MANESAR, a village on the outskirts of Delhi, was front page news in July 2012. And for all the wrong reasons. A small habitation just beyond Gurgaon in Haryana, its claim to infamy was for the labour violence that erupted at the automobile manufacturing plant of Maruti Suzuki India Ltd. Workers at the plant had been agitating for months for their right to form a trade union through which they could air their grievances in an organized and legal manner. A very small incident was the spark that literally lit the fire. An altercation between a supervisor and a worker was coloured by allegedly casteist remarks, initiating large-scale violence within the factory. Sufficient damage was done to the offices and furniture which tragically resulted in the death of the general manager of human resources whose broken legs foiled his attempts to escape the raging fire. He was burnt to death.

Was this just a random incident or is it a precursor of things to come? Is there a dramatic change in the mentality of labour, the attitude of employers, the intervention of regulators, the conditions at the workplace, and the perspective of society and the polity? Where does this changing attitude of industry, government and the casual nature of employment leave the labour movement?

Trade unions and workers’ organizations are essentially a product of modern large-scale industry. Workers’ guilds existed before the stage when workers were employed in industry and the initial inspiration for unions emanated from these. However, even though the first workers’ organizations in India were formed in the latter half of the 18th century, these were more in the nature of strike or negotiating committees formed to negotiate specific demands with the owners of factories and promptly disbanded subsequent to negotiations. India did not experience a gradual transition from old to modern methods of production and as such did not have well-knit bodies of skilled craftsmen which formed the backbone of trade union development in western countries. These initial organizations were unstructured to the extent that they did not have any form of permanent membership or constitution.

The first organization on the lines of a modern trade union was formed in India in 1918 by the workers at the Buckingham and Carnatic Mills in Madras. By 1920 a large number of unions had been organized in a variety of industries, the largest and most notable being the Textile Labour Association of Ahmedabad, which Mahatma Gandhi mentored and counselled. The immediate and imminent offshoot was the organization of a federation of trade unions, the All India Trade Union Congress, whose first session in 1920 was presided over by Lala Lajpat Rai, President of the Indian National Congress. It is necessary to emphasize that the contribution of political leaders, both of the nationalist and communist variety, cannot be undervalued in this initial period. Though there were fundamental differences in their motives – the INC guided by humanitarian and political considerations and the communists viewing unions as an organ of class struggle – politics was the birthmark of the Indian trade union movement. Public men led the movement and the organizations and undertook the difficult task of organizing the disparate and often illiterate working masses.

 

The Trade Union Act 1926 gave these organizations a legal bearing and defined the structure of the organizations. The statutory requirement of registration with the government gave these organizations the legal sanction and recognition that they needed to represent labour in negotiations. It also indicated to the management the structure within which bipartite negotiations could take place. The Industrial Disputes Act 1947 provided the tripartite and legal structure for the resolution of disputes that could not be resolved by bipartite negotiations.

By 1950 there were three national federations of labour: AITUC (captured by the communists), Indian National Trade Union Congress (formed in 1947 by the INC), and the Hind Mazdoor Sabha (formed in 1948 by the merger of Hind Mazdoor Panchayat of the socialists and the Indian Federation of Labour, a breakaway group of the AITUC ). Later additions were the Centre for Indian Trade Unions (of the CPM) and the Bharatiya Mazdoor Sangh (formed by the Jan Sangh). Of these, the HMS had no overt or covert association with any political party, a situation that continues to this day.

The period 1947 to 1990 saw a large number of legislations that protected the rights and security of workers. There are close to 200 acts that cover workmen, and the governments and legislators are to be lauded for their proactive role during this period. This was a period of a specific and universal mindset. Workmen were perceived as the ‘labour force’, an asset for the country, valuable because of their contribution to production, and therefore to be treated with the appropriate deference. They were also perceived as the labour wing of political parties which subscribed to various ideologies. Trade unionists were active in politics, successful in getting elected to office and able to influence the government of the day to take decisions that benefited the poor and the working classes. The most notable were the nationalization of banking and coal. Political ideologies were either right-wing or left-wing (with shades of pink in between) and this was well reflected in the party manifestos.

 

By 1990 the situation had changed dramatically. Caste was a major political magnet for vote gathering and religious fervour entered the arena of political activity. Issues of labour were relegated to the background. 1991 saw the entry of a new politico-economic thought. Issues of distribution of wealth were disregarded and policies for generation of wealth were accorded the first right. Assurances of a trickle down effect were fielded as a sop to the working classes and expectations of huge employment generation were fielded as a defence for the new economic policies. Employment security was put on the back burner. The job was the grace. Real wages were expected to rise even as job security was sacrificed at the altar of full employment. The time of the ‘labour market’ had come.

The tragedy has been that in the last 20 years India has seen a whole spectrum of political parties holding the reins of power at the Centre, but none were able to amend the policies initiated in 1991. Be it the Congress, the initiator of this economic philosophy, the Janata Dal or the BJP, all have left the economic policies of their predecessors intact. The working class movement has lost its influence on the polity and the trade union federations are responsible for this.

 

Approximately 7% of the Indian workforce is organized, 93% is unorganized. There are approximately 70,000 registered trade unions in the country claiming a membership of about 3.5 crore. Assuming a working class population of 40-45 crore, this does convey a dismal picture; 41.5 crore are unorganized. The GOI conducts a verification of membership for all central trade unions. The last such verification was done on the basis of claimed membership for the calendar year 2002, the results of which were published in 2008. Thirteen federations were accorded the status of Central Trade Union Organizations. All put together, their verified membership was 2.46 crore. A huge chunk of the workforce is outside the cover of union organizations and have no recourse to collective bargaining. And market forces of supply and demand are to determine their price.

For the decades after independence to the nineties, the proximity of trade unions to the polity, their influence on the economic policies of political formations, and their success in pushing through legislation which was favourable to the working classes led to a sense of complacency. A majority of their stable membership came from the public sector (including railways) and large industry and it is on the shoulders of these workmen that the federations wielded influence. The unorganized sector continued to languish, even as the new policies post-1991 saw a steady drain in permanent employment and the conversion of a permanent workforce to one of a contractual and casual nature. Out-sourcing of perennial jobs became a strategy for management to reduce costs and to shy away from assuming the responsibilities of a permanent workforce with its social security benefits. This has now become a norm, not only in the private sector but in the public sector as well.

 

A look at the 10 sectors where a majority of the 93% find employment reveals the gravity of the situation. The table below shows the sectoral verified membership of the top five CTUOs as of 2002.

50% of the verified membership of the top five CTUOs is in these 10 sectors. 60% of the membership in these 10 sectors comes from agriculture and miscellaneous. Work among agricultural workers does lag behind but the labour movement has been able to extract substantial benefits for beedi workers.

 

The disappearance of the political class from the leadership of the labour movement has isolated those who continue to organize labour and share their struggles. Politics has become a game played by moneybags. Even cadre-based parties like the ones on the left and the BJP have rebuilt their political strategies to the exclusion of the labour vote. Before the advent of obvious caste and religion-based politics it was in the interest of political parties to assimilate and control the labour class. Workers were perceived as committed vote banks and performed to the satisfaction of their ideologies.

In industrial centres and constituencies which had a sizeable (though never a majority) and organized labour force, the result could be dictated by them. This was the basis of the historic win of George Fernandes over S.K. Patil. This situation no longer exists. There is also a distinct lack of faith of the workmen in established trade union organizations. This is in large measure due to the inability of trade unions to protect their members from the repressive and vindictive action that management has traditionally indulged in as a first response to workers agitations. Having come full circle, labour demands are perceived less as an industrial relations problem and more as ones of law and order. The first call is to the local police station and not to the union leadership.

 

In Parliament today, the voice of labour is feeble. It is impossible for a labour leader to be elected as a representative of the people. This is only partly due to the weakness and shrinking base of the labour movement. To a large measure this is also due to the changing character of the political class and the expectations that the constituents have of their representatives. The first blow to the character of the polity was struck by the introduction of the local area development fund. With direct recommendatory powers for development projects, it became a negotiating tool for seeking votes. It also diluted the role of the politician from an agitationist to become a part of the executive. The subsequent involvement of the political class in purely executive decisions to the exclusion of framing policy, changed the entire flavour of politics.

In organized industry, after many decades of negotiated settlements, the structure of wage negotiations assumed a standard format. The periodicity of wage negotiations was fixed and the intervening years in between were spent in effective implementation. This required fewer agitations and the trade unions started to lose their militant flavour. The unorganized workers and society at large lost the confidence that they once had in trade unionists and a vacuum developed.

Like all vacuums this too got filled. Today a large number of trade unions operate without any affiliation to a central federation. Of the total 3.5 crore organized workers, 2.46 crore are affiliated to one of the thirteen federations recognized by the GOI. One crore workers are represented by trade unions which have no affiliation to a central federation.

 

Post-1991 economic policies demanded of the political class to focus more on GDP and less on minimum wages and this made for many compromises. One of these was to give benefits to industry that went beyond the demands of policy. The other was the dilution in the implementation of labour laws. Since this could not be achieved by legislative means due to resistance from labour organizations, the back-door method of ignoring violations was put in place. Even specific complaints by trade unions were ignored by the labour department. At the same time the government started to discourage the registration of labour unions. In the case of the Maruti Union in Manesar, the Government of Haryana’s Registrar of Trade Unions repeatedly rejected the application on flimsy grounds. It is alleged that this was done at the behest of the chief minister.

Though the Maruti incident highlighted the difficulty of trade union registration, it is less a reflection on procedure, more on the attitude of government. Post-1991, the attitude of industry (both domestic and MNCs) was to look on existing labour laws and organized labour as an impediment to competitive pricing and industrial growth. One of the initial proposals – of diluting labour laws to introduce a system of ‘hire and fire’ – has been successfully stalled by trade unions so far. However, the demand of industry on this score has not abated. To look on labour purely as a commodity whose price can be determined on the basis of supply and demand is a wrongful dilution of human relations.

All factors of production, except labour, are unemotional and inanimate and have no opinion on who employs them. Labour cares. It cares about the character of the employer, the attitude of the management, the environmental and health hazards at the workplace, the conditions at the workplace and even the caste of the supervisor (as the Maruti-Manesar incident indicated). To try to negotiate the basic issue of wages and working conditions on purely hard core economics will invariably create tensions at the workplace. These tensions are not new. For more than a century these tensions have been dissipated by skilful handling of established trade unions.

 

The Manesar incident clearly demonstrated that there is no substitute for long practice in negotiations. The Maruti Union had no central affiliation, primarily due to the attitude of the management which did not want it. The tensions at the workplace were not created due to abysmally low wages or extremely bad working conditions. The factors which contributed in large measure to labour unrest were: a large proportion of casual workers in jobs of a permanent nature, a large wage differential between casual and permanent workers, an extremely disciplined workplace atmosphere and the lack of a democratic attitude revealed in the resistance of the management to the formation of a trade union.

Outside of the factory, the casual workers resided in colonies closely resembling hovels reminding one of the dhouras of private sector coal mines. These underlying tensions were waiting to erupt, which they did on 18 July 2012. Notable is the post-incident behaviour of the management. On reopening the plant, the management did two things; they dismissed more than 500 permanent workmen for their ‘alleged’ hand in the violence and started a process for converting casual workers to permanent ones in a phased manner. A lesson had been learnt as was indicated by the Japanese corporate executive who admitted that maybe they had misjudged the situation.

 

Workers’ struggles today have moved away from the traditional issues of wages and working conditions. R&R for land losers, environmental damage due to polluting plants, and indirect employment in casual and manual jobs to the local population form a large part of the platform for agitations. These struggles are not necessarily led by trade unionists. Civil society leaders are active in these agitations and the management has on its part moved away from the structured format of negotiations defined by the Industrial Disputes Act to sit across the table with non-union formations to hammer out a bipartite consensus. It is not surprising that political parties actively take up these issues directly as they have a potential to gather votes. The marginalization of organized labour from the polity is thus reinforced.

The movement from ‘labour force’ to ‘labour market’ in the mindset of management has major attendant risks. It is not an exaggeration to infer that the presence of a trade union at the Manesar plant would have resolved the issues at the workplace by bipartite or tripartite negotiations. The Haryana government, right up to the chief minister, went beyond their defined limits to display an industry friendly attitude. But the human element of labour refused to accept the situation and rose in revolt. With no recognized organization, the labour force went into violent mode.

It is for industry to recognize that labour is not only a simple factor of production but an asset that needs to be cultivated, negotiated with and then used to its fullest potential.