A Century of Quality & Trust

Organization Profile:
One of the leading automobile OEM situated in Tamil Nadu with rich heritage and history of >100 years,
right from its inception, believed in its destiny of growth, success, and longevity. The method and
integrity of conducting business is what sets the organization apart from the rest.

The company has won many awards at national and international levels including Deming Prize. The
company has retained the No.1 position continuously for four years in a row at national level for
customer satisfaction.

The company has seven manufacturing facilities including one at overseas, it is the second largest
automobile exporter in India with exports to over 60 countries, third largest manufacturer in domestic
market with an annual revenue of >Rs.20,000 crores and 15% market share.

Employees Profile:
Managers & Executives – They are in the top of the hierarchy and ranges from entry level executives
who does operational activity to strategic leaders who decides the business fates. The total strength of
such category of employees is 2,000 and their engagement is governed by the order of appointment
issued to individuals and the code of conduct. They are working across all sections of organization. Out
of the above, around 800 young and vibrant Engineers are engaged in its full-fledged R&D Centre where
they are doing research on future mobility solutions through innovation and creativity. Compensation
and benefits are bench marked and competitive in industry.

Workmen – They are bargaining category of employees in permanent rolls of the organization. They are
engaged in shop floor areas like assembly, painting, fabrication, plant maintenance, engineering, stores
and few of them are into craftsmanship and clerical activites. The educational qualification ranges from
school drop out to ITI. Average age is 40 years due to industry trend of not hiring them for more than a
decade. The total strength of such category of employees is 1,000 and constitute 25% of the shop floor
strength. Their engagement is governed by the order of appointment, the Certified Standing Orders of
the company and certain customary practices of the organization. Compensation package is in 70th
percentile of region-cum-industry bench marking.

Floaters & Trainees – As automobile business always have peaks and valleys, engagement of these
category of trainees is resorted to. Their job is temporary in nature from 9 months to 36 months. This
category includes Temporary Workman and Diploma Trainees. Their engagement is governed by the
order of appointment and the Certified Standing Orders of the company. Apprentices under the
Apprentices Act and Trainees under the NEEM scheme are also engaged. They are from Tier2
Polytechnic Colleges or Industrial Training Institutes. They are aged between 18 and 24 years. The total
strength of Trainees is 3,000 and constitute 75% of the shop floor strength. Compensation package is
revised every year based on the Govt notification for revision of Minimum Wages. However, the
organization is paying more than the Govt prescribed salary towards attraction and retention.

Contract Labour – Around 2,000 CLs are engaged as per the Contract Labour (Regulation & Abolition)
Act, mainly to do peripheral activities like cleaning, movement of vehicle and materials etc. The
organization included major corporates in its Certificate of Registration for availing specialized / skilled
services.

Industrial Relations:
All workmen are members of one Employees Union and the management’s approaches to union are
‘Trust Based’, ‘Consultative & Participative’ and ‘Fair & Firm’. The management is maintaining cordial
and productive interface with employees and union and continues to hold a record of zero mandays
lost due to labour unrest or strike for many decades. Workmen are actively involved themselves in
productivity improvement, cost saving through Total Employee Involvement activities like suggestions
scheme and Quality Control Circles. The annual cost savings is more than Rs.5 Crores. The business
and market share grow YOY. Contract Labour and Floaters/Trainees are not associated to any union so
far.

Environmental Scan:
• Though workmen and floaters work together, there are few issues and setback between them. This
is because of generation gap, employment status, salary difference and facility privileges. Floaters
feel that they are not much recognized considering their tenure.

• On one hand, Diploma Engineers from premier or Tier1 polytechnic colleges are engaged in shop
floor as supervisors in Executive category. On the other hand, Diploma Engineers from Tier2
polytechnic collages are also engaged in shop floor for operating machines as Trainees. Hence, they
feel de-motivated and a few cases have been reported. Inter personal relationship between Senior
Workmen and Diploma Engineers who are half their age, is not healthy

• Skill retention is very important for quality, speed and agile for manufacturing process. Hence,
Floaters / Trainees are retained up to three years as there is a provision in the Certified Standing
Orders of the company, inspite of Tamil Nadu Industrial Establishments (Conferment of Permanent
Status to Workmen) Act, 1981. On completion of their tenure, organization is trying to place them
elsewhere as a responsible corporate citizen. However, the efforts taken by them are futile and
there is an uncertainty about future employment among floaters/trainees.

• Floaters / Trainees belong to GenZ are having their own needs, aspiration and life style. It does not
align with traditional manufacturing culture. Issues like absenteeism, non-adherence to uniform
wearing standard and personal grooming. However, the steps taken to align them in line with
organizational culture is long way to go.

• Both manufacturing facility and R&D Centre are in the same factory premises. However, employees
of both facilities have different set of workplace perks and benefits. R&D Centre has flexi working
hours, 5day work pattern, liberal inter department movements, access to buy and eat facility,
autonomous environment to motivate them to think for creative and innovative ideas. Whereas
manufacturing facility is rigid, time bound, hierarchical environment including 6day work pattern,
restricted movement of employees, 3 shifts working, etc. Hence there is a cultural shock happens
among employees. However, basic needs like common canteen, medical facility, transport facility
and uniform are extended to all employees. Whereas workmen feel company is favoring only to
employees of R&D Centre. On the other hand, the young engineers of R&D feel that the
organization is rigid in its approach towards employees, considering the policies on frisking, mobile
phone, attendance recording, etc.

In this scenario, please offer your suggestions which would help the organization continue to maintain
peaceful Industrial relations for another decade, while addressing each point in the environment scan.