Air India Storm Is Brewing In The Horizon

Wednesday, 24th April 2013 at 10:51am

It seems as if its merger with Indian Airlines has been a bad spell for Air India. Since the merger between the two erstwhile rivals in 2006, troubles have been dogging the surviving Air India company.

Now, another trouble is in the offing. The constant delay in paying its employees their salary and the impending salary cut for all employees, seemed to have sent an alarm to pilots, who belong to the former Indian Airlines, to call for an emergency meeting early last week.

Air India has been beset by financial problems that even lead to huge losses since 2007 when it merged with another state-owned airline, Indian Airlines.

The pilots are asking for payment of their basic salary only for the most current month which ranges from Rs7,000 to Rs10,000. That amount is exclusive of the flying allowance that they are entitled to receive which comprises more than 80% of their total pay. A union member was quoted as saying that the morale of the staff has never been that low with the current situation they are facing. He told the media that they are already fed up with the perpetual financial problems of the company that affect greatly the payment of salary to the employees.

The union, Indian Commercial Pilots' Association (ICPA), has already concurred that they authorize their leaders to take appropriate action over the impending salary cuts as proposed by the Dharmadhikari committee report. A union member said that the cut for co-pilots will reach up to 26% and up to 48% for senior pilots.

The union has sent the AI management a copy of the current wage structures of a major Indian full-service airline and 3 the Gulf carriers as reference. A senior pilot was quoted as saying that if the AI management wants to pay according to market standards, they should refer to the wage structures that we give them.

A senior official added that the airline is already improving especially in the aspect of revenue generation.

An airline official also admitted recently confirming the improved financial performance of the airline. But he was quick to admit also that the airline is embarking on an expansion mode through the purchase of new aircraft. The aircraft purchase requires the airline to put equity too, and as a result, drains the airline some funds. The airline, he added, is also trying to comply its debt obligations to its creditors as well as salary payment to the employees.

By: Pete Lee.