Air India board likely to discuss VRS

New Delhi: The cash-strapped national carrier Air India is likely to discuss a fresh voluntary retirement scheme (VRS) on Tuesday. The company has approximately 36,000-40,000 employees, the highest in the industry in both absolute and per aircraft terms.
“This is one of the 32 items listed for board meeting. The Government is willing to provide one-time financial support to the proposal to shed flab. This financial support could be part of equity infusion,” a person familiar with the development told Business Line.
After the board's consent and approval from the Government, the company will formalise the details of the proposal and implement it.
The person declined to divulge the number of employees which the airline hopes to reduce through the VRS. But it is likely to offer VRS to staff other than pilot, engineer and cabin crew. At present, the company's annual wage bill is around Rs 3,600 crore. The Group of Ministers (GoM) has already asked the airline to implement VRS.
The debt-laden company has nearly 40,000 regular employees. However, if the company hives off two divisions, namely the ground handling and the maintenance, repair and overhaul (MRO) divisions into separate business units, then only half the employees will remain with the airline.
28/11/11 Shishir Sinha/Business Line

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Categories: Air India Nov 2011