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HomeAll NewsMost read newsBusiness Leaders Biography 
Age : 60
Public asset : 65,939,755 USD
Biography : Mary Teresa Barra holds the position of Chairman & Chief Executive Officer at General Motors Co....

Sacked GM workers in India sue company, CEO Barra for unpaid compensation

01/19/2023 | 06:34am EDT
FILE PHOTO: General Motors CEO Barra speaks at news conference in New Delhi  in 2015

NEW DELHI (Reuters) - A union in India has sued General Motors' local unit and its global CEO for failing to pay court-ordered compensation to sacked factory workers, deepening the U.S. automaker's struggles to exit the country years after it shuttered local operations.

GM stopped selling cars in India in 2017 after years of low sales but its complete exit from the market has been marred by complications including legal tussles with workers and failure to find a buyer for a plant in the western state of Maharashtra after talks with China's Great Wall Motor collapsed last year.

GM and the factory workers - who allege illegal termination after the company decided to exit - have been locked in legal battles since 2021. The latest filing signals an escalation in the dispute as workers accuse GM's India unit and its executives, including CEO Mary Barra, of failing to follow court orders.

In a filing to the High Court of Bombay dated Jan 16, the General Motors Employees Union of 1,086 factory workers states the company has failed to pay them compensatory wages of 50% of their monthly salary starting April last year, as ordered by a local industrial court while it continues to hear the dispute, the documents show.

A union leader told Reuters that GM so far owes the workers around 250 million rupees ($3 million) in wages, based on the industrial court's order.

GM did not respond to a request for comment. In its earlier court filings, it has said the industrial court acted beyond its power in ordering the compensation. The company has previously said it has tried to settle the issue amicably and has offered workers a generous severance package.

The union disagreed, and said GM continues to "blatantly violate" the industrial court's order by not paying the workers a single cent. In its latest filing, the union urged the court to hold the company and its executives in contempt, and punish them with imprisonment.

"The workers are unable to feed their families, pay for medical expenses, pay for their children's education," the union said in the filing, which has not previously been reported.

The lawsuit is likely to be heard in the coming days.

India has been a graveyard for some Western carmakers, especially U.S. companies, that have struggled to break the dominance of Japan's Suzuki Motor and South Korea's Hyundai Motor, which together hold a market share of about 60%. Like GM, Ford Motor ceased operations in India in 2021.

GM stopped selling cars in India at the end of 2017 but one of its two factories continued to produce vehicles for export until December 2020. After that, GM ceased all operations and moved to close the plant in Maharashtra, but it has not received permission.

The state government has rejected applications by GM to close the plant - a move that the company has previously said sends a "concerning message" to potential future investors.

(Additional reporting by Aditya Kalra; Editing by Simon Cameron-Moore)

By Aditi Shah and Arpan Chaturvedi

ę Reuters 2023
Stocks mentioned in the article
ChangeLast1st jan.
FORD MOTOR COMPANY 0.31% 11.435 Delayed Quote.-1.81%
GENERAL MOTORS COMPANY -0.59% 33.505 Delayed Quote.0.30%
GREAT WALL MOTOR COMPANY LIMITED -1.61% 9.18 Delayed Quote.-8.17%
GREAT WALL MOTOR COMPANY LIMITED -0.41% 27.03 End-of-day quote.-8.74%
HYUNDAI CORPORATION 0.19% 15740 End-of-day quote.-2.84%
HYUNDAI MOTOR COMPANY 2.56% 180300 End-of-day quote.19.40%
SUZUKI MOTOR CORPORATION 0.19% 4680 Delayed Quote.9.37%

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