Wage dispute at Toyota plant in India hits production

Japanese car major, Toyota, has declared a lockout at its manufacturing plants in Bidadi on the outskirts of Bangalore, Karnataka. With effect from March 16, the lockout follows a wage dispute between the Toyota management and the workers union.

The company says they were left with no other option but to declare a lockout to ensure the safety of its workers and management personnel. Toyota claims that under the instigation of the union, certain sections of the employees have resorted to deliberate stoppages of the production line, abuse and threatening supervisors, thereby continuously disrupting business for the past 25 days.

The company thus claims that as a result of the go-slow strike by workers, there has been a production loss of 2,000 vehicles during this period.

According to a company statement, "The Management and the Union have been discussing the charter of demands for the period FY13-14 for the past 10 months. As bipartite agreement was not reached, the Labor Department of the Government of Karnataka conducted 7 tripartite meetings in order to reach a settlement. The conciliation efforts of the Labor Department have not yet resulted in an agreement."

The workers are demanding Rs 8000 per month wage increase for FY 13-14 due to the higher cost of living but TKM's offer stands firm at Rs 3050 per month. This is slightly higher than what TKM offered earlier at 2400 per month. The company claims that given the current slowdown in the Indian auto market and steep depreciation of the rupee, it is not in a position to offer more. TKM revises wages every fiscal year, beginning April, unlike many other firms that revises wages once in three years.

The workers union has termed the lockout illegal as it was suddenly declared without the mandatory 14-day notice to employees and intimation to the Karnataka Labour office.

Toyota Kirloskar Motor is an 89:11 joint venture between Toyota and the Pune-based Kirloskar Group. TKM exploys over 6400 employees and the two plants at Bidadi have a total installed capacity of upto 3,10,000 units annually.