Why Vistara pilots are unhappy before the Air India merger

After a worsening situation over the weekend, things came to a head on Monday when nearly 80 of the scheduled daily 300 flights were cancelled, and 90 were delayed. Tuesday again saw more than 50 cancellations, and many more delays.

Pilots’ problems with pay

At the heart of the situation is an HR (human resources) issue. There is significant discontentment among a large section of Vistara pilots, mainly first officers, over their new compensation structure — a part of the pay harmonisation exercise prior to the completion of Vistara’s merger with the Tata group’s flagship Air India.

Announced in February, the new pay structure guarantees pay for only 40 flying hours (a month), down from 70 hours previously. This, many first officers fear, could drastically reduce their take-home salaries.

Early in March, a number of Vistara pilots called in sick, ostensibly to protest against the new pay structure. This too had led to flight cancellations and delays, though the airline did not cite crew shortage as the reason at the time.

In response, Vistara’s management is learnt to have issued an ultimatum to its unhappy pilots — accept the new pay structure, or give up the one-time payout that comes with it, as well as the opportunity to work with Air India post-merger.

Industry insiders say that this further aggravated the pilots, who once again started calling in sick starting last weekend.

But pay is not all that Vistara pilots are unhappy about. Many are concerned about their career progression post the Air India merger, which is expected to be completed sometime next year. Some are also understood to be unhappy with the company over its haphazard rostering practices that pilots claim seriously impact their work-life balance.

Notably, Vistara does not have a significant buffer of pilots on standby, primarily because it has slowed down hiring ahead of the merger. This makes it difficult for the airline to handle situations like mass sick leaves. In such cases, short on crew, the airline is forced to either delay or cancel flights, disrupting normal operations.

A Wednesday thaw

Things took a turn for the better on Wednesday, after Vistara CEO Vinod Kannan and other senior executives held a virtual meeting with pilots, assuring them of better rostering and allaying their fears regarding Vistara’s impending merger with Air India.

Kannan identified high levels of resource utilisation — with tight rosters leaving little room for flexibility — as a key reason behind the disruptions. He promised the pilots that corrective measures with regards to rostering will soon be put in place, and a marked difference will be visible May onwards.

Notably, Vistara will “carefully scale back the network” to slightly bring down the high crew utilisation levels.

With regard to the new contracts, sources said that there were no protests from the pilots in Wednesday’s meeting. The CEO, however, did reassure them that there will be ample opportunities for career progression, and income growth post-merger.

The disruptions have already started to ease, with the number of flight cancellations on Wednesday significantly lower than the two previous days, a senior Vistara official told The Indian Express. “If all goes well, then operations may more or less normalise by the weekend,” the official said.

Cautionary signal for Tata

Vistara’s flight disruptions suggest future problems that the Tata group might face as it consolidates its airline business.

Apart from merging Air India and Vistara, the salt-to-software conglomerate is in the process of merging its low-cost carriers Air India Express and AIX Connect (formerly Air Asia India). Once both the mergers are complete, the Air India group will operate two airlines — full-service carrier Air India, and low-cost Air India Express. Singapore Airlines, which has a 49% stake in Vistara, will own 25.1% of the merged Air India.

People integration, however, will remain among the company’s greatest challenges.

Apart from bringing about pay parity, integrating employees from different organisational cultures can be extremely daunting, causing friction over seniority, chain of command, career progression, etc.

Case in point is the 2007 Air India-Indian Airlines merger, when both were under government control. The consequent HR mess took years, multiple court cases, and government-appointed committees to be sorted.

Many insiders would even argue that the issues were never fully resolved, and fuelled lasting disaffection and grievance.