Honda management puts pay hike of about 1,900 employees on hold citing dip in revenue, slow demand for two-wheelers

  • The company had last hiked the salary in August 2015 in which the permanent staff got a salary hike of Rs 23,300 each over a period of three years

  • HMSI had suspended operations at the plant from the first week of November as workers protested for over a week against the retrenchmen

  • In August this year, it was reported that HMSI had laid off about 700 contract workers at its Manesar manufacturing plant due to a production cut

After suspending operations due to workers' strike last month, Honda Motorcycle & Scooter India (HMSI) reportedly postponed the payment revision of the company's about 1,900 permanent employees to next year, said a news report.

About 1,900 permanent workers at HMSI's Manesar plant will not get pay hike until next year mainly due to falling revenue and slow demand for two-wheelers, said a report in The Indian Express.

The company had last hiked the salary in August 2015 in which the permanent staff got a salary hike of Rs 23,300 each over a period of three years and the next revision was to happen in August 2018. But the company management reportedly postponed the matter due to slowing demand for two-wheeler and higher marketing expenses, said the report quoting employees union.

 Honda management puts pay hike of about 1,900 employees on hold citing dip in revenue, slow demand for two-wheelers

Representational image. News18

“So far since August 2018, the discussions on salary hike were on. However, the company has now indicated that it won’t happen until the second half of next year when the demand is expected to improve,” the report said quoting a union member.

Last month, HMSI had said it had commenced operations at its Manesar plant with permanent employees joining the work though the sacked contractual employees continued with their protest at the site.

The Japanese two-wheeler major had suspended operations at the plant from the first week of November as workers protested for over a week against the retrenchment of their 200 contractual colleagues.

The stand-off at the facility, which employs around 1,900 permanent workers and 2,500 contract workers, began on 5 November morning when Honda's management did not allow some of the contractual workers to go inside the plant.

Early last month, production at HMSI's Manesar plant had been suspended temporarily after about 1,500 contract workers went on a strike following the sacking of workers.

The contract workers were on protest at HMSI's Manesar plant from 5 November after the company sacked about 650 contract workers over a period of 10 days and the employees demanded either reinstatement or compensation of Rs 1 lakh per worker for each year of service.

In August this year, it was reported that HMSI had laid off about 700 contract workers at its Manesar manufacturing plant due to a production cut.

The persistent slump in two-wheeler sales and a pile-up of inventories with the dealers led to a production cut since December last year. This situation led to laying off of workers.

A few workers who lost the job at HMSI had been working with the two-wheeler manufacturer for about 10 years.

In October, HMSI had reported a marginal decline in total sales at 5,17,808 units. The company had sold 5,21,170 units in the same month last year, reported PTI.

With PTI inputs

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Updated Date: Dec 26, 2019 17:29:58 IST