(FE)
As the Centre is gearing up to invite fresh expressions of interest (EoIs) by December 15 for the sale of its entire stake in Air India, the employees of the national carrier — over 11,000 at last count — will be offered job protection for a period of one year, sources told .
“The sale and purchase agreement (SPA) agreement will provide that strategic partner shall not retrench any employees of the company for a period of one year,” an official said. The Centre will share the SPA privately with prospective bidders at the EoI stage itself to help them take long-term view of the various liabilities and plan funding for the deal.
In any privatisation, employee issues of PSUs are of concern to buyers due to high employee costs and low productivity, typical of a government sector firm. AI’s employee cost was Rs 3,005 crore, 11.4% of the total revenue receipts in FY19. The national carrier employed 11,827 people (excluding casual workers) at March end, 2018. About 37% of the permanent employees of AI are due to retire in the next five years. “Any buyer will like to overhaul the staff in a thin-margin business like airlines to increase efficiency,” another official pointed out.
