Agri Business

Plantation sector seeks govt support to pay wages

Vishwanath Kulkarni V Sajeev Kumar Kochi/Bengaluru | Updated on April 07, 2020 Published on April 03, 2020

The 21-day lockdown has pushed the plantation sector into a precarious situation. With no revenue, the managements say, they can ill afford to pay wages during the period, and are looking for support from the government to overcome the crisis.

The plucking of tea in many plantations has come to a standstill and the operations are expected to resume only after 75-90 days. It will take considerable time and labour to bring the estates back to active production levels and, till then, cash flows will be under stress, said industry representatives.

“Wages for the workers and the staff are to be paid now,” said N Lakshmanan, a senior tea planter in Coonoor. “In view of the dwindled cash flow, if the government can consider extending an interest-free loan to pay the wages for March and April, it will be most welcome.”

Further, Lakshmanan suggested, the loan should be repayable over a 24-month period, with a holiday for the first six months.

Wage revision

“We are reeling under a severe financial crisis since 2015 across all plantation crops. During such a crisis time, there was a demand for wage revision. We have considered a substantial revision and implemented it from January 1, 2020,” said a plantation industry source.

The prices of commodities such as tea, rubber and coffee have headed southward in the last four months. In such a scenario, estates are finding it tough to meet even the statutory requirements.

All the estates are currently going through a severe cash flow crisis due to the inability to liquidate stocks, and financial institutions are not extending any support either, said sources. “While agreeing that the workers are going through difficult times, the estates have no capacity to pay during the lockdown period,” said one of the sources.

However, the sources added, the managements are willing to discuss the issue with all the stakeholders to evolve a plan of action.

But this requires the support of the government and trade unions, they said.

Legal sources said employers are liable to pay wages to workers only for the period they had worked. The current lockdown is not a case of lay-off as defined under the Industrial Disputes Act, they added. The orders and guidelines issued under the Disaster Management Act, 2005, have no provisions requiring estates to pay wages in the case of a lockdown, they pointed out.

Published on April 03, 2020

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