Dear all,

We have never had labour unrest at our organisation before. The company was recently taken over by an US based MNC. After the takeover, the employees were NOT benefited financially (by way of additional incentives or rise in salaries). A certain section (predominantly the sales team from a few branches falling under a particular Regional Office) which contributes over 50% of our National Sales turnover, have resorted to strike (Pen down / harassing staff and clients etc.). Demanding Rise in Salaries and Bonus.

With the ongoing festive season, being our prime sales period - this attitude has had a major toll on our reputation / sales and service. Moreover the new product range (new vertical) specifically imported for the festive season, have a shelf life of six months, hence cannot be stored for sales at a later date. No amount of convincing has been fruitful, as the employees have the backing of a Union of a predominant political party, and are actively instigating employees of other branches to join in.

The new management's suggestion, which is gaining ground is to :-

- sack the striking employees / close those respective branches /departments - and go for fresh appointments

- potential legal battles can be addressed - later.

The management has left it to HR to work with the legal advisors, to address and settle the problem - ASAP Any faster methods? How do we tackle it?

Warm Regards,

Jigyasa

I would suggest that a high ranking representative of the company, along with the head of HR visit the problem offices/sites and discuss the reasons behind the failure to increase salaries/bonuses. 

Some areas for discussion may be the current worldwide economic downturn; the need for review, reflection and reconsideration in the wake of the purchase/ takeover, or a consideration of some sort of "gain sharing scheme whereby the employees have the opportunity to "earn" bonuses by cost cutting, suggesting efficiencies, and improving the means and methods of produciton and sales.

In addition, it should be stated that the company has faith in the workforce; that they will do the right thing at this time.  For their understanding and cooperation, the company will consider alternative compensation/ incentive plans proposed by the employees.

If such a strategy fails, then, concurrently, plans should be made to close the problem offices/sites, relocate elsewhere with a totally new workforce, from the top down.

1.Once the genesis of unionism sets in, it is very difficult to get rid of it, do not try

2.Threats of firing etc. will worsen the situation - unioinsm will spread to other locations, people will become militant

3.If you still have some old " good-will " & transparency left amongst people, advocate a frank dialogue to explain (a) the economics of the company, particularly importance of season, (b) reinforcement of bilaterlism, (c) getting support to say lets first do our best to sell out stocks and continue talking about monetary / non-monetary improvements - promishing to do a formal study & impact on co etc. (d) may offer a " token ' incentive or increase & (e) establish a culture of establishing genuine targets, continuous communication on what is happening to the targets & the company and aim at incentives based on achievement of Sales/reduction of costs etc.

4.MNCs generally like to reward basis performance (and not annualised increases) - there are many Indian Companies controlled by MNCs have gone in for performance based incentives - so you can try too.

But dialogue is a must, transparency must prevail, return to mutuality of interests.

Best luck

The new management's suggestion, which is gaining ground is to :-

- sack the striking employees / close those respective branches /departments -
and go for fresh appointments 

 - potential legal battles can be addressed - later. 
 
The management has left it to HR to work with the legal advisors, to address
nd settle the problem - ASAP  Any faster methods? How do we tackle it? 

Question and comment on your problem;

1). Setting aside the potential political issues, did anyone do analysis on wage data to understand whether or not the current wage structure is valid? Just being acquired, even by a US based MNC does not guarantee any increase. Analysis should be done and fact based recommenda(ions put forth by HR.

2). Sacking employees in such any abrupt manner is short sighted and will breed firther organizational issues in the future and would likely become a bad long term decision.

3) Has anyone from the Home Office taken the time to spend any time on the ground locally with employees? This is essential for long term understanding and making the
acquisition successful. I hope this helps.

Cheers

Ruchi