Labour pangs for Corporate India

Labour trouble is slowly making a comeback in Indian companies. FMCG major Hindustan Unilever locked out its Doom Dooma unit in Assam after a series of flash strike by its workers even as public sector telecom major Bharat Sanchar Nigam (BSNL) has been slapped a strike threat by its 30,000-odd employees. Official data present a rosy picture on the industrial disputes front but that's more because they are outdated. The Economic Survey says that the number of strikes and lockouts have dropped to 456 in 2005 from 771 in 2000.

"In the past one year, almost all top companies - from the Tatas to the Mukesh Ambani-owned IPCL - have faced labour strikes, resulting in production losses and revenues," said an analyst. Last year, Hindustan Unilever (HUL) had to close down its soap-making factory in Mumbai after the unit became unviable due to higher labour costs and local taxes. Though HUL had offered transfer to its employees to outside Mumbai, the unions resisted the move, leading to the closure of the plant. In July last year, the lockout at Hero Honda's plant and violence made national news. Similarly, the closure of Hindustan Motors' Uttarpara plant in February this year disrupted the supply chain of even Tata Motors, which was sourcing its engines from the company. In September last year, Kannan Devan Hill Plantations in Kerala had to declare a lockout in six divisions of its three tea estates because of a go-slow agitation by a section of the workers.

This was in spite of the workers holding 70 per cent of equity in the company after the Tatas exited from the tea plantation sector. The Tata group still has a minority stake of around 19 per cent in the company and sold out the company to workers' cooperatives due to continuous labour troubles.

The Allahabad unit of Mukesh Ambani-owned IPCL was under lockout for 67 days from February 4 this year due to labour unrest, the company said, while announcing that it retrenched 2,600 employees in the financial year ended March 2007.