Air India Rules Out Layoffs, But Continues Slashing Allowances Of Employees By Up To 50%

Following the backlash received by pilots, national carrier Air India on Thursday ruled out their earlier decision of laying off employees but said that the company will continue to slash allowances of staff members who have a monthly gross salary of more than ₹25,000 by up to 50%.

"Recent decisions of the Air India Board regarding rationalization of staff cost were reviewed in a meeting this evening. The meeting reiterated that unlike other carriers which have laid off a large number of their employees, no employee of Air India will be laid off," the airline said in a series of tweets.

The allowances had to be rationalized given the impact of the COVID-19 pandemic on the aviation sector, the company said on twitter.

The company has a debt of around ₹70,000 crore. For the same, the government has been trying to sell off the airline but haven't succeeded so far.

This comes days after Air India announced that it would continue to send few of the staff members on compulsory leave without pay (LOP) for up to five years.

The airline had asked its departmental heads and regional directors to identify employees, based on various factors like efficiency, health and redundancy, who will be sent on compulsory leave without pay for up to five years.

The recent decision further read that there has been no reduction in the Basic pay, DA and HRA of any category of employees.

Post the announcement by the company, the Air India Joint Action Forum of Unions on Twitter responded that the decision was nothing but the twisting of facts.

"It is not a 'lay-off' but it is a compulsory leave without pay, which is merely a lay-off without legally due payments," the Air India Joint Action Forum of Unions responded in a tweet.

The Union asked the pay cut to be fair across the board & an equal percentage for all categories of Gross earnings.

Further, the airline has decided to pay the staff members as per the number of hours flown. For general category officers, all other allowances would be reduced by 50%, and general category staff and operators would get all other allowances decreased by 30%, the internal order as stated by The Mint.

In addition, the cabin crew members would see their all other allowances like check allowance, flying allowance and quick return allowance reduced by 20%.

According to the media report, the airline's order stated 11 types of allowances including flying allowance, special pay, widebody allowance, domestic layover allowance and executive flying allowance.

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