Canteen Price Fixing in Factories: Who Decides and What Role Do Trade Unions Play?

Hi all, I need clarification about "canteen price fixing in a factory."

Who will fix the prices of the canteen in a factory with an elected body?

a) Canteen Managing Committee.
b) Trade Union.
c) Management.

What is the role of trade unions in canteen-related issues?

The "Canteen Managing Committee" (CMC) is the right body that can fix the prices of items or meals sold in the staff canteen. This committee can have a representative of the management, generally from the admin department. Additionally, there can be a representative from the labor union as well.

In fact, the labor union does not have a role in the CMC as such. However, if they are given representation, it helps them maintain good relations. Many times, labor unions complain about the poor quality of the food. Therefore, representation from the labor union helps minimize their complaints.

Thanks,

Dinesh Divekar

There are at least three methods being followed. The obligation on the part of management is to provide a canteen facility, whereas how it should be run is left to the management's option.

Run the canteen on its own

1. Provide everything from A to Z, including staff, equipment, provisions, and implement menus. It should not be a profit center, charge nominal prices for items, or even be fully free but remain as a welfare measure. This is suitable for large units or factories.

Outsource operations

2. Provide infrastructure and equipment but outsource operations. Finalize menus, fix rates, ensure quality and quantity of items, and provide subsidies or pay bills at fixed rates as per quotes.

Managed by employees' union

3. Let the canteen be managed fully by the employees' union or their welfare society to be run on a No Profit, No Loss basis. Infrastructure is to be fully provided by the management.

Fully outsourced

4. Engage catering contractors to supply items on fixed menus finalized in consultation with employees. Bills are paid by the management.

Nowadays, most IT/ITeS run cafeteria-type facilities providing tea/coffee, light snacks, etc., in their automated vending machines, meeting the costs and offloading food and fruit supplies.

As long as management provides a decent canteen facility, unions will have no issues. Also, go through this link - https://www.citehr.com/106103-help-m...ad.html#416502

Dear Subamage12, I would like to give an answer to your specific question with due respect to our two learned senior members, as follows:

Your question pertains to the Canteen in the Factory

Your question is: Who will fix the prices of the canteen items? Is it a) Canteen Managing Committee, b) Trade Union, or c) Management?

You are advised to read the rules framed by your State Government under section 46 of the Factories Act 1948. In some States, as far as I recollect, the prices for food, drinks, and other items shall be charged subject to the approval of the Canteen Managing Committee.

I would like to draw your kind attention to Rule 84 and Rule 85 under the Maharashtra Rules 1963.

Rule 84: Role of the Canteen Managing Committee

(a) The quality and quantity of foodstuffs to be served in the canteen;
(b) The arrangement of the menus;
(c) Times of meals in the canteen; and
(d) Any other matter pertaining to the canteen as may be directed by the Committee.

Rule 85: Foodstuffs to be served and prices to be charged

(1) The Chief Inspector may, by an order in writing, direct the manager to provide in the canteen any item of foodstuff if he is satisfied that such item is in general demand. Such order shall specify the size of each portion to be served, the number of portions which shall be available, and the frequency of serving the particular item per week. Such order shall also specify the time-limit within which the order shall be complied with.

(2) Food, drink, and other items served in the canteen shall be sold on a non-profit basis. In computing the charges to be made for such food, drink, or other items, the following items shall not be taken into consideration:

(a) The rent for the land and building;
(b) The depreciation and maintenance charges of the building and equipment provided for the canteen;
(c) The cost of purchase, repairs, and replacement of equipment including furniture, crockery, cutlery, and utensils;
(d) The water charges and other charges incurred for lighting and ventilation; and
(e) The interest on the amounts spent on the provision and maintenance of furniture and equipment provided for the canteen.

Provided that where the canteen is managed by a cooperative society registered or deemed to be registered under the Maharashtra Cooperative Societies Act, 1960, such society may include in the charges to be made for any such food, drink, or other items served, a profit up to 5 percent of its working capital employed in running the canteen.

There is no role of the union. There is a representation of the workers in the Canteen Managing Committee, and you cannot ignore the union's existence while constituting the Canteen Managing Committee.

Hope you got the right answer here.

Canteen Price Fixation and Management

Referring to your query:

Price fixation and the finalization of the menu on all working days, whether it involves vegetarian or non-vegetarian food, and determining how many days chicken curry, fish, or egg is to be served are day-to-day matters in a factory canteen. These decisions are to be made by the CMC or Canteen Committee.

In the canteen committee, both management's and workers' participation shall be ensured. Workers should be members of a registered trade union that has a majority in membership.

The trade union does not have a direct role in canteen management, but they can create challenges or headaches for the management. Therefore, select one member from the trade union (who should not be an outsider) to be part of the canteen committee.

Karnataka Factory Rules on Canteen Prices

Presuming that you are operating in Karnataka, the relevant extract of the Karnataka Factory Rules is given below:

96. Prices to be charged in canteen

(1) Food, drink, and other items served in the canteen shall be sold on a non-profit basis, and the prices charged shall be subject to the approval of the Canteen Managing Committee. Provided that if the management bears the cost of wages of canteen staff, buildings, water, lighting, fuel, and insurance, it shall not be incumbent on them to run the canteen at any further loss to themselves.

(2) Items served in the canteen and their prices shall be conspicuously displayed in the canteen.

(3) In computing the prices referred to in sub-rule (1), the following items of expenditure shall not be taken into consideration but will be borne by the Occupier:
(a) the rent for the land and building;
(b) the depreciation and maintenance charges of the building and equipment provided for the canteen;
(c) the cost of purchase, repairs, and replacement of equipment including furniture, crockery, cutlery, and utensils;
(d) the water charges and expenses for providing lighting and ventilation;
(e) the interest on the amount spent on the provision and maintenance of the building, furniture, and equipment provided for the canteen;
(f) the cost of fuel required for cooking or heating foodstuffs or water; and
(g) the wages of the employees serving in the canteen and the cost of uniform, if any, provided to them.

Canteen Management and Union Involvement

As the approval of the Canteen Management is required, it would be better to introduce the matter in its meeting and try to arrive at a settlement. A viable option is to link the canteen rate with the wage revision process. When the charter of demands of unions is considered, the management shall also raise its counter-demands. In my experience, any attempt to even marginally increase the canteen rates after wage revision will not be acceptable to the unions; hence, this should be included in the wage revision package.

Canteens are a soft target against the management in manufacturing industries, offering tremendous scope for the unions to exploit sentiments against management. Involving the unions in the running of the canteens is a very effective strategy to deal with canteen issues.

Canteen Management Committee Responsibilities

The Canteen Management Committee (CMC) holds the responsibility for maintaining, administrating, and running the canteen under the direction of the company's laid-out policies. This is within the framework of prevailing legislation, rules, and regulations of the Factories Act or any other applicable act for the welfare of the employees.

As per our learned members, various rules and regulations provide essential guidelines. The core management should ensure the formation of the CMC by electing competent members from the departments entrusted with the job and including members from employees, unions, etc.