NCLAT orders new owners to clear gratuity and PF dues of Jet Airways employees before carrier flies again

The decision came in response to an appeal filed by the employees’ association, asking for unpaid wages and other dues including privileged leave encashment.

FPJ Web DeskUpdated: Saturday, October 22, 2022, 08:33 PM IST
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After reeling from debt and being grounded, Jet Airways’ return to Indian skies was once again delayed reportedly because of reluctance by its new lenders to clear orders for new aircraft. Although the airline owes each employee Rs 3 lakh to 85 lakh, the revival plan submitted by the Karlrock-Jalan consortium had proposed Rs 23,000 for every staff member last year. Now the National Company Law Appellate Tribunal has ordered the new owners, to clear provident fund and gratuity dues, that the carrier owes its employees.

Waiting for years to receive dues

The decision by the NCLAT follows a petition by an association of workmen, maintenance engineers, officers and staff, for complete payment of gratuity, unpaid wages and privileged leave encashment as well as bonus from April 2018 to June 2019. The former resolution professional in the case has been asked to calculate the amount and inform the Jalan-Karlrock consortium about how much they must pay.

But those employees who were demerged into a subsidiary called Airjet Ground Services, won’t be entitled to the gratuity, as it could not be termed as termination. But the NCLAT also denied demands of the workmen apart from gratuity and PF.

Lenders also find support

Apart from the employees, lenders have also found relief in the Jet Airways insolvency case, ahead of the airline’s resumption of operations. The embattled Punjab National Bank, which had itself been hit by bad loans as part of scam, will be receiving Rs 956 crore instead of Rs 754 crore as part of the resolution. The bank had approached the NCLAT after the resolution professional had reduced its claim ammount by Rs 202 crore.

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