Notwithstanding the completion of the targets, theoretically speaking, no worker can sleep while on night duty. If he has completed work assigned to him then he should assist someone else or he should be given another task. By the way, what the supervisor or the production manager was doing when the worker slept? Why some alternate work was not assigned to him?
Anyway, this is the internal matter of your company. We the members of this forum are outsiders and cannot provide the solution. This is because we do not know how far the labour union is active and what is the mindset of the union leader. Is he a troublemaker? Please think it over and choose the right option.
The Employer MUST be and Remain Vigilant and STOP such Act. Often, Few CaughtSleeping on Duty take a Defence saying that s/he was Feeling Unwell and in such situation, the Employer/Duty Supervisor Must arrange for a Medical Examination Care of such an Individual.
Appeasement Policy/Stand Never paid. Make People Aware through regular Workshop short Sessions
However based on few seen cases,at night after certain hours of work the production is stopped for the specific rest period to avoid accidents incidents etc,where employees are found in resting area instead of work place or production floor.
Can workers sleep in duty hours? The affirmative answer is 'No'. Sleeping during duty hours is considered as miscondut.
What is the duration of sleeping per shift? This should not be be considered as sleeping rather rest, because they finished their quota of job fixed for that shift and nothing there to perform. You can not deduct anything as they have their attendance and gave the fixed production. This is a serious situation as you have not done proper time study/motion study before fixing prodyuction target with Union.
The only remedy is to take-up the matter with the union to stop this indiscpline. Moblise the union to for engagement of workers for extra production with incentive would be a better solution. But your action for the reason would cause unrest.