Air India Looks To Cut Employee Costs
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State-run Air India, which is grappling with a liquidity crunch, is looking to cut employee costs by INR5 billion rupees (USD$103.3 million) annually, it said on Monday.
Air India's employee cost is currently more than INR30 billion.
"Besides reduction in wage cost, Air India is also looking at improving productivity of employees, elimination of restrictive work practices and reducing wasteful expenditure," it said in a statement.
The carrier, which has not laid off any employees, has established a four-member committee to examine the wage agreements, including flying allowances and productivity-linked incentives. The panel will submit its report by July 15.
Air India's chairman and managing director Arvind Jadhav has asked senior employees to forego salaries and incentives in July.
The cash-strapped airline has approached the government for infusion of funds both through equity and soft loans.
An initial public offering of shares in the firm could be considered in the near future, India's aviation minister had said earlier this month.
The Indian aviation industry has lost about USD$2 billion on an operating level in FY09, hurt by high jet fuel prices and weak demand due to the global financial meltdown.
