Reinvent, update, be sensible: A survival guide for trade unions

Mumbai: The nationwide strike called by trade unions on Wednesday across sectors has paralysed critical services, including normal banking operations. The strike has been called by the trade unions to press their 12 demands and despite assurance from labour ministry on Tuesday evening that the government is ‘positively’ working on at least nine demands.[caption id=“attachment_2418480” align=“alignleft” width=“380”]  Striking unions. PTI [/caption] The unions are striking work on issues including job creation, control of prices of essential commodities, guaranteed minimum wage of Rs 15,000 to all workers, removal of ceiling on bonus and gratuity, extending maternity leave benefits to all women workers and strengthening social security funds, among others. Also, they are against foreign direct investment in key sectors such as railways, reforms in labour laws, privatisation and disinvestment in public sector units. The unions are fully within their rights to press their demands on some of these issues such as guaranteed minimum wage, maternity benefits to all workers, since these are specific to employees’ welfare. But, some others, like price control of essential commodities, disinvestment and more job creation, are larger economic issues. Similarly, opposing disinvestment and privatisation of state-run companies are regressive in nature and against the very reform agenda that is much needed to revive the economy. The government has already assured that it is working on the minimum wages Act, calculation of bonus and pension amounts. The labor ministry has promised that the trade unions will be taken into account whenever labor law reforms are undertaken. But the trade unions decided to go ahead with the strike plan despite these assurances. It would be just a wishful thinking to imagine the country without trade unions for the simple reason that major trade unions enjoy the backing of political parties. Traditionally, trade unions have commanded a major say in the running of state-run entities, especially banks. These unions have acted as a corrective force against the excesses by managements and unfriendly government policies. In September 2013, the country’s largest lender State Bank of India had unleashed a severe attack on its trade unions by discontinuing the check off facility for unions (which they use to collect monthly contributions from members) and taking punitive actions against union leaders. But, SBI later had to take a U-turn and restored the facility following a court directive. However, in the recent years, the unions have somewhat lost steam, especially in the public sector banks, with the newly joined young officers and employees showing no active interest in union activities, even though most of them religiously contribute to the monthly subscription fees. Banks in particular have made serious efforts to break the back of trade unions, but without success. It is crucial that these employee unions reinvent themselves and keep themselves updated with the changing reality of the world. Paralysing normal life with unrealistic demands such as one opposing the bank consolidation wouldn’t augur well for the trade unions because they face the becoming redundant and inviting the wrath of the public. For instance, disruption of banking services not only cause difficulties for the common man, but also results in massive business losses for banks. “It is difficult to quantify the losses. But such strikes impacts the operations almost nationwide,” said a senior banking industry official to Firstpost, requesting anonymity. Take one example. Merger of the state-run banks is inevitable since some of them, with irreparably cracked balance sheets, are on the death throes. Disinvestment in state-run entities and privatising them eventually are key steps. The government cannot keep infusing tax payers’ money into sick PSUs such as Air India, to keep them afloat. That will be akin to pouring water into a leaking pot. Also, for a country like India, which is still fighting poverty and struggling to ensure basic provisions to a large section of the population, it is highly necessary to bring in foreign capital to develop its infrastructure — roads, railways, ports and airports. Under the current five-year plan, the country needs an investment of a trillion dollars for infrastructure development. The country’s fiscally constrained government, its weak banking sector and a shallow bond markets do not have the wherewithal to fund such massive requirement. Foreign money is a necessity here not a luxury. Also, it is unwise and regressive on the part of the trade unions to oppose foreign direct investments in critical sectors since the growth of the sectors concerns to the welfare of these very employees. Reforms are critical for India to ensure economic progress and this cannot happen with the trade unions fighting with the government on key policy issues and paralysing the nation to press their demand of a few lakhs of employees. In a highly unionised public sector like India’s, it is important for employee unions to set realistic agenda and work with the government constructively towards the overall economic growth, at least on critical policy issues. If not, trade unions will run the risk of finding themselves redundant eventually.