SpiceJet Delays Salaries, Halts EPFO Deposits
SpiceJet has delayed paying salaries and EPFO deposits amid speculation that it plans to lay off 1,400 staff in order to reduce operational expenses, according to a news report. According to a spokeswoman of SpiceJet, more than 75 per cent of employees have already received their salaries. According to CNBC TV-18, the pension fund deposits will be made in the "near future".
Faced with financial difficulties, legal fights and other challenges, the carrier may ask more employees to quit, as there is currently excess labour relative to the number of aircraft in service. PTI reported on Monday that a final decision on the number of layoffs is due this week.
According to an airline official, the company employs approximately 9,000 people and plans to reduce its workforce by 10-15 per cent. The official noted that layoffs are necessary to cut overall expenses, with annual savings of up to Rs 100 crore.
SpiceJet currently operates a fleet of slightly more than 30 aircraft, with 10 on wet lease.
During a meeting with the airline's senior officials last month, SpiceJet chairman and managing director Ajay Singh emphasised the importance of prudent spending and stated that he will personally oversee all major expenses.
According to an internal memo sent last month, the carrier will prioritise fleet upgrades, improve on-time performance, and implement cost-cutting initiatives to streamline operations.
