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Kerala: Amid strike called by union, Muthoot calls for closure of affected branches

Operations at 300 branches out of 611 in the state have been hit, the firm said. At the crux of the strike is Muthoot Finance’s refusal to acknowledge the Non-Banking and Private Finance Employees Association (NBPFEA), formed four years ago.

Written by Shaju Philip | Thiruvananthapuram | Updated: September 4, 2019 7:20:33 am
Muthoot Finance Director (Public Relations) Babu John said only 220 employees out of 2,850 in Kerala had joined the union.

A strike called by a CITU-affiliated trade union has disrupted operations of Muthoot Finance in Kerala since August 20. Operations at 300 branches out of 611 in the state have been hit, the firm said. At the crux of the strike is Muthoot Finance’s refusal to acknowledge the Non-Banking and Private Finance Employees Association (NBPFEA), formed four years ago.

The issue reached a flashpoint on Tuesday when people linked to CITU — a trade union affiliated to the ruling CPM — prevented Muthoot MD George Alexander and his staff from entering the firm’s head office in Kochi. Alexander staged a sit-in front of the office, while others held placards saying “right to work”.

Alexander later told media, “We are not allowed to open offices in our home state. There is no option for us. We have decided to close the branches that we cannot operate because of the agitation. It will be done in a phased manner.”

Explained

Unions now eye sunrise sectors

As several traditional sectors of employment have been sliding over recent years, trade unions in Kerala have set their eyes on financial, IT and similar sunrise sectors, which employ professionally qualified persons mainly from the middle class. A major chunk of the 220-odd employees of Muthoot Finance who have joined the trade union are those who had worked as office assistant and got promoted to sales division. Gold loan lending is a major business vertical of the firm.

“In two and a half years, we have faced agitation eight times. We cannot run the firm in Kerala like this. Please allow us to run business elsewhere,” he said.

There were reports from across the state that local CITU groups had gathered in front of offices of the firm and threatened employees against opening branches. CITU had earlier issued a notice to all local offices urging them to form support groups for the agitation in all branches in Kerala.

Muthoot Finance Director (Public Relations) Babu John said only 220 employees out of 2,850 in Kerala had joined the union. “We have a staff of 35,000 across India, and we face trouble only in Kerala. Most of our staff have no complaints about service and salary conditions. In the last three years, 200 branches operating under loss have been merged with other branches, but not a single employee had been terminated. But CITU wanted to interfere in the firm. The affiliated union NBPFEA has support of a negligible number of staff. Our staff are against the agitation, but CITU has deployed local goons and workers from outside to prevent our operations,” he said.

CITU state general secretary and CPI(M) central committee member Elamaram Kareem said the management victimised employees who joined the union. “There is no clear-cut salary structure and union members have got a raw deal. Union members have been shunted out of Kerala. We have the support of majority of the employees, who are reluctant to come out openly,” he said.

Kareem, a Rajya Sabha member, said the company should conduct a referendum among employees about support to the union. “If we get enough support, we are ready to withdraw the agitation,” he said.

John said that interference by the union had led to a fall in the firm’s business. “The share of business from Kerala has fallen to 4 per cent from 11 per cent in three years. However, total business of the firm has grown by 50 per cent due to robust growth in 3,900 branches outside Kerala. Employees are paid much above the minimum wages apart from mandatory benefits. Salaries and service conditions in Muthoot are on a par with any other firms in the category,” he said.

Labour Minister T P Ramakrishnan, also a CITU leader, was not available for comment. His office said the labour commissioner held a discussion on August 17, but Muthoot did not come forward with any amicable solution.
“The firm was represented by two persons who could not make any decision. The top management has been keeping away from the discussion. The basic issue is their reluctance to acknowledge the trade union. We have convened another meeting on Wednesday,” official said.

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