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A foreign direct investment company, Mountain Hazelnut (MH) Venture, has sent most of its staff on unpaid leave for three months with effect from June 1 as a cost-cutting measure.

Officials said the decision to send the employees on leave was made as an interim measure while they were refining their operating model for sustainability in the light capital crunch.

From more than 450 permanent employees besides 300 plus casual workers as daily wage earners in its three nurseries, the company is employing about 150 people on a rotation basis in the next three months.

MH Venture employees are worried.

A field staff in a gewog in Trashigang said he is worried how he would pay his house rent and employee loan repayment. “I also have a family to support.”

Another employee said it’s difficult to find job immediately and the company should have informed earlier although he could understand the situation.

He joined the company in 2013 after signing a contract for 30 years.

A field staff in Mongar said he is the eldest among the siblings and got loan to repay and siblings’ school expenses to support.

He said the company’s service rule mandates the company to serve a prior notification. “The service rule states that a notice must be served before three months for those who hold key positions and one month for an ordinary employee.”

The MH’s chief executive officer, Dr Sean Watson, explained that while this step might seem sudden, the company has been mindful of its budgetary constraints and started maintaining stringent cash conservation measures from December 2020. “MH was hopeful that it would be able to secure funds before exhausting the resources, but due to ongoing Covid-19 restrictions on foreign entry, investors could not come.”

He said the pandemic has brought unprecedented hardship to the company, as it has affected many other companies in Bhutan.

He said the nationwide lockdown also hampered the business, as the company was not able to collect most of last year’s harvest. “As a result, the company missed some key investor funding milestones.”

Dr Sean Watson said every aspect of operation from land registration to bringing in tissue culture, procuring materials from India, distributing trees and performing an audit has been affected by the pandemic.

MH officials said the company has been also in close consultation with the labour and human resources ministry (MoLHR) on the interim measure and MoLHR officials have been understanding and supportive, guiding MH in line with the same principles that other private sector organisations in Bhutan have been abiding by since the start of the Covid-19 pandemic.

They also said that while they are currently working on redefining its operating model to make it sustainable in future, the company is also not certain if all the employees would be retained upon completion of their leave period.

MH officials said they firmly believed that hazelnuts are a viable business and suitable for Bhutan, but requires some additional time and investment. “Once the company has the funding to transition its operations to a long-term sustainable basis, it hopes to bring most staff back to work based on the needs of the refined operational model,” an official said.

Meanwhile, some employees have already started exploring new jobs after their company informed of the leave and a construction site in Gyalpozhing has employed 13 of the MH employees. The site supervisor is willing to take additional employment with the wage differences for skilled and unskilled labour.

By Tshering Namgyal | Mongar

Edited by Tashi Dema

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