Air India is sending employees on a 5-year leave without pay to cut down costs

• Air India has approved a leave without pay (LWP) scheme for employees. The LWP will start at six months and can be extendable up to five years.
• The scheme authorises chairman Rajiv Bansal to issue a leave without pay letter to employees on behalf and in the name of the company.
• The letter said regional directors will constitute a committee that would recommend a list of employees for compulsory LWP by August 15 after “obtaining necessary approval of CMD.”

Debt-ridden airline Air India has approved a leave without pay (LWP) scheme for employees ranging from six months or two years and extendable up to five years.

According to the circular dated July 14, the scheme authorises chairman Rajiv Bansal to issue a leave without pay letter to employees on behalf and in the name of the company. The decision will be based on employee suitability, efficiency, competence and health.

“Accordingly, departmental heads at headquarters and regional directors of the region are required to assess each individual on the above mentioned factors and identify the cases where option of compulsory LWP can be exercised. Names (to be approved by) CMD,” the letter reads.

Earlier in March, Air India announced a 10% pay cut for all its employees.

The letter said regional directors will constitute a committee comprised of General Manager (Personnel), General Manager (Finance) and concerned Departmental Head and would recommend a list of employees for compulsory LWP by August 15 after “obtaining necessary approval of CMD.”

However, the employees who do opt for the scheme will not be allowed to take up jobs anywhere else.

“Employees taking up employment after availing LWP under the scheme or at a later date, in other airlines and allied services or in any organisation with which the company has dealing, should seek prior permission from the company, before taking up employment in such an organisation. The services of an employee will be terminated in accordance with service regulations/standing orders/ applicable rules if the employee concerned fails to make such prior declaration/ seek permission,” according to the order.

Even during the LWP. benefits like medical/passage benefits will continue to be made available for employees.

This came after the Air India pilot association told chairman Rajiv Bansal in a letter earlier that the national carrier should take cues from private airlines in cost-cutting measures during the coronavirus pandemic.

The Indian Commercial Pilots’ Association( ICPA) and Indian Pilots’ Guild (IPG) listed various steps that Air India should take at this time when the aviation sector and the company itself is facing a major cash crunch due to the economic slowdown.

“Air India should also be guided by how other players in the aviation sector are battling the adversities of the coronavirus pandemic. We understand that a leading private carrier has an employee strength of 250 in finance and 130 in HR, handling a fleet of 255 aircrafts. This may be contrasted with Air India, which has more than 1600 employees in HR and Finance for a mere 125 aircrafts,” the letter from ICPA and IPG said.

Air India has over 13,000 employees with a monthly wage bill of around ₹230 crore. The carrier has also been delaying payments to pilots and its crew members, due to serious financial difficulties brought by the coronavirus induced travel ban.

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