Tata Marcopolo Motors Ltd. (company) was established in Dharwad in 2008 to make bus bodies with a combined investment of around Rs 350 crores in response to an invitation from the Government of Karnataka to set up a factory in Dharwad region with a view to enhance industrial development and employment in Northern Karnataka.
The company provides permanent employment to 1240+ workers, more than 60% of whom belong to Dharwad and Belgaum districts. Majority of the balance workers come from other districts of North Karnataka. Suppliers and vendors of the company have generated additional employment for over 10,000 local people of the area.
The company believes in working in harmony with all stakeholders and has taken several progressive steps over the years towards the welfare of its workforce, their families as well as the neighboring communities. It offers its employees a holistic wage and benefit package benchmarked with industry and region.
With travel and tourism severely curtailed, schools shut and offices closed during and as an aftermath of Covid pandemic, the overall demand for buses reduced by over 80% over the last few years leading to losses and severe financial crises.
The long term wage settlement signed between the company and its worker unions in June 2016 expired in March of 2020. Several rounds of negotiations were held with the unions thereafter and despite best efforts, it unfortunately did not result in a mutually acceptable wage settlement.
As next step, appropriate labour authorities from the Government of Karnataka were duly informed and they initiated reconciliation proceedings and thereafter upon its failure, as per due process, referred this matter to the Industrial Tribunal for adjudication. Along with the referral to the Industrial Tribunal, the Labour Secretary, Government of Karnataka directed the Company to pay an interim relief of INR 6,000 per month pending the decision of the Industrial Tribunal and the workers to maintain industrial harmony, discipline and productivity.
Unfortunately the productivity at the plant has been much lower than the normal levels putting further strain on the company’s financials. During the month of May 2022, the management team communicated the shortfall in production and the challenges it posed to the Union and workers regularly. Further, in good faith, the company paid the interim relief amount of Rs.6,000 per month in addition to the due wages to workers for the month of May. With productivity levels continuing to remain low in the month of June, the Company was unable to pay the interim relief for the month.
Recently, the company was informed by one of the unions that its member workers will not consume food while on duty. The foremost priority of the company is towards the wellbeing of its workforce. As deliberately staying hungry while on duty compromises the health and safety of the workers as well as the plant, workers entering the plant premises are being requested to confirm that they will not refrain from consuming food while working on their daily shifts. Unfortunately, the workers have refused to confirm that they will consume food and instead have chosen to stay out of the factory.
Despite incurring losses consistently over the last few years, the company always ensured timely payment of wages to its workforce. Now on a recovery path, staying market competitive is essential for the long term survival and growth of the company and its workforce. Accordingly, the company expects its workforce to respect and abide by the Labour Secretary’s direction to ensure harmony, discipline and productivity to avail the interim relief while we await the decision of the tribunal.
In parallel, consistent efforts continued to achieve an amicable wage settlement and this resulted in a long term wage agreement being signed in June 2022 with one of the employee unions. As per the terms of this productivity linked wage agreement effective from April 2021, the average salary of a worker will progressively increase by Rs.16,000 to become Rs.48,000 per month over four years.
Tata Marcopolo Motors Ltd. remains committed to fostering relationships based on trust, collaboration, discipline and mutual respect with its workforce. In addition to the long term settlement signed with one of the Unions in Dharwad plant, in March 2022, the company had signed a long term settlement with the workers union at its Lucknow plant, paving the way for focus on growth and productivity. The company continues to extend its fullest cooperation to appropriate government agencies and unions to support the Dharwad plant’s competitiveness, long-term growth and sustainability.