Air India may cut salaries by 5 per cent after Indigo, amid coronavirus concerns
Government-owned Air India may cut the salary of employees by 5 per cent amid its growing financial woes particularly in the wake of the coronavirus pandemic, which has nearly grounded its entire international operations, sources said. The reduction will be across the board, they say.
The loss-making airline, which is in the process of a second attempt of privatization after failing to get a single buyer nearly two years ago, has already taken some steps such as reduced flying allowances to cabin crew besides withdrawing entertainment allowance to executive pilots, among others.
“Air India is considering a 5 per cent pay cut to its employees as it faces huge financial crisis due to the ongoing coronavirus outbreak, which has brought almost its entire international operations save the US, Canada and a few other markets, to the ground," a source told PTI.
According to another source, privy to the development, the carrier has also decided to take off from flying its over 100 reemployed pilots on contract as part of various cost-cutting measures.
Air India spokesperson was not available for comments.
On Tuesday, the airline issued a circular stating that it is withdrawing entertainment allowance to executive pilots. It also said that all cabin crew including on contract rostered for flying duties from April 1 will have revised layover allowance of USD 100 for 30 hours and after that USD 4 for every additional hour.
In case of ultra long haul flights, it has been revised to USD 140 for 30 hours and after that USD 6 for every additional hour of flight. The fuel allowance is also being cut by 10 per cent for six months, effective April 1, it said.
The airline said such measures are being taken “keeping in view the financial position of the company in the wake of the recent global development.''
This situation requires cost-cutting measures to the extent possible, the airline said adding “Airlines world over are taking steps in this regard, with a few having taken very aggressive actions and the measures taken by it are in line with these steps.”
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