Lay-off is rampant in many industries. Industrial wages are down, below the level of 2007. The real income of industrial workers is receding. The workers are yet to recover from the price shock of 2007 when the inflation rate (WPI) had shot up to 13 per cent and the prices of wage goods went up by almost 20 per cent. These prices never came down. On top, the consumer price index this year galloped to 14 per cent, only a week ago.

Unfortunately for workers, wages have hardly increased in the last three years. These wages are generally fixed for a three-year term through bipartite or tripartite negotiations. The dearness allowance for industrial workers rarely covers the deficit in the real income caused by the inflation, especially for wage goods, family healthcare and children's education expenses. Workers, who are the worst victims of any economic down-turn, have suffered silently during the last 18 months. Millions, connected with export industry, lost jobs during this period. Others had to make do with near-stagnant income as the industrial production rate slipped for want of domestic and export demand.

Now that the economy is doing better and majority of large and medium-sized corporations have shown encouraging second quarter financial results, the working class rightfully demands better treatment from their employers in terms of wages and benefits. The ongoing labour strife at Rico Auto's Haryana unit or Haldia Petrochemicals are not isolated cases. Scores of industrial units in Maharashtra, Tamil Nadu, western UP, Andhra Pradesh, West Bengal and Karnataka are lying closed as employers dither on new wage settlement with unions. Many more units are facing labour action, vitiating the industrial relations climate in several parts of the country.

Workers feel cheated as industrial prosperity is not getting reflected in their wages. The income disparity between the government servants and industrial labour has been growing. The insensitivity towards the plight of industrial workers on the part of both private sector employers and the government is appalling. The government has practically washed its hands of industrial relations and labour welfare matters, leaving them to be settled by the managements. Workers unions find themselves increasingly cornered by corporate management, a good number of which are against even formation of unions in their enterprises and resort to restrictive employment practices by offering contract jobs and imposing unfair exit terms and conditions, among others.

The AITUC-led union at Gurgaon-based Rico Auto, a key auto parts supplier to Maruti Suzuki, Hero Honda and Tata Motors, is fighting the management of the Rs. 850-crore motor parts giant with its back to the wall to bring the latter on a negotiating table for collective bargaining. Rico has reportedly lost business worth Rs. 40 crore on account of the strike in its four plants in Haryana in the last two months, but would not negotiate with workers' union. Rico has as many as seven factories in different locations as part of its business continuity strategy to ensure that its operations are least impacted by both internal and external factors such as labour unrest in one plant or supply bottleneck in the other.

More and more industrial corporations are going in for multiple production locations as part of their business continuity plans. While the Tatas were among the first to follow the policy of locational dispersal even for heavy industries such as steel and automobile, others have been following the strategy with rich dividends to keep their enterprises less susceptible to labour unrest and supply bottleneck for both raw materials and finished goods and for greater market access. The government's economic reform policy has been of particular help to industrial enterprises to spread their business risks, including those arising out of possible labour action.

Unions, on their part, have been slow to react to the management policy to split the labour unity by adopting the tactic of splitting production locations and non-recognition of legitimate unions. These unions have failed to evolve their own strategy to counter the management move with such tactics as forming pan-industry unions, united forums and joint union actions. The latter exist in more industrialised countries such as the European Union members, Canada and the United States. The unions in these developed countries are so strong that they can even stop corporate take-overs, acquisitions and mergers. They forced the Lakshmi Mittal group to abandon its bid to take over a Bethlehem Steel plant in the US and forced Tata Steel to accept their demands before the Indian business giant took over the Anglo-Dutch Corus Steel. Such strong labour actions are unthinkable in India.

Unfortunately, the factors standing in the way of a greater labour unity and effective labour movement in India are the multiplicity of unions because of their political party affiliations and their general unwillingness to form a united front even though their so-called political masters may have one. The unions in one company or in one large production complex could use their representative strength or support base among workers to form an apex bargaining structure built on the pyramid theory. Such pyramid union structures exist in some of the industrial complexes with tremendous effect. The best example of it is the workers' union of the Bata Shoe Company at Batanagar in West Bengal. The state also has pan-industry labour unions for tea, jute and engineering industries, although their influence has lately eroded because of frequent political interventions from CPI-M, the principal constituent of West Bengal's business-friendly Left Front government.

The latest round of post-recession labour unrest, spontaneous and driven exclusively by high price inflation of wage goods and falling real income of workers, should serve as a warning to all concerned - the government, the employers and trade unions - to tackle the growing discontentment among India's large industrial workforce, the backbone of the country's economy. The government needs to act fast to control the rise in prices of wage goods to protect the pockets of poor wage earners. On the other hand, employers must stop treating workers as slave labour or class enemies and listen to their demands to find reasonable settlements through bilateral or tripartite negotiations. The situation also provides a good opportunity for trade unions to work together and strategise towards building a responsible labour movement to protect the interest of workers, who are getting increasingly oppressed and cornered under the present neo-capitalist system. (IPA Service)