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‘No Room for Class Struggle in These National Undertakings’: Providing social welfare for Indian state sector industrial workers (circa 1950–2000)*

Published online by Cambridge University Press:  04 May 2015

DILIP SUBRAMANIAN*
Affiliation:
NEOMA Business School-Georg Simmel Centre (CNRS-EHESS), Reims Cedex, France Email: dilip.subramanian@neoma-bs.fr

Abstract

Independent India's new state-owned infrastructural industries were not only entrusted with the mission of producing essential public commodities, but they were also required to promote the economic and social advancement of their workforces. To achieve this objective, big public enterprises in particular, helped by the financial power they derived from their control over the strategic sectors of the domestic economy, established generously endowed welfare programmes. This article argues that such a developmental ideology shaping managerial policy orientations is central to understanding why accepted explanations for the rationale of employer-sponsored social benefits are insufficient when it comes to studying similar initiatives in the Indian public sector. To substantiate its argument, the article explores the provisioning of social needs over a period of roughly half a century (1948–2002) at a large state-run producer of telecommunications equipment, Indian Telephone Industries. The welfare regime as it evolved here boasted one unique feature: it rested on dual foundations, with both the company and the trade union assuming independent responsibility for the well-being of employees. A range of informal self-help schemes devised by workers further supplemented the institutionalized social security net set up by the management and the union. The article also discusses how the firm sought to scale back its largesse in the aftermath of economic liberalization.

Type
Research Article
Copyright
Copyright © Cambridge University Press 2015 

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Footnotes

*

Different versions of this article were presented in Nantes and Göttingen. I am grateful to all the participants at these two venues for their comments. Special thanks are due to the two anonymous reviewers for their constructive feedback, to Johnny Parry for asking the right (tough) questions, and to Mark Holdsworth for vetting previous drafts.

References

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9 The corresponding figure for the workforce at the Bangalore factory stood at 7,897 employees.

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11 For the purpose of this article, I have relied on both archival and oral material, supplementing a wide range of primary sources (minutes of management meetings, minutes of management–union meetings, security department files, departmental notes and memorandums, etc.) with interviews with top and middle management officials, union representatives, and blue- and white-collar workers.

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15 Replies to National Commission of Labour questionnaire, 1967 (ITI Personnel Dept. files).

16 Parry, ‘Nehru's Dream’.

17 Manufacture of Telecommunication Equipments in a Developing Country, ITI, nd, p. 20 (roneo).

18 Interview with M. V. Srinivasa Rao, ex-Executive Director, ITI Bangalore plant, February–March 1999, Bangalore. Emphasis added.

19 Parry, ‘Nehru's Dream’; J. Parry and C. Strümpell, ‘On the Desecration of Nehru's “Temples”: Bhilai and Rourkela Compared’, EPW, vol. 43:19, 2008, pp. 47–57; Strümpell, C., ‘“We work together, we eat together”: Conviviality and Modernity in a Company Settlement in South Orissa’, Contributions to Indian Sociology, vol. 42:3, 2008, pp. 351–81.CrossRefGoogle Scholar

20 Kling, ‘Paternalism in Indian Labor’; Sanchez, A., ‘Deadwood and Paternalism: Rationalising Casual Labour in an Indian Company Town’, Journal of the Royal Anthropological Institute, vol. 18:4, 2012, pp. 808–27.CrossRefGoogle Scholar

21 The First Five Year Plan Report (1951). New Delhi, Planning Commission, pp. 580–81. See also Third Plan, p. 273.

22 The gratuity scheme in ITI was introduced in January 1956 whereas the government passed the Payment of Gratuity Act only in 1972. The scheme was applicable to all employees who had worked for a continuous period of five years and who either died in service or quit the company. Initially restricted to Rs 15,000, the cap on payments was progressively hiked to Rs 350,000 by 1997.

23 Chatterjee, P., The Nation and Its Fragments. Colonial and Postcolonial Histories, Princeton, Princeton University Press, 1993, pp. 203, 205.Google Scholar

24 Ibid, p. 219.

25 Deshpande, S., ‘Imagined Economies: Styles of Nation Building in Twentieth Century India’, Journal of Arts and Ideas, vol. 25–26, 1993, pp. 535.Google Scholar

26 Parry, J., ‘Lords of Labour: Working and Shirking in Bhilai’, in Parry, J., Breman, J., and Kapadia, K. (eds), The Worlds of Indian Industrial Labour, New Delhi, Sage, 1999, p. 133Google Scholar; Parry and Strümpell, ‘Desecration of Nehru's “Temples”’; Strümpell, C., ‘Conviviality and Periphery: The Social Life of Industrial Workers in South Orissa’, in Berger, P., Hardenberg, R., Kattner, E., and Prager, M. (eds), The Anthropology of Values. Essays in Honour of Georg Pfeffer, New Delhi, Pearson, 2010, pp. 104–19.Google Scholar

27 Committee on Public Undertakings (1972). Personnel Policies and Labour Management Relations in Public Undertakings (Fifth Lok Sabha, 17th Report), New Delhi, Lok Sabha Secretariat, p. 56. See also Report of Study Group on Labour Problems in the Public Sector, New Delhi, National Commission on Labour, 1968, p. 11.

28 Interview with Srinivasa Rao. Emphasis added.

29 Money wages as a percentage of total output in all industries had declined from 13.7 per cent to 9.7 per cent between 1952 and 1964, while wages as a percentage of value added to manufacture fell from 50 per cent in 1949–50 to 36.5 per cent in 1964. Report of the National Commission on Labour, New Delhi, Ministry of Labour, 1969, pp. 224–25.

30 Capital expenditure on the township as a proportion of total capital expenditure stood as high as 37.5 per cent at ITI, whereas in other Bangalore-based public sector firms the figure did not exceed 32 per cent. Report on Labour Problems in the Public Sector, pp. 97–101.

31 A similar reference to ‘fixed bureaucratic procedures’ (p. 232) with regard to housing allocation at Bhilai can be found in Parry, ‘Nehru's Dream’.

32 See, for instance, Gitelman, H. M., ‘Welfare Capitalism Reconsidered’, Labor History, vol. 33:4, 1992, pp. 531CrossRefGoogle Scholar; Licht, W., ‘Fringe Benefits: A Review Essay on the American Workplace’, ILWCH, vol. 53:1, 1998, pp. 164–78.Google Scholar

33 The Soviet welfare regime, for instance, sanctioned drunkards heavily by either allocating no sickness benefits to these workers or paying just half the normal rate when they had families. Madison, Social Welfare in the Soviet Union, p. 202.

34 National Commission for Enterprises in the Unorganised sector Definitional and Statistical Issues, Task Force Report, New Delhi, 2008, p. 69; J. Parry, ‘Company and Contract Labour in a Central Indian Steel Town’, Economy and Society, vol. 42:3, 2015, pp. 348–374; Sanchez, A., ‘Questioning Success: Dispossession and the Criminal Entrepreneur in Urban India’, Critique of Anthropology, vol. 32:4, 2012, pp. 435–57CrossRefGoogle Scholar.

35 In January 1969 the Bangalore plant employed 245 casual workers with the figure rising to 644 three years later before dropping to 358 by 1995. An important reason for the small proportion of non-permanent employees is that, pressured by the union, management at regular intervals absorbed many of them on the permanent rolls. Thus between 1975 and 1978 alone, 646 casual workers obtained secure jobs. See Minutes management–union meeting Bangalore plant, 18 November 1978.

36 Quite a few of the Kannada-speaking workers I interviewed explicitly employed the term hakku which translates loosely as ‘rights’.

37 As Partha Chatterjee has pointed out, entitlements take on a radically altered meaning in the context of urban subaltern groups belonging to the unorganized or informal sector: they are made on ‘exceptional grounds’, and ‘even when recognised never quite become rights’: P. Chatterjee, ‘Democracy and Economic Transformation in India’, EPW, vol. 43:16, 2008, pp. 53–62 (cit. p. 58).

38 Hobsbawm, E., ‘Introduction: Inventing Traditions’, in Hobsbawm, E. and Ranger, T. (eds), The Invention of Tradition, Cambridge, Cambridge University Press, 1993, p. 2.Google Scholar

39 Interview with Govindaraju, assembly operative, ITI Bangalore plant, 15 July 2000, Bangalore.

40 Interview with Joseph, machine operative, 7 July 2000, Bangalore.

41 Personnel Department (hereafter PD) Circular No. 1059, 21 October 1965; No. 1371, 16 December 1970.

42 PD Circular No. 1108, 12 July 1966.

43 PD Circular No. 869, 1 January 1963.

44 PD Circular No. 1101, 9 May 1966.

45 PD Circular No. 1182, 9 January 1968.

46 Report of the Committee on Labour Welfare, New Delhi, Ministry of Labour, 1969, p. 231. See also First Plan, p. 522.

47 PD Circular No. 1754, 17 September 1975. If ITI implemented family planning measures at the urging of the government, the impetus at the Tata steel plant, which undertook even more vigorous efforts in this domain, came directly from J. R. D. Tata, a zealous believer in population control. Kling, ‘Paternalism in Indian Labor’.

48 PD Circular No. 1371, 16 December 1970.

49 PD Circular No. 1131, 1 December 1966.

50 PD Circular No. 1754, 17 September 1975.

51 PD Circular No. 1780, 6 January 1976.

52 Replies to Ministry of Labour questionnaire, 1976, ITI Personnel Dept. files.

53 ITI Corporate Office Circular No. 52, 27 August 1980.

54 The management at the state-run Durgapur Steel Plant apparently treated family planning seriously only during the Emergency years. Crook, N., India's Industrial Cities: Essays in Economy and Demographics, New Delhi, Oxford University Press, 1993, p. 108.Google Scholar

55 PD Circular No. 1967, 14 October 1978.

56 PD Circular No. 2561, 17 October 1984.

57 Between 1976 and 1979, of the 682 sterilizations performed, 629 were tubectomies, and between 1989–90 and 1994–95, 549 of the 561 sterilizations (Source: PD files).

58 Basu, A., ‘Family Planning and the Emergency: An Unanticipated Consequence’, EPW, vol. 20:2, 1985, pp. 422–25.Google Scholar

59 Boltanski, L. and Thévenot, L., De la justification. Les économies de la grandeur, Paris, Gallimard, 1991, pp. 137–57.Google Scholar

60 According to one official report, in addition to spying on workers, watch and ward staff in many Indian companies systematically prevented trade union leaders and other such ‘undesirable’ elements from entering the townships. Report of Labour Investigation Committee, New Delhi, Government of India, 1958, p. 334.

61 Participants in the good housekeeping competition were evaluated according to four criteria: cleanliness, arrangement of household articles, furniture and decoration, and general presentation. ITI Civil Engineering Dept. Circular, nd. On the linkages between clean homes and good work practices, see also Brandes, American Welfare Capitalism, pp. 34–35; A. Tone, The Business of Benevolence. Industrial Paternalism in Progressive America, Ithaca, Cornell University Press, 1997, pp. 90–92.

62 PD Circular No. 1175, 8 December 1967.

63 Interview with V. Ramaswamy, ITI Bangalore Union General Secretary, 19 November 1997, Bangalore.

64 Interview with Vadiraj Hatwar, data operator, October–December 1997, Bangalore.

65 Ref. ASP:6777-K (62), 5 August 1996.

66 See Personnel Dept. notes 13 November 1985 and 27 May 1988.

67 For Bhilai see Jonathan Parry, ‘Ankalu's Errant Wife. Sex, Marriage and Industry in Contemporary Chhattisgarh’, Modern Asian Studies, vol. 35:4, 2001, pp. 783–820. On Tata see Kling, ‘Paternalism in Indian Labor’.

68 Parry, ‘Ankalu's Errant Wife’, p. 813.

69 Reflecting the variations in management practices among the different state-owned steel plants, despite their being controlled by the same holding corporation, Bhilai management refused to concede unions’ demands of making jobs heritable. At the Durgapur Steel Plant, on the other hand, Crook asserts that the different social measures, including employment for the second generation, gave the company ‘enormous control’ over the resident workforce. Just how this control manifested itself with regard to workers’ everyday lives is not explained. N. Crook, ‘Labour and the Steel Towns. The Expectations of the Second Five-Year Plan’, in Robb, P. (ed.), Dalit Movements and the Meanings of Labour in India, New Delhi, Oxford University Press, 1993, p. 348.Google Scholar For Bhilai see Jonathan Parry, ‘“Sociological Marxism”’. On the question of jobs for public sector workers’ children see also G. Heuzé, Ouvriers d’un autre monde. L’exemple des travailleurs de la mine en Inde contemporaine, Paris, Maison des Sciences de l’Homme, 1989, p. 101; Holmström, M., South Indian Factory Workers. Their Life and Their World, Cambridge, Cambridge University Press, 1976, pp. 34, 47, 139CrossRefGoogle Scholar; and Strümpell, ‘We Work Together’.

70 Sanchez, A., ‘Capitalism, Violence and the State: Crime, Corruption and Entrepreneurship in an Indian Company Town’, Journal of Legal Anthropology, vol. 1:2, 2010, pp. 165–88Google Scholar; Parry, ‘“Sociological Marxism”’; Crook, ‘Labour and the Steel Towns’.

71 ITI Township Dept. note, 11 January 1997.

72 Ref. SY/TD/34, 23 June 1997.

73 Claiming that it had received ‘continuous reports’ about a worker called Raju and his family who were ‘traffic(k)ing immoral activities right inside the Company's quarters’ (sic) and whose wife had been arrested twice on charges of prostitution, a security department report mentioned that police had recently raided Raju's house and arrested all the residents ‘including some outside women’. Security officials therefore wanted management to evict Raju so as to ‘maintain decency and dignity of other residents in our colony’. Ref. SY/TD/34, 24 May 1990. See also Ref. W/TA/E-9, 23 April 1983; Ref. SY/TD/34, 7 June 1989, 26 July 1996 (case No. 97/96).

74 PD note, 17 April 1995, 13 July 1995; Ref. T/Cen BR/Genl., 20 October 1997.

75 Ref: C/San/Gen (T) 269/3254, 9 May 1964, 17 July 1967, 20 February 1970, 23 August 1975, 8 May 1985, 2 August 1988.

76 Interview with V. Hatwar.

77 PD note, 19 August 1990 and 21 August 1990.

78 Feudalism is the term employed to describe management–labour relations at both the public sector Durgapur steel town and the privately owned Tata company town. For the former see Crook, ‘Labour and the Steel Towns’, p. 347; for Tata see Kling, ‘Paternalism in Indian Labor’, p. 71.

79 ITI Note, 8 April 1962. Declaring townships as notified areas, governed by a notified area committee, the majority of whose members were management nominees, was a common stratagem by which private and public companies alike sought to forestall local elected municipalities.

80 Karnataka Government Notification No. HUD 165 MY 91 (II), 30 June 1992.

81 Ref. CPM 5W/ITI NAC/21, 8 May 1992.

82 Ref. ASP. 18662 (40), 13 January 1972.

83 Ref. SY/FD/10, 27 April 1992.

84 PD Circular No. 2058, 1 February 1980. See also Parry, ‘Nehru's Dream’.

85 PD Circular No. 2241, 7 March 1982.

86 Ref. SY/FD/10, 18 January 1986.

87 Ref. SY/FD/10, 12 December 1996. Complaining that workers were making ‘umpteen number of . . . false claims’ for employed sons and daughters, married sons and daughters, and deceased dependants, because information concerning worker household structures had not been updated, one security department note declared that it ‘will be a herculean task to list out each and every false claim and investigate it’. Ref. SY/FD/10, 27 August 1996.

88 Ref. SY/FD/10, n.d.

89 Parry, ‘“Sociological Marxism”’; Sanchez, ‘Deadwood and Paternalism’.

90 This figure comprised only the sums incurred on non-statutory benefits; if contributions to statutory benefits such as gratuity and provident funds were also included, total welfare payments soared to Rs 4,335.45 million.

91 Minutes of union–management meeting Bangalore plant, 9–13 June 1978.

92 Minutes of union–management apex meeting, 22 and 23 February 1993.

93 Management note, 23 April 1993.

94 Minutes of 11th and 12th meeting of joint ITI union-management committee, 30 December 1993 and 29 January 1994.

95 PD note, n.d.

96 Ref. CM/27.7, 15 November 1996; Ref. DB/COR, 25 November 1996.

97 Minutes of 20th meeting of joint union–management committee, 14 May 1997.

98 PD note, 25 August 1999.

99 PD Circular No. 4371, 26 February 2001.

100 Efforts by Chinese state firms to dismantle the ‘iron rice bowl’ also proceeded in a slow and fitful manner. Hassard, J., Morris, J., Sheehan, J., Zhou, M. and Terpstra-Tong, J., China's State Enterprise Reform: From Marx to the Market, London, Routledge, 2007, pp. 110–11.Google Scholar

101 On the issue of multiple trade unionism see Ramaswamy, E. A., The Worker and his Union. A Study in South India, New Delhi, Oxford University Press, 1977, pp. 113–16, 121–26Google Scholar; Sen, S., Working Class of India. History of Emergence and Movement, 1830–1990 (with an overview up to 1995), Calcutta, K. P. Bagchi, 1997, pp. 379–81.Google Scholar A more micro-historical perspective is provided by Murphy, E., Unions in Conflict. A Comparative Study of Four South Indian Textile Centres, 1918–1939, Manohar, New Delhi, 1981.Google Scholar

102 Parry, ‘“Sociological Marxism”’; Parry and Strümpell, ‘Desecration of Nehru's “Temples”’. See also Arya, P. P., Labour Management Relations in Public Sector Undertakings, New Delhi, Deep Publications, 1982, pp. 1618.Google Scholar

103 ITI Bangalore Union Circular, 13 March 1974.

104 Olson, M., The Logic of Collective Action: Public Goods and the Theory of Groups, Cambridge, Massachusetts, Harvard University Press, 1971, p. 2.Google Scholar

105 Emphasis in original. Union Circular, n.d.

106 Though the Karnataka Moneylenders Act (1961) prescribed various restrictions on the operations of moneylenders, the law was observed only in its breach.

107 Union Circular, 13 March 1974.

108 Interview with Michael Fernandes, ITI Bangalore Union President, December 1999, Bangalore. For similar parallels between indebtedness and high absenteeism rates in the Bombay textile mills see Chandavarkar, R., Origins of Industrial Capitalism in India. Business Strategies and the Working Classes in Bombay, 1900–1940, New Delhi, Foundation Books, 1994, p. 192Google Scholar. For Bhilai see Parry, J., ‘Suicide in a Central Indian Steel Town’, Contributions to Indian Sociology, vol. 46:1–2, 2012, pp. 145–80.CrossRefGoogle Scholar

109 Personnel Dept. files. One document showed that 71 workers had borrowed money from the same moneylender.

110 Annual Report, ITI Employees Union Cooperative Credit Society, 1988–89 and 1989–90, p. 2.

111 Interview with B. R. N. Rajan, Director ITI Credit Cooperative Society, 12 February 1999, Bangalore.

112 One director post was reserved for a female employee, and another for a Scheduled Caste-Scheduled Tribe employee.

113 Annual Report, ITI Cooperative, 1996–97 and 1997–98, p. 2.

114 Members could avail themselves of five different types of loans: a surety loan of up to Rs 35,000; an education loan capped at Rs 3,000; a housing loan of up to Rs 375,000; a mortgage loan of a maximum of Rs 350,000; and a vehicle purchase loan of up to Rs 25,000.

115 Between 1990, the date of the fund's inception, and 2001, the number of beneficiaries had topped the 400 mark.

116 Annual Report, ITI Cooperative, 2001–02, p. 2.

117 Interview with M. Siddappa, Director ITI Credit Cooperative Society, 17 March 1999.

118 Net profits posted by the cooperative rose from Rs 1.3 million in 1983–84 to Rs 6 million in 1990–91 before dropping to Rs 4.8 million a decade later. Annual Reports, ITI Cooperative, various years.

119 An entirely autonomous initiative of employees, the ITI Housing Cooperative claimed to have a total membership of nearly 8,000 towards the end of the 1990s. In 1999, however, the Karnataka government, citing rampant misappropriation of funds, ordered the sacking of the cooperative's entire board of directors and appointed in its place an administrator.

120 Interview with Michael Fernandes. Emphasis added.

121 Ibid.

122 Between 1991–92 and 2002–03, 8,777 employees (non-officers and officers) took voluntary retirement from the company. The flagship Bangalore factory accounted for 81.5 per cent of the resignations. (Source: PD files.)

123 Annual Report 2001–02, ITI Cooperative.

124 As evidence of the depth of its coffers, in 2000–01 the cooperative society's total assets stood at a massive Rs 518.9 million. (Source: Annual Report 2001–02, ITI Cooperative.)

125 In his introductory essay, Van der Linden draws attention to the remarkable similarities shared by mutual aid societies in different historical and geographical contexts in terms of their characteristics and development. See Van der Linden, ‘Introduction’, Social Security Mutualism, p. 15, 19.

126 Thompson, E. P., The Making of the English Working Class, New York, Random House, 1963, pp. 418–24Google Scholar. See also Sibalis, M. D., ‘The Mutual Aid Societies of Paris 1789–1848’, French History, vol. 3:1, 1989, pp. 130.CrossRefGoogle Scholar

127 Mutualism ranks as the most elementary form of collective worker organization, asserts Lequin, Y., Les ouvriers de la region lyonnaise (1848–1914). Les intérets de classe et la république, Lyon, Presses Universitaires de Lyon (Vol. 2), 1997, p. 191.Google Scholar

128 Interview with Bhaskar, data operator, ITI Bangalore plant, 30 June 2000, Bangalore. On the prevalence of chit funds and informal credit societies among factory workers see Ramaswamy, U., Work, Union and Community. Industrial Man in South India, New Delhi, Oxford University Press, 1983, p. 36Google Scholar; and Sheth, N. R., The Social Framework of an Indian Factory, Bombay, Oxford University Press, 1968, pp. 147–48.Google Scholar

129 Interview with Narayana Murthy, technical assistant, ITI Bangalore plant, 16 June 2000, Bangalore.

130 Interview with V. P. Raju, ex-ITI Bangalore plant worker, 1 November 1997, Bangalore.

131 Interview with Bhaskar.

132 Interview with V. Hatwar.

133 Ibid.

134 While some of the more active members openly acknowledged their ties to the RSS, it was impossible to determine whether the association's activities also included the dissemination of Hindutva propaganda in one form or the other.

135 Annual Report, Aid the Ailing Association, 1994–95 and 1995–96, pp. 2–4. During these two years, the Association said it had provided assistance to 1,025 people in four Bangalore hospitals.

136 See note 122.

137 The 2012–13 annual report reported no improvement in the company's financial health but a further decline in the size of the overall workforce to 8,516 people. See http://www.itiltd-india.com/upload/Financial%20Information.html, [accessed 21 June 2014].

138 See, for instance, Jacoby, Modern Manors, pp. 70–71, 88–92; Montgomery, D., ‘Introduction: Workers’ Choices, Company Policies and Loyalties’, ILWCH, vol. 53:1, 1998, pp. 14.Google Scholar

139 For details see Subramanian, D., ‘Bangalore Public Sector Strike, 1980–1981. A Critical Appraisal’, EPW, vols. 32:15 and 16, 1997, pp. 767–78 and 843–53Google Scholar; and Subramanian, Telecommunications Industry in India, pp. 473–77, 484–531.

140 Parry, ‘“Sociological Marxism”’; Parry and Strümpell, ‘Desecration of Nehru's “Temples”’.

141 Parry, ‘Company and Contract Labour’.

142 Parry, ‘“Sociological Marxism”’.

143 Sanchez, ‘Deadwood and Paternalism’.

144 Even in the case of private firms, one could claim that paternalism as an analytical construct afforded diminishing returns once state-funded social security schemes, especially in the advanced industrial nations, progressively expanded their coverage.

145 Joyce, Work, Society and Politics, pp. 168–70.