News: Pay cut for Vistara staff to continue till March

Compensation & Benefits

Pay cut for Vistara staff to continue till March

The pay cuts continue as the aviation sector continues to grapple with low passenger volumes and travel restrictions by various countries.
Pay cut for Vistara staff to continue till March

Vistara, the joint venture of Tata Group and Singapore Airlines, will continue with pay cuts of its staff till March but will do away with the three-day leave without pay for pilots effective from January 1. For the pilots, the carrier will implement a 10 percent salary cut while at the same time increase their monthly base flying allowance to 40 hours from 20 hours at present, a Vistara spokesperson said in a statement.

"The pay cut scheme at Vistara will continue to be in effect until March 31, 2021, as part of which the Vistara CEO will continue to take the maximum cut of 25 percent in monthly pay," the spokesperson stated.

The announcement comes as Vistara had announced last September that it will review the salary cuts in January. In June last year, Vistara had announced a reduction in salary of its nearly 40 percent of the total workforce till December 31 on account of weak passenger demand in the wake of the pandemic and the resulting cash flow situation..

For pilots, who were getting base flying allowance since April, which is a fixed component of the salary, for 70 hours per month, the allowance was reduced to 20 hours till December 31.

In September, the airline also introduced a three-day 'Leave Without Pay' for the pilots.

"COVID-19 continues to have an industry-wide impact on business, despite improvement in the operating environment. While we currently deploy nearly 70 percent of our pre-COVID-19 capacity, our operating revenue is still at a significant distance from normal levels," the Vistara spokesperson added.

In this direction, the airline continues to take several measures to control operational expenditures, including containment of staff costs. Employees at the junior levels, whose monthly cost-to-company equals or is more than Rs 50,000, will be affected by a 5 percent monthly pay cut.

Meanwhile, for pilots, a monthly 10 percent pay cut will be applicable. However, their monthly base flying allowance will be increased from the current 20 hours to 40 hours. The scheme does not impact nearly 60 percent of Vistara's staff at junior levels.

The pay cuts continue as the aviation sector continues to grapple with low passenger volumes and travel restrictions by various countries. Though the scheduled international commercial operations remain suspended since March 23, the domestic demand though has been on an uptick sequentially since the resumption of services from May, however, it has not yet matched the pre-COVID-19 level. Till such time, employee remuneration looks likely to be affected.

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Topics: Compensation & Benefits, Employee Relations, #COVID-19

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