Ford, Chennai factory union sign settlement agreement, to complete exit formalities soon | The Financial Express

Ford, Chennai factory union sign settlement agreement, to complete exit formalities soon

The last date of employment for all employees will be September 30, 2022 and company is notifying employees of the next steps and looks forward to completing the exit formalities.

Ford, Chennai factory union sign settlement agreement, to complete exit formalities soon
I thank the team at Ford as well as the Chennai Ford Employees Union for negotiating in good faith and arriving at a settlement outcome that keeps the best interest of employees at heart,” he said

Automobile major Ford India and the Chennai Ford Employees Union (CFEU) on Friday executed a settlement agreement, concluding the negotiations on the severance settlement package. After long-stretched negotiations, the management of Ford and the union had on September 22 arrived at a settlement deal on the severance package for the workers of Chennai plant. Ford had in last September decided to exit India manufacturing and close down its factories in the country.

Balasundaram Radhakrishnan, transformation officer, Ford India, said the severance settlement agreement, signed between Ford and the Chennai Union is an important milestone and a win-win for everyone involved.” I thank the team at Ford as well as the Chennai Ford Employees Union for negotiating in good faith and arriving at a settlement outcome that keeps the best interest of employees at heart,” he said

Also Read: Ford India finalises severance package for Chennai plant workers

The final settlement package, an average equivalent of 140 days of gross wages per completed year of service and additional Rs 1.5 lakh lumpsum per employee, translates to an average of about 5.2 years / 62-month of salary for each employee, from a minimum of 4.1years, that is, 49 months to a maximum of 9.0 years, that is, 108 months thus guaranteeing an adequate financial cushion and time for each employee to chart their future action.

The last date of employment for all employees will be September 30, 2022 and company is notifying employees of the next steps and looks forward to completing the exit formalities.

Keeping the upcoming festival month in mind, the company, as a goodwill measure, has also decided to pay an additional amount equivalent to one month of gross wages as a sign-on benefit for employees who complete the exit process by October 14, 2022. “We thank our employees in advance for their patience and support in the process and remain grateful to the Tamil Nadu government and labor officials for guidance,” Radhakrishnan said.

Since the announcement of business restructuring last September, Ford has continuously made efforts to negotiate a fair and reasonable severance package with the workers’ union, spanning 68 meetings, including meetings with labour authorities and senior government officials.

Ford had rolled out the last vehicle from the export commitments of the final assembly at the Chennai actory on July 20. Ford’s other Indian plant in Sanand was taken over by Tatas, which had triggered unrest among the Chennai plant workers as they had been demanding job guarantee in the event of acquisition by a third party, rather than severance package. However, Ford was not able to find a buyer for the Chennai plant, and started negotiations on the package with the workers since June first week.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.