Maruti suzuki’s prolonged labour pain!


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Legal and regulatory aspects of the strikes at Maruti's manesar plant

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Maruti suzuki’s prolonged labour pain!

  1. 1. MARUTI SUZUKI’SPROLONGED LABOUR PAIN ! -By Meghana Bhogle Snehal Kadam
  2. 2. MARUTI SUZUKI’S MANESAR PLANTInaugurated in February 2007Workers from Jeend and Jhajjar regions ofHaryana• Regular : 950• Trainees : 400• Contract workers : 700• Apprentices : 400
  3. 3. FLASHBACK2008 : Slowdown in Car salesMaruti reduces investment in mfg. capacity2010 : Maruti experiences a spurt in demandManesar plant starts producing 350,000cars/yearWorker incentives are aligned to production toensure worker buy-in
  4. 4. JUNE 4, 2011 Production stops at Manesar plantReason : Workers demand formation of a new independent union (MSEU) for Manesar facility
  5. 5. AUGUST 29,2011 50% production cut at Manesar facility Reason : Workers refuse to sign a ‘Good conduct’ bond
  6. 6. SEPTEMBER 15, 2011 2 day full closure of Suzuki Motors’ Indian operationsReason : To support striking workers of Manesar
  7. 7. OCTOBER 7, 2011Full closure of Suzuki Motors’ Indian operationsReason : Demand for restoration of jobs of 1200 contract workers at Manesar
  8. 8. SPI JOINS IN•The strike at Suzuki Powertrain dealt a blow to Suzukis operations in India•Within days, the disruption in the supply chain started choking production at the Gurgaon plant•Complete halt in production of models like Swift and DZire
  9. 9. Haryana government declares the strike as ILLEGAL !
  11. 11. INDUSTRIAL DISPUTES ACT, 1947To secure industrial peace and harmony by providing machinery & procedure forinvestigation and settlement of disputes by negotiation
  12. 12. UNFAIR LABOUR PRACTICES Chapter V-CNo employer or workman or a trade union,whether registered under the Trade Unions Act, 1926 or not, shall commit any unfair labour practice
  13. 13. UNFAIR LABOUR PRACTICES •Interfering in TU activities •Acts of force & violence
  14. 14. PROHIBITION OF STRIKES Chapter V (Section 22) No person employed in a public utility shall go on a strike (a) without giving to the employer notice of strike, as herein-after provided, within six weeks before striking; or(b) within fourteen days of giving such notice
  15. 15. BREACH OF SETTLEMENT Chapter VI (Section 29) Any person who commits a breach of settlement shall be punishable withimprisonment, fine or both and the court may direct the fine to the person who has been injured by the breach
  16. 16. TRADE UNIONS ACT, 1926 Registration, rights, liabilities andresponsibilities of Trade unions & ensures proper utilisation of fundsGives legal status to registered Trade unions
  17. 17. CORE LABOUR STANDARDS? Freedom of association and right to collective bargaining
  18. 18. PROPORTION OF OFFICE- BEARERS Chapter III (Section 22) Not less than one-half of the total number ofevery registered Trade Union shall be persons actually engaged in the industry with which the Trade Union is connected
  19. 19. MARUTI FILES A CIVIL WRIT PETITIONThe Company filed a civil writ petition seekingand obtaining a direction from the Punjab andHaryana High Court, requiring the workers to observe their strike at least 100 metres away from the facility premises of the plant and torefrain from disruption of the plant’s operation
  20. 20. OCTOBER 21, 2011 End of strikes •A tripartite agreement•Grievance Redressal Committee •Labour Welfare Committee
  21. 21. NOVEMBER 4, 2011 TU leaders, Sonu Gujjar & Shiv Kumar, quit with Rs 40 lakh payout 28 others leave with Rs.16 lakh
  22. 22. MARUTI’S LOSSES•June strike costed almost $95 million•August strike costed around $135 million•While the government is estimated to havelost around Rs.350 crore in excise revenue, thecompany itself has lost over Rs.1,500 crore inproduction•The share price of the company fell nearly18% since June
  23. 23. MARUTI’S LOSSES•Total production loss over 51000 units•Rs 1600 crore in lost revenues
  24. 24. THANK YOU