In a bid to stabilize its employee cost, Jet Airways said it will freeze salary increases.
“There is also an immediate need to stabilize our employee cost. In line with the same, it has been decided to freeze salary increases for this financial year. This salary freeze will be applicable to all employees in manager grades M3 and above and will be effective April 1, 2017. We understand that these measures are difficult and unsettling, but are unavoidable,” Jet Airways stated in its mail to employees.
Jet Airways's employee benefit expenses in the financial year ended March 31, 2016, was Rs 2,388.1 crore, up from FY 14-15 figure of Rs 2,243 crore.
"Our company continues to have a very competitive policy on compensation & benefits. We have been able to retain employees and provide them with substantial growth basis performance and opportunities within the company. At Jet Airways, increments have been periodic and annual, basis the criteria of performance, inflationary trends, standard of living and other relevant factors," Jet told its senior employees in the letter.
The letter further stated the given the competitive pressures and challenges in the airline industry, the need to drive a higher level of performance is immense. “We are now on the threshold of change and it is imperative to re-engineer our process and systems. Hence, it is essential to re-examine our standard remuneration policy and introduce a more dynamic reward mechanism which considers both, the company and individual performance parameters as the paramount criterion and factors in other market dynamics including overall wage cost and profitability. While we are undertaking several measures to overcome these impediments, there is also an immediate need to stabilize our employee cost," it added.