Air India pilot unions fume at 'disproportionate' Covid pay cut, ask members to avoid airline bid

The Air India unions pointed out that while other major airlines have revised the pay cut for their employees, the national carrier is yet to resolve the issue

Air India pilot unions fume at 'disproportionate' Covid pay cut, ask members to avoid airline bid
The Air India employees have decided to bid for the airline. Image courtesy:

Two prominent Air India unions have directed the pilots of the national carrier not to take part in the employee bids for the strategic sale of the airline. The unions cited the "disproportionate" pay cut for the pilots as compared to that of the top management officials in the wake of the Covid-19 pandemic as the reason for this directive.

"All pilots are advised NOT TO acknowledge or participate in the process initiated by the management official till the disproportionate 70% pay cut for pilots vis-a-vis Air India's top management officials (10%) is addressed," read the letter by the Indian Commercial Pilots Association (ICPA), which represents the pilots flying Air India's narrow-body aircraft, and the Indian Pilots Guild (IPG), which represents those who operate wide-body aircraft of the national carrier.

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"Also, there is no clarity on the payment of the illegally withheld 25% arrears due to the pilots to date whilst we approach the deadline of December 14th for submission of bids for Air India," the letter said. 

Plane Vanilla had reported on December 3 that the Air India employees had decided to bid for the struggling national carrier with the help of a private equity fund. According to a highly-placed source with knowledge about the matter, over 200 employees are involved in the bidding process and the plan is that at least 51% stake would rest with the Air India employees if they succeed in their bid. 

The airline first announced a 10% cut in allowances for all employees except cabin crew for three months with effect from March 2020 to battle the Covid-19 downturn. It also withdrew the special allowance for pilots and revised downward the layover allowance for the cabin crew. Significantly, flying allowances of Air India pilots constitute 70% of their salaries. Thus the pilots who are at the frontline of the Covid-19 battle are forced to bear the greatest hardships, while the austerity measures would hardly affect the top management as their allowances are relatively quite small.

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According to a report in June, the debt-ridden airline also planned to reduce the guaranteed 70 hours flying allowance for the pilots to 30-35 hours as a cost-cutting measure in view of the pandemic.

Then in July, it cut the monthly allowances of its employees who drew a gross salary of over Rs 25,000 per month by up to 50%.

According to media reports in July, the pilots alleged that they had to bear a 60% pay cut, including a heavy cut on allowances, while the salaries of the top management were reduced by a mere 3.5-4%. The pilots of the airline had alleged that they had not been paid 70% of their salaries since April.

The airline also approved leave without pay (LWP) scheme of six months or two years extendable up to five years for its employees, subject to suitability, efficiency, competence, standard of work, redundancy and health of the employees, and also based on the service history of the employees of non-availability for duty due to ill health or otherwise.  

The Air India unions pointed out in the letter to the pilots that while other major airlines have revised the pay cut for their employees, the national carrier is yet to resolve the issue, even after being a public sector undertaking (PSU).   

The Air India unions had earlier cited the government's instructions on employee welfare and timely payment of wages without deductions. They gave the example of IndiGo in this regard. 

The unions asked the pilots to refrain from taking part in the employee bids till "further communication" from them.

The highly-placed source whom Plane Vanilla spoke to, however, downplayed the letter. "My understanding is that there are pilots who are also involved in the bid presently, so maybe these are those pilots who have not decided to participate. I am not aware of this fact, but in any event, I know that there are pilots who are part of this bid. So I don't know whether this statement can be taken at face value," he said. No such letter had been circulated to anybody who is part of the consortium, he added.

The government is looking to offload its entire stake in the debt-ridden carrier, including Air India’s 100% shareholding in Air India Express and 50% in Air India SATS Airport Services. 

The airline was put on the block on January 27 and the initial deadline for submission of bids was March 31. It was first extended to June 30 and then to August 31. It was again extended to October 30 in view of the situation arising out of the Covid-19 pandemic. Now, the new deadline has been set as December 14.