Air India officials from being sacked immediately after privatisation, the government is likely to add a clause that will make it mandatory for the new owner to retain all national carrier’s staff for one year after the completion of the sale.
Reported that a clause in share purchase agreement would entail that a successful bidder take the employees of Air India and Air India Express on its payroll for a period of one year. “Employees cannot be asked to resign. While the private player will be given full independence in taking strategic decisions, employees will be asked to be retained for one year,” the BS quoted an official as saying.
But what will happen after one year? According to the report, Air India’s new owner will decide on a voluntary retirement scheme or VRS. However, the government will ensure that the terms of the VRS will be on a par with the employees’ service condition, the report said citing the official.
The retirement age at Air India is 58 and the average age of officials in state-run airline is 55. This is why the government feels that if the employees are offered reasonable package, they will accept it. Air India has five subsidiaries: Air India Express, Air India Air Transport Service, Air India SATS, Alliance Air and Air India Engineering Services. Air India with its subsidiaries has around 22,000 employees.
Earlier this year, a parliamentary panel had asked the government to make an assessment of the job loss before deciding on Air India sale. “If the disinvestment of Air India and its subsidiaries is inevitable, the Committee emphatically recommends that the interests of employees should be protected,” the panel said in its report.
The panel had also asked the Ministries of Finance and Civil Aviation to develop a strategic package to protect the rights and interests of officers and staff of Air India and its subsidiaries in respect of their pension, gratuity and VRS and also the wages of contractual workers engaged by government from time to time in case the disinvestment of Air India is inevitable.
Currently, a group of ministers is in the process of finalising the contours of strategic disinvestment of the state-owned airline. The government is expected to invite Expression of Interest or EoI in a couple of weeks.
All the details about the disinvestment, including net worth criteria for the bidders, will be part of the EoI document. The process of sale began last year after the Cabinet Committee on Economic Affairs gave in-principle approval for strategic disinvestment of Air India and its five subsidiaries.>