If yours is factory then do you have standing orders approved by the labour department? Your case needs to be looked from two angles. One is legal and another from management science.
If standing orders do not permit consumption of alcohol in the company premises then Factory Act does not permit any employee to work more than nine hours per day. Therefore, it is employees and employers both have transgressed the law. It is better if they do trade-off and move on.
If employer thinks that he has "employed" the employees therefore he enjoys the whip hand, then let him be ready for backlash as well. Tell your Director to tone down his haughtiness. All that employees are giving is resignation. Suppose they go a step further and approach the labour department for forcibly making to work extra and asking for forcible resignation, will it not land your company in soup? Please tell the Director that in general Labour Officers favour employees and not employers.
To meet the customer's commitment, if employees are required to put up 16 hours a day then something is wrong in the management style of the company. Tell your Director to fix this flaw first. Now do not tell me that "this is what happens in our industry". There is general tendency to hide one's inefficiency with this lame excuse.
His leadership lies in meeting the customer's deadline smoothly or without gasping for breathe. He should not focus his energy in taking on employees.
Tell your employer that today he no longer enjoys opaque work culture of 20th century. With social media so active, do you think that these people will not create in negative publicity in the job market? In huff, he may sack people but tomorrow he has to attract the right persons for eight job. Will he be able to do that?
Vis-a-vis you line "employees had drinks around 10.00 p.m. and came to the factory only after the customer returned after dinner", does this mean the employees went out to have drinks OR is Dinesh's presumption correct [that they had drinks within the factory premises]?
And is working for >16 hrs/day for a week the normal practice in your factory OR is it due to some exigency or delivery deadline to be met? IF the later, then your Director ought to adopt a 'give & take' policy. I too have worked under such situations now & then earlier in my career & I know how it's handled from the Top.
Based on what you mentioned--that the concerned employees are ready to resign--looks like the pressure must have come from the customer. That's when the Director needs to act as the TACTICAL BUFFER between the customer [who can't be ignored] & the employees [who can't be just done away with without thinking of long-term consequences].
And since the employees have offered to resign, it does seem that they have realized their mistake & wish to correct.
In this context, I would draw your attention to a small story [not sure if it's true or not, but it does convey HOW any Top Honcho ought to handle such a situation] about Gautam Adani. When he caught an employee of making a big blunder that could have costed the Company a lot, he refused to accept the employee's resignation on THIS ground: You made a mistake, didn't hesitate to correct it & have also learnt your lesson. Now you will never repeat such a mistake. So WHY should I allow someone else to benefit from this lesson? I would rather benefit from it.
However, IF this is the normal practice, then Dinesh is absolutely right in saying "Tell your Director to fix this flaw first".
Dismissal,punishment etc are not applicable here.
Counselling and advice is what is necessary.
I presume that they did not drink within factory premises.
The staff had a pressurised work schedule to meet company commitment and wanted to let steam off after meeting schedules as per company commitment.
When they offered resignation enmasse the company wants to take disciplinary action.
Offence is not all that serious in one way,but going home driving after consuming liqour is unacceptable and can lead to serious consequences.
Making them work beyond normal working hours is equally a violation of law.
Two wrongs do not make a right.Tell you director to be sensible and treat it as one of the things which do happen.
If customer had made a complaint deal with it diplomatically but employees should not a pawn.
I write this considering that employees drank outside the factory and came back only because customer had come back and work was completed prior to "happy hours".
Director needs to handle his human resources more carefully and with care.They are not disposable commodity.
If Managerial People then Standing Orders do not Apply.
Every day 16 Hrs Job under the garb of completion of task is how Legal, Fair and Proper.
Had this been done by a set of workers under same situation, whether we would have thought same or otherwise?
Here whether we need anything of very serious nature or can the matter be finished by calling them in person and getting their apology. ?