Foxconn workers to accept larger severance pay by company

The enhanced package, which was concluded yesterday, has more benefits for the workers, says Union leader

The dispute between the workers and the management of Foxconn India, a part of Taiwanese electronics manufacturer Foxconn, is almost coming to an end with the union members are expected to accept the severance package offered by the company. The workers' union in Foxconn India said that it is expecting most of the workers to accept the enhanced severance package, which offers a higher amount than what the management offered earlier.

E Muthukumar, president of Foxconn India Employees Union said that the management has agreed for a higher package than what it offered earlier and also agreed that if the company reopens the facility, it would give priority in appointing the existing workers.

"The enhanced package, which was concluded yesterday, has more benefits for the workers. For instance, the salary package was increased from that of 12 months to 15 months and the compensation increased from Rs 50,000 to Rs 1 lakh," said Muthukumar. He said that under the enhanced package, the workers woudld get a maximum package of Rs 4.80 lakh, from the previously offered Rs 3.25 lakh and a minimum of Rs 4.20 lakh as compared to Rs 2.10 lakh, depending upon the experience of the worker. There are workers who has been working for 7-9 years in the facility.

The previous offer was that the workers would get two months' salary for every year of service with a cap of 12 months, along with a lump sum of Rs 50,000, three months of notice period pay, bonus of Rs 8,300 for 2014, among others.

The Union today conveyed the package to the workers in a general body meeting today and asked the workers to take their call on it. If the workers decide to refuse the package and go for legal fight, the Union is ready to support them, he said.

"We expect that most of the workers would accept the package. If anybody have an opinion against the package, they can refuse to accept the money the management put in their accounts," he said.

He said that the company, which recently floated a severance package and said that February 10 would be the last date of working for its facility n Sriperumbudur, near Chennai, has deposited an amount as per the previous package structure on February 11 itself even without the consent of the worker. While the union leader said that it is not right for the management to deposit severance package into the workers, account, he added that the additional amount as per the enhanced package would be deposited by the management into their account.

The plant was a major supplier for Nokia, which shut down its factory on November 1. The factory, after the fall out of Nokia facility in Sriperumbudur, near Chennai, had around 1,306 workers at the Chennai plant, located inside the Nokia SEZ.

In December, 2014, Foxconn informed its workers that it is suspending operations in the facility, situated near the Nokia facility, as there are no orders for it to run the plant.

The company, in a notice displayed at the boundary of the facility, said, "We are not able to give jobs to all the workers, since we don't have orders to give jobs. Since the management has declared a holiday for the factory, workers are asked not to come to the factory." It added the company is trying to find a solution through a dialogue and till that time the workers has to be patient and extend full co-operation.

FIH India Pvt Ltd, formerly known as Foxconn India Private Limited, in fact stopped operations at its factory at the Nokia Sriperumbudur SEZ near Chennai, two days before the announced date of December 24, triggering fears of massive lay-offs among workers.

One of Foxconn's key customer was Nokia, which suspended operations from November. Nokia's plant, which employed around 8,000 workers directly and another 21,000 indirectly, had to shut its plant following a tax dispute that prevented its transfer to Microsoft which bought the Finnish company's handset business early this year.