Balco - The Disinvestment Story

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Themes: Corporate Restructuring
Period : 2001
Organization : BALCO
Pub Date : 2002
Countries : India
Industry : Metals & Mining

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Case Code : BECG004
Case Length : 10 Pages
Price: Rs. 300;

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All's (Not) Well That Ends Well

The workers were not happy with the agreement and dubbed it as 'a face saving' exercise. 'We could have very easily bargained for a better deal if only we had negotiated earlier. Our bargaining powers got considerably reduced when the management realized that we were cracking under pressure' the workers said. The union leaders had to give to the pressure, which increased when Jogi who had so long vowed to revoke the deal, backed out. This was followed by the Supreme Court order asking the workers to consider two months wages as advance.

The workers felt that all the twenty-five points of the agreement were not exactly in their favor. The management assured that there would be no retrenchments, not just for one year, as stated earlier, but till retirement.

They would also continue to enjoy all the existing benefits that were due to them as public sector employees. The wage agreements would be discussed with the representative unions in three months time and a new package of wages could then be introduced.

However, the management turned down the worker's demand to have the agreement counter guaranteed by the GoI. The management was also free to make transfers. Many workers felt that 2002 would see mass transfers of all the 'troublesome' workers who spearheaded the strike.

Trade unions affiliated to the Left Parties expressed their strong displeasure at the manner in which the deal was rushed through. They blamed Jogi for the workers plight and said that had he kept up his support, they would not have ended their strike.

Said Harinath Singh (Singh), General Secretary, AITUC, "Mr. Jogi promised us his full backing, but ditched us at the eleventh hour. He went back on his words, perhaps due to orders from his party high command. This is highly unethical. The INTUC taking a cue from Mr. Jogi suddenly developed cold feet and more or less forced the issue." Mr. Jogi's suddenly withdrawing support to the striking workers had raised many eyebrows.

Some of the workers did not see it just as political opportunism but a definite indication that some underhand deal had taken place. "We cannot say for certain about who took money to clear the disinvestment deal in the first place. But we are certain that Mr. Jogi's hands are not clean now. A deal has definitely been struck between the Chattisgarh Chief Minister and Sterlite Industries. Otherwise, there is no reason for him to withdraw his support to the striking workers overnight," the workers alleged.

Singh said that the fight against the agreement would continue if there was any injustice. He commented, "The first thing on our agenda right now is to get the Central Government to provide a counter guarantee to the agreement that we had signed with the management. Although the new owners have said that there is no question of involving the Central Government now, we will still try our best." As per the union's demand, GoI should provide a guarantee of Rs. 25 lakhs per employee if the management went back on its commitment not to tamper with their service conditions or retrench them.

The AITUC General Secretary also said, "The management also promised not to transfer any employee for one year. But after that, there were free to do as they wanted. This was a dangerous move." Commenting on the transfer, he further said, "As regards transfer, the only place that the workers of Balco at korba can be transferred to is Bidanbagh in West Bengal. They cannot transfer any worker of Balco to any of their other group companies. If they do, then we won't keep quiet. Lets see if they are vindictive or not."

A clear warning for the Balco Management that ALL'S (NOT) WELL THAT ENDS WELL.