Budget carrier SpiceJet on September 22 announced a 20 percent salary hike for captains and senior first officers with effect from October, people aware of the matter told Moneycontrol. As a part of the Emergency Credit Line Guarantee Scheme (ECLGS), the airline has received the first tranche Of payment and expects the second tranche soon, they said.
The company will deposit the tax deducted at source (TDS) for all the employees in the next 2-3 weeks and credit a significant portion to their EPF soon.
SpiceJet's decision to hike the salaries of its pilots comes just a few days after the airline decided to send 80 pilots on leave without pay for three months to cut costs. Besides, the Director General of Civil Aviation has also extended the airline's suspension to operate at 50 percent capacity till October 29.
The airline claimed that despite several pilots being sent on leave without pay, it would have sufficient capacity to operate its full schedule as and when the DGCA restriction on flights is lifted.
Most pilots, cabin crew, and ground handling staff in India are underpaid and overworked compared to their international counterparts.
It may be noteworthy that India's top airlines have still not restored the salaries of their employees to pre-COVID levels, citing a rise in fuel costs and limited domestic passenger operations. While, IndiGo is expected to restore salaries of its pilots, cabin crew, and ground handling staff to pre-COVID levels by September, SpiceJet's employees have been struggling with delayed payments.
Despite the entry of airlines like Akasa Air and Jet Airways into the Indian aviation space, salaries and jobs of aviation personnel are not expected to rise for the next few years.
SpiceJet is also looking to raise funds to stay afloat. "We are optimistic about our future and our continued recovery and in order to achieve our future plans the Board has mandated fresh capital issuance and the Company will be shortly engaging with investment bankers for a potential raise of up to US $200 million," the airline had said in a press release last month.
The budget carrier is also said to be in talks with potential investors for a likely stake sale. SpiceJet's promoter Ajay Sigh and his family hold 59.4 percent stake in the airline.
