Chennai, May 3: They are supposed to be a vanishing breed -- the militant trade unionists who would much rather see a unit sicken and die and their members lose jobs than budge an inch from their unreasonable demands. This at least is the general perception after nearly seven years of economic reforms, liberalisation and globalisation.But there are still some "extremist" trade union leaders who are living in a historical stasis, who see themselves as the agents of destruction of "explotative" entrepreneurs and managers. And some of them are creating havoc in the Madras Export Promotion Zone (MEPZ), one of the special engines created to power India's export drive.
Leading the pack is the local wing of the Centre of Indian Trade Unions (Citu). According to industries located in MEPZ, militant and obscurantist trade unionism by Citu has led to the closure of 10 units in MEPZ, with nearly 3,100 workers losing lucrative jobs.
These units closed down between October 1994 and July 1997. Three of them wereexporting latex gloves, three made readymade garments and one manufactured knitwear. The other three are electronics units, one of which made quartz resonators, one video cassettes and the third printed circuit boards. The main reason for closure was Citu's militancy which exacerbated marketing and financial problems. The latest on the Citu hit list is a company which is less than three years old but has had its net worth almost fully wiped out as on March 31, 1998, because production has plummetted due to a prolonged go-slow and then a strike.
The company is Balmer Lawrie Freight Containers Limited, a listed company in which the public sector Balmer Lawrie has a majority stake. Tectrans GmbH of Hamburg, Germany, and Okura & Co of Japan have minority equity stakes and are giving technical and marketing knowhow.
The investment is about Rs 50 crore and since production commenced in September 1995, it has achieved exports of marine freight containers worth Rs 85 crore per year. At full capacity, the annualexport potential is about Rs 150 crore. The original equity capital was Rs 17.60 crore.Loss up to March 31, 1997, was Rs 5.64 crore, but it took a jump to Rs 12 crore in 1997-98, according to company calculations.The loss up to March 1997 occurred because the company was slowly building up production towards full capacity. In 1997-98, a takeoff was expected but the hopes were shattered because trade union militancy led, on the contrary, to a big fall in production and productivity.The unit has not been able to produce anything since February 10, 1998, when the trade union leadership goaded the workers to go on a strike. This is despite the fact that the Tamil Nadu government has declared MEPZ a public utility service where strikes are banned.Even more irresponsible was the demand for bonus in 1996-97! Whoever heard of bonus in a loss-making enterprise?Citu formed a union in Balmer Lawrie Freight Containers Limited in April 1997. A charter of demands was immediately submitted. A settlement was reached in May1997 after a short strike. The management agreed to recognise the union while the union agreed that the workers would sustain and improve upon the daily throughput of 43 containers, which was then the highest daily average level of production. Plant capacity on two-shift working is 64 containers per day. In mid-September 1997, the union demanded bonus for 1996-97. Discussion on this and other demands started in October. While they were going on, the union went on strike.
During this period, production plummetted due to a go-slow. Daily production hovered around 35 containers, dipping to 26 in November 1997. There has been no production since February 1998.It is not as if the workers were working in sweatshop conditions. Cash earnings and other benefits are much higher than the industry average.Most of the workers live in Chennai and MEPZ is located in an area which is difficult to reach. Therefore the company at its own expense arranged transport at all times from the factory to the MEPZ gate. After thesecond shift at night, company transport takes the workers to specified points in the city.There is a canteen which, apart from tea, snacks, lunch and dinner also gives breakfast to workers in the first shift who have to start very early in the morning.The workers unfortunately are unable to understand that they are the biggest losers because of their go-slow and strike.By not producing the agreed figure of 43 containers per day, the workers have lost the productivity incentive of Rs 1050 per month since May 1997. This adds up to loss of Rs 12,600 per worker. Isn't it time reason prevails? The company is not a goose that lays golden eggs; but, to change the metaphor, is it worth cutting off your nose to please the Citu leadership?
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
