FIR Group Project FinalReport

8/10/2019 FIR Group Project FinalReport

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Industrial Relations

1

Permanent woes of temporary workers:

Tata Motors Limited, Jamshedpur

Submitted by,

Anjan Kumar Mahapatra - H14077

Anuj Venkatrao Deshmukh - H14079

Keerthilakshmi B R - H14091

Monika Girdhar - H14097

Rohan Jha - H14107

Tushar Prabhakar - H14121


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ACKNOWLEDGEMENT

We owe a debt of gratitude to all those who have helped us in completing the case

study.

Firstly we would like to thank Prof. Pranabesh Ray for giving us this opportunity to

work on the case study. His support and guidance has helped us to bring the project

towards its successful completion.

We would also like to extend our thanks to all the officials from the management,

the office bearers of the union and the workers for giving us their invaluable inputs

about the case. They helped us at every step of the case and this study would not

have been possible without their contributions. We would like to thank them all for

their time and support.

Lastly we would like to thank Tata Motors, Jamshedpur plant for giving us the

opportunity to pick up this case, for sharing information with us and for providing us

with all the support and data we needed. The project couldnt have been a success

without them.


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TABLE OF CONTENTS

Sr. No Content Page No

1. Case Description 4

2. Analysis 8

3. Appendix A 11

4. Appendix B 14

5. Appendix C 17

6. Case Pictures 18


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CASE DESCRIPTION

Feb 12, 2009 6:30 PM

Tata Motors plant, Jamshedpur.

Young Arpan looked at his assembly line station with pride. Pride because his father

had worked at the same plant. He perhaps considered this job to be his inheritance

from his father. His family was thoroughbred TATA. Recently married, he and his

wife were planning a family vacation together along with their young son, wondering

if the TATA legacy would continue with the next generation. His mind was filled with

thoughts of the future, but to build it he must act now.

As any other usual day at work, he was working under the chassis number 102468

fixing a radiator. Little did he realize that this was the last chassis he was ever going

to work on. Not realizing that Arpan was lying down, the driver of the chassis,

numbered 102486, reversed his vehicle. This small negligence on part of the driver

crushed Arpans upper half of the body.

Feb 12, 2009 6:30 PM

Balwinder saw the truck behind Arpan move. The realization that Arpan was going to

be crushed by this moving line came a bit too late. He shouted out to Arpan but the

sickening sound of crushed bones reached his ears over the noise of the assembly

line. Shocked, he and other workers rushed to the spot of the incident.

Feb 12, 2009 9:00 PM

Scene of the incident at the Hospital

Mr. Chandrabhan Prasad and Mr. Sumant Sinha (DGM IR) rushes to the hospital

subsequently as the workers present on the shop floor rush Arpan to the hospital.

He is badly injured, unconscious but still breathing. As the news about the accident

spread, Arpan's relatives arrived at the scene. His Uncle, a long time Tata employee

had strong political affiliations with BJP and Chandrabhan wiped his brow thinking of

the consequences of a political angle to this issue right now. Although Chandrabhan

is angry that a minor safety flaw resulted in a ghastly incident, he knows that theonly way to salvage the situation is by engaging the management constructively and

not through any kind of agitation. But his Uncle was surprisingly calm, albeit

distraught. His uncle showed enough maturity of not allowing any political angle to

creep into the incident.

Feb 12, 2009 9:15PM

Meanwhile, Arpan passes away at 9:15 PM, but this news is kept secret among thefew present at the hospital, so as to prevent the crowd from getting more agitated.


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His family is still kept in the dark about his death. At this time Chandrabhan discusses

the situation with Sumant, takes out his mobile and calls Borwankar. Borwankar, by

this time is still in his office and is shocked to hear about the death of Arpan. He

informs Chandrabhan that Arpans family will get the requisite benefits and the TML

management shall cover all funeral expenses.

Feb 12, 2009 10:00 PM

The tension between the management and the protesting crowd has reached boiling

point, the crowd is refusing to back down. They demand that Arpans wife be given

the status of a permanent worker and that the required statutory benefits be

extended to his family. To quell the growing anger, the union decides to give the

management a deadline of 10:00 am next day by which time they demanded a

written confirmation-promising fulfillment of the demands. Chandrabhan has

reiterated this demand over phone to Mr. Borwankar .The management conceded to

some demands, they agree to give Arpan's wife the needed benefits and the'seniority of a permanent worker' but decline the demand for the status of

permanent worker. Mr. Chandrabhan Prasad is upset and continues to rally for their

original demands.

Feb 13, 2009 8:00 AM

Arpan's house

Mr. Chandrabhan Prasad and Mr. Satish Borwankar visited Arpan's family and

relatives at their house. The family had taken a new stance, demanding a writtendocument ratifying the agreement to fulfill their demands.

At this point Chandrabhan Prasad lost his temper, despite his most sincere efforts to

help Arpans family, he was being treated with mistrust. Though soon it was clear

that the motive behind this change was coming from Arpan's brother-in-law, who

(politically motivated) wanted the protest to continue and ask for more benefits and

changes for the workers conditions. Arpan's father and uncle intervened and

convinced Arpan's wife and family to have faith in the company given their long

association with it.

Despite the heavy involvement of the political parties, Arpan's uncle does not take

any drastic measures to try to make the management concede. Given his familyhistory with the company and the atmosphere, he decides to confine the situation to

simple discussion and debate.

Feb 13, 2009 9:30 am

The management addressed the gathering of workers and Union members. They

agreed to extend the benefits to Arpan's family and verbally confirmed that Arpans

wife will be given a permanent job in the company. At this point the General

Secretary of TELCO Workers Union, Mr. Chandrabhan Prasad intervened and

demanded a written confirmation from the management. Looking at the graveseriousness of the issue, the management deliberated on the issue of written


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confirmation immediately. Mr. Borwankar and Mr. Chandrabhan decide to hash out

the matter in a closed-door meeting.

Feb 13, 2009 10:00 am

Mr. Chandrabhan Prasad is now adamant that the management take an immediate

decision regarding the permanent status of Arpans wife. He is in a closed room

discussion with Mr. Satish Borwankar and asks him to confirm the permanent status

of Arpans wife at the very instant. As there were no legal provisions in the TML

policy in this case, this unprecedented demand couldnt be met from the side of

Mr. Borwankar without approval from the Bombay House. Mr. Borwankar conveys

this to Mr. Chandrabhan, who is no mood to relent. He then asks Mr. Borwankar to

call up Mr. P.M. Telang (Managing Director of TML). Seeing no way out

Mr. Borwankar calls up Mr. Telang, who by now has heard of the incident through

various official and unofficial sources.

After much persuasion and weighing of the pros and con's finally Mr. Telang decidesto concede to the demand of imparting permanent worker status and all the

relevant benefits to Arpan's wife. Given that she has all the necessary qualifications

required for the job, the management along with Mr. Telang, Mr. Borwankar were

convinced of their decision.

The plant manager Mr. Borwankar, Mr. Chandrabhan Prasad, workers and Arpan's

family gather at the site of the incident to hear out any other demands set forth by

Arpan's family.

Thereafter they decide to fulfill all these demands unconditionally, the family and

the gathering is sated and they return to their daily lives.

The company then proceeded to create said document within a day, and the matterat hand was resolved.

10th

April 2009

Arpan's wife was inducted into the company as an apprentice and given the

necessary training required. She already possessed the qualifications necessary and

thus is rapidly assimilated into the workforce without any hitches. She was, later on,

finally inducted as a permanent employee in the organization. Some semblance of

calm has now descended on her family and she can hope for a better future for

herself as well as her little boy.This incident was set as a precedent and later resulted in the landmark 2010 MOS

that conferred various benefits to temporary workers and took care of some of their

hitherto unmet needs.


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Later

The company decides to allocate a free budget for the purpose of ensuring worker

safety and for the purchase of safety equipment. DUPONT Consulting was hired for

advising on safety and systemic changes to eliminate the possibility of any such

incident happening in the future. All safety related issues hereafter were addressed

within a week.

Though the workers resisted the new changes for a long time (wearing extensive

safety equipment, banning of tobacco and alcohol on the premises) and the

management tried to quash this resistance through fines and punishment, in the end

the workers complied and the relationship was relatively harmonious.

The company also decided to cover all funeral expenses in future for all it's workers,

it was also decided that in case of the death of an employee, his position and its

benefits will be transferred to his wife, in case the wife passes away, their children

will receive the commensurate benefits.


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Analysis of the case as per the given facts

Union side

The Union took a mature step by deciding not to go for any mass agitations or

strikes. The issue was dealt by Mr. Chandrabhan Prasad with the utmost urgency and

subtlety. It was his prerogative to ensure that while the workers family received the

due benefits that they were entitled to and also he had to balance his relationship

with the management by not going overtly against them. He was instrumental in

bargaining on behalf of the workers wife and successfully getting her inducted as a

permanent worker in TML, post the incident. By being assertive in his demand with

the management side, Mr. Prasad did full justice to his post as the General Secretary

of the TML Workers Union

Management Side

It was a slight error of omission that the management had overlooked the fact of

benefits being conferred to the temporary workers on such an event. There was no

previous policy and the fact they were dithering on the issue of conferring

permanent status to the wife of the deceased employee, does not present the idea

that management being as proactive as the IR department of TML claims it to be. But

credit has to be given to Mr. Borwankar and the management in the area of

enhancing the safety features of the assembly line as well as the overall plant safety

and ensured that no stone was left unturned in incorporating safety features.

Moreover, post this case the management ensured that benefits to the temporary itwas set as a policy precedent and on the death or permanent total disability, the

settlement would govern the necessary steps in conferring benefits.

Analysis of Legal Implications and Practical Challenges

The terms regular and permanent are used interchangeably. The Model Standing

Orders (Schedule I) attached to the Industrial Employment (Standing Orders) (IESO)

Central Rules, 1946, defines a permanent worker as one who has been engaged on

a permanent basis and includes any person who has satisfactorily completed a

probationary period of three months in the same or another occupation in theindustrial establishment.. The term non-regular workers is used in this report to

include trainees, fixed-term employment workers, contract workers, temporary and

casual workers. The Central IESO Rules define a temporary worker as one who has

been engaged for work which is of an essentially temporary nature likely to be

finished within a limited period.

From legal point of view the major difference between Permanent staffing and

Temporary staffing is that in case of permanent staffing there is no fixed

employment period in the employment contract, only age of retirement is

mentioned whereas in case of Temporary staffing there is always a specifiedemployment period in the employment contract. Salaries and perquisites of the


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temporary workers are less than that of permanent workers at the same level, owing

to non-applicability of certain legal provisions as well as standard practices although

the safety and welfare benefits are mostly uniform.

Any union does not organize the temporary/ contract workers, but the union of the

regular workers represents their issues in the collective bargaining. There are several

structural obstacles and institutional challenges to organization of and collective

bargaining for non-regular workers, though their numbers are high and rising. It is

considered that, in fact, firms employ non-regular workers to avoid unionism. The

practice is to have the service of such workers only for a limited period in a year, but

continue them for years. It is also to be noted that the nature of relationship with

the employers in case of contract workers is indirect though in all other cases of non-

regular workers including temporary workers, it is direct.

There are numerous instances like in this case where non-regular workers, especially

casual, contract and temporary, have worked for years (sometimes more than adecade), but continue to fight for permanency even where union support is

available. Employment insecurity is the biggest obstacle to institutionalize

employment relations in the case of non-regular workers. The judiciary has not been

of much help in recent times; in fact, several adverse judgments have dented the

long-won employment rights, including the landmark ruling of the Honble Supreme

Court in the case of Secretary, State of Karnataka & Ors vs. Uma Devi & Ors in 2006

which held that, despite long and continuous years of service casual and temporary

workers employed without due selection process had not the right to be regularized

as they had made backdoor entries into jobs thus depriving other potential aspirants

seeking jobs of employment. On the brighter side, there are judicial precedentsupholding that irrespective of the status of an employee as a probationer or as a

temporary service/contract service, the compliance of the requirement under

Article 311(2)of the constitution for dismissal/ removal is absolute.

A comparative analysis has been provided as part of Appendix C to this report.

Analysis of the case from Human Aspect

Temporary or permanent, whatever be the case the fact of the matter is that a

worker is first a human being. The workers and management need to work hand inhand in order to ensure the company remains the leader in the market. Therefore, in

case of such incidents, the nature of a worker should not be given prime importance.

The priority should be given to amicable resolution of issues and proper benefits

imparted to the respective workers.

Keeping in mind this principle, the management at Tata Motors is known to be quite

considerate towards its workers, be it temporary or permanent. There have been

differences in terms of salary structure. But otherwise, most of the benefits are

extended towards both categories of workers. In the case under study, it has been

found that management went a step ahead and extended more benefits than thestatutory benefits stated in the MOS. In case of casualty, appropriate compensation


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is given to both types of workers as per the Workers Compensation Act. The

management took the opportunity to consider this case as a starting point for a

policy change. The new provisions included in the successive MOS highlight the

proactive measures taken by management to resolve such issues in future.

Temporary workers in Tata Motors are almost at par with the permanent workers in

terms of benefits received and the difference in the salary levels and the duration of

the working period. The temporary workers are all taken from a pool of employee

wards and are made permanent on the basis of the business cycles that the

company is going through. In periods of slowdown as few as 250 workers were made

permanent in a year, while as many as 750 workers were made permanent during

the periods of high demand, in a year. The policy of making temporary workers

permanent is based on a review of the business scenario and is a transparent

process. The policy of TML is to rotate the temporary workers from the pool, so that

each worker gets a chance to earn his livelihood. But even after all the measures put

in place, there is always a demand of the Union to make temporary workerspermanent at the earliest. In this case Arpan had served as a temporary for more

than 7-8 years, and was due to be permanent in a year or so, just before tragedy

struck. Hence the demands of the Union were even more vociferous regarding the

conversion of temporary workers to permanent. While this demand still continues to

be a bone of contention among workers and management, the landmark settlement

of 2010 has gone a long way in extending benefits to the temporary workers.


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APPENDIX ARelevant extracts from Tata Motors union document

Temporary worker definition

Under section 4 of the Employment of Labour (Standing Order) Act 1965 workers

have been classified as apprentices, badlis, casual, permanent, probationer and

temporary.

The term Temporary worker as defined in section 2(s) of the Employment of Labour

(Standing Orders) Act, 1965 means "worker" who has been engaged for work which

is essentially of a temporary nature and is likely to be finished within a limited

period.

Need for temporary workers in a firm

Keeping down administrative costs, remaining flexible and above all, retaining the

capacity to respond quickly to volatile demand are the three major reasons why

companies hire temps, according to a survey this year by the industry association,

the Indian Staffing Federation (ISF)

Relevant Excerpts from the MOS 2010-2013 of Tata Motors regarding Temporary

Employees

The MOS signed in 2010-turned out to be a landmark settlement. Several new

initiatives towards employee well-being and safety were introduced after the fatal

accident. Hence there was the introduction of new measures of safety and employee

well being as well as increasing employee productivity. In order to help the needy

workmen including temporaries and trainees to meet their medical expenses for self

and for family members, Medical Support scheme was introduced and agreed upon.

This was a contributory fund and managed through a joint committee. Referral of

dependant parents for specialized treatment to a hospital outside Jamshedpur was

agreed upon while overall limit of outside treatment was capped at 1,25,000/- INR

covering both parents.

Section 32

A temporary workman joining the temporary pool hereafter will during the period of

his/her temporary employment, be paid basic salary at the rate appropriate to

his/her grade in the revised scales and shall receive benefits to which he/she is

entitled as per this settlement


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Section 31

Safety and Environment

The Union and the company is committed to create a healthy and safe working

environment for all workmen in the plants and offices and in other establishments.

The company shall

a. Provide and maintain a safe plant and shall take appropriate measures to improve

quality of life of all workmen.

b. Train and supervise workmen with respect to safe working procedure and health

care.

c. Provide all information to workmen with respect to safe working procedure and

health care

d. Provide safety appliances.

e. Ensure implementation and compliance on statutory provisions of safety

iii. The Union will support the efforts of the company

a. To conduct periodical proficiency tests for workmen in critical trades having safety

implications such as crane drivers, bus or truck drivers, forklift operators, etc. Such

tests shall also include the specified medical examinations.

b. To impress upon the workmen the need to comply with Standard Operating

Practices, as any violation of this may put the safety of workman at stake

c. To ensure that workman do use safety appliances while working and do notindulge in short cuts or unsafe practices

d. To achieve zero Accident Plan

iv. Both company & Union agree to continuously work for minimizing the adverse

impact of our products, operations and services on the environment. For achieving

this objective, Union agrees to assist in implementation and maintenance systems

like ISO 14001, EMSs well as extending support in Companys various initiatives in

this direction including reduction in carbon footprint etc.

v. In line with our commitment to improve safety awareness and motivate workmen

towards creating a safe work culture, it was agreed to evolve a safety award scheme

vide MOS 2007.

Section 27

Workmenscompensation

i. Ex gratia payment for injury to workmen in certain cases: The workmen including

temporaries coming to their workplace o duty or returning from there after duty

hours are over, will be entitled to ex gratia payment on the lines of IOW benefits if


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they sustain injuries only in a road accident provided prescribed conditions are met

as per the norms of the company.

ii. If a workman (including temporary workmen) is medically unfit due to an accident

in course arising out of duty, he shall get full basic wages and dearness allowance as

IOW ( Injury on Works )/ IOD ( Injury on Duty ) from the date of accident till the

workman is declared fit by the Companys Medical Officer. The amoun t of basic

wages and dearness allowance so paid will not be adjusted against the

compensation payable under the Workmens compensation Act 1923.

The compensation during the period of disablement shall be paid on the basis of the

last wages drawn immediately before the workman met with an accident.

Provided that the employer shall not be so liable for extending such IOW/IOD

benefits in respect of any injury caused by accident which is directly attributable to

a.

Workman having been under the influence of drink or drugs, orb. B. The willful disobedience of the workman to order expressly given, or to a

rule expressly framed, for the purpose of securing the safety of workmen , or

the willful removal or disregard by the workman of any safety guard or other

device which he knew to have been provided for the purpose of securing the

safety of workmen.


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APPENDIX BCOMPANY PROFILETATA MOTORS LIMITED

Tata Motors Limited is Indias largest automobile company, with consolidated

revenues of INR 2,32,834 Crores (USD 38.9 billion) in 2013-14. It is the leader in

commercial vehicles in each segment, and among the top in passenger vehicles with

winning products in the compact, midsize car and utility vehicle segments. It is also

the world's fifth largest truck manufacturer and fourth largest bus manufacturer.

The Tata Motors Groups over 60,000 employees are guided by the mission to be

passionate in anticipating and providing the best vehicles and experiences that

excite our customers globally.''

Established in 1945, Tata Motors presence cuts across the length and breadth of

India. Over 8 million Tata vehicles ply on Indian roads, since the first rolled out in

1954. The companys manufacturing base in India is spread across Jamshedpur

(Jharkhand), Pune (Maharashtra), Lucknow (Uttar Pradesh), Pantnagar

(Uttarakhand), Sanand (Gujarat) and Dharwad (Karnataka). Following a strategic

alliance with Fiat in 2005, it has set up an industrial joint venture with Fiat Group

Automobiles at Ranjangaon (Maharashtra) to produce both Fiat and Tata cars and

Fiat powertrains. The companys dealership, sales, services and spare parts network

comprises over 6,600 touch points, across the world.

The foundation of the companys growth over the last 68 years is a deep

understanding of economic stimuli and customer needs, and the ability to translate

them into customer-desired offerings through leading edge R&D. With over 4,500

engineers, scientists and technicians the companys Engineering Research Centre,established in 1966, has enabled pioneering technologies and products. The

company today has R&D centres in Pune, Jamshedpur, Lucknow, Dharwad in India,

and in South Korea, Italy, Spain, and the UK.

Tata Motors is committed to improving the quality of life of communities by working

on four thrust areas employability, education, health and environment. The

activities touch the lives of more than a million citizens. The companys support on

education and employability is focused on youth and women. They range from

schools to technical education institutes to actual facilitation of income generation.

In health, the companys intervention is in both preventive and curative health car e.The goal of environment protection is achieved through tree plantation, conserving

water and creating new water bodies and, last but not the least, by introducing

appropriate technologies in vehicles and operations for constantly enhancing

environment care. With the foundation of its rich heritage, Tata Motors today is

etching a refulgent future.


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TELCO WORKERS UNION

In 1945, when India was on the threshold of independence , Tata Sons purchased

Singbhum Workshop from East Indian Railways at the cost of Rs 25,000,00/-. In the

repair workshop of railway wagons and locomotive engines, Tata sons management

planned to manufacture locomotive engines in order to fulfill the requirements ofthe Indian Railway & simultaneously develop infrastructure and trained workforce

which were essential for manufacturing steam loco boilers and road rollers at the

plant. Tata sons named this company as Tata Locomotive and Engineering Company

Ltd. (TELCO).

During the period 1946 to 1949 Indian national income was dependent on

agriculture. GDP from agriculture was 48.1% while industries contributed meager

8.3%. In 1948 national income was Rs 246/- per man, per year. In the midst of such

an alarming situation, Telco Workers Union came into existence under the

leadership of Mr. Michael John and Mr. Mela Singh. They adopted Gandhianphilosophy of national reconstruction to provide employment to the poor who were

dependent upon agriculture sector and other occupations like jute, tea and the

armed forces.

On 20th

August 1946, Telco Workers Union legally came into existence after its

registration under The Trade Union Act1926. The registration number was 98.

All workers of Singhbhum workshop were absorbed in the new setup. The total

workforce strength of the company that time was 625. Unions membership

subscription was 4 annas per month. On this subscription, union membership wasgiven and membership records were maintained in a register.

Shri Nripen Banerjee, Sardar Mela Singh, Shailesh Das, Mihir Bhattacharya and Shri

Rajen were first Office bearers and leaders of the Telco Workers Union. At that time

the only central trade union organization in the country was AITUC under the

leadership of Mr. V.V. Giri (Ex-President of India). Telco Workers Union initially got

affiliated with it. In 1947 when INTUC came into existence, Telco Workers Union

realigned with it. Almost all Unions functioning at Jamshedpur joined the INTUC

during 1947-48 and after prevalent democratic process Mr. Michael John was

elected as the President of the Union. A new saga of working class movement tookbirth in this leading engineering industry of the nation.

At Telco, Union and management believed in collaborative working and through

successive collective bargaining agreements, they improved the salary and other

service conditions of the workers with long term vision and at the same time, also

ensured the sustenance of the Company to remain a market leader.


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Structure of TELCO Workers Union

President

Working

President

General

Secretary

Vice

President

Asst.

Secretary

Vice

President

Vice

President

Vice

President

Vice

President

Vice

President

Asst.

Secretary

Asst.

Secretary

Asst.

Secretary

Asst.

Secretary

Asst.

Secretary

Asst.

Secretary

Asst.

Secretary

Deputy

President


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APPENDIX C Comparative analysis of temporary workers vis--vis

permanent workers

Particulars Permanent workers Temporary workers

Appointment Formal Often informalWork site Same workplace till in

employment

Different in some cases

Employer Same till in employment Changing as per the tenure

Employment tenure Open ended Work or time based in short

spurts

Employment security High but being

threatened

Low or nil

Training (skill security) High, human capital

returns can be reaped

Low or nil unless the

employer invests and

maintains the workersWages Collectively bargained

wages

Receives wages many times

lower than the regular works

Fringe benefits High Low or nil (bonus payment

not universal; struggle for

getting allowances, etc.)

Terms and conditions of

work

Collectively bargained or

legally stipulated

Some aspects legally

stipulated but poorly

implemented, but largely

unregulated

Social security Covered and enjoyed In some cases legally coveredbut largely in practice not

existent

Income security High Low or nil

Union organizational

coverage

Trade unions presence is

relatively significant

Poor union coverage

Collective bargaining

coverage

Low Virtually nil

Voice security Medium Low or nil

Safety and health at work

place

Strong law, union

monitoring-Medium

Less, though supported by

law in some casesNature of work Regular Often regular work but paid

lower wages; meant to be

engaged for periphery work


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CASE PICTURES1.

2.


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3.


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4.

Documents

FIR Group Project FinalReport