State-run coal companies have suspended operations in some mines and are paying half the salary to the idle employees until production resumes. They also deferred executive benefits as the sector copes with the coronavirus-led lockdown.
Singareni Collieries has suspended operations in 22 underground mines. Approximately a third of its employees will still take half the pay home, the company executives said.
The company operates a mixture of 45 underground and open-cast mines. Mines were unable to operate where social distances were not possible. These mines account for 15-17% of the total coal production.
At Singareni Collieries, as many as 15,000 employees have been affected. The company employs 46,000 and pays an average monthly salary of Rs 85,000.
"As per the guidelines of director general of mines safety (DGMS), requests from several unions and the situation prevailing due to Covid-19, production operations at the 22 semi-mechanised mines were suspended,” a spokesperson for Singareni Collieries said. “However, following recent requests from all the unions, we plan to lift the suspension and resume operation in a few days."
A senior company executive said, “The management was compelled to suspend operations and temporarily cut pay to balance reduction in revenue inflow due to dip in production and sales.”
Riaz Ahmad, general secretary of Hind Mazdoor Sabha at Singareni Collieries said the move is illegal as it can be executed only after permission from the administrative authorities concerned. “We have decided to oppose the move and have already approached the Regional Labour Commissioner’s office. They decided to cut salaries despite orders from the government against such a move," he said.
Coal India subsidiary Bharat Coking Coal has decided to defer payments for duties performed on Sundays, holidays and overtime for the next three months or until the cash flow improves. Similar deferrals are also for the payment of leave travel concessions and long-stay travel concessions payable once every four years.
Neyveli Lignite, Coal India 's Central Coalfields and Eastern Coalfields subsidiaries, which are also reeling under liquidity stress, may need to implement similar measures if demand remains subdued. At present, the cash flows of these companies are relatively better, but executives fear that similar measures may be announced in the event of a deterioration in the situation.
