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Air India will try paring top managements’ salary
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#1
NEW DELHI: Air India is likely to cut salaries of top management in a bid to rein in costs despite a similar the aborted bid to pare the remuneration of pilots in late September . An immediate strike by the pilots had crippled the carrier for days together, forcing it to take back the decision.

The airline is likely to take a decision on a cut in performance-linked incentives (PLIs) of functional and executive directors in the board meeting scheduled for Wednesday, sources in Air India said on condition of anonymity.

The board meeting comes ahead of the crucial meeting of group of ministers (GoM) on Thursday to consider the lossmaking airline’s demand for equity infusion of Rs 5,000 crore. The GoM headed by finance minister Pranab Mukherjee, in its last meeting, had asked the national carrier to present a firm cost cutting and revenue enhancement plan.

As part of its cost-cutting exercise , Air India had earlier proposed to cut PLIs of its nearly 32,000 employees by up to 50%, but the plan could not be implemented in the face of severe resistance from pilots. Executive pilots protested the management’s move by going on strike for five days which cost the airline over Rs 100 crore due to cancellations.

“A mail has been sent by finance director to executive directors . The director has instructed the salary department to not disburse PLI of executive and functional directors on November 10,” a senior Air India official said.

The move to pare the PLI of these officials, which constitutes nearly 40% of the total salary, has caused resentment among the top executives. “We cannot agree to such decisions. There are hundreds of people whose salaries and perks have so far not been touched because they have bargaining power. We are already getting lower salaries compared to our counterparts in other public sector companies,” said an official wishing not to be identified.

Faced with an accumulated loss of Rs 7,200 crore as on march 2009, the national carrier is on cost-cutting drive which includes slashing employee’s salaries, rationalising capacity, cutting flights and doing away with all non-essential expenses.

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#2
The aviation industry seems to be far struck with recession as they continue to cut salaries. Sad
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