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Fictional Air India Case on Human Resource Management
1. The SARS Effect: Air India & IPG
A. Anand | K. Ahuja | N. Jain | BK Sanjay | V. Kukreja | V. Sathe
Group 2 – Section C
2. Case Overview
Air India is the Govt. of India owned airline that operates
in domestic and international sector
Indian Pilots’ Guild (IPG) is the trade union of Air India
pilots
In 2003, following SARS breakout and Iraq War, IPG
issued directive to pilots not to operate on these sectors
This caused disruption in Air India services and resulted
in a dispute between Air India and IPG
Air India, backed by the government, sacked several
pilots and derecognized the IPG.
Strike was called off.
4. Trade Union Act, 1947
A trade union (TU) can be formed by 7 or more workers
Does not indicate about recognition of TU by employer
TU has right to refuse work legitimately in case of
dispute with respect to employment conditions including
pay, hours
TU or its members can not be prosecuted in criminal
court for any action regarding industrial disputes,
including violation of employment agreement
5. Industrial Disputes Act, 1947
One of the primary objective is to prevent illegal strikes
Industrial Dispute is defined as contention between
employer and employee on terms or conditions of
employment or non-employment
Machinery for resolution of Industrial Disputes –
Works committee – Dialogue between employee
representatives and management
Conciliation – Mediation by third party like government
Arbitration – Binding decision by arbitrator like tribunal
Adjudication – Judicial process
Strike is the ultimate weapon, but reckless use can do
more harm than good, defined as cessation of work by
no. of employees for common cause (Sec. 2(q) ID Act)
6. Legality of strike
Illegal if
Reconciliation in progress or within 7 days of completion
Adjudication in progress or within 2 months of completion
Arbitration is in progress or within 2 months of completion
Award/settlement in operation, for same problem
If 14 days notice is not given for public utilities
Unjustified if
Motivated by demands unconnected with the grievances
Unnecessarily prolonged
There has been any violence
7. IPG Actions
Directive not to operate flights can be considered as strike
as it disrupts the business, IPG did not serve any notice 14
days in advance (required for public utilities) to
management of official strike or lockout
While in conciliation, IPG extended directive of non-operate
if cabin crew is coming from affected sectors, this makes
strike illegal
Reasons of SARS can be considered under employment
condition dispute, however there was no concrete evidential
data to support. Other airlines continued operations and
WHO certified the precautions taken at airport as sufficient
Real motivation behind strike may have been pay hike or
political, that makes strike unjustified as per supreme
court directive
Partial lockout (certain sectors) only could be considered as
go-slow, which is serious misconduct
8. Air India’s Action
Air India aware of differences within pilots union, with
Government support decides to break the strike through
tough measures like suspension and disciplinary action
Actions of IPG made the strike illegal, boosting Air India’s
stand on legal and moral front
Judicial, Government and Media support behind Air India
No mandate by law to recognize TUs in organization. AI
derecognized the IPG in 2003. Recognition resumes for its
successor only in 2009. This is unfair labour practice.
AI had Executive Pilots which were classified as
management cadres without any significant distinction in
job responsibilities, thereby preventing them to join IPG
IPG would have never achieve complete lockout, as it can
not force its members and non members who wish to report
on work, as forcing for strike is illegal. This makes AI’s
position strong in this bargaining scenario.
10. Handle things better
Management Action on Health Issue:
Expert Opinion: Consult with Indian Medical Association to
understand the SARS threat and measures to prevent
Understand situation: Check how other airlines are
handling the situation and what precautions are taken at
airports
Open Discussion: Alert the management if it finds current
health facilities are not satisfactory and demand the
improvements based on above points
Unity:
Fence sitters did not support cause making strike
unsustainable
Air India, aware of the situation took hard stance to break
IPG should have ensured the cause has unanimous support.
11. Handle things better
Impression Management:
Direct strike angered public, media and government
Should have explained cause to media and attempt get its
sympathetic support
People’s support translates into Government support
Mixing the issues:
IPG used SARS as mask under which it pushed several
demands linked with pay rise, training and promotions
It reduced credibility of the strike and made it unjustified
Should have set transparent agenda and made demands
Management Relationship
Management as enemy – No confidence motion
Should put certain trust, consider management as partner to
address employee grievances understanding each other’s
position
13. Government’s Action
Air India is a nationalized entity, Govt. role crucial
IPG’s stance was defiant, govt. stance appropriate
Management’s stance about FDTL agreement was
improper, no sufficient number of pilots present to
challenge
Govt. should have intervened to ensure that on such
issues views from all concerned parties are heard
Route wise differential payment policy inappropriate,
govt. should intervene to rationalize the salaries
Overall, Govt. actions were correct but not complete
14. Judiciary Action
Terming the strike illegal was correct
Management biased against agitating pilots
Even after strike was called off management was not
ready to take back suspended pilots in order to teach
them lesson
De-recognition of IPG was not correct step, as it led to
its dissolution.
Court should have intervened to ensure that
independent trade union exists to represent pilots
15. Future Trends Govt./Judiciary Role
Overuse of strikes as weapon has blunted them
Compared to 1970s era, today strikes have lost their
significance and power to influence govt. greatly.
With downfall of communism and MNC domination, trade
unions are also becoming weak.
Strikes and lockouts are loosing public sympathy.
Degraded image of government employees due to
corruption and disruption of essential services are the
main reasons.
Naturally Govt. is becoming stronger and is handling
these issues with an iron fist.
Essential Services Maintenance Act, 1981 (ESMA) when
invoked renders strikes with respect to public utilities
illegal and empowers govt. to take stringent steps.
16. Future Trends Govt./Judiciary Role
Courts in support of dialogue and not strike
Arbitrations are preferring to handle manners by
evaluating worker’s demands and accordingly directing
employers
Strikes called when arbitrations are in progress are
considered illegal
Judiciary processes in India are very lengthy, matters in
courts take long time for resolutions
E.g. Railway, Petrol Bunk owners, Milk Distributors,
Resident Doctors strike
Not in interest of common workmen, will lead to
disregard genuine demands and increase exploitation
17. Food for thought
Pilots are generally viewed by majority as “overpaid” and
they are less in number
Pilot’s sudden strike impacted common people as travel
plans affected
To face Media and public outrage, management blamed
pilots
Neither judiciary nor government supported IPG
Hypothetically imagine if IPG has legitimate demands,
will there be any change in stance of Govt./AI?
Hypothetically imagine if instead of IPG, ground staff
(low paid, high in number) association starts fighting for
illegitimate demand, would government, political parties
and media react in same way?