SpiceJet has hiked salary of its captains and senior first officers by around 20 per cent from October as it gets the first tranche of funds under the government's credit guarantee scheme, according to an internal communication.
The loss-making Ajay Singh-promoted carrier is also expected to deposit TDS of all employees in next two to three weeks, as per the communication sent to the airline pilots on Wednesday.
The communication to the airline pilots came on the day it sent 80 of its cockpit crew on Leave Without Pay for three months and aviation regulator DGCA announced that it has extended the 50 per cent restrictions on its flights till October 29.
On September 2, airline sources had told PTI that the carrier was likely to receive around Rs 225-crore under the government's credit guarantee scheme ECLGS.
“SpiceJet has received the approval for a loan under the central government's ECLGS scheme. The first tranche of the payment has already been received,” SpiceJet Chief of Flight Operations, Gurcharan Arora stated in the communication.
He, however, did not mention the quantum of funds received in the first installment.
Under the scheme, announced in May 2020 in the wake of the pandemic to help various sectors, entities will get credit at a concessional rate of 7 per cent.
On August 17, the Union Cabinet approved enhancing the limit of ECLGS by Rs 50,000 crore to Rs 5 lakh crore.
Arora also informed the pilots that the second installment of funds under the scheme is also expected “soon,” and added that the company “is working to raise an additional USD 20-million.”
Facing financial headwinds amid high fuel cost and a weak rupee against US dollar, SpiceJet posted a net loss of Rs 789 crore for June quarter as well as Rs 458 crore for the quarter ended March 2022.
According to the communication, the airline has every month been working towards enhancing the base salary of its pilots with the salary of line captains increasing 6 per cent in August.
“Keeping with our commitment of increasing salaries in a calibrated manner as our business improves, the salary for October will see an increase of around 20 per cent for our captains and senior first officers,” Arora said.
The TDS will take a few days to reflect in the pilots tax credit statement. Similarly, a significant portion of PF contributions of all employees will also be credited, as per the communication.