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Demonetisation effect: In many factories, workers getting salaries in old notes — or not at all

Delhi, according to CAIT estimates, has around 5 lakh small and large factories employing roughly 12 lakh workers.

Written by Sarah Hafeez | New Delhi | Published: December 8, 2016 2:23:54 am

Exactly a month after Rs 500 and Rs 1,000 notes were demonetised, factory owners say they are still struggling to pay workers, while employees say they are staring at two options: going without pay or being paid in old notes.

demonetisation, demonetisation debates, demonetisation effect, black money, Rs 500 Rs 1000 ban, narendra modi black money, modi, currency demonetisation, india news, indian express news Labourers at Khari Baoli market in old Delhi on Wednesday. Many of them say not being able to exchange old notes at banks is a problem. (Express Photo: Amit Mehra)

In west Delhi’s Mayapuri industrial area, many workers said they had been paid November’s wages in old notes. And many of those who accepted the old currency have no bank accounts to deposit them.

“The government has stopped exchange of old notes. The factory owner has given me around Rs 7,000 in old notes, which I cannot exchange. I do not have a bank account either. No one is accepting these notes. What do I do? Burn them?” said Rajesh, one of the 70 workers in an export house, which fired 280 people last month.

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Others, like Amit, put their foot down and refused to take money unless it is in new notes. In such a scenario, factory owners have deferred payments of salaries to as late as February-March, by when “they will be able to arrange enough money”.

There are a few factories — less than 5 per cent of the 1,800 units in Mayapuri, according to IFTU’s general secretary (Delhi) Rajesh Kumar — which have been paying workers through bank accounts for years now. For them, paying salaries was not a problem. But for workers like Lal Yadav, withdrawing the money has been difficult.

Yadav, who works in an iron foundry which paid him his salary two days ago, said, “I have been standing in bank queues for two days. My factory allows us a break from work in emergencies for an hour. If we are later than an hour, the factory automatically marks it as half-day. I took three hours yesterday, got no money because the bank ran out of cash and lost half my day’s wages — Rs 150.”

In most industrial areas, workers have been forced to leave because of low demand affecting production and, consequently, employment. In north Delhi’s Wazirpur industrial area, workers have been fired indiscriminately or sent on forced leave. Uma, who worked in a textiles house in Wazirpur, said, “I was fired last week without pay because I did not have adequate identity proof for the factory owner to open a bank account for me. He said he is going to hire only those with valid accounts from now on.”

Amit, a member of the Dilli Ispat Udyog Mazdoor Union, said factory owners are forced to pay the government-

mandated minimum wages when they pay through bank accounts because it leaves a trail. “Because very few factory owners adhere to minimum wages, most of those paying through banks withdraw Rs 3,000-4,000 from the workers’ accounts a few days later. Owners can do something so blatant because they keep workers’ passbooks and debit cards with them,” Amit said.

Confederation of All India Traders (CAIT) national general secretary Praveen Khandelwal said, “Workers prefer cash because they pay off their loans or credit as soon as they get their salaries. But traders and factory owners are paying them in old notes, and that amounts to injustice to workers.”

Delhi, according to CAIT estimates, has around 5 lakh small and large factories employing roughly 12 lakh workers.

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