L&T sacks 100,000 due to note ban, says Rahul Gandhi

Company annual reports show contract workers' number down by 110,000

Congress Vice-President Rahul Gandhi on Thursday shocked Corporate India by claiming that construction and engineering giant Larsen & Toubro had sacked 100,000 people due to demonetisation.

In its September quarter results, L&T had announced it had removed 14,000 employees since April. The company declined to confirm or deny the sacking of 100,000 people.  

Yet according to L&T’s 2016 annual report, the number of its contract workers is down by 110,000 while its permanent employees have declined by 700 people to 43,354.

Analysts said as orders from large infrastructure projects were drying up, construction companies were shedding contract workers. These are usually low-skilled workers hired when a project is under construction and laid off once it is completed.

Earlier this year, L&T Infotech was in the news for withdrawing job offers to 1,500 students in Tamil Nadu and Karnataka, leading to a hunger strike by students. Reductions in the workforce by companies would be a setback for the Narendra Modi government, which came to power promising jobs for the poor, analysts said. 

When contacted, L&T said its manpower resources were a blend of permanent employees and contract workers engaged for specific projects. “Our structure is designed to give us the flexibility to ramp up manpower. In the last year, the L&T group hired 15,000 employees and expects to rapidly increase its manpower. We have also hired 4,200 trainees across the group,” the company said. 

L&T said realigning manpower with market needs require retraining employees to ensure their skills remained relevant. It added it had trained 68,600 professionals countrywide and many of them had found employment in the group.

“L&T remains on a healthy growth path and with continued operational agility supported by a flexible talent pool the management is confident of its future growth prospects and market leadership in all its businesses,” said SN Subrahmanyan, deputy managing director and president, L&T.