New Delhi/Mumbai: The Supreme Court said on Wednesday that the government was free to go ahead and notify the recommendations made by the G.R. Majithia wage board for journalists and non-journalists in the print media industry.

The government, which has been ducking the controversial issue by claiming it was before the court, will now have to consider, accept, or amend the recommendations. However, media companies won’t have to implement them till the court rules on the recommendations.

The court clarified that the Union cabinet could notify the recommendations, but this move would be subject to the outcome of the case filed by publishing companies, currently pending before the court.

If implemented, the recommendations could increase the salaries of journalists and, in turn, raise the wage bills of newspaper companies by 60-100%.

The petitions opposing the wage board were filed by ABP Pvt. Ltd (that publishes Anandabazar Patrika), The Times of India publisher Bennett, Coleman and Co. Ltd (BCCL), and news agency United News of India (UNI).

The apex court had on 18 July asked the government to refrain from taking any decision on implementation of the recommendations of the wage board for two weeks. The Justice Majithia Wage Board was constituted in 2007 to review the salaries of journalists and non-journalists employees at newspapers and news agencies.

According to K. Sreenivas Reddy, secretary general of the Indian Journalists Union, a body that represents the interests of 20,000 journalists, the Union cabinet can now accept, amend or scrap the recommendations altogether.

Reddy said the Supreme Court’s order spells relief for journalists on wage board salaries. “We can now press the government to notify the recommendations. It is a court order after all," he said. Reddy works for Vishal Andhra, a Telugu daily with 100-150 employees. According to him, nearly 80% of the employees working in various Andhra newspapers are on wage board.

Other unions such as the Madhya Pradesh Working Journalists Union (MPWJU) and the Confederation of Newspapers and News Agency Employees Organization also welcomed the Supreme Court’s order. The unions say newspaper publishers are flush with funds due to growth in advertising and more editions. An increase in wage board salaries is justified, they said.

Publishers see the recommendations as a blow to their companies.

Typically, manpower costs account for 20-25% of the total cost of a newspaper, second only to the newsprint cost. If the cabinet approves the draft wage board recommendations, publishers see these costs jumping to 70-100% of the total cost, making operations unviable.

Earlier this year, Kasturi and Sons Ltd, the publisher of The Hindu and The Hindu Business Line, analysed the financial impact of the wage board proposals. If implemented, it would add roughly 100 crore to the company’s wage bill a year. At Kasturi and Sons, of the 3,800 employees, only one-third of the staff is outside the purview of the wage board.

Gujarati newspaper Bombay Samachar said the move could increase wage bills by 100% for most publishing houses. Hormusji Cama, director, Bombay Samachar Pvt. Ltd and chairman of Media Research Users Council that conducts the Indian Readership Survey, said that smaller newspapers would be forced to shut shop if the recommendations were implemented.

“The Indian Newspaper Society (INS) has directed members to boycott the recommendations of the Majithia report simply because the recommendations are impossible to implement," Cama said. Cama is an INS member.

Kundan R. Vyas, editor of Janmabhoomi Group and president of INS declined to comment, “Since the subject is sub judice, we will not be able to comment," he said.

Asked about the Supreme Court’s order, Ravi Dhariwal, president (print), BCCL, said: “The court hasn’t said that the recommendations will have to be implemented. The cabinet has to first hear it."

Nearly 8% of the journalists at The Times of India and 14% of non-journalists are on the wage board scale. BCCL will also see its annual wage bill go up by over 20% if it revises the wage board salaries.

Mint, published by HT Media Ltd, competes with BCCL’s financial daily The Economic Times. It also competes with The Hindu Business Line, published by Kasturi and Sons Ltd. Executives at HT Media Ltd declined to comment.

The government should not decide wages for any industry, leave alone the fourth estate, said Akila Urankar, president, Business Standard Ltd, which publishes financial daily Business Standard. “Even within media, only newspapers have wage boards. Radio (stations), TV (channels) don’t. The recommendations, if implemented, will kill small and medium newspapers and impact the profitability of the larger ones," said Urankar.

Paresh Nath, president of the Indian Languages Newspapers Association and publisher of Delhi Press with magazines including Sarita, Saras Salil and The Caravan in its portfolio, pointed out that the wage board had taken only 30-40 newspapers into consideration while coming up with the recommendations. But there are over 75,000 newspapers registered and the smaller ones could perish if their costs increase.

In 2009, there were over 75,000 registered newspapers in India, according to the Registrar of Newspapers for India. Advertising revenue for print media is set to grow from 12,600 crore in 2010 to 23,600 crore by 2015. Though advertising has slowed, the print sector will continue to grow at 12-13% per annum, according to Jehil Thakkar, executive director and head of media and entertainment at consulting firm KPMG India Pvt. Ltd.

PTI contributed to the story.