Videocon's largest plant in Aurangabad, Maharashtra is on the brink of an employee outbreak as many of the workers haven't received their remuneration in the last 10 months. According to the workers Business Today spoke to, the plant is almost shut and the production happens only for third-party contractors. The bankrupt company's plant has a workforce of around 6,000 and the workers there are uncertain about what the future holds for them.
Gajanan Bandu Khandare, President of Videocon Group Employees Union, confirmed that employees have not received their respective salaries or pay for last 10 months.
The workers said that the plant is not fully operational and it starts operating when there is a third-party order. Another worker on condition of anonymity said that the earlier promoters are regular visitors to the plant.
"Rajkumar Dhoot and Pradip Dhoot were in the plant about a week back with their personal security. The workers were not allowed to go and meet them," said Khandare. He claimed that the management is harassing workers by filing police cases for protesting against not getting salary. Khandare claims that he was sent to jail three times for raising the voice.
There are three major unions at the Aurangabad plant. The workers also allege that some of the union leaders are merely complying with the management even though they too haven't received their salaries. "We have not been able to pay for the education of our children and hospital urgencies. The marriages of our daughters are being called off because of financial difficulties," said a worker in his 50s.
Many of Videocon's executives left the company when it started defaulting the loans. Some of them have filed for their claims with interim resolution professional (IRP), who was appointed by National Company law Tribunal (NCLT). "Those who have spoken up against the management have been served with court orders and notices," said a former executive. About 100 to 150 people from the employee force must be facing criminal cases in various courts of law, he added.
"The workers have been sued with bogus charges that have been mostly disregarded by judicial authorities. We won a case against the management in the Supreme Court where it was upheld that Videocon was required to pay it's employees the minimum wage, which is 10,500," said Khandare.
The plant, at present, is in contract manufacturing of fridges, washing machines and other electrical appliances, depending on the orders from companies like LG, Philips and Hyundai.
The employees submitted their claims worth Rs 103.5 crore to resolution professional (RP) until May 27. RP received claims of whopping Rs 59,452 crore from financial institutions, besides claims of Rs 57,823 crore from the Dhoot family members for their personal guarantees provided to loan facilities to the company. The financial institutions have claims of Rs 26,673 crore in another bankrupt firm Videocon Telecommunication. SBI has the highest exposure in both the companies--- which together comes to around Rs 15,780 crore.
In the last three quarters until December 2018, Videocon Industries posted a total loss of Rs 5,122 crore. The loss was Rs 5,264 crore in 2017-18. For a comparison, during its heydays 10-12 years back, the company had revenues of Rs 10,000 crore and profit of over Rs 800 crore. The company's share price is now at less than Rs 2 and it was at Rs 755 in January 2008. Videocon's present market value of Rs 54 crore is just like the price of any sea-facing apartment in South Mumbai.