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Informist, Friday, Mar. 20, 2026

 

NEW DELHI – The Delhi High Court Friday upheld two arbitral awards passed in 2016 asking Air India Ltd. to pay INR 579.25 million and INR 781,768 to All India Aircraft Engineers Association and Indian Aircraft Technicians Associations, respectively, along with interests. The arbitral tribunal had asked the airline to pay wage arrears to its employees, noting that arrears were payable from 1997 and the airline could not deny these by relying upon the Department of Public Enterprise guidelines and Presidential Directives to contend that payments were only prospective or contingent. 

 

The high court said that while Presidential Directives are binding administrative instructions, they do not partake the character of statutory law. The arbitral tribunal was competent to examine all issues necessary to effectively adjudicate the dispute, including the validity and effect of the Presidential Directives, said the court.  

 

The case has its genesis from 2,480 employees of Air India claiming arrears from Jan. 1, 1997, under Department of Public Enterprises guidelines of 1999. In 2006, the Presidential Directive had required conformity with the 1999 guidelines but imposed prospective implementation, notional fixation, and payouts contingent on cash-flow capacity. Disputes arose after notional wages were fixed from Jan. 1, 1997 but actual payments were limited to 2005 and 2006. 

 

This led to growing discontent among the employees who agitated that, unlike their counterparts in other Air India arms, their settlements did not provide for payment of wage arrears from 1997. The employees said that they were denied arrears for the period from 1997 to 2005. 

 

In 2016, the tribunal held that Air India had unequivocally admitted to wage arrears and the same were payable from 1997. The tribunal rejected Air India's argument on financial incapacity and cash flow contingency and directed payment with interest and costs.  End

 

Reported by Surya Tripathi

Edited by Deepshikha Bhardwaj

 

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