State-owned airline Air India has started on a cost cutting drive and will send around 600 employees on furlough. This is the first time the public sector company has taken such a decision.

The Air India board on 7 July has approved the scheme of Leave Without Pay (LWP) for employees for a period ranging from six months to five years. While initially it is voluntary in nature, the board has also authorised Chairman and Managing Director Rajiv Bansal to forcibly send employees on leave.

According to a notice sent to employees by the airline’s human resources department, employees will be judged based on “suitability, efficiency, competence, quality of performance, health and redundancy.”

“During the period of leave without pay, employees will not be paid any basic, dearness allowance or other benefits like pension, gratuity, provident fund, increment. They shall also lose their seniority with reference to juniors,” the notice said.

Employees staying at staff quarters will also have to vacate the same or rent it back from the airline at prevailing market price.

The move has unsettled the employees especially pilots and cabin crews who feel they will be in firing line. “ The burden should be shared by all departments across the board. If cherry picking is allowed, then top management will safeguard themselves while burdening others. Management shouldn’t be selfish for a common cause,” said Praveen Keethi, general secretary of Indian Commercial pilots’ Association, the airline pilot’s union.

The airline which has been identified by Government of India for privatising has accumulated a debt of Rs 69,575.64 crore. It posted a loss of Rs 8,556.35 crore in FY19, against a net loss of Rs 5,348.18 crore in the previous fiscal.

“With aircraft including wide body fleet grounded, there is a fixed cost of around Rs 700 crore every month. It’s impossible to recoup that with the current condition of the market,” the executive said.

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