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    Posted on 02 April 2012
    OPINION  
    Amitava Ghosh

    Grounded!

    Withholding salaries of airline staff is a violation of the payment of wages act of 1936

    By Amitava Ghosh

    Photo: Deepak Salvi

    THE RECENT case of blocking compensation and thereby, flouting the basic rights of an employee by some reputed airlines leads to the perception that a job in the aviation sector is highly risky in today’s turbulent business climate.


    What these companies don’t realise is that delayed payment of wages is not just a violation of the Payment of Wages Act, 1936 but also causes delay in contribution under the Employees’ Provident Fund & Misc Provisions Act, Profession Tax Act, etc, all of which amounts to breaches of statutory provision and can attract penal provisions

    Under section 3 of the Payment of Wages Act, 1936, it is the responsibility of every employer to pay wages within a stipulated period. No employer can block salaries, even when the company is in the red.

    Even where a competent authority is satisfied that the delay was due to an emergency, or the existence of exceptional circumstances, Section 17A of the Act stipulates attachment of the property of the person responsible, in case he/she defaults in paying wages to employees within a prescribed time limit.

    While the direct impact of recession in the case of these aviation companies is undeniable, withholding compensation smacks of unfair labour practices. At present, nearly 1,200 airlines employees of Kingfisher, Jet Airways and Air India are on a stir, reflecting the serious state of affairs with this industry.

    In any business, the organisation has a clear estimate of the wage bill and the cost of each employee to the company that must be payable over and above all other costs. If an organisation claims it is unable to do so because it’s in the red, the excuse would be inadmissible, as it’s easy to see that debts of companies like Kingfisher were not accumulated in a day. They had sufficient warnings in their daily financial transactions that they ignored and must have had several opportunities to take remedial measures in the past. Blocking employee salary as a last recourse, to clear third party debts is completely unwarranted and undesirable. Kingfisher’s wage bill would anyway be just a fraction of its mounting debt.

    It’s significant to note that the pilots and crew members have remained committed to their job and have been discharging their duty until it became difficult for them to continue working any longer without pay. In denying them their dues, their employers are forgetting that compensation is not a bargaining chip; it’s their fundamental right of workers.

    No business can run without human resource and even with a high degree of automation, this resource is non-replaceable. In the past also, nearly 130 Jet Airways flights got cancelled, when their pilots went on leave, en mass. The issue then was the sacking of two pilots, something that the Labour Commissioner should have looked into and resolved at the earliest, but the case dragged on, causing a lot of hardship in the form of delayed salaries.

    Kingfisher pilots’case is more hopeless as tax authorities have frozen seven more bank accounts of the carrier. There are reports that quite a few pilots are facing foreclosures on their housing loans. In a measure, it’s good that they have refused to fly because making them work under such stressful circumstances is only going to endanger the lives of passengers and that’s something we must avoid at all costs.

    The author is senior vice president (Regulatory) TeamLease, a staffing solutions company


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    Posted on 02 April 2012
 

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