Air India-employee tussle set for round 2 before Tribunal

The long standing dispute between employee unions and Air India, over pay-cuts, climaxed Monday with the Bombay HC refusing to go into merits of the issue and referring the matter to the Industrial Disputes Tribunal.

In 2012, Air India had affected pay cuts to the extent of 25 percent. These pay-cuts were subsequently challenged before the Bombay HC in 2013.

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The Employee Unions made various submissions before the HC. The Unions argued that no intimation prior to the pay cuts had been given to the Employee Unions. Terming such ad-hoc pay-cuts as "arbitrary", the Employee Unions argued that it was in violation of the MoUs that the company had signed with the different unions.

Air India responded by citing the Dharmadhikari Committee Report. The committee had been appointed by the government to give recommendations on integrations of the work force of Air India and erstwhile Indian Airlines in a smooth manner. The Committee had recommended pay-cuts to streamline operations.

Air India also cited the weak financials of the company. The company had cited how it had been seeking capital infusion of Rs 49,100 crore. Air India submitted that it had been seeking to lower its salary bill from Rs 3500 crore to Rs 2500 crore.

Finally, Air India had submitted that the as per the Industrial Disputes Act, it was exempted from serving any notice upon the Employee Unions, prior to making pay cuts.

Importantly, Bombay HC, in its order, rejected Air India's arguments on exemptions and maintained that the airline was indeed required to serve a notice upon the employee unions before making pay-cuts.

This comes as big legal relief for Employee Unions who had been pressing hard for denying Air India the exemption. However, it has little bearing on the status of salaries. The HC has directed Air India to maintain status quo with respect to the pay-cuts.

Meanwhile, even as Employee Unions gear up for round before the tribunal, sources have also hinted that Air India is likely to challenge the Bombay HC before the apex court.

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