Calcutta, June 2: Hindustan Motors, the makers of the Ambassador, has sought the state government’s help to hive off its forge and foundry unit at the Uttarpara plant, to partially pay wage arrears to 2,600 employees.
The state government, however, was sceptical about the company’s attempts to clear the arrears.
HM today disbursed half-a-month’s salary averaging at around Rs 7,000 as partial advance payment of the arrears to its employees at the plant. The company has utilised the proceeds accumulated through the sale of scraps to make the payment after declaring suspension of work since May 24.
Bengal labour minister Purnendu Bose held a bipartite meeting with company officials on Thursday and directed the company to make a “partial advance payment” of the wage arrears, which have run up to almost Rs 11.9 crore.
“The company on request of the labour minister — post convening of talks held on May 29 — today released half month wages as advance payment. The company continues to be faced with a very stark situation and funds accrued out of the sale of scrap were used towards disbursing the advance wages,” an HM spokesperson said in a statement.
“The company has sought the state government’s help in enabling the closure on the forge and foundry divestment which requires some approvals from a consortium of lenders which in turn will enable it to clear the backlog on overdue wages,” said the statement. According to the company, the forge and foundry units have been making a cash loss of Rs 1.5 crore every month.
HM will again meet Bose tomorrow. The state has sought an action plan from the company to pay off the arrears. However, the labour minister today remained skeptical about HM’s attempts to clear the outstanding liabilities.
“The company has today cleared some outstanding wages. It is a somewhat positive development. But, the issue of Hindustan Motors is regarding its financial position and its outstanding liabilities. We have received information on the company’s plan regarding the forge and foundry unit. I will have to discuss the matter with the finance minister,” Bose told The Telegraph.