Air India offers second VRS since Tata takeover
1 min read . Updated: 17 Mar 2023, 11:26 PM IST
PremiumThe new round has been offered to all permanent general cadre officers who are at least 40 years and completed at least five years of continuous service at Air India
Air India unveiled a second round of an early retirement scheme for employees in just about a year since its takeover by the Tata group. The move underscores efforts by the once state-owned airline to prune its workforce and cut costs.
Mint was the first to report on 4 November about Air India’s plan to introduce a second voluntary retirement scheme (VRS) to trim staff costs and pave the way for a younger workforce.
The new round has been offered to all permanent general cadre officers who are at least 40 years and completed at least five years of continuous service at Air India. This includes clerical and unskilled employees.
Those applying from 17 March to 30 April will also be provided with an ex-gratia amount as a one-time benefit. Other eligible employees who apply until 31 March will receive ₹1 lakh in addition to the ex-gratia amount.
The loss-making airline launched the first phase of VRS in June 2022. It was offered to 4,500 eligible employees above 40 years and who have completed 20 years of continuous employment.
“There has been a request from employees for extending the additional benefit of voluntary retirement to other permanent employees as well," read an announcement by Air India to its employees.
The first VRS offered by Air India since its takeover in January 2022 was accepted by 1,500 employees. At the time of its privatization, the airline had about 12,085 employees, of whom 8,084 were permanent employees.
Meanwhile, Air India, owned 25.1% by Singapore Airlines, has been looking to add new talent in line with its transformation plan. It plans to achieve accelerated growth in domestic and international aviation markets.
The company is also trying to reduce the multiplicity of roles and bring in more efficiency in manpower, a person aware of the development said, requesting anonymity.
The airline aims to achieve a 30% share in both domestic and international markets in the next five years. Currently, it has a domestic market share of 10% and an international market share of 12%.
Last month, the full-service airline placed a mammoth order of 470 aircraft with an option to extend the order size to 840.
Air India, along with AirAsia India, Vistara and Air India Express, are currently under the umbrella of Tata Sons, the holding company of the diversified Tata group.
