Jet staff to go for the legal battle to get dues

The chance of reviving Jet Airways is becoming less and less likely as the days roll on. With slots going to rivals and aircraft back to lessors, will anyone really want to step in becomes a big question mark? It shows the lenders are not very confident of getting any serious bid.

Jet Airways, the oldest private airline was in India with 124 fleets was profitable routes like connecting India with London and Toronto. Now nearly 16,000 jobs at stake, Now they are heading for the legal battle for recovering their unpaid dues like salary/wages and gratuity ,which runs into several hundred crores and seeing the liquidation may not yield any good outcome,

Being left ‘orphaned’ by everyone including stakeholders and lenders, Jet Airways’ 16,000 employees are heading for a long legal battle to recover their dues of unpaid wages and gratuity running into hundreds of crores. As per the third quarter profit-and-loss account filled, the airline’s employment remuneration and benefits amounted to ₹781.18 crore, which works out to about ₹260 crore per month.The salary dues to all employees upto April 2019 are more than ₹700 crore.The company’s low asset base, a possible liquidation will hardly yield anything...

Sources said, the airline owns 16 aircraft and 10 of them (Boeing 777s) were purchased through U.S. Exim Bank guarantee. The company’s BKC building has also been mortgaged, leaving few assets for sale in case the bidding process initiated by lenders fail.

Jet Airways, which was controlling about 13.6 percent of the local market as recently as January, would require 85 billion rupees to restart operations. So far, it isn’t clear whether Jet Airways will find a buyer to fly again, or the lenders would take it to a bankruptcy court. Few media house had reported on the interstate of Mukesh Ambani and Tata Groups interest to pick up a stake or purchase Jet’s assets.The speculation says, if NCLT admits the case for bankruptcy, then Jet Airways may get the breathing space, by getting a new buyer, again a question raises who will bear the financial loss, who will pay the dues to the banks, investors and employees, which remain a question marks. A person familiar to this industry, raises a query, who made from this debacle of Jet Airways, remains unanswered..


While all employees are to get two months’ salary, including that of April, for high-salaried employees including pilots, engineers and top management above the managers’ grade, dues have been pending since January 2019. As per a back-of-the-envelope calculation, salary dues to all employees are to the tune of more than ₹700 crore till the end of this month.


Lawyers who spoke to The Hindu said the employees were legally entitled to get their dues, but a court order would not yield anything until the airline finds a new buyer who would be bringing liquidity to pay for the liability and invest to revive operations.Lawyers said that the gratuity issue would come up for claim when the airline goes for liquidation after an NCLT process. “As long as the service of the employees is on, they are legally entitled to get their legal dues, including pending salary and gratuity, which will be carried forward to the new owner or in case of liquidation, it will be recovered from the sale of assets. The proceeds will be distributed pro rata between the employees and secured creditors,” a lawyer said.