An orchestrated mob violence - The Maruti Episode

GYANENDRA KUMAR KASHYAP

It is deplorable that a tiff over an alleged caste based slur would snowball into one of the goriest incidents of recent times. The mass violence at Maruti’s Manesar plant on July 18, 2012 brings to the fore the ugly face of industrial unrest and labor violence. Is it not shocking as to how workers who supposedly staged a sit-in post their shift could arrange iron rods, which actually fit into the car door, and distribute it amongst themselves? Perhaps there is more to it then what meets the eye; how else can one explain the brutal way in which Awanish Kumar Dev  - General Manager, Human Resources was charred to death and over 90 others who have been injured.  If this is not a case of well orchestrated mob violence, then what is it? There can be no justification that a casteist remark against a permanent worker, who belongs to the Scheduled Caste category, led to what is being described as spontaneous mob violence.

For the last one year, Maruti has been grappling with problems related to trade unions. In fact what started as a 13 day strike in June 2011 and apparently seemed to be a settled issue in October 2011, after the signing of a tripartite agreement between the Maruti Suzuki management, workers and Haryana government representatives, seems to have been a temporary nine month lull. In 2011, three separate strikes at Maruti Suzuki caused a total production loss of approximately 83,000 units worth more than $500 million. However the recent mob fury questions the very basic tenets as to why trade unions exist – to help in effective communication between the workers and the management so that differences of opinion do not turn into major conflicts. While condemning the violence, there have been a few commentators who have succinctly used the veil of social inequity and impatience of the new generation young workers at Maruti’s Manesar plant to in a way justify the deep rage and yes the brutal murder too. Even if we accept that with changing paradigms trade unionism is losing its clout or that in virtual absence of unions companies have become either too paternalistic or too dictatorial; rioting and setting to fire the very properties that are the source of their very own bread and butter, is no greatness to prove a point, their identity or relevance. Isn’t maintaining a cordial relation between management and labor a fundamental pillar of trade unions?

While labor unrests are not uncommon in India, the frequency and level of violence seen at Maruti plant over the last one year raises concerns on the viability of business environment in the long run in the region. According to reports; workers armed with iron rods and wooden sticks rioted through the plant in Manesar, attacking managers, smashing equipment and setting fire to parts of the factory. Reports in media also state that when all these happened, the police remained mute spectators. The workers have a different tale to tell, however true that might be, in no way does it justify their inhumane behavior.  The company for its part alleges that the violence was an orchestrated act of mob. In its statement the company shares, “The sequence of events began in the morning with a worker beating up a supervisor on the shop floor. The workers’ union prevented the management from taking disciplinary action against the worker. As part of their protest, they prevented executives and managers from leaving the factory after working hours. They blocked the exit gates and held the executives hostage.”

Can this be a cause?

Can the wage differential between the permanent and contract employees – the permanent employees at Maruti earn Rs.18, 000 per month while the temporary workers are paid 6000-7000 per month – be a reason for the outburst?  Well a few commentators who have looked at the current problem purely from a social inequality prism; for them perhaps this could be a plausible reason. Or is it because the company run unions (yes at Maruti – the unions are widely believed to be a company run union) wants to break free and associate themselves with larger nationally recognized unions? For the records, Maruti Udyog Kamgar Union is not allowed to associate with any national level recognized unions.  Whatever be the underlying reasons; violence and killing innocent people is void of any sane logic and is highly condemnable.

While nobody can support this kind of mindless violence; the pertinent question is: Why were the workers driven to such extremes that they took the risk of losing their jobs and indulged in mayhem?

The Action

Surprisingly, out of the 3000 odd workers who led the rampage, a mere 97 employees have been arrested – and yes none of them are trade union leaders.  Those who have been arrested and produced before a local magistrate have been accused of various charges including rioting with weapons, murder, attempt to murder, unlawful assembly, assault and trespass. While the police continue with their inquiries; Maruti – which has till date maintained silence on who the perpetrators are -  for its part will conduct its own independent probe into the events at their Manesar plant to determine the issue that lead to the current problem.  The Centre too is looking into the labour unrest at the Maruti Suzuki’s Manesar plant. The corporate affairs ministry will soon take up the matter with other related ministries including the labor ministry to examine the case and address the issue in a structured manner. The Centre’s action has become all the more important as the incident would further dent India as an investment destination. In fact the large scale violence by workers that rocked Maruti Suzuki’s Manesar plant has led the Ministry of Home Affairs to alert the Intelligence Bureau (IB) to probe whether there is any Maoist influence on trade unions in industrial belts in the National Capital Region (NCR). There are reports which state that at least three trade unions active in the region are either fronts of the CPI (Maoist) or are Naxal sympathizers who want to destabilize the economic environment and create industrial unrest.  In response the Left parties have been quick to term it as a “bogus theory” floated to hide the nexus between the government and the management. For now, the central intelligence agencies and the Haryana police have not found any evidence so far to link the violence at Maruti factory at Manesar to any Maoist organization.

 

The Reactions

Since last October, there have been news that Maruti is planning to relocate; the recent unrest just escalated such news gaining more ground. At a press conference in New Delhi, the CEO Shinzo Nakanishi clarified the company’s stance in terms of expansion and relocation.  R C Bhargava, Chairman, Maruti Suzuki, laid to rest the view emerging from some quarters that the company may move out of Manesar. He said, “There is no question of moving out of Manesar. This thought of us moving out of here is complete fiction.”  Further as fallout of this episode, Maruti will stop hiring contract employees. At present contract employees constitute 50-55 percent of the workforce at Maruti. "We will not have any contract worker in the core areas of manufacturing after March 2013. We have decided to change the mode of employment and all future recruitment would be done through the HR department to remove all distortions," said Bhargava.

There have been no concerted reactions from industry bodies such as FICCI, CII, ASSOCHAM and human rights activists. It is apparent that human rights activists swing into action only when there are instances of communal rights. It seems that the violations of human rights of working middle class is not glamorous enough and does not need to be raised. Nonetheless there have been a few voices here and there condemning the act of violence and the senseless killing of a wage earning employee – a well intentioned mediator who was responsibly carrying out his duty to bring about a rapprochement between the feuding groups. The HR community is of the opinion that the industrial relation practices and supporting government/trade union institutions are still time wrapped and woefully inadequate to extend a meaningful walking partnership, and that association bodies must play an important role to sensitize such gaps and help in bridging them.  “At NHRD Network we strongly condemn such deplorable acts of violence. Infact we are extremely concerned at the increasing frequency of such incidents in the recent past, be it at Pricol, or Madras Cements or Regency Ceramics or Honda Motorcycle. Such incidents would have a severe impact on the brand equity of India, and also impact long-term competitiveness of Indian industry,” said Prince Augustin, National Secretary, NHRD Network. 

Interestingly the mahapanchayat held by over 100 villages at Dhana in Manesar, alleged that the July 18, 2011 incident was politically motivated to hamper the industrial growth and requested Maruti to stay in Gurgaon. The request makes economic sense too, for the company has generated employment and is a source of steady livelihood for villagers around the industrial belt. If this industry moves out of here, it will mean shifting out of 350 smaller industries directly associated with it thereby hurting the livelihood of villagers in and around the IMT belt.

The result…

An innocent life is no more, a few are still in the ICU and the share price of the auto major has hit two years low after violence shutdown factory. It is estimated that Maruti which lost around $15 million per day in missed production during the strikes last year stands to lose $12-$16 million per day during the current shutdown.