Get All Access for $5/mo

Akasa Air: Is There a Change In Its Employee Centric Approach? Akasa Air is suing pilots who resigned to join a rival airline without serving their notice period. However, the Federation Of Indian Pilots (FIP) emphasized that the relief sought by airline which aims to enforce the CAR against employees who violated the terms of their employment contracts, is not valid

By Shrabona Ghosh

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Company handout
Team Akasa Air receives its 20th aircraft at Kempegowda Airport, Bengaluru on August 1, 2023

"The objective is really to be an airline that people trust, our consumers trust, our employees trust," Vinay Dube told Entrepreneur India in an interview in May. Three months down, Akasa Air is suing the 43 pilots who resigned to join a rival airline without serving their notice period. Akasa Air has always emphasized on its employee centricity, however, the current scenario paints a different picture. Within almost one and a half years of its operation, the conundrum raised speculation around the shutting down of the airline, however, Akasa Air CEO Vinay Dube refuted claims and assured employees that the airline is not shutting down.

The Crisis: What Pilots Say

The resignation of 43 pilots from Akasa Air may lead to cancellation of 700 flights in September. This points at a deeper crisis. The airline has approached the Delhi High Court seeking a direction to the Directorate General of Civil Aviation (DGCA), the petitioners are seeking court intervention to direct the DGCA to enforce the Civil Aviation Requirement (CAR) concerning notice periods, as well as to take coercive action against pilots who are allegedly in violation of their notice periods.

During the representation, Federation Of Indian Pilots (FIP), involved in the ongoing notice period issue argued that the plea made by SVN Aviation Pvt. Ltd. (the petitioner) for a direction to the DGCA to enforce CAR, specifically Section 7 - Flight Crew Standards Training and Licensing Series, cannot be considered in isolation. "We asserted that it should be subject to the outcome of FIP's writ petition, W.P.(C) 8399/2017, which challenges the said CAR," FIP said.

"Our submission emphasized that the relief sought by the Petitioner, which aims to enforce the CAR against employees who violated the terms of their employment contracts, is not valid. We argued that the CAR itself falls beyond the authority granted to the DGCA under the Aircraft Act, 1934, and Aircraft Rules, 1937. Furthermore, we contended that the DGCA is not authorized to issue CARs pertaining to employment contracts. Enforcing such CARs would infringe upon the rights of pilots, as well as the provisions of the Indian Contract Act, 1872, and the Aircraft Act, 1934," FIP added.

Following the submission, the court directed FIP to submit its written arguments by Friday. Additionally, the High Court instructed the DGCA to file an affidavit clarifying its position on the cancellation of 600 flights by the petitioner due to pilot resignations, as claimed by SVN Aviation.

What Akasa Air Says

In an internal email, Vinay Dube told employees that since these acts have caused disruption and disrespect to the great work done by its current employees, the most employee centric thing it can do is to remain fiercely protective of employee's future and customers by taking actions.

Read more: Akasa Air: Aiming To Be a Cost Leader

The contractual notice period is designed to cover the interest of the travelling public by providing a transition timeframe so that passengers are not left stranded due to pilots walking away from their duties without notice. "When a small set of pilots abandoned their duties and left without serving their mandatory contractual notice period, it forced a disruption of flights between July and September 2023, necessitating last minute cancellations that stranded customers and caused inconvenience to the travelling public. Akasa Air is strongly in favour of healthy, free, and fair competition amongst airlines, as long as there is a level playing field for everyone. We also recognize that employment is a matter of free choice and we neither want to force any pilot to continue in our employment against their will nor restrain a pilot from leaving us when a pilot so desires. All we expect is for pilots to honour and serve their prescribed contractual notice period, of course, as long as we are adhering to our contractual commitments towards them. Even if one pilot resigns without serving even one day of their notice period, as was the case this time, it has a potential to cause customer inconvenience due to the size of our operations today. And to clarify, not even 24 hrs of notice period was adhered to by the concerned pilots. All we expect is for pilots to honour and serve their prescribed contractual notice period," Akasa Air told Entrepreneur India in its clarification.

Training bonds as they are commonly known across all airlines are designed to cover the cost of training a pilot and are paid back by the pilot to the airline if they resign prior to their bond coverage period. Bond coverage periods are anywhere from two to five years. A contractual notice period, on the other hand is designed to cover the interest of the travelling public by providing a transition timeframe so that passengers are not left stranded due to pilots walking away from their duties without notice. At Akasa Air, this contractual notice period is six months.

The two court cases of Akasa Air are , case 1: Akasa Air has approached the High Court of Bombay seeking their urgent intervention to obtain a stay against a small set of pilots who abruptly resigned and abandoned their positions without serving their mandatory 6-month notice period resulting in immense passenger inconvenience. Case 2: Given the acts of these pilots resulted in immense passenger inconvenience, Akasa Air approached the DGCA and agreed with them to request the High Court of Delhi to pass orders for implementing the interim order in relation to the Civil Aviation Requirement (CAR) dated 16.08.2017 governing compliance of mandatory contract notice period requirements by pilots.

"Akasa Air in discussion and consultation with the DGCA came to the conclusion that the only way to stop this behavior by the pilots resigning without serving their notice period was to request the High Court of Delhi to intervene and give directions such that the interim order of the High Court in 2018 of a past matter on a similar subject is enforced and any ambiguity is settled once and for all," the clarification added.

Akasa Air's domestic market share declined to 4.2 per cent in August from 5.2 per cent in July as pilot shortage led to cancellation of many flights last month. The carrier flew just 5.27 lakh passengers last month compraed 6.42 lakh people in July.

Shrabona Ghosh

Correspondent

A journalist with a cosmopolitan mindset. I lead a project called 'Corporate Innovations' wherein I cover corporates across verticals and try to tell stories on innovations. Apart from this, I write industry pieces on FMCGs, auto, aviation, 5G and defense. 
Growth Strategies

Learn business by doing business across the Globe: The next revolution in Entrepreneurship

As the startup ecosystem sees an influx of new entrepreneurs, the question arises: Is our current business education sufficiently equipping students for the entrepreneurial challenges they will face?

News and Trends

Will Nirmala Sitharaman Go Soft on Crypto in Her 2nd Term as FM?

This harsh treatment coupled with India's decision to not yet ban the currency has left many in a fix. So, what does the coming times mean for crypto players in India?

Health & Wellness

Get a Year of Unlimited Yoga Class Downloads for Only $23 Through June 17

Regular exercise has been proven to increase energy and focus, both of which are valuable to entrepreneurs and well-known benefits of yoga.

Marketing

6 Cost-Effective Ways to Acquire Brand Ambassadors

Boost your brand's visibility and credibility with budget-friendly strategies for acquiring brand ambassadors.

Growing a Business

He Immigrated to the U.S. and Got a Job at McDonald's — Then His Aversion to Being 'Too Comfortable' Led to a Fast-Growing Company That's Hard to Miss

Voyo Popovic launched his moving and storage company in 2018 — and he's been innovating in the industry ever since.

Making a Change

Mastering Resilience: Learn to Detach Mistakes from Your Self-Worth with Darrell Vesterfelt

A moment of crisis led to his partners asking him to step away from one of the businesses that he co-founded