Minimum wages for petrol pump employees stayed; oil firms suffer setback

The tussle between auto fuel dealers and the government over minimum wages for over one million petrol pump staff has intensified with the dealers getting stay orders from Ernakulam and Jammu high courts among others.

On August 4, the government made it mandatory for retail outlets to pay Central minimum wages to retail outlet attendants. Following this, dealers in 12 states appealed to their respective high courts. Stay orders have been issued by several courts including Ernakulam and Jammu. According to a source, though oil marketing companies like Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) had approached the Supreme Court seeking to transfer all such petitions to the apex court in New Delhi, the plea was rejected.

"As per the new guidelines, we will have to pay between Rs 14,000-15,000 per employee compared to around Rs 9,000-10,000 now. However, the government is not ready to divulge the break-up of the recent increase in dealer commission, while saying that salary part is included in that," said a senior office-bearer from the Consortium of India Petroleum Dealers.

OMCs had increased the dealer margins by 55 per cent through a formula allocating higher commission per litre to outlets having low sales volume on August 1 and which also included ensuring minimum wages for employees.

The government also notified that salaries of employees should be credited to their bank accounts. Besides, the number of employees has been specified according to the sale volume. Outlets with more than 170 kilolitres monthly sales should employ 16 people.

The companies, however, state that majority of retail outlets of state-run OMCs are complying with the new norms. Associations are of the view that there should be some a pass-through mechanism for this. Dealers are also of the view that the compliance of new guidelines, which also includes cleanliness standards and digitalisation, may not be easy across the country.

Hindustan Petroleum Corporation Ltd.(HPCL)

Indian Oil Corporation