India's state owned airline Air India has started the process of identifying employees who will be sent on compulsory leave without pay (LWP) for up to five years, an official directive has revealed.
According to an Air India official, the airline’s board of directors has authorised its Chairman and Managing Director (CMD) Rajiv Bansal to send employees on leave without pay.
“For six months or for a period of two years extendable up to five years, depending upon the following factors - suitability, efficiency, competence, quality of performance, health of the employee, instance of non availability of the employee for duty in the past as a result of ill health or otherwise and redundancy,” the airline's official order reportedly reads.
The order further mentions that the departmental heads in all offices (headquarters or regional) are required to assess each employee on the stated factors and identify cases where options of compulsory leave without pay can be exercised.
“Names of such employees need to be sent to the General Manager in headquarter by 15 August for obtaining necessary approval of the CMD,” it reads, adding that people seeking to voluntarily go on leave without pay will require the company’s approval on a case by case basis (subject to the requirements of the company).
The step has come at a time when the government is trying to sell off the airline, though this process has been delayed due to the COVID-19 outbreak. Almost all airlines in India have been working on cost cutting measures such as pay cuts and redundancies to preserve cash flow.
Recently, two pilot wings of Air India wrote to the airline’s Chairman and MD Bansal asking him not implement a 10% pay cut to category IV employees and suggested instead sending employees from every department on leave without pay in view of the few aircraft operating due to poor demand.
According to officials, there are around 13,000 permanent employees for a monthly bill of around INR 2.3 billion ($30.6 million approx). Over the last few months, the airline has been delaying payment of flying allowances to crew members due to the financial crunch, which has worsened due to the travel restrictions caused by the COVID-19 pandemic.
Airlines have been allowed to operate only a maximum of 45 percent of their pre COVID-19 domestic flights. Since operations were resumed, occupancy in domestic flights has been around 50-60 percent.