CNBC-TV18 reported that Air India cut employee allowances up to 50% and extended cost reduction measures within less than a week. This also specifies that in a month the carrier must pay the pilots the flight bonuses in keeping with the real operating hours.
Beginning 1 April 2020, the new allocations shall be enforced. Since Air India revealed that it had placed several workers on leave without pay for five years, it agreed to reduce allowances. This is heavily paid by the carrier, which has been pounded off by the suspension of planes because of flight restrictions.
The aviation industry is one of the places where the national shutdown has had the biggest effects. With all aircraft grounded for two months, airlines have had trouble even paying workers’ maintenance costs and salaries. To order to reduce its operating costs, the company Indigo reported earlier this week that it would lose ten percent of its staff.
In a letter to the management of Air India, the All India Cabin Cruising Association claimed that AICCA is strongly protesting against this circular and that it fears that the mandatory leave scheme is a smokescreen to a backdoor retrieval/layoff scheme and is breaching numerous orders of the Supreme Court including the constitutional judgment of the Section 25 SC.
The CAPA India Aviation Consultancy company said that the decision of Indigo to lay 10 percent of its workers marks the start of a traumatic Indian aviation cycle, as the effect of the coronavirus is beginning unraveling. Despite a solid balance sheet, CAPA India had said that this recession cannot be sustained. The advisory company has warned the industry that one or more accidents of the airlines seem to be imminent.
Cost-saving decisions were taken regularly over the past week and the move today is the fourth in a row. In considerations such as suitability, productivity, integrity, service level, the safety of workers, and retirement are also being scrutinized by Air India to send workers on unpaid leave. Seeing that the airline sector still faces a heavy front wind, the authorization for restricted service will reduce the industry’s delay for a while.