Did Maruti Suzuki really pay their union leaders more than they deserved to quit?

This year, problems for India’s largest car manufacturer, don’t seem to stop. Maruti Suzuki India (MSI) has been struggling to get their manufacturing units perform to capacity for the past 6 months, but unending strikes by their workers, has only added to their woes.

In order to put an end to workers strike once and for all, Maruti Suzuki launched VRS – Voluntary Retirement Schemes. VRS would allow a golden chance to workers to leave the company with a hefty check, without any conditions. Those workers who do not opt for VRS, will be allowed to get back to work.

Maruti Suzuki launched VRS to get rid of their troublesome workers. This was also a very good option for the troublemakers, cause if they had not opted for the VRS, they would have been summoned for an inquiry at a later stage, and if found guilty, would have been fired without any kind of compensation. Luckily, none of the workers have been fired, yet.

Maruti Suzuki, with the help of VRS card and less than Rs 5 crore, got rid of all their workers who were holding them back. Mr Shiv Kumar, Former President & Union Leader, Maruti Suzuki Workers Union, said, “There was an inquiry against 30 of us, and we knew the outcome. So, all 30 of us decided to take the money from the company. We were not willing to fight with the company. There is nothing to hide as far as the amount received goes. All 30 of us got Rs 16 lakh each.”

Maruti Suzuki spokeperson confirmed this and stated, “The workers have taken their full and final settlement from the company.” Strike ends, production resumes, and Maruti problems end. Well that is not the case. Some Maruti workers have now alleged that MSI management paid Rs 1 crore each to Sonu Gujjar and Shiv Kumar.

One of the workers who accepted VRS, said, “I have resigned from MSI and received a check of Rs 16 lakhs. After the news of Gujjar and Kumar resigning emerged, I had no other option but to resign. The company has offered us the negotiated amount which is our severance package in lieu of resignation from services.” Shiv and Sonu were leading the pack against MSI, but once they accepted VRS, those following them were left with no option but to follow in their foot step.

Earlier yesterday, Subey Singh, Union Leader, Suzuki Powertrain, which is MSI’s engine manufacturing subsidiary, stated that he has been offered money by MSI to resign. Singh added, “I have been offered money, many times higher than that offered to Maruti’s labour leaders. They have been asking me what is it that I want (to resign). However, I have refused to accept any payout. I will not become a traitor to the labour workforce that has elected me their leader. They want to keep us out. However, we have refused any ‘financial settlement’ and are ready to battle legally if they dismiss us.”

Maruti has already suffered production loss worth Rs 2,000 crores this year and this figure keeps increasing by the day. Maruti Suzuki drives the Indian auto industry as they have almost 50% market share. One of the major reasons behind Indian auto industry registering their steepest fall in sales (percentage wise) since Dec 2000 is because of workers strike at MSI. Maruti needs to get past these problems at the earliest.