Vistara's sticky wage problem holds lessons for the Tata Group

Disgruntled pilots have been calling in sick, as reported, in protest against pay revisions as part of the Vistara's merger with Air India.
Disgruntled pilots have been calling in sick, as reported, in protest against pay revisions as part of the Vistara's merger with Air India.

Summary

  • Vistara is under regulatory scrutiny after scores of its flights got either cancelled or delayed this week. An Air India merger inevitability, a sticky-wage problem or does Tata need to reinforce group culture?

Vistara is under regulatory scrutiny after scores of its flights got either cancelled or delayed this week. India’s aviation regulator has asked the airline for daily status reports on its flights, which have been disrupted by a crew shortage. 

Disgruntled pilots have been calling in sick, as reported, in protest against pay revisions as part of the airline’s merger with Air India. Their new package guarantees pay for 40 flying hours a month, down from 70 hours earlier. Other work-related changes have also irked pilots, resulting in a standoff. The airline has been trying to minimize disruption by flying bigger planes to carry more passengers on fewer flights. It has also trimmed its flight schedule, but flyers have been complaining. Employee harmonization complications are not uncommon in mergers of this scale. 

For the Tata Group, which is overseeing the integration and has rarely had human resource trouble of this kind, the episode may hold lessons. Its sterling reputation as an employer hasn’t stopped even well-paid professionals from using coercive tactics for pay bargaining, it seems. An inevitability of expansion? Sticky-wage problem? Or does it need better inculcation of group values?

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