Altamas Petroleum Limited is one of the largest private petroleum marketing of the country with its head office located in New Delhi. It has six refining units (Altamas Mumbai, Altamas Vizag, Altamas Haldia - West Bengal, Altamas Paradip - Odhisa and Altamas Bhatinda - Punjab) across the country. Before 2010, Altamas Petroleum Limited enjoyed monopoly status in absence of any serious competitor. But the emergence of new multinational petroleum companies in Indian market and soaring crude price in international market, corroded its profit severely.
To salvage itself from the threat posed by the new companies and volatility of the market, Altamas Management decided to modernise all its units. Corporate HR recruited 2500 Trainees (Diploma Engineers - Non executive cadre) and posted them to its various units.
Altamas - Vizag received 650 trainees for its modernisation programme. Their training period was of two years following which they were to be absorbed into regular grade (S-3). During training period, trainees were entitled for consolidated pay. Actual benefits were to be entitled only after completion of training period. Newly recruited trainees were asked to report to company's auditorium for joining formalities and subsequent induction programme. Trainees were full of enthusiasm and pride as they had joined one of the best petroleum company of the country. Since the company did not have the hostels for non - executives, the trainees were provided with shared accommodation in company's quarters. Four trainees were made to share single quarter. Their enthusiasm came crashing down when they found their quarters in dilapidated condition. Doors and windows were broken and some of the electrical points were not working. Rooms were without any chair, table, cots/beds, and curtains. There was no arrangement for cooking in the quarters. Company did not have any canteen in its residential campus. So the trainees had to depend upon the nearby hotels and restaurants. Trainees had to arrange their own transportation as the company did not provide any transport from its residential campus to plant.
After Induction and plant familiarisation, trainees were to be posted in different departments of the plant. GM (Personnel) Anshul Verma called all the trainees to auditorium for pre posting communication.
GM (Personnel) - Friends hope you enjoyed your induction and plant familiarisation training.
Trainees - Yes, we enjoyed it like anything. It was beautifully designed.
GM (Personnel) - Any Suggestions to improve the induction training programme. Any other suggestions/concern/issues apart from this?
Trainee (X) - Sir, on behalf of all the trainees, I would like to say something.
GM (Personnel) - Sure, go ahead.
Trainee (X) - Sir, when executives (graduate Engineer & MBAs) join this company (Altams Vizag) they are provided with hostels with fully furnished rooms and canteen facilities. But we have been denied similar facilities. Why such step mother treatment with us, just because we are non-executives employees?
GM (Personnel) - Friends your grievance is quite obvious. Had I been in your place, my reaction would have been the same. I would like to tell you that your batch mates in other units are staying in hostels with canteen facilities. Only the trainees at Vizag unit have problems as far as their lodging and boarding is concerned. Before, Vizag Unit came into Altamas fold in 2002, it belonged to Govt. of India. Till 1995, Vizag unit had never recruited non-executives as there was ward quota here. In case of death, accident or superannuation of employees, their ward used to be absorbed by the company in non-executive positions. Only the executives (graduate engineers and MBAs) used to be recruited by this unit. So there was no need felt to construct hostels for non-executives as a major chunk of them were locals.
I have instructed DGM (Town Services) to carry out the repair work of your quarters on war footing level. The budget for creating new facilities and repair work is limited because of financial constraint resulting from recent loss and current expansion programme. However, I have requested the CEO to provide some more fund.
Trainee (X) - Thanks for your assurance. We are quite optimistic that things will improve fast.
GM (Personnel) - Thank you all for your cooperation.
GM (Personnel) was happy as he was able to convince the non-executives trainees and averted an substantial dissatisfaction in to collective grievance. But he was able to foresee a massive agitation by non-executives in absence of any concrete measures taken by the personnel department. The current crisis had a potential of converting itself into an IR issue and anything similar would add fuel to fire.
Around 5 Pm, GM (Personnel) received a call from corporate office (C.O), New Delhi.
GM (Personnel) - Hello!
CO - Good evening Sir, this is Anusha Singh (Sr. Manager - Personnel). This call is regarding your promotion. Chairman Sir is on the line, he wants to talk to you.
Chairman - Anshul, Congratulations! You have been elevated to position of Head of Personnel, Altamas Petroleum limited. You will be sitting in corporate office. As you must be knowing that we are working on VISION 2025, we need your inputs on personnel aspect. You shall be responsible for designing new personnel policies, new HR initiatives consistent with VISION 2025.
GM (Personnel) - Thank you very much Sir. I am overwhelmed. I will move earth and heaven to stand on your expectations.
Soon after, he was flooded with congratulatory messages. Ranks and file beeline to congratulate him. Next Day, a group of trainees fixed an appointment with GM (Personnel) at latter's office at 3.30 Pm.
Trainees - May we come in Sir.
GM (Personnel) - Yes, please be seated.
Trainees - first of all congratulations for your elevation.
GM (Personnel) - Thank you very much.
Trainees - Sir, Pongal (festival) is round the corner and company gives bonus to all its employees on this occasion. During induction we came to know that trainees are not entitled for bonus. Is it so?
GM (Personnel) - As per the personnel policy, only regular employees are entitled for bonus. You all will be getting bonus once you complete your two years training period.
Trainees - Sir, Altamas Vizag have 3500 employees. Except 400 trainees, all other employees will be getting bonus. Everyone will be celebrating Pongal except us. Don't you think it is injustice and demotivating for us.
GM (Personnel) - I can understand your feelings. But I am helpless. I will try my best, but I can't give you assurance as it is a policy decision taken at corporate level.
Trainees - Ok Sir, we are hopeful that you will do something.
Personnel Department organized a party at officers club to bid farewell to GM (Personnel). When the party was in full swing, GM (Personnel) received a call from GM (Works) only to get informed that the later's office had been gheraoed by the agitating trainees who were demanding bonus. GM (Personnel) rushed to the site along with other personnel officers. He pressed in security guards to avert any untoward incidents. He was perplexed as he had already explained the management's stand to trainees as far as bonus was concerned; by and large they were all convinced. The moment he reached the site, agitation grew stronger. Agitating trainees were shouting slogans against the Management. They burned the effigy of GM (Personnel). For them the main villain was personnel department. More shocking was to find the line managers were also siding with agitating trainees as they viewed their demand rational and genuine. To make matters worse, registered unions joined in the protest of trainees.
When GM (Personnel) tried to pacify the agitated mob, they shouted at him "you have betrayed your young trainees who are the future of this organization". "The other five units of Altams have paid bonus to its trainees, then why Altams Vizag denied the same. "Why such discrimination by Mr. GM (Personnel) against trainees"? GM and other personnel officers were shocked to know about the payment of bonus to trainees in other units. He called his counterparts in other units who confirmed him of such payment. Except Altams Vizag, other units recruited trainees every three to four years. Payment of bonus to trainees in other units was based on the local agreement signed between respective Unions and Management. Honouring of local agreements is must for the harmonious Industrial relations.
The situation became hostile. Personnel department was totally isolated. The agitators refused to budge. GM (Works) remained ghearaoed and production was affected severely. GM (Personnel) was in a fix as there was no such local agreement in Altamas Vizag and corporate policy did not allow bonus payment to trainees. Pressure was continuously mounting on him to resolve the crisis.
What went wrong in Altamas Vizag?
Had you been the GM (Personnel), how you would have resolved the current crisis.
What steps would you have taken, if you were Head of Personnel, Altamas Petroleum Limited, to avoid such incidents?