Air India’s New Owners Allowed To Fire Employees, Sell Airplanes To Make Profit, Reduce Loss
Bad news coming in for thousands of Air India employees, who had hoped that the new management will take better care of them.
As per reports coming in, Govt has allowed the new owners to not only sell their assets such as airplanes but also fire employees, in order to reduce losses and make profits.
This means that no job is secured for any Air India employee.
Brace for impact?
Air India’s New Owners Allowed To Fire Employees
Since regular flights are not operational as of now, most of the Air India airplanes are grounded.
When the new owners of Air India take over the state carrier, they can have the liberty to sell off these grounded aircrafts, and thus, fire employees who are no longer needed.
This has been confirmed by an unnamed Govt official, who said, “Looking at the prevailing conditions acting as an overhang on the aviation sector, the new entity acquiring AI will be allowed to sell a few aircraft or return them to the lessor. They are anyway grounded due to lack of demand. With some aircraft sold, the manpower requirement, too, will drop. Proportionately, there can be some layoffs..”
Note here, that as per the current disinvestment rules, the new owners of Air India cannot fire any employee till the first year ends.
But after that, layoffs are possible.
How Many Employees Can Be Fired This Way?
At Air India, on average, there are 133 employees per aircraft.
At Air India Express, there are approximately 55 employees per aircraft.
In case the new owners of Air India decided to sell off, say 10 aircrafts, then it will means firing of 1330 employees directly.
The official said, “If demand doesn’t improve, it will be unviable to operate those aircraft. Hence, such relaxation is likely to be given to the bidder,”
Now, there will be definitely an upper limit to the extent to which assets can be sold off.
As per a note by Department of Investment and Public Management, the new owners can be allowed to sell off 10-26% of the overall assets of the company.
As of now, Air India has a total of 121 aircrafts: 78 narrow-body Airbus A320s and 43 wide-body Boeing 777s and 787s.
We will keep you updated as more details come in.