The Empty Promise of Freedom of Association: A Study of Anti‐Union Practices in Haryana

The Empty Promise of Freedom of Association: A Study of Anti‐Union Practices in Haryana
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TABLE OF CONTENTS
INTRODUCTION 7
OBJECTIVES AND METHODOLOGY 10
HISTORY OF UNIONS IN HARYANA 12
Increased Labour Disputes Over Unionization
Viva Global: A Case Study of Extreme Actions to Break Unions
Increased Workers Participation in Labour Disputes
APPLICABLE LAWS WHICH PROTECT
FREEDOM OF ASSOCIATION 19
International Labour Laws
The Universal Declaration of Human Rights (UDHR)
International Covenant on Economic, Social and Cultural Rights (ICESCR)
International Covenant on Civil and Political Rights (ICCPR)
INDIAN CONSTITUTION 22
NATIONAL LABOUR LAWS 24
The Trade Unions Act of 1926
Industrial Disputes Act, Schedule V, Unfair Labour Practices
DYNAMICS OF MIGRANT LABOUR IN HARYANA 28
The Emergence of Migrant Labor in Gurgaon and Manesar

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Why Migrant Workers are easily Exploited
SPECIFIC LABOUR VIOLATIONS UNIONS
FIGHT AGAINST 31
Minimum Wage Violations and Forced Overtime
Wage Theft
Illegal Termination of Workers
Harassment and Physical Violence
THE ROLE OF CONTRACT LABOUR IN
PREVENTING UNIONS 42
The Rising Numbers of Contract Workers in Haryana
Employer Advantages in Using Contract Workers
How Employing Contract Workers Undermines Unionization Efforts
MANAGEMENT PRACTICES TO PREVENT
UNION FORMATION 52
Suppression of Union Activity within the Work Place
Employer Strategies to Prevent Unionization
Sham Unions Created by Management
GOVERNMENT ACTIONS WHICH LIMIT
FREEDOM OF ASSOCIATION 60
Government Failure to Register Trade Unions
Registration Battle for Garment Allied Workers’ Union
Abuse of Court Processes after Unions are Registered
Collusion with Police to Suppress Unions

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Failure of the Court Systems to Promote Justice
DIFFERENCES IN UNIONS IN THE GARMENT
AND AUTO INDUSTRY 72
Outcome of the Maruti Suzuki Strike
Recognition Battle for Modelama Workers’ Union
RECOMMENDATIONS 77
CONCLUSION 78

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ACKNOWLEDGEMENT
This report is the result of an internship partnership between Boyd
School of Law, Las Vegas, Nevada in the USA and the Society for
Labour and Development in India. The main researcher and author
of the report is David Hales, a law student from Boyd.
The research for this project was carried out by students from
various law schools and students from the International Relations
program at Jawaharlal Nehru University. All field research was
conducted with the assistance of field workers from the Society for
Labour and Development. The Boyd School of Law, in Las Vegas,
Nevada, also provided support and assistance in creating this report.
We extend our deepest gratitude to all those who contributed to this
report and most importantly to the workers who face the brunt of
these issues in Gurgaon every day.

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INTRODUCTION
urgaon was supposed to be the model city that would emerge
on the outskirts of Delhi to provide all of India with an
example of what the future of business and development in
India should look like. The rapid growth and development
of Gurgaon was initially praised and applauded as it seemed that
Gurgaon was creating jobs, developing industry, and attracting
significant foreign business investment from major companies like
Citibank, Motorola, IBM, Oberoi, Trident and Westin.1 However, the
rapid rise and development of Gurgaon also created issues including
inadequate sanitation services, lack of adequate water supply, and a
lack of oversight to protect the interests of the poor migrant workers
who were lured to Gurgaon by promises of jobs and economic
opportunity. The development of the city has been described as “a
private sector gone berserk because it was blindsided by greed,
successive governments that abdicated responsibility, and apathy on
part of the landed gentry2.” Due to the fact that the development of
Gurgaon was largely left to the industrialists and private
corporations, there has been minimal oversight or regulation of
business and manufacturing practices. In fact, the All India Trade
Union Congress claims that the significant foreign industrial
investment was the result of an implicit agreement between investors
and the government of Haryana that union activity would be
suppressed.3 This has led to an environment in which human rights
violations are rampant and the government is complicit in allowing
business and manufacturing to continue abusing workers. Despite
corporate greed and the lack of appropriate government regulation
of the city, many migrant laborers, who are no longer able to earn a

1
http://www.hindustantimes.com/gurgaon/how-gurgaon-s-growth-story-turned-
sour/article1-955404.aspx
2
http://forbesindia.com/article/real-issue/gurgaon-how-not-to-build-a-city/33444/1
3
http://forbesindia.com/article/special/haryana-the-state-of-discontent/26432/0
G

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living farming in rural areas, came to Gurgaon in record numbers
looking for work in the booming manufacturing sectors.
The Industries and Commerce Department of the Government of
Haryana described the rapid economic growth in Haryana and
Gurgaon in 2011 as follows4:
“With a splendid economic growth, one of the highest per
capita income index, sound industrial infrastructure, strong
manufacturing base, advanced agriculture sector and vibrant
service sector, Haryana is among the highly economically
developed and industrialized States of India. The State has its
manufacturing stronghold particularly in sectors like
automobile & auto components, light engineering goods, IT &
ITES, textile & apparels and electrical & electronic goods.”
The growth of these manufacturing industries in Haryana and
Gurgaon is only possible due to the massive populations of migrant
workers hoping to find a better life and economic security in
Gurgaon, India’s model modern city. Unfortunately, upon arriving
in Gurgaon, migrant laborers are faced with inhuman working
conditions, terrible living conditions, and a work environment in
which human rights violations are rampant while compensation is
minimal. Many of these workers are barely able to survive and have
no way to return to their villages, as they have spent all of their
savings and often times taken on extreme debts to come to Gurgaon
and look for work. Given the huge population of migrant workers
who are easy to exploit, it is critical that such workers are able to
unionize to effectively advocate for their rights. Unfortunately, the
impressive mega shopping malls and modern office building
complexes distract attention away from the enormous population of
poor migrant workers whose exploitation fuels the rapid industrial
growth in Gurgaon and their struggles to unionize and fight for a

4
http://hsiidc.org/eDocuments/IP2011.pdf

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decent work environment and livable wages. The struggle and fight
for workers’ rights including freedom of association and the right to
form unions is of critical importance at this time, as emerging
industrial norms in Haryana will like remain in place and be
followed by other industries across India. As such, it is essential that
the fight for unions is fought and won in Haryana so that workers
can collectively bargain to protect their rights and work with dignity
and earn a livable wage.

OBJECTIVES AND METHODOLOGY
he research in this report was compiled by the Society for
Labour and Development, based in New Delhi. The research
for this project was carried out by students from various law
schools and students from the International Relations program at
Jawaharlal Nehru University. All field research was conducted with
the assistance of field workers from the Society for Labour and
Development. The Boyd School of Law, in Las Vegas, Nevada, also
provided support and assistance in creating this report.
Field research was carried out through interviews with government
officials, workers, union representatives, and legal advocates.
Specifically, Ramesh Kumar Ahuja, Assistant Labour Commissioner
of Circle 4, Gurgaon, Haryana, was interviewed regarding opposition
to union activity, the conciliation and court case process, and
contract labour issues. Retu Singh, the union representative for the
Garment Allied Workers Union (GAWU) was interviewed regarding
labour violations at Modelama, issues registering unions, and
management practices to limit unionization. Additionally, Parimal
Sudhakar, an activist for the rights of migrant workers, was
interviewed regarding abuse of migrant workers, obstacles to union
registration and issues with the government offices responsible for
union registration. Rakhi Sehgal, Vice President of the Hero Honda
Ltd. Union, was also interviewed regarding union issues in the auto
industry. Similarly, G K Walia, a former union representative for the
Maruti Union and worker at the Maruti manufacturing facilities,
provided insight into how the companies dismantle existing unions
and abuse workers. Ashim Roy, a leader with the New Trade Union
Initiative, was also interviewed regarding labor violations at the
macro level and the spoke on the importance of unions as it relates to
fundamental human rights. Jalal Uddin Ansari, from the Society for
Labour and Development, provided information regarding labour
rights violations in various companies that manufacture garments.
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Monu Kuhad, an attorney who successfully fought for and registered
a trade union, was interviewed regarding his legal struggles and
battle to successfully register a trade union. Gunjan Singh, a lawyer
engaged in litigation of cases and the conciliation process highlighted
issues faced by workers who bring cases in the legal system, barriers
to litigating cases within the legal system, and tactics companies use
to evade legal liability for their actions. Lastly, countless workers
from the auto and garment industries were interviewed regarding
human rights violations, workplace conditions, and the struggles to
form unions and collectively bargain with management.
The objective of this report is to document the obstacles that workers
face as they attempt to organise and form unions. This report also
seeks to expose how dysfunctional government offices and practices
prevent union registration. Additionally, this report is provided with
the hope that through exposure of such anti-union practices in
Haryana, policies and procedures will be changed to allow workers to
form unions that are effectively registered by the government and
recognized by employers. Lastly, this report provides
recommendations that will allow workers to effectively organize and
register unions.
***

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HISTORY OF UNIONS IN HARYANA
Increased Labour Disputes over Unionization
In recent years organized labor disputes and worker led protests
against the inhuman working conditions at factories in Gurgaon and
Manesar have been steadily increasing, and in many cases the
primary objective of such protests is to ensure that workers have the
right to form a union. Labor protests are
increasing in frequency and regularity in
the Gurgaon to Manesar industrial belt,
with up to 60-70 organized labor
disputes, strikes, and peaceful protests a
month.5 In many of these protests the
issue of collective bargaining and right of
workers to form a union is the source of
such collective protest. J. John, executive
director of Centre for Education and
Communication and editor of Labour File
a bimonthly journal on worker issues,
explained that “in many cases, there is no
demand for even a wage rise; just to form
a union” and he clarified that much of the
industrial strife is the result of companies
suppressing workers’ constitutional right
to freedom of association and collective
bargaining. Satbir Singh, leader of Centre
for Indian Trade Unions, explained that
of the 10,000 manufacturing companies in Haryana's industrial belt,
which includes Gurgaon and Manesar, only 100 allowed trade unions
and freely let workers collectively bargain with management. At all
other factories workers must fight for their right to collectively

5
http://kafila.org/2014/12/03/days-and-nights-in-manesar-reflecting-on-the-asti-workers-
struggle-anshita-arya/
much of the
industrial
strife is the
result of
companies
suppressing
workers’
constitutional
right to
freedom of
association
and collective
bargaining

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bargain with management and fight to form and register trade
unions.
There are numerous examples of significant industrial disputes that
are directly attributable to companies denying the workers the right
to organize unions and collectively bargain with management. From
April to November 2009, there were four labor disputes that arose
specifically because workers were denied the right to form and
register unions. For example, in April 2009, Musashi Auto Parts
management suspended several leaders fighting for union
recognition and collective bargaining, and in response 250 workers
showed support for the union during a peaceful protest march where
they were attacked and arrested by the police. Another example of
worker protests over the right to from unions occurred in September
2009, when workers at Rico Auto Limited demanded a recognized
and registered trade union, which prompted massive terminations
and suspensions of workers, and led to 5,000 workers protesting
outside of the factory gates. Similarly, at Graziano Trasmissioni
India, a long dispute about union recognition, which was backed by
the support of several trade unions in the industry, led to suspension
and lock out of workers which prompted labour protests which
escalated and eventually caused the death of a manager. During an
interview, Ramesh Kumar Ahuja, Assistant Labour Commissioner of
Circle 4, Gurgaon, Haryana, explained that such incidents are not
unusual due to the fact that companies will take any action required
and take extreme measures to fight against unionization, especially
during the earliest stages of unionization.

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Viva Global: A Case Study of Extreme Actions to Break
Unions
A labour dispute at Viva Global, a major supplier of manufactured
garments for export with clients including Marks & Spencer,
illustrates the extreme actions that employers are willing to take to
ensure that unionization does not take place. Due to worker
attempts to form a union at Viva Global with the help of GAWU,
management illegally locked out 102 workers associated with union
organization activities on 23rd August 2010. Then workers
approached Labor department on the same day protesting such
illegal lock out, there before the Conciliation officer it was mutually
agreed that all the workers would be reinstated unconditionally
and can resume their duty from 25th Aug (as 24th August was a
holiday). When on 25th Aug workers went to the company, they
were assaulted by the hired goons and a worker named Anwar
Ansari was kidnapped. GAWU president Anannya Bhattacharjee
along with other union members sat on a hunger strike demanding
strict action against such illegal practices of the management and
early recovery of the kidnapped worker. It was only after 14 hours
of hunger strike that the kidnapped worker was found. The protest
continued against the illegal lockout for several days before the
company gate with workers demanding reinstatement into the
work. In the meanwhile GAWU sent representation to various
officials of Labor department including Deputy Labor

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from 1991 to
2010 the
number of
registered
factories
doubled from
5,652 to
10,474 and at
the same time
only 400 new
trade unions
were
registered
Commissioner, but no concrete action was taken, thus workers
were forced to approach High court on 20th Sep 2010.
The illegal lock out caused the workers to organize a peaceful
protest outside of the factory gates.
During the protest Viva Global hired
goons to attack and beat the protesting
workers with clubs, canes, and sticks.
During the attack women were also
targeted having their clothes torn off and
being physically assaulted. During the
attack Anwar Ansari was abducted and
held for 14 hours, he was blindfolded,
tied to a chair, and violently beaten. He
was later released after his life was
threatened, and he was told if he was not
on a train to Bihar the next day he would
be killed and have his limbs torn off. A
police report was filed, and following the
kidnapping Viva Global offered a
settlement to Mr. Ansari for the
traumatic nature of the events and his
injuries. This labor dispute attracted
significant media attention and caused
Marks & Spencer to cancel all production
contracts with Viva Global, although publicly Marks & Spencer
claims the labor dispute had nothing to do with termination of the
contracts. Following the labour unrest, numerous employees
involved in unionization efforts were illegally terminated, in
violations of Schedule V of the Industrial Disputes Act.
Legal cases were filed in Labour Court on behalf of the workers and
42 of them were reinstated, but such reinstatement was done only
after GAWU filed a Writ Petition in the High Court of Punjab and

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Haryana. In this Writ Petition, the inaction on the part of Labor
Department and Labor Court (Industrial Tribunal) was highlighted,
which the High Court considered, and ordered the matter to be
settled in a time bound manner. After these workers were reinstated,
they were again terminated from the services of the company in
contravention of the settlement done at the directions of High Court.
Failure by the employer to live up to the settlement agreement is
illegal and an unfair labour practice under Schedule V of the
Industrial Disputes Act. Consequently, the workers filed another
Writ Petition in High Court of Punjab and Haryana against the illegal
lockout by the company. In the meanwhile company closed down
and the case is presently pending before the High Court.
While the cases were pending and workers were reinstated, the
union workers were subjected to harassment, physical violence, and
intimidation at the hands of the company. In one incident the
factory gates were locked and a manager gave a female guard a knife
and stick which she used to threaten people and beat workers, who
could not leave the factory. When the workers went to file a police
report they discovered that Viva Global management filed a police
report three hours before the incident claiming that employees had
assaulted a female security guard. Following this incident the
workers were continually harassed and beaten by guards upon their
return, and female employees were denied use of the bathroom and
there was one incident where a man spied on women in the toilet
with an intention to scare them and threaten rape and sexual assault.
The labor dispute at Viva Global illustrates the extreme lengths to
which companies will go to ensure that workers are afraid to be
involved in unions and collective labor disputes, and all practices by
the company are unfair labour practices under Schedule V of the
Industrial Disputes Act.
Such tactics have clearly been effective in undermining unionization
efforts, as when the rate of unionization that has occurred in
Harayana is compared to the growth of manufacturing facilities,

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there is a clear disparity. For example, according to the State Labour
Department, from 1991 to 2010 the number of registered factories
doubled from 5,652 to 10,474 and at the same time only 400 new
trade unions were registered, with a total of 1,540 trade unions
registered in Harayana in 2010. At the same time, industrial
factories have been growing at an extremely fast pace and union
registration has stagnated, which has led to a sharp increase in major
collective industrial disputes and worker protests. As free market
economics became liberalized in Harayana and worker abuses
became more rampant, in 2008 the number of industrial unrest
incidents began to surge with increased numbers of disputes and the
highest levels of worker participation in such disputes. For example,
according to the Labor Bureau, in 2007 there were 389 major
industrial disputes which involved 724,574 workers but by 2008
there were 421 major industrial disputes which involved 1,579,298
workers. The message to management was clear; workers were
willing to show solidarity in protesting the work conditions in
factories.
Increased Worker Participation in Labour Disputes
From 2007 to 2008 the number of incidents increased significantly,
but more importantly, the number of workers participating in the
protests doubled, and in many instances contract workers joined
permanent workers in the protests. For example, in the major
Maruti Suzuki strike in 2011, an overwhelming majority of
permanent employees joined the strike, but more importantly
around 1,200 of the 2,400 contracted employees also joined the
strike. Emboldened by the solidarity of the workers in the Maruti
Suzuki strike, many other auto manufacturing workers decided to
take collective action in their own factories and protest working
conditions. Such figures show that as of 2008, workers began to
become increasingly involved in joining collective protests, and
showed strong solidarity and support in collectively pressuring
employers to change working conditions. With such increased

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worker participation in labour disputes, it is no surprise that in 2008
almost one third of all labour disputes were primarily about the right
to form unions or have unions recognized by management.
Additionally, such official statistics from the Labour Bureau do not
account for labour disputes where unionization was a secondary
issue, yet still important to workers. Clearly, working conditions in
Haryana have gotten so terrible that workers are ready to unite,
collectively protest, and join unions to eliminate labour violations
and inhumane management practices. Right now, the industrial belt
from Manesar to Gurgaon is ready and willing to take up the fight for
unionization and freedom of association.
***

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APPLICABLE LAWS WHICH PROTECT
FREEDOM OF ASSOCIATION
INTERNATIONAL LABOUR LAWS
These international human rights declarations are intended to
provide a minimal level of protection for all citizens to ensure that
they can live in decency and with dignity. These protections are
intended to be standard and universal human rights which all human
beings are endowed with. It important to acknowledge that these
universal human rights frameworks seek to establish only a
minimum level of human rights which no country should be able to
take from their citizens, however, it is recommended that all
countries adopt these standards in addition to other laws and
procedural safeguards to ensure these rights are protected and not
violated. Other international human rights frameworks similarly
seek to establish and protect the most basic and fundamental of
human rights which are necessary for people to live in dignity and
free from oppression. It is worth noting that in all of the various
international human rights frameworks the right to form unions and
associations is recognized as an essential element of a functioning
society.
The Universal Declaration of Human Rights (UDHR)
The United Nations is an international organization comprising 52
member-states, which promotes human rights, among other
objectives. In 1948, the UN adopted the Universal Declaration of
Human Rights (UDHR) into the UN charter, which is binding on all
member states, including India. The UDHR outlines inherent
fundamental human rights for the international community. India, a
UN member state, is obligated to adhere to the UDHR. The UDHR
provisions that address this report’s issues are:

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Article 20: Everyone has the freedom to peaceful assembly
and association…No one may be compelled to belong to an
association.
Article 23: Everyone has the right to work…Everyone has the
right to equal pay for equal work…Everyone has the right to
human dignity…Everyone has the right to form and join trade
unions.
Article 24: Everyone has the right to reasonable working
hours, holidays with pay.
Article 25: Everyone has the right to a standard of living
adequate for the health and well-being of himself and of his
family, including food, clothing, and housing and medical care
and necessary social services, and the right to security if
unemployment occurs, sickness, disability, widowhood, old
age or other lack of livelihood in circumstances beyond his
control.
International Covenant on Economic, Social and Cultural
Rights (ICESCR)
The UN created the International Covenant on Economic, Social, and
Cultural Rights treaty (ICESCR). The ICESCR provisions ensure that
fundamental human rights are secured, such as labour rights. In
1979, India ratified the ICESCR, which obligates India to adhere to
the ICESCR. The ICESCR provisions relevant to attacks on the
freedom of association include:
Article 6: right to [decent] work, which includes the right of
everyone to the opportunity to gain his living by work which
he freely chooses or accepts, and will...safeguard this right…
Article 7: right of everyone to the enjoyment of just and
favorable conditions of work, with livable wages, equal pay for

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equal work, equal promotional opportunities solely based on
seniority and competence...Rest, leisure and reasonable
limitation of working hours and periodic holidays with pay,
and paid public holidays
Article 8: The right of everyone to form trade union, join the
trade union of his choice, and the right to strike
International Covenant on Civil and Political Rights
(ICCPR)
International Covenant on Civil and Political Rights (ICCPR) uses
civil, social, cultural, and political assurances to achieve the goals of
the UDHR. In 1979, India ratified the ICCPR, which obligates India
to adhere to the ICCPR. The ICCPR provisions relevant to attacks on
freedom of association include:
Article 14: Everyone has a right to access the justice system.
Article 16: Everyone has the right to be recognized as a person
before the law.
Article 22: Everyone shall have the right to freedom of
association with others, including the right to form and join
trade unions for the protection of his interests. No
restrictions may be placed on the exercise of this right.
***

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INDIAN CONSTITUTION
he Indian Constitution provides the Indian government a
framework to create laws. The Constitution has divided the
legislative branch into three sections, or lists: Union List,
State List, and Concurrent List. Each of these lists contain subjects
that grant the central government, state government, or both the
central and state governments the power to make laws regarding that
subject. Labour is on the Concurrent List which gives the state and
the central government the power to create laws regarding this topic.
Additionally, the Indian Constitution is the highest legal authority in
India; however, a portion of the Constitution has no legal effect: the
state directive principles. However, if the state enacts the directive
principle, the law takes effect. Because Haryana has enacted the
following Constitutional provisions, they are legally enforceable.
Article 14: Promise to treat all citizens equally under the law.
Article 16: Equal opportunities for employment for all
citizens.
Article 19: Everyone has an enforceable right to freedom of
speech and expression, peaceful assembly, and the right to
form associations or unions.
It is critical that the right to freedom of association, and right to
assemble are provisions that fall under the fundamental rights
provisions of the Indian constitution. As such, these rights are
considered amongst the most basic and essential of human rights
necessary to ensure human dignity and a properly functioning
democracy in India. The constitution of India specifically provides
that it is necessary and essential that citizens have the right to
assemble and join unions or form associations. It is worth noting
that such rights can only be infringed “in the interests of the
sovereignty and integrity of India or public order or morality” and
T

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any restrictions for such purposes must be reasonable.6 Given that
the right to form unions and associations is one of the fundamental
rights guaranteed by the Indian Constitution, it is clear that such
rights are fundamental and amongst the most important of
democratic ideals necessary for the freedom and improvement of all
of Indian society.
***

6
See Indian Constitution Article 19, Section 4.

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NATIONAL LABOUR LAWS
The Trade Unions Act of 1926
The Government of India has passed The Trade Unions Act of 1926
which specifically provides for the right of unions to be registered
and outlines procedures for registering trade unions. Under the Act,
any seven or more members of a trade union may submit an
application for registration of their trade union by signing their
names and submitting the formal application to the appropriate
government offices. To register a trade union any worker wishing to
submit their name in support of the application must submit their
name, occupation, and signature on the application. Additionally an
application to register a union is not invalid merely because an
individual who subscribed their name to the application has left the
union. The act specifically provides that:
Where an application has been made under sub-section (1) for
the registration of a Trade Union, such application shall not
be deemed to have become invalid merely by reason of the fact
that, at any time after the date of the application, but before
the registration of the Trade Union, some of the applicants,
but not exceeding half of the total number of persons who
made the application, have ceased to be members of the Trade
Union or have given notice in writing to the Registrar
dissociating themselves from the application.
Lastly, under the 2001 Amendments to the Act, registration and
maintenance of the union requires 10 percent of the workforce or
100 workers, whichever is less, be engaged or employed in the
establishment or industry associated with the union. The 2001
Amendments also require that at least one-half of the office-bearers
within the registered union are persons actually engaged or
employed in the establishment or industry associated with the union.

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Registration of trade unions is essential because it provides
legitimacy to the unions and under the Trade Unions Act of 1926,
registered unions benefit from special protections under the law.
Specifically, the act generally shields union members and office
bearers from criminal conspiracy charges during labour disputes.7
Additionally, the act provides legal protections including civil
immunity for union office bearers or members and their activities
which are undertaken on behalf of the
union.8Furthermore, under the Industrial
Disputes Act of 1947, during an industrial
dispute an employer is prohibited from
altering the conditions of employment for
the protected workman in any prejudicial
manner and the employer is prohibited
from discharging, punishing, or
suspending the protected workman.
However, such protections extend only to
“protected workmen” who are defined as
members of the executive or other office
bearers of a registered trade union
connected with the establishment, and
only one percent of the members of the
union can be recognized as protected
workmen, with up to a maximum of 100
protected workmen. These are the
minimal legal protections that are offered
to unions upon successful registration,
and it is important to observe that simply because a union is
registered does not mean that the management of a factory must
recognize that union. Similarly, it is possible for management to
recognize a workers union despite the fact that the union is not
registered and does not have the special legal protections afforded to

7
See Trade Unions Act of 1926, Chapter III, Section 17
8
See Trade Unions Act of 1926, Chapter III, Section 18
registration of
trade unions is
essential because
it provides
legitimacy to the
unions and under
the Trade Unions
Act of 1926,
registered unions
benefit from
special protections
under the law

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registered trade unions. Lastly, under Schedule V of the Industrial
Disputes Act, it is an unfair labour practice for employers to refuse to
collectively bargain with registered trade unions that have been
recognized and legitimized by the Indian government. Consequently,
it is best for unions to be both registered, which offers legitimacy and
protections, in addition to recognized by management, which
provides actual and meaningful opportunities for collective
bargaining.
Industrial Disputes Act, Schedule V, Unfair Labour
Practices
Under Schedule V of the Industrial Disputes Act, unfair labour
practices are defined and employers are prohibited from engaging in
such abusive labour practices against unions and union employees.
Specifically, under Schedule V, it is illegal for employers “To interfere
with, restrain from, or coerce, workmen in the exercise of, their right
to organise, form, join or assist a trade union or to engage in
concerted activities for the purposes of collective bargaining.”
Schedule V of the Act defines unfair labour practices as any acts by
employers such as threatening workers with termination if they join
unions, threatening lock-outs if unions are formed, or granting a pay
increase to workers to undermine unionization efforts. Additionally,
employers are prohibited from discouraging workers from forming
or joining trade unions by discharging or punishing workers who
advocate for or help form unions, discharging or dismissing workers
for taking part in labour protests including strikes, changing
seniority of workers for joining unions, refusing to promote union
workers, or discharging union office members. Schedule V of the
Industrial Disputes Act also strictly prohibits discharging workers
under false pretenses or in bad faith, including wrongfully
implicating workers in criminal cases. Furthermore, under Schedule
V, employers are prohibited from using contract labour to
undermine permanent employee job security or labour unrest. In
addition, the following acts are defined as unfair labour practices:

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transferring workers as punishment, depriving workers of the
benefits of permanent employment, and engaging in acts of violence
or force against union members. Lastly, employers are prohibited
from refusing to collectively bargain with recognized trade unions,
and they must abide by and implement any settlements and
agreements that are the product of collective bargaining. The unfair
labour practices specifically identified and outlined in Schedule V of
the Industrial Disputes Act are intended to protect unions and union
employees from abuse and retaliation at the hands of employers.
***

Page28
DYNAMICS OF MIGRANT LABOUR IN
HARYANA
The Emergence of Migrant Labor in Gurgaon and Manesar
The emergent economic growth in the industrial and manufacturing
sectors of Gurgaon and Manesar has only been made possible due to
the huge numbers of easily exploitable migrant workers that come
from across India. In 2010 to 2011 the per capita GDP of Haryana
was Rs 59,188 which is significantly higher than the most other
states in India. In contrast, during the same fiscal year Bihar had the
lowest per capita GDP of Rs 13,303 and Uttar Pradesh had the
second lowest per capita GDP of Rs 17,418. Such a huge disparity in
economic opportunity has fueled massive migration from those
regions into Gurgaon and Manesar. Many of the migrant workers
formerly worked in agriculture in rural villages, have minimal
literacy, and have no social supports upon moving to the industrial
belts. Additionally, with such huge numbers of migrant workers
willing to work for less than minimum wages and accept substandard
working conditions, manufacturing facilities have been guaranteed a
steady supply of cheap and easily exploitable workers. The huge
growth in manufacturing profits has been largely fueled by the cheap
and easily exploitable migrant workers who have no choice but to
accept whatever working conditions and wages an employer will
provide.
Why Migrant Workers are Easily Exploited
Lured to Gurgaon by promises that it is the new modern industrial
city in India with good paying jobs and endless economic
opportunity, many migrant worker have spent all of their savings
and even taken on debt in an effort to migrate to the Haryana
industrial belt. Lured to Gurgaon by promises that it is the new
modern industrial city in India with good paying jobs and endless
economic opportunity, many migrant worker have spent all of their

Page29
savings and even taken on debt in an effort to migrate to the Haryana
industrial belt. The poorest and least skilled of the migrant
workforce find employment in the garment manufacturing sector in
which they produce garments for export being paid wages that are
low enough to compete with wages in other garment producing
countries like Bangladesh and
Vietnam. Those with more skill or
literacy will take jobs in the auto
manufacturing sector in dangerous
factories in which industrial
injuries are common and concern
for the safety of workers is ignored.
Many employment recruiters will
travel to villages and promise good
paying jobs in addition to short
term loans to pay for the cost of
traveling and initial living expense
when the workers get to Gurgaon.
These workers arrive with
significant debt obligations and
find that the promise of higher
wages was not realistic and they are
worse off than when they lived in
their villages, due to the debts they
now must repay. Similarly, labor recruiters and labor contractors
prefer to select migrant workers without local roots or social support
networks to undermine the ability of such employees to participate
in labor disputes. Interviews with workers revealed that many
migrants find themselves in exploitive housing contracts paying
extremely high rates for housing which is unsanitary and lacks
proper access to clean water and electricity. Interviews with workers
also revealed that some workers are forced by the employers to stay
in company housing which also exhibits the same unacceptable living
conditions and comes at an unreasonably high rates. In such
the huge growth in
manufacturing profits
has been largely
fueled by the cheap
and easily exploitable
migrant workers who
have no choice but to
accept whatever
working conditions
and wages an
employer will provide

Page30
company housing communities, provisions and food must be
purchased at unreasonably high prices from company run provision
shops. Due to such tactics by employers, labor recruiters, and
landlords, migrant workers are in an extremely vulnerable position
and barely have enough money to survive, which ensures that they
cannot afford to participate in labour disputes and will accept
whatever wages they are given. The massive growth of the
manufacturing sectors is dependent on this vast pool of cheap
migrant labour to continue to post record growth and profits.
***

Page31
SPECIFIC LABOUR VIOLATIONS UNIONS
FIGHT AGAINST
nions are critical in helping workers to fight against the
rampant labour rights violations that take place every day in
manufacturing facilities across Gurgaon and Manesar.
These violations include wage theft, illegal termination, minimum
wage violations, harassment and physical violence in the workplace,
forced overtime or unfair denial of overtime, and failure to pay into
employee Provident Fund and Employee State Insurance (ESI)
accounts. All of these practices are intended to ensure that workers
are economically vulnerable, fearful of losing their jobs, and have no
means to support themselves in the event that they are terminated.
These practices ensure that workers will not be involved in unions or
try to form unions due to the precarious nature of their employment
and their precarious economic condition. Unionization of such
workforces is critical to ensure that these workers can collectively
bring their grievances to management without fear of losing their
jobs and their economic security. Additionally, companies are
fearful of unionization because they know that if workers unite they
will not be able to exploit the vulnerable workers they rely on to
create such huge profits.
Minimum Wage Violations and Forced Overtime
In many cases, employers violate the Minimum Wages Act by failing
to pay employees the required minimum wage, forcing employees to
work overtime without any compensation, or paying normal wages
for overtime hours worked. At Pearl Global, a major garment
exporter for NEXT and GAP, the company was found on numerous
occasions to be in violation of minimum wage laws and forcing
employees to work excessive overtime without proper compensation.
An investigation by the Asia Floor Wage Alliance, found that many
workers were not being provided the minimum wage as required by
U

Page32
law, and virtually all workers were not adequately compensated for
the forced overtime they are required to work. Segar, a worker at
Pearl Global explained that in one month he was required to work
150 hours of overtime, and he explained, “I like the work but don't
like the excessive overtime. But we are told if you don't want to work
overtime you don't work here." Similar violations exist in the auto
manufacturing industry. At Rico, an auto manufacturing company,
one worker explained that employees are forced to work on their
days off and overtime is compulsory without proper compensation,
and while minimum wage compensation should provide most
workers with at least Rs 5,500 a month, many workers are only paid
Rs 4,200 a month. Similarly, Ashok Kumar Singh, an employee with
Modelama, showed evidence that he was paid Rs 5,097 a month even
after working forced overtime, despite the fact that the legal
minimum rate for his job was Rs 5,300. In addition to failing to pay
minimum wages or overtime, employers also fail to provide
Provident Fund and ESI contributions as required. Cases of
employers failing to pay Provident Fund and ESI contributions have
been documented at Maruti Suzuki, Neolite, Modelama, Viva Global,
and countless other companies. By failing to pay minimum wages
and forcing workers to work outrageous overtime hours without
compensation, employers are able to maximize production while
minimizing costs. Additionally, such practices ensure that workers
will not have enough time or money to be involved in union activities
or labour protests, and failure to pay minimum wage and forced
overtime are a significant source of wage theft that companies
engage in.
Wage Theft
Wage theft is rampant within the manufacturing facilities in Gurgaon
and Manesar due to the fact that many migrant workers are unable
to oppose such actions and have no choice but to accept whatever
payment or compensation employers are willing to provide. Many
employees interviewed reported that employers will delay payment

Page33
of wages until some workers are owed almost an entire month of
back wages and have very little money to survive on. Such practices
place workers in a precarious financial position as they are not being
paid in time to pay off creditors and meet all financial obligations.
Additionally, when a worker is terminated many employers refuse to
pay remaining wages which are due. Workers reported that this type
of wage theft is common and that workers will not get involved in
industrial disputes out of fear they might be terminated without a
full month of wages being paid. One auto worker interviewed
explained that his boss continually paid him only partial wages
promising that balance of wages due
would be paid in full at a later time,
which continued until almost three
months of back wages were owed. When
the worker protested and requested
payment of his wages he was illegally
terminated and received none of the
wages that were owed. Late payment of
wages is a tactic that employers use to
ensure that workers will continue to be
productive and not create problems in
the workplace, as many of the workers
are counting on the payment of the
accumulated back wages they are owed to
survive and fear losing those
accumulated wages if they protest
working conditions and are illegally
terminated. A similar form of wage theft
occurs when employees are terminated
and not paid their bonuses. A female garment worker for Modelama
explained that after three years of working for the company she was
terminated and the company refused to pay her the bonus which she
was entitled to. Numerous interviews with workers in both the
garment and auto industry revealed that similar wage theft also
late payment of
wages is a tactic
that employers
use to ensure that
workers will
continue to be
productive and
not create
problems in the
workplace

Page34
happens when employers falsely claim to have paid into the workers’
Provident Fund or ESI when in reality no such contributions have
been made. These tactics ensure that workers will not bring labour
disputes against the company because they do not have sufficient
funds and will be unable to survive without continued income from
their job. Furthermore, such economically vulnerable employees are
extremely reluctant to be involved in union activity for fear of losing
their job. As one employee explained, “it is only after you have been
fired and they have taken your wages that you will go to the union
and ask for help, because only then you have nothing else to fear the
worst has already happened.”
Wage theft is even more rampant in the case of contract workers.
The use of contract workers has proven to be a lucrative way for
labour contractors to engage in wage theft. Based on required
government documentation forms filed by various labour contractors
in Haryana, the most conservative estimate of wage theft by one
contractor was Rs 8,309,478 based on documents submitted for
wages paid from January 2010 to June 2011. Similarly, the estimated
wage theft by another labour contractor for the same period ranges
from Rs 7,419,482 to Rs 18, 205,807. Based on even the most
conservative estimates for wage theft by labour contractors, the
practices is lucrative and involves substantial sums of money. Such
wage theft is only possible because many migrant and contract
workers do not receive pay slips as is required by law and therefore
have no way to prove that the wage theft has occurred. Retu Singh
explained that the contractors will either keep the wages for
themselves or they will inform the principal employer they have been
able to cut costs of production without explaining how. Such tactics
are used by labour contractors to obtain higher bonuses and
promotions from the principal employer. Unfortunately, contract
workers are reluctant to object to such practices or go to unions for
help because they lack job security and need to continue to make
money to support their families. A contract worker in the auto

Page35
industry in Manesar explained that “contract workers know that the
contractor can just go find ten other workers ready to do your job,
which mean you have to be worried about making sure they want you
to keep working next week.” Due to the situation of contract workers
in Manesar and Gurgaon, they are unable to form unions or oppose
the rampant wage theft that they endure, as the costs are too high
and the employees are barely able to live off the minimal wages they
are actually paid.
Illegal Termination of Workers
Employers, managers, and labour contractors often illegally
terminate workers for the most arbitrary of reason and without just
cause to ensure that other workers remain in a state of fear and
anxiety that they might lose their job if they speak up against labour
rights violations. The illegal termination of such employees is a
direct violation of Schedule V of the Industrial Disputes Act, and
such actions by employers fall under the definition of unfair labour
practices. For example, a migrant contract worker at JNS Auto
Parts explained that at his company the permanent employees tried
to form a union to fight for better wages. In response the
management raised production quotas for the 300 pro-union
employees and terminated them for not meeting the impossible
quotas. When asked about the union employees, the worker
explained that he did not know much about them because he keeps
his distance from them so that he will not lose his job. Raising
quotas to unmanageable levels to fire union employees is also a
common tactic in the garment industry. Lalji Lal, a garment worker
at Maximum Export, explained that when management found out he
was talking with unions they raised his production quotas and
assigned him new garments to manufacture which he was unfamiliar
with. He was eventually terminated due to the fact that he could not
manufacture the new and extremely difficult type of garment they
required that he produce. Such tactics by management ensure that
workers do not become involved in unions and continue to be

Page36
complicit in the face of rampant human rights abuses, as they fear
retaliatory termination for arbitrary reasons if they are involved in
union activities.
Other tactics employers used to arbitrarily terminate employees
include terminating employees using
fraudulent documents and forcing
workers to resign under threat of
physical violence. Often employers will
require that employees sign numerous
blank sheets of paper at the time of
hiring which the employers will then use
to falsify voluntary resignation forms for
employees. For example, a garment
worker at Modelama explained that at
the time of hiring they are forced to sign
the blank sheets of paper, when he
protested signing the forms he was told if
he did not want to sign then he would not
get to work. As the worker explained,
there is a long line of people waiting to
get signed up and hoping to find work,
which means you have no choice but to
sign the forms. Companies also use
misrepresentation to get workers to sign
voluntary resignation forms. Gunjan Singh, a lawyer who litigates
labour dispute cases, explained that after a successful conciliation
agreement while signing the documents he found that the employer
had inserted a voluntary resignation form in with the conciliation
agreement documents hoping the employee would just sign all the
documents in the agreement and not notice the resignation
agreement. Such deceptive and manipulative termination practices
are common place and used to target employees who are found to be
involved with unions.
often employers
will require that
employees sign
numerous blank
sheets of paper at
the time of hiring
which the
employers will
then use to falsify
voluntary
resignation forms
for employees

Page37
When companies are unable to get voluntary resignation forms
through fraud or misrepresentation, the companies simply resort to
threats of physical violence and force employees to sign resignation
documents. For example, Ram Niwas Yadav, a worker and union
representative at Hema Engineering Industries Ltd in Gurgaon, was
surrounded by six men working on behalf of the management and
was beaten and threatened with his life if he did not resign. The
beating was so severe that he ended up having to stay at the hospital
to recover and the workers were so outraged that a large scale labour
protest erupted at the company. Such incidents are very common,
when Alaudin Arjun, a garment tailor at Mehra Bandhu, became
involved in organizing and registering a union, he was threaten by
management and harassed and eventually forced to resign. The
management told him that he had gotten fat and lazy and that thugs
would kill him and “burn his fat” and that women guards would beat
him if he did not resign. Similarly, Hanif Mohammed, employed at
Bajaj Motor Co. Ltd, was beaten and forced to resign from his job
two weeks after he and other workers organized and filed for union
registration. Modelama commonly engages in forced resignation by
asking employees to report to management offices where they will be
locked in a room and surrounded by six or seven men and forced to
sign a resignation letter under the threat of violence. When
Modelama employees tried to register a union, the company used
such forced resignation practices to illegally terminate 11 workers
and transfer 3 employees. Eventually, after an ensuing labour
dispute and conciliation case, the company admitted the resignation
forms were a sham and reinstated the workers. Harassment of
workers or subjecting them to physical violence is strictly prohibited
and is an unfair labour practice in violation of Schedule V of the
Industrial Disputes Act. Such practices ensure that workers are
afraid to advocate for unions or file for union registration knowing
that they risk physical violence and will likely lose their job.

Page38
If employers are unable to force employees to resign through various
deceptive practices, they will terminate employees under false
pretenses and alleged violations of company policies. Muhammad
Shamim, a garment producer for Modelama, explained that he
needed sick leave and followed all protocol including submitting the
documents to his supervisor. When he returned from approved sick
leave he was fired because management claimed he never filled out
the documents and failed to show up to work without an excuse. He
had connections at the establishment and got copies of the sick leave
documents and won his case at conciliation. However, he stated that
most people could not obtain such documents as they do not have
friends at the company willing to risk providing such documentation
to employees. In a similar case, Manoj Kumar, a worker at
Modelama, requested time off to care for his sick wife, and properly
submitted the forms to request such time off with the company.
Leave was granted but he was terminated and refused employment
when he returned. Modelama claimed that he did not fill out
required forms and left without permission. He had no copy of the
forms that he submitted. Alaudin Arjun, a garment tailor at Mehra
Bandhu, was threatened and management tried to illegally terminate
him after he returned from approved leave to go home due to a
family emergency. Such stories were not uncommon amongst
workers who had the same experiences while visiting home after
approved unpaid vacation time.
The illegal termination practices by employers undermine employee
job security and prevent workers from trying to form or register
trade unions. When workers know that they risk illegal termination,
physical violence, and loss of their only source of income, they are
extremely reluctant to organize or form unions. Management
ensures that workers are well aware of the consequences and
termination practices they engage in. This is meant to ensure that
workers are in a state of fear and will accept the terrible working
conditions. In the event that workers are successful in fighting their

Page39
illegal termination cases through conciliation or labour courts, the
employers will transfer the employees to a new unit so that other
employees will not be aware that unions have helped employees to
successfully fight for their rights. Additionally, such illegal
termination practices are in direct violation of Schedule V of the
Industrial Dispute Act, yet employers are never held accountable for
such unfair labour practices and violations. Illegal termination of
employees guarantees that union activity will be limited in factories,
because many employees cannot afford to lose their jobs, as they are
already make minimal wages, often are heavily indebted, and can
barely survive off their salary.
Harassment and Physical Violence
In addition to the numerous human right violations outlined above,
workers who associate with unions and try to organize or register
unions endure constant harassment and acts of violence from
management and facility security personnel. At Viva Global, special
female security guards were hired to harass and attack workers,
including hitting workers with sticks, threatening employees with
knives, punching workers, and dragging female employees by their
hair. At Pearl Global, worker are constantly berated, called “dogs and
donkeys” and told to “go die” with pro-union workers being
specifically targeted for such harassment. At Maruti Suzuki a worker
was beaten and slapped by a supervisor and then dismissed, which
prompted a massive collective protest by the workers. Such
incidents are common and violence is often initiated against
employees by security forces paid by employers to eliminate
organized workers or provoke hostility in union employees. Labour
unrest occurred at Orient Craft, a garment manufacturing facility,
after Naseem Ahmed a worker in the hosiery unit had been stabbed
in the arm with a pair of scissors by Harinder Singh, a labour
contractor hired by Orient Craft. Numerous acts of violence and
harassment including threatened kidnappings, beatings, and sexual
harassment have also been documented at Modelama, where even

Page40
members of the press covering labour disputes have been attacked by
security personnel working on behalf of management. Female
workers are especially targeted for sexual harassment. For example,
at Richa Global a female worker continually refused sexual advances
by her manager which resulted in threats, physical violence toward
the female employee, and character assassinations, eventually
leading to her termination, and the
termination of all female employees
sympathetic to her cause. Often the
threats of violence extend to family
members of workers as well. At Mehra
Bandhu, employees who tried to form a
union and discussed their labour dispute
with BBC news reporters were told that
management knew where they lived and
that people would find them and their
families easily and serious violence
would occur. By continually harassing
and threatening workers, employers
ensure that all employees work in a
perpetual state of fear and will not join
unions out of fear of physical violence
and harassment.
The above tactics and human rights
violations are used by management and
companies to ensure that employees are unable to form unions or are
too afraid to form unions. The unions that do exists are continually
fighting against such practices by management to ensure that
workers have decent wages, acceptable working conditions, and can
feel safe and secure in their employment. Ramesh Ahuja, Assistant
Labour Commissioner, explained that companies know that workers
will only be successfully able to fight and advocate for their rights
with the help of unions and collective bargaining by an organized
female security
guards were hired
to harass and
attack workers,
including hitting
workers with
sticks, threatening
employees with
knives, punching
workers, and
dragging female
employees by
their hair

Page41
and united workforce. He stated that the tactics by the companies
are an effort to eliminate unions out of fear that unionization will
inevitably lead to higher wages, better working conditions, and a
decrease in the power of management. Clearly, the companies know
how powerful unions and collective bargaining can be for employees,
and they are willing to go to whatever lengths required to prevent
unions from forming and advocating for workers’ rights.
***

Page42
THE ROLE OF CONTRACT LABOUR IN
PREVENTING UNIONS
urrently, employers are increasingly turning to contract
labour to break unions and prevent unions from forming in
the workplace. Known as “the dirty secret” that many
employers and corporations use to suppress unions, keep wages low,
and ensure a workforce that is easily exploitable, the use of contract
labour is on the rise especially in the auto and garment industries in
Haryana. The Contract Labour Act of 1970 was enacted to regulate
how and when contract labour can be used and provide specific
guidelines which employers and labour contractors must comply
with when using contract labour. Specifically, the act requires that
employers only use contract labour for work that is perennial in
nature, and prohibits use of contract labour for work traditionally
conducted by permanent employees, or in situations where there is
sufficient work to create positions for permanent employees.
Additionally, the 1971 revisions to the Act state:
“In cases where the workmen employed by the contractor
perform the same or similar kind of work as the workmen
directly employed by the principal employer of the
establishment, the wage rates, holidays, hours of work and
other conditions of service of the workmen of the contractor
shall be the same as applicable to the workman directly
employed by the principal employer of the establishment on
the same or similar kind of work.”
Accordingly, under the Contract Labour Act, employers and labour
contractors are required to obtain licenses and comply with the rules
of the Act only for work positions that cannot be filled by permanent
employees, and where contract labour is used the terms, wages, and
conditions of employment should be similar to the conditions of
employment for permanent employees. Additionally, under
C

Page43
Schedule V of the Industrial Disputes Act it is illegal to use contract
labour to undermine unionization and strip employees of the
benefits of permanent employment. However, employers fail to
follow the laws that are in place, and routinely exploit contract
workers and use them as an endless source of cheap labour and to
undermine unions.
The Rising Numbers of Contract Workers in Haryana
Despite the fact that contract workers are only to be used in situation
in which the work is not sufficient to create positions for permanent
employees, many companies use primarily contract workers in their
production facilities. For example, Retu Singh explained that after
numerous labour disputes raised by GAWU against Modelama the
company began to increasingly use contract workers, even hiring
illegal contract labour recruiters without licenses. Prior to the labour
disputes, Modelama employed 4,000 to 5,000 employees with a
majority of the workers employed as permanent workers. However,
after the production contacts with GAP were terminated due to
ongoing labour unrests and labour violations at the production
facilities, Modelama only employs 500 permanent workers and 1,500
contract workers. Similarly, at Rico the company hires 2,000 to
2,500 permanent employees in addition to 2,500 contract workers
supplied through various labour contractors. At Honda Motorcycle
and Scooter India, the factories operate by employing 4,000 contract
workers and there are only 1,900 permanent worker positions. At
Maruti Suzuki 60 different labour contractors supply the
manufacturing facilities with 2,700 contract workers, and only 1,000
permanent workers are employed. At Sunbeam Auto Ltd, the
company employs 650 permanent workers and 2,500 contract
workers, and the company also employs 800 trainees who are paid
similar wages to contract workers. Hansraj, who is an operator
involved dye casting, has been a trainee for the last 8 years at
Sunbeam and his employer refuses to make him a permanent
employee. Clearly, these numbers suggest that principal employers

Page44
are increasingly turning to labour contractors to supply most of the
labour required for factory production in both the garment and auto
industry. Furthermore, based on the number of contract workers
employed across various factories in Gurgaon and Manesar,
employers can and should be creating permanent positions for these
employees.
In numerous interviews with workers they consistently said that the
biggest problem in their industry is the increased use of labour
contractors. A former worker employed casting auto parts at the
Kiran factory explained that it is impossible to find work in the auto
manufacturing sector without going through a labour contractor. He
also explained that all of the contract workers do the same work as
permanent employees but for less pay and without the other benefits
enjoyed by permanent workers like vacation, sick leave, and bonuses.
Currently looking for work, he had the names and numbers of
several labour contractors that had promised him employment in
various auto factories at substandard wages and in poor working
conditions. An auto worker at JNS Auto Parts also explained that at
his production facility numerous permanent workers were fired after
trying to form a union, and many were rehired as contract workers
performing the same work without the benefits they enjoyed before
they were illegally terminated. His factory currently employs 700
contract workers and 500 permanent employees. The worker also
explained that workers get frustrated and labour unrest results
because contract workers do the same tasks as permanent employees
but for less pay and without benefits. He said that the best thing for
the workers would be to get rid of the labour contractors. Interviews
with workers from the garment industry revealed that companies
including Modelama, Viva Global, and Richa are increasingly using
contract workers and getting rid of permanent positions for workers.
The conversion of permanent employees into contract workers is
common across all the manufacturing facilities in Gurgaon and
Manesar.

Page45
In addition to using illegal contract labour for positions that should
be held by full time employees, many employers try to force
permanent employees to convert to contract workers through
manipulation and coercion. For
example, Modelama will often tell
permanent workers that they must
become contract workers for a
temporary period of time due to work
conditions. Unfortunately, if the
permanent worker accepts such a
request they will never be converted
back to a permanent employee after the
short time period ends. For permanent
employees who refuse to become
contract workers companies will engage
in abusive language, threats of physical
violence, and actual minor acts of
violence. One worker reported that the
violence against females is less extreme
and comes at the hands of special
“helpers” employed by the labour
contractor. Violence against men is
more severe and is perpetuated by guards and other security
personnel and managers. At a GAWU meeting one Modelama
worker explained how she was harassed and threatened by
management because she would not become a contract worker.
When the abuse became too extreme she told management that they
could fire her but she would never become a contract worker. The
management eventually gave up and stopped harassing and
threatening her, and she was able to stay employed as a permanent
employee. However, many employees give in to such pressure and
relinquish their rights as permanent employees. In the auto industry
numerous worker explained that it is common practice for employers
to fire permanent employees without justification and without
all of the contract
workers do the
same work as
permanent
employees but for
less pay and
without the other
benefits enjoyed
by permanent
workers like
vacation, sick
leave, and bonuses

Page46
following proper procedures outlines in the Industrial Disputes Act.
The company will then offer the employee a chance to return to work
upon the condition that they become a contract worker. Similarly,
interviews with workers from the garment industry revealed, that
many garment production facilities will increase production quotas
for permanent employees until the production quotas are impossible
to meet. Once the employee fails to meet the production quotas, the
companies will inform the employee that they can only stay
employed if they become a contract worker. These are by definition
unfair labour practices under Schedule V of the Industrial Disputes
Act, which prohibits employers from terminating employees to
undermine unions in bad faith. Employers are increasingly using
contract workers and eliminating permanent worker positions
because contract workers are easily exploited and less likely to join
or form unions.
Employer Advantages in Using Contract Workers
Employers are increasingly using labour contractors due to the fact
that contract workers are easier to exploit, terminate, and replace
which ensures that labour unrest and unionization will not occur.
Contract workers are specifically exploited through wage theft and
payment of lower wages compared to permanent workers. For
example, at Honda Motorcycle and Scooter India, contract workers
earn around Rs 7,000 a month, have no vacation or sick leave, and
have minimal rights, while permanent employee who perform the
exact same work earn Rs 30,000 a month, have holiday and sick
leave, and are protected by unions. Similarly, at Maruti Suzuki
contract workers are paid Rs 9000 a month without any other
benefits for performing the same work as permanent employees who
earn Rs 18,000 and enjoy bonuses and benefits. The difference in
pay is illegal under the Contract Labour Act, but such provisions are
never enforced and paying contract workers significantly less than
permanent employees is common across all manufacturing
industries. Ramesh Ahuja, Assistant Labour Commissioner in

Page47
Haryana, stated that it is a reality of the economics of production
that contract labour must be used in manufacturing because the
wages paid are significantly less and companies cannot afford to pay
all employees the same wages as permanent workers. He
recommends that all contract workers be paid at least 70 percent of
the wages that permanent employees get for the same work. While
such a suggestion is a step in the right direction, his position
overlooks the fact that paying contract workers significantly less for
the same work as permanent employees is a direct violation of the
Contract Labour Act, and that the Act was specifically intended to
protect contract workers from exploitive labour contracts and
substandard wages.
In addition to paying contract workers significantly less
wages, labour contractors often engage in wage theft from such
employees. One of the most common practices is that labour
contractors fail to pay the contract workers for the total value of the
wages they have earned. The labour contractor simply pays the
workers a portion of the wages that are due and keeps the remaining
money. Numerous workers reported that this type of wage theft is
common practice and they have no choice but to accept the wages
the contractor will release or have their employment terminated.
Similarly, upon illegal termination of contract workers the labour
contractors will also refuse to pay wages and bonuses that are due.
Such practices are common, as a manager at Orient Craft explained,
“I supervise 600 workers, 500 are hired on contract most are
migrants from Bengal, Bihar, some from Nepal. Hiring workers
through contractors makes dealing with workers their headache.”
The manager also explained that “The company makes sure the
workers are paid on time even if it is less than their full wages and
overtime sometimes and pay the contract workers through
contractors but they sometimes keep part of their wages or provident
fund.” Such statements reveal that wage theft is a common practice,
and it also reveals that such wage theft persists primarily because the

Page48
workers are migrants with no choice but to accept the minimal wages
that contractors will pay them. Clearly employers have an economic
incentive to hire contract workers who are easy to exploit and will
likely not be involved in labour protests.
In addition to being cheaper, contract workers are also easier to
terminate because the terms and
conditions of their employment are not
clearly defined and therefore, they can be
terminated or not have their labour
contract renewed at any time. For
example, in 2008 contract workers at
Hero Honda went on strike after trying
to register a union and be recognized by
management for purposes of collective
bargaining, which prompted the
management to lock out 1,800 contract
workers, who were never rehired as
management hired new contract
workers. According to Rakhi Sehgal,
nearly all casual workers were forced into
accepting individual final settlements
with the company and were not rehired,
while over 500 contract workers
continued to fight for reinstatement, and
435 contract workers deployed in production continue to fight for
reinstatement and for registration of their union, Hero Honda Theka
Mazdoor Sangathan. These incidents are common, and through
labour contractors companies can have new employees willing and
ready to work for minimal wages at a moment’s notice. Having such
a large pool of surplus labour has proven to be extremely valuable to
management who can simply request new contract workers in the
event of a labour dispute or labour unrest. It is worth noting that
using contract labour to undermine labour disputes or protests is an
employers are
increasingly using
labour contractors
due to the fact
that contract
workers are easier
to exploit,
terminate, and
replace which
ensures that
labour unrest and
unionization will
not occur

Page49
unfair labour practice and is illegal. However, there are various
record keeping requirements in the contract labour act which make it
time consuming and more difficult to hire licensed and registered
contract workers. As a result, many companies are increasingly
relying on illegal labour contractors to supply them with new
workers who are even easier to exploit as there is no documentation
of their employment with the company.
Illegal labour contractors supply workers on a short term basis, and
in many cases illegal contract workers are employed for a week or
even one day before they are paid wages and released. Using contract
workers on a weekly or even daily basis without permits for such
workers directly violates the Contract Labour Act, which requires
permits which identify which workers are employed and the terms of
their employment as contract workers. Using illegal labour
contractors without proper licenses or permits is lucrative for labour
contractors and minimizes the risk of labour disputes. First, as Retu
Singh explained, using illegal contract labour alleviates the burden of
record keeping for labour contractors as required under the Act.
Additionally, she explained that not having to comply with record
keeping requirements also ensures there will be no relevant records
of the work performed by the contract workers or their employment
at factories. This ensures that such workers cannot bring labour
disputes against the companies and must simply take whatever
wages the labour contractor will pay them, even if such wages are
below the required minimum wage. Such practices cause wage theft
to be rampant and ensure that workers have no way to raise or
substantiate labour disputes. Besides wage theft, using illegal
contract labour is lucrative for principal employers who do not have
to provide Provident Fund or Employee State Insurance
contributions for such employees. Last, with such a large pool of
surplus labour companies can continue to hire illegal labour
contractors and ensure that the workforce turnover is quick enough
to ensure that no unions form and labour disputes do not

Page50
materialize. Furthermore, contract workers are reluctant to unionize
or stand up for their rights because they know that they will be
terminated and illegal labour contractors can supply the employer
with new workers without any impact on production or profitability
at the company.
How Employing Contract Workers Undermines
Unionization Efforts
The use of contract workers undermines the ability of workers
in a factory to effectively unionize and collectively bargain with
management and companies. First, the contract workers lack
sufficient job security to be involved in a union or take part in any
form of protest, as they will likely be terminated without pay. As a
garment worker at Modelama explained, “Contract workers can’t join
the protest because we will be sacked and a new worker will have
your job the next day, the labour contractors have lists of people
waiting for work.” Additionally, during interviews many contract
workers expressed reluctance to joining unions because they claimed
that unions would only help the permanent workers and not the
contract workers. This illustrates how the use of contract workers in
a factory creates divergent interests between permanent employees
and contract workers who have very different interests and
grievances with the companies they work for. While contract
workers are not denied the right to form and join unions, the
temporary nature of their work and job insecurity makes it difficult
for contract workers to organize and form unions. However, because
many companies rely on such a large number of contract workers
there are numerous cases where contract workers have sought to
establish their own unions in factories where the permanent workers
already have a recognized union. For example, in April 2006,
around 3,000 contract workers at Hero Honda staged an organized
protest in an effort to collectively bargain with management because
the plant union and other groups failed to adequately address the
concerns and grievances of the contract workers. Similarly, 2,500

Page51
contract workers at the auto parts manufacturing company Delhi
went on strike demanding only to be paid the legal minimum wage,
because the recognized factory union refused to collectively bargain
on behalf of the contract workers. Clearly, the use of contract
workers divides the interests and bargaining power of employees in
factories as permanent workers and contract workers have different
interests and demands. So long as factories continue to employ
primarily contract workers who lack job security and are easily
exploited it will be difficult for effective unions to form which can
advocate for the best interests of both contract and permanent
employees.
***

Page52
MANAGEMENT PRACTICES TO PREVENT
UNION FORMATION
Due to the consequences and retaliation workers face if they
are involved with or try to form a union, union organization and
formation is a problematic process that must occur with a great deal
of secrecy. Accordingly, union formation and organization is a
complex process in which employers and union organizers use
multiple strategies to out maneuver each other. Despite the fact that
the Indian Constitution guarantees citizens the right to freedom of
association and to form unions, in reality the process is extremely
difficult, and employers resist union formation at all stages.
Consequently, employers have severely oppressed and undermined
workers’ rights to form unions and collectively bargain.
Suppression of Union Activity within the Work Place
Employers severely restrict the ability of workers to form unions and
promote unions within the workplace. Given the severe
consequences that await any worker who is found to be involved with
a union, most union organization activity takes place in secret. As
Retu Singh, a union organizer with GAWU explained, recruiting
workers must occur in secret and union members are extremely
careful to conceal their membership in unions, so that many
employers do not know employees are affiliated with a union till a
labour dispute arises. Consequently, most recruiting is done through
fliers and information provided to workers outside of the workplace.
Additionally, union meeting are conducted in secret in locations
outside of the workplace where the employees are safe to voice their
concerns and do not have to fear retaliation from management. For
example, a local GAWU meeting to vote on whether to strike to
protest the illegal termination was conducted at a secret location,
and as a result only a minimal number of employees were able to be
present, which undermines the effectiveness of the unions. As a

Page53
result of such secrecy, it is extremely difficult to recruit people to join
unions, or effectively inform employees of the existence of a union
and the benefits the union can offer. Retu also explained that
employers will send workers who are really spies for management to
union meeting to report to the management what union activities are
taking place. For this reason, union
member voting must take place in secret
for important union issues such a labor
strikes, protests, or election of union
officers. The secrecy of the union
activities also undermines the legitimacy
of the unions as employees are unsure
what unions have been up to and what
they are doing on behalf of the workers.
Employers know that by suppressing
information about union activities they
can undermine the effectiveness and
power of unions, as well as limit
membership in such unions. For this
reason they have employed numerous
security personnel hired as “helpers”
who are really just present to ensure that
no employees discuss unions or recruit
union members within the workplace.
The presence of these “helpers” instills fear in employees and
ensures that no union organization can occur within the workplace.
When the restriction of union recruitment and organization within
the workplace is combined with the severe consequence employees
will face if they are found to be working with the unions, even
forming a union becomes a difficult task. Additionally, such actions
by employers are unfair labour practices under Schedule V of the
industrial Disputes Act, and therefore, are illegal. Despite such
suppression of union organization, many employees are still brave
enough to unite and form a union and attempt to register the union.
employees
involved in the
unions will be
transferred to new
departments or
reassigned to new
production units
that are less
desirable

Page54
Employer Strategies to Prevent Unionization
If workers have begun to form unions or gather enough support to
attempt to register a union, the employers will resort to numerous
tactics to break the unions. In many cases workers will be bribed to
stop all involvement in unions. As Parimal Sudhakar, an activist for
migrant workers explained, if an influential employee is working
with the unions the management will offer the employee a raise,
bribe money, a job promotion, or other incentive to get the employee
to leave the union. However, if such positive bribes are not effective
management will resort to negative measures to get employees out of
unions. As Retu Singh, explained, management will deny overtime
to union employees who rely on overtime wages to be able to survive,
or the company will cut their hours. For example, Ram, an employee
at Phase Global a major garment manufacturer explained that before
a major strike was likely going to take place several previously pro-
union employees were given new contracts to induce them to leave
the union and not strike. The workers who refused to sign the new
contracts offered eventually had their hours cut and were illegally
terminated when they demanded to be provided with increased
working hours. Similarly, pro-union employees will be passed up for
raises and promotions in the companies and given the least desired
jobs. Retu Singh explained that the unions are fighting for objective
criteria for promotions because there is no way for a union employee
to get promoted unless they resign from the unions. Additionally,
employees involved in the unions will be transferred to new
departments or reassigned to new production units that are less
desirable. For example, Modelama transferred and reassigned 3
workers who helped to try to register a garment worker union on
behalf of Modelama employees. The employees were transferred to
new production facilities which required them to travel up to 2 hours
every day to attend work, and the employees were transferred to less
desirable tailoring work. The harassment is not limited to the
workplace, and many employees explained that landlords will

Page55
threaten union employees with eviction or a raise in rent if they do
not stop working with the unions. Generally such tactics are
sufficient to get most employees to stop being involved with the
unions. As a garment worker who is extremely involved with GAWU
explained, “Only the strong employees can stand up to the
management and will stay in the unions, most employees will take
the bribe, or when the harassment starts they quit working with the
union.” Furthermore, Schedule V of the Industrial Disputes Act was
specifically implemented to ensure that employers do not engage in
such tactics to undermine union activity or effectiveness, however,
employers are not held liable for the rampant unfair labour practices
they use to break unions.
If bribes and negative treatment is not effective in getting employees
to abandon the union, employers will resort to more drastic
measures including harassment, threats of physical violence and
kidnappings. During a peaceful labor protest against Phase Global,
Ram explained that a union leader was kidnapped and severely
beaten, and that during the protest company hired goons came to
beat the protesting workers with clubs and other objects. Similarly,
after a labour protest at Mehara Bandhu Fashion, management
threatened union workers claiming that they knew where the
workers lived and goons would be waiting for them, and the
management also threatened that the employees would be jailed by
the police and that management knew how to frame employees.
During an interview, Mr. Hari Parmaswaran, a prior manager at the
Maruti Suzuki factory, explained that he was expected to harass and
threaten union employees, identify and punish leaders in the union
movement, and create poor working conditions for those in favor of
unions. When he failed to do so he was terminated, and as a result
began to expose corrupt management practices at the company. Such
practices are common and his experience as a manager is typical.
Union organizers and advocates are also threatened with violence
and kidnapping for their help in forming and supporting unions. For

Page56
example, Retu Singh received a threatening phone call from an
illegal labour contractor who threatened to kidnap and kill her if she
exposed the illegal labour contracting. Similarly, leaders and
organizers of the Maruti Suzuki Workers Union were forced to resign
from the union after they were threatened with violence and prison
charges if they did not resign.9 Unfortunately, such threats are not
empty and numerous workers who
organize unions have been kidnapped
and in some cases union employees
have been killed in labour disputes.
Threats of violence also extend to the
family of members of the union
employees as well. Retu Singh has had
the safety of her children and family
threatened numerous times, and
explained that many times the
management will send goons to
workers’ houses to threaten the
families with violence and intimidate
workers so they will leave the union.
In such an atmosphere of intimidation
and violence many unions eventually
dissolve as management resorts to the
most inhumane and drastic tactics to
eliminate unions.
The last tactics that management uses to eliminate and undermine
unions is to divide workers along social, cultural, and religious lines
and create disputes that are unrelated to working conditions. During
an interview, Rakhi Sehgal, Vice President of the Hero Honda Ltd.
Union explained that companies create class, racial, and other basis
to divide workers and get them to fight against each other. Class or

9
http://column.global-labour-university.org/2014/04/workers-unrest-in-automobile-plants-
in.html
Biharis, migrants
from a northern
state in India, and
Muslims are
considered
minorities in these
areas and are
subjected to
discriminatory
actions

Page57
caste based discrimination involves the discriminatory bias that
exists between a multitude of different groups within the workplace.
Animosity exists between religions, gender, class, and geographic
origin. For example, Biharis, migrants from a northern state in India,
and Muslims are considered minorities in these areas and are
subjected to discriminatory actions. Hindus will be hostile to
Muslim workers. Women are treated as one-half of a man, often
receiving unequal pay for the same type of work. When asked about
the source of this animosity, Ms. Seghal replied, “years of social bias
does not and cannot disappear overnight, and likely not in this
generation.” Additionally, employees are already deeply divided
because contract workers and permanent workers have different
grievances against management. In such a work environment
workers are so busy fighting amongst each other that they are often
unwilling or unable to come together to form unions and collectively
bargain to benefit all workers. Once again, the fact that many
workers are migrants is significant, as cultural and ethnic differences
amongst migrant workers are easy to exploit to create divisions
amongst the populations of migrant workers. Furthermore, native
and local populations already hold animosity against migrant
workers who are viewed as taking positions that should be available
for local workers. Many employers are highly aware of these social
divisions and exploit them to ensure that workers will not unite in
the struggle for labour rights.
Sham Unions Created by Management
If there is enough interest in forming a union, management will often
try to form their own union and recruit workers to undermine the
effectiveness of any workers union that is being formed. These pro-
management unions are known as “yellow unions” or “pocket
unions” and are used to divide workers and operate ineffectively to
only provide workers with the illusion that change will happen. Retu
Singh explained that in some companies the management is so
opposed to the idea of unions that they will not even set up a

Page58
management run union, but instead form “work committees” which
are dedicated to working toward addressing grievances, but in reality
do nothing to help the workers. She commented that for these
companies management does not even want employees to think that
forming a union is a possibility, and therefore committees are used.
In management run unions and work committees promises are often
made to workers and then no change will ever result, and the
collective bargaining process and procedures for resolving disputes
or seeking change takes excessively long. All the while, employees
are under the illusion that some change is coming when in reality
nothing actually changes. Such unions and committees are often
formed when a union is beginning to gain support in the workplace.
Rakhi Sehgal, Vice President of the Hero Honda Ltd. Union,
explained that the power relations developed through the yellow
unions create close relationships with factory management which
creates an ineffective means of bargaining or advocating for the
interest of workers. Additionally, many yellow unions are politically
associated which creates additional barriers for workers to effectively
exercise the ability to sit down at the bargaining table with
management.
These yellow unions typically do nothing for the workers, but provide
the appearance that factories are complying with the law. For
example, during the labour disputes at Mehra Bandhu Fashions a
yellow union was used to recruit workers and prevent them from
forming their own independent union. Similarly, at Maruti Suzuki,
the Maruti Udyog Kaamgar Union (MUKU) recruits workers, despite
the fact that workers do not trust the union, the union
representatives are chosen by management, and the union is largely
seen as a prop for the company’s interests.10 The existence of such
management run unions can be a source of labor unrest where
employees seek to create their own independent union which will
actually advocate for workers’ rights. In 2009 at Sunbeam Auto Ltd,

10
http://forbesindia.com/article/special/haryana-the-state-of-discontent/26432/0

The Empty Promise of Freedom of Association: A Study of Anti‐Union Practices in Haryana

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