State-run Coal India (CIL) announced on 1 February 2012 its decision to increase wages by 25%, which would put an additional burden of Rs 6,500 crore on the public sector unit. The hike is to benefit over 3.7 lakh workers of the world's largest coal producer.
An agreement was signed between its trade unions and CIL management for increase in the wages under which minimum guaranteed benefit would be 25% of gross as on 30 June 2011. The National Coal Wage Agreement was signed and will be of five years tenure with effect from 1 July 2011. Increase in basic would be 88 per cent, which will be reflected in all fixed allowances. As per the new pact, the house rent allowance in non-urban areas would be two per cent of basic per month instead of fixed amount of Rs 150 a month.
The management also agreed to provide special allowance to all workers as substitute of perks to executives which will be four per cent of the basic per month.
CIL and its subsidiaries currently spend around Rs 20000 crore annually on salaries of workers, which is roughly over 40 per cent of the cost of production.
On 13 January 2012, CIL had agreed in principle to increase wages of workers by 25 per cent.
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