Employee contract renewals on hold at Air India amid govt's divestment push

AI has usually been engaging people who were retiring from the same departments as consultants

Air India Ltd has put employee contracts that were coming up for renewal and proposals for post-retirement engagement on hold amid the Modi government's push for the airline's privatisation, Livemint reported on Friday. 

According to the financial daily, Air India has had difficulty in recruiting management staff for a long time. Instead, according to the report, the airline has usually been engaging people who were retiring from the same departments as consultants. With this move, that will not be possible now. However, the report added, the decision would not apply for staff required for flight operations.

All contract renewals, except those for the operational or licensed category, have been put on hold, Air India Director (personnel and finance) V Hemjadi told the airline's top management in a letter dated August 30, according to the report.

The letter, quoted by the report, said: "All proposals received for the post-retirement engagement of employees and renewals may be kept in abeyance till further orders except for operational/licensed category which has to be put up through personnel department." 

On August 24, senior IAS officer Rajiv Bansal took charge as the interim CMD of Air India, replacing Ashwani Lohani, who assumed the office of Railway Board Chairman.

  

The state-owned airline, which has a debt burden of more than Rs 50,000 crore, has been in the red for long but managed to eke out operational profit for the first time in a decade in 2015-16.

As reported on August 31, Finance Minister Arun Jaitley has indicated that an expeditious decision would be taken on Air India's disinvestment, with at least two parties having formally expressed interest in buying a stake in the national carrier. "These decisions are to be taken expeditiously but in their normal course," Jaitley told reporters on Wednesday.

The Union Cabinet had in June given in-principle approval for strategic disinvestment of the carrier and its subsidiaries. 

As reported earlier, aviation service provider Bird Group has shown interest to bid for Air India’s ground handling unit Air India Air Transport Services Limited (AIATSL). In July, according to reports, budget passenger carrier IndiGo had said that it was interested in acquiring Air India's international operations.