Air India may soon offer them employee stock options (ESOPs) in a bid to incentivise its staff and improve their performance. The former national carrier was acquired by the salt-to-steel conglomerate Tata Group last year, will be the second company in the Group to have an ESOP policy. In 2018, Tata Motors issued stock options (ESOPs) to its employees, making it the first company in the group to do so. Air India will become the second company under Tata to affer ESOPs to its employees.
According to people in the knowledge of the matter said that Air India will also bring in a key performance indicator for its employees — a benchmark to be used to judge their performance.
The news on Air India employees getting Esops comes days after the carrier had said that it will be restoring salaries of employees in a phased manner to pre-pandemic levels as the aviation sector is recovering with the decline of COVID-19 cases in the country.
Why Are ESOPs Offered By Companies?
Organizations often use Employee stock ownership plans as a tool for attracting and retaining high-quality employees. Organizations usually distribute the stocks in a phased manner. For instance, a company might grant its employees the stocks at the close of the financial year, thereby offering its employees an incentive for remaining with the organization for receiving that grant. Companies offering ESOPs have long-term objectives. Not only companies wish to retain employees for the long term, but also intend to make them the stakeholders of their company.
Earlier, this week, in an attempt to provide better medical facilities across a large network of hospitals across the country, Air India on Monday announced a Group Medical Insurance scheme that will be activated from 15 May, 2022. “This medical insurance scheme will be fully extendable to both permanent and fixed term contract employees and their dependents based in India,” the airline said in a statement.
The sum insured provided would be Rs 7.5 lakh per annum per family (maximum family size 7 – Employees Spouse/Partner + 3 Children + 2 Parent/Parent-in-Law) with an option of corporate buffer, to be used by employees In case of medical exigencies, it added. A detailed insurance policy and the network of hospitals will be shared in due course highlighting all benefits provided as part of the policy, the carrier added.
A dedicated helpline would be provided for employees to reach out to the assigned Third-Party Administrator (TPA) that would assist in the insurance clarifications, claim processing and any other queries regarding the insurance policy. “With the introduction of the medical insurance policy, employees would have the necessary support at their time of need anywhere in the country.”
In other news, from April 1 this year, flying allowance, special pay, and wide-body allowance of pilots are being restored by 20 per cent, 25 per cent, and 25 percent, respectively, the document had stated.
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