FICCI panel seeks relief based on Dutch-model wage subsidy

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Published: April 15, 2020 12:01 AM

The letter has urged, mainly for wage subsidy to large employers, on the lines of the Netherlands and Australia .

The letter to FM points out that in the Netherlands, firms can claim a compensation towards wages for three months. The letter to FM points out that in the Netherlands, firms can claim a compensation towards wages for three months.

A group of industry captains of private security, cash logistics and facility management sectors, led by Rituraj Kishore Sinha, Group MD, SIS India, has written to finance minister Nirmala Sitharaman seeking a five-point relief package to protect 10 million minimum wage level jobs of security guards and cleaning personnel. The letter has urged, mainly for wage subsidy to large employers, on the lines of the Netherlands and Australia .

“Our customers are advising us about 3-4 months delay in payments, expecting us to waive the 5 to 8% service charge. They have also advised on reducing staff strength. Industry is estimating a 25- 50% decline in revenues in coming months,” wrote Sinha, who is also chairman of FICCI’s committee on private security, in the letter to FM on the distress faced by these sectors.

Other signatories of the letter are Samir Hosangady (MD, Brink’s India), HR Gaikwad (CMD, BVG India), Anush Raghavan (senior vice-president, CMS), Rajeev Sharma (country MD, G4S Corporate Services India), Aksh Rohatgi (CEO, ISS Facility Services India), Manjit Rajain (chairman, Tenon FM Peregrine Security), Guruprasad (COO India Region, Quess Corp), Oscar Esteban (country head, SIS Prosegur), Raghunandana Tangirala (MD, Updater Services) and Suneel Aiyer (CEO, Writer Safeguard).

The industry has sought wage subsidy for large employers, GST Relief, bank support, classification as ‘priority sector’ for credit facilities, extension of Rs 50 lakh COVID-19 health cover for cleaners, ATM/cash van crew and PF contribution support.

The letter to FM points out that in the Netherlands, firms can claim a compensation towards wages for three months. Other costs for employees like pension premiums, employee insurance premiums and the accrual of holiday allowance are compensated. In Italy, government has extended a series of ‘social shock absorbers’, which include paying upto 80% of an employee’s salary for nine weeks to a maximum of €1,130 net per month. Australia’s $130-billion coronavirus plan gives wage subsidies of $1,500 a fortnight per employee for upto six months, for affected firms.

Sinha says that to maintain the industry at its current employment level, it will be critical that government would protect cleaning, private security, pest control and cash logistics companies having 1,000-plus employees with wage subsidies. The main plea is that 50% of the workforce should be subsidised for the next three months and 25% of the workforce for next six months.

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