IndiGo announces second round of deeper pay cuts after 10% of the employees were laid off

BCCL
  • In an email sent to the employees, CEO Ronjoy Dutta said, “As part of our ongoing efforts to adjust our cost structure down in line with reduced revenues, I am afraid we need to take deeper pay cuts for ourselves.”
  • The email said the increased pay cut will be in effect from September 1, and pay for all other employees will remain as per May announcement.
  • The email also warned that from September onwards, each department will decide on leave without pay for each month based on workloads and staffing levels.
IndiGo announced the second round of deeper pay cuts for employees as pessimism around the travel industry continues to hurt the airline’s operations.

In an email sent to the employees and accessed by Business Insider, CEO of India’s largest domestic carrier, Ronjoy Dutta said, “In May of this year, we had implemented pay cuts of varying percentages, across the board for all employees, except for bands A and B. As part of our ongoing efforts to adjust our cost structure down in line with reduced revenues, I am afraid we need to take deeper pay cuts for ourselves. To cushion the impact among lower-paid employees this time around, we will increase the pay cut percentages only among the employees at the very top of the pay pyramid.”

IndiGo spokesperson has refused to comment on Business Insider’s query for now.

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As per the email, Dutta has increased his personal pay cut percentage to 35% and is asking all senior vice presidents and above to take a 30% pay cut.

“All pilots will see their pay cut percentages increased to 28%, all vice presidents will take a 25% pay cut and associate vice president will take a 15% pay cut,” Dutta said.

The email said the increased pay cut will be in effect from September 1 and pay for all other employees will remain as per May announcement.

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The email also warned that from September onwards, every department will decide on leave without pay for each month based on workloads and staffing levels.

This move comes a week after the company announced that it will lay off 10% of its workforce due to the economic turbulence. It also announced pay cuts, leave without pay, and various other cost-cutting measures in May; but unfortunately, those cost savings were clearly not enough to offset the decline in revenues.

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