Auto firms seek labour law reforms as strike frequency rises

With growing incidences of worker strikes in the Indian automobile industry, major manufacturers have called for labour law reforms, while trade unions said existing rules must be implemented strictly to avoid confrontations.

Close on the heels of a 13-day-long strike at Maruti Suzuki India's Manesar plant, MRF's Kottayam plant in Kerala was also locked out following stir by workers, thus raising questions over labour laws in India.

"The rigidity in labour laws has led companies to increasingly resort to outsourcing and contracting of labour ... To be very precise, the need of the hour is flexible labour reforms," General Motors India (GMI) Vice President P Balendran said.

The contract system gives companies greater autonomy in choosing when to lay off workers in time of a slump, he added.

Balendran said existence of more than one union create confusion and problems and "in many cases, the unions are politically affiliated and follow the party ideology".

Expressing similar sentiments, the country's second largest car maker Hyundai Motors India Ltd's Senior Vice-President (Finance and Corporate Affairs) R Sethuraman said: "The labour laws of the land are not problematic but reforms are always welcome in every sector of the economy."

He said when politically affiliated unions take centre stage, the negotiations practically are never conducted with "ones' own workforce".

"This is not healthy because managements are forced to negotiate with a bunch of people, who for political reasons invariably create an atmosphere of distrust and fear in the minds of the workforce. This is not good for the organisation or the workers.

"Additionally, just as trade unionism is allowed under Indian labour laws, companies have also been bestowed rights under Indian law, wherein they can decide on whom they decide to talk to or negotiate with," Sethuraman said.

However, national trade union leaders have an opposite view to the problem and insist that formation of a union, or even multiple unions, and getting political affiliations are workers' rights and are allowed under the Indian labour laws.

"Most of the auto companies do not respect the Indian labour laws and formation of unions, which is workers' constitutional right. Our machineries to enforce labour laws are very week and there is a need to tighten it," All India Trade Union Congress Secretary DL Sachdev said.

There is no need to reform the laws and its up to the management to decide with which union it wants to negotiate in the presence of multiple unions, he added.