The management of the airline had on April 6 sent a notification to its staff seeking their consent on its plans to 'slash the allowance by 15%.'
If the notification received no objections, the proposal would be implemented on April 27, 21 days after it was initially floated, according to a staff of the airline who received the letter.
So the pilots have 21 days to respond to the notification after receiving the letter.
At present, flying allowance comprise of about 70% of a pilot's salary, who are guaranteed a flying allowance for 72-80 hours. Air India has however proposed to reduce this to 70 hours.
Some of the pilots who are unhappy with the notification belong to the group which operate narrow-body aircraft like Airbus-320s on domestic and selected international
The total pay packet for a commander in this category ranges between Rs 4-5 lakh a month, while a co-pilot gets between Rs 2-3 lakh a month.
Executive commanders of wide-body aircraft, whose monthly pay packet could fall by close to Rs one lakh to around Rs 7.5 lakh, will also be affected by the proposed allowance cut. Senior wide-body pilots, who fly on international routes, get around Rs 6-7 lakh, while the co-pilots have a package of Rs 5-6 lakh. “The senior pilots will be the most affected lot,” said a pilot with the airline.
Pilots associations in the airline like Indian Pilot's Guild and Indian Commercial Pilots Association (ICPA) has lashed out against the new structure. Indian Pilot's guild was unrecognized by Air India management after 2012 strike by pilots.
“They have issued a note to the pilots on the recommendations of the Dharmadhikari Panel Report which includes appellation of lay over allowance and slashing their flying allowance from earlier guaranteed 72-80 hours to 70 hours,” said Jane Cox, advocate for Indian Pilots Guild.
The Bombay High Court had in January apart from ordering the status quo to be maintained on the implementation of the Dharmadhikari Committee Report also upheld the applicability of Section 9A of Industrial Dispute Act in this matter. According to Section 9A of Industrial Dispute Act, 'No employer, who proposes to effect any change in the conditions of service applicable to any workman in respect of any matter specified in the Fourth Schedule, shall effect such change without giving to the workmen likely to be affected by such change a notice in the prescribed manner of the nature of the change proposed to be effected.'
“Though the management is officialy saying that our allowances will be slashed by 15%, in reality, if the notification is implemented pilots could get as much as 40% lesser salaries,” said a senior pilot with the airline, under the condition of anonymity.
“We have raised our objections with the senior management, after meeting a senior official of the airline on April 8. He assured us that whatever decision is taken will be done with consultation with us,” the senior pilot said adding, “If the consultation process turn sour, hundreds of pilots could resign.” Air India's total staff bill for 2013-14 stood at around Rs 3,200 crore, of which over Rs 1000 crore is earmarked for pilots, a senior official of the airline had earlier told FE.
The proposed slash in the allowances across the board would help the airline to save over Rs 250 crore annually.
At present the state carrier has about 25,000 staff in its rank including about 1600 pilots.
Meanwhile, when contacted an Air India spokesperson said that the proposed cut in allowance, if implemented, will be applicable for all employees of the airline.
“The proposals by the management are in accordance to the market standard. Also, we are currently discussing this issue with the pilots and other employees,” he said, adding, “We will not take any decision without the consent of our employees.”
Air India expects to narrow its net loss to Rs.3900 crore for 2013-14, as compared to about Rs 5,100 crore in 2012-13. According to a senior Air India official, the airline currently has a total debt close to Rs.44, 000 crore, half of which is aircraft related. Out of the balance nearly Rs.18000 crore represent long term working capital loans.