MAC: Mines and Communities

Balco staff 'coerced' into VRS'

Published by MAC on 2007-01-25

'Balco staff 'coerced' into VRS'

Akshaya Mukul, Times of India

25th January 2007

NEW DELHI: Six years after profit-making Balco was privatised, a report of an institute affiliated to the labour ministry, for the first time admits that the step has had an overall adverse impact on workers.

Employees were "coerced" into opting for voluntary retirement scheme (VRS) which followed the deferred payment system and those who stayed back continue to face harassment. The V V Giri National Labour Institute, a labour ministry outfit, interviewed 280 VRS beneficiaries. Its report says most of the labour-related provisions in the shareholders agreement between the government and Sterlite have been flouted.

The new management even lagged behind in its social responsibility. The report says there has been "visible decline in the school enrolment rates", so much so, that the junior school has been closed and "now the company is using the junior school building as a warehouse/godown". Even in the main school, which is still running, "a godown has been built by the company recently". Coming back to VRS, the report says various modes of "coercion" were used. For instance, a large number of employees in the New Delhi office and Bidhanbag unit were transferred to Korba and forced to accept voluntary retirement.

"When employees at the New Delhi office protested against their transfer to Korba, their salaries and allowances were stopped and remained unpaid for more than seven months," the report says. One strategy adopted to enforce VRS was to "humiliate workers by directly attacking their self-esteem and questioning their loyalty to the firm".

The report, based on interviews, gives various accounts of how workers were "humiliated" by the new management and in certain cases, VRS was "forced" without their consent. As for the reasons of opting for VRS, the report says 35.71% opted due to "direct or indirect pressures from the management", 21% due to peer pressure, 19% due to "panic and tension" they had to undergo after their redeployment and transfer and 8% due to ill-health.

For those who opted for VRS, payment was made in five instalments with a gap of six months between each payment. Out of 1,302 employees who were granted VRS, 1,281 were paid under deferred terms. Even after accepting VRS, the company retained Rs 25,000 to Rs 50,000 from the payments admissible to voluntarily retired employees.

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