Thanks for suggesting practical possibilities...
Please note that
1. Unsuceesful VRS possibility was tried once. We had offered 70% of wages (at current rate of wages) for balance service period of each worker.
We shall try it once again by improving on it. Any suggestion what generally is industry practice for attractive and successful VRS offer?
2. Striking workers are preventing non-striking and new recruits from attending duties making union and workers guilty of unfair labour practices.
3. We have already filed police complaints against few of them... Mainly instigators and leaders managing strike.... for stopping company bus, threatening employees not to attend duties, catching employing alone and threatening of dire consequences if he continues to attend duty and going home of managerial staff in big mob and asking them to not attend duties to support their strike.
We have issued show-cause notices, charge sheeted and conducted enquiries following due procedure of natural justice and few of them have already been terminated. But they believe that the mob and union support shall force us to withdraw their terminations.
4. We have asked labour commissioner to declare strike as illegal since union is guilty of unfair labour practices. But labour commissioner is following due diligence and want to avoid explosive situation. Can labour commissioner do such decision or we need to approach labour court for such a request?
5. We have requested labour commissioner to declare failure of negotiation but he is withholding the decision, may be due to pressure of the powerful union.
Now I wonder in case our dispute eventually lands in labour court, non-terminated workers have to join the duty and union shall fight for their demands in court.
Now I have few questions :
1. You said the decision of court may not go in favour. Under what circumstances this may happen? I believe court has no reason to decide against our favour unless raising living standard workers is constitutional compulsion as mentioned by earlier in previous posts. Please give me reference to this constitutional clause.
2. Can court force us to revise wages even though we are quite above minimum wages? I believe court does not have this jurisdiction and allow us to follow principle of market forces. But a lawyer says that India is socialist country and this is not the way Indian law thinks. Indian law may force us to share profits with workers, if we are making profits, by revising wages by declaring an award.
3. Can court force us to pay wages during strike period? I believe court shall follow principle of 'No work, No pay' as per our appointment letter.
I think I have too may queries above... Shall appreciate your views on suitable VRS scheme as well as possibilities of court verdict as well constitutional need to improve living standard of workers continuously even though they are much above industry standards.

From India, Nashik
It is also funny Indian situation that Unions can call ) / withdraw strikes at their whims and there is no way to punish them for unsjustfied strikes and interrupting manufacturing activity leading to huge losses and business interruption to company.
US legislation has adopted right approach by allowing to appoint replacement workers if they are available at lower wages. In that case, unjustified demands of workers is severely punished. This makes workers think twice before actually starting strike.
The employers should champion for such legislation.

From India, Nashik
Pl.see the extract of observations of SC on 'wages revision matters'-
Supreme Court of India
Officers And Supervisors Of ... vs Chairman And M.D. I.D.P.L. And Ors on 24 July, 2003
Bench: M.B. Shah, Dr. Ar. Lakshmanan
Writ Petition (civil) 122 of 1998
A Constitution Bench of this Court had examined the questions of revision of wages of workmen in Express Newspaper (Private) Ltd and Anr. v. Union of India and Ors.. AIR (1958) SC 578. This Court land down the following principles for fixation of rates of wages :-
(1) that is the fixation of rates of wages which include within its compass the fixation of scales of wages also, the capacity of the industry to pay is one of the essential circumstances to be taken into consideration except in cases of bare subsistence or minimum wage where the employer is bound to pay the same irrespective of such capacity.
(2) that the capacity of the industry to pay is to be considered on an industry-cum-region basis after taking a fair cross section of the industry, and (3) that the proper measure for gauging the capacity of the industry to pay should take into account the elasticity of demand for the product the possibility of tightening up the organization so that the industry could pay higher wages without difficulty and the possibility of increase in the efficiency of the lowest-paid workers resulting in increase in production considered in conjunction with the elasticity of demand for the product-no doubt against the ultimate background that the burden of the increased rate should be such as to drive the employer out of business."
Also attached is the Compendium of SC analysis on minimum wages & wage revision which will assist in understanding the concept of fixation & revision

From India, Bangalore

Attached Files
File Type: pdf SC on wages, wage revision & Industrial Disputes.pdf (1.86 MB, 25 views)

Dear friend,
As you are aware, it's not possible to predict what exactly the verdict of any court going to be in a contentious matter. The status of court notwithstanding, let it be labour court or an Appellate Tribunal or High Court or SC. It's the prerogative of the deciding authority to spell out the verdict. And if it comes after a very long drawn process, nobody is going to compensate the losses sustained since the damage is already done.
As you said "No work, No pay" concept is there but no one can take it for granted. There are instances courts awarded revision with back wages as well as reinstatement after termination also.
We don't know what is the man power and their educational levels.
In your case what could be the causes of termination, if at all you are going to think of this tool seriously. Termination en-mass with no valid reason is a danger. On selective basis ? may be possible if the existing employees not having enough skills and knowledge to suit any advanced tech./machines if and when are introduced.
Just because you wish to engage new/freshers vice of oldies just because you could save wage cost need not be a valid reason to retrench a few or all.
May be you could run the plant for some time with the help of contract labour/temporary workers. What if they also influenced to join the strike.
My earlier mail briefly explains grounds for diff.wages & revision thereof.
I afraid we cannot have the cake and eat it too. If situation warrants you should prepare grounds to secure a verdict for declaring the strike as 'illegal' by which you'll have better grounds to proceed further.

From India, Bangalore
Dear Colleague,
You had not stated all the facts right from the start and coming with undisclosed facts and queries.
Regarding VRS, I believe, the timings are wrong as the matters are heated up. May be at later stage.
Right now , battle has to be fought on legal front. Labour commissioner has no authority to declare strike legal and unjustified but the powers are with the court. Let the matter reach the court and you to use your clout for reference in both for strike and COD.
As rightly stated , the labour court are empowered to award higher wages based onregion- cum industry basis and capacity to pay. But you can always challenge the court judgement in the Apex courts.
In view of violence, threats and intimidation to loyal workers ,staff and replacement workers, in my view, it fit case to hit back by declaring lock out by building up case through proper notices , containing factual events and appeals to resume work. Timing of this you decide but you certainly need to take strong action.
Remember that during the notice period of lockout, resort to suspension of operations . Any lockout followed by illegal and unjustified strike( as declared by the court) is legal and justified.
Vinayak Nagarkar
HR- Consultant

From India, Mumbai
I am sorry that I have to pour the facts as subject evolved with your detailed responses to my queries... which were I felt may not get to start with.
Wow... What a educative responses of Mr.S.Kumar and Mr.Nagarkar. I greatly appreciate and thank. You have given us grounds and legal vision to take forward the negotiation with union .... At negotiation table as well as in court... if it lands in court. Supreme court verdict is self-explanatory.
We shall prepare data on elasticity of our product line (uncertainty in sales volumes and compulsion of introducing new products every year due to continuous changes in pharma industry), our industry standard for spending on wage bill as percentage of sales and unsuitablity of uneducated workers in newly emerged regulated environment of pharma industry.
We had been putting notices asking to attend the duties immediately with copies to authorities. At the same time, we are taking desciplinary actions on union members who are following unfair labour practices by preventing others for attending duties.
I shall keep you posted as situation eveolves.
Thank you very much for your support, Sir... I am obliged.

From India, Nashik
Also give me guide line on industry norms for declaring VRS scheme. What are considerations
- Lump-sum amount to be negotiated with union
- balance service period and it's certain percentage
Or anything else. We shall start working on it to understand whether the financial impact can be absorbed and prepare internally for future actions.

From India, Nashik
Another thing, can we go to court to unregister the union at our unit for following unfair labour practices by preventing running of our production? Currently we are conducting enquiries and terminating employees who have participated in such activities.
From India, Nashik
Dear Colleague,
I don't know whether you mean derecognition of the union in place of deregistration.
If you you have recognized union under the MRTU and PULP Act/Rules, then you can.
In your dynamic and unfolding employee relations, I believe my 45+ years of well- rounded IR experience with Tata, Mahindra and multinational companies in Mumbai can be of great assistance to you. Please feel to contact me on 09819192018 or
Vinayak Nagarkar
HR- Consultant

From India, Mumbai
A pre-caution- pl.chalk out/plan flawless strategies to be adopted for the immediate future & longer w.r.t. order book position, vis-a-vis supply commitments, stocks on hand and with the whole sale distributors, how long you can manage facing imminent lockout/shutting down of plants. Also make out due-diligence whether your other plant(s), if any, could make up the consequent shortfall in production and ensure uninterrupted supply if possible. This is necessary to ensure your competitors shouln't capitalise the situation & usurp.
Then, safe guard your plants, personnel and other assets against foul play/sinister activities by disgruntled forces.
Needless to say this, Prudence would direct, in the emerging situation, what to do and what not to do. It's always not necessary that you should blindly follow legal advices in-toto, you people are facing the uncertainty during this testing time and our observations, suggestions can at best could be counted among various options available at different point of time. All the best.

From India, Bangalore

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