Whether one is concerned about the general economy, the auto industry or the labour force, one would welcome the fact that the Maruti Suzuki plant at Manesar has finally reopened after a violence-induced hiatus during which it lost up to R680 million a day. But the one group that has been conspicuous in its cheerless response is the unions. On Monday, the plant reopened, albeit with heavy police protection. On Tuesday, a number of labour unions demanded of the Union labour and employment minister M Mallikarjun Kharge that all sacked workers be taken back, pending investigation. On July 18, sections of the plant were torched, people jumped from first-floor windows to escape the blaze, one manager burnt to death, around a 100 people had to be hospitalised, and production had to be shut down for a month. But the unions insist that all the benefit of doubt should be vested with their brethren: let them be presumed innocent till the courts pronounce otherwise, however many years from now. But it is quite irrational to expect Maruti to resume production with employees in whom it has quite rationally lost faith. It is equally irrational not to appreciate the appeasement being practised by the management. For instance, contract workers are being given a chance for regular employment via screening tests beginning in September, and the sacked permanent workers are being given three months? pay plus 15 days? pay for every completed year of service. Sure, all this is only in the management?s interest, which is to begin to make up production shortfalls, especially unaffordable in today?s challenging market conditions. But how myopic are unions that don?t see their interests overlapping in this instance? Myopically, they demand more permanent jobs but refuse to concede hire-and-fire flexibility in exchange. Contractual rights are constantly being championed, but contractual obligations get nary a slogan. As Manish Sabharwal of Teamlease Services persuasively argues, between them, rigid labour laws and obdurate unions have ensured that 100% of net job creation in the last 20 years has been in the low-productivity and sub-scale unorganised sector.
Everyone has long known such obduracy spelt doom for industry and unemployment in Detroit. Everyone is now discovering that it?s the opposite that has held up Germany while its neighbours are sinking?factory workers have accepted both cuts in once sacrosanct benefits and modest pay rises sanguinely, so that employment has remained relatively robust. Our unions would do well to study the Mittelstand model.
