Vistara is having some trouble with its upcoming merger with Air India. The airlines have managed to meet almost all of their regulatory requirements and intend to close the merger by 2025, a process that will start in the current calendar year. However, as is usual, there is a hitch. Many pilots are not happy with the way they are being treated.

On March 6, 2024,  Vistara flights were abruptly cancelled because many pilots called in sick last minute. While the airline denied that this was an organised move to show dissent, the airline pilots told a different story to various media outlets such as The Hindu. The paper further reports that about 10-15 flight cancellations have been happening every day since February 15. In a statement, Vistara said the cancellations cannot be attributed to absentee pilots alone.

Vistara pilots were told to sign off on new contracts to get accepted in the newly merged entity.

Yesterday (March 14), the airline’s HR department informed the pilots that it was the last day to sign off on a new salary structure that would allow them to transition to the merged entity when the merger is operationalised. The catch here is that the new contract that Vistara has offered their first officers removes the mandatory 70-hour flight allowance in their current contracts and reduces it to 40 hours. Flight Allowances atop the base pay make a significant amount of the compensation for pilots in India.

The Hindu first picked up this news, and Business Standard also independently published the story. For the contact offered to First Officers, this reduces their pay to 57% of the pay they are being paid right now. On the other hand, for captains and senior captains, The Hindu states that they will have to fly 52-55 hours and 55-60 hours, respectively, to earn the salary they were getting for 70 hours of minimum flying.

The contract specifically affects 60 first officers, who were transitioned from AirAsia India and made to sign a bond of INR 9 Lakhs towards training costs, which they claim they cannot service under the new terms offered to them.

Unfortunately, the airline said they wouldn’t wait forever. If the pilots did not return the signed contracts (accepted contracts), it would be implied that they were not interested in transitioning to the newly merged entity. Additionally, they would lose a one-time payout for signing the new contract and a spot on the merged “upgrade” list, which I believe is a reference to the airline’s seniority list.

Vistara “sources” anticipate that Vistara will start transitioning aircraft operations to Air India later in the year, which will reduce the ops on Vistara itself, with a complete merger of aircraft operations anticipated within 2024 itself.

Bottomline

Vistara has some HR issues related to the upcoming merger with Air India. The airline wants to cut the guaranteed flight allowance of their first officer-ranked pilots, who will, unfortunately, make less money in the new scheme. The sword handing on their head is that the new agreement is an implied consent to transition to the merged airline, and if they don’t sign off on it, they don’t get to move to Air India. Also, they lose a one-time payout.

What do you make of the troubles at Vistara? Obviously, not everything seems hunky dory, but will it be fixed soon, or will it take time?

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