NEW DELHI, India - The nearly month-long crisis in Kingfisher Airlines ended on Thursday with the management lifting the lockout and agreeing to pay by December end four months' salary dues to striking employees who decided to return to work with immediate effect.
However, resumption of Kingfisher's flight operations may take at least 3-4 weeks as the airline would have to get the suspension of its flying license revoked by the DGCA which also has to satisfy itself on safety issues as well as the viability of their financial and operational plans.
After separate rounds of meetings with agitating pilots and engineers here, the airline management agreed to pay the March salary within 24 hours, the April salary by October 31, May dues before Diwali in mid-November and June salary by December end.
The striking employees had earlier stepped up the heat demanding an immediate settlement while threatening to take their protest to the the upcoming Formula One Grand Prix in which airline promoter Vijay Mallya is involved.
Soon after the agreement with the employees was arrived at, Mallya said in a tweet: "All Kingfisher Team members back at work and fully supportive. I sincerely thank all of them for their faith and continuing commitment."
Asked whether the 25-day lockout has been lifted, an airline spokesperson said, "yes, with immediate effect."
Later in a statement, he said Kingfisher "is pleased to announce that all of its employees have agreed to resume work and report for duty immediately. All employees are now eagerly looking forward to working together in order to re-starting operations very soon.
"We will now finalize and present our resumption plan to the DGCA and hope to get their concurrence soon."
Under the agreement, the management, which was earlier offering only three month salary dues, climbed down to accept the workers' demand for payment of four out of seven months' dues by December end.
The salary dues from July to September would be paid by March next year after recapitalisation of the airline, an engineers' representative said, adding that CEO Sanjay Aggarwal had also said that recapitalisation of the beleaguered carrier "will be done in 5-6 months."
All Kingfisher flights have remained suspended since September 30 due to the strike, followed by a lockout from October one and then suspension of their Scheduled Operator's Permit (SOP) or the flying license by aviation regulator DGCA. The license of Kingfisher was issued on August 26, 2003, and is valid till December 31 this year.
The carrier, which early last year had a fleet of 66 aircraft, now has ten -- seven Airbus A-320s and three ATR turbo-props. It is saddled with a loss of Rs 8,000 crore and a debt burden of another over Rs 7,524 crore, a large part of which has not been serviced for several months.
Earlier, Civil Aviation Minister Ajit Singh said while salary was "a big issue and the employees should be paid, the bigger issue than that is the airline's fiscal assurance to the DGCA... They have lot of outstandings to the Airports Authority (of India), to companies, to lessors, so its not just a question of salaries to the employees."
He said their flying license, though suspended, is "still there but to allow them to fly again, the DGCA has to be satisfied on many more things." The airline has to present a viable operational plan to the DGCA.
Noting that the airline had not yet submitted any revival plan to the DGCA, Singh said, "It is not a question of me being hopeful or not, in my view, it's a very difficult proposition but not impossible."