The Contracts of Exploitation

The Contracts of Exploitation

Interviews of workers which I conducted recently made me conclude that the Society has issued the ‘Contract of Exploitation’ to all. Exploitation of labour is not a new subject to anybody. I had earlier interviewed ten young persons who worked as trainees and published my blog ‘Training to Exploit.

I was discussing this subject with Arvind Shrouti. He advises more than a hundred unions in Pune area. Arvind mentioned that the extent of exploitation of labour was seen to be believed. The HR professionals, Union leaders, entrepreneurs and Government officials alike are not even aware of the ground realities, he said. I decided to investigate with his help.

Six young men met me. They worked at Hyundai Construction Equipment India Pvt. Ltd. Some worked through contractor, while others through NEEM. All were removed from service. None of them worked directly, that is to say, none of them was a permanent employee.

Very distraught and stressed they appeared. I introduced myself. Small talk between us helped them relax. They smiled and they said they trusted me. Obviously they were spoken to about me earlier. It served my purpose. I initiated discussion about their job.

“Saheb, we work as welders. At Hyundai Construction. But all of us have been removed from our job.”


“Yes, all six of us.”

“Where did you learn the skill?”

“We enrolled at YIT.”

YIT or Yashaswi Institute of Technology launched a scheme of ‘Learn & Earn.’ This scheme was reportedly supported by an ex-Minister in the Govt of Maharashtra. ‘Learn & Earn’ caught of the imagination of employers because it fulfilled their need – to have ‘flexibility’ in manpower. The Contract Labour Law makes the employers vulnerable to the demand of permanency of job, or the threat of abolition of contract labour in a process by the Government. YIT positioned its scheme such that the persons working will be categorised as ‘Trainees’ and that too for three years. This period was later increased to four years. The payment is [or was then] Rs 8500 pm in the first year which increases by a thousand rupees every year. On its face, this scheme looks innocuous, but it allows gross exploitation. YIT gives a Diploma in Mech Engineering and other Diplomas as well. I was told that the Diploma was issued by Yashwantrao Chavan Open University, but the University no longer gives it for YIT ‘trainees’.

“What’s your name?” I asked a middle aged person.

“Rajendra Vighe”

“And your age?”

“I am thirty-seven now.”

“When did you come to Pune?”

“When I was about twenty, Saheb.”

“So seventeen years ago?”

He had come to Pune in search of job. Seventeen years ago, in 2000 or 2001. Initially he took up a job at Kinetic Engineering as Apprentice Welder, worked there for a year and then returned to his village.

Rajendra is the eldest son of his parents, and has responsibility to support them too. He returned to Pune four or five years later.

“Where were you employed?”

“At Tata Motors. I did three periods there.” Rajendra took out his service certificate from his bag.

‘Period’ is a term quite commonly used to denote a period of seven months. Tata Motors employs temporary workers for seven months and then terminates their service. They are re-employed later for another term of seven months.

Why seven months? It means 210 days. This is to ensure that they are not employed for 240 days – if you do, you have to pay retrenchment compensation. All employers fear that if they employ a worker for 240 days he can justify the demand for permanent job. This is quite a common practice in manufacturing industry. Though very exploitative, it is common and unchallenged. It can be challenged in the court of law, but nobody does it. Not even the unions.

“So you worked at Tata Motors for 21 months?”

“Yes. Then I enrolled at YIT for Diploma in Mech Engg.”

“It is a three years course, right? Where were you placed?”

“At Hyundai Construction Equipment”

“What work did you do?”


“Did you complete the Diploma in Mech Engg course?”

“I completed all the six terms [three years] successfully, and qualified for the Diploma, but they did not give me Diploma.”


“They extended the course by one year and made it a four year course. I was paid a salary of Rs 10,500 in the third year, but they [YIT] placed me at Sigma Company on a salary of Rs 5,000 pm. I told them that it was impossible to make a living for a family in that salary.”

The Diploma recognition of YIT was withdrawn by Yashawantrao Chavan Open University in 2012 or 2013. Was the ploy of extending course by one year thought of to avoid granting Diplomas? The six workers thought so.

“So what did you do?”

“Ten days later they called me and asked me to work with TeamLease. I was then appointed by TeamLease to work at Hyundai Construction. It was under NEEM. I worked there for two years.” Rajendra produced his pay slip.

TeamLease is a well-known staffing company. This is what it says on its website. [Excerpt]

TeamLease Services established in 2002, is one of India’s leading human resource service companies in the organized segment. A Fortune 500 company listed on both NSE & BSE markets, with eight offices and 1400 clients across the country. A one-stop provider of human resources services to various industries and diverse functional roles, offering staffing, payroll processing, recruitment, compliance and training services. 

The company in partnership with the Government of Gujarat, set up TeamLease Skills University (TLSU), India’s first vocational university, at Vadodara. In FY2015, TeamLease rolled out NETAP (National Employability through Apprenticeship Program) to provide on-the-job training to apprentices. The company at present has about 125,000 associates/ trainees spread across the country and have till date given employment to 1.2 million people with an aim to hire millions more.

The pay slip shows that TeamLease of Gujarat had hired Rajendra. The place of work remained Hyundai, since TeamLease engaged him for Hyundai. It was a two year contract. This was a contract for NEEM trainee. TeamLease is a NEEM Contractor.

NEEM of National Employability Enhancement Mission is perhaps the most exploitative scheme ever launched officially by any Government in the world. I had blogged about NEEM:

The scheme is, like all schemes are, noble in its intention. A Neem Agent is required to be registered. A Neem Agent then can place a trainee [up to 10 Thousand] in industry. Who can they be? Read this:

A person who has completed graduation / diploma or a person pursuing studies leading to graduation / Diploma and registered under NEEM is called a Trainee under NEEM

A person seeking training under NEEM shall be at least 18 years of age and not more than 35 years of age as on the date of registration. [Note the outer limit!]

A person seeking training under NEEM may be either pursuing his or her graduation / diploma in any technical or nontechnical stream or may have discontinued studies of degree or diploma course

This has been interpreted by some to mean that even MBAs [typically from resource-starved institutes] can be engaged as trainees. Actually the definition allows practically anybody to be engaged as a trainee. The duration can be 24 months.

TeamLease repeatedly raises its voice against the archaic labour laws, and actively campaigns for change. The Contract Labour Act and The Industrial Disputes Act forces them to find circuitous routes to be in the ‘Temps’ business. Their anxiety for reforming labour laws stems from these concerns. Take a look at this is report in The EcoTimes:

‘In order to boost job creation process, the government should overhaul the “most regressive” labour laws in India, a TeamLease report says.’…..

…..”Our labour laws have remained dysfunctional, disharmonised, protracted and overreaching. This multiplicity of rules and procedural delays impose unreasonable legislations and transaction cost on businesses,” TeamLease Services Vice President Sonal Arora said.

[Overhaul of regressive labour laws essential: TeamLease report, The Economic Times, July 4, 2017 ]

“My service was terminated after two years. The Hyundai people then asked me to work with BSA.”

“What’s BSA?”

“Another contractor. They employed me for six months and then terminated my service in June this year.”


“They said there is no work, but actually there is more work now and they are also recruiting.”

“What was your last drawn salary at TeamLease?”

“Rs 15500. But at BSA they paid me Rs 11,000/-.”

“Were you covered under Provident Fund?”

“Nowhere. Because I was a trainee everywhere!”

“Hmmm…. Can you manage the expenses in eleven thousand rupees?”

Long silence followed this question. Rajendra shook his head. “What to do?” he said helplessly. “Sir, I also have to send some money for my parents. Their recent illness cost me a good chunk of money.”

“Does your family stay with you in Pune?”

“Yes, Sir. My wife and two kids. Son studies in the sixth, and my daughter in the third standard. I am thirty-seven now, Saheb. How to live here?”

Rajendra began his career as a YIT trainee. Anybody can see the façade of YIT. And NEEM serves as official vehicle of exploitation. [See my blog: NEEM does not redeem confidence]. In the last seventeen years his salary moved not just up but down as well in the range of Rs 8,500 to Rs 15,500 pm. And the last salary at Rs. 11,000/- ! Everywhere without social security benefit. That’s the ‘magic’ of working under NEEM contractor, TeamLease and YIT.

Watch Rajendra’s interview [Marathi] here.

A Bird’s Eye View of the Situation

Option Positive conducted a study of 113 establishments in Chakan, Ranjangaon, Pimpri-Chinchwad, Baramati region, covering all major industries. Here are some findings:

Out of the 1,03,882 workers employed in 113 organisations, workers in permanent employment were 39,125 [37.66%], Contract workers were 40,423 [38.91%], workers in temporary were 14,110 [13.58%] and Trainees are 10,224 [9.84%]. In other words, the ratio of permanent to ‘flexible’ manpower was approximately 38:62 or 1:1.63. In other words, for every two permanent workers, three ‘flexible’ manpower is employed. Their fate is no different from Rajendra Vighe’s!

Guess what is happening at the national level.

Average wage of permanent workers was Rs. 33688, while contract workers were paid on an average @ Rs. 9561/- p.m. The temporary and trainee workers were paid Rs. 8545 and Rs. 8780 per month respectively.

A permanent worker get three and a one half times the wages of a contract workman while he gets almost four times the wages of a trainee who does the same job in many cases.

Is that fair? The law says that the contract worker should be paid the same as a permanent worker if on the same job, but see the stark reality.

The Contract of Exploitation

Who is exploiting workers? Obviously the employers, or rather unscrupulous employers. The Government joins this gang rape by launching schemes like NEEM. Unions have no teeth, they do not even feel the pangs of conscience. They are onlookers in some cases. And passive conspirators in others. I have reliably learnt that in one of the MNC in Pune, four hundred ‘flexible manpower’ is employed supporting six hundred permanent workers. And out of the four hundred, one hundred and fifty are engaged under NEEM through contractors like TeamLease. All this with the knowledge and tacit connivance of the union!

Santosh Kanase is the new President of the Shramik Ekta Mahasangh. The Mahasangh is affiliated to IndustriAll which is a global union. They have a strong base in Pune. More than 100 unions are said to be affiliated to it. I asked Kanase what he plans to do to address this problem of gross exploitation.

“We will soon move the Court” he said.

“Unions move the court only as the last resort, when everything fails” I said, “You are beginning there!”

“What to do? Unions are powerless. Taking up cudgels on behalf of contract labour and trainees is not on their agenda. Even collecting statistics becomes difficult! However I am determined to take up their cause.”

There is an inferno in the minds of the young men. There are deep feelings of helplessness and frustration. The workers feel that all factors are loaded against them.

The exploitation journey is smooth and unchecked so far, but it could be strewn with landmines ahead.


P S:  A friend asked me this question after reading this story: “A man is available for exploitation. Does that mean we should exploit him?”

Vivek S Patwardhan