New Delhi: The government plans to make it mandatory for states to recognize or reject new labour unions within 45 days, following a stand-off between workers and management at the Manesar plant of the country’s largest car maker, MarutiSuzuki India Ltd.
State governments, which are empowered to execute laws relating to trade unions and industrial disputes, currently face no time limits for acting on applications to form labour unions.
“We are aware of the problem, and the recent protests at Maruti Suzuki India Ltd’s Manesar plant have only highlighted the situation emphatically,” said an official in the Union labour ministry, asking not to be identified. “The draft for the changes required in relevant Acts will be in place within a couple of months.”
Asking states to approve or refuse applications for forming new labour unions within a month and a half without fail is crucial, the official said. “You have to work in a time-bound manner. There will be changes both in the Industrial Disputes Act and the Trade Unions Act to put this in place.”
At least 10% of a company’s workforce needs to join hands to form a union or break away from an existing union. A company, too, has to recognize the union after the state labour department does so.
Industry authorities often collude with states to hold up applications for months or have them rejected, said D.L. Sachdeva, secretary, All India Trade Union Congress (Aituc).
“In many companies, there are labour unions that are stage-managed by the management. Such pocket unions generally don’t take care of the interests of the large workforce, creating the need for a new union. The Maruti workers’ protest at Manesar is the best example of this. Unless you allow the formation of new unions, the exploitation by the management will continue,” Sachdeva said.
He said the Union government must step in or labour unrest will escalate. “You have to take decision in a time-bound manner to resolve industrial disputes and workers’ unrest.”
If the state labour commissioner rejects an application for forming a new union, applicants can go to an appellate body against it, said another labour ministry official, also on condition of anonymity. “We are exploring whether this body needs to be set up afresh as independent units, or the cases will go to the lower judiciary.”
Authorities understand that the lower judiciary is burdened with a huge backlog of cases, and going to it may not provide us with a solution in time, this official said.
In that case, the new appellate authority will examine whether the rejection by the state labour commission is correct or if it has taken a decision in collusion with the company’s management. “The appellate body will have full authority to overthrow the labour commission’s decision if it finds that the new application has merits.”
The process will be completed in two months, officials said.
The first official cited above said that following the recent anti-corruption protests led by social activist Anna Hazare, it is now imperative to bring transparency to industrial laws.
Two rounds of labour unrest at Maruti’s Manesar plant, first in June and the second in August and September, held up production and cost a revenue loss of Rs 900 crore, according to the company’s estimate. Its September sales fell 17% compared with a year earlier, Mint reported on Monday, even as most other car makers registered a jump in sales.
The Haryana labour commission has rejected eight applications for the formation of labour unions from various industries in the recent past, said Anil Pawar, a trade union leader working with industrial labourers in the Gurgaon-Manesar industrial belt.
These include the application of Maruti workers and another from workers at Napino Auto and Electronics Ltd, an automobile ancillary manufacturing company.
He said workers can move the labour court, but going there is like “waiting forever”.
“I don’t think there is any problem from our side. Rejection of eight applications in the last couple of years is not a big issue,” said Satwanti Ahlawat, labour commissioner of Haryana.
She said the labour union Act does not specify a time frame for acting on applications for creating unions. “But we have told ourselves that we will complete the procedure in four months.”
Ahlawat also said the protest at Maruti had little to do with the rejection of workers’ application to form a new union. “There might be some undercurrent, but I don’t think this is the reason for the protest.”