GM in India has not paid compensation to dismissed employees
2023.01.19 06:31
GM in India has not paid compensation to dismissed employees
By Tiffany Smith
Budrigannews.com – General Motors (NYSE:) has been sued by a union in India. local unit and its global CEO for failing to compensate fired factory workers in accordance with a court order, making it harder for the U.S. automaker to leave the country years after it shut down local operations.
After years of low sales, GM stopped selling cars in India in 2017. However, the company’s complete exit from the market was marred by complications, such as legal disputes with workers and the failure to acquire a plant in the western state of Maharashtra after talks with China’s Great Wall Motor failed last year.
Since 2021, GM and the factory workers have been locked in legal battles over allegations of illegal termination following the company’s decision to exit. Workers have accused GM’s India unit and its executives, including CEO Mary Barra, of failing to comply with court orders, and the most recent filing suggests that the dispute will get worse.
According to the documents, the General Motors Employees Union, which represents 1,086 factory workers, stated in a filing dated January 16 that the company has failed to pay them compensatory wages equal to 50% of their monthly salary since April of last year, as ordered by a local industrial court that continues to hear the dispute.
Based on the order of the industrial court, a union leader told Reuters that GM owes the workers approximately $3 million in wages at this time.
A spokesperson for General Motors stated that the company is “very confident” in its legal position. Including ” The (plant) site sale options are still being considered by GM.
It has claimed in previous court filings that the industrial court ordered the compensation beyond its authority. The company has previously stated that it has attempted to resolve the conflict amicably and has provided generous severance pay to employees.
The union expressed its disagreement, stating that GM continues to “blatantly violate” the industrial court’s order by not paying the workers a penny. The union asked the court to hold the company and its executives in contempt and sentence them to prison in its most recent filing.
The union stated in the filing, which was not previously reported, that “the workers are unable to feed their families, pay for medical expenses, and pay for their children’s education.”
In the coming days, the lawsuit is likely to be heard.
Some Western automakers, particularly American ones, have struggled to challenge Japan’s Suzuki Motor and South Korea’s Hyundai Motor, which together hold about 60% of the market, in India. Ford Motor (NYSE:) shares GM’s in 2021, ceased operations in India.
At the end of 2017, GM stopped selling cars in India. However, one of its two factories continued to make cars for export until December 2020. After that, General Motors stopped doing anything and moved to close the plant in Maharashtra, but it hasn’t been given permission.
GM’s applications to close the plant have been rejected by the state government, which the company has said sends a “concerning message” to potential investors.
