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Freewheelin' Capital: Illegal Dismissals, Forced 'Voluntary' Retirement & Contractualisation of Workforce at Maruti Udyog Limited

15 Aug 2007

In 2001, PUDR had brought out a report‘Hard Drive’ on workers’ agitation in Maruti Udyog Ltd, which had led to a lockout and severe repression by the management. The management crushed the existing workers’ union by dismissing its active members and office bearers and by drastically changing the working conditions causing distress to the remaining workers. This was also the time when the Government of India was making gradual moves to turn MUL from a joint sector to a privately owned enterprises. We had alluded to significant changes in the making in MUL in ‘Hard Drive’. We had warned that following the rout of the union, the company was contemplating the introduction of a Voluntary Retirement Scheme and there would be widespread job losses and changing working conditions. Nearly six years after that report, PUDR was once again approached by the now de-recognised Maruti Udyog Employees Union (MUEU) to conduct a follow up study to inquire into the fate of 24 employees who were first dismissed without a fair enquiry and without due procedure being followed. PUDR decided to take up this issue, not only in the context of MUL’s retrenchment process, but also as a case study of how workers rights are systematically disposed off in the new economy.

We also examined how VRS was carried out in two phases in MUL (in 2001 and 2003), resulting in the involuntary retirement of nearly 2,500 workers which in turn, led to the replacement of permanent workers with contract workers.