ACKNOWLEDGEMENT

I would like to express my sincere thanks to Mahindra university for giving me the
opportunity to prepare and present this report. “There is a good saying that the work is
successfully done by the person is guided properly at the right time by the right person”. With
that the good opportunities that we receive as well as the efficient supervision and the most
valuable internal guidance. Hereby I would like to express my deep gratitude to our prof.
Vinay Sharma, who is there in his busy schedule also provided us with full support and
encouragement and direct or indirect support in the completion of the project.

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 Table of Contents
Introduction................................................................................................................................5
Objective of the study................................................................................................................5
Facts of the case.........................................................................................................................5
Industrial relations......................................................................................................................6
Manesar violence July 2012.......................................................................................................7
the legal implications.................................................................................................................8
Causes of the 2012 labour unrest at Maruti Udyog Manesar limited........................................9
Conclusion..................................................................................................................................9

Introduction

Maruti Suzuki India Limited (formerly Maruti Udyog Limited) is the Indian
subsidiary of Japanese automaker Suzuki Motor Corporation. Maruti Suzuki
India Limited (MSIL) was established in February 1881 and at one point of time
it was primarily a government owned company by holding a 74% stake in the
company and 26% by Suzuki Japan. Maruti Suzuki India Ltd. Is India’s leading
and largest passenger car manufacturer as of September 2022, the company had
a leading market share of 42% in the Indian passenger car market.
The labour unrest at the MSIL Manesar plant in 2012 was a significant event in
the history of Maruti Suzuki India Limited. It stemmed from a dispute between
the management and workers over various issues, including wages, working
conditions, and the formation of a labour union.
The conflict escalated on July 18, 2012, when a scuffle broke out between a
worker and a supervisor. Subsequently, violence erupted in the plant, leading to
the death of a senior human resources manager and injuries to several other
employees and the company declared a ‘Lock out’ and several of its employees
were arrested

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Objective of the study

To Know the occurrences at Maruti Udyog Limited Manesar plant which took
place in December 2011 and in July-September 2012 which led to the murder of
a senior HR executive and extensive damage to property
And to Assess the possible causes for the criminal acts which took place in 2012
at Maruti Udyog

Facts of the case

1. MSIL in its Manesar factory had as of 2011, employed a total of 2,500

workmen, out of which 1,100 were permanent employees and the rest
1,400 consisted of workers on contract, apprentices and trainees.
2. An unskilled contract worker was paid INR 5,500 a month, and a
skilled contract worker (with an ITI diploma) INR 7,000 whereas
permanent workers were paid close to INR18,000 per month.
3. The benefits provided to a permanent employee included medical
benefits, bus service, and paid leave, none of which were provided to
workers on contract, although on ground, the nature of work remained
the same for both categories of employees.
4. The process for an individual to become a permanent employee at
MSIL was lengthy and never guaranteed. A skilled worker had to work
for a year as an apprentice and another three years as a trainee before
he was made permanent, being an unskilled worker meant that there
was little or no hope of being made permanent.
5. In addition to these glaring disparities, the general working conditions
were told to be ‘difficult’ with little or no time for breaks, huge
deductions in pay for leave and almost non-existent pay for working
extra time in case of workers who were not permanent employees.
6. The MSIL Manesar Union is said to have made demands which
included, a fivefold increase in basic salary, monthly conveyance of
INR 10,000/-, laundry allowance of INR 3,000/, gift with every new
launch, a house for every worker who wants one, cheaper house loans,
seven weeks paid vacation, 40 days’ allowance for sick and casual
leave.
7. None of these terms were acceptable to MSIL and even before any
solution could be found a stray incident involving the suspension of a
worker is said to have triggered off serious violence on the 18 th of July
2012, that ended with an HR manager being killed, several people in

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 management (close to a 100) being injured, 9 policemen being injured
and the plant being evacuated and sealed.
8. MSIL called a lock-out citing security issues and claimed that none of
the workers would be paid for the duration of the lock-out. Further,
MSIL claimed that the difference in pay between the contract
labourers and permanent workers was much smaller than claimed by
the union and that MSIL gave its contract workers the best pay and
benefits in the region.
9. Over 90 workmen were arrested, in August 2012, MSIL dismissed 500
workers accused of participating in the violence and restarted
operations

Industrial relations

In 1997, with the changed ownership, Maruti came under government control.
From there on, the conflicts between the United Front Government and Suzuki
started
In 2000, a major IR issue began and employees of Maruti Udyog went on an
Indefinite strike, demanding major revisions of their wages,
Incentives and pensions
In 2001 The management did not pay heed to the union demands because of
increased competition in the automotive-sector and lower profit margins.
The central government prevalled and privatized Maruti Udyog m.2003. Suzuki
of Japan became the- majority owner of Maruti Udyog-Limited with 51% share
with the public holding 12.5%.
In late 2011 and early 2012, labour unrest started. In the Manesar Plant with
Sonu Gujjar, a local labour leader demanding right to establish an alternative
labour union due to non alignment of a large section of workers with
the existing union.

Manesar violence July 2012

 From April 2012, the Manesar plant workers' union demanded a fivefold
increase in salary, a monthly conveyance allowance of 10,000, a laundry
allowance of 3,000.

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  A corporate gift with every new car launch, and a house for every worker
who wants one or cheaper home loans for those who want to build their
own house.
 In addition to this compensation and normal weekend/holidays. the union
demanded the current four pard weeks of vacation be increased 10 7
weeks, plus each worker to have 40 days of sick leave and casual leave
amounting to 75 days.
 The workers claim harsh working conditions and extensive hiring of low-
paid contract workers who are paid about 7500 a month, which works out
to half the minimum wage paid to permanent employees.
 On July 21, 2012, citing safety concerns, the company announced a
lockout under The Industrial Disputes Act, 1947 pending results of an
Inquiry which the company has requested by the Haryana government to
determine the causes of these Incidents
 Under the provisions of The Industrial Disputes Act on wages, the report
claimed, employees are expected to be paid for the duration of the
lockout. 0n July 26, 2012 Maruti Udyog announced that employees
would not be paid for the period of lock-out in accordance with
labour laws of India.

the legal implications

The term ‘strike’ is defined in Sec 2(q) of the Industrial Disputes Act, 1947 as a
cessation of work by a body of persons employed in any industry acting in
combination, or a concerted refusal, or a refusal, under a common
understanding of any number of persons who are or have been so employed to
continue to work or accept employment.
The provisions of the Act, lay down the procedure to be followed by employees
who want to go on strike. A strike is considered illegal if said procedure is not
followed. The consequence of an illegal strike includes imprisonment and fine,
loss of wages and dismissal of the workmen (in the case of a violent illegal
strike).
‘Lock-out’ as defined under the Act means the temporary closing of
employment or the suspension of work, or the refusal by an employer to
continue to employ any number of persons employed by him. Lock-out is the
counterpart of a strike; it is the option available to an employer, and the Act
deals with it in the same terms as a strike. Therefore, lock-out like strike has to

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follow procedures laid down in the act for it to be considered legal. Illegal lock-
out, like illegal strikes, carries penalties.
In the MSIL case, the strike called in July 18th, 2012 has been considered illegal
and therefore the lock-out declared by MSIL is legal. The actions taken by
MSIL thereafter including dismissal of the workmen would be valid actions.
The criminal cases filed against several of the employees are still sub-judice,
and hence, a conclusion regarding the same may only be arrived when the case
concludes.
However, it is important to note that in the MSIL case, although it would seem
like MSIL did follow the labour laws including the minimum wages prescribed
for that region, the facts of the case reflect the inherent injustice and unfairness
meted out to a section of workers. Hiring labourers as contract and temporary
workers to avoid paying for their benefits while the level of work and skill
required by both categories remaining same has been the main cause for
dispute. And although the Contract Labour (Regulation and Abolition) Act,
1970 mandates that any company that has to employ contract labour needs to
obtain a license from the labour department and that the labour department can
cancel the license if the rights of the contract labourers are abused. It is evident
from the facts of this case that these provisions were not implemented.

Causes of the 2012 labour unrest at Maruti Udyog Manesar limited

 Wage disparities between the regular and contracted workers. Uncertainty

in the minds of the contracted workers regarding their future as
employees of Maruti Suzuki,
 Lack of trust between the HR staff and the workers. The workers
perception of HR executives is a major cause for concern.
 Lack of connectivity and active communication between the management
and workers.
 Lack of intelligence and information.
 Possible-collusion of local police, retrenched workers and politicians
 Workers, both permanent and contracted feel that they are not being given
their due share of the huge profits Maruti Udyog is making with the
highest market share in the car industry.

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Conclusion

India in a bid to protect the interests of the workers has legislated several labour
laws, however, it is commonly accepted that the laws are too complex and have
given rise to complicated processes due to which most companies have found
alternate means of doing business that largely circumvents the protective laws.
The labour laws are either avoided or poorly implemented; therefore the
percentage of workers actually protected by the legislations are small, and a
large populace of workers are left to fend for themselves. In a country where
there is a huge population of unemployed, unskilled labour, companies rarely
find it hard to replace workers who ask for more, skilled or otherwise.
In conclusion, one may note that unless the human element is taken into account
and fair treatment to all workers, temporary or permanent is meted out, labour
unrests and strikes are bound to raise. In today’s Internet-connected world
where information is literally at one’s fingertips, unfair practices will meet
protests.
Labour laws are in need of being overhauled and while doing so, taking the
opinions of the people concerned both labour unions and industry leaders is
highly recommended.

Co. should maintain employee labour relationship in a good manner.

Employers should treat employees as humans. They should take care of
the employees about their wages perks , allowances and etc.
The workers should refrain from taking law into their own hands.
Communication of intention at all levels plays an important role in
reducing trust deficit. So, communication should improve for.
improvement in the Industrial Relationship.,
HR executives to increase their involvement at the floor level with the
workers in addition pursuing their professional education and career
development
Angadi, A. &Patil, S.V. (2021). Issues, Challenges, and Opportunities of Indian
Startups: A
Study, Journal of Emerging Technologies and Innovative Research, 8(10), c637-c644.
Angadi, A. &Patil, S.V. (2021). Issues, Challenges, and Opportunities of Indian
Startups: A
Study, Journal of Emerging Technologies and Innovative Research, 8(10), c637-c644.
Angadi, A. &Patil, S.V. (2021). Issues, Challenges, and Opportunities of Indian
Startups: A
Study, Journal of Emerging Technologies and Innovative Research, 8(10), c637-c644.

Page 7 of 8
Angadi, A. &Patil, S.V. (2021). Issues, Challenges, and Opportunities of Indian
Startups: A
Study, Journal of Emerging Technologies and Innovative Research, 8(10), c637-c644.
Angadi, A. &Patil, S.V. (2021). Issues, Challenges, and Opportunities of Indian
Startups: A
Study, Journal of Emerging Technologies and Innovative Research, 8(10), c637-c644.
Angadi, A. &Patil, S.V. (2021). Issues, Challenges, and Opportunities of Indian
Startups: A
Study, Journal of Emerging Technologies and Innovative Research, 8(10), c637-c644.

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