Time to cut Air India wages, says GoM, passes the buck to Govt

New Delhi: The Group of Ministers on aviation today decided it was time Air India cut wages — the airline had been forced to roll back salary cuts of employees — and said the government was best placed to take this “politically sensitive” decision impacting about 31,000 employees.
The GoM, chaired by Finance Minister Pranab Mukherjee, asked Civil Aviation Minister Praful Patel to prepare a proposal on wage cuts or “harmonisation of wage agreements of 16 different unions”.
“This will be discussed by the Cabinet,” an official later told The Indian Express.
The GoM that met to review the National Aviation Company of India Ltd’s performance took stock of the Rs 900-crore savings the airline has managed this financial year till date. Nacil had targeted savings of Rs 2,000 crore but said this was possible only if wages were restructured and there was a single agreement for each employee category.
“At present, the per unit wage cost is high, resulting in low efficiency and productivity,” said the official. Apart from wage pacts, the proposal will also chart out a recovery plan addressing integration issues. “A financial restructuring strategy will be part of the proposal,” the official added.
In September 2009, Air India had to abort a plan to slash salaries of its executives by up to 50 per cent after executive-grade pilots struck work for five days.
04/02/10 Smita Aggarwal/Indian Express

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Categories: NACIL Feb 2010