Air India workers unpaid in May, incentives delayed

Mumbai: National carrier Air India Ltd has not paid May salaries to its 33,000 employees and 7,000 casual workers. Productivity-linked incentives (PLIs), which constitute 50-70% of the salaries, have also not been paid for April.
The non-payment of salaries can hurt workers’ morale and undermine the state-owned airline’s chances of making operating profit by 2013 and net profit from 2015 with the help of a proposed financial restructuring plan, according to analysts. Air India’s accumulated losses stand at Rs.13,000 crore; it also has a debt of Rs.40,000 crore.
The Indian Commercial Pilots’ Association (Icpa), which went on a 10-day strike in early May, is bracing for another round of agitation against the airline management. With irregular and partial salary payments, many employees are finding it difficult to meet their monthly commitments for mortgages and car loans.
The last time airline employees got a hike in their salary was in 2007. With inflation staying over 9% for the past 15 months, their real income has been eroded substantially.
“You are well aware that Air India is passing through a very challenging and critical phase,” chairman and managing director Arvind Jadhav wrote to the airline’s employees on Thursday. “Increasing debts, mushrooming interest burden, and increasing fuel costs are financially crippling the company. It is becoming difficult to sustain our operations without cash flows and revenue generation.”
Jadhav has said the airline’s difficult financial situation has led to banks, financial institutions, vendors and suppliers asking for higher costs to cover credit risk.
20/06/11 PR Sanjai/Live Mint

To Read the News in full at Source, Click the Headline

Categories: Air India Jun 2011