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Nokia Restates that Redundancy Plans for Indian Factory are Voluntary

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Nokia has reitterated that its offer of voluntary redundancy at its Indian handset factory is voluntary and dismissed reports that staff are being forced to leave the company.

The Chennai based factory is the company's largest, but has been scaling down its production as Nokia phone sales dwindled, and ahead of its planned sale to Microsoft.

The entire workforce, of around 8,000 staff has however been offered redundancy, which has sparked speculation that Nokia may seek to close the factory instead. It is currently embroiled in a tax dispute, and the Indian authorities seized the factory assets as collateral pending the legal outcome of the dispute.

In a statement, the company said simply that "As a responsible employer, Nokia is offering a clear financial option for interested factory employees."

In the meantime, in order to avoid the tax dispute holding up the sale to Microsoft, Nokia will keep ownership of the factory until the tax issue is resolved, and if necessary it will operate as a contractor to Microsoft after the handset division is sold.

"During that period when we provide these services to Microsoft, we will look in this difficult situation to find the best long-term solution for both the factory and the workforce." the company's interim CEO Timo Ihamuotila stated.

The Microsoft deal is scheduled to be completed this month, a little later than originally expected.

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Tags: nokia  chennai  India