Asst.manager -hr
Ramesh Enni
Hr At A Popular Telugu Daily News Paper
Asso.prof.(commerce & Management) Pg
Ashutosh Thakre
Hr Professional
Hr / Ir
+3 Others

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If we reduce working hours of employees who wre working in factory from 8 hours to 5 hours, what kind of advantages and disadvantages are there for both employee and employer regarding to monetary benefits like bonus, pf, gratuty,increments etc...?
From India, Hyderabad
Well, this is a debatable question and i strongly believe less working hours yields more productive work and makes your employee creative at finding ways to accomplish the tasks in a smarter way. The PF,Gratuity and bonuses will not be affected but the employers can definitely save on Electricity,House keeping staff,tea coffee consumption (If given free ;) ) and yes you can contribute to the environment by saving that extra 4 hours of employee presence in the office and also tot he traffic woes. though these aspects look silly but my analysis shows they do make huge difference tot he employer in saving the costs and yet get highest price. Its a thought that should be practiced. Go for it Buddy and it will give you good profits.
From India, Chennai
Hi Ramesh, Employees wont work if you reduce monetary benefits as we know at the end Money matters to all,Considering the present situation of India where inflation is at rise and people are more frustrated with escalating expenses i don't think cutting on monetary benefits of employees is a good idea. PF and Gratuity amount are subjected to the Indian Laws. As per law 24%(12% by each by employee and employer) of the basic salary is contributed towards PF so you can't reduce this amount.The only option remains is to cut the salary which is not advisable as it will affect your production.few employees do have second jobs for which they need time so you can reduce their salary and let them work for 5 hours and rest of the employees for 8 hours.
From India, Chennai
Pf, gratuity and bonus is not calculating on hours of working, so that will not effect for Statutory compliances.
1.if employees are working on daily wage base then it will effect to PF
2. for garrulity no of years of continuous service is required
3. increment is based on their performance.

From India, Mumbai
Dear Ramesh,
If you are reducing the monetory benefits or terms as you are reducing the timing of the company, how many of them will work for you. Would it not be good for them to just switch jobs, as reducing the monetory part along with the working hours will be taken as the company is not performing and people will look at abonding the ship... Therefore if you really want to reduce the working hours, do so without deducting the salaries and you will actually see the production rising and costs coming down.
Ashutosh Thakre

From India, Mumbai
This looks more attractive to female employees. Definitely they might compromise on salaries too. Though you cannot reduce the existing scale,
by offering less working hours, next appraisal can be negotiated. Definitely employers can save on Electricity, Water, House keeping staff, canteen, Telephone expenses. Interested Employees can also take up part time jobs.
At the same time employees exit rate can also be high, as they get more time to find better job. Still 5 working hours attracts
new comers.

From India, Bangalore
I do agree with Zapking. Employees will definitely be smart enough to finish the task. As for the compensation, per hour rate must increase since employee work fast.
From Philippines, Cebu
Dear Ramesh,
You have not revealed for what purpose you are thinking of reducing the working hours from 8 to 5. Are they working in a hazardous/ arduous work environment rendering the workers become tired soon and their productivity reduces from optimum levels ? Or just because order book position is inadequate so as to not to employ them for the full 8 hrs. shift. Or any other reasons like power cut, raw material shortage or stagnation of finished goods due to lukewarm market or most of them of old age etc.
If your thinking is aimed at only cost cutting then it would be appropriate that you should look at your Cost Benefit Analysis and other factors like marginal costing/standard costing, idle manpower cost etc.
As others pointed out any reduction/abolition of benefits always going to be counter productive, so you have to think of pros and cons of implementing your decisions before hand.

From India, Bangalore
Dear friends , I think NOTICE OF CHANGE underFactories Act has to submitted to DISH.Director Industrial Safety & Health for approval Only aftertheeir APPROVAL ONE CAN COMPLY REGRDS
From India, Mumbai
Dear Mr.Ramesh, no need to discuss more it is definitely not good because it reduces machine production by 50%. it may be work out for non production offices only.
From India, Bangalore

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