case analysis mahindra and mahindra and nokia (Trade unions)

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SAKSHI SHARMA CASE ANALYSIS

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Trade unions

Transcript of case analysis mahindra and mahindra and nokia (Trade unions)

Page 1: case analysis mahindra and mahindra and nokia (Trade unions)

SAKSHI SHARMA

CASE ANALYSIS

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MAHINDRA AND MAHINDRANASHIK PLANT (IGATPURI)

• The plant employs around 4,000 workers and produces most of the M&M models such as the Xylo, Bolero, Quanto and Scorpio besides the mid-size sedan Verito.

• M&M has already incurred loss of production of around 500 vehicles so far. In terms of revenue loss, it is estimated to be around Rs 25 crore.

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ISSUE• The strike is a result of a fallout of the suspension of

two workmen on disciplinary grounds. • The hunger strike by the two senior union leaders,

who were demanding immediate signing of the wage accord by the company.

• One of the union leader was suspended.• The union is demanded inflation-linked wage

revision, besides restricting the wage agreement period to three years against the present three-and-a-half years.

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WHAT MANAGEMENT WANTED?

• The company wants the two leaders to end their hunger strike and then come for negotiations while the union leaders are firm on their stand that it should first sign the wage hike agreement, which it has been negotiating with the union for the past almost five months.

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NEGOTIATION

• The management wanted to increase production 25 per cent before considering the wage hike demand.

• Also, against the union’s proposal of a Rs 10,000 hike, the management’s offer is only Rs 6,400, which is even lower than the one proposed by the DLC. Labour department proposed increment of Rs 8,662.

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NOKIA SIEMENS

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• In August 2009, the workers at Nokia went on strike.

• According to a report, the strike started suddenly on 13th August 2009,after announcement of the new pay proposal with a salary hike of only Rs 200 per month.

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• The workers argued that this was equivalent to no hike in salary despite repeated requests.

• The workers’ union had initially demanded a hike in salary in 2008, which was not met.

• In 2009, citing problems caused by the recession, demands for wage hikes were also denied. The workers went on strike.

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• The strike effectively continued for only two days, but the production of 300,000 handsets was affected.

• There was a very quick response from the Labour Department pressuring the workers to stop the strike and give time to settle the dispute.

• On 14th August, management agreed to talk to the workers regarding their demands and also offered a salary hike of Rs 1400 per month.

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• It is also interesting to note that trade union wing of ruling DMK party the Labour Progressive Federation (LPF) had formed a trade union in- Nokia Workers’ Progressive Union, affiliated to LPF.

• Through those negotiations, a wage pact was finally signed between management and the LPF giving the workers a salary hike of Rs 1500 per month.

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AGAIN STRIKE IN 2010

• The strike lasted for three days and ended after assurance from the company that the suspended workers would be taken back.

JULY 2010• The management was in the process of finalizing a

long term wage settlement with the union, but a fraction of the workers were opposed to the proposed settlement. The demand was also to reinstate the suspended workers.

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JUNE 2013

• The employees backed by the CITU (Centre of Indian Trade Unions) went on strike on June 7 demanding union recognition, reinstatement of some suspended workers and wage hike.

• While the CITU claimed that about 120 employees were on strike, the company maintained only 60 stayed away from the work.

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• The contract included 700 workers in it.