SpiceJet Layoffs: Airline Cuts 500 Staff, Waives Notice Periods for Engineers as Active Fleet Drops to 13 Aircraft

Budget carrier SpiceJet has commenced a series of workforce rationalisation measures, including furloughs and immediate departures, as it faces a critical cash crunch and a dwindling operational fleet. Reports indicate that over 500 employees are expected to be affected in the initial phase of this restructuring. The airline, which once operated approximately 50 aircraft, has seen its active fleet shrink to just 13 of its own planes, forcing the management to align its manpower with its current reduced capacity.

The crisis is highlighted by a directive from the human resources department placed on March 31, informing staff of a six-month furlough period effective from April 1 to September 30, 2026. While the airline describes these moves as "cost-rationalisation," the lack of pay during this period has left many employees in a precarious financial position, particularly as the airline also struggles with mounting statutory dues and prolonged salary delays. Amazon Layoffs: Is Amazon Cutting 14,000 Jobs in May 2026? Company Calls Reports ‘False and Not Based in Fact’.

Furloughs and Engineering Departures

The immediate impact of the restructuring has been felt most acutely in the engineering department. In an unexpected move, dozens of engineers serving their notice periods were informed on March 31 that their notice had been waived, effectively ending their employment immediately. Approximately 62 engineers were part of this initial list, leaving many without income during the gap before joining new employers like Air India or Akasa Air.

For those remaining, the situation remains difficult. SpiceJet currently employs roughly 6,800 people, but with a significant portion of its remaining operations relying on 14 wet-leased aircraft—which come with their own external crews—the demand for internal staff has plummeted. Employees have expressed frustration, noting that pleas regarding personal financial commitments and health issues are largely being unheard by the management.

Salary Delays and Impact on Pilot Earnings

Internal morale has been further eroded by significant delays in salary disbursements. Reports suggest that payment cycles have slipped by as much as three months in some departments. As of early April, several high-salaried employees had reportedly not received their January wages, while ground staff and loaders are facing a two-month payment gap.

Operational changes are also affecting the flight deck. A revised contract for Q400 pilots introduces a new "21-days-on, nine-days-off" schedule. While the airline management maintains this is intended to improve work-life balance, pilots estimate the new structure could result in a 20% reduction in their monthly earnings.

Financial Liabilities and Statutory Dues

Despite raising over INR 3,000 crore in September 2024, SpiceJet's total liabilities are estimated to exceed INR 4,500 crore. There are mounting concerns over pending statutory obligations, including unpaid Goods and Services Tax (GST), provident fund contributions, and Tax Deducted at Source (TDS), which executives suggest could collectively surpass INR 100 crore. Tech Layoffs 2026: Over 71,000 Jobs Cut as Giants Like Oracle, Amazon and Dell Pivot to AI-Driven Operations.

The airline's search for survival capital continues as it attempts to navigate these legal and financial hurdles. Industry analysts suggest that without a significant infusion of funds or a rapid expansion of its active fleet, the carrier may face further downsizing to remain operational in a highly competitive Indian aviation market.

(The above story first appeared on LatestLY on Apr 10, 2026 02:56 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).