The CEO of Jet Airways, Sanjiv Kapoor, tweeted that a report claiming that senior management and 60% of existing staff had been placed on unpaid leave for three months was “100% incorrect information.”
He clarified the situation by stating that no staff are being dismissed in a subsequent tweet.
To clear the air (as many numbers and%s flying around), wrote Kapoor. 1. Only one-third of the staff will be affected; 2. Of the remaining one-third, most will have their pay reduced for temporary positions. 3. Less than 10% of the total will be on temporary LWP. 4. Nobody was let go.
“These are all fine people who have been working hard to try to do what has never been done: resuscitate an airline that has gone bankrupt,” said Kapoor in further clarification. However, certain temporary tough decisions had to be made because the ownership transfer timeframe was sliding owing to events outside of our control.
In addition, Kapoor defended the airline’s owners, the Jalan Kalrock Consortium (JKC), claiming that they are revitalising the company with new funding in order to provide customers more options, generate more jobs, and restore lost positions.
“Jet’s cash shortage and operations suspension were not the fault of the team trying to resuscitate Jet. With new funding, they are attempting to resurrect the airline in order to increase consumer choice, generate new employment opportunities, and preserve existing ones. They merit all of our gratitude,” he wrote.
Earlier, there were rumours that the business, which has yet to resume operations under its new owner, would lower salaries for different staff members and put many workers on unpaid leave due to the uncertainty surrounding the start of its operations. The measures, which take effect on December 1, were made public hours after the winning bidder Jalan-Kalrock Consortium (JKC) warned that managing cashflows might require “difficult” decisions in the near future.
According to a person familiar with the situation who spoke on the condition of anonymity, some of Jet’s 230–250 employees will have their salary reduced by up to 50%, and some may be put on leave without pay until further notice beginning on December 1.
Before that, the Jalan Kalrock Consortium had stated on Friday that it had not violated any provisions of the insolvency resolution plan but may need to make challenging short-term decisions to manage cashflows.
The National Company Law Tribunal (NCLT) granted the consortium’s resolution plan approval in June of last year, but the airline has not yet begun flights despite having its air operator certificate revalidated by the DGCA in May of this year.
“… while we await the handover of the company as per the NCLT process, the longer-than-expected time being taken for the same may result in some difficult but necessary near-term decisions to manage our cashflows to secure the future while the airline is still not in our possession.”The Jalan Kalrock Consortium (JKC) had stated in a statement
The National Company Law Appellate Tribunal (NCLAT), which ordered the consortium to pay the carrier’s employees’ unpaid gratuity and provident fund obligations last month, was also a factor when the statement was made.
“All conditions precedent, as set forth in the resolution plan, were satisfied by May 20, 2022, following the NCLT’s approval, and the required filings in this regard were made before the NCLT on May 21, 2022.”
The statement read, “JKC has deposited 150 crore with the lenders as required under the court approved resolution plan, with the remaining amounts to be invested only after next steps of NCLT are satisfied in terms of handing over the company to us.”
The resurrected Jet Airways will also offer more job options, especially for the airline’s previous employees, who presently make up more than 60% of the existing workforce, as well as for many more as the resurrected airline grows, according to Ankit Jalan, Board Member of the JKC.
Jet Airways was originally scheduled to debut in October 2022.
Jet Airways’ chief executive officer, Sanjiv Kapoor, claimed that all of the LOIs (Letters of Intent) needed to operate an airline are in place, including those for aircraft, engines, IT systems, ground handling services, catering, call centers, and other services.
The NCLAT had ordered the consortium to pay the carrier employees’ unpaid gratuity and provident fund contributions last month.
Additionally, the appellate tribunal had instructed the former airline resolution specialist to “calculate the payments to be provided to workers and employees within one month from today” and send the results to the consortium in order to initiate the payment.
This week, Kalrock Capital stated that the acquisition of Jet Airways will not be impacted by the continuing inquiries into its promoter Florian Fritsch in other countries. Regulating bodies in Liechtenstein, Switzerland, and Austria are investigating Fritsch.
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