NEW DELHI, Nov 23: Picture this: No messy wage settlements. No protracted productivity negotiations. Freedom to fix worker compensation annually on the basis of corporate performance. And no bloody battles with the union. If that sounds like a management miracle, take heart. From strikes to striking back, the management at Eicher Tractor Ltd's Alwar (Rajasthan) unit is brewing just such a labour revolution: in December 1996, the Eicher Tractor Karamchari Sangh at the engine-manufacturing unit at Alwar agreed to waive its right to negotiate a wage settlement and entrusted the management with the responsibility of fixing wages for workers on an annual basis.

Now, one year later, the Sangh is relieved that the experiment has worked: there have been no strikes, no labour problems, no indiscipline. The management is slowly beginning to exult: productivity is shooting up, manpower costs are tumbling, and, most important of all, morale is at an all time high.

Admits Bishan Chand Sharma, general secretary, Eicher Tractor Karamchari Sangh, ``We have stopped fighting over wages and now concentrate on welfare schemes for our workers.'' Smiles Jagdeesh Rawat, worker, and district general secretary of the Bhartia Mazdoor Sangh, ``Other unions laugh when I tell them about what is happening here. They think the management has bribed us or bullied us.''

Actually, it's neither. Instead, by meticulously planning strategy, the Alwar management team, led by general manager KK Vij, has proved that there is a simple formula -- call it PACT -- for diffusing an explosive union. But to get results, first the management must:

P: Practice what it preaches, fairly.

A: Act rather than speak while building relationships.

C: Communicate the right message down the line.

T: Try to build trust at all times.

Implemented over a three year period -- the starting point was the bitter seven-month battle over the three-year wage pact clinched in July 1994 -- the process had four tenets at heart. One, no union is really able to extract more than the management is willing to give. Two, the union knows this but still battles for more, in order to prove its worth. Three, workers do not realise that managers are not ``owners'' but employees just like them, and therefore do not trust them. Four, if managers and staffers get annual raises without forming a union, why do workers feel the need for a union to hammer out wage settlements?

PACT is thus a vehicle for driving home these homilies into the minds of the workers and managers, and bringing about a paradigm shift from a `worker-union-management chain' to a `worker-management-and-union triangle'. It's a long and arduous process, but as Eicher's Alwar management has proved, even rabid unions can be defanged. Here's how:

* PRACTICE: The plinth of implementing PACT rests on establishing the credibility of the management -- and ensuring that the union has no reason to flog the management's weaknesses for its own selfish ends. Says Vij, ``Only if you walk the talk will the workers start respecting you and trusting you instead of the union.''

So when the Alwar management promised to reduce fatigue on the shopfloor, no time or money was spared to bring in low-cost automation. Today, no worker has to lift more than 10 kg manually, for any job.

Moreover, the company's basic philosophy -- that across all levels, all employees are treated fairly and equally -- is rigorously enforced in matters of rewards and punishment. Discipline, for example, is strictly implemented in terms of attendance and productivity. In the last few months, Vij -- who is the first to enter the factory gates every day at 7.45 am -- has not only chargesheeted a chronic absentee worker, he has also dismissed a non-performing executive. Similarly, all union workers have been warned that their productivity levels have to be role models for other workers, and no slackening off is allowed under the pretext of union chores. Says Devraj Sharma, deputy manager, personnel, ``We not only ensure that justice is done but also ensure that justice is seen to be done.''

The carrots are shared equally too. Last year, the shop floor was aircooled to bring it in line with the airconditioned environs of the corporate office. When union members complained that there was a quality difference between the tea served to the workers and the executives, Vij readily agreed to provide Green Label teabags on the shopfloor -- if the workers agreed to forego their free tea and pay Rs 2 a cup just like the executives did. Says Vij, ``If I am not seen to be fair in every respect, how will I convince them that their wage increases will effectively neutralise inflation just as it is done for staffers and managers?''

* ACT: Here the basic principle was clear: unless the management invests directly in relationship building, it cannot draw the dividend of trust from the workers. Instead, the more the emotional distance from workers, the more it empowers the union. So, it's not just enough that all the departments go on an annual family picnic. The management has to be closely clued into the day-to-day issues in workers' lives.

Supervisors at the Alwar factory are thus trained to play mentor. They utilise tea breaks to tune into worker problems and insecurities -- and report them faithfully back to the management. It's not just an early warning signal for brewing trouble. All rites of passage -- births, deaths, marriages -- are also meticulously reported and followed up. If any employee is celebrating/mourning, it is mandatory for the immediate superior to attend the event and take proactive action.

Some samples? Last year, when Himmat Singh, a worker, died in a road accident, the factory manager discovered that his wife was a cruel stepmother to Himmat's only child, a 10-year-old girl. The management immediately swung into action to transfer Himmat's dues into a water-tight trust in the child's name -- despite police pressure, a legal notice, and threats from goons.

Similarly, when the company set up a social security scheme -- for every eight per cent of salary a worker contributed to a pension fund, the management would contribute an equal amount -- it found that the union began spreading a malicious rumour that this was the company's way of fleecing workers. Lalit Verma, deputy general manager, operations, counter-acted: he brought in experts from LIC to talk to workers and began holding small information gatherings on the shopfloor.

Group by group all the workers were covered, and their doubts cleared painstakingly. Finally, the penny dropped: the management was securing their future by forcing workers to save, and not cheating them of their current earnings, as propagated by the union. Says Verma, ``Today every worker knows that whatever happens to him, his family and children will be well taken care of by us. It's no longer just an employee-employer relationship.''

* COMMUNICATE: Realising that often distorted communication is the union's most powerful tool for manipulation, the Alwar management decided to open up information highways at the plant. First, to ensure open and accurate communication, Vij and his team decided to go public with all corporate matters.

Ergo: the minutes of all meetings -- from the apex Tractor Executive Committee (TEC) meeting down to the Quality Review Per Month (QRPM) report -- are pinned up on the factory notice board so that it is clear, at all times, what the management is up to. Says Vij, ``People relate better to glass boxes than black boxes. It also becomes clear that the management does not have any secret anti-labour agendas.''

In addition, every day starts with a morning meeting, in which the management team meticulously briefs supervisors on what they have to say to the workers -- down to the exact words to use and the responses to give to all possible queries. Finally, every three months, all the 600-plus employees gather for an Open House where the management team discusses issues and corporate strategy, and workers are free to raise any question or query.

* TRUST: This was a toughie: how does the management circumvent the union which stands between workers and management like a concrete wall of mistrust and misinformation? Vij realised that much of the power the union derived actually came from getting papers signed by managers on behalf of workers -- loan applications, leave petitions, request for medical perks, etc. So as a first step, the Alwar management decided not to sign any paper brought in by a union member.

Then, on one pretext or the other, each manager was trained to ensure that the worker himself came in with his request and dealt directly with the manager. The manager would then make the worker sit down, make him feel comfortable, chat about his family, and encourage him to talk about his problems -- and most importantly, constantly keep explaining the management's priorities. Significantly, in the initial stages of the exercise, even if the worker's demand was unreasonable, the manager would sign the request, just to prove how easy it was to deal with the management.

Within weeks, the invisible wall began crumbling. Workers not only began to overcome their awe of ``sahib's cabin'' and ignorance about corporate matters, they also began to realise how the union had been taking credit for no reason at all. Secondly, managers now had a direct line of communication with workers and soon began greeting workers by names -- and asking about their individual problems. Over time, this personal bond became a powerful wrench for dismantling the union's hold over the workers' psychology.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.