In the intricate landscape of modern business, the decision to implement layoffs can be one of the most challenging endeavours a company faces. Tata-owned Air India has cut off around 180 non-flying workers in recent weeks. It noted that the affected employees were unable to use the voluntary retirement schemes (VRS) and re-skilling possibilities.
Air India Lays Off Employees
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Since Tata took over the airline in January 2022, attempts have been made to streamline its business strategy. According to an article published by Hindustan Times, staff in non-flying functions were assigned roles based on organisational needs and individual merit.
Over the last 18 months, a detailed approach was used to assess the suitability of all employees. During that time, personnel were also provided with several Voluntary Retirement Schemes and reskilling possibilities. 1% of the staff base was unable to take advantage of the VRS or re-skilling chances and was forced to part ways. The corporation stated that it is fulfilling its contractual duties. However, it is also to be noted that the number of laid-off employees is a little more than 180.
Air India was taken over in January 2022, and since then, efforts have been made to streamline the business model. During Air India’s privatisation, the government and new owners reached an agreement requiring the retention of all employees for a year. More than 2,500 employees took advantage of the airline’s two rounds of voluntary retirement plans, which were previously revealed, an Economic Times report stated.
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To Streamline Business
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— Air India (@airindia) February 14, 2024
The decision to implement layoffs as a means to streamline business operations is a complex and multifaceted endeavour. In many cases, streamlining operations through layoffs becomes imperative for organizations to optimize efficiency, cut costs, and reallocate resources towards areas of strategic importance. Air India retained Boston Consulting Group to assist with its massive staff restructuring. As part of the effort, the airline reorganized its positions, hired new talent, and increased compensation for current employees to match those of new ones.
On the other hand, domestic aviation traffic increased by 4.8% year on year to ₹1.26 crore last month, with over 1.55 lakh passengers experiencing aircraft delays. In February, Air India’s market share increased to 12.8% from 12.2%, while IndiGo’s fell to 60.1% from 60.2% in January.
What do you think of these massive layoffs?
Cover image credits: X/Air India