Skip to main content

Manesar: Mass Lay-offs Loom Over Workers; Industry, Unions Ask For More to Avert Distress

Industry demands that the government address the liquidity crisis amid restarting production; unions, on the other hand, worry over putting workers at risk of getting infected.
Manesar: Mass Lay-offs Loom Over Workers; Industry, Unions Ask For More to Avert Distress

Representational Image. Image Courtesy: Livemint

As the manufacturing units are finding it difficult to swing back into action, even when the lockdown norms have been relaxed, workers in Manesar’s Industrial Model Township (IMT) in Haryana are met with a looming uncertainty over their jobs.

Both trade unions and industry experts fear that in absence of a concrete plan by the government, mass lay-offs and retrenchments await many, first cries of which have already started to emerge in the industrial hub, which houses about 2,000 factories.

Bellsonica Auto Component India Pvt. Ltd., a vendor of Maruti Suzuki, sacked around 290 contractual workers last week. The company cited difficulty in paying salaries as a reason. In a letter dated May 25, the employees’ union condemned the move, alleging that the company is “passing the burden” of coronavirus-induced lockdown on to the workers.

“The company has retrenched two-third of its contractual staff. On the other hand, the management has indicated that only 40% of the total workforce will be called to work for next three to four months. If this is how it is to be continued, there is no economic security that lies with an individual worker,” said Jasbir Singh, general secretary of employees’ union in Bellsonica. Currently, only 400  employees have been called to work out of a staff of 1,300.

In a similar incident, Dharukhera’s plant of Rico Auto Industries Ltd., another automotive component company,  laid off 119 of its permanent workers. Slump in demand due to COVID-19 crisis was cited as a reason behind the move.

Main reason behind such contraction in work staff by companies is the sub-optimal production pace in the major auto companies, namely, Maruti Suzuki, Honda and Hero.

In its revised restriction norms for industries and commercial establishments, issued by Gurugram’s district administration, all units, outside containment zones, were allowed to operate with full staff.

Despite the permission, however, production has only resumed in about 50% of the manufacturing units in IMT, NewsClick has learnt. In Maruti Suzuki’s Manesar plant, only about 20% to 25% of the total workforce is being called, informed Kuldeep Janghu, general secretary of Maruti Udyog Kamgar Union.

There are three major reasons behind this, as explained by Manmohan Gaind, general secretary of Manesar Industries Welfare Association. “The factories were permitted to resume production; however, restrictions over inter-state transportation continue to remain in place. Most of the workers, technical staff, in establishments in Manesar are not being able to travel from Delhi,” he said.

The decision to resume inter-state bus service was rolled back by the Haryana government, owing to the concern over high possibility of spread of the virus, especially from Delhi, where positive cases are high.

Also read: Covid-19: Hasty Lockdowns, Economic Crises and Popular PMs

In addition to this, there is a prevailing liquidity crisis that has gripped the units. “Suppliers are demanding up-front payments for raw material now. The government has sought to boost the credit limit of MSMEs. But, ground realities show that woes persist for units,” Gaind told NewsClick.

Gaind believed that if this continues, mass lay-offs will be an option that the companies will eventually go for. This, however, can be averted, according to him, if the liquidity issues of the companies are addressed which will help in resumption of production in full capacity.

Interestingly, trade unions demand the same – optimal level of production – which will ensure that the workers are employed and they don’t die of hunger first. “Workers are [sandwiched] between two brewing crisis – one of corona; the other is of unemployment and hunger,” said Satbir Singh of Centre of Indian Trade Unions (CITU), “as a result, already a big section of migrant workers have already left Manesar and gone back to their natives.”

According to Singh, the government must ensure that the livelihood of a worker is protected amid the coronavirus crisis.

However, the logic of resuming production even after two months of nationwide lockdown is not free of risks either, allege other workers’ bodies, as the spread of viral infection presents no indication of slowing down.

Only two days back, an employee at Maruti Suzuki’s plant in Manesar tested positive for COVID-19. Similarly, three employees at Hyundai Motor Chennai’s plant were found to be infected with the virus.

“Many factory floors are not equipped to follow social distancing norms. In most of the cases, workers are provided with poor quality of protective gears. These are not the times to put workers at risk of getting infected by restarting the economic activities,” said Anant Vats of Automobile Industry Contract Workers Union (AICWU).

According to Vats, workers must be given salaried holidays which will ensure that workers aren’t pushed to precariousness amid the lockdown. “On average, only about five per cent of total turnover in Indian companies goes to salaries and wages. This must be covered by the government.” he said.

Also read: Labour 'Exodus' Brings Maharashtra Transport Industry to Standtill

Get the latest reports & analysis with people's perspective on Protests, movements & deep analytical videos, discussions of the current affairs in your Telegram app. Subscribe to NewsClick's Telegram channel & get Real-Time updates on stories, as they get published on our website.

Subscribe Newsclick On Telegram