What is the future of labor unions in India?
Joining a union in India may reduce the performance of an employee. There have been a recent set of incidents involving union workers vandalizing factories; however, despite these negative occurrences, unions have a role to play in India’s future. But it is important first to consider that unions have their downsides for employee job satisfaction and productivity.
As of late, trade unions have been engaging in aggressive collective bargaining tactics by staging strikes. The Indian Automotive Industry has seen strikes that have caused major slumps in performance and earnings.
For instance, Honda Motorcycle and Scooter India lost a total of Rs. 1.2 billion when 3,000 workers and supporters went on strike. Even Maruti Suzuki faced a fall in production capacity in 2012 due to trade union backed violence at one of their plants, which caused a temporary closure of the production facility; the company was only able to reach only 10% of its original production capacity after reopening of the plant.
There has also been a transformation of Indian society from a “society of subjects to that of citizens.” The modernization of the economy has brought with it advances in technology, organizational complexities, and an increase in economic interdependence.
Consequently, individual workers are expected to exhibit self-reliance, initiative and self management, instead of waiting for commands from bosses. The traditional culture of being ‘looked after’ has yielded place to one in which industrial labour wants to ‘look after’ itself.
Historically, in India, the function of the trade unions was limited largely to collective bargaining for economic considerations. However, trade unions now play a major role in employee welfare activities, cultural programs, medical facilities, and educating members of the trade union.
On the other hand, the managers have aimed to reduce labour costs, increase productivity, and prioritize quality of production, which is sometimes at odds with the objectives of the union.
When an employee has an allegiance to both his employer and his union, ‘dual commitment’ takes place. Dual commitment is defined as a psychological state that exists when a worker holds positive attachments to both employer and union. Unilateral commitment is attachment to a union or to an employer but not to both. As a result, union members tend to be less satisfied with their jobs due to their divided allegiance.
This is because unions and union leaders create a culture of discontent and pessimism where employees perceive more problems than opportunities related to their jobs. Furthermore, employees, who have low levels of job satisfaction, are more likely to join a union.
The Indian states of Kerala and West Bengal are experiencing particularly high degrees of job dissatisfaction. Overall, job-related outcomes of the employees appear to be negatively affected by the higher level of unionization.
Trade unions in India have come a long way, however, since the Madras Labour Union was formed in 1918. India now has more than 84,642 registered trade unions along with countless unregistered trade unions scattered across a large spectrum of industries. The potential for growth in trade union-represented workers is significant, given the fact that 64% of India’s population is expected to be working by the year 2021.
Many of the aforementioned negative events associated with union activity, however, are isolated, and many unions serve their purpose, while also allowing for the business to meet its objectives. Usually, trade unions can enable a healthy discussion between the workers and employer. Furthermore, trade unions in India have, over the period of time, ensured to provide a forum to facilitate better industrial relations and growth.
Sinha, Secretary of the Indian National Trade Union Congress (INTUC), was of the view that workers are still treated as commodities. However, as of late, employers and their associations started a consultation process with trade unions.
In the United Kingdom, few workers actually join trade unions, which are largely presented as out-of-date, obstructive, selfish, and a thing of the past.
But it is a surprising fact that Trades Union Congress (TUC) is the largest voluntary organizations in the country—much larger than say the National Trust. More than 100,000 trade union members volunteer for unpaid roles within their unions to help members on issues such as health and safety, training, equality, grievance and discipline. That is the “big society” in action without obstructing the industrial relations.
Unions in India should merge with the prevailing culture for a bright future.
Asif Iqbal is the president of the Indian Economic Trade Organization.