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"The [contract labour] union members have resorted to an illegal strike from the beginning of the first shift on August 12, 2011," a spokesperson of Dr Reddy's said.
There is some effect on production, he said but did not elaborate by how much the output from the factory has been reduced due to the stir.
DRL's facility at Srikakulam has an annual capacity to produce 450 kilolitres of APIs, he added.
The company is quite positive that the union and contractors will come to an amicable settlement at the earliest and that normalcy will be restored, he said.
The workers who have been demanding better salaries, said they would intensify the agitation till their demands are met.
"All the contract workers have been working with the company for the past 15 years with meagre salary. Government order says that if a contract worker discharges the duty of a regular worker, he should be paid equal salary with that of a permanent employee. DRL never followed that," Centre of Indian Trade Unions (CITU) leader Govinda Rao representing the agitating workers said.
DRL, however, said the contract workers were employed through contractors to whom they had submitted a charter of demands. The company blamed the workers for going ahead with the strike despite Joint Commissioner of Labour, Vishakapatnam asking them not to do so.
When contacted, a contractor who provides workers to Dr Reddy's said that he had no role in salary fixation for the workers.
The Joint Commissioner of Labour has called for a meeting on August 25 to discuss the matter.
The workers at DRL's manufacturing facility at Srikakulam resorted to strike after the talks failed with the management on August 11.
Shares of Dr Reddy's Laboratories today closed at Rs 1,505.55 on the Bombay Stock exchange (BSE), up marginally from its previous close.
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