National carrier Air India has decided to reduce 10 per cent of allowances paid to all employees, except cabin crew, for a period of three months to tide over the economic fallout of Covid-19. The reduction is effective from March 2020's salary. The reduction will not impact the Basic Pay, House Rent Allowance and Variable Dearness Allowance, the airline said in an office order seen by IANS.
According to the order, Covid-19 pandemic has adversely impacted aviation industry, both in the domestic as well in the international sectors and that the insurmountable dip in revenue calls for stringent measures to reduce costs.
"All airlines have taken drastic steps to survive the current crisis and an urgent need is felt to take steps to curtail costs to mitigate the current financial crisis," the order said.
The decision was taken in an emergency Executive Management Committee meet which was held on March 18, 202.
In the cost reduction plan, the airline intends to renegotiate with lessorsa and hotels to reduce rates.
"Special drive to be undertaken to recover all pending dues from Government Departments in a time bound manner. An aggressive action is required by the concerned offices in the region as well at the Headquarters to collect the amount by the end of current Financial Year 2019-2020," the order said.
"In view of reduction in passenger load due to Covid-19, cargo sale to be aggressively taken up for optimal utilisation of available space or load to ensure maximum revenue."