Cooperative Employee Relations at North Delhi Power Ltd.

North Delhi Power Ltd (NDPL) was one of the three electricity-distribution companies (also
called the three DISCOMs) that took over the ailing Delhi-Government-owned Delhi Vidyut
Board (DVB) w.e.f. July 1, 2002. While 49 per cent shares in NDPL were held by the Delhi
Government, the company was actually controlled by the Tata Group as it held 51 per cent shares
in it. NDPL catered to North and North-West Delhi. BSES, a Reliance-group company which
owned the other two companies, catered to the rest of Delhi as per the privatization arrangement.
A Joint Action Committee consisting of members from the two existing unions, both of which
were recognized by the DVB, signed the Tripartite Takeover Agreement that was devised at the
instance of the Delhi Government. These two unions were: the Delhi State Electricity Workers’
Union (DSEWU), which was an INTUC-affiliated union; and the Delhi State Electricity
Employees’ Union (DSEEU), which was independent, but in actuality was led by a former
dissident from the INTUC union, Harish Rawat. These two unions were common for all the three
DISCOMs. After the takeover, NDPL recognized only the majority union i.e. DSEWU. The
support of the non-recognized union (DSEEU) had gradually declined after the takeover.

The CEO of NDPL, Anil Sardana, was seen by this company’s managerial and supervisory
personnel as a change master and charismatic leader. Most of the other members of the NDPL
fraternity had an impression of him as passionate, visionary, transparent and ethics-driven in his
transformational role. While interacting with the employees after the takeover, he heard an
official, V.K. Saxena, in a meeting complaining of inadequate training that employees possessed,
he immediately appointed Saxena as in-charge of the training function; since then he had been
working as training manager in NDPL.

Before the takeover, DVB was in complete red, having accumulated huge losses over the years.
Like most other state electricity boards in India, its AT&C (Aggregate Technical and
Commercial) losses had reached 53 per cent when the takeover was effected (The AT&C number
measures the difference between kwhs supplied to the distribution company and kwhs realized
from retail customers). As a result of the high AT&C losses, the Delhi Government had to
subsidize DVB to the tune of Rs. 1500 crore per year.

DVB meter readers were hand-in-glove with power thieves and advised them on how to give a
gloss of legality to power theft. Especially the big power thieves, who were mostly industrialists
and similar establishments, were in connivance with other DVB personnel and even Delhi
politicians. DVB employees, who enjoyed immunity for their misdemeanors, had built temples
inside the corridors and premises of most DVB offices. This was done with a view to preventing
the angry public from attacking and damaging the premises when power breakdowns were not
attended within a reasonable time. The incidence of corruption amongst DVB employees, in
general, was very high.

Apart from stopping power theft, improving the power situation and enhancing customer
satisfaction were some of the key issues that Sardana saw as major challenges. On takeover, he
suggested to Abhay Saini, NDPL’s the then HR chief, that “the company should begin its change
and transformational agenda with an enquiry into the assets held by the meter readers.” To this
Saini suggested that “they should focus themselves more on future rather than the past.” He
opined that “the company’s role vis a vis the employees should involve making efforts to bring
the DVB-scheme employees into the core values of NDPL.” A broad agreement was reached on
this strategy.

NDPL soon devised its vision of “becoming the most preferred and admired energy company.”
As per the tripartite agreement, the three DISCOMs were to reduce the AT&C losses from 53 per
cent at the time of acquisition to 20 per cent by 30 June 2007. Under Sardana’s leadership, the
HR department designed and implemented several interventions towards this end. Saini and his
HR department also worked very hard to articulate and implement an appropriate HR strategy for
the company in consonance with the core values of the Tatas. Some of the HR interventions used
included: performance management, need-based training, innovative welfare measures, role
clarity through key result areas (KRAs) and job descriptions (JDs), proactive grievance redressal
mechanism, human resource information system (HRIS), and the joint interaction forum (JIF).

RIGHTSIZING AND REORGANIZATION

As per the tripartite agreement, NDPL inherited 5368 employees from the DVB. It devised an
attractive voluntary retirement scheme (VRS). Out of the total DVB workforce, 1794 employees
sought retirement under the VRS. This included 90 per cent of the meter readers. The company
gave option to the former DVB employees to move to the new scheme (called the NDPL
scheme). But only 16 employees opted for this switchover. The recognized union was involved
in the rightsizing process throughout, even as the common worker remained continuously
apprehensive. The DVB-scheme employees continued to be governed by the old DVB-pay-
structure including payment of dearness allowance (DA) and pension benefits as per the Fifth
Pay Commission as applicable to Central Government employees. NDPL employed 600 new
employees (hereinafter called NDPL-scheme employee) over a period of three years to various
positions with new service conditions. This included about 400 engineers to facilitate the
operations and maintenance work, and 20 fresh or experienced MBAs in different functional
areas. These employees were not unionized. Their compensation packages were much higher, as
is generally the case in the private sector. Lately, this had caused a good bit of problems in the
working of the company. There appeared a clear class difference between the two classes of
employees.

The company undertook reorganization too. It had inherited a chaotic DVB structure. DVB had
some 150 employees in its personnel department who were mainly handling employees’ service
files, and their salary and benefits-related matters. There was no training department. Most
employees had never seen a training hall. NDPL replaced it with its HR department, which got
into action for rationalizing HR procedures, manuals and policies. The vision devised for the HR
department was “to create a learning organization which nurtures talent and innovation, and
provides competitive environment that makes NDPL the most favoured company to work for.”
After considerable efforts, the HRIS was installed. The company oriented the organization
structure to the needs of the customer. It increased the number of circles from 2 to 5; districts
from 10 to 12; and zones from 40 to 46. It re-defined the structure to ensure the company’s 24
hour accountability to the consumer.

The HR department undertook a massive task of writing the job descriptions (JDs) and key
result areas (KRAs) for different positions to promote role clarity. Also, almost all designations,
which smacked of hierarchy consciousness, were re-christened. Thus the designations like
executive engineer, assistant engineer, superintendent, inspector, etc. were changed. The new
designations were manager, assistant manager, office associate, work attendant, and so on. Re-
designation aroused considerable resistance from most DVB-scheme employees including senior
officers. Most of them had not reconciled to this reality even till date. On the contrary, some of
them felt empowered e.g. when stenographers and daftaries were re-designated as office
associates, they felt excited. All meter readers who did not opt for VRS were re-deployed to
undertake other functions.

EFFORTS AT CHANGE OF MINDSETS AND BEHAVIOURS

As NDPL proceeded to implement its transformational agenda, it wanted the employees to be

oriented to performance excellence and customer satisfaction. The company also had in mind
promotion of Tata culture through adoption of Tata Business Excellence Model (TBEM).
 Immediately on takeover, the first major issue was the mode of salary payment. DVB was
paying salary to most operative and supervisory cadres in cash. Matters relating to salary-
payment used to stagger over more than a week and the issue was seen as one of the key triggers
of manpower wastage. The salary register was a 2 feet wide manual, requiring diligent entry,
which was often not handled to the satisfaction of the employees. Every month there were 500 to
700 errors in it. Several employees were absent from duty all these days, on the excuses related
to involvement in salary payment. The company wanted the salary to be disbursed through
electronic transfer to bank. But especially the lower cadre semi-literate employees had a lot of
apprehension regarding bank transactions. They resisted the new move. Slogans were raised
against the management; the union officials joined them half-heartedly. The company kept two
retainer-consultants, Mr. Jain and Mr. Malhotra, who had recently retired from the DVB as
officers in its personnel department. They were known to have a feel of the employee dynamics
and sensitivities thoroughly well. They were seen counseling the employees on the issue of
electronic transfer of salary, and even would visit their homes and colonies to convince them.
Eventually, the counseling got stronger and the employees relented for an electronic transfer of
salary to bank.

The DVB-scheme employees initially had complete resistance to the computer system;
however, they gradually realized its importance. Comprehensive training was organized to make
them computer savvy. When they became well-versed in handling computers, each manager
brought with him his own PPT presentation in the periodic meetings. A clear sense of
competition amongst zones and districts was visible in the tone and tenor of many presentations.

Since DVB buildings were in bad shape, a massive renovation programme was undertaken
including making most buildings air-conditioned. Employees saw some tangible gains in the
changes made; working became more comfortable. Safe and hygienic conditions were provided
at the workplace. In the first two years, the company made an investment of Rs. 228 crores
against the required Rs.227 crores in buildings and infrastructure improvement including the
grids.

In terms of output, quality of work was very poor, which led to large-scale organization of
quality training. Training for team-building was designed on the basis of brain-storming sessions.
The ultimate goal of each training course was customer satisfaction through reduction in cost of
delivered power, supply of reliable and quality power, and improvement in levels of efficiency
and accountability.

A peer-exchange training program was designed with Baltimore power utility and Columbia
power utility in USA. Later on, in all, 32 people were sent to Sri Lanka, Bangla Desh, Hong
Kong, Spain, Netherlands, and Nepal to learn how things were managed there by electricity
distribution companies. Two batches of union leaders were sent to the Tata Steel plant in
Jamshedpur in September, 2003 for 10 days each to observe how cheapest steel was made in the
world in a climate of harmonious industrial relations among 40,000 employees. A manager
remarked “These leaders now talk more practical and sensible, and have reflected more positive
understanding and cooperation in developing performance culture.” Later, these leaders asked
the GM––HR, “When are you sending us to a foreign country for training?”

Sardana introduced an incentive scheme to promote performance-based culture for

employees. Those who successfully achieved their targets were rewarded with appreciation
certificates and target-compliance mementos. A bi-annual system of communication from CEO
was devised and implemented. Also a “Meet the CEO Scheme” was introduced wherein each
employee could meet the CEO personally and discuss issues and problems related to efficiency
or any grievances. An in-house quarterly company newsletter named Navodaya was launched in
November 2003. The company also started a suggestion scheme, but the employees somehow
showed inertia in making full use of it. It even provided for sharing of gains from the
suggestions. NDPL also had the policy of posting the employees mostly near their home to
ensure that they remained energetic.

EMPLOYEE WELFARE AND GRIEVANCE

Table 1: Some Major Employee Welfare Initiatives Undertaken by NDPL

Pre-takeover August 2005
S.No. Delhi Vidyut Board North Delhi Power Limited
1 Medical claim of indoor patient/ treatment Forty hospitals were empanelled; no payment
was being reimbursed by DVB after the required to be made by the employee
expenditure was incurred by the employee concerned; the employee had to just show the
from his pocket. Identity Card and avail treatment.

2 A Janata Insurance Scheme with a cover
value of Rs. One lakh for accidental
injuries; premium was paid by the
employees.
3 No forum/platform for interaction between
management and employee
representatives.
4 Time-bound Promotion Scale (TBPS) was
being allowed to the eligible employees
after considerable lapse of time. Many
cases since 1994 onwards were pending.
NDPL got every employee insured against
work-related accidents for a cover value of
Rs. 2.5 lakh at company’s cost.
A Joint Interaction Forum (JIF) launched at
the district and circle level; monthly and
quarterly meetings of JIF held.
Time-bound Promotion Scale cases were
updated. All employees who were eligible for
TBPS were allowed the same on 30th June and
31st December every year––No case was
pending.

5 Pathetic working conditions in offices; no A number of buildings renovated; hygienic

cleanliness and hygiene maintenance. conditions maintained.

6 Potable drinking water not available in Proper drinking water available in all
many District/Zonal offices. District/Zonal offices. Water purifiers were
installed or filtered (bottled) water was
provided.

7 No gift was given to employees on any A wrist watch was given to every work
occasion. charge and contractual employee to
commemorate the Raising Day on July 1,
2003.

8. No function was ever held to celebrate the Labour Day was celebrated every year by
Labour Day on May 1. observing Industrial Harmony Week; it
involved employee participation in it.

9 No sports meets ever organized Sports meets for employees and dependants

Along with improving the working conditions, welfare facilities and employee care became
important concerns for the company. Table 1 reveals an overview of some of the welfare
measures undertaken, and compares them with the pre-takeover situation. In addition to the
measures shown in Table 1, regular camps were organized for free health check-ups with
specialists’ facilities. All employees were served tea twice a day or were paid Rs. 125 per month
as tea allowance. A scholarship scheme with the upper limit of scholarship of Rs. 1000 per
month per beneficiary was implemented for meritorious children of employees since July 2003.
Schemes were devised and implemented for providing free coaching and computer training to
children of the employees. The company also conducted English-speaking courses for the
employees’ wives. Diwali mela was organized for all employees and their family members. Eye
camps, health camps, and blood-donation camps were organized to promote social responsibility
amongst employees. The company donated Rs. 5 lakh to an Eye Foundation. It adopted Bawana
village as an SOS village, and paid for books, clothes, toys, etc. for the needy children in this
village.

A “Grievance Handling System” was devised. Employees were encouraged to discuss work-
related grievances or concerns with their managers and use the grievance procedure, the steps in
which went up to the CEO. One of the most unique features of employee care at NDPL was
sarathi, its Employee Helpline for facilitating grievance processing. Any NDPL employee could
submit his/her grievance by e-mail or telephone, and sarathi assisted in giving a time-bound
reply to him/her and also helped in processing the grievance. Sarathi was aggressively marketed
across NDPL through coloured posters to ensure that employees made full use of it. The
grievances mostly related to issues like promotion, posting, error in pay-slip, administration-
related issues, amenities-related issues in employees’ colonies, working conditions in offices,
overtime, shift timings and shift roasters, and other personnel matters. NDPL was perhaps the
first such company in India to have started this kind of a help line. Sardana was particularly
concerned that employees’ grievances get expeditiously resolved.

UNION-HANDLING DYNAMICS

NDPL inherited the DVB workforce along with its two unions and seven staff associations. It,
however, recognized only the Delhi State Electricity Workers’ Union (DSEWU), which was the
majority union, and not the other one. It also did not recognize any of the seven staff
associations. DSEWU’s General Secretary, Hira Lal, and the members of the union executive
were cooperative with the management in the takeover process, and even after. Barring some
minor disturbances, the company had by and large witnessed a peaceful acquisition process.

The employees positively viewed the company’s concern for improvement in working
conditions and orderliness in work organization. People felt better at having been provided
facilities for comfortable work atmosphere. Sardana and Saini also took a positive stand on three
of the burning issues which were of grave concern to the common employee. This was done
partly on advice of Jain and Malhotra, the two NDPL advisors on employee affairs.

Perhaps the most complex of these three issues was the payment of Rs. 10,000 each to 41
employees’ widows, whose husbands had died during service of the DVB. Employees were
concerned that the settlement of these claims should be done from the employee welfare fund set
up by DVB which was now the responsibility of the NDPL. They did not want the money––as
DVB was so asking––to be paid out of the “employee fund” that was purely employees’ money
raised by way of deductions from their salaries. After some days of negotiation, Sardana and
Saini responded positively. They knew it was a question of only Rs. 4 lakh, and agreed to pay it
from the company’s funds. Sardana declared that before going home that day he wanted to sign
those cheques. Jain and Malhotra were in the limelight.

Almost immediately on takeover, Sardana was surrounded by appeals to settle the issue of
uniforms for all workers, the second major issue that was agitating them. DVB had given
uniforms to lower-level workers and white-collar staff up to the junior engineer level. Tempers
were high in the union on this issue. In the DVB era, every year truckloads of uniforms were
procured and employees were suspended for not wearing them. Supplying uniforms to 5400
employees and getting into issues of size, material, quality, distribution and the related
consequences of dissatisfaction with the uniforms had become a controversial issue. The other
option was that the employees could get monetary compensation in lieu of the uniform. Sardana
saw no point in enforcing the wearing of uniforms by the employees. The union agreed for the
allowance. The actual cost of the uniforms was Rs. 1172; the negotiated cost started at Rs. 1700
from HR side, though the management’s negotiation range ended at Rs. 2500. After a series of
negotiations, the entire body of the union along with the HR managers settled it at Rs. 2700,
which was frozen for the next three years.

Promotion was the third most crucial pending issue; no promotion had taken place since 1992.
This was mostly due to lack of funds and the indifferent attitude of DVB officials. Some people
had not had a single promotion for the last 20 years. Saini convinced Sardana about the need to
take a positive stand on the time-bound promotion issue. Sardana, put up the case to the
Government of Delhi and Chief Minister Sheila Dikshit. The Government provided its share of
the funds needed to effect promotions and all 350 cases of time-bound promotions for DVB-
scheme employees were cleared.

Saini had before him 80 cases of employee discipline. Some 63 of these 80 files of employees
involved petty matters. Saini thought, “Why should I harass them for petty issues which do not
bother me?” He transacted with the employees and systematically closed most of the files; only
17 cases of suspension were still open.

Since most interest issues were part of the tripartite takeover agreement, whereby the DVB-
scheme employees had protection of service conditions, there was little role for the union in these
matters. Most of its role however related to matters related to perceived individual and group
grievance as had been the case in the three issues narrated above. The records of NDPL showed
just two demand notices given by the DSEWU. The first one dated May 30, 2003 contained
threat for agitation due to the three grievances listed in it, which included: transfer of union
office-bearers against the tripartite agreement; non-sanction of leave applications of employees;
and harassment to workers who were facing enquiry for alleged misconducts. There was no
concrete demand or allegation in this charter; it appeared merely symbolic of adversarial function
of a union. The second demand charter, submitted on 4 June, 2004 contained ten demands, the
prominent among these included: regularization of work-charge staff; appointments on
compassionate ground; promotion as per the agreement; terminal benefits for the staff who opted
for VRS; and removal of fixed charges for electricity bills from the employees. There was no
involvement of the labour department in the discussion of the demand charter. Union leaders
were pursuing the matters with the management.

The latter demand charter contained two major demands i.e. regularization of work-charge
staff; and the payment of terminal benefits to those who had opted for the VRS. There were 89
employees in the work-charge category. Since their parents/husbands had died while in-DVB
service, the union wanted them to be regularized in the first meeting with the CEO. Sardana
insisted that “they would be taken only if they upgraded their skills.” A special request was made
to an Industrial Training Institute (ITI) to help in the matter. It organized a special 12 to 16
weeks technical training to upgrade skills of these employees at the company’s cost. Many such
employees were inducted at higher salaries. For the graduate employees, NDPL insisted for a
computer test after the computer training. The employees who cleared the test were regularized.
Some employees who wanted to join the clerical grade without the graduate degree were refused.
Some went to Delhi court while the names of four were struck from the rolls of the company.

The payment of retirement benefits to employees for the period for which they had rendered
service to DVB in the pre-takeover phase was another major issue in the demand charter. It was
mainly the responsibility of the Delhi government. After NDPL announced the VRS scheme and
some employees opted for it, retirement dues became payable to them. But the Delhi
Government could not meet its responsibilities of paying the employees’ dues even after more
than two years of privatization. NDPL had offered to pay its share long time back. This aroused
deep resentment among the retired as well as serving employees against the Government.
Employees of all DISCOMs organized agitation and dharnas at Raj Ghat against the attitude of
the Government and the DISCOMs. Interestingly, NDPL management joined them in their
protest against the Delhi Government for undue delay. Saini issued a circular to all employees
that “the raising day would not be celebrated on July 1, 2004 due to non-receipt from the Delhi
Government” of the retirement benefit by 1797 retired employees. He also issued another
circular suggesting that the NDPL fraternity would not celebrate Puja and Diwali festivals in
2004 as a mark of protest against the Delhi Government not releasing the retirement money.
Eventually, Delhi Government agreed to release the money for the VRS-scheme beneficiaries,
and the matter got settled.

Redeployment/downsizing of 160 water women in the DVB-scheme was yet another crucial
issue. These women had been employed by DVB for serving water to employees. They had no
role in the new organization structure. Their re-training potential towards learning any sort of
technical skills was almost negligible. Sardana engaged an NGO to train them in activities such
as pickle-making, papad-making, etc. at company’s cost. The idea, Sardana claimed, was that
they could live a dignified work life and not sit idle. After this training they could engage
themselves in these activities and earn some extra money. The union thought that their vocational
engagement would lead to their re-deployment elsewhere, thus resulting into compulsory
retirement. Sardana clarified that he had no such intention. The union advised the water women
not to participate in this training.

Asked to list major issues on which the union had cooperated with NDPL, Saini enumerated
them as under: re-deployment of manpower; help in building work culture; help in building
cooperation with the common employee; cooperation in new designations; cooperation in settling
uniforms issue; unusual support provided by them in setting up the JIF; and cooperation in
implementing the overall change agenda. He also said, “Union’s cooperation could be gauzed
from the peaceful celebration of the May day. Generally unions show black flags to management
on that day. But we celebrated ‘Industrial Harmony Week’ during that period. In fact, we
organized several activities during that week including promotion of work culture, effecting
need-based transfers, organizing blood-donation camp, slogan competition, and tree plantation.”

THE JOINT INTERACTION FORUM

The company thought of involving the employees in its functioning through Joint Interaction
Forum (JIF) at the district and circle levels. This was an exercise in employee participation in
management. The key objective of JIF was to facilitate better consumer service and enhancing
the consumer delight. Some of the usual issues discussed at this forum included: workplace
hygiene, health, safety, quality, welfare, quality of work, response time, productivity and
maintenance issues, non-availability of basic infrastructure, performance-related issues, inputs
on improvement of processes at various levels, elimination of waste, lowering costs, information
sharing, and skill enhancement of employees through training. It was not meant to discuss any
interest matters such as wages, salary, leave, suspension, dismissal promotions, transfers and any
other service-related issues.

Monthly and quarterly meetings of JIF were held regularly. The case writer attended three
meeting of JIF. One of these was of the central JIF that was held at a place in Haryana 40
kilometers from NDPL’s office, and was preceded by lunch. The two other JIF meetings attended
were of two different districts. The meetings were cordial. Few leaders from the unrecognized
staff associations occasionally made their points which demonstrated some degree of suppressed
dissent on some issues. In a central JIF meeting the secretary of the recognized union made a
PowerPoint presentation titled: “How NDPL Employees Could Contribute towards Greater
Efficiency.” He admired the company for its proactive policies and for sending the union leaders
to Tata Steel at Jamshedpur for obtaining first-hand exposure to situations of union–management
cooperation. In all the three meetings that the case writer attended as an observer, a remarkable
degree of dignified presence could be perceived from the body language of the representatives of
employees as well as the management. The company’s HR consultant, Dr. S. N. Pandey, who
was earlier Director––IR at Tata Steel, was guiding the working of the JIF at NDPL.
RIPPLES IN THE UNION’S RANKS

The last union elections of DSEWU were held five years ago in which Hira Lal became the
general secretary, which was challenged by Harish Rawat in Delhi High Court. The matter was
still pending in the High Court since then. Rawat later formed DSEEU and became its general
secretary; DSEEU was also a recognized union in DVB, and a party to the Tripartite Agreement.
After the takeover, as per the policy of Tatas, NDPL recognized only DSEWU, being the
majority union. Somehow, DSEEU lost the support of rank and file and became marginalized.
Later on, Rawat retired from the service of the BSES company, where he was working after the
takeover. DSEWU elections in future will be held as per the directions of the court.

The thus-far-impressive working of NDPL got marred by some recent events, which had sent
waves of depression amongst its managerial and supervisory staff. In February 2005 Kuldip
Sharma, a clerk in one of the two BSES companies, called a meeting of the general body of the
INTUC-affiliated DSEWU and got himself elected as its General Secretary. Kuldip was a former
loyalist of Hira Lal. He challenged the authority of Hira Lal and other existing union office
bearers. He also became a party to the pending High Court case, contending that he was the real
representative of the employees as he was in control of DSEWU in the three DISCOMs. Kuldip
alleged that Hira Lal group had lost the support of the rank and file, was hand-in-glove with the
NDPL management, and had sacrificed the employees’ interest. This development had caused a
storm in the NDPL circles. The company continued to recognize Hira Lal and his executive
members. It was estimated that about 60 per cent employees were with Kuldip and 40 per cent
with Hira Lal group. Sardana was aware of Kuldip’s strength. Therefore, he instructed his
managers not to ignore Kuldip, who was increasingly becoming powerful.

The Kuldip dynamics had led to many new developments. In September, 2005, Abhay Saini,
GM—HR was transferred as GM—RRG & SPD (Revenue Recovery Group and Single Point
Delivery). A new person, C.N. Naga Kumar was brought from Tata Power in Mumbai on
deputation as GM—HR. While Saini’s strength was believed to be mainly in functional HR and
HR strategy, Kumar had expertise in labour law and industrial relations matters as well. What
had become a cause of serious worry in NDPL circles was the rising incidence of insubordination
and indiscipline. Some cases of assault and heckling of senior officers by supporters of Kuldip
group came to notice from different circle and district offices, but management could not take
any meaningful action against the persons concerned, perhaps due to the fear of a flair up.

Kuldip group became more powerful after the Rehman incident. Rehman was an NDPL-
scheme probationer employee in the corporate head office. One day, Sanjay, a Kuldip loyalist
and a DVB-scheme employee in the same office, provoked Rehman in relation to some official
matter. This led into a brawl in which Sanjay allegedly assaulted Rehman. Consequent to this
incident, he called Kuldip and his other supporters to the office. Some slogan-shouting took place
against the management. Some employees alleged that this show down was pre-planned by
Kuldip loyalists. It also became an issue of DVB-scheme employees versus NDPL-scheme
employees. They went to Sardana’s office and in a heated meeting with him demanded dismissal
of Rehman. Saini was not in the head office, as he was in the field. In the heat of the moment,
Sardana announced dismissal of Rehman. This incident was in a way the coronation of Kuldip’s
kingship.

When asked the possible reasons for the visible signs of dissent in the union’s ranks which led
to the above developments, a DVB-scheme manager, who had an astute understanding of the
employees and union issues in the company, remarked as follows:

No doubt, the general rank-and-file is very happy working for the NDPL, and feels
dignified also. The company has on its own solved all problems of the employees.
Today, the union has run out of agenda. Compensation matters are all governed by the
Tripartite Takeover Agreement. The company unilaterally gives the employees’ due
 before hand. In alignment with the TATA Culture of care and share, for example, the
company has made an ex-gratia payment of one month’s basic salary to all categories of
employees including senior managers, which was linked with organizational
performance. None of the other similar companies including GENCO, TRANSCO (the
two Delhi-government-owned generation and transmission companies, which were also
part of DVB earlier), and the two BSES companies made any such payment. This has led
to higher degree of commitment of the employees. In the sphere of welfare, hardly any
need of the employees has been left unattended. The common employee has largely
changed for the better. Corruption amongst employees has completely ended. The
comparative performance of the company speaks for itself.

But the biggest mistake of ours was the handling of the Kuldip factor. It was wrong to
dismiss Rehman, as he himself was the victim in that episode. We did that because he
was a probationer, and could be made a scapegoat for buying momentary peace for the
company. This issue has revived DVB days of indiscipline in some sense. This has
emboldened Kuldip’s supporters, which has led to greater number of cases of
insubordination. Partly, this matter has also to do with the difference that has got created
between DVB-scheme employee and the NDPL-scheme employee. NDPL-scheme
employee remains glued to the computer and is not so conversant with the field realities.
When a customer comes with a complaint, instead of dealing with it himself, he puts the
DVB man in the front. And, the big difference in the salary package of the officials in
the two schemes has also not been taken kindly by the DVB-scheme officials. Of course,
the attraction of the pension benefits and job security under the Tripartite Agreement had
prevented them to switchover to the NDPL scheme. Only few DVB-scheme employees
have got sufficient recognition for their achievements. The new employees feel that it is
mainly their contribution which has resulted into excellent performance by the company.
The employees are not pro-Kuldip, but they are anti-Hira Lal. They think that he was a
party to the Takeover Agreement and has befriended the management; they have lost the
glory of the DVB days. The key thing is that the DVB-scheme high performers are
somehow fence-sitters and are not taking side of the one who is just and fair. Unless they
take proactive stand, it would be difficult to check the Kuldip factor. Privatization has
prevented the disgruntled elements to earn money through the illegal route as they were
so doing during the DVB days; and now they want to assert themselves.

Sardana had been constantly assuring the DVB-scheme employees about the company’s
policies of ethics, fairness, and job security. A DVB-scheme employee however, told that his
message had not percolated down. He said, “There is some amount of fear among employees
about their job security, despite the protection given to them by the Tripartite Agreement. This
was not because of any vindictive attitude of the management, which is too nice; but they have
the pressure of performance on them like it is so in any private organization. You will agree that,
it is the union’s duty to make the common employee feel comfortable.” This was of course for
sure that, the DVB-scheme employees could never dream of an over-protected work-life in the
new scenario.

PERFORMANCE, ACHIEVEMENTS AND CHALLENGES

NDPL improved its functioning on several operational parameters. The AT&C loss stood
reduced from 53 in July 2002 to 33.16 per cent on 30 September 2005, which meant reduction of
about 20 per cent in a period of 38 months from the takeover. A reduction of one per cent in
AT&C loss roughly translated to a corresponding gain in company’s additional revenue to the
tune of Rs. 22 crores. NDPL earned a ‘net profit after tax’ of Rs. 57 crore for the year 2004-05;
in the first year itself it earned a profit of Rs. 22 crore (for the year 2002-03). In fact, Sardana
suggested to the Delhi Government in July 2005 not to increase the tariffs for the consumers as
NDPL wanted to transfer the benefits resulting from the reduced AT&C loss onto the consumers.
The company secured the ISO 9001: 2000 certification for Quality Management System from
Det Norske Veritas of Netherlands for its five departments: engineering, projects, IT groups of
technical services, human resource management, and stores group of operations. And, out of the
150 companies which competed for “the Top 25 Great Places to Work in India” as per a survey
conducted by the Grow Talent Company in 2003, NDPL got the 27th rank.

Comprehensive changes took place on HRM front. Speaking of the progress on this front
Sardana observed:

“One of our biggest achievements is that we have been able to secure our right to govern
vis-à-vis our DVB-scheme employees. This category of employees should have no fear
psychosis about their job security. Yet the environment is one of accountability. The
union cooperation could be secured through our transparent attitude to collective
concerns of people, our belief in their legitimate right to play their role, and our decision
to take on issues head on rather than avoiding or suppressing them”

The company had got better media response for its performance than had been the case with
the two BSES companies. In fact, the other two companies came under severe criticism for non-
performance; so much so they got several warnings from Chief Minister Shiela Dikshit. In fact,
some NDPL managers had alleged that the BSES had incited Kuldip to rake up NDPL as the
former’s performance standard was too low compared to that of the latter. Some also alleged that
factionalism in Delhi Congress had also to do with the rise of Kuldip as Chief Minister Shiela
Dikshit’s dissenters did not want her to become too powerful through success of her power-
reforms, and NDPL’s remarkable performance in this regard had been openly admired by most
people including the chief minister. Among others, the conclusion from a large number of
reportings in the print media in favour of NDPL showed that of the total number of breakdowns
in Delhi, 92 per cent were in the BSES area and 8 per cent were in the NDPL area. Sardana
continuously interacted with Delhi politicians with a view to changing their attitude on issues
concerning power employees and governance of the Delhi power sector. Individual members of
the legislative assembly (MLA) of Delhi were regularly invited to have luncheon meeting with
the NDPL team and to discuss these issues.

While Sardana looked back at the progress made on various fronts, he was concerned at the
emergence of the Kuldip syndrome. He was taking stock of the challenges lying ahead of him.
He remarked that a big challenge before NDPL was changing the attitude and skill-levels of a
large number of DVB-scheme employees. While elaborating on some of the challenges that
NDPL was still facing, he observed: “We have not yet been able to get 100 percent loyalty of our
employees.” Commenting on the change of mindsets that had taken place, a general manager
observed, “We have been able to acclimatize about 50 per cent employees into the NDPL ethos.
About 30 per cent are fence-sitters, and about 20 per cent have not changed at all.” While the
employee behaviour had improved for the better, the contractors’ staff still needed to be trained
and subjected to behaviour-modification. Sardana was wondering how to make the union agree
to the need to settle the issue of water women, who had no role in the company’s functioning.
But more than anything else, he was asking himself how to confront the toughest of the
challenges i.e. tackling the Kuldip dynamics, avoid any major upheaval in the company, perform
competitively still better, carry out the transformational agenda further in order to march towards
the company’s vision so that the company could cash upon similar opportunities resulting from
power reforms on similar lines in other states.
Questions:

1. What do you think are the issues in employment relations before the NDPL? How are
they different from those that had to be dealt with by the DVB?

2. What do you think are the reasons for the popularity of the Kuldeep group? What will be
the impact of this development on employment relations at NDPL?

3. What is your opinion about the leadership qualities/ style of Mr. Anil Sardana?

4. What learning do you derive from the case?