Philips India - Labor Problems at Salt Lake
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Details
Themes: HR Problems
Period : 1992-2000
Organization :Philips India Videocon
Pub Date : 2002
Countries : India
Industry : Consumer Goods & Services
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Case Code : HROB004
Case Length : 05 Pages
Price: Rs. 200;
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In March 1999, the Kolkata High Court passed an order restraining any further deals on the sale of the factory. Justice S.K.Sinha held that the transfer price was too low and PIL had to view it from a more practical perspective. The unrelenting PIL filed a petition in the Division bench challenging the trial court’s decision. The company further said that the matter was beyond the trial court's jurisdiction and its interference was unwarranted, as the price had been a negotiated one. The Division bench however did not pass any interim order and PIL moved to the Supreme Court. PIL and Videocon decided to extend their agreement by six months to accommodate the court orders and the worker's agitation. Judgement DayIn December 2000, the Supreme Court finally passed judgement on the controversial Philips case. It was in favour of the PIL. The judgement dismissed the review petition filed by the workers as a last ditch effort. The judge said that though the workers can demand for their rights, they had no say in any of the policy decisions of the company, if their interests were not adversely affected. |
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Following the transfer of ownership, the employment of all workmen of the factory was taken over by Kitchen Appliances with immediate effect. Accordingly, the services of the workmen were to be treated as continuous and not interrupted by the transfer of ownership. The terms and conditions of employment too were not changed.
Kitchen Appliances started functioning from March 2001. This factory had been designated by Videocon as a major centre to meet the requirements of the eastern region market and export to East Asia countries.
The Supreme Court decision seemed to be a typical case of 'all's well that ends well.' Ashok Nambissan, General Counsel, PIL, said, "The decision taken by the Supreme Court reiterates the position which Philips has maintained all along that the transaction will be to the benefit of Philips’ shareholders."
How far the Salt Lake workers agreed with this would perhaps remain unanswered.