Budget carrier SpiceJet has begun workforce reductions as it grapples with a shrinking fleet, mounting dues and prolonged salary delays, signalling a deepening financial crisis and an urgent search for survival capital claim media reports.
“The management has decided that it is time for manpower cuts. There was a time when we had 50 planes, but now we don't,” an airline executive told Economic Times on condition of anonymity, adding that around 20% of staff could eventually be impacted.
The immediate measures are expected to include furloughs and leave without pay (LWP), with more than 500 employees likely to be affected in the first phase, the report added. The airline currently employs around 6,800 staff but operates only about 13 of its own aircraft alongside roughly 14 wet-leased aircraft that come with their own crew.
According to the report by Economic Times, in a letter dated March 31, the airline's human resources department informed employees of a six-month furlough period from April 1 to Sept. 30, 2026, citing “reduced operational capacity” and the need for “cost-rationalisation and workforce-alignment measures”.
While not technically layoffs, employees told Ecnomic Times unpaid leave is financially untenable. “Some have just got married, some have diabetes, some have ailing parents. But nobody's plea is being heard,” a second airline official told the media house.
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The disruption extends beyond current employees. In an unprecedented move, dozens of engineers who had resigned and were serving their notice period were told on March 31 that their notice period had been waived, effectively making it their last working day. According to the report this has left many without pay before joining new employers such as Air India and Akasa Air.
Around 62 engineers are believed to be part of the initial list, with more expected, added Economic Times. The engineering workforce totals roughly 800, raising concerns of further exits. While rival airlines may benefit from this talent pool, senior engineers are reportedly facing pay cuts, even as younger recruits see modest increases.
Salary delays have further eroded morale, the report added. Executives say payments have slipped from one-month delays to as much as three months in some cases. As of early April, several higher-paid employees had not received January salaries, while ground staff and loaders face a two-month gap.
“The negotiating power of engineers is gone; others are even worse off,” an employee told Economic Times, describing the situation as “grim”.
The report added that operational changes are also impacting pilots. A revised contract for Q400 pilots introduces a 21-days-on, nine-days-off schedule, which management says is aimed at improving work-life balance. However, pilots estimate this could reduce monthly earnings by around 20%.
Meanwhile, concerns are mounting over statutory dues. Executives indicate pending obligations could exceed Rs 100 crore, including unpaid GST, provident fund contributions and TDS. Overall liabilities are estimated at more than Rs 4,500 crore, despite the airline raising over Rs 3,000 crore in September 2024.
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