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BW Businessworld

Take This As A Warning

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The events in the Manesar plant of Maruti Suzuki have been shocking for a number of reasons. Industrial unrest is not uncommon, and this country has mechanisms to deal with it. Labour laws are not perfect; their implementation is even less so. But by and large, the problems that inevitably arise in industry have been tackled peacefully. The level of violence and lawlessness in Manesar was exceptional. Second, Maruti is India's largest car manufacturer. Although it is also the oldest surviving manufacturer. It did not reach the top of the industry without merit. It has been a remarkably well-run company; it is difficult to imagine that it harboured such intense dissatisfaction amongst workers. And finally, the murder and mayhem in Manesar have made news which has been carried round the world. It is an event which will haunt India and affect its international image.

After a series of brief conflicts in the late 1990s, Maruti enjoyed a decade of peaceful industrial relations. This period of truce came to an end in June last year, when workers in Manesar struck over the right to form an independent union. The current strike is the fifth since then. Factories go off the radar when they are peaceful; as soon as they are on strike, they become hot news. Journalists meet workers at such times and list their complaints. A common thread amongst the workers' demands has been that they want to form a union of their own, independent from the company. But a union is necessary only if workers cannot get what they want by talking face-to-face with the management.

 The Maruti dispute is not about wages; it is about working conditions. The high work standards of Japanese factories are well known; and Japanese companies take the same standards to their factories abroad. This is particularly true of vehicle factories. Cars are universally produced on assembly lines which move at a constant speed; a worker simply has to complete the work assigned to him in the seconds during which the half-made car passes him. Some of the work processes the Japanese insist on may sound inhuman to office-going Indians; but thousands of people all over the world have got used to them.

Work on an assembly line is not fun. But with it are associated a regular wage and expectations of doing better. It is these expectations tied to a job that keep people slogging and, perhaps, even happy.

This is where things appear to have gone wrong in the Manesar factory. Workers have complained about the serious loss of earnings they face for small derelictions. Many of them obtained employment through agents, and do not enjoy the same security of service and expectations of doing better that permanent workers do. There is something that Maruti got right in Gurgaon and now seems to have got wrong in Manesar. This difference needs to be identified and addressed.

Unfortunately, it seems that the parties to the dispute have not been very good at doing so. This is not unusual. In all democratic countries, governments provide a service that guides employers and workers through negotiation, arbitration and adjudication. The machinery has been there in India for decades. But it has never been effective.

Government departments have to compete to recruit personnel; in this competition, labour departments do badly because they offer poor pay and poorer working conditions. In any case, matters have gone so bad in Manesar that hundreds of people may become embroiled in suits. Courts are not good at bringing people together, and take years to reach a conclusion. So the prospects of a satisfactory resolution by official means look unfavourable.

That leaves one other mechanism. It was used often in British times, and continues to be used in Britain to this day. It is a commission of inquiry. The last time it was tried was quite recently: the government appointed three interlocutors to look for a solution on Kashmir. It failed; it went through the labours of talking to people, analysing the problem and framing recommendations, but they were put into cold storage. Still, it is worth trying in Manesar. For the facts are themselves not very clear here; a straightforward account of what happened and why would clear the air.

The present government prefers to keep out of sticky situations and leave things to worsen on their own. But this situation is different; it is being watched abroad, and the perceptions that emerge will go towards forming India's image. The government should not paint a rosy picture of what happened; it should set an example of objective observation.

(This story was published in Businessworld Issue Dated 06-08-2012)