Unilever factory closure: PM pledges immediate measures to end crisis

KATHMANDU, FEB 15 -

Prime Minister Baburam Bhattarai has pledged immediate measures to bring Unilever Nepal’s factory back to normal operation. The factory based in Basamadi, Hetauda, has remained closed for the last 11 days over a wage dispute between the management and workers.

The Prime Minister directed Labour Secretary Som Lal Subedi to intervene in the matter to find a negotiated settlement.

Alarmed by the leading multinational company (MNC)’s closure amid Nepal Investment Year 2012-13, the Prime Minister on Tuesday called officials from MNCs, including Unilever and Surya Nepal, and the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and Makawanpur Chambers of Commerce and Industry (MCCI) to discuss the issue.

Business people taking part at the meeting said the Prime Minister assured them of conducive business environment. “We are happy that the Prime Minister is really serious over the matter,” said Ravi Bhakta Shrestha, a Nepali joint-venture investor for Unilever Nepal. “We hope the factory will come into normal operation soon as per his commitment.”

According to Shrestha, the representatives from the private sector requested the Prime Minister to introduce special packages and policies to address issues regarding multinational companies in Nepal. They also complained about the government’s failure to ensure security of investments at a time when the country is seeking huge foreign investments during the Nepal Investment Year.

A few months ago, Surya Nepal shuttered its garment unit in Biratnagar because of a dispute with workers. “Labour militancy has taken a huge toll on the country’s industrialisation,” said Shrestha.

Trade unions affiliated to UCPN (Maoist) and Nepali Congress have closed down the Unilever factory, demanding a 50 percent pay hike and other allowances, interest-free housing loan worth Rs 1 million per worker and house maintenance fee of Rs 100,000 per person per year, among others.

With talks with the agitating workers failing to yield results, Unilever Nepal has sought the government’s permission to enforce a ‘lock-out’ provision in the factory.

The management registered its application to lock out the factory at the Labour Ministry on Friday and at the Labour Department on Sunday.

As per the Labour Act, a company can declare a lock out of an enterprise after submitting justifications and obtaining the approval of the government if strikes continue or if collective dispute is not solved through dialogue.

If a situation with possibilities of damage to an enterprise through riots, violence, destruction, etc from workers and employees during the strike rises, the management may opt for lock-out even without informing the government, the ACT says. The company, however, has to inform the labour office and the Department of Labour of the lock-out with reasons within three days.

“With the Prime Minister taking the matter seriously, I think the company can prevent the lock out,” said Shrestha. “We ask the government either to work to reopen the factory or allow us to lock out.”

Meanwhile, Tuesday’s talks between the management and workers mediated by the Labour Office and Hetauda Labour Relation Reform Committee ended fruitless.

Arjun Kumar Chaudhary, head of the Hetauda Labour Office, said although the talks couldn’t produce concrete results, the conflicting parties have agreed to sit for regular talks. “They have agreed to sit for dialogue without any precondition,” said Chaudhary.

Following the closure, the company has been losing around Rs 5 million every day and Unilever’s six other ancillary industries have also downed shutters, according to the factory management.

Source: Kantipur