Business assumes labour to be a passive player, and wants the government to be neutral on the side of management. This approach seems to have been inspired by the failure of the prolonged Datta Samant-led Mumbai textile strike. But the textile industry was facing obsolescence. What is needed in the reform milieu is a working relationship between management and labour in support of industrial growth.

So what are the rules of the game in the reform milieu? The question is not even asked. In the sunset jute mill industry, workers accepted depressed wages, eschewed the annual bonus claim, etc. Even so, the CEO of a jute mill fired point-blank at two workers; enraged labour burnt the CEO and the HRD manager of the mill. Obviously, the grievance settlement procedure, if any, did not meet the requirements of the situation.

The West Bengal case is cited to drive home the point that management-labour relations cannot be placed in a vacuum. There must be rights and obligations on the part of both management and labour. If these are fudged,the right to hire and fire will become an arbitrary affair. Note that implicit in the employer's right is the absence of arbitration and of grievance articulation.

Under the existing arrangement,management needs to obtain the permission of the state government concerned to close an industrial unit or lay off workers. State governments are loth to give approval ,which will obviously be politically unpopular. But this haemorrhages enterprises, drives them into sickness and burgeons unemployment. Hence business's demand for the right to hire and fire.

The rationale of the demand seems fair enough. But once government decides to withdraw from the scene, how will management enforce its legal right? The labour force is unlikely to remain passive for long, especially if it sees industrial unit after unit disengaging employees and downing shutters. It is extremely unlikely that state power will back the employer's right. This is where the rules of the game come in as also the issue of rights and obligations.

Business has greeted with one voice the Maharashtra government's intent to give the right to hire and fire to managements of establishments with employee strength upto 300. This casts an awesome responsibility on business in the absence of even a minimum unemployment insurance. On the cards, is a rise in trade union militancy.

The 1990s have seen but modest growth in employment in manufacturing. This has hardly taken care of the growing backlog of unemployed. There has been a decline in employment in the informal sector. In the reform milieu, manufacturing industry in particular is subject to business cycles.

Recession hits the steel and steel- using industry at one time,paper and pulp-making at another. Industry-wise trade union regrouping is likely. It is just possible that trade unions will acquire a new sophistication: keep a tab on likely market developments, on technology advance and act as a pressure group on management to demand retraining and reskilling of labour.

Business will have to learn to think of alternatives to lay-offs and sack orders.