Hero raises wage hike offer a tad but stand-off continues

Written by Roudra Bhattacharya | New Delhi | Updated: Feb 2 2013, 09:02am hrs
In a bid to break the nearly month-long impasse at its Gurgaon plant, the Hero MotoCorp management has increased the wage hike offer to the workers to around R9,000 from the earlier R7,500, sources said. The offer was made during negotiations that went on till late evening on Thursday in the presence of the Gurgaon deputy labour commissioner. Sources said that another round of talks is due on Saturday and a final picture would emerge only after its conclusion.

The Thursday meeting continued late into the night but ended on a positive note for both parties. The management gave the indication that it is ready to raise the pay increase offer by another R1,000-1,500. More clarity is expected after the Saturday meeting, and the labour officials have advised the union to be patient with the management till it announces the final offer, a person close to the development told FE.

When contacted, a Hero MotoCorp spokesperson said: We are in the process of talks with the members of the union of our Gurgaon plant and the process of conciliation is going on in the presence of the labour department. We would not, therefore, like to comment on any unsubstantiated market speculation on this subject.

However, another source said that it is difficult to conclude at this stage whether the workers would accept the latest offer as it is still significantly below the R14,000-15,000 monthly increase that the Hero MotoCorp Workers Union (HMCWU) is demanding. HMCWU represents the 1,200 permanent workers at Heros Gurgaon plant.

So far both the Hero management and HMCWU have been broadly sticking to their positions, leading to a stalemate in the wage talks for many months. The company has refused to bow to the tactics such as a production slowdown that the workers tried last week in order to persuade the management to agree to its wage demands. That led to a loss of 1,200 scooters in production terms and R6 crore in revenue terms. The stand-off prompted reports of brewing tension at the factory and deployment of police force for security. In fact, the company also alleged that workers had tampered with equipment to slow production.

Hero's Gurgaon plant union leadership is under pressure both from its members and unions outside to achieve at least something close to the wage increase that it has already promised to the workers. Anything less would put them in a difficult position. The management is also taking it as a challenge, especially after the workers resorted to arm-twisting tactics, another source said.

Earlier, on January 16, Hero had offered HMCWU around a R7,500 monthly hike (the average salary today is R46,000 a month), raising it from a previous offer of R6,500. However, the Gurgaon plant workers have demanded double that at least a R15,000 hike, similar to what Maruti Suzuki and Honda Motorcycle and Scooter India recently gave its workers at nearby facilities.

The last offer for an increase in the wage hike offer came in response to a silent protest by workers since January 4 under which they wore black bands and boycotted company-provided snacks, and warned that the Gurgaon plant may be headed for a larger strike if their demands are not addressed.