The country’s largest coal miner, Coal India, said it is hoping to conclude the eleventh version of the national coal wage agreement (NCWA-XI), within a month.
In a statement on May 10, the company said the next round of talks are scheduled on May 19.
CIL’s March-23 quarter earnings took a hit over provisioning for wages. “Pending conclusion an upfront wage cost was provisioned in the accounts every quarter since July 1, 2021, the date of commencement of NCWA-XI. This had a telling effect on CIL’s profit after tax (PAT) in the fourth quarter,” the company said in its statement, adding that excluding the provision on wage cost due to NCWA-XI, CIL’s Q4 PAT during FY23 would have been around Rs 9,920 crore, an all-time high.
Of the total provision of Rs 8,153 crore charged to profit and loss account on
account of wage revision during FY23, the last quarter alone took up 72 percent at Rs 5,870 crore, the company added.
The provisioning, CIL said, was necessitated because the company inked a memorandum of understanding under the wage pact recommending 19 percent minimum guaranteed benefit during the March-23 ended quarter.
CIL also, said, the company is yet to come to an agreement with the employee unions over other allowances, but is hopeful an agreement between the company’s management and the unions at the earliest would ease the pressure.
CIL also added, the company’s bottom line in the ensuing quarters would be steady with no provisions required in the accounts.
Analysts with Axis Securities in a May 8 report said, “CIL on Jan 4, negotiated a wage hike of 19 percent Minimum Guaranteed Benefit (MGB) for National Coal Wage Agreement (NCWA)-XI with trade unions. The wage hike will be effective from 1st July’21 on emoluments (i.e. Basic, Variable dearness allowance, special dearness allowance and Attendance Bonus) as of 30th June 2021, the NCWA-XI will be valid for 5 years for nonexecutive workers.” The report said CIL drove a good bargain on wage negotiations to settle at a 19 percent wage hike for non-executive employees (against the demand of 28 percent and NCWA-X at 20 percent).
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