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Last Updated : Jan 27, 2020 05:40 PM IST | Source: Moneycontrol.com

Air India sale: All employees' dues will be cleared before closure of sale process, says Hardeep Singh Puri

In addition to this, the government said that the final buyer shall ensure that 3 percent of the equity shares of Air India are offered to its permanent employees under the employee stock options (ESOP).

 
 
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Following the announcement of the government's second attempt to divest Air India, Civil Aviation Minister Hardeep Singh Puri told ANI, on January 27, that the dues of all employees of Air India, including arrears, will be cleared by Air India Assets Holding before the closure of the sale transaction.

The expression of interest (EoI) document, released by the Ministry of Civil Aviation on January 27, mentioned that employees' dues, which are mostly in the nature of past arrears, are pegged at around Rs 1,383.7 crore.

"The employees’ dues of Rs 13,837 million on account of Justice Dharamadhikari Commission Report (included in Other Financial Liabilities shown in FY 2018-19 B/S of AI as part of Current Liabilities) is in the nature of past arrears and AI/Air India Asset Holding Ltd. will commit to pay the same at the appropriate stage before/on closing of the Proposed Transaction," the document read.

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It also noted that "Additionally, a provision of Rs 2,076.3 million (included in Other Financial Liabilities shown in FY 2018-19 B/S of AI as part of Current Liabilities) towards wage arrears accruable to employees working on Narrow body fleet, has been made in the books of accounts of AI."

Also Read | Air India sale: Government trims debt to Rs 23,286 crore, reduces net-worth criteria of bidders

In addition to this, the government said that the final buyer shall ensure that 3 percent of the equity shares of Air India are offered to its permanent employees under the employee stock options (ESOP).

"The Confirmed Selected Bidder shall ensure that 3 percent of the equity shares of the Company acquired by the Confirmed Selected Bidder (or the special purpose vehicle in case investment in AI is made through a special purpose vehicle) are offered to the permanent employees of AI as per terms of an ESOP. The detailed terms and conditions of ESOP would be provided at

the RFP stage," the bid document noted.

The government, on January 27, announced its decision to completely exit Air India, including Air India Express (AIXL) and Air India SATS (AISATS). This is seen as a major step to ensure success in its second attempt at divesting the national carrier.

Read More | Air India sale: EoI out, govt to completely exit airline

Air India

The airline, with about 14,000 employees, has a ratio of 133 employees per aircraft. This is much higher than that of private airline IndiGo which has a ratio of 108. The Air India EoI document, however, pointed out that "around 36.05 percent of the permanent employees of AI will be retiring in the next five years."
First Published on Jan 27, 2020 05:40 pm
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