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Last Updated : Jun 23, 2020 07:42 PM IST | Source:

COVID-19 impact: India Inc's sanitation costs jump by up to 25%

But it's a small price to pay to ensure business continuity, say industry leaders.

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All hell broke loose at the manufacturing facility of a mobile major, situated near Delhi, after one of the employees tested positive for COVID-19. Not just that it meant all the employees had to be screened, but the facility itself had to close down for fumigation.

Chastised by the loss in production, the company laid down an even more stringent protocol to follow the SoPs that the government had announced.

A similar incident occurred at Bombay High, where ONGC's offshore oilfield is located, about 160km off the coast. A Business Standard report said that 54 employees working at the oilfield tested positive. While the company claimed that it has been following the SoPs, employees alleged that the infection was spreading 'due to lack of proper guidelines,' added the report.


These are incidents that companies want to avoid, as they ramp up production after resuming operations post the national lockdown.  All of them have already lost crucial man-days because of the lockdown that lasted from the last week of March until May. And that is why, nearly all of them have doubled down their focus on the SoPs, which focus on two critical factors - social distancing and maintaining hygiene.

"Safety has become a big part of a company's focus. We have seen companies spending up to 25 percent more in keeping their facilities clean and hygienic," says Rituraj Sinha, Group Managing Director of SIS, the country's second-largest facilities management company.

This means not only are the companies obsessed with the kind of chemicals and machines used for cleaning, but also want cleaning to be done more frequently. "Earlier, companies were fine with a mop and bucket. Now they ask what chemicals are being used and if these are harmful. Some even ask for organic disinfectants," adds Sinha. Work stations are now cleaned up to three times a day, from just once earlier.

All these add to the costs. At Maruti Suzuki for instance, the safety protocol is actually reducing the effective working time of a shift and decreases productivity.

“The requirement of a one-hour gap between shifts also creates certain issues. We had to virtually double the transport to get the same number of people into the factory. Various things are being tried out so that productivity can gradually increase," said Chairman  RC Bhargava.

At DHL Express, the largest courier service provider in the country, the expenses have gone up by 10 to 15 percent. "But this is essential for business continuity," says RS Subramanian, Senior Vice President and Managing Director, DHL Express India.

Surely, a small price to pay to ensure the safety of employees, and minimise loss of working days.

Liability of the employer

Appliance makers told Moneycontrol that each of them has set aside at least Rs 40 crore on an average to adhere to the standard operating protocols.

The Ministry of Home Affairs (MHA) had on April 15 released a set of guidelines for workplaces that resume operations amidst the coronavirus outbreak. Here, thermal screening, regular sanitisation of the office premises and adequate social distancing were made mandatory.

The human resource head of an electrical goods maker told Moneycontrol that while the MHA hasn’t explicitly stated it, the liability of employee health falls on the company.

“If an employee contracts COVID-19 through exposure to the virus at the workplace, he/she can legally sue the firm. Hence, we need to be extra cautious and pace out work shifts in such a way that there is no crowding,” he added.

Getting masks, gloves and additional sanitisation equipment would also cost additional money to companies. While regular cleaning is a practice across corporate offices, MHA guidelines also seek firms to sanitise the workplace between shifts.

This would require additional manpower being employed for this purpose on one hand, while on the other companies would also need to bear the cost of masks, gloves and protection equipment for the house-keeping staff.

For manufacturing facilities of white goods firms that have at least 300-600 people working two shifts, it is estimated that at least Rs 500 per person would be spent additionally on employees for buying them masks and gloves suitable for the workplace.

Production delays would cost the industry as high as Rs 80 crore, said the chief executive of a consumer durables firm.

“If we give staggered 30-40 minute lunch breaks for the staff, that will have a direct impact on the actual production hours in a week. We cannot increase the working hours because workers will complain and machine overheating would disrupt production. Hence, refilling the supply chain would also cost higher,” he added.

Thermal screeners would also need to be installed across all entry and exit points, especially at manufacturing facilities. These devices are priced in the range of Rs 30,000 to Rs 80,000 and would add an additional cost to the operating expenses of companies.  

While this additional cost may pinch during a slowdown, companies now have understood the need for better sanitation which will become a permanent feature.

With inputs from Prince Mathews Thomas, M Saraswathy and Swaraj Baggonkar.
First Published on Jun 23, 2020 06:19 pm