Is social partnership the way forward for Indian trade unions? Evidence from public services

• Date: 01 December 2017
• Published date: 01 December 2017
• Author: Vidu BADIGANNAVAR
• DOI: http://doi.org/10.1111/ilr.12028

International Labour Review, Vol. 156 (2017), No. 3–4

Copyright © The author 2017

Journal compilation © International Labour Organization 2017

* Aston Business School, Aston University, Birmingham, email: drb.vidyadhar@gmail.

com. The author gratefully acknowledges the funding for this research, which was provided by the

Nufeld Foundation (Grant No. 3732 5). He is also grateful to Mr G. Gawade from the International

Trade Union Congress (INTUC) and the late Mr A. Trivedi from the Confederation of Free Trade

Unions of India (CFTUI) for their assistance with this research.

Responsibility for opinions expressed in signed articles rests solely with their authors, and

publication does not constitute an endorsement by the ILO.

Is social partnership the way

forward for Indian trade unions?

Evidence from public services

Vidu BADIGANNAVAR*

Abstract. Since the start of economic reforms in 1991, India’s trade unions have

found themselves increasingly excluded from the political process and marginal-

ized in collective bargaining. Using survey and interview data from the Maharash-

tra afliates of two national union federations, this article examines whether social

partnership with employers is a viable option for Indian unions to regain inuence

and protect workers’ interests, as some analysts have advocated. Its ndings indi-

cate that despite Maharashtra’s supportive regulatory framework, which in theory

should facilitate cooperative industrial relations, the realities of workplace employ-

ment relations – coupled with state indifference and adverse judicial interventions

– weaken labour’s prospects for meaningful social partnership.

The debate on social partnership or labour–management cooperation has

gained prominence in India since the early 1990s (Mishra and Dhar,

2000; Sankaran and Madhav, 2011). This growing interest in Indian industrial

relations was primarily sparked by the economic reform policies pursued by

the Indian Government since that time. The macroeconomic policy shift from

import substitution to export orientation seems to have resulted in the exclu-

sion of labour from the policy-making bodies established by the Government

and the marginalization of trade unions in collective bargaining arrangements

at the enterprise level (Shyam Sundar, 2009 and 2010). For organized labour

this is a difcult period which, some argue, requires introspection on the part

of trade union leaders on the very nature of the collective representation they

offer to workers in this changed scenario. Venkata Ratnam (2003 and 2009),

for instance, suggests that unions need to focus rst on the interests of con-

sumers, followed by the interests of rms, and nally on the interests of their

International Labour Review368

members. This position subsumes the notion that by prioritizing the interests

of customers, unions would contribute to the nancial growth and protabil-

ity of rms which, in turn, would eventually result in better job security, wages

and working conditions for workers, who would then be more likely to join

or stay with trade unions and thereby increase union membership levels and

inuence. In other words, cooperation with employers on improving product-

ivity and protability is likely to result in mutual gains for all parties to the

employment relationship.

In a large-scale study of employment relations in the new economic con-

text of India, Das (2010) found a substantial rise in the uptake of Japanese-

style human resource management practices by employers in India. This has

resulted in greater employee involvement and participation in decision-making

processes, which are likely to reduce the sense of collective grievance amongst

employees and foster cooperative industrial relations at the enterprise level.

Unions may need to recognize these trends and embrace cooperation rather

than engage in traditional confrontational industrial relations. Failure to do

so may result in marginalization by employers and worker disenchantment

towards the unions.

W.R. Varadarajan, a prominent communist trade union leader of the

Centre of Indian Trade Unions, emphasized the need for labour–management

partnership at a conference organized by India’s largest employer federation,

namely, the Confederation of Indian Industry (CII). He suggested that “[t]here

must be a consensus on social partnership between employers and unions to

avoid chaos and street riots in the present situation of widespread downsizing

of workforce, outsourcing, casualization of labour and deindustrialization as a

result of economic reforms”.1 The CII itself is a strong critic of the country’s

labour regulatory framework which, it argues, confers disproportionate powers

on workers and trade unions in the formal sector of the economy, resulting in

labour militancy, inexibilities, lower industrial output and consequently job-

lessness (CII, 2006). Needless to say, these views are informed by international

policy prescriptions of organizations such as the OECD’s Jobs Strategy and

the World Bank’s Doing Business Reports (OECD, 1996; World Bank, 20 08).

The second National Commission on Labour appointed by the Government

of India aligns favourably on the side of the CII. It recommends a “root-and-

branch” reform of the labour regulatory framework and promotes a spirit of

cooperation between employers and unions in pursuit of industrial harmony

and economic prosperity (India, 2002; Chakrabarti and Dasgupta, 2007).

The 2012–13 Global Competitiveness Index published by the World Eco-

nomic Forum downgraded India by three places compared to its 2011–12 rank-

ing – to 59th place out of 144 countries – and the report was particularly crit-

ical of the country’s inexibilities in hiring and ring, redundancy costs and

wage inexibilities. India is now poorly placed in terms of labour market ef-

ciency compared to other emerging economies such as South Africa, Brazil

1 Reported in The Hindu, a national newspaper, on 26 July 20 01.