We will de-recognise this union completely, says Chief Operating Officer

In the summer of 2011, production at Maruti Suzuki’s Manesar plant ground to a halt, as workers agitated to set up a union independent of the Maruti Udyog Kamdar Union that represented workers at the company’s plant at Gurgaon. The strikes and lockouts eventually dragged on till the fall, and cost the company approximately $500 million in lost production.

On Wednesday, nine months after the company finally agreed to recognise the Maruti Suzuki Workers’ Union, a violent confrontation between union representatives and the management, over suspension of a line worker, resulted in the death of a general manager, injuries to 100 managers and arson.

“We never expected this kind of occurrence,” said Shinzo Nakanishi, Managing Director of Maruti Suzuki India Ltd, adding, “I am so shocked.”

“We will de-recognise this union completely,” said S.Y. Siddiqui, Maruti’s Chief Operating Officer, in an interview on Friday. “There will be no compromise on violence.” Yet, the dissolution of the union is unlikely to solve the company’s problems.

If last summer’s agitation hinged on the need for a union to fight for better working conditions, this year, the conflict appears to be a rising frustration that the union, created at great personal cost to the workers, was failing to deliver.

Seen from the plate glass windows of the conference rooms on Maruti’s 600-acre campus at Manesar, the shop floor seems to be a serene union of men and machines. Car doors descend from conveyor belts located high up on the ceiling; engines rise up from the floor to be bolted on to elevated chassis. Yet, when this correspondent visited the plant last year, workers warned that the serenity could often prove false.

“The union was completely frustrated in its interactions with the management, which they felt wasn’t budging an inch,” said a labour activist, who was in close contact with union officers, and offered the example of the prolonged negotiations on a three-year pay settlement. Union representatives have refused to take calls after Wednesday’s incident.

While Mr. Siddiqui said pay negotiations were progressing smoothly, an April 23 report in the Mint newspaper noted that the union had asked the company to double salaries, improve health benefits, transport facilities and incentives. “While the workers were asking for a raise of between Rs. 10,000 and 15,000, our opening offer was Rs. 10,500 for three years,” said Mr. Siddiqui, adding that figures were far from finalized.

An intermediary said that on Monday, July 16, workers were under the impression that Rs. 10,500 was actually the final settled increase staggered out in instalments of Rs. 6,000 in the first year, and Rs. 2,500 and Rs. 2,000 in subsequent years. Workers responded by boycotting the 20-minute morning meetings, said the source.

Mr. Siddiqui confirmed that workers had stopped attending morning exercise meetings from Monday onwards, suggesting that trouble had been brewing before Wednesday’s outburst, but Maruti’s Managing Director, Mr. Nakanishi insisted there was no link between the pay-settlement and Wednesday’s violence.

“No plant is peaceful”

Union leaders elsewhere in Gurgaon say that the violence in Maruti is symptomatic of industry-wide unrest. “Today, it isn’t as if every plant in Gurgaon is violent, but no plant is totally peaceful,” said Raj Kumar, president of the Autoworkers Union at Rico Auto Industries. “The problem is that the management is unwilling to listen to workers. Today, there are no negotiations… There are only fights.”

Maruti representatives, however, have noted that pay settlements with unions in their plants in Gurgaon and at Suzuki Powertrain Ltd have been largely peaceful.

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