Renault Nissan India offers 8.33 per cent bonus to employees citing poor sales

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Published: September 19, 2019 5:20:55 AM

In a notice to the union’s general secretary, the alliance major said in spite of the current downtrend and the continued sales degrowth of the company, the alliance company is offering 8.33% statutory bonus for 2018-19 for all the eligible employees, according to the payment of Bonus Act, 1965.

Renault Nissan, India, poor sales, auto sector, auto sector slowdown, industry newsWhen contacted a senior official of the union confirmed the developments and said the management should at least pay the last year’s bonus this time.

Global automotive alliance major Renault Nissan Automotive India (RNAIPL) has decided to pay 8.33% statutory bonus for 2018-19 to its employees at the Chennai factory. This is against the demand of Renault Nissan India Thozhilalar Sangam, its employee representative union, for 20% bonus without ceiling limit and an ex-gratia of Rs 25,000.

In a notice to the union’s general secretary, the alliance major said in spite of the current downtrend and the continued sales degrowth of the company, the alliance company is offering 8.33% statutory bonus for 2018-19 for all the eligible employees, according to the payment of Bonus Act, 1965. The management will disburse the bonus on October 18, 2019, as mentioned, the notice added.

When contacted a senior official of the union confirmed the developments and said the management should at least pay the last year’s bonus this time.

The alliance company further informed the union that the Indian automotive sector was in dire straits and was facing a crisis not seen in the past two decades. Particularly, this company is worst affected due to this crisis and the management is taking several steps to reduce the cost of the company in order to manage this critical situation.

It also further informed the union that the plant was operating at 40% of installed capacity (around 480,000 units per annum) and for this acccounting year, there was also no allocable surplus available for disbursement of bonus. It also highlighted the union that the long-term settlement dated February 20, 2017, has expired on March 31, 2019, and there is no settlement in place for bonus and ex gratia for the financial year 2018-19. In spite of this, the management was pleased to offer 8.33% statutory bonus, the notice said.

When queried, the union official said that the management had paid a total bonus amount of Rs 26,500 (including Rs 2,000 ex gratia) last year. By offering at 8.33%, it almost halved to a level of Rs 12,400. The management at least should retain the level of last year’s. There were around 3,600 employees working at the Alliance plant at Oragadam near here, he added.

According to data of industry body Siam, while the Nissan India’s domestic sale for the period April-August 2019 declined by 51% to 8,070 units, that of Renault India’s sales for the same period decreased by 20% to 26,969 units.

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