The Mahindra & Mahindra (M&M) management and the warring trade union Bharatiya Kamgar Sena (BKS) at its Nagpur plant have signed a settlement awarding an average rise of Rs 2,501 to each employee and increasing the retirement age from 58 years to 60 years besides a host of other amenities.
The direct impact of the settlement on the Nagpur unit, which contributes Rs 550 crore to M&M's turnover, would be worth over Rs 10.47 lakh per annum. All units of the tractor and automotive major have separate wage and performance pacts with unions. The company's mother unit for tractors is at Kandivili in Mumbai, and second unit is at Nagpur while those for the automotive sector (jeeps and the Armada range) are at Kandivili, Nasik, Igatpuri and Zahirabad.
The old agreement at Nagpur came to an end on October 31, 1999, following which the BKS submitted a charter of demands to the management. Subsequently, the management too came up with a charter of requirements.
Protracted discussions were held on the issue leading to a deadlock in talks February last. The union served a strike notice on March 5 and the latter cautioned that the step could have affect all further investment plans of M&M at the Nagpur unit.
The unit at MIDC in Hingna near here was established in 1966 for manufacture of agricultural implements. The tractor assembly division was started here on September 15, 1996, when five tractors rolled out of the unit daily. The production had later reached a level of 120 tractors per day and the range increased to seven models of varying power from 25 hp to 50 hp.
The bone of contention between the trade union and the management was basically wage-related. The union had alleged that the management was going back on its promise of a substantial wage hike on the basis of which it had achieved higher productivity levels and also implemented ISO 9002, QS 9000, business process re-engineering and QS 14,000 programmes. Both parties sought the intervention of the Labour Department and the dispute was resolved through assistant labour commissioner R S Karade.
The new settlement, already being hailed as historic by the BKS, allows an average increase of Rs 2,501 to each of the 419 employees at the unit (minimum rise being Rs 1922 and maximum Rs 2935), arrears at the rate of Rs 1,150 per month for twenty-one-and-a-half months to each employee, one special increment to all permanent employees and payment of dearness allowance on quarterly basis instead of six monthly.
Other features of the settlement include, service reward to employees in the form of felicitation and a wrist watch as gift following 25 years of service or on retirement after 20 years, personal accident policy coverage with guarantee of payment of Rs 1,000 per week to any employee who suffers injuries at work, dependents of deceased employees to be paid Rs 30,000 by the management and Rs 80,000 through the benevolent fund scheme, increasing the retirement age from 58 years to 60 years, payment of gratuity increased to 17 months from 16 months, housing loan limit increased from Rs 25,000 to Rs 31,000 and hospitalisation expenses reimbursement for spouse permitted till Rs 20,000 and for two children up to Rs 15,000 each.
Employees who acquire diploma or degrees while working with the unit here will be given an encouragement reward of Rs 1,500 and Rs 2,000. Besides these additional benefits the employees will continue to receive reimbursement of hospitalisation expenses and also be eligible for M&M's Holiday Resort Scheme.
The agreement was signed in the presence of executive vice-president (manufacturing), B Mishra, Nagpur performance unit head S P Pathak and other senior officials from the company and Bharatiya Kamgar Sena president Ramakant More, Albert Pinto, Nagpur unit president, Shivshankar Pillai and other functionaries.
