Jet Airways' financial woes: Pilots warn of 'non-cooperation' over non-payment of salaries

Though the Jet Airways shareholders have approved a debt rejig plan for the Naresh Goyal-led airline, pilots are yet to receive a part of their November salary. Frustrated over the inordinate delay in disbursement of salaries, pilots have now issued a stern warning to the airline authorities. In a communication, pilots warned of "non-cooperation" from March 1 if the airline authorities fail to disburse their salaries. The Jet Airways Pilots Union is expected to get an update on the matter by Monday.

"(Around) 25 per cent of November salary will be paid on 26 February. Discussions for further payout to continue. Expect an update on 25 February. In case of unsatisfactory outcome, non-cooperation will begin from 1 March," National Aviator's Guild (NAG), which comprises over 1,135 pilots as its members, said in a statement, reported Mint.

Grappling with acute financial woes, the full service carrier is looking to restructure debt and raise funds. Jet Airways has been making salary payments to many of its employees, including pilots, in a staggered manner, amid financial crunch. Reports suggest that the state-run lender SBI is also mulling moving the National Company Law Tribunal as it feels the airline is running out of funds for operations.

Shareholders of Jet Airways had approved conversion of loan into shares and other proposals during the Extraordinary General Meeting (EGM) on Thursday. A consortium of banks, led by the SBI, has extended loans to Jet Airways, which is looking to rejig debt and raise funds.

Officials associated with the lenders and key shareholders said the SBI was considering moving the NCLT seeking insolvency proceedings against Jet Airways since it was running out of money for operations. Lenders can initiate proceedings under the Insolvency and Bankruptcy Code (IBC) to recover dues from debt-laden entities. The process can commence only after approval from the NCLT.

The officials said that Gulf carrier Etihad, the strategic partner with 24 per cent stake in Jet Airways, abstained from voting on various proposals during the EGM held on February 21. Etihad was waiting for clarity on the overall funding that the SBI and National Investment and Infrastructure Fund (NIIF) would provide for Jet Airways in terms of equity, suggest reports.

Edited by Manoj Sharma with agency inputs

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