Air India-Indian merger runs into rough weather

The merger between Indian (Airlines) and Air India, due in August, has hit a roadblock with the major IA unions opposing it on grounds that the government has been unable to resolve key issues -- lack of parity in career progression and salary with AI employees and arrears of over Rs 800 crore (Rs 8 billion) from 1997.

The unions have threatened a strike if these issues are not settled before the merger deadline.

Leading associations of IA -- the Indian Airlines Commercial Pilots' Association, All India Aircraft Engineers' Association, Indian Aircraft Technicians' Association, Indian Airlines Officers' Association and Air Corporation Employees' Union -- met AI Chairman and Managing Director V Thulasidas and the IA management led by Managing Director Vishwapati Trivedi on Monday.

The IA unions say an AI engineer is promoted far faster (two years, against six years in IA in comparable grades).

They also point out that the engineer-to-aircraft ratio of 9:1 is well below industry standards of 12:1, even as the workload will increase after the merger because of the expanded fleet.

IA pilots say they join at a lower grade and train for six years with a stipend before making it as captain, the starting designation for AI pilots. Also, there are disparities in salaries.

"A senior commander in IA gets Rs 9,000 as basic pay whereas his counterpart in AI gets Rs 28,000," said a member of the Indian Commercial Pilots' Association.

IA flight technicians are also protesting the cancellation of productivity-linked incentives after the merger.

Except the ACEU (whose dues were settled after it went on strike recently) all the other unions say they have ten years of arrears starting November 1997, which amount to more than Rs 800 crore.

"Though the management has agreed to pay the pending arrears to ACEU, the other unions have not been paid yet," said a union member.

However, the management is steadfast in pushing the merger through despite union opposition. Thulasidas told Business Standard, "The merger is well on track and should happen by the end of July or early August. Union Civil Aviation Minister Praful Patel had met employees of both the airlines and assured them that their interests will be protected."