Sahara Group's long-drawn dispute with market regulator Securities and Exchange Board of India (SEBI) over investor repayments has started to take its toll on salaries of the group's employees, which are getting delayed amid a major liquidity crunch.
The salary delays are mainly being faced by the staff members in the corporate offices of the crisis-hit group, while there are also delays on certain statutory payments and operating obligations or expenses related to day-to-day business due to difficulty in fund flows.
When contacted, a Sahara spokesperson confirmed the delays in salary and other payments, while adding that the junior staff members are being given priority for the payments.
"We are working to diffuse this crisis, which has also created grave difficulties for our employees. Sahara India is one big Pariwar (family) and all the employees are its members, who are standing together in these difficult times. "With our dedicated employees and the strong fundamentals of the group, we are hopeful that we will soon come out of this crisis," the spokesperson had said.
The group has over 10 lakh full-time and part-time employees, including permanent staff at its various companies, permanent agents who get regular incentive payments besides a large number of part-time agents.
While the exact number of persons whose salaries and other payments have been delayed could not be ascertained, sources said their numbers could run into "tens of thousands".
"The group is facing a liquidity crunch for past one year due to embargo and double payment (for investor refund), resulting into many problems like meeting the salary, statutory and other operating obligations/ expenses in doing business," the spokesperson said.
"We are however releasing the salaries time to time based on the fund flow on a continuous basis. The delayed salaries of junior staff were released just a few days back as extra care has been taken for our junior staff. Soon salaries of other brackets will be released," he added.
"In some business divisions, salaries of our employees have got delayed by many months. However, situation is better at those divisions, which have their own fund-flow like the Group's luxury hotel Sahara Star in Mumbai, resort town Aamby Valley City and the 500-bed tertiary care Sahara Hospital in Lucknow.
Replying to queries on salary delays, the group spokesperson said, "For the past 14 months, Sahara India group's all kinds of assets and bank accounts are under embargo of Supreme Court and there is an extra burden of demand of double payment against single liability in Sahara-SEBI case."
Sahara is trying to raise necessary funds to secure release of its chief Subrata Roy, and two other officials, from Tihar Jail where they have been lodged for almost a year in connection with the investor repayment case.
The group was asked by the Supreme Court in August 2011 to deposit over Rs24,000 crore with SEBI for refund to investors. Sahara, which has deposited some instalments since then with the market regulator, maintains that it has already refunded over 95% of investors directly.