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Wage board: Newspaper industry reels under SC ruling, calls it economically unviable

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Wage board: Newspaper industry reels under SC ruling, calls it economically unviable

Already battered by the latest Indian readership findings and tough economic conditions, the print industry now faces the Supreme Court’s ruling that asks newspapers and news agencies to implement the recommendations of the Majithia Wage Board, which means newspapers and news agencies will now have to pay their employees the revised pay scale with arrears from November 2011. Furthermore, the employees will also be paid revised wages from April 2014 onwards, as per the Supreme Court’s decision.

Newspapers and news agencies have been contesting the validity of the Act, which was rejected by Chief Justice P Sathasivam and Justices Ranjan Gogoi and SK Singh.

When contacted, Mohit Jain, Executive President, Supply Chain, BCCL said, “We have already published our views in the Saturday, February 8, 2014 Delhi edition of The Times of India.” The paper had published a quarter-page report on Supreme Court’s decision under ‘Times View’, stating, “The Supreme Court judgment will deal large sections of the print media a grievous body blow and will financially weaken even the few strong companies that are left in an industry that worldwide is under crushing pressure, with its very existence in question.”

The article further stated, “Even more shocking is that this is the only industry in India where wages are fixed for an organized industry by a centrally-constituted outside body, and where the terms and conditions of employment make it difficult for managements to weed out even the most inefficient and unproductive workers. Every survey in the world has shown that labour inflexibility actually hurts creation of jobs – employers are wary of hiring even in boom time if they are not allowed to trim the workforce in a downturn. A flexible labour market, on the other hand, gives employers the confidence to add staff when a company, industry or market is expanding.”

In a joint statement issued on Friday, February 7, 2014, Sujata Madhok, President, Delhi Union of Journalists and Rajkumar, Secretary, Delhi Press Unity Centre said, “It is a singular irony that the Bennett Coleman & Co, the biggest newspaper group with enormous revenues at its command, refuses to pay employees the wages recommended by a tripartite Wage Board, which included representatives of the newspaper industry. The newspaper owners, despite being party to the Wage Board and its 2011 award, challenged that award in court, thus further stalling revision of pay for over two years.”

Zaheeruddin Ali Khan, Managing Editor, The Siasat Daily remarked, “It is a deadly blow to the entire newspaper industry, which is already going through a bad time, and on top of it the Supreme Court’s judgement will impact the industry as a whole. WAN’s report states that newspapers are here to stay till 2037, but with the ongoing increase in the usage of other media such as online, television, radio, OOH, and with the ongoing problems that the newspaper industry has been facing, I wonder how many of them will sustain.”

His sentiments are echoed by Kurian Abraham, Editor & MD, Dhanam, who said, “The decision is good, but it is difficult to implement. After all, how much can a newspaper afford? We are talking about a liberalised economy, where everything is market driven. However, in the present scenario, most of the print and television players are in a difficult situation. So, this initiative could be a well thought one for later, but not now. Implementation of this could see good and meaningful players exit from the business.”

While the decision seems to spell trouble for the newspaper industry, the question remains is how bad is the blow? Will it actually translate into the exit of valuable players? KRP Reddy, Director - Advertising & Marketing, Sakshi shared, “We will have to restructure the entire wage bill, which is not that easy. I think the industry has to get together and take a decision on this and also go along with the INS. Because at the end, this recommendation is economically not viable. May be starting next week we will be able to speak clearly on this.”

All other leading newspapers declined to comment on Supreme Court’s decision.

With inputs from Deepa Balasubramanian

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