This PSU Will Ask 13,000 Employees To Leave Every Year For Next 5-10 Years
Coal India Ltd (CIL) is planning to reduce 5 percent in manpower every year for the next 5-10 years to reduce costs as per its announcement on Tuesday.
Why Would this Happen?
So far, Coal India is the world’s largest miner, accounting for over 80 percent of the domestic coal output.
On Monday, the state-owned miner reported a marginal 1.1 percent decline in its consolidated profit at Rs 4,586.78 crore for the quarter ended March 2021 caused by the lower sales.
During the same period a year ago, it had posted a consolidated profit of Rs 4,637.95 crore, according to the Coal India Ltd (CIL) filing to the BSE.
Reduced Sales And Reduced Expenses
As per the filing, the coal behemoth consolidated sales in the January-March period declined to Rs 24,510.80 crore, from Rs 25,597.43 crore in the March quarter of 2019-20.
There is also a drop in the expenses of the company, during the January-March 2021 quarter.
It has dropped to Rs 21,565.15 crore from Rs 22,373.046 crore in the year-ago period.
This was caused by the drop in production of CIL during the quarter. It has dropped to 203.42 million tonnes (MT) over 213.71 MT in the corresponding quarter of 2020.
With these figures, the company’s offtake during the January-March period was at 164.89 MT, over 164.33 in the corresponding quarter of 2020.
Issues With Labour And Salary Hike
This month, CIL management was likely to start negotiations with the trade unions this month over the salary hike.
It seems that this move is likely to have a financial impact on the world’s largest coal miner to a large extent.
As per the norms, every fifth year, CIL is to go through a revision of the wages of the employees and the next hike is due from July 2021.
While talking about the impact of this hike, Nathulal Pandey, president of HMS-affiliated Hind Khadan Mazdoor Federation, Pandey said it would be to a large extent.
Fall In Headcount
For some time, the headcount of the firm is steadily falling as the net reduction of employees is to the tune of 13,000-14,000 per annum.
In future, the fall is likely to increase further due to natural attrition in the ensuing years, making the company leaner and fitter.
in 2017, the coal behemoth had signed a wage agreement with worker’s unions proposing a 20% hike in salaries for five years.
Currently, CIL has a total workforce of 2.59 lakh, in that around 15,000 is the executive staff while the rest is the non-executive staff.