Friday, March 28, 2014

Toyota Strike And The Scourge Of Contract Labour

Originally posted at the Countercurrents website 

The stand-off between Toyota India and its 6,400 employees in Bangalore continues. Members of the Toyota Kirloskar Motor Employees Union have now downed tools. Toyota Kirloskar Motors Vice Chairman - External Affairs Shekar Viswanathan . He said the issue with the workers' union at the plant has now gone beyond the wage hike negotiations.

Toyota, halted production at its two factories in India and locked-out workers who have refused to sign an undertaking of good conduct but have now lifted the lock-out but workers declined to return to work. Besides company's security guards, state police personnel have been stationed around the twin plants in Bidadi industrial township to maintain law and order.

Negotiations over a wage increase have been taking place for the past 10 months. The union is demanding a wage rise of Rs 4,000 per month as against Rs 3,050 proposed by the management. So far 48 rounds of talks have been held with the management, which include 7-8 talks in the presence of state labour department and union lowered its demand from the original Rs 8000.

Toyota had said that "certain sections of the employees have resorted to deliberate stoppages of the production line, abuse and threatening of supervisors thereby continuously disrupting business".

The TKMEU general body met on Saturday and said they were ready to resume work on March 24 but would not sign any undertaking. The union had also sought withdrawal of suspension of 17 employees. Toyota ruled out compromising on discipline and said the suspension of some workers on disciplinary grounds would be withdrawn only if they apologise first.

"Discipline is required when you are in an industrial environment with a large number of workers. They need to obey rules. The words compromise and discipline don't go together," Shekar Viswanathan told PTI. We have suspended workers and inquiry will be conducted to decide what action must be taken...If they apologise, we are willing to take them back but if they don't, we have to take remedial action," Viswanathan said, without elaborating.

500 workers, who were supposed to enter the factory at 6 AM for the first shift, refused to do so because they were asked to sign the undertaking.

"We have not resumed work today. We had said the company should lift lockout unconditionally and we will not sign any undertaking as desired by the company," Toyota Kirloskar Motor Employees Union (TKMEU) President Prasanna Kumar told PTI. "We had gone there...but they have not allowed us in. They are insisting that we have to sign the undertaking," he said.

“As we are against giving or signing any undertaking, none of us has entered the factory for the first shift which began at 6.00am,” he told AFP. “The undertaking is against our rights as workers. We have a right to protect our interests and ensure that our welfare is not jeopardised.”

Kumar said, "The undertaking sounds like we are accepting the lockout notice that blames us for issues related to delay tactics in work, threatening supervisors.....It also asks us to follow all rules, regulations or orders laid upon us without questioning it. Whatever they say will be final. It talks about not using mobile phones and the installation of electronic devices and cameras, which shows least respect to our basic rights."

1,500 workers at the Toyota plants are contract workers. Today, contract employees account for about 34% of the total workforce in India's top publicly traded companies. The share of contract workers in the total workforce is as high as 47% in the automobile sector which has witnessed the most labour-related disturbance in recent years.

 In a background analysis of the situation observes that the preference of companies to employ contract labour is explained by India's labour laws, such as the Industrial Disputes Act, 1947 that requires both compensation and prior permission from the government for laying-off of workers in firms employing more than one hundred workmen. This has led companies to hire labour through contractors, helping to keep many of their employees out of the regular payroll, thus escaping the provisions of the Act.

Effectively, contract labour provided companies with the flexibility to hire or fire based on business conditions, while undercutting the power of the unions. This presented companies with a luxury they could not afford otherwise, but more importantly it brought into focus the relationship between regular and contract workers. Contract workers could cooperate—or effectively unionize—with regular workers and demand higher wages and benefits. Or they could compete with regular workers, forcing them to perform better, accept lower wages, or simply perish.

During the previous 2012 Maruti strikes, the demand to offer regular employment to contract workers formed an important part of the agenda of protesting workers. Both regular and contract workers colluded to take on the management. But in the Toyota episode, there does not appear to be the same kind of solidarity. In fact, according to some Toyota union members, the management continued to operate the plant during the lockout with the aid of contract workers and management, undermining the power of the Toyota union.

The advent of competition in the labour market with the entry of contract labour has coincided with greater uncertainty in the power of the unions. Toyota's tale points to an underlying story of management taking advantage of decreasing labour union power, who fear a decline in the bargaining power from an influx of contract workers in a relatively open labour market.

As Kumar pointed, at the commencement of the dispute the company, was trying to bring in a new work culture "with more production for less pay". He had earlier explained.

As of the 28th, the workers have still not returned to work with management using office staff and contract workers plus apprentices to try and break the strike.

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