Following is an extract of an article that appeared in today's ET:
"Jet Airways has informed its employees that they will have to take a salary cut of up to 25% as the cost of operations for the airline is increasing due to the rising crude prices and falling rupee."
Please share your views on how justified and legal this pay cut is, and under such circumstances, what should be the approach of Jet Airways.
Regards,
Rahul Chhabra
From India, Delhi
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157"Jet Airways has informed its employees that they will have to take a salary cut of up to 25% as the cost of operations for the airline is increasing due to the rising crude prices and falling rupee."
Please share your views on how justified and legal this pay cut is, and under such circumstances, what should be the approach of Jet Airways.
Regards,
Rahul Chhabra
From India, Delhi
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The challenges facing the aviation industry are many. High wages for staff, intense competition, and increasing oil prices are some of the key issues. Legally, the airlines have asked people to accept pay cuts, and once accepted, there is no illegality. The staff concerned must understand that non-cooperation may result in the airline becoming bankrupt. Indigo is also facing financial pressures. Strengthening crude oil prices, a strong dollar versus a declining rupee, are adding to costs, while severe competition is denting the bottom line. The approach of the airline should be to increase revenue to overcome the present crisis.
From India, Pune
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From India, Pune
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Dear Colleague,
When things come to this point of asking staff to accept a pay cut, it has to be as a last resort after other ways of cost-cutting have been tried out first. Furthermore, all staff should be taken into confidence and communicated with in a transparent manner regarding the need to share the hardship during this difficult period in the company's life.
Just as staff share in the prosperity of the company, they also share in its adversity. However, the pay cut must apply to all employees, and the CEO should set an example by accepting it first.
One can debate endlessly on the legality or otherwise of this pay cut, but when it comes down to it, such measures unfortunately have to be resorted to.
Regards,
Vinayak Nagarkar
HR Consultant
From India, Mumbai
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When things come to this point of asking staff to accept a pay cut, it has to be as a last resort after other ways of cost-cutting have been tried out first. Furthermore, all staff should be taken into confidence and communicated with in a transparent manner regarding the need to share the hardship during this difficult period in the company's life.
Just as staff share in the prosperity of the company, they also share in its adversity. However, the pay cut must apply to all employees, and the CEO should set an example by accepting it first.
One can debate endlessly on the legality or otherwise of this pay cut, but when it comes down to it, such measures unfortunately have to be resorted to.
Regards,
Vinayak Nagarkar
HR Consultant
From India, Mumbai
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Why has Jet Airways resorted to a salary cut of up to 25% is beyond understanding? The reason they cited, i.e., "rising crude and falling rupee," is applicable to all categories of industries in our country. The above cannot be the sole reasons, but there are definitely other factors for which the company adopted a salary cut along with other measures, possibly. Before making such a decision, the company should have discussed it with the people in the company because they are part of the management.
This is a common phenomenon in any industry; therefore, one should remain prepared to accept the bad period as they are transitional. There are other airliners; why did a particular one suffer a setback? It always seems that the workers remain the target.
From India, Mumbai
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This is a common phenomenon in any industry; therefore, one should remain prepared to accept the bad period as they are transitional. There are other airliners; why did a particular one suffer a setback? It always seems that the workers remain the target.
From India, Mumbai
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