Deloitte tells AI to freeze pay, promotion for 3 yrs

To turn around ailing Air India, financial advisory firm Deloitte has suggested a series of measures, including a freeze on any increase in pay or promotion of its 31,000 employees for the next three years. The airline has an annual wage bill of Rs 3,100 crore and the report has said as many as 2,600 employees will retire during the period of freeze.
It has also recommended the company cut spending on aviation turbine fuel by Rs 300 crore yearly, by negotiating more aggresively with suppliers for domestic routes.
In the next board meeting, on January 19, the board of directors is likely to discuss some of the Deloitte suggestions. The company was hired to vet the airline's financial plans.
The government carrier had earlier said a way to cut fuel costs would be to take ATF suppliers from the private sector, which offer better volume discounts. Currently, most of AI's fuel is taken from the state-owned oil corporations in India. Its annual fuel bill is Rs 4,000 crore.
07/01/11 Mihir Mishra/Business Standard/Sify

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Categories: Air India Jan 2011