(Reuters) – Hiding in his office near the Indian capital as workers armed with iron bars and car parts rampaged through the factory, Maruti Suzuki supervisor Raj Kumar spent two terrified hours trying to comprehend the warzone his workplace had become.
By the end of the day, one of his colleagues had been burnt to death and dozens wounded, many with broken bones, as a long-running struggle between the shop floor and management exploded at a factory racked by mistrust.
While police investigate and the carmaker counts its mounting losses, the July 18 clash has rattled corporate India and shone a light on outdated and rigid labor laws in a country where cheap labor drives manufacturing and draws foreign investment. High inflation, a shortage of skilled labor and rising aspirations have emboldened workers’ demands.
“There was always a strong sense of unease,” Kumar, 43, told Reuters as he stood outside the locked factory gates more than a week after the riot in the industrial town of Manesar.
“We are living in fear… The kind of violence these guys showed was unbelievable.”
Other foreign carmakers, such as Hyundai and Honda, have seen labor unrest at their Indian plants in recent years, and industry groups have renewed calls for the government to overhaul laws they say tie their hands.
“This is definitely sending a wrong message. Investors will be reluctant,” P. Balendran, vice-president at General Motors’ Indian unit, said of the Manesar violence. “The need of the hour is flexible labor reforms. In 2012 you cannot afford to have a rule which is applicable … from 1956.”
India’s labor laws, some dating to the 1920s, make it difficult for large companies to fire permanent workers, forcing companies to hire large numbers of contractors – a bone of contention with many unions.
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