Asia Bizz: The employees of ailing airline company Kingfisher Airlines threatened to strike if their salaries are not given by 8 pm on April 3, 2012. The airline chief Vijay Mallya had earlier assured that he would start paying salaries from April 4, 2012. The employees have not been paid their salaries for more than 3 months.
The employees, including pilots, also appealed to Mallya that they were not in a condition to undertake their duties and that they could jeopardize the safety of their aircrafts. It was further said that the Kingfisher Airlines employees have come to a point where the operations have become unsafe due to stress caused by their financial constraints.
On April 1, 2012, the airline chief wrote a letter to the Kingfisher staff saying that the company’s accounts were frozen after it paid Rs. 44 crores to the Income Tax Department and Rs. 20 crores as service tax.
The letter added that it could not pay the salaries to the junior staff by April 4 and the pilots and engineers by April 10. The employees of the airlines have not been paid their salaries since December 2011. Mallya had assured that his only focus is to pay the overdue salaries.
On April 2, 2012 at least five Kingfisher Airline flights out of Mumbai and Delhi were cancelled as some of the staff did not report for duty and had demanded immediate payment of salary and allowance backlogs.
In the month of February, the tax authorities had frozen the bank accounts of the company, due to which it could not give the salaries to the employees. This in turn resulted in grounding of several flights. At present, Kingfisher owes $1.3 billion to banks which includes State Bank Of India and ICICI Bank. ICICI Bank recently asked the company to either top up its loan security or adjust the loan amount after the airline’s stock was pounded in recent times.