Air India to cut employee costs by up to Rs 500 cr a year | india | Hindustan Times
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Air India to cut employee costs by up to Rs 500 cr a year

india Updated: Jun 22, 2009 14:35 IST

Air India is working on plans to reduce its expenditure on employees by Rs 500 crore per annum, with a newly formed Committee re-examining wage and other agreements in consultation with the Unions.

The cash-strapped airline's employee cost currently is over Rs 3,000 crore annually, a company spokesperson said, adding that the airline was now targetting a reduction in employee cost to the tune of Rs 500 crore per annum.

At present, the merged carrier has around 31,000 employees.

One of the six panels set up recently is the Cost Rationalisation Committee comprising officials of HR and Finance Departments.

The committee has been directed to discuss cost rationalisation and reduction of wasteful expenditure with employees' unions and submit its report by July 15.

The spokesperson said that the committee would examine the wage agreements, including those relating to flying allowances and productivity-linked incentives.

The five other committees that have been formed are the Committee on Integration, Committee on Green Initiatives, Committee on Safety, Committee on Customer Feedback and Route Rationalisation Committee.

The management has held at least two rounds of talks with various Air India employees unions in this regard, with the union leaders coming up with several suggestions to cut costs.