Air India to rejig productivity pay

New Delhi: The government’s plan to restructure Air India, the loss-making state-owned airline, includes a proposal to rework the troubled productivity-linked incentive (PLI) scheme, which accounts for over 45 per cent of the company’s Rs 3,000 crore wage bill.
The scheme has been at the core of the airline’s inflated costs, so much so that the airline set up a company last month to examine ways of reducing the wage bill by Rs 500 crore.
“At the moment, the PLI in many cases is huge, sometimes many times more than the salary and is not always related to performance. We need to restructure the PLI and save costs and make it directly related to performance,” said government sources involved in the restructuring of the airline.
For instance, technicians get a salary of around Rs 50,000 per month and a monthly PLI income of Rs 1.3 lakh. The PLI in this case is linked to criteria such as the number of aircraft services, among others.
At the lowest category of employees, the PLI constitutes 20 to 30 per cent of overall salary. For instance, a superintendent with a salary of around Rs 25,000 a month gets a monthly PLI of Rs 9,000 to 10,000.
At the lowest level of a helper, with a salary of Rs 15,000 a month, the PLI is around Rs 2,000.
The issue, however, is still to be discussed with Air India’s six-odd unions, some of which appear favourably inclined.
The management of Air India admits that restructuring PLI for the airline’s 31,000 employees won’t be easy.
The PLI is linked to productivity and not with profitability, so we have to see how the government is thinking of reworking them,” said a senior Air India executive.
18/07/09 Mihir Mishra & Surajeet Das Gupta/Business Standard

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Categories: NACIL Jul 2009