India's Top Carmaker Maruti Fires 500 Workers over Riot

Aug. 16, 2012
'We have identified people who we believe were involved in the violence and we have lost confidence in these workers and they cannot be taken back,' company chairman R.C. Bhargava said.

Maruti Suzuki said on Thursday that more than 500 workers had been sacked after staff rioted at a plant near New Delhi last month in violence that left one manager dead.

"Of the 1,500-odd regular workers, we have issued notices dispensing with their services to 500-odd so far," company chairman R.C. Bhargava said.

During the riot on July 18, workers chased managers with iron rods and car parts, attacking them and torching equipment in unrest triggered by a row between an employee and a supervisor, according to witnesses.

A personnel manager, whose legs were broken, was unable to flee and burned to death in an office area. Nearly 100 other supervisors were injured in unrest that shocked India's corporate sector.

Bhargava said that production, which was halted at the Manesar plant after the riot, would be partially re-started on August 21 with 200 anti-riot police on rolling shifts inside the factory.

"We have identified people who we believe were involved in the violence and we have lost confidence in these workers and they cannot be taken back," he said.

"We intend to start step by step. We need to see how the production goes, what the workers and managers (do) and how the whole thing builds up," he added.

"We believe these measures will create a safe environment and so we have decided to lift the lockout."

Among the security measures announced on Thursday was a private force of 100 ex-military guards, and protection for returning workers both at their homes and as they travel to work.

Bhargava said the heavy security would provide "a great measure of comfort" for the shaken workforce.

Three days after the riot, Maruti locked out a total of 3,300 contract and temporary workers at the plant, which produces 1,500 cars a day, 40% of the company's output.

Just 300 staff will return to work on the first day after the lockout, with an initial production target of 130 cars a day.

Restart Will Be Gradual

"The restart will be gradual, it will be taken up in phases," Bhargava said, confirming that the police had arrested 154 people, including 12 union leaders.

Maruti is majority-owned by Japan's Suzuki Motor which receives more than a quarter of its revenues from India.

The Indian unit, the country's largest carmaker by sales, has lost some $9 million a day from the plant shutdown, analysts calculate.

Maruti last month reported a 23% plunge in first-quarter net profit to 4.24 billion rupees (US$76.6 million), hit by a falling Indian currency with profits expected to be further affected by the riots.

Physical damage to the site amounted to about 100 million rupees, the company said.

The Manesar plant has a history of industrial disputes but none as violent as the July riot.

Haryana state, where the factory is located, is a hub for car production and the state government has expressed concern that the unrest could scare away investors.

-Ben Sheppard, AFP

Copyright Agence France-Presse 2012

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