Business - India;Airlines fear job losses for 8,000 ground staff

Manisha Singhal

Airline companies under the Federation of Indian Airlines (FIA) plan to make a presentation to the civil aviation ministry saying they will be forced to axe 8,000 employees if the government implements the new ground handling policy from January 1, 2009. About 29 per cent of the 28,000-odd employees working in the private carriers are involved in ground handling.


Retrenching employees in an industry reeling under losses has become a sticky issue after vehement opposition from political parties forced Jet Airways to recall 800 employees who were given pink slips a few weeks ago.

The new ground-handling policy does not allow private carriers, which currently undertake their own ground handling, to undertake the services from next year. Only Air India, airport operators (like GMR) and independent ground handling companies will be allowed to do so.

Civil aviation ministry officials said they are aware of airlines’ reservations against the new policy. “We have to look into the employment issue and then look at a solution,” said a ministry source.

According to industry sources, Jet Airways has at least 4,000 ground handling jobs on the line. For SpiceJet and IndiGo, 1,800 to 2,000 jobs are likely to be impacted between them and GoAir has some 350 employees for ground-handling service. The rest of the employees work for international carriers, some of whom undertake their own ground-handling.

A Jet Airways executive said the impact on jobs could be even more pronounced. “When we talk of about 4,000 employees being impacted in Jet if the new policy comes into being, we are not talking about another 5,000 employees who are hired as contract labour, who are also involved in ground-handling. So the larger impact of the new policy will be much more industry-wide and we can safely say at least 20,000 employees might lose their jobs,” said the executive.

Private carriers have opposed the new policy also on the ground that it will also lead to a major cost escalation. They argue that ground-handling costs will double as they have to be outsourced to third parties. It would also adversely affect service quality.

But some experts said the job losses might not be so pronounced as the new ground-handling operators will need to hire people to provide the services.

The government is pushing for a compromise under which the front-end ground-handling (where customers interact with the airline) will be left for the private airlines and the back-end work would be done by the new players. So the numbers needed to be axed might be much lower than airline companies anticipate.