilots who draws 40% more salary than the senior-most Indian pilots.
The airline has about 1000 Indian pilots many of whom have no work after the airlines pruned some of the scheduled routes as a cost cutting measure due to poor occupancy on those routes. Pilots will have further meetings with the management to place their suggestions by Thursday the 27th Nov’08.
However this model of working out crisis management, by both the employees and the authorities, may be a role model for future actions for many corporate houses so that bad times can be tied over without retrenchment.
It is necessary here to take stock of some important facts about Jet Airways. Based in Mumbai, the airline operates about 400 flights daily serving 64 destinations. In July’08, it was adjudged as world’s best long-haul airlines after Singapore Airlines. In India, with a Fleet of 85 aircrafts, it is the second largest international airlines after Air India and is the largest domestic airlines with a market share of about 29.8% including 7.1% of it cheaper subsidiary JetLite.
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