IndiGo Lays Off 10% of Their Total Workforce
The country's largest low-cost carrier, IndiGo, has decided to lay off 10 percent, or nearly 3,000 of its workforce due to the tough economic crisis caused due to coronavirus pandemic.
Describing it as a 'painful adieu' and a first in its history, IndiGo CEO Ronojoy Dutta informed his employee in a letter on July 20 that IndiGo has decided to lay off 10 percent of its workforce due to the economic crisis caused by the coronavirus pandemic. As on March 31, 2019, the airline had 23,531 employees on its payroll. The number for FY20 is not known but estimates suggest the airline had around 30,000 employees as on June 30.
"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," Dutta said.
Addressing fellow workers in a letter, Dutta said: "The current pandemic has impacted many industries around the world, amongst which aviation has been one of the sectors that have been impacted the hardest. Even now, IndiGo is flying only a small percentage of its full fleet of 250 airplanes," he said.
Commenting about the impact of the pandemic on the business, Dutta said: “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,” Dutta said in a statement. “Therefore, after carefully assessing and reviewing all possible scenarios, it is clear that we will need to bid a painful adieu to 10% of our workforce. It is for the first time in the history of IndiGo that we have undertaken such a painful measure,” he added.
To help the impacted employees’ tide over the uncertainties emanating from this decision, IndiGo has created a ‘6E Care package’. The company said those impacted by this decision 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 notice period.
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, the company said.
"We value the skills and experience they bring to the table," the company said. Therefore, IndiGo has created a directory of those impacted by the decision. "The directory will help us reach out to them, before anybody else, when we see our operations revert to normal. Needless to say, that it is our commitment to first hire such employees back before opening such positions to other applicants," it said.
In addition to the measures, each employee, who has been impacted, will receive a personalized recommendation letter to vouch for their professional credentials, the company said.