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Several entrepreneurs are unable to pay their workers competition advance and bonus
With the festive season drawing close to, businessmen and entrepreneurs within the Micro Small and Medium Enterprises (MSME) sector are dealing with a new challenge: paying their workers competition advance and bonus.
With commerce but to revive and attain pre-COVID-19 ranges, businessmen are anxious. While some units are requesting their workers for extra time, the others are giving a fraction of the quantity.
{K}.E. Raghunathan, convener of the Consortium of Indian Associations, stated two issues occur within the sector throughout Ayudha Puja — a bonus is given, virtually one-month wage, and a request for wage advance, which is one other one-month wage. The cash given varies from firm to firm and relies on the variety of years an worker has labored.
“Currently, almost 70% of MSMEs have no additional cash left. EMI pressure is quite high. Most of the entrepreneurs paid money during non-working days during the lockdown,” Mr. Raghunathan stated. With no reduction from the State or the Centre, cost of bonus and wage advances are going to be an enormous challenge…,” he added.
The head of an MSME unit in Coimbatore stated he would be capable to give solely 50% of the bonus. Only 60% of his workforce resumed work, whereas the others had been but to return from their respective States. “I’m already paying salaries (a certain amount) to the migrant workers who are yet to return. If I don’t pay, they will not come back,” he stated, including the order influx was but to select up.
“Being a small-scale industry, we want to retain our staff. So we are planning to give 50%-60% bonus,” stated {K}. Baskaran, secretary of the Kakkalur Industrial Estate Manufacturers Association. He stated enterprise was choosing up, however there was an enormous manpower scarcity.
R.G. Chakrapani, secretary of the Thirumazhisai Industrial Estate, stated just some segments had been doing pretty properly. Among them had been two-wheeler, small automobile, tractor-based units. Some had been exporting spill-over orders. “The companies which are catering to these segments are planning to pay 8.33% (one-month salary) in bonus. Other companies are planning to pay 50% of the 8.33% for Deepavali and 50% for Pongal.”
A. Shanmugavelayutham, who runs electrical transformer manufacturing units in Guindy Industrial Estate and Thirumudivakkam, stated, “Many units are wondering how to pay bonus. But I have decided to pay my employees and I’m working on a formula.”
Mr. Shanmugavelayutham stated uncooked materials prices had elevated out of the blue, casting a burden on the sector.
At the Ambattur Industrial Estate, the enterprise is healthier since many units are supplying to the car sector. Orders are coming in for these firms, however funds are getting delayed.
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