Comments on: More On ‘Is Bombay Dyeing Dying?’ https://vivekvsp.com/2015/02/more-on-is-bombay-dyeing-dying/ The Events in Human Resources and Employee Relations space, and in My World through my eyes. Wed, 29 Jun 2016 12:26:29 +0000 hourly 1 By: Salil Chinchore https://vivekvsp.com/2015/02/more-on-is-bombay-dyeing-dying/#comment-3516 Sun, 08 Feb 2015 17:35:57 +0000 https://vivekvsp.com/2015/02/more-on-is-bombay-dyeing-dying/#comment-3516 Your blog as usual is very informative, has picked up relevant issue of compliance and fairness.
However, one risk in discussing such matters is readers rush into conclusions such as who is the culprit and then who is the victim. If we peel the first few layers, few more dimensions emerge.
To begin with, let us do a WHY-WHY analysis..!
• Why do companies in India prefer to have contract labor heavy manpower model?
• Why do companies want to employ trainees, apprentices (fixed term employees) in place of permanent workmen?
• Why are companies opting for increased outsourced manufacturing instead of doing everything in-house?
This will help us understand other side of the Raymond story, which is so typical for any Indian manufacturing company.
A lot has changed in last 10 years in terms of pace of innovation, technology changes, globalized supply chain, breaking of foreign trade etc. Since most of the manufacturing in India is labor intensive, it has greater bearing on factories and workers. So, how much has labor regulatory environment changed in last 10 years to enable Indian industry and the workforce? Nil.
Here are some real-life examples of this generation factories:
• Products with short and / or unpredictable life cycle (e.g. mobile phones). One year you are expanding lines by 100%, next year you are discontinuing lines to cut down inventory.
• Highly export dependent businesses – some slowdown in US/UK and they discontinue orders to India without any advance notice.
• Deflationary market where companies have to guarantee YoY price reductions (e.g. Electronics, Automotive). So, how can labor costs stay flat or even reduce through various means?
• Competing with China and Korea: Indian counterparts are asked to give cheaper and yet better quality products.
• Studies have indicated the miserable plight of workmen who have taken VRS from the factories. Monetary packages, however hefty have vanished in no time – leaving workmen in lurch.
Against this backdrop, here are demands of the Indian labor and trade unions:
• No contract labor
• If not possible, contract labor paid similar wages as permanent labor
• Life time employment guarantee. Don’t touch anyone
• No production, fine, but no layoff
• Guaranteed wage increases
• Training – we will attend but pay overtime or other incentives for it

This means, we will have to look at the entire labor canvas with completely new lens. Marrying the labor interests with new realities of the industry is the key.
• Flexibility of the employer to organize his operations as per business requirement. Layoff is normal.
• Safety net for employees till they find new jobs
• Trade Certifications so that employee skills are marketable
• Allowing non-core employees but ensuring that they are paid fair, having a nation-wide policy
• Programs to make unions as business partners and not just institution of opposition
• More powers to the government to mediate and settle disputes proactively rather than decade long battles.

Till such changes are brought about, every Raymonds will be pointed as culprit.

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