The ASIAN PAINTS paint plant at BHANDUP had caught fire and all the four floors were destroyed.
The major problem of ASIAN PAINTS was to reconstruct a factory at the same place and to overcome this problem.
The applied to the government for reconstruction of a plant at the same place but government replied that it was unsafe to build a factory at same place because workmen’s & people residing near by would be at stake unless new technology was used .So, company decided to bring new technology & build factory. During the course of new construction, the company had to remove workers so that new technology is cost effective ,which was the second dimension to the major problem .Another dimension was to pay them salaries during the reconstruction period .
After meeting with the employees union, a VOLUTARY RETIREMENT SCHEME (VRS) formula was introduced. This formula provided salary to all employees for one year after construction period whether they take VRS or not .Out of the 450 workers 200 came forward after good amount of persuasion & took VRS .So the problem was solved amicably without any problem.
Although the company had to shell out lot of money this was possible because the company’s finance were very strong.