Unionism hurting worker interests

A business that treats its employees well enough does not require a union at the helm. A company that leads with great set of values and brings its old legacy and culture into its work processes need not thrive under the influence of a union leader.

Having said that, whether one likes or not, labour unions today are part of large organisations? workforce and us as corporates cannot deny their involvement in manufacturing processes.

We have, however, more often than not seen that the creation of a union leads to several unpleasant outcomes. In the automobile industry, for instance, many untoward incidents have taken place resulting in deaths and brutal injuries to company employees at various levels during strikes and lock-outs in the plants.

Last year, close to hundred executives including expatriates were injured and hospitalised by an eruption of violence at an automobile major?s factory premises where one company executive was brutally killed.

Corporates should not let such unionism flourish and witness a day like what happened at the automobile major. Any such industrial unrest is a national loss which leads to lesser revenues and job losses to the economy as a whole. Trade unions are normally aligned to political parties and vested interests play a major role in influencing strikes at the plant.

Trade unions, meant for the benefit of workers, may eventually turn out to hurt worker interests rather than protect them in the long-term by propagating external political forces into organisations? day-to-day affairs?thereby disrupting company values and work culture. The trade union leaders are known to influence young, honest and hard-working labourers into politics promising job security and higher wages.

Union leaders, in the process of ensuring higher wages for some labourers, may lead to unemployment of many others since any company cannot control its total annual employee remuneration beyond a point.

India may lose its cost-competitive advantage as a whole, in case, there is a production loss to a company and labourers do not conform to a set of wage limits set by companies resulting in subsequent job losses and loss in revenues.

In today?s competitive times, the bottom line is that if labourers work hard enough, they will themselves reach the success path without any union who promises salary hikes. Being part of a union also leads to a casualness in work culture and forces some labourers to adopt a laid-back attitude for the sake of being part of a labour union.

God forbid, if one day a corporate were to shed off extra workforce in the wake of a slowdown, it would be these very lesser productive employees who will have to bear the brunt.

Unions are capable of raising or reducing output in factories, which may not augur well for a consumer goods company that is faced with high demand. On the other hand, non-unionism ensures that the production is done according to the call of the management which is directly related to prevailing market conditions. The best option is to have company-specific employee welfare unions to protect the interests of both employers and employees. These employee welfare unions can have dispute resolution committees which can meet at regular intervals and resolve issues through constructive dialogue.

The fact is that today most workers who are part of the automobile industry want a peaceful working environment and are looking for inclusive career growth. They want a stress-free work atmosphere and hardly have any time to devote to unionism and politics. Most skilled labourers today are more educated and are wary of external third-parties trying to influence them.

Therefore, the need of the hour is flexible labour reforms. India needs to formulate and implement fresh labour laws and regulations for all types of industries. Labour reforms have been pending for too long. India?s labour market is over-regulated and rigid labour laws are hurting the country?s growth. If we create a proper environment, more skilled labour will come to the fore and so will the demand rise for these workers.

Yet political parties with strong trade unions are always on the prowl for influencing new labour recruits in factories.

The author is vice-president, GM India