Jet employees move NCLAT over compensation

MUMBAI: Jet Airways staffers have moved the National Company Law Appellate Tribunal (NCLAT) challenging certain aspects of the Kalrock-Jalan consortium’s resolution plan that was approved by the National Company Law Tribunal (NCLT) on June 22. The staffers also did not approve the compensation offered by the consortium with little over 3,000 (35%) of the nearly 9,000 employees voting in favour and 5,500 (61%) abstaining from voting.


The Bharatiya Kamgar Sena (BKS) and Jet Airways Cabin Crew Association (JACCA) filed an appeal before the NCLAT on Wednesday against the consortium, the former resolution professional, Jet’s committee of creditors and monitoring committee. Arvind Sawant of BKS said: “We have two worries, one is the Jet staff’s pending dues and the second is about their jobs, their reinstatement.” Last month, TOI had reported that the Jet staffers had planned to file an appeal.


Of the 4,000-odd staffers who remained with Jet for over two years after it suspended operations in April 2019, only 50 have been retained in Jet 2.0. The remaining staffers have been hived off to a yet-to-be formed ground handling company, according to the consortium’s resolution plan.

To gain support for its resolution plan, the consortium had floated a proposal for Jet staff under which they were to get equity stake and management control of the said ground handling company. Among the other benefits, the proposal included a cash payment of Rs 22,800 to each staff, which included Rs 11,800 as reimbursement towards their parent’s medical expenses, their children’s school fees, stationery purchase and mobile recharge. But the consortium’s condition was that the proposal would be valid only if at least 95% of Jet staff voted in support of the resolution plan and not challenge its approval. Since only 35% voted in favour, the proposal has lapsed, said the consortium, in a communication on voting results, sent on Thursday.

Advocate Rahul Oak, representing BKS and JACCA in NCLAT said: “Our appeal is not against the revival of Jet, it’s about violation of major provisions of the labour laws. The workers have been moved to a company that currently has no operations and which could be liquidated at the discretion of the new owners.”

The benefits listed in the now-defunct proposal was over the above payments mentioned in the resolution plan. The NCLT order had mentioned Rs 52 crore as payment towards staffers’ dues. Apart from this, whatever would be left of the liquidation value owed to the staff will be paid to them on a priority basis, the order had said. Last month, the consortium had said that the liquidation value—the estimated realizable value of Jet Airways 1.0 assets on the insolvency commencement date—owed to the workers and employees is about Rs 100 crore. That is about 8% of the Rs 1,254 crore accepted claims Jet owes to its staffers towards payment of provident fund, gratuity, leave encashment and about six months’ salary.