Original URL: http://www.theregister.co.uk/2014/04/14/nokia_chennai_plant_voluntary_redundancy/

Nokia offers 'voluntary retirement' to 6,000+ Indian employees

India's 'predictability and stability' cited as mobe-maker's tax payment deadline nears

By Phil Muncaster

Posted in Business, 14th April 2014 06:02 GMT

Nokia has decided to allow an unspecified number of employees at its massive Chennai plant take voluntary retirement (VRS), as it battles local tax authorities and an April 30 deadline for transferring the factory to Microsoft.

The Finnish handset maker issued the following statement on Friday, seen by PTI:

As a global company, Nokia regularly reviews its manufacturing strategy to optimise and ensure smooth and timely delivery of its products. This process considers many factors, including the predictability and stability of the regulatory environment in the countries where the company operates.

Following such a review, we can confirm we have launched a voluntary package (VRS) at our Chennai, India facility.

Further complicating matters, the Indian government in March demanded Nokia pay Rs.35 billion ($572.5m, £342.4m) as a guarantee for tax it says the ailing smartphone maker owes.

Although Nokia has not agreed to this demand as yet, failure to do so would likely render it unable to hand over the Chennai plant to Microsoft before an end-of-April deadline which is part of its M&A deal with Redmond.

The factory has over 6,000 employees, making it one of Nokia’s largest global facilities. It is not, however, one of Nokia's happiest: around 2,000 staff went on a one-day hunger strike two weeks ago to demand greater job security.

It doesn’t look like those efforts were fruitful.

Nokia hasn’t put a number on how many staff it’s looking to offload via VRS, claiming “all employees coming forward are entitled to the package”.

“As a responsible employer, Nokia is offering a clear financial option for interested factory employees,” it added. ®