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The taming of Kerala's unions

Suresh R Menon

With a lush green landscape, pleasant climate, and one of the most well-educated workforce in the country, God's Own Country should be a paradise for industry.

But industrialists have hardly been falling over themselves to invest in the state, mainly because of its militant labour unions and low productivity of its workforce.

Horror stories of labour practices abound. For instance, atti mari, in which the unions don't allow trucks to be unloaded, even if one is doing the work oneself, unless they're paid for it.

But the failure of the strike in February by over 500,000 state government employees, supported by 60-odd trade unions, may mark a watershed in the state's troubled history of labour relations.

Indeed, industry chambers in the state are already hailing this as the dawn of a new beginning. Indian Chamber of Commerce & Industry president N Radhakrishnan says the strong stand adopted against the strike by the United Democratic Front government led by A K Antony has, to some extent, clipped the wings of trade unions in Kerala.

He adds, "This development will pave the way for greater investments in Kerala, and promote the economic interests of the state."

Some trade union leaders also privately concede that the Kerala government is becoming more investor-friendly and less pro-worker, and this will make the task of the unions more difficult, because of which they are gradually losing their clout.

The strike may be over for now, but the unions have by no means been tamed, they've merely been quelled for the moment, says Centre of Indian Trade Union state secretary Chandran Pillai.

He disagrees with the general perception that the February-March government employees' strike was a total failure, and says, "The state government has accepted two of our 28 demands, and has also promised that it is willing to initiate discussion on the remaining items after a year."

He further warned that government employees were prepared to strike work again, if the government violated the agreement.

In January, the state government decided to abolish some perks, like the leave encashment of its employees, as part of an austerity drive.

The chief minister's attempts to explain the necessity for such drastic cost-cutting failed, and state government employees launched an indefinite agitation on February 6, hoping that their perks would eventually be restored.

After all, every government in the past had given in to the demands of the workers and trade unions. Family members of the striking employees, including children, joined the strike, with hundreds laying siege to the state secretariat.

Demonstrations and picketing were a common sight across the state. But this time the state government decided not to be threatened, and held out against the agitating staff for over 32 days, even as the Kerala exchequer suffered huge losses from the strike.

The daily losses from sales tax not being collected was around Rs 120 million.

However, the chief minister stuck to his guns and made it clear to the striking employees that there was no going back on the reforms introduced to curtail government expenditure. The strike failed miserably.

Antony, a Congressman widely known for his probity, had no option but to be tough.

"All these years the government's job was merely to pay the salaries of its employees at the cost of the state economy. Now there is no money in the treasury and, therefore, employees will not get the benefits that have been withdrawn," Antony said even as the strike entered its fifth week.

The failure of the strike came as a shot in the arm for Antony as well as the ruling UDF. The chief minister was clearly elated.

He was optimistic that the state's financial position would look up within a year. According to him, the withdrawal of perks alone would save his government Rs 5 billion this year and Rs 9 billion in the next year.

Antony said one major reason for the strike's failure was that the common man, irrespective of his political affiliation, was against it.

He said, "This shows that the mindset of the common man has changed. Only the bureaucracy, politicians and media are still caught in the old matrix."

This was followed by Antony telling the media in Thiruvananthapuram on May 14 that his government was now determined to bring about a change in the perception that Kerala was not an investor-friendly state.

The stigma of trade union militancy associated with Kerala would soon be a thing of the past, he added.

While that remains to be seen, on May 21, the Kerala government announced plans to unveil a new labour policy contemplating major labour reforms and drastic amendments to the Trade Union Act.

The new policy is to be tabled in the state Assembly on June 12. Babu Divakaran, minister for labour and rehabilitation, said it would lay down a detailed roadmap for a social safety net that would cover even the unorganised sector.

"Major reforms are contemplated in the functioning of trade unions, industrial disputes and contract labour," he added.

Businessmen in the state hope for a new beginning on the labour front. Cochin Chamber of Commerce & Industry president V R Nair says, "Kerala has finally woken up to the ground realities. Having been pushed to the wall, we are finally beginning to see the beginning of a new chapter in the history of the state. We have finally begun making the right moves to kick-start the state's economy and promote economic growth, development and well-being."

Radhakrishnan too says he is confident that Kerala will see radical changes in the labour sector in the days to come. A wise forecast of what the future will hold? Time, no doubt, will tell.

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