On Toyota

INTRODUCTION
Toyota Motor Corporation, the worlds 2nd.largest automobile manufacturer, had entered into the Indian Market in 1997 through a joint venture with Kirloskar Group. The new entity was called Kirloskar Motor Private Limited (TKM). TKM established its manufacturing facility at Bidadi near Bangalore in the Indian state of Karnataka. The case deals with the labour unrest in Bidadi plant . On January 8,2006 .the workers of the plant went on strike,which was followed by a lock-out of the company.The conciliation process failed to resolve the dispute. Hence the government in order to maintain its investor-friendly image, prohibited the strike
On receiving the news,the company lifted the lock-out,but placed a condition that workers resuming duty will have to sign a good conduct declaration.
The declaration stated that the workers would henceforth maintain discipline in the plant and ensure full production. The union agreed to call off the strike ,but declined to sign the declaration. The company however strictly mentioned that if the workers did not sign the declaration, they would not be allowed to enter the plant. According to the union representatives, if both the parties remained rigid on their stands it would again lead to lock-out.TKM management was in a dilemma over handling the situation.
The case discusses in detail, the dispute between TKM management and the workers union and the development with respect to it.
LABOUR RELATIONS AT TKM

Prior to strike and lockout in January 2006, the plant has experienced 3 other strikes. 1st Strike-April 2001,went on for 2 days 2nd Strike-June 2001 3rd Strike-January 2002,followed by a lock-out(both went for 53 days)
In 2002 the company decided to call the workers in 2 shifts to meet the increased workers demand for the company. 1st shift:8 a.m-4 p.m 2nd.shift:8 p.m-4 a.m Workers were asked for overtime between 4 p.m -8 p.m and 4 a.m-8 a.m TKM wanted its workers to conform to Toyota Production System(TPS) In TPS the JIT is followed to respond to the changing demand. Based on Toyotas standard, TKMS plant was supposed to one vehicle in every 4.5 minutes.
TKM send its employees to Toyota plants located in Japan .Indonesia and Thailand to attend training.
Toyota also assigned master trainers from these plants to the Indian plant to ensure 100% implementation of TPS. 75% of TKM workers aged between 20-25 years refused to work overtime despite it being mandatory by the management. Workers of TKM demanded them to allow them form a trade union, but opposed by the TKM management. Workers however decided to go ahead and TKMEU was born. Management of TKM dismissed 2 office bearers of TKMEU on the ground of bad performance as per Toyotas global human resource policy. January 2002:Protesting against the shift system and dismissal of the workers,the employees went on strike and TKM had to declare alock-out(went for 53 days)
Company changed the shift system and hike salaries. The matter of dismissal of workers was still pending before the industrial tribunal of 2006.
February 2004:The TKM management suspended 15 workers.

2005-TKMEU was affiliated to CITU .The rift between TKMS management and workers intensified. TKM finally recognized only TKMEU but not its affiliation to CITU. The management agreed to hike salaries by 15%, to avoid another row with workers.
THE DISPUTE
On 5th Jan 2006-3 workers dismissed out of 15 that had been suspended in February. Reasons-They had been guilty of misconduct which include violent behaviour, disruption of work and assault on a supervisor.
TKMEUS STATEMENT:
The workers began their strike on January 6,2006. Heavy workload and unfavourable working conditions. 3 workers were forced to work. Workers suffered from spinal cord problems and respiratory problems. Management failed to provide safety equipment to protect workers against pain and dust. No proper and fair investigation conducted by management to before dismissal of 3 workers.
15 workers who had been suspended includes: 2 office bearers. 4 executive committee members. Remaining 9 were active members of union.
Reasons for suspension Not participating in 5 mins.warm up exercises before work. Wages were cut if they talk to their co-workers.
TKMEUS MANAGEMENT STATEMENT

Described TKMEUS allegations as baseless. Complete job security. Well established safety and health guidelines. Jobs at plant had been well analyzed. Safety committee once a month to review and take corrective measures in case there were any accidents and injuries.
THE NEGOTIATIONS
On Jan.9,2006,representatives of TKM and TKMEU were asked to present their case before the office of the Deputy Labor Commissioner at the conciliatory. TKM representatives were not present. Reason-Workers were protesting and raising slogans against the management in front of the DLC office. DLC decided to call for a meeting on January 12,2006.
The dismissal order for 3 employees should be kept in abeyance until the industrial tribunal gave its judgement. The lock-out should be lifted. No disciplinary action should be taken against the protesting workers. The workers should withdraw the strike in order to maintain a peaceful work atmosphere.
THE DISPUTE CONTINUES

On January 20,2006,TKMS management announced the local newspaper that it would lift the lock-out. The management announced that the lockout would be lifted from January 21,2006 onwards. TKM also pointed out that the advertisement did not contain any statement about whether the management had accepted their demand for keeping the dismissal of 3 employees in abeyance.
On January 21,2006 ,the government of Karnataka banned the strike by TKM workers and referred the matter to the third adittional labour court. On January 22,2006 local newspaper reported that about 60 workers resumed work on the first of the lockout being lifted. On January 23,2006 after a union meeting, the TKMEU announced that it was withdrawing its strike which declared that they will not tender any good conduct under taking as insisted by the management.
The management said that it wanted the workers that they did not indulge in destructive activities. On January 24,2006, TKMS workers and management entered into talks. The union sought removal of the lockout clause from the undertaking, which stated that the strike is illegal and that the management would take disciplinary action in case of the occurrence of such incident in future. The management accepted the proposal made by the union and decided to remove the clause.
THE RESULT
TKM did not face any major problem due to the strike of the workers and lockout at its plant. The production was carried by those employees who are not part of trade union. Analyst felt that the growing political disturbances in the state were affecting industry and society. Analyst opined that the world would lead to a loss.
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On Toyota

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On Toyota

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INTRODUCTION

LABOUR RELATIONS AT TKM

February 2004:The TKM management suspended 15 workers.

TKMEUS MANAGEMENT STATEMENT

THE DISPUTE CONTINUES

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