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Corporate Legal Framework

Notes fitters and electricians. Accordingly, the company hired 400 workers mostly uneducated

and unskilled from nearby villages. Few of them were taken for the fitter and mechanic

positions. Apart from these, there were sixty staff members looking after the other support
functions. The workers were paid low wages and were employed on temporary basis at
the beginning and till 1986 most of them were not made permanent. The human resource
department was headed by R.C. Jain, who was an experienced professional and was with

the firm since its inception.
The Genesis

In 1986, the company ventured into floor tile manufacturing and set up another facility
at Rampur unit. This plant was semi-automatic as compared to the wall tile plant which

needed manual operations. The machinery of floor tiles unit was bought from Italy and
due to the nature of process some experienced workers were shifted from wall tile facility.
Slowly, two distinct groups of workers emerged based on the nature of their job and
subsequent skills required. First group was that of unskilled workers mostly associated
with manual operations and the second group was that of skilled workers looking after
technical operations. The second group was paid higher wages than the fi rst group. This
disparity led to discontentment among workers but in the absence of union, it never came

out as an organised reaction. The first such organised attempt was made by workers in
1988, but a prompt and harsh action from management aborted the workers’ bid to form
union. However, this event drew management’s attention towards workers’ grievances
and management helped workers to form a union in 1989. The union was named “Bhartiya
Crystallisation Mazdur Sangh”. However, since most of the workers barring few technical
ones were uneducated, they were unaware of roles and responsibilities of union.
The Management started negotiations with the newly formed union and the fi rst wage
settlement agreement was signed on January 19, 1990. In this agreement, though the
management agreed to increase wages to the extent of ` 250 per month, it linked wages
to production targets. After three months of this agreement, the union leader left the
organisation to join government service. The union was left leaderless. After some time
the workers started voicing their concern about the target-linked wages, but in the absence
of a leader their concerns could not get a voice. It was at this point that some external
labour leaders started inciting the workers. A gate meeting was organised to exploit the
situation on September 21, 1990. After this incident, the industrial relations situation further
worsened and led to a go-slow movement by workers in January 1991. This affected the
productivity of the plant severely. Due to the absence of union leadership, management

too, found it difficult to control the situation, since external leaders’ influence was very
much visible and company’s HR Manager R.C. Jain refused to talk to the outsiders.
He remained adamant and left the job in March 1991 and the go-slow by the workers
continued. In another development, the incumbent, HR Manager Arun Joshi, who took
over after Jain left converted variable DA to a fixed DA rate. Since, at that time infl ation

was spiralling and the rate of DA, elsewhere, was high, the workers refused to accept this
provision. Ultimately, under pressure from external leaders as well as workers of the fi rm,
Joshi withdrew the fixed DA and accepted the variable DA provision.

In the meantime, K. N. Trivedi took over as the unit head on May 5, 1991. Before joining this
plant, he had served the Indian Air Force for seventeen years and was a strict disciplinarian.
The organisational situation demanded quick action to stop go-slow because the company
had market share of forty per cent in both the tile categories and the demand for tiles
was still going up. The management did not want to lose a single day’s production. In a
calculated move, the management suspended thirty five workers who were on a go-slow.

This was for the first time that any worker was suspended from the plant which instilled a

sense of fear in the minds of the workers. As a result of this, workers started working and
the productivity of the plant started showing improvement. Contd...

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