Workers` Struggle in Toyoto Kirloskar Motors, India: Changing Capital Labour Relations in Transnational Corporations

Sobin George

Labour File, Vol.4-No.1, One Hundred Days of Work (Article - Workers` Struggle in Toyoto Kirloskar Motors, India: Changing Capital Labour Relations in Transnational Corporations - pp 34 - 37)

The recent incidents of labour strikes in Toyota Kirloskar Motors Ltd (TKML), a Japanese automobile TNC invested in India, shed light on the capital-labour interactions, attributable to the mismatch of foreign-domestic production and management practices. The present labour unrest in Toyota Kirloskar must be looked at in the larger context of the preferential treatment for foreign capital and the integration of foreign production and management practices in India. It has been observed that, in most situations, the integration of foreign production organisation and management practices is incongruent with the production environment in the host countries. Similarly, the labour problems in TNCs are not being noticed or are being neglected because of the preference for attracting and retaining foreign investment in the host countries. The strike in Toyota Kirloskar is, therefore, consciously situated as a disturbing trend of labour unrest in the public sphere. In this context, it is pertinent to locate the present strike in the larger context of the new models of production organisation, preferential treatments, and management practices from a workers` perspective.


A Brief Note on the Unit and Workers

The Toyota Motor Corporation of Japan, in collaboration with the Kirloskar Group in India, established its motor car-manufacturing unit in Bangalore, Karnataka, in October 1997, with a capital investment of Rs 7 billion. Initially both Toyota and Kirloskar held equal shares, and changed to 79:21 in 2001 and to 99:1 in 2003, respectively, resulting in a complete takeover by Toyota Motors. The investment of Toyota Motors in India is largely market-seeking and the share of Toyota Kirloskar in automobile export is comparatively low.


The total strength of the workforce in the production line in TKML is 1,819, encompassing both regular and contract workers. A majority of the workers are from areas close to Bangalore, its suburbs, or neighbouring districts. Some workers are from Tamil Nadu and the rest are reported to be from the districts of North Karnataka and Hassan.


Preferential Treatment

The Central and the State governments include the automobile and auto component industries in the high-priority sector. The government of Karnataka granted Public Utility Service (PUS) status to the automobile industry by redefining the norms of PUS through a notification, amending Schedule 1 of the Industrial Dispute Act, 1947, in 2001. As per the provisions under Sections 22-25 of the Act, workers are not allowed to strike work in public utility services. Also, the amendment to the Contract Labour Act facilitates the outsourcing of activities without any restriction and enables companies to offer contract appointments. In addition, the State government granted scores of incentives pertaining to entry tax, pollution control, land acquisition, investment subsidy, and power and water supply for the company for investing in the State.


The Karnataka Industrial Areas Development Board (KIADB) managed to arrange 450 acres of land costing around Rs 2,300 million on a lease-cum-sale basis for TKML. Furthermore, the State government has exempted the unit from entry tax for a period under the Mega Project scheme.

Production Organisation and Management Practices:

Backdrop of Discontent

The TKML follows the Toyota Production System (TPS) in India. The `kanban` or `just in time` is a universal production strategy for Toyota. Research studies conducted in Toyota factories and ancillary units across the world have shown that TPS is associated with higher levels of workload and stress. The major aspect of the Toyota system of production or pull production is tact time, a ratio of total available task time to the total demand or output produced. Tact time is found to be responsible for multi-tasking, resulting in overwork for the workers in TKML. It is interesting to see how tact time, which is a measure of efficiency (as claimed by the company), is translated into overwork. The fixing of tact time primarily depends on market demand and the availability of workers. The denominator of tact time is the available number of labour force for performing various tasks in the company. Another measure for fixing tact time is the market demand. Between these two, market demand is a fluctuating indicator while labour remains relatively stable in every situation. Given a particular technological and automated production environment, tact time is, therefore, fixed as per the demand of the market. Thus, tact downs (reducing tact time), without increasing the number of workers, lead to overwork. The process of fixing of tact time is also found to be unscientific as it is done on the basis of a rough calculation of the time taken for producing a single piece. Aspects, such as fatigue and exhaustion of workers following continuous fast work, are not taken into account while fixing the tact time. A worker has to comply with tact time throughout the total production of a day, which varies between 100 and 125 units in TKML.


Another practice aimed at hampering the unity of the workers is performance appraisal. Under this system, the performance of the workers is evaluated using variables such as attendance, teamwork, attitude, quality, cost reduction, behaviour, and adaptability. Except attendance and quality, the other criteria appear to be such as can be manipulated by the immediate supervisor of the general workers. It vests an additional power in the supervisor and enables him/her to impose the discriminatory management practices. A consecutive fall in performance points, for instance, can even lead to the termination of services. The performance appraisal system is found to be aimed at developing a hierarchy among workers of the same status. Irrational promotions on the basis of performance and loyalty to the management are deliberately organised to weaken the class-consciousness of the ordinary workers.


Stringent production organisation and management practices coupled with precarious working conditions led to labour resistance in TKML. Labour agitations in TKML must be seen in this specific context. The present strike cannot be seen in isolation; it has been intertwined with many issues and incidents with reference to unfair labour practices, dating back to the year 2001.


The Struggle

The unrest in Toyota Kirloskar started with the discriminatory and unfair labour practices of the management in terms of salary revision, irrational disciplinary actions, and non-confirmation of team member trainees. The salary for confirmed team members in TKML was Rs 3,000 per month till 2001. That year TKML announced a hike of Rs 300 for team members in response to a long-standing demand of the workers for salary revision. This nominal increase was unacceptable to the employees; they boycotted lunch for one day as a token protest on April 2, 2001. Protesting workers were forcefully removed from the site. The management finally agreed to discuss the issue with some representatives of the employees and solved the problem temporarily by granting an additional shift allowance of Rs 5/- per shift for every worker. Nevertheless, a majority of the employees were not satisfied with the decision of the management, and they decided collectively to continue with their protest.


The management started disciplinary action against the leaders to demoralise the protesting workers. After two weeks of protest, the management suspended three workers, accusing them of non-performance and instigating violence. The workers continued their protest, regardless of the pressure tactics of victimisation, suspension, and harassment by the management.


In order to destabilise the collective action of the workers and curtail the formation of an employees union, the management suggested constituting a Team Member Association (TMA) in the unit. Despite differences of opinion, the workers responded positively to the idea. A TMA was formed with 15 elected members. In the meantime, the employment of a team member, who was very active in the struggle, was terminated for non-performance. Disciplinary action against the workers continued despite the formation of TMA and even extended to the termination of an elected TMA member. The workers sought explanations from the management for the suspension of workers through the TMA. The management was not ready to entertain the TMA as a body for bargaining and negotiation; it considered the functions of the TMA to be restricted to issues of workers` safety and welfare. This led to another strike, which continued for 12 days.


Repeated disciplinary actions by the management and the incapability of the TMA to counter them prompted the workers to register the TMA as a trade union. The employees union in TKML, affiliated to Centre of Indian Trade Unions (CITU), was formally registered in July 2001. The workers organised themselves under the banner of Toyota Kirloskar Motors Employees Trade Union and submitted a charter of demands to the management asking for revoking the decision of suspensions and terminations and reducing the training period from three years to one year.


Some of the demands of the employees` union were settled in a tripartite meeting organised by the Assistant Commissioner of Labour, Bangalore. As a result of the meeting, the training period was reduced to two years from the existing three years and some proceedings were chalked out pertaining to the confirmation of trainees. However, the demand of revoking the suspensions and dismissals was not settled in the meeting. The termination of workers continued.


In December 2001, a trainee`s services were terminated although he had completed two years of traineeship. The trade union agitated against the suspension and served a strike notice in the first week of January 2002. This led to further disciplinary action and the jobs of two of the office bearers of the union, the general secretary and joint secretary, were terminated. The workers immediately went on strike. It lasted 52 days on a single-point agenda-reappointment` of the two union leaders. It was at this juncture that the Government of Karnataka categorically included Toyota Kirloskar in the Public Utility Service. The strike was, therefore, called off.


Victimisation and disciplinary actions, thereafter, took their worst toll; the management started selectively suspending the union leaders on a charge of non-performance. In January 2004, two employees, who were executive members of the union, were suspended without any notice or enquiry for non-performance and for `threatening the supervisor`. Though the union approached the management for a fair enquiry into the action, it did not bring any result. The union then refused compulsory overtime as a token protest and gave notice to the management on boycotting the morning meeting and physical exercise, a part of the work. This led to the suspension of many union members. Within a period of three weeks, sixteen members of the union were suspended for `intimidating` team members to boycott morning meeting and exercise.


In June 2004, the employees union submitted to the management another charter of demands relating to the suspended workers, wage revision, shift allowance, and leave allowance. The management accepted only the wage revision demand. The protest continued peacefully in the form of boycotting lunch and wearing black badges at the workplace. In March 2005, the union submitted a new charter of demands including a fair enquiry and a re-examination of the disciplinary action on 15 suspended workers. All the demands were turned down; the union served a strike notice in May.


The employees demonstrated and campaigned outside the premises of the company. Protests and demonstration rallies extended to the city of Bangalore. The pressure mounted upon the administration and the Minister for Labour, government of Karnataka, held a discussion with the union members and management for resolving the issue. The management did not revoke the suspension of the workers. Discussions with the Deputy Labour Commissioner also did not bring any result. The present strike, which started on January 6, 2006, subsequent to the suspension of three employees for `severe misconduct`, is part of the long struggle of the workers against the practices of victimisation of the unit.



There is a conscious effort to portray the struggle of the workers in TKML as unfair, illegitimate, and against the interests of the economic growth of the country. The reports in mainline media, both inside and outside the country, equated the struggle with hampering economic growth. The management, with the help of the government machinery, police, local government bodies, and media manipulate the labour struggle and propagate discontent against the striking workers. This operates at various levels. The categorical inclusion of Toyota Kirloskar in Public Utility Service by the State government, for instance, was at a stage when production was seriously hampered due to the strike in the unit. The government, to retain the investment in the State, had made regulations flexible in the form of labour laws in tune with the requirement of the company. In addition, the State government provides support through police machinery and Industrial protection force for dealing with any immediate need of labour unrest. Local administration also unequivocally supports the management and discourages union activities in the locality for their services of development of infrastructure facilities such as roads and streetlights and village beautification. Media manipulation is also reported to be practised by the management to curtail union activities. In short, management manipulates the strike through a network of State machinery, local administration, and media.


The case of Toyota Kirloskar, therefore, points to an urgent need for challenging the irrational priority treatment of the Central and State governments for TNCs, by according public service utility status for instance, that curtails the right of workers to protest. Though workers are organised in Toyota Kirloskar, in many cases the collective actions do not translate into effective negotiations or settlements. Therefore, there is also a need to empower and support the unions through education and advocacy.

Sobin George is a Researcher in Migrant and Contract Labour Programme, CEC, New Delhi and Centre of Social Medicine and Community Health, JNU. E-mail: