Honda Labour Issue Finally Resolved

In 2005, an agitation at the HMSI (Honda Motorcycle and Scooters India) plant in Gurgao created huge ripples all across the nation when the company workers were mercilessly beaten up in a lathi charge by the police, everything under the management’s eyes. Similar situation arrived a few days back when the company workers refused to work citing numerous demands and grievences.

As many as 40 permanent and 100 contractual workers were not working which created a halt of the third assembly line in the Gurgaon plant. Honda lost immense money to the tunes of 250-300 crores, production was down by more than 50 percent and as a result waiting period for their 2 wheelers increased manifold, people started canceling their bookings and going for other company products after waiting for eternity and the workers were just not ready to show some respite. Rumors were ripe that if the problem persisted, Honda might shut its Indian operations or shift to a different state. HMSI even petitioned the Punjab and Haryana High court for relief.

The last time the issue was settled when a long term wage settlement was signed by both the parties in September 2006 which was valid for three years. Those 3 years expired on 31 July this year. The labor was hard stuck on formation of a new wage structure, better facilities and good behavior from the management while the company cited the demands as unreasonable. HMSI said that its backlog has touched 1.4 lakh units due to this agitation. The company also stopped taking fresh orders for a few of its models from the dealers and the production of spare part vendors was cut to half because of the non working of the majority of its workers.

However, on 27th October HMSI issued a statement announcing the settlement of the ongoing dispute over wages with the labors. According to the company the ongoing negotiations with the labor union progressed well. Another 3 year long term wage settlement (LTS) was signed on 28th October by the management and the workers union in the presence of the Labor Department. The company agreed to start a performance reward scheme and other benefits for all the workers which would benefit them in many ways. Company also stated the incident as unfortunate and feels that after the resolution of the issue, everything would be back to normal and things would go full gear to achieve the production targets set for the current financial year.

On Wednesday 28th October the newly installed third assembly line was resumed to boost production to an annual figure of 15 lakh per annum and to clear the waiting period of the customers. The third assembly line would produce around 500 units daily initially and soon HMSI would take it to 1000 units per day within some weeks. Recently HMSI also launched an upgraded 110cc Aviator as well. All those who have been waiting for your booked Hondas, the wait might just not be much long.

– Saad Khan

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