Tata's Jaguar Land Rover seeks to delay salaries
02 July 2009
Workers at UK's cash-strapped Jaguar Land Rover, now owned by Tata Motor Co, have been asked to accept a 15-day delay in salary payments starting from August. Staff who agree to the revised salary date will get a one-off £200 payment.
A JLR spokesperson said this offer will apply to nearly 6,000 of its 14,500 employees who are categorised as salaried employees. The rest of the workers are paid weekly. He further said 25 per cent of those to whom this offer was made have already accepted it.
Last week, Tata Motors - which purchased JLR from Ford Motor Co in 2008 - warned it may have to cut more jobs after the carmaker reported a £280 million 10-month loss. The JLR spokesperson said that the organisation needed to "realign its pay structure".
A company statement said, ''This should be taken in the context of a number of actions being taken across the organisation to streamline operations, and as another example of our ongoing policy of working with employees on change. Much effort has gone into minimising any short-term inconvenience for employees ... (and) over 25 per cent of affected employees accepted the proposal in the first 48 hours.''
Works Management, a manufacturing sector publication, reported that the firm had recently negotiated extended payment terms with its suppliers, moving them from 45-day to 60-day terms. However the 15-day extension means that supplier payments would clash with salary day, prompting the change.
This development comes at a time when JLR has been facing several challenges affecting its day to day operations, including a delay in securing the UK government's guarantee for a £340 million ''green loan'' approved by the Luxembourg-based European Investment Bank (EIB) in April.