Mahindra & Mahindra (M&M) has signed a wage settlement agreement with the labour union of its Igatpuri plant, even as the strike at its Nashik unit continues.

The automotive major has entered into a long-term wage agreement with the Bhartiya Kamgar Sena Union (BKS) which represents workmen of the Igatpuri plant, said a company statement. This agreement will be valid for three-and-a-half years . M&M produces automotive engines at this plant. Mr Suryakant Mahadik, President, BKS, represented the workmen while Mr Vijay Dhongde, Senior Vice-President, Manufacturing Operations, acted on behalf of the management.

Meanwhile, the tool down strike in M&M’s Nashik plant which started on May 5 still continues. It is here that the Bolero, Xylo, Scorpio and the Logan sedan are made.

According to the company, the strike triggered by the disciplinary action against the employee union leader is illegal and unjustified as it started without prior notification.

"The employee union of the Nashik plant is not under the control of BKS and we could not intervene in the matter. We urge the workers to end the strike given the current recession," said Mr Mahadik.

The Nashik Industrial Court on Thursday had declared the strike as illegal and directed employees to resume work in 48 hours. However, the workers decided to appeal against this order in the High Court. The company has refuted the union’s claim that the unsettled wage issues have led to the strike.

A section of M&M’s dealers believe that the strike may impact delivery schedule of vehicles, particularly the Xylo, which has been getting a good response from customers.

"Production has been affected for the last 8-9 days but we have an inventory pipeline. We have a court order asking the workmen to end the strike and we hope they adhere to it," said Mr Rajesh Jejuriker, Chief of Operations, Mahindra Automotive Sector.