Govt working on wage parity for IA, A-I merger

The government is in the process of structuring a uniform performance-linked incentive (PLI) scheme for Air-India (A-I) and Indian Airlines (IA) employees after the merger of the two airlines.

This means nearly 33,500 employees of the National Aviation Company of India Ltd (NACIL), which is the entity into which A-I and IA are being amalgamated, will get a common PLI scheme.

The government is also working out a formula to create uniformity in the wage component.

"This is aimed at reducing the disparity in the gross salary for NACIL employees. One cannot structure wages and PLI for only one part of the airline. The wages need to be streamlined to reflect uniformity for similar categories and avoid a conflict of interest," sources said.

The trigger for the move was a flash strike by a faction of Air-India's union.

Aviation Industry Employees' Guild's general secretary George Abraham said the union had called off the strike following an assurance from management to this effect. "The A-I management has assured us that the new PLI scheme would be implemented by next month," Abraham added.

However, the A-I management is yet to take a final decision as the new PLI scheme is only related with productivity parameters, but not profitability.

"This means the airline would end up paying a higher PLI even if the company is making losses. The realistic PLI scheme should also reflect the profitability of the company. The PLI scheme structured by experts take only parameters such as reliability, aircraft utilisation and other factors without considering profitability," a source said.

Airline sources said that the company was reviewing the PLI scheme and planning to restructure so as to factor in the profitability aspects too.

"A high-level committee within the company will be re-examining the PLI proposal and place before the board soon," they added.

At present, the structure of wages and PLI is different for Air-India and Indian Airlines depending upon categories and responsibilities.

The current PLI scheme of A-I was structured by the high powered committee of experts from Indian Institute of Managements (IIMs), National Institute of Industrial Engineering (NITIE) and National Productivity Council.

The Aviation Industry Employees' Guild, a union of Air-India with strength of over 8000, had resorted to flash strike on 14 August demanding the implementation of this above PLI scheme.