Indian Pilots Guild (IPG), one of the pilot unions of Air India, has expressed hope that the outgoing management will ensure that the process of settling employees arrears is righteously carried out prior to the airline going to the new owner Tata Sons.

In a letter to Air India CMD late Sunday evening, the guild said that it is optimistic about making a fresh start with the airline's new owners, at the same time, urged the current dispensation not to exploit the employees as it could potentially lead to mass protest and industrial unrest just as the company changes hands.

According to the IPG, the 2006 Wage Agreement allocated a monthly Layover Subsistence Allowance (LSA) for captains and for co-pilots. Over the years, 25 per cent of these amounts were held back and are still due. Besides, overtime payments arising out of this wage pact are long overdue as well, it said, adding that in 2012, a wrongful and unilateral 25 per cent pay cut had been implemented on all employees.

Late last month, the central government signed a share purchase agreement with Tata Sons for the sale of Air India for Rs 18,000 crore. Tatas beat the Rs 15,100-crore offer by a consortium led by SpiceJet promoter Ajay Singh and the reserve price of Rs 12,906 crore set by the government for the sale of its 100 per cent stake in the loss-making carrier.

As we are all aware, the government is committed to settling all outstanding dues with employees pre-hand-over. In this regard, certain points must not be missed whilst implementing the said process, the IPG said in the letter. Stating that LSA was an allowance provided to sustain one's self on international layovers where the cost of living is exponentially higher, the guild said pilots would spend from their own pockets on international layovers because these sums of money were not rightfully paid on time.

The reimbursement of these foreign currency expenses that have been incurred for so many years is long overdue, it said. The arrears arising out of the 25 per cent cut on LSA are due to its members. So naturally, when these arrears are settled there should be no question of any tax burden on the pilots, the guild said in the letter.

Further, it said: This is a reimbursement of our expenses at foreign stations which have already been incurred. Under no circumstances should these arrears be considered a form of income. It is most necessary that the books of accounts reflect the same and a suitable method of disbursement be devised so as to avoid any query from the Indian regulatory authorities, the letter stated.

The company has long been aware of the liability due to employees as well as the government's commitment to settling these dues. There is a need for transparency concerning the said matter, it said. The IPG, in the letter, demanded a detailed statement with a working calculation of dues pending for each of its members.

Noting that whilst the management has acknowledged in writing that the money which was held back for several years should be rightfully returned to the employees, the guild said it would be a mockery to not properly compensate the employees with an appropriate rate of interest on the funds withheld.

It has been over nine years since the first deduction and it would be highly unjust if the company were to have enjoyed interest-free finance at the expense of the employees, the letter said. Stating that the points raised in the letter should not be taken as the guild's demands but rather as a reminder of the company's obligation to justly settle the already promised dues, the letter said at this critical juncture where the international skies have opened up and the domestic demand is steadily rising due to the festive season, the pilots are once again being stretched beyond capacity to cover additional flights.

We trust that you will ensure that the process of settling arrears is righteously carried out so as to not leave the employees feeling cheated. We are truly optimistic about making a fresh start with our new owners. We urge you not to exploit us employees whilst settling our arrears as that would probably lead to mass protest and industrial unrest just as the company changes hands, the IPG said.