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

1. MARUTI SUZUKI’S
PROLONGED LABOUR PAIN !
-By
Meghana Bhogle
Snehal Kadam

2. MARUTI SUZUKI’S MANESAR
PLANT
Inaugurated in February 2007
Workers from Jeend and Jhajjar regions of
Haryana
• Regular : 950
• Trainees : 400
• Contract workers : 700
• Apprentices : 400

3. FLASHBACK
2008 : Slowdown in Car sales
Maruti reduces investment in mfg. capacity
2010 : Maruti experiences a spurt in demand
Manesar plant starts producing 350,000
cars/year
Worker incentives are aligned to production to
ensure worker buy-in

4. JUNE 4, 2011
Production stops at Manesar plant
Reason : Workers demand formation of a new
independent union (MSEU) for Manesar
facility

5. AUGUST 29,2011
50% production cut at Manesar facility
Reason : Workers refuse to sign a ‘Good
conduct’ bond

6. SEPTEMBER 15, 2011
2 day full closure of Suzuki Motors’ Indian
operations
Reason : To support striking workers of Manesar

7. OCTOBER 7, 2011
Full closure of Suzuki Motors’ Indian operations
Reason : Demand for restoration of jobs of 1200
contract workers at Manesar

8. SPI JOINS IN
•The strike at Suzuki Powertrain dealt a blow to
Suzuki's operations in India
•Within days, the disruption in the supply chain
started choking production at the Gurgaon plant
•Complete halt in production of models like Swift
and DZire

9. Haryana government declares the
strike as
ILLEGAL !

10. LEGAL & REGULATORY
ASPECTS
OF THE STRIKE

11. INDUSTRIAL DISPUTES
ACT, 1947
To secure industrial peace and harmony by
providing machinery & procedure for
investigation and settlement of disputes by
negotiation

12. UNFAIR LABOUR PRACTICES
Chapter V-C
No employer or workman or a trade union,
whether registered under the Trade Unions
Act, 1926 or not, shall commit any unfair
labour practice

13. UNFAIR LABOUR PRACTICES
•Interfering in TU activities
•Acts of force & violence

14. PROHIBITION OF STRIKES
Chapter V (Section 22)
No person employed in a public utility
shall go on a strike
(a) without giving to the employer notice of
strike, as herein-after provided, within six
weeks before striking; or
(b) within fourteen days of giving such notice

15. BREACH OF SETTLEMENT
Chapter VI (Section 29)
Any person who commits a breach of
settlement shall be punishable with
imprisonment, fine or both and the court may
direct the fine to the person who has been
injured by the breach

16. TRADE UNIONS ACT, 1926
Registration, rights, liabilities and
responsibilities of Trade unions & ensures
proper utilisation of funds
Gives legal status to registered Trade unions

17. CORE LABOUR STANDARDS?
Freedom of association and
right to collective bargaining

18. PROPORTION OF OFFICE-
BEARERS
Chapter III (Section 22)
Not less than one-half of the total number of
every registered Trade Union shall be persons
actually engaged in the industry with which
the Trade Union is connected

19. MARUTI FILES A CIVIL WRIT
PETITION
The Company filed a civil writ petition seeking
and obtaining a direction from the Punjab and
Haryana High Court, requiring the workers to
observe their strike at least 100 metres away
from the facility premises of the plant and to
refrain from disruption of the plant’s operation

20. OCTOBER 21, 2011
End of strikes
•A tripartite agreement
•Grievance Redressal Committee
•Labour Welfare Committee

21. NOVEMBER 4, 2011
TU leaders, Sonu Gujjar &
Shiv Kumar, quit with
Rs 40 lakh payout
28 others leave with Rs.16 lakh

22. MARUTI’S LOSSES
•June strike costed almost $95 million
•August strike costed around $135 million
•While the government is estimated to have
lost around Rs.350 crore in excise revenue, the
company itself has lost over Rs.1,500 crore in
production
•The share price of the company fell nearly
18% since June

23. MARUTI’S LOSSES
•Total production loss over 51000 units
•Rs 1600 crore in lost revenues

24. THANK YOU