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Air India Chairman and Managing Director Raghu Menon said the airline was planning to offer a “leave-without-pay” scheme to some 15,000 eligible employees, reports Samiran Saha.

india Updated: Oct 17, 2008 00:52 IST
Samiran Saha

Air India Chairman and Managing Director Raghu Menon said the airline was planning to offer a “leave-without-pay” scheme to some 15,000 eligible employees.

The scheme, however, would be “purely voluntary in nature,” and would not be thrust upon any employee, an Air India statement said after Menon’s remarks at an air show in Hyderabad caused much consternation.

The airline is “proposing to introduce a scheme whereby employees can voluntarily decide to avail of leave for a period ranging from two to five years, subject to the discretion of the management,” the statement said.

“There is no compulsion on any employee to accept the scheme,” it said. “The staff continues to retain a lien on his job during this period.”

Air India’s total staff strength is around 34,000, of whom 15,000 would be eligible for the proposed scheme, officials at the National Aviation Company Ltd., which is how the merged entity of Air India and Indian Airlines is called.

“There will be no retrenchment at Air India,” Civil Aviation Minister Praful Patel told reporters on the sidelines of the air show.

There has been much anxiety over jobs with airlines as the industry has slipped into slump, hit by a sharp spike in jet fuel prices and declining air travel because of an economic slowdown.

Ticket sales have dropped nearly 20 per cent from a year ago and analysts say the trend is unlikely to reverse soon.

The country’s airlines posted a combined loss of Rs 4,000 crore — Nacil’s share in that was Rs 2300 crore — in 2007-08. The losses are projected to double to Rs 8,000 crore in the current financial year.

The government plans to infuse Rs 1,500 crore in fresh capital for Air India soon, besides providing a soft loan of Rs 1,000 crore. The national carrier needs around Rs 40,000 crore to buy 111 new aircraft.