GoAir writes to employees about deferred salaries, says not left with any other options
New Delhi : Low-cost private airline GoAir on Monday informed its employees that the company has no reserve funds to pay immediate salaries. The company is also awaiting an announcement from the government that could provide some aid.
GoAir Chairman Nusli Wadia and MD Jeh Wadia wrote a joint letter to employees of the company indicating that there is “no inflow of cash” due to both domestic and international travel being suspended for over a month now to contain the spread of Covid-19.
They said that the company has been “left with no choice” but to pay the pending March salaries over March and April.
Amid the growing coronavirus cases, the aviation sector has taken a huge hit as all the flights have been grounded.
GoAir has managed to pay full salaries to 40 per cent of total employees (2,500), it said while the remaining employees are getting paid on a graded or deferred basis.
“With no inflow of cash, which we are now anticipating will continue through the end of May, a period of over 10 weeks, and with no support forthcoming yet from either the government or the banking system, we were left with no alternative but to make the unfortunate and sad decision to pay the March earned salaries over March and April,” the joint letter said.
“The limitations on our resources are not of our own making and the sacrifices we are imposing on you are sadly beyond our control,” the letter to the employees read.
Also, the company had recently sent its most of the employees on leave without pay due to coronavirus pandemic.
“Our CEO has taken a 50 per cent pay cut and voluntarily deferred most of his balance compensation. The senior management, too, has taken substantial pay cuts and have also deferred a portion of the compensation,” it read.
The management top brass also mentioned how airlines in the United States, Europe, South/East Asia and the Middle East are getting significant support from their respective governments to tide them through this “unprecedented crisis”.