GM India's Talegaon plant closure conditionally approved by Maha govt

14 Jul 2023 CW Team

On March 13 of this year, Hyundai Motor India signed a term sheet with General Motors for a potential acquisition of the Talegaon facility. The final deal is dependent on meeting certain conditions, including obtaining regulatory approvals from relevant government authorities and all stakeholders involved in the acquisition.

Interestingly, the approval was granted while the General Motors Employee Union and the company were still engaged in a lengthy legal dispute. The workers claimed that their terminations were illegal following the company's decision to exit the country. Legal battles have been on-going since 2021. General Motors initially applied for plant closure on November 20, 2020, and later submitted a fresh application on June 27 of this year, citing excessive delays.

A spokesperson from General Motors expressed gratitude for the approval of the closure application and acknowledged the support received from the Government of Maharashtra throughout the years. However, the president of the GM Union, Sandeep Bheghade, stated that the union would seek legal advice on the matter and refrained from providing immediate comments.

According to the approval, a settlement package will be provided to affected employees, which includes 110 days of wages per year of service. The GM spokesperson mentioned that impacted employees had already received statutory benefits and encouraged them to come forward and accept the remaining portion of the separation package.

The approval was outlined in a six-page order issued by Suresh Dagadu Khade, the Minister of Labour for Maharashtra State, on July 5. The order was in response to General Motors India's application filed on June 27, seeking permission to close the plant. In its application, General Motors stated that the plant could not be made functional under any circumstances due to significant losses. The company reported a loss of over Rs 90 billion between 1994 and 2022. As a result, the government granted permission for closure, subject to specific conditions.

As per the conditions stated in the order, the remaining workers will receive the same package as their former colleagues, and General Motors is required to settle all outstanding dues within the next 60 days. The company must also obtain a no-objection certificate, a no-dues certificate, and other necessary permissions from relevant agencies as mandated by the law. Lastly, the order stipulates that the "applicant may provide job details of the workers to new incumbents."

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General Motors India announced that it had received approval from the Maharashtra Government for the closure of its Talegaon plant. The move was seen as a positive step towards resolving the ongoing dispute with the union and establishing a commercial agreement with Hyundai Motor India. However, despite this development, General Motors' exit from India is still far from complete. The approval was granted under specific conditions, which included providing a separation package, obtaining a no objection certificate from various agencies, and sharing job-related information about the workers with Hyundai Motor India. On March 13 of this year, Hyundai Motor India signed a term sheet with General Motors for a potential acquisition of the Talegaon facility. The final deal is dependent on meeting certain conditions, including obtaining regulatory approvals from relevant government authorities and all stakeholders involved in the acquisition. Interestingly, the approval was granted while the General Motors Employee Union and the company were still engaged in a lengthy legal dispute. The workers claimed that their terminations were illegal following the company's decision to exit the country. Legal battles have been on-going since 2021. General Motors initially applied for plant closure on November 20, 2020, and later submitted a fresh application on June 27 of this year, citing excessive delays. A spokesperson from General Motors expressed gratitude for the approval of the closure application and acknowledged the support received from the Government of Maharashtra throughout the years. However, the president of the GM Union, Sandeep Bheghade, stated that the union would seek legal advice on the matter and refrained from providing immediate comments. According to the approval, a settlement package will be provided to affected employees, which includes 110 days of wages per year of service. The GM spokesperson mentioned that impacted employees had already received statutory benefits and encouraged them to come forward and accept the remaining portion of the separation package. The approval was outlined in a six-page order issued by Suresh Dagadu Khade, the Minister of Labour for Maharashtra State, on July 5. The order was in response to General Motors India's application filed on June 27, seeking permission to close the plant. In its application, General Motors stated that the plant could not be made functional under any circumstances due to significant losses. The company reported a loss of over Rs 90 billion between 1994 and 2022. As a result, the government granted permission for closure, subject to specific conditions. As per the conditions stated in the order, the remaining workers will receive the same package as their former colleagues, and General Motors is required to settle all outstanding dues within the next 60 days. The company must also obtain a no-objection certificate, a no-dues certificate, and other necessary permissions from relevant agencies as mandated by the law. Lastly, the order stipulates that the applicant may provide job details of the workers to new incumbents. Also read: Hild Electric bags NTPC order for alkaline electrolysers FIVE becomes first hotel to obtain i-RECs in UAE

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