Unrest on the shop floor

Anger over the use of lower-paid contract workers is simmering

On a late Wednesday evening in July 2012, more than 3,000 workers went on a rampage inside the administration block of Maruti’s Manesar unit, provoked by the management’s refusal to reinstate a worker, who was suspended on the grounds of beating up a supervisor. A day later, the police found a body on the first floor of the main building. It was so badly burnt that the deceased could be identified only with the help of his dental records. He was Awanish Kumar Dev, general manager (HR) at Maruti’s Manesar plant.
 
The autopsy report said Dev had been beaten with iron rods and left unconscious to be burnt alive in the administration wing of the plant. Another 25 executives were also assaulted but were luckier than Dev as they could be shifted to the emergency ward of a nearby hospital on time. Dev’s ghastly murder obviously had nothing to do with a “spontaneous mob violence” as was being claimed by some union leaders, but was part of a carefully planned conspiracy. It was evident that an uneasy relationship between the Maruti management and its workers was at a boiling point for quite sometime. Many workers were clearly unhappy about the reported failure of the management to implement several clauses in a tripartite agreement that was signed a year ago before they decided to call off an earlier strike.

 
Dev’s killers were punished last week, close to five years after India witnessed one of the worst cases of industrial violence.  But it was certainly not an isolated incident. On September 22, 2008, the CEO of Graziano Trasmissioni, the Indian unit of an Italian auto component maker, was clubbed to death by a group of 200 workers. In another incident, in September 2009, the vice-president (HR) of Pricol was beaten to death by agitating workers. A year later, an assistant general manager of Allied Nippon, an auto parts maker, was stoned to death by angry workers. And in March 2011, a deputy general manager (operations) of Powmex Steel, a unit of Graphite India, was killed after his vehicle was set afire by irate workers. 

 

While these incidents of violence are nothing but criminal actions and are rare, the fact is that labour unrest and volatile environment on India’s shop floors have increased over the years and most of these resulted from the simmering anger over the use of lower paid contract workers. The latest was in February this year when 351 temporary workers lost their jobs at Omax Auto, leading to the suicide of one employee.
 
After all, when a large number of contract or temporary workers within a company get paid a fraction of the salary earned by permanent workers, differences surface within the workforce. The living conditions of this section of workers are often miserable.

 
Contract workers make up nearly 30 per cent of India’s workforce, with manufacturing companies accounting for almost 40 per cent of jobs. The leaders in this category are energy and utility, cement and automobiles. In November 2014, the government amended the Apprentices Act to provide employers with greater flexibility such as deciding hours of work. Unions, however, say the amendments have made it easier to use apprentices instead of full-time workers.
 
Therefore, there was no surprise when a Ficci survey ranked “strikes, closures and unrest” as the major risk affecting the Indian economy. This was in sharp contrast to the previous year’s survey results, in which “corruption, bribery and corporate frauds” emerged as the topmost risk. Strikes and lockouts involved 95,297 workers leading to 445,986 man-days lost.

 
The bigger problem, of course, is lack of jobs in a country where 10 million people aspire to enter the job market every year. The Organisation for Economic Co-operation and Development raised the issue in its February report. Pointing out that India has been creating “too few quality jobs” to meet the aspiration of its growing workforce, leaving many people underemployed, poorly paid or outside the labour force, the report said the employment rate has declined and job creation in the organised sector has plummeted since 2010. A big part of the reason is skills shortages. In fact, more than half of employers have time and again reported recruitment difficulties because of talent shortages. That is understandable as just about 4.7 per cent of the total workforce has undergone formal skill training.

 
The government and India Inc need to do some hard introspection on the issue.