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    GM India plant employees reject final separation offer, company stands firm

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    GM India plant employees reject final separation offer, company stands firm

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    American automobile maker General Motors’ plan to wind up its manufacturing facility in Talegaon in Maharashtra is in trouble again. A large majority of the company’s employees have refused GM’s final settlement offer. The GM Employees Union (GMEU) said that it wants to negotiate a better deal with the company in the absence of guaranteed employment with Great Wall Motor to which the plant has been sold. GM for its part says the offer will not be improved and the scheme will be withdrawn today.

    American automobile maker General Motors’ plan to wind up its manufacturing facility in Talegaon in Maharashtra is in trouble again. A large majority of the company’s employees have refused GM’s final settlement offer. The GM Employees Union (GMEU) said that it wants to negotiate a better deal with the company in the absence of guaranteed employment with Great Wall Motor to which the plant has been sold. GM for its part says the offer will not be improved and the scheme will be withdrawn today.
    While the General Motors Employees Union has formally rejected the separation scheme offered by the company -- equivalent to 3 years and 7 months of salary after-tax on average according to GM – only 10 union members and 120 non-unionized workers at the plant have taken the offer so far by deadline day. Sandeep Beghade, President, GMEU, said that 10-15 more members may accept the VSS by the end of the day. Even with that, the vast majority would have still not accepted the offer.
    Beghade told CNBC-TV18 that the Union is looking to negotiate a better separation package with the management and that the offer in its current form is not acceptable to the Union. The Union will also be looking to negotiate other schemes and benefits such as life insurance, health insurance and benefits for the employees’ children to safeguard their families’ futures, Beghade told CNBC-TV18.
    The Union is demanding that the VSS package be calculated based on the employees’ remaining years of service, which would be 20 years or so on average for most employees at Talegaon. This would accrue to a higher package than the current scheme calculated based on the years of service the employees have already put in. The average payout under the present scheme on offer would translate to nearly 20 lakhs on average for an employee with an average of 10 years of service with the company.
    The employees union is also contesting the company’s decision to lay off its 1419 employees on April 16. An industrial court will hear the matter and rule on the legality of the lay-off the company declared citing the rampant upsurge of Covid-19.
    General Motors has told CNBC-TV18 that the lay-off will continue to be in force at the Talegaon plant even if a majority of the workers do not accept the VSS beyond the deadline.
    “The time for other alternatives is over and this deadline is very real. We are down to the last day and it is important that employees take the decision now”, George Svigos, Director, Corporate Affairs, General Motors told CNBC-TV18.
    “We need the Union to communicate that this is the best offer and it will not get better than this”, he added. General Motors maintains it is obligated to pay lay-off compensation only for 45 days at the maximum as per the certified standing orders of the company.
    GM and China’s Great Wall Motor signed an agreement for the sale of GM’s Talegaon plant to GWM in January 2020. “The Talegaon plant (is) key to Great Wall Motors’ plans to enter India’s domestic vehicle market”, GWM had said in a statement announcing the deal.
    However, the deal has fallen into hurdle after hurdle since last year. The government approval necessary for the sale transaction to go through is still pending, even as General Motors continues to seek FDI (Foreign Direct Investment) clearance for the deal.
    Meanwhile, both parties remain committed to the deal, GM has clarified.
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