• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Our Bureau

KOLKATA, Dec. 2

SAREGAMA India Ltd — the music and entertainment company in the RPG fold — has decided not to force the issue of either manpower reduction or wage freeze on its employees now.

Mr Abhik Mitra, Managing Director of SIL, said that although it was necessary to reduce the workforce, the company preferred a consensus approach on this.

Regarding wage freeze, he said wages needed to be brought down to levels that were realistic for an industry passing through bad times.

Since June this year, the SIL top brass have been engaged in discussions with their unions at the manufacturing facility in Dum Dum on the issue of reduction of factory overhead costs.

The company maintained that its fixed cost was the highest in the industry.

Mr Mitra said that a reduction in material and fixed costs was also being necessitated by a shift in the buying pattern from music cassettes to compact discs.

Availability of cheaper CD players coupled with the reduction in CD prices has boosted CD sales at the cost of cassettes. "In a stagnant industry which is plagued by piracy problems, this has affected our capacity utilisation at the Dum Dum unit where only cassettes are made," Mr Mitra said.

However, the unions led by the CITU-affiliated Gramophone Workers' Welfare Union are in no mood to listen to Mr Mitra's litany of woes.

Mr Swapan Gupta, general secretary, GWWU, the majority union, said that rather than suggesting a wage freeze and manpower reduction, the SIL management should take steps for immediate reduction of the high overhead costs incurred on senior executives and build up an integrated sales network to push SIL's products and its 100-year-old catalogue.

He said that over the last two decades, the Dum Dum factory had been drastically downsized and over 1,700 workmen had been forced to leave thorough VRS.

SIL now has around 730 employees (including officers) on its rolls. Company insiders said that the ideal workforce should be around 200.

The Dum Dum unit, which has a capacity to manufacture 1.9 lakh cassettes daily (in three shifts), now makes only around 1.2 lakh cassettes, sources said.

In a recent submission to the management, the CITU union together with the INTUC-affiliated Gramophone Employees' Union pointed out that despite subsequent manpower reduction programmes, the company moved from a Rs 5 crore loss in 2000-01 to a Rs 25 crore loss in the next year. The current fiscal was not expected to be any better, they said, adding that of the Rs 15.8 crore staff cost, only a third was being spent on salary of the workmen at Dum Dum.

Send this article to Friends by E-Mail
Comment on this article to BLFeedback@thehindu.co.in

Stories in this Section
BEML set to foray into infrastructure equipment

Copyright © 2002, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line