Air India pays April, May salaries, fails to provide incentives

MUMBAI|NEW DELHI: Air India has finally paid the salaries for the month of April and May to its 30,000 employees on Tuesday but failed to provide productivity linked incentives to more than a third of its total workforce, signalling that cash-crunch may delay payments in the coming months.

The carrier has again borrowed from banks, including HDFC Bank, to tide over the crisis, according to sources. The airline had earlier taken 600 crore loan from Corporation Bank to pay wages for the month of January. Air India has an annual wage bill of about 3,000 crore. Discontent among employees will continue to persist as PLI accounts for 50-80% of total salaries.

"The issue of non-payment of salaries is now a common thing in Air India but at the same time the government also has to put in the money that is due to Air India. It is now becoming a survival issue," said George Abraham, leader, Air India Employees Guild.

Arvind Jadhav, chairman and managing director (CMD), sent an e-mail last week to the employees, promising payment of delayed salaries by June 28. Air India spokesperson did not respond to queries on the subject. Jadhav had also pointed out that the carrier was finding it difficult to continue operations in the wake of rising debt and cash crunch.

"Increasing debts, mushrooming interest burden, and increasing fuel costs are financially crippling the company. It is becoming difficult to sustain our operations without cash flows and revenue generation," he had said.

Simmering discontent among employees may lead to mass protest if salaries get delayed in the month of June. An umbrella organisation, which has representatives from all the unions of Air India, wore black bands from June 23, in a sign that employees are in a mood to fight against the management.