The shutdown of the last remaining unit of Atlas Cycles in Sahibabad earlier this week came as shock to its employees, who have threatened protests if it does not reopen soon.
CEO N P Singh Rana said the shutdown is only temporary and the company will resume operations once it is able to raise about Rs 50 crore by selling surplus land.
Till then the company is paying the “lay-off wages” to the workers, who still remain on the rolls. They are required to mark their attendance to get this salary.
While Atlas Cycles says there were 431 employees remaining on the rolls of the cash-starved company, the workers’ union claimed there are about 500 other temporary employees.
According to Mahesh Singh, general secretary of the CITU-affiliated union, the minimum wage at the factory is Rs 13,600 per month.
During the lay-off period, the workers will get half the salary out of which about Rs 2,000 would be deducted towards provident fund and other contributions, according to the union.
The company has not elaborated on the “lay-off wages” but they are typically half of what the employees normally get.
Mahesh Singh said it will be tough for the workers to pay rent for their homes and feed their families with this amount.
Management and union representatives were summoned Friday by the deputy labour commissioner.
“During the conversation, the management assured the workers” union leaders that it will reopen the factory very soon. If the management does not honour its word, the union will stage protests against the factory owners,” Mr Singh said.
Uttar Pradesh Congress leader Narendra Rathi said he will meet Union Finance Minister Nirmala Sitharaman and urge her to help the factory so that its workers “do not die of hunger”.
Local CITU leader Brijesh Singh claimed the shutdown of the Sahibabad factory will also render jobless “several thousand workers” at units from where Atlas outsourced parts for the bicycles.
The unit closed down on June 3.
Mr Singh said all workers gather daily at the gates to mark their attendance so that they get half of their salary during the layoff period.