Tuesday, November 7, 2017

Air India plans VRS for non-technical staff: Report

NATIONAL carrier Air India is planning a generous voluntary retirement scheme (VRS) for its employees before the government goes through with its plans to divest stake in the company, say media reports.
The government is depending on employees who are near the age of 55 years among the non-technical staff for VRS scheme. The retirement age at Air India is 58, says the report in a leading financial daily.
The technical staff comprises of pilots...
and cabin crew and the rest, including the ground staff, is the non-technical staff. The demand for technical staff is high in the market and hence, the VRS package will be for its non-technical staff.
Air India and its subsidiaries have nearly 22,000 employees. Of this, Air India has 12,000 employees, including pilots and cabin crew. “Around 47 percent of Air India’s non-technical employees are in the last five to six years of their job, and they are likely to accept VRS,” an official was quoted as telling the paper.
A high number of Air India employees have already superannuated this year. “In October itself, around 95 employees superannuated, and a similar number is going to retire at the end of November,” the official said. In case some non-technical staff decides against taking the VRS, the government will ask the new owner to absorb them.
According to the report, the average age of the airline staff is high after it froze hiring in 2012. Since then, it has hired pilots and cabin crew on contractual basis.
According to an earlier report, Air India had drawn up a proposal to buyout nearly one-third of its employees. The board has also put its fleet expansion on hold.
In June this year, the government had approved divestment of its stake in the debt ridden Air India.
In a related development, scouting for funds, Air India is in advanced discussions with public sector lender SBI for sale of at least two residential properties that could net nearly Rs 50 crore, say some media reports. While the government moves ahead with the process for strategic stake sale, the loss-making airline continues to work on the strategy to divest non-core assets.
Saddled with more than Rs 50,000 crore debt, Air India recently sought loans worth over Rs 1,500 crore to meet working capital requirements.
Against the backdrop of the severe financial crunch, the airline’s talks with the State Bank of India (SBI) assumes significance in terms of raising additional monetary resources.
The discussions between Air India and SBI are at an advanced stage with respect to sale of two residential properties in South Mumbai, sources told a news agency. While the final contours of the deal are being worked out, an airline source said the sale is expected to fetch around Rs 46 crore. Despite trying to dispose of such assets, so far Air India has managed to sell only four of its flats in Mumbai to SBI for Rs 90 crore. These properties are located at upmarket Peddar Road in South Mumbai. The carrier has been in possession of some properties which are lying vacant and unused for a long time. These include parcels of land as well as residential and commercial estate in India and abroad. Among others, the carrier has leased out almost the entire space at its previous headquarters at Nariman Point to various government agencies. As per the turnaround/financial restructuring plan approved by the Cabinet Committee on Economic Affairs (CCEA) back in 2012, Air India is required to monetise its assets and generate Rs 5,000 crore by way of sale, leasing or developing an asset as a joint venture.
Under the plan, the carrier is to get financial assistance to the tune of Rs 30,000 crore over a 10-year period.

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