Bajaj Auto places employees above business interest, no pay cuts in April

Pune-based two- and three-wheeler major Bajaj Auto has reversed an earlier decision to implement a pay cut for its employees for the month of April. The company had earlier proposed  a 10 percent cut in salaries to conserve cash in the wake of the ongoing Covid-19 pandemic in India and the subsequent manufacturing plant shutdown along with the countrywide lockdown. It is understood that the company unions and employees had agreed to a wage cut for the April 15-30 period. Even the contract labour will be paid in full for the month of April.

Now in an internal letter to its employees, which indicates a change of heart, Bajaj Auto has decided not to implement any salary cuts for April 2020. As per a Hindu Business Line report, in an internal communication to its employees, the company has said: “We have come to the conclusion that this is a time when we must act more from our hearts than our minds. Our business depends first and foremost upon each and everyone of us, from the top to the bottom. Before we reach out to support our larger society, we are first obliged to secure our own; so long as we can help it, not a single child of the last contract worker must sleep hungry on our watch."

Bajaj Auto, it is learnt, will review the situation around end-May while factoring “the degree of positive impact on our business of the implementation of the progressive unlocking that is anticipated."

The company's action is worth lauding considering that due to the ongoing all-India lockdown, there have no sales whatsoever in the domestic market and exports are also down. In April 2020, while domestic sales of motorcycles were zero last month compared to 205,875 in April 2019, motorcycle exports were 32,009 units, down 80 percent year-on-year (April 2019: 160,393). Likewise, on the commercial vehicle front, zero sales in April 2020 versus  26,229 units a year ago. However, a total of 5,869 CVs were exported last month, down 81% YoY (April 2019: 30,818).

Bajaj Auto's letter to its employees concludes on a positive note: “As soon as we are open for business, we shall as always as one spirited team have Bajaj Auto roaring back upon global roads full throttle."

Also read: Bajaj Group commits Rs 100 crore for fight against Covid-19