PepsiCo has decided to close its production unit in Kerala due to alleged labour unrest.
This comes 15 years after Coke, another soft drink major, wound up its plant in the state.
The PepsiCo unit in Palakkad, operated by franchisee Varun Beverages Ltd, served a mandatory closure notice to the state labour department on Tuesday after being in lockout since March.
The employees at the unit — affiliated to CITU (of CPI-M), INTUC (of Congress) and BMS (of RSS) have been protesting since December, demanding wage hike and better service conditions for contract labourers — demands that were pending for a year then.
As the protest by 280-odd contract workers was joined by 110 regular employees, production at the unit was affected. Subsequently, the management declared a lockdown from March 22.
The unit, established in 2001 at the industrial belt Kanjikode, has been engaged in packaged drinking water and soft drinks under Pepsi brand.
In March 2019, PepsiCo had handed over the plant to its bottling partner Varun Beverages due to labour strike demanding benefits and hike in wages of contract labourers. Before being assigned to the franchise, the plant had been closed for a while. Production resumed after an agreement was arrived at with workers.
Sources in the management said they had to go for lockdown because of the loss caused by the strike in February this year. Even though police protection was provided, employees on duty were assaulted, they said.
CITU leader and Joint Trade Union Action Committee general secretary S Ramesh said the closure would impact 500-odd employees who are directly or indirectly associated with the firm. “Several rounds of talks have been convened in recent months, but the management sticks to its stand. We have been demanding better wages, ESI and bonus for contract labourers,” he said.
Labour department officials said the company has issued the final closure notice. “Several rounds of discussions were held but no conciliation could be arrived at. In the next 90 days, there may be another round of talks as a final attempt to salvage the unit. But because the unit has been in lockout since March, a positive result is unlikely,” sources said.
In 2004, Coke ended its operations at Plachimada in Palakkad district following mass protests against pollution and overexploitation of groundwater. Coke had established the plant in 1999.
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