Jet Airways’ new owner, the Jalan-Kalrock consortium, must settle unpaid gratuities and liabilities of the company’s employees as the company prepares to resume operations, the National Company Law Appellate Tribunal (NCLAT) has ordered. The former problem solving specialist was instructed to calculate the payments to be made to workers and employees within one month and communicate the results to the Jalan-Kalrock Consortium so that it could take the necessary steps to make the payments.
A two-judge panel of the Bankruptcy Appeals Court ordered the new owner to pay contributions to the provident fund, the resolution specialist conceded, after upholding a series of motions filed by labor unions, aircraft maintenance engineers, officers and staff unions, and others.
According to NCLAT, the amount of any gratuity provided under the resolution plan will be deducted from the workers’ entitlement to payment of their unpaid gratuity as at the date of commencement of insolvency.
“The successful resolution applicant is ordered to pay the unpaid workers’ pension fund after deducting the amount already paid into the workers’ pension fund in the workers’ resolution plan by the insolvency commencement date,” it said.
Through the insolvency resolution process, Jalan-Kalrock managed to win a bid for Jet Airways, which ceased operations in early 2019 due to the financial crisis. The airline is currently preparing to resume operations. A representative of the Jalan-Kalrock consortium declined to comment on the NCLAT decision.
The lead counsel for the Jet Airways Aggrieved Workers Association said the calculation must be completed by June 20, 2019, when the insolvency was declared. All workers and employees who quit or retired must receive their full gratuity and pension fund payments, according to the ordinance.