Coal India Unions Seek 50% Rise In Salaries, Could Mean Costlier Coal

A 50% wage boost would be a dramatic increase for Coal India, which revises salaries of non-executive staff every five years.

Trade unions at Coal India Ltd., the world's largest miner of the fuel, have demanded a 50% increase in workers' wages, potentially pushing up costs of the fuel that helps produce more than two-thirds of India's electricity. The demand is backed by expectations for rising profits in coming years amid a reduction in staffing and plans to increase production, said D.D. Ramanandan, secretary at the Centre of Indian Trade Unions, one of the associations active in Coal India. The unions had their first meeting with management last month to discuss the matter and more meetings will be held before they reach a decision, he said in a phone interview. A 50% wage boost would be a dramatic increase for Coal India, which revises salaries of non-executive staff every five years. Previous negotiations have typically led to 20% to 25% increases. Coal India declined to comment on the demand, saying the talks are still at a nascent stage and it's looking for a "win-win situation for both sides." The unions' position may be a bargaining tactic. But any hefty wage increase would resonate across India's energy sector and its broader economy. To offset the impending rise in expenses, the state-run miner is considering increasing prices of coal it sells in long-term contracts, which will drive costs through an economy already battling high inflation.