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Et news

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  • 1. SUBMITTED BY: NEHA SINGLA MBA 2C
  • 2.  At present, the law applies only to organisations employing more than 20 workers.  A proposal by the employees organisation at the conference, which was backed by state governments, suggests there should be parity in terms of wage rates, holidays, hours of work, social security benefits and other conditions of service.  If contract labour law implemented, they will be a big change in the working conditions of the 130 million contract workers, many of them underpaid and over-worked.  The current rules say that a contract worker must be paid at least the minimum wage prescribed for the government for a particular work, but they do not prescribe same pay for same work across an organisation.
  • 3.  Under the proposed law employers would have to lift the wages and EMPLOYERS have refused to back the government’s proposal to extend same wages, leave and social security benefits  The government could go ahead with changes in the contract labour law such as give facilities of five days week, forty days leave or LTC to contract workers and one also has to look at their education and skill levels.  For better implementation, the employers’ organisations sought to emphasise the difference in the two categories of workers.  They argued that regular workers with better and multiple skills deserved to get more than the low-skill contract labour.  If the contract workers are not well educated and have low skills, do not employ them at all and lower the quality of industrial production
  • 4.  PRIME minister said that certain labour laws may be contributing to the rigidities in the labour market and hurting employment growth which indicating that the government was aware of the need for a reform in rules that dictate labour markets.  There may be a need to rethink the nature of laws to draw more workers into the organised sector  The conference, a tripartite meet of the government, employer and employee organisations held to resolve workforce related issues.  PM said “Is it possible that our best intentions for labour are not actually met by laws that sound progressive on paper but end up hurting the very workers they are meant to protect.”  A 2004-05 survey showed 26 million employed in organised sector against 433 million in the unorganised sector where wages are low and work conditions bad. The organised sector employment rose to 27.5 million by 2008.
  • 5.  Rigid labour laws are largely the reason companies opt for capital intensive manufacturing as opposed to labour intensive ones and hire contract labour instead of permanent workers.  The number of contract workers, according to government estimates, has increased from about one million in 2006-07 to 1.39 million in 2009-10.  The labour ministry has already floated a proposal to change the law making it mandatory for all employers to treat contract labour on a par with permanent employees ,  At the last meet, employees and employers groups were unable to bury their differences over the changes to be made in the contract labour act.  The government has total sympathy towards corporates and behaves as if trade unions do not have any role to play in the discussion.  The government is working on a National Employment Policy to accelerate employment growth, particularly in the organized sector.  Responding to the issue of rising prices, the PM assured that the government was making serious efforts to moderate the inflation rates.
  • 6.  PROCTER & Gamble, makers of Maggi noodles and Ariel detergent, is planning to build a manufacturing plant in Chennai, which will be the world’s largest consumer product company’s hub for south India.  A company official said the plant will come up either at Cheyyar or Mahindra World City.  They will manufacture liquid detergent and will become an export hub to neighboring markets.  This will make P&G the first company to manufacture liquid detergent in the country where the 12,000-crore detergent market is equally split between washing powder and detergent bars.  P& has only 15% share compared to Hindustan Unilever’s 37% in the detergent market, is desperately trying to catch up. The company that entered the mass segment with Tide Naturals last year is set to become the first player in the niche liquid detergent.
  • 7.  During his visit to India two years ago, the global CEO of P&G, said the company is looking at setting up 19 manufacturing facilities globally including India  P&G is looking to tap bottom and mid segment of the market for growth.  The company recently said that it is looking at tripling its revenues in India within the next three to four years.  P&G in India has a combined . 4,500-crore turnover between its three subsidiaries — Procter & Gamble Health & Hygiene, Procter & Gamble Home Products and Gillette India.  It has seen 30% year on year growth in India.  Its focus categories include household care, healthcare and beauty & grooming.
  • 8.  Mahindra & Mahindra (M&M) will pay 2,105 crore ($463 million) for a controlling stake in ailing South Korean SUV maker Ssangyong Motor to help widen its product range and boost sales in the overseas market.  It would acquire 70% in Ssangyong and expects to complete the acquisition by March 2011. Out of the total acquisition cost of $463 million, Mahindra will subscribe to new equity shares worth $378 million ( 1,723 cr) while the rest will comprise corporate bonds. M&M was chosen as the preferred bidder in August this year.  M&M intends to introduce three new Ssangyong models in India over the next three-four years to help revive sales of the Korean SUV maker.  The deal also gives M&M access to advanced engines and markets such as Russia, Middle East and Europe.
  • 9.  The M&M scrip declined 0.87% to close at 759.7 and Ssangyong also dropped 4.5% to 9,550 won.  M&M has already deposited 10% of the final purchasing price as per the definitive agreement, with the balance to be deposited three days prior to SYMC’s stakeholder meeting.  Out of total 2,105 crore, M&M will subscribe to new equity shares worth 1,723 crore while rest will comprise corporate bonds .  Ssangyong will continue to function as an independent entity, with current management holding the fort Labour union of SYMC, M&M & SYMC have also signed a tripartite agreement
  • 10. THANK YOU