With 66 destinations, we connect a

place every 5 minutes..

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Introduction

• JET AIRWAYS : established on 1st

April 1992

• Largest private airlines of India

• Chairman : Naresh Goyal

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JET AIRWAYS’
LABOR DISPUTE:
Trade Unions and India’s
Labor Conundrum
Gist of the case
• August 2009 : Formation of National Aviators
Guild (NAG)

• July 2009 : Termination of D. Balaram and

Sam Thomas (two senior pilots) without proper
explanation.

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Cont..
• NAG says
Reason: Pilot’s active participation in
the formation of the union.

• Constitutional right to form a union.

• August 22, 2009: A strike notice from

NAG to management and labor
commissioner
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Cont..
• “The pilots were sacked because they formed
the guild. The guild is not illegal and is
registered with the labor commissioner's office.
Our only demand is they take two pilots back.
Otherwise, there will be indefinite strike.”

- Girish Kaushik
(President of NAG)

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Cont..
• August 31, 2009: Labor Commissioner

- Conciliation meeting
- Asked management to come with a
satisfactory reply by Sept. 7,
2009.
- Asked employees not to go on
strike when the talks are on.
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Cont..
• No favorable move from management- pilots went
on strike, but in legally acceptable way. That was…

MASSIVE SICK LEAVE

(650 Pilots)
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Cont..
• High chaos in airports..
• Naresh Goyal
(Chairman- Jet Airways)
blamed the pilots.

“They are behaving like terrorist. They

cannot hold the country, passengers and the
airline hostage.”
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Cont..
• Management sacked two more pilots

• Sept. 9, 2009: nine central TUs extended

their support
{ HMS, CITU, BMS, AITUC, INTUC,
AIUTUC, UTUC, AICCTU, Self Employed
Women’s Association}

• 5 days
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Losses…
• Loss of last quarter : INR 225.3 cr
• On strike days : loss of INR 20 cr. (avg)
30% drop in the ticket booking

• After : - Revenue reduction of $8 mn

- Passengers from 23000 to 7500
per day

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Cont..
• Bad publicity, cancelled flights, angry and
upset passengers.
• India’s largest private sector airline has a
debt of INR 16,000 cr.
• Management agreed to take back the
dismissed pilots on board
• Consultative group to resolve the issues.
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Cont..
IR actors
Employer: sacked pilots, no response
Employee: notice of strike, sick leave
Government: high court order and labor
commission- strike illegal
Manifestation: notice of strike
Cause of dispute: retrenchments
Method of solving: conciliation
- internal policies (expats)

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Dunlope’s model

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Cont..
• REASONS FOR JOINING TU : Changing
scenario

• Knowledge workers
-difficult to deal
-aware about rights and laws
-essential for the organization

• Importance of communication
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Cont..

• Linkage between IR and HR.

-foreign mgmt. (IHRM)

-culture and historical background

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Defective Legislation
• India’s age old labor laws- fragile enough
to control the labor unions.

• Strike during conciliation- a punishable

offence

mass sickness – pilots used the loopholes

of Indian labor laws well.
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Cont..
• Pilots – disrupting an essential services
• Management – accused of discrimination
BUT NO ACTION TAKEN AGAINST
THEM

• Indian Labor Laws – power to unions

(tremendous increase in the no. of unregistered
unions that have nothing to do with the interest
of the organization)
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Cont..

• Many common items are differently in

different acts. (Also PM of India commits
about overlapping provisions)

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NEED FOR REFORMS

• Labor unions demands and competitive

field of business
• Increase in the contract labor – reduced
union activities
• High inflexibility due to the nature of the
labor laws ( 50- central acts, more than
150 state variance)

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Cont..

• Alarming increase in lost work days

• Jobless economic growth (labor force

growth rate: 2.5%, employment growth:
2.3%)

• Inspector Raj in the industry ( Indian

factory inspected by 30 inspectors on an
average)
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Awareness but no actions
• “… The time has come for us to take stock
of our labor laws and see how best we can in
fact serve the interest of our working
people…”
- Dr. Manmohan Singh

• Second Labor Commission 1998 to suggest

rationalization of existing laws relating to
labor in the organized sector.
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HOPE..

• Sept. 2009, IT and ITES establishments

exempted from the provision of Industrial
Employment Act 1946.

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Cont..

• Reforms are happening but not at

expected scale and level..

• India would struggle to find the growth of

it does not give importance to labor
reforms.

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Presented By: Group 1
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