Need flexibility in labour laws for temporary workers: Maruti Suzuki

Written by Press Trust of India | New Delhi | Updated: Aug 29 2014, 20:07pm hrs
Maruti SuzukiCurrently, MSI has a total of around 19,000 workers, out of which 12,500 are regular and 6,500 are temporary. It also has around 1,100 apprentices. (Reuters)
Calling for practical reforms in labour laws, Maruti Suzuki India Chairman R C Bhargava says policy must allow employment of temporary workers in such a manner that the last to be hired becomes the first to be laid off during downturn but they must be paid subsistence wage.

The company, which is looking at 25-30 per cent of its total workforce to be temporary workers to provide flexibility during downturn, is already applying the last-come-first-go principle at its factories.

"The temporary workers whom we have recruited are exactly in the same manner, including the basic qualifications and then their training, for the regular worker. When there is a downturn, the guy who came in last is the first to be laid off, there is no pick and choose," Bhargava told PTI in an interview.

He further said: "When demand picks up, we shall take back the last guy who was laid off, the last is the first to come back and when vacancies arrive because we expand or people retire whatever happens, only from these temporary workers we keep getting them permanent."

On the overall policy, Bhargava said: "The labour law reforms I would like is a labour policy for recruitment on these line of having temporary workers and all these on the lines of last-come-first-go kind of things; that all permanent workers come from these temporary workers and a provision of subsistence."

Stressing on the need for providing assistance to laid-off temporary workers, he said: "When these people are laid off because of a downturn, there should be some mechanism by which they are given part of their wages at subsistence rate."

On the significance of having temporary workers, he said a certain percentage of the total workforce need to be non-permanent to cater for the fluctuations and demands in the auto industry.

"It's not steady production year round and year-to-year. You have seen the fluctuations. So if you have all permanent, then during the period production fell because of market condition, you would have a big problem because there would be people sitting idle doing nothing," Bhargava said.

He added: "So our idea is that you have temporary workers which may be 25 to 30 per cent of the total work force. They would provide the flexibility."

Currently, MSI has a total of around 19,000 workers, out of which 12,500 are regular and 6,500 are temporary. It also has around 1,100 apprentices.

The company had done away with hiring of casual workers through contractors in the wake of Manesar plant violence in 2012 and has directly recruited workers on temporary basis.

When asked about the current policy of requiring government nod to shutdown plant, he said: "Why should government approval is required if you have to close down a plant..My primary issue is why do you need government approval to shutdown a unit.

"If you find that you cannot run the business and want to get out of this, get out and you provide for a compensation to the people whom you are laying off because you are closing a unit."

He also said such a situation creates an awkward political situation for the government.

"How can an elected government say yes I approve your throwing the workers out... It's very difficult, it's not fair on them. How can they do it" Bhargava said.