September salaries of more Jet employees delayed due to fund crunch

Jet Airways had already delayed the salaries of its pilots, engineers as well as senior managers because of a financial crisis. The Airline has now held back salary payment to employees of other grades and categories as well.

It is reported that the employees in A1-A5, O2 and O3 grade, or those whose salaries are up to Rs 75,000 per month, were paid on October 1, whereas the rest of the staff belonging to the M2, M3, E1 and above grades have yet to receive their salaries for September.

The Mumbai-based Indian international airline, controlled by Naresh Goyal has been struggling to fulfil its payment obligations, which includes the salaries to its more than 16,000 employees.

There seems to be no end in sight anytime soon for the financial crisis that the Company has been facing.

Jet has also sought an extension to be able to pay the aircraft leasing charges it owes for 17 of its Boeing 737s.

The debt-ridden airline has requested GE Capital Aviation Services (GECAS), the Irish-American commercial aircraft financing and leasing company, to grant an extension. The airline is reportedly struggling to get one of its A330 wide-body aircrafts released from an aircraft maintenance facility, following nonpayment of engine lease.

However, the airline maintains that the aircraft in question is only held back at the facility for routine maintenance work; that Jet has not defaulted in its payment but is simply finding it challenging to fulfill its contractual commitments due to financial issues. According to the Company, it is negotiating to rework the contracts and request an extension to tide over the present crisis.

It is the usual practice in case of such agreements for the lessor to exercise the right to stop the release of aircrafts in case of nonpayment.

Jet Airways carries a debt of Rs 8,620 crore, of which Rs 1,968 pertains to aircraft debt alone.