Flying empty wallet, pilots put Kingfisher on notice

Kingfisher Airlines may be headed for significant attrition among its pilots, who have not been paid salaries for the last two months.
Kingfisher Airlines CEO Sanjay Aggarwal met pilot representatives on Wednesday and assured them that their salaries for October, which should have been credited to their accounts by November 7, would be paid beginning later in the day, while the salaries for November would be released by December 15. But the pilots remain sceptical.

“We have stopped believing what the management says. No payments began on Wednesday despite the CEO’s assurance.  Not just us, ground staff and other employees who draw above Rs25,000 a month have also not been paid for two months. As of Thursday, more than 100 pilots have resigned and are serving their notice periods. Unless the situation on the ground changes drastically, they will complete their six-month notice and quit,” a senior pilot told DNA Money on the condition of anonymity.

He confirmed that at least 10 A 320 aircraft of Kingfisher are grounded currently, besides 12 ATRs and one A 330.

Another senior pilot, who has worked with the airline for five-and-a-half years, said they have been trying to form some sort of an association or a union to represent their demands to the management.
  
 “In the past, each time this issue came up, Vijay Mallya would deny us permission. Now, we are determined to form a group, which can take up our cause.”

Kingfisher spokespersons did not respond to either calls or e-mails on this matter.

Kingfisher’s woes began when it decided to first exit the low-cost space and subsequently cancelled a large number of flights to remain viable. Of the 418 scheduled departures per day in the winter schedule (which ends in March 2012), Kingfisher is currently operating only 243, as per a written reply by civil aviation minister Vayalar Ravi in the Lok Sabha on Wednesday.

The pilots also referred to non-submission of their income tax money as well as provident fund dues with the government for the last two years. “We have been getting income-tax notices for no fault of ours. The company has deducted these amounts and needs to pay them to the government.”

Kingfisher Airlines has seen dues to various stakeholders —- airport operators at Delhi and Mumbai, the Airports Authority of India and even the jet fuel suppliers —- mount over the last several weeks. The company has been negotiating with banks for an increase in loan limits even as it tries to get more equity into the airline.

The carrier reported a net loss of Rs468 crore for the quarter ended September even as revenues grew 10.2% to Rs1,528 crore. With operations crimped, revenue growth is bound to be affected adversely, making it even more difficult for the airline to meet its payment obligations.