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Rediff.com  » Business » Nokia offers VRS for staff at Sriperumbudur facility

Nokia offers VRS for staff at Sriperumbudur facility

Last updated on: April 11, 2014 12:40 IST

Finnish handset maker Nokia on Thursday announced a voluntary retirement scheme for its workers at the Sriperumbudur factory near here, which is caught in a legal tussle with income tax authorities.

R Soundararajan of the Centre of Indian Trade Unions, which has been supporting the employees’ union at the facility, said, “We will not take it (VRS); we will inform this to the firm.”

A few employees said for those opting for the VRS, the company had offered salaries for 15 months (current salaries), along with Rs 100,000.

Compensation for earned leaves will be calculated on the basis of an employee’s per-day salary, keeping the basic salary in mind.

For every earned leave due, the firm has offered to pay double the per-day salary thus calculated.

An employee said the company’s announcement, made late this evening, had a number of ambiguities.

He said compensation should be calculated based on the experience of a person, adding the salary considered might be net or gross, and the company’s offer didn’t specify which it would consider.

Also, the offer on earned leaves aroused suspicion, the employee said.

The company has said it regularly reviews its manufacturing strategy to optimise and ensure the smooth and timely delivery of products.

This process considered many factors, including the predictability and stability of the regulatory environment in the countries in which it operated, it added.

It said, “Following such a review, we can confirm we have launched a voluntary package at our Chennai facility.

“As a responsible employer, Nokia is offering a clear financial option for interested factory employees.

“We feel this package offers staff the chance to seek new opportunities outside the company, based on a firm financial footing.”

A company spokesperson said the company hadn’t set any target for the VRS, in terms the number of employees, adding all employees coming forward for this were entitled to the package.

The company has said staff at the Sriperumbudur factory has historically fluctuated, based on demand and the number of external employees; currently, the number of full-time employees at the plant stands at about 6,600.

The fate of the factory, which employees about 8,000 people directly (60 per cent of which are women) and an additional 21,000 indirectly, remains uncertain, as courts and tax departments have attached Nokia India’s assets, including the Sriperumbudur factory with regard to a alleged tax evasion of Rs 21,000 crore (Rs 210 billion).

Recently, the Tamil Nadu government had issued a Rs 2,400-crore (Rs 24-billion) tax notice to the company.

The factory, along with many other Nokia factories across the world, was scheduled to be transferred to Microsoft, which had decided to acquire Nokia’s devices business in a euro 5.44-billion deal.

Involuntary retirement scheme

• Nokia has offered salaries for 15 months, along with Rs 1,00,000, for those opting for the VRS
• The company hadn’t set any target for the VRS, in terms the number of employees
• All employees coming forward for this were entitled to the package, said a company spokesperson
• The factory employees about 8,000 people directly and 21,000 indirectly

T E Narasimhan in Chennai
Source: