SpiceJet’s financial stress appears to be spilling over into its workforce. The budget airline has started cutting manpower as it deals with a smaller fleet, rising dues and delays in salary payments, according to a report by Economic Times. The move signals a deeper crunch and a push to conserve cash.
A SpiceJet executive told ET that management had decided to reduce headcount, pointing out that the airline once operated 50 aircraft but now runs far fewer. The executive added that up to 20% of employees could eventually be impacted.
Furloughs, unpaid leave begin
In the first phase, more than 500 employees are likely to be affected through furloughs and leave without pay, the report said. The airline has around 6,800 employees but currently operates about 13 owned aircraft along with roughly 14 wet-leased planes that come with crew.
A March 31 letter from the human resources team informed staff about a six-month furlough from April 1 to September 30, 2026. The communication reportedly cited reduced operations and cost rationalisation as reasons.
Employees told the publication that unpaid leave is difficult to sustain financially. “Some have just got married, some have diabetes, some have ailing parents. But nobody’s plea is being heard,” an airline official said.
The disruption has also affected employees serving notice periods. Several engineers who had resigned were informed on March 31 that their notice period would be waived, making it their last working day, the report said.
Around 62 engineers are part of the initial list, out of a total engineering workforce of about 800. Many of them were expected to join airlines such as Air India and Akasa Air.
Salary delays, pay cuts add pressure
Salary delays have added to employee concerns. The report said that delays have stretched from about a month to as much as three months in some cases. As of early April, some higher-paid employees had not received their January salaries, while ground staff faced a two-month gap.
“The negotiating power of engineers is gone; others are even worse off,” an employee told the publication, describing the situation as “grim”.
Operational changes are also impacting pilots. A revised contract for Q400 pilots introduces a 21-days-on, nine-days-off roster. While SpiceJet says this improves work-life balance, pilots estimate a potential 20% drop in monthly income.
Concerns are also rising over pending statutory dues. Executives indicated that unpaid GST, provident fund contributions and TDS could exceed Rs 100 crore. Overall liabilities are estimated at more than Rs 4,500 crore, despite the airline raising over Rs 3,000 crore in September 2024, the report added.
This comes at a time when Indian airlines are set to operate about 10% fewer domestic flights in the summer 2026 schedule compared to last year, with a senior aviation official telling Moneycontrol that uncertainty and rising operating costs could lead to further reductions.