Companies can't survive by paying people sitting at home: Rajiv Bajaj, MD, Bajaj Auto | Economic Times

Amid social media criticism of Bajaj Auto after Covid cases were reported at one of its facilities, managing director Rajiv Bajaj tells ET that the automaker has the backing of its entire workforce, which appreciates the company’s focus on employee welfare and livelihood protection at a time companies are shedding jobs and slashing wages. Edited excerpts: Every life is precious. How will the management and workers deal with the loss of lives if it recurs?Every life is precious, but you tell us the solution. In Aurangabad, we had very open communication with our people and we have told them what is happening since unlocking - we have seen the cases are going up all over the country. We all know that there is no vaccine in sight. So, if you want to be absolutely safe and you want to sit at home until the vaccine comes, you are welcome to sit at home. But please understand that if we sit at home for one to two years, there is no company in the world that can continue to pay your wages. We will have to implement no work no pay.Our people deeply appreciate that we didn't implement layoffs or even cut wages despite the union voluntarily offering a reduction. They know that we have scrupulously put all precautions in place. They are very appreciative that we distributed homoeopathic remedies free to them, their families and to the community at large. They have let us know that they understand that we can't wish the virus away and are keen that the plant continues functioning.Is there a fear psychosis in the minds of workers to return to work?There is absolutely no such fear, anxiety etc among our people. Because, masses with an open mind understand the facts and figures and are absolutely clear. They understand exactly what is happening.Our people have been coming to work. They have been seeing that there are some cases happening since the sixth of June. They have been seeing that as soon as we see anybody symptomatic, we are isolating, testing and treating them. The authorities have been extremely supportive. They have been doing all the inspection, they have been giving all the inputs and they have clearly said that Bajaj has scrupulously followed all the norms. And it’s not only about Bajaj. I'm sure virtually every industry is at risk. We are all doing the best we can to mitigate that.What other steps can be taken at the factory level?We are taking all the steps. And of course on a daily basis if some improvement comes to our notice naturally we will implement it. If somebody gives us a suggestion, if the collector gives some suggestion, we will do it. But the reality is, my understanding is that today in dense areas like slums, or ghettos etc, the infection rate is probably 40% etc. as happened in the slum next to my house.Secondly, I would say in companies like Bajaj Auto in Aurangabad, 140 cases are just the tip of the iceberg. People are saying, ‘oh! 140 is a large number’. I am saying, ‘no boss it is a small number, only tip of the iceberg’. Because, we have only tested the symptomatic people. I am sure that in any large organization like ours or our competitors or our suppliers, where people are employed in hundreds, 5-10% infection must have already happened. We have 8,000 people in Aurangabad if we test all of them I am sure 400 to 800 will test positive. But fortunately, most of them will be asymptomatic.Will this impact production? Will you look at moving production to Uttarakhand if Waluj worsens? Is that your plan B?There’s no need to move anything anywhere. Because, the problem will be the same everywhere.A few states and cities are again clamping down as cases increase. Assam and Chennai did this. Does this give any confidence to plan production schedules?My problem is that whatever milk has been split is okay, but what about the future? Why Tamil Nadu is still closing down like this for 10 days? Why has Guwahati said it will close for 14 days? Why is West Bengal extending it until 31 July? What will happen on the first of August when you unlock? And to clarify, I am not saying that because of the lockdown, the number of infections or deaths has increased. I am saying whatever was suppressed that time has come out just now. So take the average of both, it is probably going to be what it would have been if this kind of lockdown hadn't been implemented.You were among the very few industrialists to have spoken out against the sweeping lockdown. This has, perhaps, given former CM Devendra Fadnavis and others an opportunity to criticize you….Well, from what I've seen, Mr Fadnavis hasn't named me; so I don't need to say anything to him. The news that our plant was shut isn't true. It's closed on Sundays because that's the weekly off. And it has been closed on some Saturdays since the lockdown started simply due to lack of demand. However, even on Saturdays, export packing and dispatches continue as do maintenance and sanitation activities.If any politician has a different perspective on what has happened at Aurangabad, I invite him to engage with us meaningfully; no productive purpose is served by making baseless allegations in public.How do you know when and whom to test?It is only when people have a slight cold or cough or temperature or something that you isolate and test them. After that, some may come positive; some will come negative. Those who come negative also anyway take a little rest at home for a few days and come back to work, while those that are positive will have to go to the hospital. Therefore, we have followed whatever is needed to be followed and there is no question of not identifying. We have identified 140 cases. Perhaps, what is happening in some companies is that if a person has got a mild cold or cough or something, they are not testing them. They just send them home. And most people anyway become okay in 4-5 days. So, that is why in many companies the infected cases may seem small because they are not testing. In our company, even at a hint of any symptom, we are immediately testing.Does it mean no amount of precaution will stop this virus?Two things we have to logically consider. The first is that within that containment zone, suppose 1,000 people are living there, are you telling me that those people are not meeting each other? Of course, they are meeting each other. Because after all, how do they get their daily provisions? After all, they are human beings. After 3 months of lockdown, these people are emotionally and economically wrecked. How can you tell them that you sit only within your little square foot? So, they are meeting each other. So first of all, they are continuously transmitting within the containment zone also.Let me give you an example from your own publication, The Times of India, about two weeks ago. It carried the news article of a slum called Ghatge Maharaj slum, which is 200 meters from my house. Monday I was going there in my car, I found that the road is blocked. I can't take my car there because everybody was on the road. I asked why? They said because the authorities have come to do 100% testing. What did they find out? They found out that of about 1200 people, almost 500 people were infected. The infection rate is 40% in such places.And the second problem is that the people living in the hotspot or containment zone are meeting each other because it is not practical not to meet each other. Also, the reality is that ultimately when you unlock, they are also going to meet the people who are living outside the containment zone. Where anyway the infection is there, which is 2%, 3%, 5% whatever. So once again, those who are outside the containment zone will give the virus to those who are inside. And those who are inside, since they can live in those dense circumstances, again the rapid spread will happen.The collector has asked people with co-morbidities to stay at home. How will companies identify?We have an annual medical check-up program so everybody’s health is well known to us. We have to secure those who are severely ill in one respect or the other.Does it mean that no amount of precautions will stop the spread of the novel Coronavirus?Ultimately what happens is that..Suppose you are living in your house with your family and you are going to work. Suddenly on a particular day, you find your wife and kids are okay, your parents are okay, your colleagues are okay but you have caught a cold. How does that work? Because on that day, maybe because of some mental reason or some physical fatigue, maybe you didn't sleep properly, your immunity is low and you become vulnerable.Whose immunity will be low on a particular day, nobody can say. A medical checkup will be done once a year, not every day. So it is just bad luck that somebody who is in stress on a particular day falls sick. Do you see demand returning?As far as demand is concerned, I have been saying very clearly that suppressed demand is coming back right now. However, I don't see any fundamental green shoots for now.So the reality is if we do simple math, suppose there was a time over a year and a half back when demand was a hundred units a month. Then we know that, as I've been saying because of the liquidity problem and because of the prices going up due to insurance and ABS etc, as it is well known that before coronavirus the demand had fallen from 100 to, say, 90. The industry was already having degrowth. Now, for two months, from 24 March until the end of May, naturally people could not purchase anything. That means for two months about 180 people could not buy their scooter or motorcycle. In India 99% of scooter and motorcycles are not bought for lifestyle, they are bought to earn daily bread. It is not a luxury, it is a necessity.What does that mean? That means that these 180 people that did not buy are probably going to buy something over the next six months. Because ultimately they have to get a vehicle so they can commute to work. So this 180 divided by six months will translate to something like 30 per month, whereas the normal demand which has come to 90, let's say it will fall further to maybe 80 or 70. Because some people lost their jobs, some people got a salary cut, some people are simply scared, whatever it is. So the demand has actually fallen to 70 but to that, we have to add 30 of the previous two months, so it is going to come back to 100. Now based on that people are saying, oh we're actually seeing growth. It is nothing, just as the suppressed infection will average out suppressed demand will also average out.