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AI may announce 50% incentive cut

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The Air India board, keeping with the government view that the airline should take more steps to reduce expenditure and increase revenue,
is likely to announce an incentive cut on Wednesday.

“The board may make an announcement of a 50% cut in the productivity-linked incentives (PLI) for the executive staff (senior manager upwards, officials who are not unionised),” said an Air India official. Last month, the board proposed a 50% reduction in PLI and flying allowance paid to the crew till an alternative formula was worked out. It was met with strong resistance from the unions.

The airline has been trying to introduce salary cuts for some time now. It has sought help from the government in the form of equity infusion and soft loan and finance minister Pranab Mukherjee has reportedly reviewed its turn-around proposal recently. A note to this effect would be placed before the Union cabinet soon. Mukherjee apparently iterated the stand taken by the government that the airline could not expect a bail-out package without making cost-cuts and improving revenue earnings.

While some unions have agreed to the cuts, others are against it. On Tuesday, members of the pilots’ and engineers’ trade union of erstwhile Indian Airlines voiced their protest against incentive cuts and delayed salary payments.



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