Friday,Aug 26,2011
By Debjit Chakraborty, Agency DNA
Mumbai: Workers unions of Coal India Ltd have demanded a 100% wage hike, but if comments by chairman and managing director N C Jha are anything to go by, it is difficult for the company to match even the last hike.
“Last time, we had agreed (to hike salaries) by about 24%. This time, whether even that is a possibility or not will be looked into,” Jha said.
Non-executive employees comprise close to 80% of the company’s staff strength, and wages and salaries make up over 40% of its total costs.
Coal India revises non-executive staff wages every five years, while those of executives are done every 10 years.
The last wage hike for non-executive employees came into effect July 1, 2006, and the National Coal Wage Agreement expired on June 30.
In the wage negotiation committee’s first meeting held over the weekend, the company’s five trade unions have put forth a demand to raise wages by 100-500%.
The demand shook investor sentiment, with shares of Coal India falling 3.5% intraday before recovering and closing at `374.35, marginally higher than the previous close.
The stock has lost nearly 6.5% since Monday, losing its recently-gained top position in market capitalisation. “Such demands are only wish for the moon... It isn’t simply possible to give 100% increase,” said Jha.
“Investors should understand that when negotiation comes, somebody demands very high, and when we negotiate it comes down to a comfortable position where both the parties agree and the company also doesn’t get adversely affected. Investors should not be panicky on this,” he said.
The negotiation committee will again meet on September 22-23. “We have to see how much (of the demands) can be absorbed and does it create any anomaly with the pay structure,” the chairman said. NewsWire18
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By Debjit Chakraborty, Agency DNA
Mumbai: Workers unions of Coal India Ltd have demanded a 100% wage hike, but if comments by chairman and managing director N C Jha are anything to go by, it is difficult for the company to match even the last hike.
“Last time, we had agreed (to hike salaries) by about 24%. This time, whether even that is a possibility or not will be looked into,” Jha said.
Non-executive employees comprise close to 80% of the company’s staff strength, and wages and salaries make up over 40% of its total costs.
Coal India revises non-executive staff wages every five years, while those of executives are done every 10 years.
The last wage hike for non-executive employees came into effect July 1, 2006, and the National Coal Wage Agreement expired on June 30.
In the wage negotiation committee’s first meeting held over the weekend, the company’s five trade unions have put forth a demand to raise wages by 100-500%.
The demand shook investor sentiment, with shares of Coal India falling 3.5% intraday before recovering and closing at `374.35, marginally higher than the previous close.
The stock has lost nearly 6.5% since Monday, losing its recently-gained top position in market capitalisation. “Such demands are only wish for the moon... It isn’t simply possible to give 100% increase,” said Jha.
“Investors should understand that when negotiation comes, somebody demands very high, and when we negotiate it comes down to a comfortable position where both the parties agree and the company also doesn’t get adversely affected. Investors should not be panicky on this,” he said.
The negotiation committee will again meet on September 22-23. “We have to see how much (of the demands) can be absorbed and does it create any anomaly with the pay structure,” the chairman said. NewsWire18
More related articles
Coal India Should Shun Foreign Acquisitions, Investor Says
Buy Coal India for the long term: Ashwani Gujral
CIL wage costs may rise 19pct this fiscal - JP Morgan
CIL to liquidate 25 million tonne inventory - Mr NC Jha
Coal India overtakes Reliance Industries as most valuable company
Coal India Q1 profit up 64 pct, faces competition for resources
Coal Regulatory Authority proposed in Indian
Ministry of Coal, Status of Coal Blocks
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