To improve work culture, Maruti Suzuki takes union leaders to Japan

Roudra Bhattacharya Posted online: Saturday, Dec 07, 2013 at 0000 hrs
New Delhi : In order to improve industrial relations after the violent labour disputes seen in 2011 and 2012, car market leader Maruti Suzuki is taking 15 members of its Gurgaon plant union on a week-long tour to parent Suzuki’s plants in Japan starting December 7. The knowledge is expected to help in more mature engagement between company management and union officials and avoid flare-ups in the future.

Top leaders of the Maruti Udyog Kamgar Union (MUKU) will meet senior Suzuki Motor Corporation officials across HR, production and corporate functions. It will also hold

meetings with two Suzuki worker unions in Japan, the first is a union of Suzuki workers at the car factories and a second a federation of unions across all Suzuki plants that include the motorcycle, marine and engine businesses.

Maruti Suzuki chairman RC Bhargava told FE, “It is part of educating the union on the Japanese way of doing things. They will study how work is done there, how discipline is maintained and they will also meet Suzuki chairman Osamu Suzuki”.

Added Kuldeep Janghu, general secretary of MUKU, who will be heading the entourage, “We want to understand their culture and improve industrial relations. We will also see how the union works there and and what problems they have. It is important to know their HR policies and wage settlement process. We want to learn and avoid problems that happened in 2011 and 2012. There must be better ways to deal with such confrontation, after all the Japanese workers have been doing this for a long time.”

The plan behind the tour, which is funded by the company, is to improve work culture and teach global best practices to its about 20,000 people strong Indian labour force at a time when Suzuki is increasingly relying on Maruti to take care of its emerging market operations. Maruti currently accounts for 25% of Suzuki’s global profits and about 40% of revenues.

The move by Maruti Suzuki, which has a 40% share of India’s 27 lakh unit passenger vehicle market, follows a spate of labour disputes faced by automakers across the country in the last few years. In 2013, itself, Honda Motorcycle, Hero MotoCorp, Mahindra and Bajaj Auto all faced worker related problems largely on higher wage demands. The problems were exacerbated by slowing market demand that is putting severe pressure on profitability.

Maruti itself has seen significant labour trouble. In 2011, its Manesar factory saw three strikes from June to October over demands for formation of a new union. Then in July 2012 a violent clash at the same plant claimed the life of a senior company HR official and injured almost 100 others. The Manesar plant had to be closed for a month, as the company fired 500 workers and decided to do away with contract workers at the facility.