National carrier Air India on Wednesday cut monthly allowances of its employees who earn a monthly gross salary of over Rs 25,000 by up to 50%, reported PTI, citing an internal order of the airline.
The order said that the employees’ basic salary and the allowances associated with it, such as house rent and industrial dearness benefits will stay the same. The “general category officers”, however, will suffer a 50% reduction in all the other allowances. “General category staff and ‘operators’ would get all other allowances decreased by 30 per cent,” the order read.
The cabin crew will get a 20% reduction in their allowances, including check, flying and quick return. The order added that 11 kinds of allowances for pilots would be reduced by 40%, and the flying allowance will be paid on the actual hours flown by an employee in a month.
“However, as a special case, all pilots available for flying will be paid fixed 20 hours of flying allowance or actuals, whichever is higher in a month, during Quarter 1 and Quarter 2 of 2020-’21 on revised flying allowance rate,” the airline’s order said. “For employees (both permanent and fixed-term contract) with gross salary up to Rs 25,000 there will be no reduction in salary.”
All fixed term contractual employees and staff members, apart from pilots, and cabin crew, will get a 50% and 30% reduction in their allowances, the national carrier said. The order will be effective from April 1 this year and will be implemented till the airline’s board members conduct a review.
An Indian Commercial Pilots Association spokesperson told Mumbai Mirror that the allowances contribute to 80% of the salaries of pilots and they had not been paid since April.
Earlier this month, the Air India pilot association had written to the national carrier complaining that the company’s leave without pay scheme was finalised without consulting the pilots. Last week, Air India began to send some under-performing employees on compulsory leave without pay for up to a period of five years. It claimed the policy was a “win-win situation” for both parties, as it gives freedom to its employees to engage themselves with another employer for the said period, while also allowing the airline to save its cash flow.
However, the Indian Commercial Pilot Association, which is the representative body of Air India’s pilots, said that any such “unilateral change” by the national carrier from the agreed-upon wage settlement would be illegal and will not be in its interest at “this crucial juncture”. “Such a situation has the potential to flare to an unprecedented magnitude,” the union said.
Air India has more than 13,000 permanent employees, giving it a monthly wage bill of over Rs 230 crore. The airline, which was going through a financial crisis, has been further hit due to coronavirus-induced restrictions. The Indian government banned all flights, domestic and international, in the end of March. Only some domestic flights were restarted on May 25.