AI's wishy-washy restructuring process continues
04 March 2010
New Delhi: Struggling carrier Air India has now come out with a proposal that will attempt to slash total employee salary packages by 15-17 per cent. This watered down proposal, an outcome of the stiff opposition put up by the carrier's bloated staff pool, will now be offered to the Cabinet for its consideration. Last year the Cabinet had asked the carrier to come up with comprehensive restructuring proposals in order to qualify for further government doles.
The carrier has since been tottering from one botched effort to reorganise its salary payout and staff strength to another without achieving meaningful conclusion.
Air India is run by holding company The National Aviation Company of India Ltd (Nacil).
The total salary package, which Air India is now proposing to restructure, would include basic salary, dearness allowance, house rent allowance and payments made under the productivity-linked incentive scheme (PLI).
The cut, it is being clarified, would not be applicable on employees who have a gross salary of less than Rs20,000 a month. Union sources put the number of such employees at about 4,000.
An earlier attempt by the state-owned airline to push through a proposal for a 50 per cent reduction in PLI across the board had to be aborted in face of stiff opposition from its 32,000 employees. If successful, that plan would have enabled the carrier to save Rs600 crore.