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A Case on Air India’s Pilot Strike of May 2012

CONTENTS

1) Company background of Air India

2) History

3) The merger into Air India

4) Financial Crisis of Air India

5) The chronology of the Air India strike may 2012

6) Highlights of the strike: Management’s view and the Union’s view

7) Causes for the strike

8) Effects of the strike

9) Interview of former executive director of Air India: Jitender Bhargava

10) Conclusion: My understandings from the case

11) References

Submitted By:

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Batch (2)

Company Background

Air India is the flag carrier airline of India. It is part of the government of India owned Air

India Limited (AIL). The airline operates a fleet of Airbus and Boeing aircraft serving Asia,

Europe and North America. Its corporate office is located at the Air India Building at

Nariman Point in South Mumbai. Air India has two major domestic hubs at Indira Gandhi

International Airport and Chhatrapati Shivaji International Airport. An international hub at

Dubai International Airport is currently being planned.

Air India has the fourth largest share in India's domestic air travel market, behind Jet

Airways, IndiGo and SpiceJet, as of May 2012.Following its merger with Indian Airlines, Air

India has faced multiple problems, including escalating financial losses, discontent amongst

employees, and poor customer service. Between September 2007 and May 2011, Air India's

domestic market share declined from 19.2% to 14%, primarily due to stiff competition from

private Indian carriers. In August 2011, Air India's invitation to join Star Alliance was

suspended due to its failure to meet the minimum standards for the membership. In October

2011, talks between the airline and Star Alliance have resumed. In April 2012, the Indian

government granted another bailout package to Air India, including Rs300 billion ($5.8

billion) of subsidies.

Early years

Tata Sons, a division of Tata Sons Ltd. (now Tata Group) was founded by J. R. D. Tata in

1932. Tata Airlines initially consisted of one Puss Moth aircraft, one Leopard Moth, one

palm-thatched shed, one whole time pilot assisted by Tata and Vintcent, one part-time

engineer and two apprentice-mechanics.

Initial service included weekly airmail service with a Puss Moth aircraft between Karachi and

Madras via Ahmedabad and Bombay, covering over 1,300 miles. In its very first year of

operation, Tata Airlines flew 160,000 miles, carrying 155 passengers and 10.71 ton of mail.

In the next few years, Tata Airlines continued to rely for its revenue on the mail contract with

the Government of India for carriage of surcharged mail, including a considerable quantity of

overseas mail brought to Karachi by Imperial Airways. The same year, Tata Airlines

launched its longest domestic flight - Bombay to Trivandrum with a six-seater Miles Merlin.

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In 1938 it was re-christened as Tata Air Services and later same year was renamed as Tata

Airlines. By this time Delhi and Colombo were also serviced.

Post-war expansion

Following the end of World War II, regular commercial service was restored in India and

Tata Airlines became a public limited company on 29 July 1946 under the name Air India. In

1948, after the independence of India, 49% of the airline was acquired by the Government of

India, with an option to purchase an additional 2%. In return, the airline was granted status to

operate international services from India as the designated flag carrier under the name Air

India International. On 8 June 1948, a Lockheed Constellation L-749A named Malabar

Princess (registered VT-CQP) took off from Bombay bound for London Heathrow via Cairo

and Geneva. This marked the airline's first long-haul international flight, soon followed by

service in 1950 to Nairobi via Aden.

On 25 August 1953, the Government of India exercised its option to purchase a majority

stake in the carrier and Air India International Limited was born as one of the fruits of the Air

Corporations Act that nationalised the air transportation industry. At the same time all

domestic services were transferred to Indian Airlines (now renamed as Indian). In 1954, the

airline took delivery of its first L-1049 Super Constellations and inaugurated services to

Bangkok, Hong Kong, Tokyo and Singapore.

Early 1990s

In 1993, Air India took delivery of the flagship of its fleet when the first Boeing 747-400

named Konark (registered VT-ESM) made history by operating the first non-stop flight

between New York City and Delhi. In 1994 the airline was registered as Air India Ltd. In

1996, the airline inaugurated service to its second US gateway at O'Hare International Airport

in Chicago. In 1999, the airline opened its dedicated Terminal 2-C at the renamed Chhatrapati

Shivaji International Airport in Mumbai.

2000 – present

In 2000, Air India introduced services to Shanghai and to its third US gateway at Newark

Liberty International Airport in Newark. In May 2004, Air India launched a wholly owned

low cost airline called Air-India Express. Air India Express connecting cities in India with the

Middle East, Southeast Asia and the Subcontinent. In 2004 Air India launched flights to its

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fourth US gateway at Los Angeles International Airport in Los Angeles (which has since

been terminated) and expanded its international routes to include flights from Ahmedabad,

Amritsar, Bangalore and Hyderabad.

On 1 December 2009, Air India introduced services to its fifth US gateway at Washington

Dulles International Airport in Washington, D.C., accessed via a stopover at JFK Airport in

New York City. This service has been terminated.

Re-privatisation plans

In 2001, the Government of India put forward plans on privatizing Air India. One of the bids

was by a consortium of Tata Group-Singapore Airlines. However the re-privatisation plans

were shelved after Singapore Airlines pulled out and the global economy slumped.

Merger with Indian Airlines

In 2007, the Government of India announced that Air India would be merged with Indian

Airlines. As part of the merger process, a new company called the National Aviation

Company of India Limited (NACIL) was established, into which both Air India (along with

Air India Express) and Indian Airlines (along with Alliance Air) will be merged.

On 27 February 2011, Air India and Indian Airlines merged along with their subsidiaries to

form Air India Limited.

Financial crisis

Around 2006-2007, the airlines began showing signs of financial distress. The combined

losses for Air India and Indian Airlines in 2006-07 were 770 crores (7.7 billion). After the

merger of the airlines, this went up to 7,200 crores (72 billion) by March 2009.This was

followed by restructuring plans which are still in progress. In July 2009, SBI Capital Markets

was appointed to prepare a road map for the recovery of the airline. The carrier sold three

Airbus A300 and one Boeing 747-300M in March 2009 for $18.75 million to survive the

financial crunch.

As of March 2011, Air India has accumulated a debt of Rs. 42,570 crores (approximately $10

billion) and an operating loss of Rs. 22,000 crores, and is seeking Rs. 42,920 crores from the

government. For the past three months (June, July, August 2011), the carrier has been

missing salary payments and interest payments and Moody’s Investor Service has warned

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that missing payments by Air India to creditors, such as the State Bank of India, will

negatively affect the credit ratings of those banks. A report by the Comptroller and Auditor

General (CAG) blamed the decision to buy 111 new planes as one of the major causes of the

debt troubles in Air India; in addition it blamed on the ill timed merger with Indian Airlines

as well.

Due to high fuel and loan costs, Indian government has already pumped 32 billion rupees into

Air India since April 2009 and in March 2012 government bailed out Air India Ltd. With

67.5 billion rupees ($1.4 billion) which the amount almost double of the federal government

has spent on new hospitals over the past three years. Air India's corporate headquarters is

located at the Air India Building at Nariman Point in South Mumbai. The airline moved there

in 1970. The Air India Building also serves as a regional office for Indian. As of 8 May 2012

the carrier invited offers from banks to raise up $ 800 million via external commercial

borrowing and bridge financing. This was stated in the documents put up on the carrier's

website.

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THE CHRONOLOGY OF THE AIR INDIA STRIKE MAY 2012

1) On May 8, 2012 about 100 pilots went on medical leave as a mark of protest while

their talks with the management were still on.

2) The reason the pilot members of IPG went on mass sick leave, protesting the

move to provide Boeing-787 Dreamliner training to pilots from the erstwhile Indian

Airlines

3) Later, the same day it sacked ten agitating pilots and de-recognized their union

after 160 pilots failed to join duty by the given deadline

4) After putting forth an original list of 14 demands, the aviators are now asking for

reinstatement of their 101 sacked colleagues

5) On the 15th of May, the Union Civil Aviation Minister Ajit Singh stated that the

Government was giving Air India one last chance and that it must perform in order to

qualify for a bailout.

6) On May 26, 2012 Aviation minister Ajit Singh announced that he would go ahead

and hire new pilots if the strike did not end soon.

7) While, AI management gave an assurance to Delhi High Court that it would look

into the hardships of the pilots sympathetically, the striking pilots have decided to end

the 58 day old strike immediately.

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8) Due to pilots' strike Air India suffered a loss of 500 crores (US$90.5 million) in 45

days. Eventually, following the intervention of the Delhi High Court, the pilots called off

their 58 day strike on 4 July 2012.

HIGHLIGHTS OF THE STRIKE

These are the critical events and features that happened during the course of the strike. It

includes the actual dialogues and excerpts as quoted to the press media including personal

interview, online interview and other sources

1) Air India pilots' strike the longest pilot stir in 40 years.

2) Strike of Air India pilots illegal: Ajit Singh

3) Air India crisis: Government in no mood to reinstate all sacked pilots

4) Pilots' strike: Air India loses Rs 500cr, extends contingency plan till July

5) Air India management could have prevented the strike

6) Air India has been harmed by its owner, the government

7) Air India suffers loss of Rs 600 crores due to 58-day pilots strike: Ajit Singh

8) Air India pilots end strike after 58 days

9) The Reason behind Air India Despair

(A) AIR INDIA PILOTS' STRIKE THE LONGEST PILOT STIR IN 40 YEARS.

The hunger protest by the pilots of Air India (AI) entered its sixth day on Friday (29TH

June 2012). The pilots have been on strike for more than 50 days now, making it the

longest running pilots' strike in the last 40 years. They went on strike on May 8 to

protest against the airline's decision to train the erstwhile Indian Airlines (IC) pilots

for the soon-to-be inducted Dreamliner aircraft. The union of the AI pilots, Indian

Pilots' Guild (IPG) was derecognised by the airline when they went on strike.

UNIONS VIEW:

The derecognised unions released a press note saying that the strike is the longest

strike in the last 40 years. In 1993, pilots of IC had gone on strike and the airline had

adopted the same indifferent approach. To replace the pilots, the airline recruited

more pilots from Uzbekistan airways.

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The airline, then, started dialogue with the pilots on strike and they were back to work

in a week. ""This means that if the airline wants, it can open dialogue with the pilots.

The idea is to resolve differences, improve working conditions and service more

passengers,"" an airline official said.

(B) STRIKE OF AIR INDIA PILOTS ILLEGAL: AJIT SINGH

LUCKNOW: Terming the strike of Air India pilots as illegal, Union civil aviation

minister Ajit Singh appealed the pilots to resume work. Speaking to reporters on the

sidelines of the inauguration of new terminal at Amausi airport, Ajit Singh said that

the ministry will solve the problems within a period of three months.

The government has already given a package of Rs 30,000 crores for the revival of

Air India. But, money alone cannot solve the problem. The airline has to be

competitive and pay attention to the cost, he said, and added that no solution is

possible by creating loss or causing inconvenience to the passengers. The government

will not adopt a victimisation policy, and whatever problems they have will be sorted

out in three months, he said.

MANAGEMENT’S VIEW: "Efforts are being made to resolve the situation. It is my

appeal to the pilots that they should think about the passengers," the civil aviation

minister said, and added, "If passengers are unhappy, it would create more problems

in days to come. If the airline does not survive, then there is no meaning of other

things like salary, promotion or increment."

The on-going protest by the Air India pilots had forced the carrier to curtail its

international flight operations, particularly those to North America and Europe. It was

following the protest that the ailing national airline lost around Rs 200 crores.

Saturday was the 12th day of strike called by pilots.

Ajit Singh also expressed his concern over the high taxes on aviation turbine fuel. The

fuel invites a tax of 40% to 50% in India, whereas in foreign countries it is around

35%. It is the cost of fuel that needs to be looked into considering the passenger

traffic and rising trade, he said.

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(C) AIR INDIA CRISIS: GOVERNMENT IN NO MOOD TO REINSTATE ALL

SACKED PILOTS

Even as the Delhi High Court on Monday pulled up the Air India management for

delaying reinstatement of the 101 sacked commanders out of the 450 striking pilots,

the government remains firm that restoration of jobs of the terminated pilots would be

on a case-to-case basis.

The court has asked Air India to seek direction from the Centre and respond by

Wednesday (July 18) on whether the committee set up to look into the reinstatement

of sacked pilots can resolve the issue within four weeks.

One of the members of the Indian Pilots Guild, the union that went on strike on May

7, said the court accused Air India of "sitting on conciliatory proceedings," adding

that it was a very good day for them.

However, the government remains stiff on its earlier stance that the cases of pilots

will be looked into individually. "Air India has been asked to respond on considering

reinstatement of sacked pilots. Consideration doesn't mean taking everyone back," a

senior official from the civil aviation ministry.

Such a response comes in the wake of government's plan to rationalise Air India's

international operations further, leading to a reduction in the total number of pilots for

overseas routes by 40%.

"There were a total of 750 pilots for flying on international routes before the strike

and we never needed so many. Now the requirement is for only 400-450 pilots as per

our new plan," another official from the aviation ministry said. During the nearly two-

month-long strike, the AI management had sacked 101 of the 450 pilots and currently

the agitators and the company are negotiating over how to reinstate them.

Sector players say the airline is not only using this opportunity to cut excess flab but

also send out a message that the government will be tough on those who jeopardise

operations, especially at a time when the airline is struggling to stay afloat and has

just received Rs 30,000-crores bailout funds.

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According to Air India officials, it's not just the fact that the airline would now require

fewer pilots, but many of them also stand to lose their licences if they are unable to

clear the medical tests the company plans to put them through.

"Pilots who have claimed sickness for two months have been asked to submit medical

reports. But verification of the two-month long sickness and related tests and reports

may catch pilots on the wrong foot," a company official said on anonymity.

As per Rule 42 (2) of the Aircraft Rules, 1937, the holder of a licence shall not

exercise the privileges of his licence without being declared fit after a fresh medical

examination in the event of his having "a sickness or injury involving incapacity for a

period of fifteen days or more for which he is licensed..." According to a letter by the

Director-General of Medical Services (Air), prescribing the procedure on sickness

examination, the medical department of Air India will apply for a no-objection

certificate (NOC) to Director of Medical Services at DGCA for each pilot.

(D) PILOTS' STRIKE: AIR INDIA LOSES RS 500CR, EXTENDS

CONTINGENCY PLAN TILL JULY

Cash-strapped Air India has suffered a loss of around Rs 500 crores due to the 45-

day-old pilots' strike, forcing the airline management to extend its curtailed

international flight plan till July 31.

Air India has lost around Rs 500 crores in terms of revenue in the on-going strike, as

the airline has been incurring losses to the tune of about Rs 10 crores per day, sources

told PTI today, a day after Air India CMD Rohit Nandan said the national carrier was

also "making some substantial savings". "It was not possible to calculate the savings

now, as we have to fulfil our commitments to our vendors on quarterly or half-yearly

basis. At least we are making savings on some of the flights like Delhi-Toronto, on

which we were losing Rs 300 crores annually," he had said.

The on-going stir has forced the airline management to extend its contingency plan

for the fourth time, since the strike began on May 7, till July 31.

"We have decided to extend our interim schedule for international flights, as part of

our contingency plan, till July 31 or unless the strike is called off before that day," an

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Air India official said. Under the interim schedule, Air India would operate 38

international flights per day instead of 45 that it operates under normal conditions.

Domestic operations of Air India are also being run normally and there have been no

disruptions due to the present agitation, he said.

(E) AIR INDIA MANAGEMENT COULD HAVE PREVENTED THE STRIKE:

The causes that triggered the strike

Cause 1 :The latest decision taken by the Air India management on the Boeing 787

Dreamliner issue is yet another example of mismanagement and political interference

involved in running of this government-backed carrier. It questions a critical decision taken

by the airline management which trigged off the 58-day pilots’ strike that wrecked the

airline's flight schedule during the peak travel season. The management were unable to

answer the following questios in light of the strike:

i. Why was the airline management in such a tearing hurry to send pilots from the

erstwhile Indian Airlines (IC) to train on the B787 aircraft?

The first batch of IC pilots were sent by the airline management to Singpaore for B787

training on May 6. In response, the pilots from erstwhile Air India (AI) went on a strike from

May 7 onwards. Now the 32 IC pilots are back after completing their B787 training. But the

airline management has asked them to do a refresher course and go back to flying A320

aircraft, which is the one they flew before they were sent for the Dreamliner training.

ii. So what was the point in rushing the IC pilots for B787 training? Had the

management not rushed with its decision to send IC pilots for B787 training, the AI

strike would not have happened.

The B787 training had turned into a contentious issue as it was the first aircraft-type for

which the management decided that pilots from both the sides of the merged airline those

from the erstwhile Air India and Indian Airlines respectively, that is would be sent to train on

it and fly it. Since all the aircraft orders were placed before the merger the norm followed in

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the merged airline till then was that Indian Airlines pilots would train and fly the aircraft

ordered by Indian Airlines and vice versa.

Now, the B787s were ordered by the erstwhile Air India and so the airline management was

in talks with pilots from the erstwhile Air India to solve their career progression worries as

they would have to share their B787 pie with Indian Airlines pilots. But even before the talks

could reach a conclusion the management, without a warning, decided to rush IC pilots for

B787 training on May 6.

Cause 2: "That was the only reason the strike broke out. Had they reached an agreement with

the AI pilots on their career progression issue before sending the IC pilots for training the

strike would not have happened,'' said an airline top official. Had Air India been a private

airline then the officials who took the decision to send the IC batch of pilots to train on May 6

would have had some tough questions to answer. But it is a government-carrier and it has

taxpayer's money to bail it out. AI insiders contend that it's a give and take. After all, they

dish out a lot of freebies to the politicians and the government.

(F) AIR INDIA HAS BEEN HARMED BY ITS OWNER, THE GOVERNMENT:

An interview with the former executive director of Air India: Jitender Bhargava

Why so many pilot strikes taken place in Air India lately? Has the management

been insensitive to pilots’ concerns, forcing them into unreasonable behaviour?

In the present case, what should the management do to appear reasonable in

dealing with the pilots whose strike was declared illegal by the judiciary?

Though AI has been reeling under heavy losses, there have been three strikes by pilots in

the last three years. No demand, no matter how genuine, can justify a strike in today’s

situation.

Successive managements have also been insensitive to issues raised by the unions. This is

because of a weak HR setup, lack of structured policies and their inconsistent application.

The management has taken decisions under duress, appeasing one section of employees at

the expense of others.

Should an airline tolerate overpaid pilots taking medical leave en masse on false

pretexts and leave passengers — who pay through their nose — in the lurch?

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Some of the pilots’ demands, such as they should decide who should be allowed

to train on the new generation aircraft, sound absurd.

While pilots should follow the industrial laws applicable for strikes, they earn salaries that

appear huge to a common man but are largely in tune with global standards. If there is a case

of overpaying the pilots, the management personnel who have signed such obnoxious

agreements should be held guilty and accountable. As regards training of erstwhile Indian

Airlines pilots on B787s, a decision ought to have been taken guided solely by the interests of

the airline.

Should fat-salaried pilots be deemed to be workmen and allowed to go into trade

union action?

Well-paid pilots certainly don’t deserve to be deemed “workmen”, but the description has

legal validity. AI had for years drawn the attention of the authorities to this anomaly, but to

no effect.

The root cause of much of the strife in AI seems to be the 2007 merger (of Indian

Airlines and Air India) that led to the formation of a unified carrier. Can the two

sets of employees think of themselves as one unit?

Merger is undoubtedly at the root of the current problems. Although HR issues were cited as

problems before it was decided to merge, these were not addressed. The civil aviation

ministry, which was to guide the merged entity in resolving parity and other issues, appointed

the Justice Dharmadhikari Committee for the purpose only in May 2011, three years and

eight months after the merger. Who is accountable for this lapse? Or, did the ministry wish to

let the merged Air India embroil itself in problems?

Will the implementation of the Dharmadhikari report cure the HR-related ills of

AI? Will wage cuts work?

It is unlikely that implementing Dharmadhikari committee’s recommendations will help

address the HR concerns. AI may, in fact, witness the sinking of employees’ morale even

further. This was an important committee but its report does not raise any expectations.

It was said that implementing the report will result in a saving of Rs 250 crores in the wage

bill, but this seems unlikely as the cost neutrality principle has been violated in many of the

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recommendations. The report is neither just nor sound from the point of view of managing

the airline productively and efficiently

In view of the massive bailout package for Air India from the taxpayers’ money,

do you think that the Turnaround Plan (TAP) for the airline —monitored by the

government — will succeed?

As long as the inherent weaknesses of the management structure (board of directors, chief

executive, senior management), and of the work culture, are not addressed, no TAP can

succeed. Mere infusion of funds is unlikely to help as the management structure responsible

for AI’s decline in recent years (through faulty policies) has been given the job of turning the

airline around. This is ironical.

The reason why the airline has been consistently losing market share and figuring way down

in terms of on-time performance and load factor amongst all airlines should have been

studied for remedial action if the TAP were to have any chance of success.

Is it time to sell the national carrier? Will there be takers?

Air India can be salvaged if structural changes in management can be made and professionals

are allowed to run it on commercial terms. There is no hope as long as civil servants manage

it with constant interference from the ministry. With its current level of losses and debt, AI

cannot be a good business proposition for a potential buyer.

(G) AIR INDIA SUFFERS LOSS OF RS 600 CRORES DUE TO 58-DAY PILOTS

STRIKE: AJIT SINGH

NEW DELHI: Air India has suffered a loss of around Rs 600 crores due to the recent

58-day-long strike by its pilots, Civil Aviation Minister Ajit Singh said today.

"The total loss of revenue already caused to Air India due to prolonged strike by the

pilots is approximately Rs 600 crores," he told the Rajya Sabha in a written reply.

He said a section of Air India pilots represented by Indian Pilots Guild started

reporting sick from May 7, in protest against the management's decision to train pilots

of erstwhile Indian Airlines to fly Boeing 787 Dreamliner aircraft.

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The minister said due to the strike the national carrier had to restructure its operations

and operate 39 international flights against 46. He also informed that Air India

management has derecognised the pilot's union and terminated the services of 98

pilots.

In reply to separate question, Singh said, "No recruitment action has been initiated by

the Air India management."He also said Justice Dharmadhikari Committee had given

its recommendations and the government has sent it to Air India management for

implementation. "Air India has also prepared a Voluntary Retirement Scheme for its

employees," Singh said.

(H) AIR INDIA PILOTS END STRIKE AFTER 58 DAYS

Legal proceedings involved in the end of the strike

The 58-day protracted strike by Air India pilots was called off on 4th

July after the

Delhi high court asked them to join duty within 48 hours and the management to

sympathetically consider their grievances.

The decision to end the strike was announced by the Indian Pilots' Guild (IPG) after a

meeting of its managing committee in Mumbai.

In the late night statement, the IPG thanked the Indian judiciary, especially the Delhi

high court, "for mediating in this issue, which is critical to the survival of Air India

and is in the national interest".

"We the pilots of Air India and members of the Indian Pilots Guild, on the

intervention of Hon'ble Justice Ms. Reva Khetrapal of the Hon'ble Delhi high court

have started the procedure to resume work," the IPG statement issued after the

meeting said.

It said that as directed by the high court, the IPG looked forward to negotiations with

the AI management on all pending issues in the presence of the chief labour

commissioner.

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"We sincerely hope that the AI management and the civil aviation ministry will be as

sincere on their part. On this understanding, we are commencing the process of

restoring normalcy of operations," said IPG general secretary E A Kapadia.

The IPG statement came after its counsel, Geeta Luthra, told the high court that the

striking pilots numbering 434 will join their duties in 48 hours.

During the two-hour-long court proceedings, the judge said the pilots are not

"goondas or criminal elements. You consider their grievances after talking to them."

"The senior counsel (Luthra) appearing for the pilots has said that her clients will

immediately call off the strike and join their duties in 48 hours, by giving joining

reports or the report expressing their willingness to join the duty.

"The AI management shall sympathetically consider the grievances of the pilots

including the aspect of reinstatement of those pilots whose services were terminated

as a consequence to their strike," Justice Khetrapal said while disposing of the pilots'

plea for a direction to the AI management to take back the 101 sacked pilots,

including 10 IPG office bearers.

Earlier, the IPG welcomed the high court's order. "The court has made very positive

observations. It has said that all pilots should be taken back and no distinction should

be made between those sacked and others. We are happy with the court's

observations," IPG joint secretary Tauseef Mukadamn said.

The pilots went on strike on May 7 over demands for better career progression. The

airlines management took a tough stand sacking 101 pilots including 10 office bearers

of the IPG which was also derecognised.

Justice Khetrapal, who also sought a report from the conciliator by July 9, was

hearing an application of the IPG which had alleged that the management has created

a "hostile environment" by sacking the striking pilots and also derecognising it.

The court directed the pilots as well as the management to appear before the

conciliator, chief labour commissioner N K Prasad, on July 6 at 4.30pm.Appearing for

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the management, Bhasin said the court should not entertain the pilots' plea as they are

in contempt.

He submitted the management is ready to talk to the pilots once they call off their

strike.

"They are in complete disobedience of the court's orders for the last two months and

they need to call off the strike first before talking to the management regarding their

demands.

"Let the counsel for the pilots make a statement before this court that they are ready to

call off the strike today. They should not make any pre-condition to call off the strike.

First they should obey the court's order and then talk to the management," Bhasin

said.

To this submission, the court asked the pilots to call off their strike.

CONCLUSION: MY UNDERSTANDING ON THE STRIKE

Air India crisis has shocked the whole nation .Pilots refusing to fly while

Management refusing to talks has disturbed the air traffic of India so much that people

are now relying on Trains for any Business Class Travel needs.

Air India is at war, with itself. There are two systems working side by side in the flag

carrier and the current pilots’ agitation, if anything, exposes that.

In 2007, the government had merged Air India (AI) and Indian Airlines (IA) to make

one of the largest airlines in the world by fleet-size and manpower. Five years down

the road, it has come not to be.

Insiders today say that though they sit in the same offices and share a common brand

name, the split is wide open, as two systems compete to run one airline.

Not just pilots and the cabin crew, even managers and junior staff from both sides

fight over allowances, pay scales and even holidays.

On the surface, it looked like an issue with the pilots. But when contacted by IANS,

even the cabin crew-in-charges, cargo managers and other functionaries voiced the

same resentment over the merger.

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“The merger created problems that cannot be solved. Our grades, work, promotions

and allowances are different. When you see your colleague from the other cadre doing

the same work, but getting easy promotions, allowances, there is bound to be

resentment,” a senior official with the operations arm told this correspondent on

condition of anonymity.

“The company below the rank of DGM (deputy general manger) is not at all

integrated. There are two systems of promotions, allowances and even foreign

postings.”

Another official with the airline’s cargo division said the problems started when the

two systems collided. AI was following a system under which the department head

has the discretionary power to promote and the promotions are time- bound, while IA

had a strict Human Resources (HR) code of interviews and written tests.

“These are just initial problems. Once the Dharmadhikari report is implemented, I

don’t know what criteria it has but if it comes with the rider that the pay scale would

be criteria for seniority, promotions will be a major problem.”

Not just that. In the pilots case, while a commander of AI gets Rs.8 lakh per month

that of IC gets Rs.3 lakh per month. Even a bare minimum flying allowance of 80

hours is granted to AI pilots while it is only 72 hours given to IA pilots.

“In this case there is also an issue of promotion. We don’t get to fly as much as our IC

counterparts do, thereby reducing our flying hours and a chance to get to the higher

grade,” said an agitating pilot.

Both sides also play the blame game by stating that overseas assignments as station

officers are restricted for IA officials as traditionally they only had three foreign

branches.

No one knows what the report by Justice D.M. Dharmadhikari submitted in January

actually has suggested. Details are not available, but it is understood to have talked

about the mess in the airline and has made recommendations on such critical issues

like career progression, integration across various cadres, rationalisation of pay scale,

allowances and incentives and overall restructuring of the entire staff of the erstwhile

Indian Airlines and Air India.

―Therefore it can be understood the root of the problem is with the untimely and

misjudged merger of the two airlines that has been the primary reason for the never

ending ordeal of Air India. Measures have to be taken up so as to conclude the

Ragavendra.B

09MBI050

misunderstandings between the management and the unions, if this is not feasible then

it is time that the Airlines split from their troublesome merger as suggested by industry

experts so as to the root problem will be hence solved. This will prove to be rather

beneficial to the airlines, the government and the public as well‖

References:

www.timesofindia.com

www.economictimes.com

www.ndtv.com

www.airindia.com

www.businessworld.in

www.ibn.in

www.Aviation-safety.net

www.cbn.in

www.outlook.in

www.Financialexpress.com

The Wall Street Journal