IndiGo Slashes Salary Up to 25% as Coronavirus Toll Rises

New Delhi, March 19, 2020:

IndiGo airlines have decided to cut down salaries up to 25 percent due to the novel coronavirus crisis, which has contributed to India’s already existing economic slowdown.

IndiGo CEO Ronojoy Dutta on Thursday informed the employees about a company-wide salary cut in a cost-cutting exercise. According to reports, Dutta stated about taking a 25 percent cut in the salary and other executives, who are above the senior vice president level would have to deal with 20 percent reductions.

"With the precipitous drop in revenues, the very survival of the airline industry is now at stake," Dutta said in his email to employees. "We have to pay careful attention to our cash flow so that we do not run out of cash."

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"With a great deal of reluctance and a deep sense of regret, we are therefore instituting pay cuts for all employees, excluding Bands A and B, starting April 1, 2020," the chief executive officer said.

He intimated the information through an email and stated that vice presidents and pilots would have to bear a 15 percent cut, and others, including cabin crew, would be in for 5-10 percent deductions.

The IndiGo CEO said that "We know how hard it is for families to take a cut in take home pay. But unfortunately, it is impossible for our company to fly through this economic storm without all of is making some sacrifices.”

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It may be mentioned here that IndiGo had spent Rs 3, 210 crore on salaries last financial year, which is about 11 percent of the airline's total expenses. Dutta's mail came hours after IndiGo informed that the company would be taking some “tough calls” over the next few weeks.

It may be mentioned here that the health crisis caused by coronavirus has led to a severe shutdown of small big businesses across the world due to fear of infection.

As coronavirus continues its toll on India’s aviation sector, the pain has now reached the employees, with two of the largest carriers talking about cutting salaries.

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National carrier Air India is also mulling on salary cuts by 5 percent amid growing financial woes. Earlier, an industry advisor had said that most airlines are staring at bankruptcy by May-end if the coronavirus situation persists.

It needs mention here that Italy has recorded 475 deaths, the highest number internationally in just 24 hours due to novel coronavirus or COVID-19 in the country, taking the overall death toll to 2,978 as on Thursday.

India has a total number of reported novel coronavirus cases of 169, with 30 fresh cases reported from various parts of the country. The number includes 25 foreign nationals and the three persons who died in Delhi, Karnataka and Maharashtra. A fresh death has been reported from Punjab on Thursday evening.

219,265 people have been infected with the novel coronavirus globally, out of which, 124,552 are currently active or currently infected cases and 6,814  are in critical condition. 8,969 people have died so far according to https://www.worldometers.info/coronavirus/

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