Honda Case

2510 WordsJan 19, 201111 Pages
Case Analysis People Management Fiasco In Honda Motorcycles and Scooters India Ltd. Submitted To : Dr. Madhumita Chatterji Submitted by: Swagatika Sarangi People Management Fiasco In HMSI INTRODUCTION: HMSI was established on October 20th 1999 with an aim to produce world class scooters and motorcycles in India. The state of the art HMSI factory, located in Gurgaon, was spread over 52 acres. The initial installed capacity was 100000 scooters per year, which was scheduled to reach 600000 scooters by the end of 2005. A number of issues were confronting Honda Motorcycles and Scooters India Ltd. (HMSI), following the July 2005 altercations with its workers. Honda Motorcycles and Scooters India Ltd. (HMSI), a wholly owned…show more content…
The company also had a policy of paying, in cash, Rs 2100 for the birth of a child (limited to a maximum number of two children) and Rs 3100 on an employee’s marriage. Rs 5000 was given to the employee’s family on his or her death and Rs 3000 on the death of an associate’s spouse, child or parent. The company also met its liabilities under various labor laws. PERFORMANCE APPRAISAL SYSTEM : The performance appraisal system in HMSI included all its employees and the workers are divided into five categories form this grade with increments ranging from Rs 400 to Rs 1400 per month. The company announced all appraisal results and salary-hikes immediately on the end of the fiscal year. No employee was covered by the Payment of Bonus Act, 1961, and as a result the company institutionalized a policy of giving an ex gratia of one month’s pay to every employee as incentive pay around the Diwali festival. WORKS COMMITTEE :The company had constituted a works committee since April 2004 under the Industrial Disputes Act, 1947, consisting of 15 workers and 5 management representatives. The management had also constituted some other committees consisting of workers and management representatives. Some of those were in the canteen committee, the transport committee, the health committee and the sports committee. WORKER’S GRIEVANCES : The workers expressed resentment at receiving Diwali gifts valued at Rs 600 apiece. The

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