With labour problems increasing in the auto components sector in Tamil Nadu, the state government has decided to declare the segment as a public utility service in line with the status already enjoyed by original equipment manufacturers. The labour unions are planning to oppose the move.
According to sources, a government order has been issued, stating that the Tamil Nadu Governor is satisfied that in the larger public interest, the Auto Components Manufacturing Industry should be declared a public utility service under the Industrial Disputes Act, 1947 (Central Act XIV of 1947). The Act will be applied for a period of six months, the order said.
The development comes in the backdrop of frequent strikes in the past few months at various component making units, including Comstar Automotive Technologies, Youngshin Automotive India (MSI), Pricol and NVH India Auto Ltd, (which supplies to Hyundai Motor India). The industry has welcomed the move.
Under the Industrial Disputes Act, persons employed in public utility services cannot go on strike without issuing a notice six weeks in advance. The strike must also not be organised within 14 days of giving such a notice, or during ongoing conciliation proceedings, or even within seven days of the conclusion of such proceedings.
A Soundararajan, the State President of CITU (Centre of Indian Trade Unions), said that this would in effect mean that the workers cannot engage in strike for their rights. Once the segment is treated as public utility. Since prior notice is required, they cannot protest during the time of conciliation and even if the conciliation fails, the matter would go to court.
Tamil Nadu has a well-developed auto ecosystem and is among the top 10 automobile hubs worldwide. The state accounted for about 45 per cent of India's motor vehicle exports in 2017-18. It also accounts for 35 per cent of India’s auto component production and has MRF, the largest tyre maker in the country.
Chennai has an annual installed capacity of 1.71 million cars. India's sixth largest city, often referred as the Detroit of India, produces three cars a minute, one truck every two minutes and one motorcycle every six seconds.