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| Sunday, 26 October 2003 |
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| News Business Features Editorial
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Reckitts to downsize from 350 to 40? One of the top British multinational firms in the country, Reckitt and Benckiser (Lanka) Ltd (RBLL) has been pushed into turmoil once again with the planned Voluntary Retirement Scheme (VRS) by the Indian management. According to informed sources, the main purpose of the VRS is to reduce the number of employees and shift the manufacturing plant to India. The scheme is likely to be announced in November. The crisis was cited as one of the main reasons that led to CEO Ravi Fernando leaving the company together with seven key executives within a short span of time. "The present management led by Indians has been implementing human resource strategies against business norms," said a company employee. Speculations are that the company intends to down size the staff to 40 from 350, to enable the shifting of the manufacturing plant to India. According to company sources, once the VRS is completed, RBLL will operate as the local distributor and the marketer of its products and brands in the near future. Trade union activists said that under the RBLL VRS scheme, employees will get a small amount of money compared to the other companies who have offered such schemes in the past. According to available information, under the VRS, an employee will be entitled to a full month's salary for each month of service rendered, while he/she will be entitled to half a month's salary for future services until the age of 55. According to sources, the planned VRS scheme is mandatory and the management is planning to reduce the staff from 350 to 40 with the scheme. According to employees, most machines and factory equipment have already been dispatched to India. But management said that those were all excess stuff, which were sold to the Indian company. "We are in the process of looking at external parameters and trends to outsource some of the products from India," said Chairman RBLL Lalith de Mel. He said the management has not announced nor taken any decision to offer a VRS scheme for the staff for this purpose. "Under the Free Trade Agreement with India, we are looking at the possibility of outsourcing certain products in the near future", de Mel hinted. He said the company is presently outsourcing certain products like mosquito coils from India, which is much cheaper. De Mel also said that the company offered an attractive VRS schemes for workers in the recent past. However, no VRS scheme has been announced at present. General Secretary of the Ceylon Mercantile Industrial and General Workers Union, Bala Thampoe said the RBLL trade unions have informed them that the company is looking at the possibility of shifting most of its production lines to India. He said RBLL's move towards shifting its local production operations to India will result in the loss of a number of jobs. According to trade union sources, the majority of RBLL products will be manufactured in India in future, while a very few will be manufactured on a subcontract basis by a local company named Moslanka Ltd. Rohantha Athukorala, one of the top Marketing Managers at RBLL, has also resigned from his post due to him not being in favour with the company's present trends. When contacted by the Sunday Observer, Athukorala declined to comment against the management and said that he is leaving for better prospects. He will take over as Country Manager of a leading US multinational firm. Ceylon Glass Company, Hayleys and Metropolitan are some of the companies that had offered attractive Voluntary Retirement Schemes in the recent past. According to Labour Department sources, they are in the process of drafting certain formulas and guidelines for companies to follow when offering VRS schemes to employees. (HS) |
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