Employees plan court fight against Ford India over closed TN factory

Group rejects severance package as company winds up production

At least 65 employees of Ford India’s closed car factory near Chennai have rejected a severance package and plan to approach the courts, likely complicating matters for the company as its Gujarat unit is taken over by Tata Motors.
 

Of the some 2,000 people who worked at the factory in Maraimalai Nagar, the 65 are preparing to approach the courts to make the company arrange jobs for them. Ford India sent papers for the severance package to the 65 on Monday after getting government approval for closing the factory. The factory’s closure has reportedly affected around 40,000 jobs in places nearby as it supported ancillary units and the local economy.

“We have not signed or accepted any severance package. They released the settlement, when our petition (2A) was pending with the labour department. Now, we are planning to approach the court,” said K Kumar, who is part of a Union representing the 65 workers. Disagreement over the package started on September 9, 2021, when Ford India announced that it was phasing out its units in India and leaving the country.

“They (the 65) did not understand or agree. So after getting approval for closure from the government, severance pay has been credited to the 65 group members yesterday (January 2). An email with cover letter, table showing severance pay components (comparison with statutory 15 days for every completed year), service letter and relieving letter has been sent to each individual. A hard copy will reach their houses by registered post to their residences on Tuesday,” said a company source who did not want to be named.

As per a deal reached between unions and the company, the cumulative severance for each employee ranged from Rs 34.5 lakh to a maximum of Rs 86.5 lakh. This translated into an average of Rs 44.8 lakh per employee. “We need a job. If Ford is not doing the operations at the unit, they should ensure that we are getting jobs with the new buyer. We had approached the government asking them not to give approval for closure as our petition was pending,” said Latchuminarayanan G, another employee who did not accept the package. He said that those who accepted the severance package are finding it difficult to get a job now.

Tata Passenger Electric Mobility Limited (TPEML) acquired Ford’s Sanand plant in Gujarat in August 2022 and will complete the transaction by January 10. As part of the Rs 725.7 crore deal, Tata Motors will get the plant’s buildings, the vehicle manufacturing unit and its employees.