It is not a happy ending yet for the Kalrock-Jalan consortium and the insolvency resolution process of Jet Airways, as employees of the grounded airline are unhappy with the relief they are being offered.
The admitted claims of employees stood at Rs 1,265 crore, while the consortium has proposed Rs 52 crore to settle their claims.
According to employees, the airline owes at least Rs 3 lakh to each employee which may well go up to Rs 85 lakh.
However, as per the settlement proposal, each employee is being offered a total of around Rs 23,000, which one employee, who did not want to be named, described as "peanuts".
The plan proposes to pay each workman of the corporate debtor Rs 11,000 cash, Rs 5,100 cash as medical expense reimbursement for the parents of the workmen, Rs 5,100 cash as school fee reimbursement for children of the staff, Rs 1,100 would be paid for stationary for children of the staff and one-time mobile phone recharge of Rs 500.
This cash payment will be made out of the contingency fund (Rs 8 crores). Additional amounts, if required, will be utilised out of the proceeds of sale of assets received by the corporate debtor.
Now, there is uncertainty among the employees whether to vote in favour of the plan or vote against it and lose whatever relief that is being offered.
As per the resolution plan, the employees and workmen would get the relief only if 95 per cent of them vote in favour of the plan.
According to people in the know, it would be tough to garner the 95 per cent votes.
Employees are now in a dilemma whether to legally contest the resolution plan or go with the "little" relief that is being provided.
According to the resolution plan, the proposal for employees and workmen (equity stake in the Corporate Debtor; equity stake in AGSL, cash payment for employees and workmen, IT Assets and Free Tickets) is valid only if at least 95 per cent of the employees and workmen of the Corporate Debtor (as on ICD) support this Resolution Plan by not contesting or challenging its approval by the adjudicating authority (the authority) or its implementation in the manner approved by the authority.
"If the above proposal is not accepted by the employees and workmen within 30 days from the Approval Date, then no other creditor will have the right to seek such benefits or any part thereof and such proposal shall stand withdrawn. After expiry of the said period of 30 days from the Approval Date, the equity stake of 0.50 per cent, and cash payments of up to Rs 8 crores currently earmarked for employees and workmen will be given to the AFCs," the NCLT's order copy noted.
With the approval of the National Company Law Tribunal (NCLT) to the resolution plan of Kalrock-Jalan consortium, the Corporate Insolvency Resolution Process (CIRP) of Jet Airways has already concluded.
The seven-member monitoring committee has been constituted to look into the day-to-day operations and the implementation of the resolution plan.
The now-grounded Jet Airways is expected likely to take the skies again within six months from now.
On June 22, the Mumbai bench of the NCLT approved the resolution plan of the Kalrock-Jalan Consortium and gave a 90-day time period to the DGCA and the Civil Aviation Ministry to allot the slots.