Indigo - India's largest airline by market share - said on Monday it would lay off 10% of its workforce as a fallout of the disruptions caused by the COVID-19 pandemic to the aviation sector.
The low-cost budget carrier currently operates only a small fraction of its 250 aircraft, the company said in a statement attributed to its CEO Ronojoy Dutta.
Earlier in the year, the airline had undertaken cuts including leave with pay, pay cuts and other cost cutting measures but these measure were not enough, the airline said.
"...From where things stand currently, it is impossible for our company to fly through this economic storm without making some sacrifices, in order to sustain our business operations. Therefore, after carefully assessing and reviewing all possible scenarios, it is clear that we will need to bid a painful adieu to 10 per cent of our workforce", the statement said.
According to the statement, it is the first time that the company would be undertaking such measures, and that the in the early days of the pandemic (March and April), the company claims to have paid all salaries in full.
Further, the airline outlined a 'care-package' for its staff to be laid off, including severance and notice pay, bonuses to eligible employees even after layoff, and company health insurance coverage through December this year.
As of March 2019, Indigo had 23,531 employees. A representative of the airline did not respond to BOOM's queries on the current figure of employment at the time of publishing.
According to the airline's earnings call in early June the airline spent ₹43.9 billion on employee costs in the year ending March 2020.
Indigo controls about 48% share of the civil aviation market in India.
Last week, national carrier Air India announced that it would send staff on leave without pay for anything between six months to two years, extendable to five years, as a cost-cutting measure.
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