Industrial Dispute at Jet Airways


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A small brief ppt of the industrial dispute that Jet Airways faced.

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Industrial Dispute at Jet Airways

  1. 1. Overview & Industrial Disputes in Jet Airways Sub: Industrial Relations (IR) The joy of Flying
  2. 2. Introduction  Jet Airways was founded on 1993 by Naresh Goyal.  Jet Airways has come a long way to becoming the fastest growing airlines in the world with 13,945 employees currently employed with the organization.  Jet Airways is offering 73 Destinations in total 19 Countries - Each connected every 10 minutes.  Naresh Goyal moved in to buy Sahara Airlines a year later for Rs 1,450 Crores in 1994, when Airlines market growth rate was 30-35%.  Jet air ways have a massive airship fleet size of 100 aircrafts.  Jet Airways (Jet+JetLite) had a market share of 22.6% in terms of passengers carried, thus making it a market leader in India.
  3. 3. Current state of Jet Airways Important Officials of Jet Airways: Founder & Chairman: Naresh Goyal Appointee CEO : Gary Toomey Interim CEO & COO: Capt. Hameed Ali. Annual Revenues –  Rs.14,401 Crores (2010-2011)  Rs. 17.28 Crores (2011-2012)  Profit/Loss After Tax –  Rs.27 Crores profit (2006-2007)  Rs. 1.4Crores loss(2011-2012)  All Other Domestic Players showed loss(2006-07) 
  4. 4. Achievements & Awards Best First-Class Service in the World award at Business Traveller’s 20th annual ‘Best in Business Travel’ awards.  Best Business Class & Best Economy Class at the Business Traveller Awards  Best Overall in Entertainment at the Avion Awards 2010  India's Popular Domestic Airline at the SATTE 2006 Awards  India’s Airline at the World Travel Awards, 2006  18th TTG (Travel Trade Gazette) Travel Awards 2007  India’s Most Respected Company in the Travel and Food Sector by Businessworld 2003  Business Traveller’s Best Indian Airline Award in London. 
  5. 5. Airship Fleet           Airbus A330-200 Airbus A330-300 ATR 72-500 ATR 72-600 Boeing 737-800 Boeing 737-700 Boeing 737-900 Boeing 737 MAX 8 Boeing 777-300ER Boeing 787-9 Boeing 777-300ER Boeing 777-300ER
  6. 6. Market for Jet Airways   International market Competitiors - British Airways & South West Airlines Domestic market Competitors - King fisher, Indian Airlines, GoAir, Spicejet & Indigo
  7. 7. Industrial Disputes in Jet Airways Jet Airways faced Two Major industrial crisis during its lifetime:   1900 Employees Sacked and then Reinstated in 2008. The Pilots Revolt 2009
  8. 8. 1900 Employees Sacked & then Reinstated  According to CAPA, buying Sahara was a big strategic mistake by Jet Airways.  Jet had been constantly incurring losses since 2007-08.  In 2008, Naresh Goyal entered into an operational tie-up with arch rival Vijay Mallya’s Kingfisher.  Further, Jet sacked 1,900 cabin crew members in October 2008, all probationary and temporary workers, across all categories and departments.  The Sacking was justified as an attempt to switch to leaner business models and cost-optimize the business operations of the airways.
  9. 9. 1900 Employees Sacked & then Reinstated "It is an unfortunate decision, which all of us in the company regret. A total of 1,900 people are being served separation notice. 800 have already been served notice. In the next few days the others will also be served notice. It is an attempt to save the jobs of remaining 11,100 employees," said Executive Director B Saroj Datta.  A severe backlash resulted, not just from employees but also from the government, political parties and regulatory bodies.
  10. 10. 1900 Employees Sacked & then Reinstated  In a very dramatic Press conference by Jet Airways Chairman – Naresh Goyal reinstated the employees a day later saying that he was not aware of these sackings.  “I was not there when this decision was taken. I came to know about it later. I have not been able to sleep all night. I apologize for what has happened & I request all of you to start work from tomorrow morning,” Goyal said.  The company had said it was forced to trim staff to cut its losses but Goyal claimed that he had not been consulted before the Jet senior management ordered the retrenchment.
  11. 11. 1900 Employees Sacked & then Reinstated "The sackings were completely illegal. There was no notice nor was government’s permission taken to sack 1800 employees. Perhaps they realized their folly and decided to take these employees back. The matter would have landed in the court." - Anand Pujari, Labour lawyer, SI Joshi & Co. in October 2008
  12. 12. The Pilots Revolt 2009  The young pilots got insecure seeing the previous scenario and led to formation of National Aviators Guild the NAG on 24th July, 2009; registered by the Regional Labour Commissioner.  On July 31, 2009, the two senior pilots of Jet Airways, who were both office-bearers of NAG, were dismissed by a single-line e-mail stating that their services were terminated with immediate effect and no reasons were assigned for the same.  The pilots were accused of coercing all the others on joining and forming a union.  The NAG requested management for discussion an representation, which fell on deaf ears.
  13. 13. The Pilots Revolt 2009  NAG issued a strike notice on August 24, 2009.  The management obtained an ex parte order from the Bombay High Court by virtue of Sections 22 and 23 of the Industrial Disputes Act restraining the NAG from striking.  Total of 500 pilots reported sick and went unanimously on leave.  Series of discussions took place in the presence of Regional and Chief Central Labor Commissioner.  The major regulations referred for this case were Trade Union Act, 1926 & Industrial Disputes Act, 1947.  All discussions were meeting a deadlock n stalemate situation.
  14. 14. The Pilots Revolt 2009  During this 14 days of strike continued causing a loss of estimated Rs.15 Cr per day and hardship to innumerable customers due to flight cancelling.  The NAG withdrew the strike notice on the evening of September 7, 2009  The matter was yet to be resolved as the pilots were still agitated on their unfulfilled need.  Finally, a draft was worked out late night between Congress leader Sanjay Nirupam, representatives of the pilots and Jet Airways Chairman Naresh Goyal.  The management agreed to reinstate the sacked pilots on the condition that it would reconsider the wisdom of a union.
  15. 15. The Pilots Revolt 2009  The negotiations ended with the formation of a grievance committee consisting of both pilots and administration members to hear such cases.  It was decided that a committee to look into the coordination between the pilots and the management would be formed.  The committee would work under the Central Labour Commissioner.  Normal flight were resumed on Sunday morning 11th September, 2009.