Auto industry worries about Gurgaon spark

Gurgaon is one of the three key manufacturing hubs of the $7 billion auto component industry. While dealing with labour issues is a part and parcel of doing business anywhere in the country, firms in the high-profile zone have been facing more than their fair share of it recently.

The incident has heightened fears. For one, its proximity to Delhi — and the resultant spotlight — has already added weight to the Japanese ambassador’s statement that FDI inflows would suffer.

Honda Motorcycles and Scooters India (HMSI) says the first signs of employee ‘‘insubordination and gross indiscipline’’ surfaced last December. Despite a Rs 3,000 across-the-board hike to its 1,800 line associates in April, production continued to suffer and touched a low of 30 per cent of capacity at one stage, and there were days on end where no work was done at the plant.

Says Honda’s Human Resource head Vivek Vishwanath, ‘‘In the last few months, we have suffered extensive losses to the tune of over Rs 120 crore.’’

Problems reached a peak when Honda President Y. Aoshima was confronted by workers on May 24. A month later, Honda authorities suspended 50 workers and terminated the services of four others. At the core of the unrest lay the workers’ demand for higher wages. The contract-regular worker divide in terms of pay and perks compounded problems further. Honda has 1,000 regular and 800 contract workers.

‘‘The government is also responsible partly for this labour discontent. Ever since the new government took over, it is being conveyed that contract labour is not in the best interests of workers who are being underpaid and deprived of other benefits,’’ said Gurgaon Industrial Association President Jagannath Mangla.

Honda thought that their problem was over when 1,600 of the striking employees signed a good conduct undertaking. However, even five days later, not even a single person joined back at work. CPI MP and AITUC General Secretary Gurudas Dasgupta, however, maintains that problems surfaced the moment the company got to know the workers were forming an union. Honda’s Vishwanath’s reply to that is that though the employees had formed an union, it hadn’t been ‘‘brought to our notice and hence was not recognised’’.

‘‘The brewing discontent among employees soon had a cascading effect on our workers as well. The reason being that most of the workers stay together in one locality and are often supplied by the same contractors,’’ notes Autofit’s Deputy Manager S.K. Sharma.

Most firms have to make do with getting in more people on temporary ad-hoc basis to ensure that work does not come to a standstill. Autofit today has decided to set up a round-the-clock Help Desk and Grievance Cell to listen to its workers complaints.

(With reports from Pragya Singh)