Air India sell-off: Retired employees urge Govt for continuation of medical benefits

Our Bureau Bengaluru | Updated on September 23, 2021

According to sources, one of the bidders, Tata Sons, is not likely to pick the tab for continuing medical benefits for retired employees.


Retired employees of Air India have petitioned the PMO and the Ministry of Civil Aviation to continue the medical benefits that they have been receiving so far, even after the airline is privatised and sold off to the winning bidder.

They said that Air India, at the time of final settlement post their superannuation the employees were required to contribute to become a member of the Retired Employees Contributory Family Medical Scheme(RECFMS). The contribution had been deducted from their final settlement. There are about 60,000 retired employees and their spouses who are currently availing of the benefit.

However, sources say that Tata Sons, one of the bidders of Air India, has informed the Government that they would not like to pick the tab for continuing retirement and medical benefits of retired employees.

Some of the retired employees this paper spoke to said that the government is yet to clarify how the benefit will continue after the airline is sold off to a private enterprise.

In their letter to the PMO, they pointed out that retired employees are not eligible for a pension from the airline. The last pay revision that the employees received was in 1997. Even though the government revised the pay scales from January 2007, as per the recommendations of the 6th Pay commission, it was not implemented for Air India employees.

Later, in its order dated November 26, 2008 the Department of Public Enterprises laid down the revised pay scales applicable to all the Central Public sector enterprises with effect from January 01, 2007.

The retired employees said there is no justification for Air India not following the pay/perks applicable to other CPSEs. “After the merger of Air India and Indian Airlines, Dharmadhikari committee was set up for fixation of pay, but it was implemented only from Nov 2014 and all those who retired prior to that, were not given their legitimate dues.

As per the letter to the PMO, a post-retirement medical facility was a condition/contract of service and there is a contractual obligation. At retirement, Air India collected a large amount of money for post-retirement Medical benefits for employees and spouses. “With the impending sale of Air India, it is not clear as to what happens to the medical facility.

With a self contributory pension of a measly ₹300-2,000 per month, it is impossible to afford any medical insurance. Also, as the age advances, insurance companies are reluctant to provide medical insurance to retirees or tend to be exhorbitant and with lots of exclusions. Most of the employees never had any financial plan for possible future medical expenses during post-retirement life as at the time of joining the service they were told that the employees and their spouses would be eligible for medical facilities post-retirement,” the letter said.

CGHS facility

There have been some indications that the government is considering extending CGHS benefits to these retirees. The retirees settled in New Delhi seem to be ready to accept the same as the coverage is widespread in New Delhi. Still, the retirees based in Mumbai – where most of the employees of the erstwhile Air India (wide-body) are settled are extremely apprehensive as the CGHS coverage is negligible as none of the speciality hospitals are empanelled with it. Even for OPD and domiciliary treatment, the CGHS coverage is far from desirable. The retirees based in Mumbai are most disturbed and concerned about their future.

They pointed out that any rule which denies medical benefits to its retirees (that too as per service regulations) is against the spirit of Article 14 of the Constitution.

Published on September 22, 2021

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