Hopes of over 1,100 employees for revival of the tractor unit of HMT factory in Pinjore were dashed on Thursday, as the Union Cabinet approved the closure of the factory and disbursement of VRS to all its employees. Asserting that the tractor division was incurring losses and its continuation with its insignificant market share in the sector might not be a financially viable option for HMT Limited, the Cabinet stated that the unit be closed down and focus be shifted on the machine tools unit.
“In view of the deteriorating position of the company and hardships being faced by employees due to non-payment of salaries and other dues, the tractor unit be closed down and attractive Voluntary Retirement Scheme (VRS) be given to its employees at 2007 notional pay scales,” read the order.
A budgetary support of Rs 718.72 crore was announced for the factory for payment of outstanding salaries, other employee-related dues, VRS and clearing of the tractor division’s liabilities towards banks and creditors.
Over 1,100 employees of the tractor unit have not been paid their salaries since July 2014 while statutory dues have been pending since November 2013. “We do not know what to say. The last hope has gone now. There are over 450 employees for whom VRS will not offer much. We had come here for a job and that is all we wanted to keep doing,” said Mahender Singh, president, HMT Employees’ Union.
Advocate V K Bansal, who had been spearheading the cause of the employees, said it had left the employees dejected. “Until now, the employees had a hope that the factory will be revived, but it seems to be over now. The government has left the employees in the dark few days before Diwali,” he said.
However, Kalka MLA Latika Sharma hailed the government’s decision stating that the employees would be relieved as their pending salaries would be released. “One should not merely look at the closure of the factory, but focus on the other aspect of the decision of releasing salaries, which had been pending for the last two years. The families were struggling with a financial crisis.”
She added that HMT’s ailing condition had been continuing for years and the last two years could not be blamed for its closure.
A central public sector enterprise, HMT tractor division was established in Haryana in 1971 to manufacture HMT tractors. However, performance of the company began to decline in the 1990s. The government highlighted that several efforts were made in the past to arrest the declining trend, but no success was achieved, following which the decision on closure was taken.