LG Electronics’ employee relations policy is under scrutiny. The LG employees resorted to strike and then resumed after ten days. This sounds like a familiar story. Nothing unusual one would say. If you dig deeper, it raises some questions.

Let us catch facts first:

LG workers formed a union and applied for registration in January 2016. That was supposed to be an ‘Employees Union.’ Let me quote the IndustriAll [IndustriAll is an international union] report places facts on table:

[I quote] On 9 July, 11 workers, including office bearers of the proposed union were denied entry to the factory, and management took their ID cards away. The workers were then informed that they were being transferred to different locations in distant parts of India including, Jammu Kashmir, Jharkhand and Bihar and asked to report to work in those places. A twelfth person received the transfer order a couple of days later. [Unquote]

So the workers struck work from July 11. Then police intervened by making some arrests. IndustriAll report says:

[I quote] Owing to the arrests and the fear of being attacked by hired goons, workers reached an agreement with management on 20 July and withdrew their protest. [Unquote]

The last para of the Industriall report makes categorical and serious allegation which is worth investigating. It says

[I quote] Workers at LG will now pursue the legal process for union registration and take forward their demands. “This is a typical union busting case in India. The LG management should know that these types of cheap tricks will damage the company image as they declare to protect employees’ basic labor/human rights and build a future-oriented “Win-Win Labor-Management Relations” in their CSR policy. Together with SMEFI, we stand with the LG workers’ struggle in India and will continue to support them.” said Kan Matsusaki, IndustriALL sectoral director for ICT, Electrical and Electronics. [Unquote]

So our next step is to investigate the Labour Policy of LG Electronics. This is where the story takes a very different turn because the actions of LG Electronics India P Ltd become difficult to understand in the light of the Global labour policy of LG. I have very often emphasised the need for organisations to declare Employee Relations Policy, and here is one such organisation declaring its policy on the website. The policy is laudable! Let us examine it before we think of this strike.

[I quote]

Labor Rights Protection

We protect employees’ basic labor/human rights and build a future-oriented “Win-Win Labor-Management Relations”.

LG Electronics strives to motivate employees by actively protecting their labor/human rights and to reduce risks associated with labor/human rights across its supply chain. We also run a grievance resolution process through multiple channels to promptly address any issues that employees face.

All employees are eligible to join and participate in the activities of labor unions, in accordance with the relevant collective bargaining agreements and labor union regulations. The union’s infrastructure consists of one head office and six branches in Korea. All union members have voting rights and are eligible to stand for office. In addition to the quarterly labor-management meeting and annual Collective bargaining, LGE communicates various issues, including working conditions, regularly through diverse channels. Both parties negotiate in good faith and with patience on important agendas to reach an agreement. LGE also operates the Junior Board to obtain suggestions from both union and non-union members. LGE further makes diverse efforts through various channels to promote effective communication.

LGE has spread the advanced labor-management culture and labor management know-how to overseas offices as a part of its ongoing efforts to form a global advanced labor-management culture. In addition, LGE is strengthening the global labor management network to monitor and evaluate the labor-management relationship in real-time and assign a Green, Yellow, or Red signal corresponding to the situation. [Unquote]

The news report also says that CITU leaders Brinda Karat, KM Tewari and others expressed solidarity with workers and they met the striking workers at the gate.

Later, the workers agreed to accept transfers to nearby places and that’s how the conflict was resolved, temporarily at least.

We would have expected the management of the company to make a statement. When asked they refused! “LG has no comments at this point of time,” the company said in response to an email. [See Livemint story]. Why no comment? What is there to hide? Would they not respond to those serious allegations of union busting? Is it not a contravention of their policy?

Now we have some facts, incontrovertible facts: First: Workers formed union. Second: They could not obtain registration for six months. [The State Governments all over the country are delaying registration inordinately, thereby stifling formation of unions. This is not the story of the Northern India, it is the same in Southern India. Please interpret the clarification of Tamil Nadu Government –that IT employees can form unions- in this context.]. Third: LG Electronics has an ‘evolved’ labour policy, but they transfer all union members to distant places. Fourth: LG Electronics chooses to remain silent, thereby preventing understanding of their side of the story. This also leads to the conclusion that they would have, in all probability, acted in ways not consonant with their global labour policy.

A workers’ strike is in full public view. The Company’s labour policy is also in full public view – it is on their website. The secrecy can only be damaging to LG.

MNCs are known to adopt different local policies, completely divergent with their declared global one. I had written about TESCO in my blog ‘The Two Faces of MNCs.’ Long and Short of the Story: TESCO adopted diametrically opposite labour policy in USA than the mature one which they practised in UK. Net result: conflicts and losses, and finally exit.

LG is the fourth largest ‘Chaebol.’ A chaebol is a family run organisation. These are marked by very authoritarian cultures. Perhaps it is getting manifested in India.

‘Make in India’ will succeed if the workers are not unfairly treated by refusal to register unions, by abusing State Machinery to suffocate them. Please recall that four years after the strike, several Maruti Suzuki workers are still languishing in the jail, with the State Government’s shameless partisan support to Maruti Suzuki.

With rampant discriminatory employment of contract workers, with Government machinery clearly apathetic in their stance, things might get difficult to handle when the discontent grows to unmanageable proportions. The LG workers’ struggle may appear inconsequential, but it could as well become the precipitating one. That significance of their struggle must be understood in this broader picture.

Vivek S Patwardhan