“A study on HR Functions,

with special Reference to Employee Relations Strategies

at ABInBev India- CBL Plant, Sangareddy.”

Submitted by
Sanku Chaitanya Prasad
Roll. No- 171297

Submitted to
Mrs. A. Niharika
Assistant Professor

VIGNANA JYOTHI INSTITUTE OF MANAGEMENT

Bachupally Road, Hyderabad, Telangana – 500090
2018
1
 Internship Details

Title of the Project : “A study on HR Functions, with special reference to Employee

. Relations Strategies at ABInBev India – CBL Plant, Sangareddy”

Name of the Student : S.Chaitanya Prasad

Name of the Company : ABInBev, CBL Plant.

Department : People Business Department (HR)

Company Mentor Details

Name : Mr.E.Anjaiah

Designation : Associate Director – Employee Relations, PAN India, ABInBev

Contact Details : Mail - anjaiah.eamani@in.ab-inbev.com, Phone – 9989756788.

Company Website : http://www.ab-inbev.com/

Plant Address : ABInBev India, Shivampet, Pulakal Mandal, Sangareddy,

. Telangana- 502273

2
 DECLARATION

I hereby declare that this Project Report titled “A study on HR Functions, with special Reference
to Employee Relations Strategies at ABInBev India- CBL Plant, Sangareddy.” submitted by
me is a bonafide work undertaken by me and it is not submitted to any other Institution or
university for the award of any degree/diploma certificate or published any time before.

Name of the Student: S.Chaitanya Prasad Signature of the Student

3
 AKNOWLDGEMENT

No endeavour is completed without the valuable support of others. I would like to take this opportunity to
extend my sincere gratitude to all those who have contributed to the successful completion of the project.

I, S.Chaitanya Prasad, extremely grateful to “ABInBev, India” for the confidence bestowed in me and
entrusting my project entitled “A Study on HR functions with special reference to Employee relations
at ABInBev India- CBL Plant, Sangareddy.”

At this juncture I feel deeply honoured in expressing my sincere thanks to my guide in the workplace,
Mr.E.Anjaiah, Associate Director (PAN India) – Employee relations- ABInBev, for suggesting me to do
project on employee relations and productivity linked bonus. Where both the projects helped me in gaining
real time learning experience in HR domain at plant level. And I also thank Mr.B. Madhava Raju, Plant
Head, CBL- ABInBev, for Believing in me and assigning responsibility in the International Audit and
giving me some confidential data regarding the company to present the alternative solutions for Effluent
treatment plant (ETP).

I express my deep sense of gratitude to Mrs. A. Niharika, Assistant Professor, VJIM, under whose
guidance I could make a thorough and complete copy of my project work.

I also thank all the employees of ABInBev CBL plant and few HRs from other branches, who helped me
in completing my project.

- S.CHAITANYA PRASAD

4
 Executive Summary

This report is prepared based on the three months internship program that I had successfully
completed in ABInBev India – Charminar Breweries Plant, Sangareddy as a partial requirement
for the award of the Post-Graduation Diploma in Management. This project report is not confined
to single area of study in HR domain. It is a documentary evidence of what I learnt and how
practically I was part of all major HR function activities at plant level.

Besides that, the report briefly explains how important it is to design and execute good employee
relations strategies and how management can do it through operational strategies, grievance
redressal mechanism and IR committees. It also throws light on the process of calculating
productivity linked bonus as per the statutory compliance and Long-Term Settlement agreement.
How important it is for HR to understand and support the business is also documented in this
report.

As it is not feasible to document the entire information regarding the three important projects taken
up in the internship tenure, parts of them that are important and can give the overall picture of the
projects are reported.

The crucial findings and learnings from this project were- how an HR manager should ensure good
employee relations not just by handling grievances, but by avoiding any issues to arise. Simply
put, “prevention is better than cure”.

Overall, this project brings out that the core HR function at plant level is to make sure the business
runs profitably, and employees share that profit by means of reward, recognition, respect and
relations. This makes up Industrial Peace.

5
 Table of Contents

Chapter. No Particulars Page. No

PMCI Analysis

- Product 10-11
1
- Market 12-14

- Company 15-17

- Industry 18-19

Introduction to project work

- Need for the study 21

- Objectives of the study 21

2 - Scope of the Study 22

- Methodology 22

- Limitations of the Study 22

Work Area Deliverables

- Orientations 24
3
- Tasks Assigned 25-26

- Carried out Activities 27-28

Work Area Outcomes

4
- Presentation and analysis of the collection data 30-44

Relevance to the company 46

5 My learnings 47

Conclusion 47

6 Bibliography 48

7 Annexure 50-52

6
 List of Tables

Table Page
Title of the Table
Numbers Numbers

Table - 1 Top 10 Beer Brands in India 14

Table-2 ABInBev Products in India (Area of Production) 17

Table – 3 Trade unions in ABInBev Breweries 32

Table-4 Strategic roadmap (2019-2021) 35

Table – 5 Site Level IR committee 38

Table-6 Country level IR committee 40

Table-7 Line wise and Day wise production 41

7
 List of Figures

Figure Page
Title of the Figure
Numbers Numbers

Figure- 1 The New brands that are going to enter in Market 13

Figure- 2 Journey of ABInBev 15

Figure- 3 ABInBev global footprints 16

Figure- 4 ABInBev footprints in India 16

Figure- 5 ABInBev products in India 17

Figure- 6 Beer Consumption in India 18

Figure- 7 Market shares in Beer Industry 19

Figure- 8 CPI Index -2018 33

Figure- 9 Site level grievance redressal process 37

Figure- 10 Country level grievance redressal process 39

LTS agreement for Productivity linked Bonus at

Figure- 11 42
ABInBev – CBL plant

8
CHAPTER -1
PMCI Analysis

9

Product Name
Product Category
Product Description
Product Ingredients
Product Specifications
Product Advantages
Product Disadvantages
Product Types (Packing)
Canned Beer Glass Bottled Beer
PRODUCT
: Beer
: Alcoholic Beverage
: Beer is one of the oldest and most widely consumed
alcoholic drinks in the world, and the third most
popular drink overall after water and tea.
: Grains (Malt, Rice, Corn, Oat, Wheat), Hops,
Yeast, Water, Flavours and alcohol content.
: Colour - Depends on the Grains used in
production.
Smell - Depends on Alcohol and flavour of Brand
Taste - Bitter Taste .
Alcohol - 3% to 6% of Alcohol by volume (Max-
32%)
: Helps in reducing the chances of forming Kidney
Stones.
Helps to reduce bad cholesterol (LDL)
Increases Vitamin B levels.
Boosts the memory power. .
Slows down the aging process (Skin appearance)
: Increases Blood Pressure.
Oral cancer.
Increases Liver function rate.
: Glass Bottled, Canned Beer, Craft Beers
Craft Beer 10
Manufacturing process of Beer

Step-1 : Beginning In the brew house, different types of malt are crushed together to break up the
grains in order to extract fermentable sugars to produce a milled product called grist

Step -2 : The grist is then transferred into a mash tun, where it is mixed with heated water in a
process called mash conversion. The conversion process uses natural enzymes in the malt to break
the malt’s starch down into sugars.

Step -3 : The mash is then pumped into the lauter tun, where a sweet liquid (known as wort) is
separated from the grain husks

Step-4 : The wort is then collected in a vessel called a kettle, where it is brought to a controlled
boil before the hops are added

Step- 5 : After boiling, the wort is transferred into a whirlpool for the wort separation stage. During
this stage, any malt or hop particles are removed to leave a liquid that is ready to be cooled and
fermented.

Step – 6 :To start the fermentation, yeast is added during the filling of the vessel. Yeast converts
the sugary wort into beer by producing alcohol, a wide range of flavours, and carbon dioxide

Step -7 :After fermentation, the beer needs to be matured in order to allow both a full development
of flavours and a smooth finish.

Step -8 : After reaching its full potential, the beer is filtered, carbonated, and transferred to the
bright beer tank, where it goes through a cellaring process that takes 2-3weeks to complete.

Step -9 : Once the beer is ready, it is sent to the packaging department for filling into bottles as
per the brand.

11
 MARKET

India is one of the biggest manufacturers of Beer in the world. Beer market is matured in India
over the years but still it is highly confined to limited varieties. Many International players have
entered the market in past few years, but due to high import tax and restricted availability (limited
to major cities), these companies haven’t achieved much till date. Now lets look into brief about
Beer market in India from various contemporary view points as follows -

A) Drivers for Beer Market in India

- Growing Youth population
- Changing lifestyles
- Availability of Imported and Premium Beers in market.
- Increase of the working population and their disposable income.

B) Challenges for Beer Marker in India

- Getting licences
- Heavy Taxation and legal Regulations.
- Huge Diversity
- No permission for Marketing widely and directly.
- Youth are shifting from branded beers to craft beers or Spirits

C) Pricing
Pricing is one of the most important factor that affect beer market. Consumers are price
sensitive they try to switch the brands due to price hikes. However, there are certain premium
brands whose demand is not shifted by the price of it.
Moreover, pricing of alcohol products is in the hands of government rather than in the hands
of manufacturers. At an average the cost of production of a beer bottle ranges from Rs.17 to
Rs.45 (In general) whereas the final MRP will be from Rs.90 to Rs.170

D) Promotions
In India Promoting the alcoholic products is legally prohibited. So, companies can’t go with
direct marketing of beer and other alcoholic products in India. But, to make their brands
familiar to their customers, they come up with surrogate marketing strategies. Ex- Carlsberg
Advertises for Drinking glasses, Kingfisher for soda etc. In India, as of now ABInBev don’t
have any promotional activities even in indirect way.

12
E) New Brands in the Market

As per the trends and preferences of the

beer lovers, Indian beer market is going to
witness new brands from all the beer
companies. Especially in premium
segments.

Even though the beer sales fell in 2017

due to various legal restrictions,
companies are seeing a potential growth
in the market. Which made them to plan
to serve a wide variety of beer to their
consumers.

Figure - 1 , Source – Economic Times Beuro, March-18

Beck’s Ice is one of the

prestigious brand, that ABInBev
want to launch in India. As the
market is also open to taste new
brands, company believes it can
generate good market in India.
As of now it is served in Delhi
and Maharashtra

Preferably, by 2018 December,

Beck’s ice will be served in all
metropolitan cities in India.

13
F) Top Beer Brands in India

There are many Beer brands in India which are very rich in quality and price. But, from
the view point of sales in 2017-18 the top 10 beers in India are mentioned as follows -

Top 10 Beer Brands in India (Based on Sales)

Rank Beer Brand Company

1 Kingfisher United Breweries

2 Haywards 5000 ABInBev

3 Royal Challenge ABInBev

4 Carlsberg Carlsberg

5 Budweiser ABInBev

6 Foster ABInBev

7 Tuborg Carlsberg

8 Corona ABInBev

9 Heineken Heineken

10 Kalyani Beer United Breweries

Table -1 , Source- Scoop Hub India

It is important to note here that, out of the top 10 beer brands in India, 5 beer brands belong to
ABInBev. It shows the strength of the company in ABInBev.

14
 COMPANY

A) Key Information (Global Data)

Name of the company : Anheuser-Busch InBev (ABInBev)

Founded on
(By merging of AB group : 2008
and InBev Group)

Chairman : Mr. Oliver Goudet

CEO : Mr. Carlos Brito
Headquarters : Leuven, Belgium
Total Employees : 1,82,915
Anheuser-Busch
Subsidiaries : AmBev
Grupo Modelo
SAB Miller

Revenue : US$ 56.44 Billion

Market Share (Global) : 28%
Market Position : Market Leader

B) Journey of ABInBev

Figure -2 , Source- ABInBev Website

15
C) ABInBev Footprints

Figure -3 , Source - ABInBev Website

Figure -4 , Source – Prepared Based on

Internal Data

Until 2016, ABInBev have only

two manufacturing plants in
India. But, After Acquiring SAB
Miller India, it became second
largest manufacturer of Beer in
India, with 10 manufacturing
plants in 9 states.

Indian Hub office and Global

Hub office of the company are in
Bangalore. There are also 4
regional/ sales offices located in
Hyderabad, Mumbai, Gurgaon
and Bangalore

16
D) ABInBev India Beer Products

Brands Production Points

Stella Artois Imported
Budweiser Crown, HBL, MALBAR
Knock Out CBL, CDBL, RBL
Leffe Imported
Haywards 5000 CBL, SPR, MALBAR
Royal Challenge CBL, SICA, SPR
Fosters PALS, RBL
Corona Imported
Hoegaarden Imported

Table - 2 , Source – Company’s Internal Data

Figure - 5 , Source – Company’s Internal Data

17
 INDUSTRY
A) Beer Consumption and Profile in India
From 2012-2016 Beer industry saw a volume growth in India, but in 2017 with the supreme
court rule of closing the wine shops and other outlets that are near highways affected the
Beer market. But, with many exemptions in that rule, in the coming years it is evident that
the beer market in India can pull up.

Figure - 6, Source – Outlook for Indian Beer Market,2017 (BMI Research)

-In volume terms, Beer sales will raise at CAGR of 7.5% between 2017-2021

- According to the All India Brewing Association, craft beer sales are growing at 20 per
cent year on year with over 80 microbreweries now in operation, compared to just two in
2008.

- Strong beer segment contributed highest revenue share towards overall India beer market
in 2017.

-Working class population are the major consumers of mild beer in the country.

- Most Imported Beer in India is ‘Corona’ and Mostly Beer is imported from Belgium.

18
B) Market Share

There are no plently of players in the alcoholic beweries in India. The competeion is all between
two or three companies. Majority of the beer market in India is owned by United Breweies which
manufactures kingfisher and next followed by ABInBev and Carlsberg. As per the latest
industrial updtaes, carlsberg is the best company in Indian beer market with a good growth rate
than its top competetiors

Market share of Beer

Manufacturers in India - 2018

51%, United Breweries

25%, ABInBev

17%, Carlsberg

7%, Others

Figure - 7 , Source – Economic times survey, March-2018

C) Seasonal nature of Business.

Brewing is mostly of seasonal business. Beer consumption can be seen at peaks in April- June,
September and from mid-December to January end. In the remaining months the consumption
is less than 2/3rd of the seasonal consumption. Companies plan their production as per the
seasonal trends.

19
CHAPTER -2
Introduction to
Project Work

20
 Introduction

In the contemporary business world, where everyone is busy in understanding the technological
disruption in HR domain, still there are many functions at plant level where the concept of
“people” can’t fade away with modern disruptions. HR functions in a manufacturing plant are
quite different from corporate HR functions. Ground level realities at plant level can’t be treated
in the same way as treated at corporate level. One of the key differences is Employee relations.
So, it is very crucial to study employee relations and to know how exactly it plays an important
role at plant level during various business situations.

Definition for Employee relations

“Employee Relations involves the body of work concerned with maintaining employer-employee
relationships that contribute to satisfactory productivity, motivation, and morale. Essentially,
Employee Relations is concerned with preventing and resolving problems involving individuals
or group of individuals which arise out of or affect work situations.”
- Henry and Noon

Need for the Study

After Acquiring almost 10 manufacturing plants of SABMILLER India, ABInBev is trying hard
to manage all the big plants by inculcating its global principals in local plants. Whereas strong
unions in 2/3 of the plants throwing a biggest challenge to the management to implement those
policies that can give better business results. So, it is need for the hour for the management to
understand and design a framework to maintain better relation with unions and to run business
smoothly. This need of the company is the basic objective to conduct this study.

Objectives of the Study

 To Prepare ABInBev India Employee Relations Report -2018.

 To Calculate productivity linked bonus at CBL Plant.
 To Study on an alternative business plan regarding the Effluent Treatment Plant water usage.
 To understand workplace dynamics with relation to HR functions.
 To offer Suggestions if any, in further improving HR functions with special reference to
Employee relations at CBL plant, ABInBev.

21
 Scope of the Study

The scope of the study is limited to HR functions at CBL plant of ABInBev India. The study will
be able to throw light on some areas where management need some sort of improvement in the
way HR functions been implementing. But, for preparing the Employee relations report of
ABInBev India, the scope is extended to all 10 Manufacturing plants of ABInBev India.

Methodology of the study

Source of Data –

Primary Data : Data is collected from

 Interacting with Plant Head, HR Head and Union members at CBL.
 HR supervisors from all other ABInBev Plants in India.

Secondary Data : Data is Collected from

 Analysing the Employee relations reports of ABInBev Australia and Asia
Pacific zone countries.
 Labour Department reports of few states.
 Long Term Settlement Agreement documents.
 Production turnover documents at CBL Plant.
 Other Relevant websites and News articles.

Research design
The exploratory research is conducted for the study on HR functions and Employee relations
mechanism at ABInBev- CBL Plant.

Limitations of the study

 The study is mostly limited to the ABInBev Charminar Breweries plant at Sangareddy.
 Due to time constraint, during the conversations with HR managers at other plants, it was
difficult to procure all the information on unions and issues at other plants
 Due to the confidentiality of data, couldn’t study deeply into some of the HR functions

22
CHAPTER -3
Work Area
Deliverables

23
 Induction – Orientation

Once entered the plant, very important thing that each and every individual must and should
follow is safety. So, first gone through safety induction and training. Later, introduced to all the
supervisors from the functional areas. After few days got the opportunity to learn the entire
brewing process and business model of the company. The most crucial part of the orientation
programme is to be familiar with the contract labour and trade union laws. Get through all the
HR policies of the company and hierarchies before starting the study on HR functions.

Projects taken up

After completing the induction, orientation programmes and submitting few presentations
in the initial days of internship, made the HR manager to give me few important projects
that are crucial for business. Those projects are as follows -

 Employee Relation Report ABInBev India

HR Head at CBL plant gave this project, to prepare a report on employee relations of ABInBev
India (Covering all 10 Manufacturing plants) by studying :-
 External factors that affect the HR and ABInBev Business in India.
 Internal workforce strength of ABInBev India.
 Plant wise HR goals and union issues.
 Few related labour laws (Contract labour Act, Trade union Act and Industrial
Disputes act)
 ABInBev Australia and APAC region’s employee relations reports.

 Calculating Productivity linked Bonus.

As per the long-term settlement (LTS) agreement between union and management, for 2017-
2018 period management at CBL must give productivity linked bonus to employees in 2018-
19. For this, data must be collected from the packaging and quality departments regarding
efficiency of the line (OEE- Overall Equipment Efficiency) day wise and month wise to finally
calculate OEE for a complete year.
Then as per the agreed terms regarding the bonus, the amount that falls in a particular OEE
percentage bracket will be given as the yearly bonus to the employees in the month of
September.

24
 Presentation on ETP water Usage
Plant Head gave some confidential project regarding usage of ETP water generated by the
company and how to make pollution control board to accept this proposal. So, with the
collected data from the internal sources and Local ETPs, prepared a presentation and presented
it to the Bangalore office officials.
As most of the data is confidential in nature, presenting only a part of the data in Chapter -4

Carried out Activities

[

Apart form the major tasks assigned, spent some time daily to observe, understand and learn
most of the HR functions from recruitment and retirement. People from HR department helped
a lot in learning these functions. Mainly, HR head helped me in understanding Business side
of HR and how to handle with unions. Some of the most important HR functions carries out in
the internship tenure are stated as follows -
 Time office functions
Handled time office functions for one week. While handling the time office functions, clearly
understood the importance of it. The activities carried out in time office are :-
 Tracking daily attendance of associates, executives and contract labour
 Preparing daily productivity report based on manhours
 Issuing Gate passes (as per LTS agreement) and verifying them.
 Maintaining leave cards
 Filling ESI for new contract labour entering the company.
 Filling labour deployment sheets.
 Giving forms 7B and 37 of ESI for contract labour to get medicines and
treatment from recognised ESI hospital from their ESI account.
 Checking once in a while in the backyard, to ensure that the contract labourers
are working properly or not.
 Giving safety induction to the visitors.

 Welfare checklist
Daily, for two months visited the entire plant for 2 hours, to check all welfare facilities whether
they are in place as per law or not. If there is any improper management of welfare facilities
like canteen, water filters and washrooms then immediately approached to supervisor
responsible for that and asks him to make it right. Even then if those things are not taken care
of, then reported the same to HR manager/ HR supervisor.

25
 Completing VPO E -Learning courses
Voyager plant optimisation is one of the most important policy ABInBev follows to make all
their employees follow certain discipline and showcase great teamwork in workplace which
ultimately helps in running business successfully. As per VPO there are 7 pillars of house.
Employees those who are in managerial category must know about each and every pillar. So
that for every quarter every employee must go through all the E- learning courses on 7 pillars
deeply and must give exam on it, this individual score on VPO is part of the employee
performance, which helps employees in their performance appraisal.
Completed all those e learning courses, which helped me a lot to get insights about other
functions at ABInBev.

 Safety Meetings & Trainings

Daily morning, 9:15 to 9:40 there will be a safety and quality meeting organised by safety
manager to all managers at the entrance of workplace. In these meeting – Daily safety
precautions, previous day performance and any hazards from the respective departments will
be brought forward and will be discussed on the solutions.

 Audit Supervisor (for welfare and safety areas)

A global team visit and internal audit was scheduled in the month of June. Management made
me supervisor for welfare and safety areas. Visited the entire plant along with plant head and
safety manager to note down all the areas where the changes have to be made and within 7 to
10 days we are able to make workplace clean and green.

26
 Conducting Annual employee welfare survey
As per the Company policy, for every quarter plant wise employee welfare and engagement
surveys are to be conducted. Questionnaire for the survey came from head office. Collected
the data from 180 employees. After collection of data, analysed it a submitted to the
management.

 Contract labour’s monthly bill processing.

For the month of May and June, with the guidance of manager, processed the contactors bills.
 First, have to get man days list from the time office as per the contract labour
attendance register.
 Next have to verify with deployment sheets at a random basis.
 Once we are ok with the man days, contractor will submit the bill on their letter head
including festival bonus and their commission.
 Each and every bill have to be checked, mainly focusing on ESI and EPF and
percentage of commission is there as per the agreement or not.
 Should verify the challans of PF and ESI for the last month, to ensure that the
contractor is paying them to the contract labour.
 Once everything is ready, all the details have to be entered in the predefined format
on the company letter head and should be get signed by the HR manager and Plant
head.
 Next, those approved bills from HR have to be transferred to finance department.

 Assisting in processing Payroll.

Assisted the HR supervisor in processing payrolls for the month of May and June. The details
from the employees will be collected regarding any deductions or transfers from their salary
and medical claims etc. Later, verify all the deductions and additions as per the documents
presented by employees and as per LTS. Then, enter them in pay roll software and make all
necessary adjustments.

 Coordinating for Engagement activities.

Management organises employee engagement activities like celebrating employee birthdays
with all employees in the plant, celebrating highest production days and recognising the
employees who served more than 15 years -20 years in the company by giving them certificates
and gold/ silver coins. Management organises a big felicitation function and party on the
retirement day of an employee.
27
 Getting Medical cards for regular employees
As per the last agreed LTS, every employee should get a medical card which will help them in
getting medical assistance. Management along with Medi Assist provided Rs 2,00,000
insurance per annum to every employee. Entered employee wise data in the Medi Assist portal.
Once approved, downloaded the individual and family members medical cards and gave to
the employees. CBL plant is ahead of all other plants of ABInBev India in issuing medical
cards to its employees.

 Arranging the required contract labour

As, it is very much needed to get manpower (contract labour) more in number during seasonal
periods, company can’t afford to stop production due to lack of manpower. In general, due to
local influences like marriage and festival days many people didn’t use to turn up for the work.
On that day, it is very difficult for the company to run the production. So, on those days we
used to go to nearby village “Addaas” and get people on daily wage basis. (Rs.400)

 Interview with Union Leader

With due permission from management and union leader, got the opportunity to interview the
working president of the CBL trade union Mr. Bhaga Reddy. The interview with him is clearly
documented and attached to the project in Annexure. Few important findings from that
interview that “Only when there is a strong voice to the union, it can survive. Only when a
strong voice reaches management, it will resolve the issues”

28
CHAPTER -4
Work Area
Outcomes

29
 A. Employee Relations Report – 2018, ABInBev India

The Scope of Businesses are changing, so as the Business models. Across the globe ABInBev
believe that along with changing its business models, maintaining better relations with all the
stake holders of their business can make them grow and excel in brewing industry. But, to do
so they should be able to first understand all the areas that can impact relations with employees
and other stake holders of the business.

This report helps to cover the culture and principles of ABInBev, factors that are affecting the
employee relations and frameworks that are need to maintain better employee relations. This
will ultimately act as a document to let the management know what they are as on date and
what they can be in the future and how they can reach goals.

 Objectives as determined by ABInBev.

- To showcase the culture of ABInBev and its Footprints in India.
- To show how the external factors can influence ABInBev People and Business
operations.
- To analyse the Internal Workforce of ABInBev India.
- To plan a strategic roadmap for the near future (2019-2021).
- To frame Employee relations Strategies (Grievance Redressal Mechanisms and
Committees).

As most of the data furnished in this

“Employee relations Strategies -2018”
report is confidential, that particular data
is omitted and necessary things which
can be fit as per the SIP format are
analysed and discussed further as –

 Factors Affecting HR operations

 Strategic Road map
 Establishing Employee relations
strategies.

Carlos Brito, CEO of ABInBev

30
 Factors affecting the HR and Business operations of ABInBev in India
There are many factors that affects the business and people operations. But, the factors
which have high impact on the brewing business and ABInBev people operations related
to employee relations are discussed as follows -
1) State Governments Banning Alcohol Consumption in India
In India, Due to lot of political Reasons the Situation of Ban, No Ban and Re Ban of
Alcohol Consumption goes on. Constantly there are few states such as Gujarat, Nagaland
and Lakshadweep Islands who banned Alcohol Consumption. Currently Bihar is also a
Dry State. But, there are few cases in the past, where few states like Kerala, Andhra
Pradesh, Haryana, Manipur, Mizoram and Tamil Nadu which banned Alcohol
consumption for few years and later they Lifted the ban.

There Is a lot of Risk involved in this kind of Political scenarios where Political parties
during their term of ruling, Ban or lift the ban or Re Ban Alcohol consumption. This
would directly affect Production and Distribution, also lot of employees and families
who are depended on Business Operations.

2) Supreme Court Ban on selling Alcohol Nearby Highways

In March 2017, The Supreme Court passed an order banning the sale of alcohol along
national and state highways, ordering the cancellation of liquor licences issued to shops
by April 1, 2017.

“The order states that no liquor stores should be even visible from highways or located
within 500 metres of the highways or be directly accessible from a national or state
highway. The order has been subsequently modified to exempt establishments within 220
metres of the highways for smaller towns and municipalities with a population of less
than 20,000 people.”

However, the court clarified that hotels, bars and pubs that serve alcohol will be included
in the ban, sending many such establishments reeling as footfalls drop sharply.

- 2% fall in the sales of Alcohol Breweries.

- Closure of One Third of the country’s Liquor Vendors.

The fear of Losing job and fall in production will affect Regular and contract
workers.

The effect on the alcohol breweries through this rule doesn’t last for long time,
due to several amendments to the judgement given by Supreme court.

31
3) Trade Unions and Their Political Relation (Plant wise)

The Below table shows the data of the elections to be held in the ABInBev India Plant
locations in the nearby short-term future. This data further helps us to give an idea of how
the Political parties can have grip over trade unions and how they can impact ABInBev
Business.

Year of
Trade Affiliated
Plant Name State Assembly
Union Party
Elections
Crown Beers India Ltd Telangana 2019 CITU CPM
Charminar Breweries Ltd Telangana 2019 CITU CPM
Pals and Fosters Maharashtra 2019 CITU CPM
Pals and Fosters Maharashtra 2019 CITU CPM
RBL Rajasthan 2019 CITU CPM
ECB Odisha 2019 CITU CPM
HBL Haryana 2019 BMS RSS
SICA Pondicherry 2021 Multiple (4) -
Not
SPR Karnataka 2018 AITUC
Affiliated
Malabar Kerala 2021 Multiple (4) -
CDBL Uttar Pradesh 2022 Not Affiliated -

Table -3 , Source - Internal Data and Elections Commission Board

There is always a big impact on Business based on the power and strength of the Trade
union in plants. Most of the Trade unions are affiliated to a particular political party or
a strong association in India. So, the party which is ruling in the central and state level
also determines the strength and impact of trade unions.

In more than half of ABInBev plants, there is CITU trade union, which is very powerful
in India. Even though its affiliated party CPM is not ruling in central or at state level
(except in Kerala) it gained a lot of strength through their strong ideologies and power
to communicate to people.

So, ABInBev Business in India may face challenge if there is Uniformity in Trade
unions at all branches. It may give more power for them to take control of Business,
which can make a huge impact to the company.

32
4) Consumer Price Index
There is always a need to understand the CPI index of the country where we are operating.
This helps business to fix the wage agreements between management and Labour. It is
also a sole measure used in India to find out Inflation and designing monetary policies.

160 147 8%
142
136
140 127 7% 130 7%
119
120 6%
100 5%
5% 4%
80 4%
4%
60 3%
2%
40 2%
20 1%
0 0%
2015 2016 2017 2018 2019-E 2020-E

Index Value % Change

Figure -8 , Source: Ministry of Statistics and Programme Implementation (MOSPI)-2018

The forecasted gradual and consistent increase in the consumer price index states the
increase in cost of living and standard of living people in the country. It helps us in
deciding wage agreements with workers.

Even though CPI growth rate is around 4% to 5%, ABInBev business provides VDA hike
for the contract labour around 8%-9%. In case of LTS, for every three years the average
wage hike is 25% to 30% of the present VDA.

5) Seasonal Impact on the Business.

The demand for Beer is more from March to June every year. The best season for it is
summer. As a result, the need for manpower is more in this season than others. In
general, in the season period company need 1000 contract labourers daily (for 2 shifts
in total). Where as in off season they need only 600 contract labourers daily (for 2 shifts
in total). In the recent season period, it is very much evident that there is a shortage of
manpower in the plant location due to various factors. Which affected the company to
reach its production goals and it took lot of efforts for the HR department to arrange
manpower. But in office season, contractors used to ask management to take extra
manpower.

33
 Strategic Road Map for the nearby future
It’s always better to have a clear plan, before going to take actions. So, with the key goals of
ABInBev APAC south region employee relation goals, a strategic road map for the employee
relations of the ABInBev India is formed as follows –
Key Goals for the APAC south region are again divided into sub goals (Year wise) for the next
three years (2019,2020 and 2021) with aim to satisfy all the stake holders with the resources
available and strategies framed.

ER Goals 2019 2020 2021

Continue the
practice and
Encouraging and Recognize the best
Encouraging Dream
reviewing the best Plant and
People Culture
DPC practices in all employees
embedding Activities
our plants annually that
embedded DPC in
their Activities
Describing the
Proper Planning and
Responsibilities for
Implementation of Organising New
each and every role
People Pillar as per Starters Review
and giving clarity on
VPO standards
that
Organising Strong Reviewing People
Upgrading the facilities
Leadership Excellence
and Processes
Programmes Programmes
Reviewing
Learning and
Cultural Encouraging Learning Analysing future
Development
Transformtion and Development learning needs and
programmes
Programmes framing L&D plans
outcomes and plan
Accordingly
Using Metrics to
Using the EVP to
Develop Operations measure the
Attract Careers In
EVP performance of
operations.
EVP
Analysing the
Results from the
internship,
Planning for bringing
Designing Female planning to
women into our
Internship Programmes continue the
Business operations
internship
programmes in a
well-defined way
Structured Implementing People
Operational Process Excellence
Review Programmes.

34
 Tracking down the
Continuing the
To Bring the passion progress from all plants
Communication
into the workplace and aiming for
Review Systems
consistency
Building strong Bringing out the
internal Communication Employee Owned
communication Review Programmes Initiatives and
System rewarding them.
Building Building Strong Embedding the
Consultation Feedback interactive sessions as
and Mechanisms a part of culture.
Communication Showcasing
Ensuring the
Framework transparency in
performance in
Rewards and
Engagement Block
Recognition Systems
Implementation of
Ideas Capturing
Scheme
Initiating regular
Interaction sessions
with employees

Discussing most
Implementing the
Identifying Gaps in important trends In
Legality Software in
Statutory Compliances the Brewing
all Plants and regional
and Filling the gaps operations in the
offices
Industry Groups
Developing the Plant
Assessing the impact Interacting with
local team as per the
of Union Engagement Union's peak
Business
Initiatives. Bodies
Requirements.
Reviewing the
Bargaining Implementation of the
Union Engagement implementation of
Approach for Benchmarked
Initiatives benchmarked
Industrial practices
practices
Existence and
Updating the
Excellence in Maintaining Industrial Continuing the
Grievance
India Groups Industrial Groups
Mechanisms
Establishing Relations Continuing the
with local Grievance Redressal
governments. Mechanisms
Establishing Strong
Grievance and
Negotiation
Committees
Benchmarking of best
Industrial Practices.
Table – 4 , Source - In
“Framing strategies to reach these goals and implementing the action plans
lies within the scope of each plant as per their local conditions.”

35
 Building Employee Relations Approach
The Business models are changing, Technological Impact is affecting, each function is
updating. Then, why the strategies for maintaining employee relations should be remain
traditional where even the scope of employee relations have been increasing. So, its time
to build new age strategies for maintaining Employee relations.
Wherever the business is, to run it smoothly the first thing that is to be addressed are
grievances. If they are not addressed properly then and there itself, it may lead to serious
situations. So, there are many methods to handle the grievances. One of the most
common method that is used, when there are less number of employees is ‘Open Door
Policy’. But this method too has few serious limitations. Majorly, giving more power
to the union leaders and anyone directly having a communication with the top people
even for the petty issues that can be solved by the immediate supervisor. At the same
time, this method is also very much helpful to reduce the time of resolving the issues.
So, keeping all the in mind, a new age hybrid grievance redressal mechanism and ER
committees are designed to make a defined system to resolve the grievances and to take
all necessary steps to maintain better employee relations.

“Grievances should be resolved fast, but not in an inappropriate manner.

A Repeated Grievance says the ineffectiveness
of Redressal Mechanism”

So, let’s look into Strategic framework at site level, Country level and Zonal Level

Zonal
Level

Country Level

Site Level

36
1) Site Level Grievance redressal mechanism and IR Committee.

Figure - 9

 Aggrieved Party (employee) can go to the

Grievance Communication
grievance cell and to Supervisor (in case of Representative.
contract labour) to convey their issues or directly A grievance representative is
to the concerned representatives. appointed, and that particular
person will be responsible for the
 Grievance cell representative will convey the
prompt communication of the
Issues to the Concerned representatives within 6 Grievances to the concerned
hours of reporting. representatives.Every Grievance
whether it is passed through him
 Concerned representatives should try to solve the or not, must be recorded in the
issues within 48 hours of reporting. appropriate format. All the
 If, in case the grievances are not able to resolve by Resolved and Unresolved issues
should be signed and filed and
the Concerned representatives then they will will review it the IR committee
communicate and pass it to the Concerned Head meeting or works committee
meeting.
of the Departments, within 24 hrs.
 Head of the Departments will try to solve at their level or meet with other Department
heads to resolve the issues, within 24 hrs.
 If the issues are not resolved even at HOD level, then the issues are presented in the IR
committee or Works Committee.
 Works Committee Should try to solve it within reasonable time.
37
 Site Level IR Committee (works Committtee)

Objectives Members Role of Members

- To find out - HR Supervisor will initate the
collective solution on meeting and read the issues that
the problems or (Employer) are cleared and still pending and
grievances that are not - Plant Head tentative time required to solve
resolved till date. - HR Head the issues.
- HR Supervisor
- To Disscus on the - Packaging Head - Later, Plant head will Read the
fortnightly fortnight performance report.
performance and - Technical Head
issues - Brewing Head
- HR head will read about the
- Safety Head fortnighlty goals ans measures.
- To set up the
fortnightly goals and (Employee)
measures. - Union leader will read about
- Union leader the demands and their concern
about the issues (Grievances)
- Rep. Technical
- To discuss on
compliance check list - Rep.Packaging
and taking immediate - Later Respresentitives from
- Rep. Brewing both side will discuss on how to
actions, if falling
behind in any - Rep.Welfare and solve the issues in their
Compliance areas. Benefits respective areas and what more
- Rep. Safety can be done to increase the
effectivness and effeciency of
- Rep.Contract Labour the production.

- HR supervisor will windup the

Frequecny of the meeting meeting with the breif
discription of what happened in
- For every Fortnight - (2 Hours) the meeting
- In the company premises. (Face to Face)

Table - 5

As per the Industrial Disputes Act,1947, we can use this IR committee as a works
committee or as a grievance committee as per the state laws to solve the site level IR
issues and to maintain better employee relations.

38
2) Country Level Grievance redressal mechanism and IR Committee.

Figure - 10

 In site level Grievance committee, the

members are Zone wise
 Plant head Grievance Cell
 Functional Head (People)
Grievance Cell consists of
 Union Office Bearer
few members such as –
(General Secretary/ Working president )
 In Country level Grievance committee, the - Supply Director.
- South/ North Region
members are –
People
 Business unit India – People director Representative.
(Supply) - Representative from
 Technical Director legal
 Legal Function Head team.(South/North)
 Firstly, Plant head and People Business head
from each plant share their grievances with It is the Duty of the
their zonal grievance cell. grievance cell members to
 Zonal Grievance cell should be able to solve Record and file the data.
maintaining a data base will
the issues within 1 week of time frame.
help to address the repeated
 If, the zonal grievance teams are unable to
issues so easily.
solve the issues, country level committee will
take over the issue and will solve it in a
stipulated time.

39
 Country Level IR Committee

Objectives Members Role of Members

Monthly Meeting Monthly Meeting Monthly Meeting -
- To Discuss about the - Supply Director - Director -Employee Relations, will
site wise performance - Technical Director start the meeting by expalining the
and people engagement agenda and order of the speakers
and employee relations - Director- employee plant wise.
issues. relations
- Union Leaders
- Supply director will present on the
- To discuss about - Legal team monthly performance reports.
Meeting the VPO Representative
standards.
- Later, People Heads from each
Yearly Meeting branch will submit their monthly
Yearly Meeting - Country Head reports, followed by union leader
- To discuss the - VP- People Business about their concerns and support
objectives of preparing they are giving to the respective
- DirectorEmployee plants.
IR strategies for the reations
following year
- Country Head
Yearly meeting
- Union Leaders
- To set the goals and - VP - HR, will Initiate the meeting
framework to reach the - Head- Legal team by introducing the members.
IR goals.
- Associate Director-Employee
relations will initate the discussion
on Fixing the IR goals for the
following year.

- All the members will share their

opinions and suggestions.
Frequecny of the meeting
- Monthly Once - VP HR will close the meeting by
Can be done through Video conference summing up all the points
discussed
- Yearly Once
Face to Face meeting in Head Office. - The detailed report of the IR
strategy should be shared by VP-
HR within 30 days of the meeting.

Table – 6

There is no rule that, each issue will be resolved at site level itself. There will be few
issues that are to be addressed by very top-level management in the company. So, this
Grievance redressal mechanism will act as a settlement machinery for the issues and
the country level IR committee will be acting as both preventive and settlement
machinery to resolve the issues and to maintain better employee relations all over the
nation
40
 B. Caluclating productivity linked bonus

As per the Long-Term Settlement (LTS) 2017, management have to give productivity linked bonus
to its employees for 2017-18 period in 2018-19. Management want to give this bonus in the month
of September and they need to calculate it in June itself to get approval from hub office. As the
current HR- Supervisor who is responsible for calculating is transferred to another branch., HR –
Head gave me this opportunity to calculate productivity linked bonus for the period 2017-18.

The outcome of the calculation submitted to the management is as follows - which includes
Average OEE (Overall Equipment Efficiency) and Schedule as per LTS. Along with that,
calculation process is also explained further in detailed.

Table representing the line wise and month wise production and OEE percentage

Month wise and Line wise productivity Monthly Month

Total wise
Line-1 Line-2 Line-3 Productiv Total
Month ity OEE

Cases OEE Cases OEE Cases OEE (In Cases) (In %)

Apr-17 455311 69.9 550815 80.7 929321 76.4 1935447 75.8

May-17 340747 70.9 514606 79.0 846946 77.0 1702299 76.1

Jun-17 405159 67.7 452471 74.4 842850 76.3 1700480 73.0

Jul-17 243958 59.3 289792 69.5 625392 69.1 1159142 66.4

Aug-17 259123 64.8 280342 69.2 507834 70.2 1047299 68.2

Sep-17 289957 66.9 304539 75.6 559289 74.2 1153785 72.2

Oct-17 365337 66.3 407117 73.6 713086 75.3 1485540 71.9

Nov-17 248771 73.7 232860 75.1 391722 71.9 873353 73.6

Dec-17 320893 72.9 305574 72.5 551934 75.5 1178401 73.6

Jan-18 477053 74.0 473345 75.28 871508 80.2 1821906 76.5

Feb-18 372282 73.2 357551 73.76 685885 80.1 1415718 75.7

Mar-18 498856 69.1 497263 71.05 962030 73.0 1958149 71.1

Yearly 4277447 Avg-

4666275 8487797 17431519
Total 72.8

Table - 7, Source- Company Internal Data.

41
 Figure - 11, Source- LTS agreement of ABInBev – CBL Plant

 How Productivity Linked Bonus is given to employees for 2018-19

First, line wise productivity – Day wise productivity data for 2017-18 is to be collected
from the packaging department and on which dates 330 ml bottle is produced on Line -
1, that day - double the cases count for that particular day. Later, OEE percentage
calculation is collected line wise and date wise for 2017-18 by consulting quality
department.
OEE is calculated as No of bottles actually produced dived by Line capacity.
In the final table, Month wise average – line wise average is shown and Total average
OEE for 2017-18 is calculated by taking average of month wise OEE and day wise OEE.
So, as per calculations, employees will get the Bonus of Rs. 34,233 in 2018-19, which
is as per the 73% OEE for the year 2017-18.

42
 C. Presenting ETP Alternative to the Management

Plant Head gave me an opportunity to test my skills beyond the HR function. He gave some data
related to current ETP (Effluent Treatment Plant) water usage of the plant and explained me about
how Pollution Control Board (PCB) is restricting the management to get its 100% production. He
also gave me his own choice of alternative and asked HR head and me to work on the feasibility
of the idea and to prepare a presentation to present for head office people in Bengaluru.

The presentation flow designed is showcased as follows –

 Present situation

As on Date, CBL plant is only producing 75% of the production capacity, as PCB (Pollution
Control Board) is limiting CBL, only to produce 75% of the capacity even though the
company have all resources to reach 100% production Capacity. The major reason behind
it is that CBL plant is able to use the Effluent Water that can be treated with its existing
production capacity for Industrial Domestic Purposes. But, anything above that is can’t
manageable by it. Because, they don’t have more sources to use the effluent water.

 Objectives

The sole objective of this project is to get approval from the PCB board to produce to
the plant’s fullest capacity and also to gain trust among all the stakeholders regarding
their usage of effluents.

 Action Plan

To produce the Remaining 25%, to reach 100% capacity, by Gaining the trust and Getting
the approval from the PCB. To get so, CBL management planned that within a Distance of
20km, there is a PCB approved Effluent treatment plant. So, CBL is planning to send the
extra 200kl of treated water per day that is generating extra, to that ETP. This can clear the
PCB’s Doubts on company regarding the usage of extra Effluents. Which results in getting
approval from PCB.

43
 Costs and Profitability to the company.

By enquiring all the costs, submitted a profitability statement for the first year where high
costs are there and how much money company can make from the following year with
additional production and with this alternative of sending extra ETP water to the nearby
ETP.
As the data is confidential, unable to showcase the statements here.

 Intangible Benefits for the company

 Company will have a Backup plan, to send out the used water to the PCB
recognized ETP whenever they are facing difficulty with our Current ETP.
 They can Build trust among the PCB and other Stakeholders, on the way we do
Business.
 Increasing Production Capacity in turn increases company’s share in the Market
and 100% Utilization of resources can be achieved.

 Presentation and Approval.

Final presentation is given to both corporate office and Pollution control board.
People from PCB are in favour of the proposal, and yet to give the final permission.

44
 CHAPTER -5
- Relevance to the Company
- Learnings
- Conclusion
- Bibliography

45
 Relevance to the company

- The Employee Relations strategy report got approved from VP-People business partner
and Associate director – People Business Partner, ABInBev India. The major suggestions
from the report, that are going to implement in near future are -
 Employee relations Committees
 Grievance redressal mechanisms
 Strategic goals for 2019-2021

- Calculation of productivity linked bonus is very much need of the hour to the company
and the final report on payment given to the management is approved by the HR manager
and Union leaders. This helped the company to make the prompt payment to the
employees as per the LTS.

- Calculating the costs and profits for finding the alternative source for the use of ETP
water helps the company to get relief from pollution control board restrictions and can
produce to the company’s full capacity.

- Other important suggestion offered, which can result in better results are as follows –

 Deploying the contract labour in the workplace as per their abilities and
potential to work.
 No Separate piece rate in the same workplace (for crating it is 55 paisa per
crate and for loading it is Rs.1 per crate)
 Maintaining proper leave cards and attendance. If possible in digital format.
 To provide Training on medical insurance provided to the employees.
 Appointing separate representative for contract labour to make their voice
reach to the management.

Most of the suggestions given to the management are accepted,

but due to some practical constraints like union influences and business situations,
management is unable to implement few of them right now. but for a better future of
business, management is ready to implement them in near future

46
 Learnings

- Observed that the Basic motive of HR should be “Keeping Business in Mind”

- Understood the pattern and cautiousness required in preparing the corporate report, that
is going to be implemented all across the company’s plants in India.
- Understood the Brewing Business in India.
- How productivity linked bonus can be done by compliance and as per the long-term
settlement agreement.
- By working on Business alternative regarding ETP water usage, helped me to understand
the role of HR in carrying on business by best possible ways.
- Understood the difference in Plant level HR functions and Corporate HR functions.
- Learnt that HR people should talk PEOPLE Language.
- Observed that the feeling of ownership is difficult to inculcate among contract labour.
- Understood that, while talking to the Union people, it is better to have a single voice from
the management.
- Observed various Organization Behaviours practically.
- Got to know that for an Employee in manufacturing , Pay- safety-welfare are the three
major issues. Any management that can ensure the best in these areas can create a peaceful
workplace.

“Able to learn what are all the HR functions, that are performed at plant level and how
important it is to maintain better employee relations in the workplace.”

Conclusion
After observing the current business situation and internal environment of ABInBev, it is
evident that a company faces challenges in the initial years after acquiring another company in
the Industry. The major challenge in the due diligence concept in the process of mergers or
acquisitions is “people’ part. ABInBev perhaps didn’t do an intensive exercise and are now
making extra efforts to maintain a strong ‘people’ and ‘culture’ all over its plants in India. It
was a privilege to be part of that process of transition, which helped in gaining an understanding
of the real dynamics of HR which is ultimately related to the Business.
At the same time, this project also provided insights on the employee relations part of the HR
and how crucial it is to maintain smooth employee relations to maintain industrial peace. This
is especially when the union enjoys a hold on the management.
Overall, the exposure in the internship period helped in gaining comprehensive understanding
of the brewing Industry, Business, organization’s culture and the important role of HR.

47
 Bibliography

- HRD and Labour law referencer by H.L.Kumar, Ministry of human resource

development India, 2017
- Human resources champions by Dave Ulrich, Harvard Business school press,
2008.
- Labour and Industrial laws by P.K.Padhi, PHI learning Pvt ltd, 2017.
- Employee First- Customers second by Vineet Nayar, Harvard Business school
press, 2015
- “ABInBev-Employee Relations strategies Report” of Australia and Europe.
- Long Term Settlement agreement between union and management of ABInBev
– CBL plant for the period 2017-2020.
- “Contract Agreements” Between Management and Contract labour suppliers.
- Exit Interview Documents
- Training calendar and related evaluation documents.
- Yearly production documents from Packaging and Quality department.
- Documents related to Union conditions and nature in all Manufacturing plants of
ABInBev India.
- https://scoophub.in/top-10-best-beer-brands-in-india/
- https://firstwefeast.com/drink/learn-how-to-brew-beer-with-these-fun-animated-
gifs
- https://ab-inbev.ecurso.com.br
- http://pestleanalysis.com/pestle-analysis-india/
- https://www.lawfarm.in/blogs/alcohol-laws-in-india

48
Annexures

49
 Annexures

Celebration on Achieving Highest Plantation on the eve of world

Production in ABInBev India – 1,13,238 environment day on June 5th
Cases on 15th may, 2018

Occupational Health Centre with a Medical Industrial Canteen, that serve food to
officer to attend emergencies and first aid the employees at Rs.2 per meal and
Rs.1 for Breakfast and Snacks

50
Interview structure in ABInBev for supervisor and Manger level jobs. This document acts
like a guide at each and every step with some predetermined questions and assess the
candidate’s performance by collective feedback from the interviewers

51
Monthly KPI Dashboard which consists of all crucial areas from all
the departments. This dashboard is updated time to time by the
respective managers themselves. This board is located near the Time
office.

As per the wage agreement between management and contractor

who provides contract labour, company pays Rs.622.67 for every
labourer per day.

52