CASE STUDY: 1

SALARY INEQUITIES AT GANTA INDUSTRIES

Vikranth was trying to figure out what to do about a problem salary situation he had in his
plant. Vikranth recently took over as president of Ganta Industries Manufacturing. The
founder and former president, Ravikant, had been president for 35 years. The company was
family owned and located in a small eastern Arkansas town. It had approximately 250
employees and was the largest employer in the community. Vikranth was the member of the
family that owned Ganta Industries, but he had never worked for the company prior to
becoming the president. He had an MBA and a law degree, plus five years of management
experience with a large manufacturing organization, where he was senior vice president for
human resources before making his move to Ganta Industries. 

A short time after joining Ganta Industries, Vikranth started to notice that there was
considerable inequity in the pay structure for salaried employees. A discussion with the
human resources director led him to believe that salaried employees pay was very much a
matter of individual bargaining with the past president. Hourly paid factory employees were
not part of this problem because they were unionized and their wages were set by collective
bargaining.

An examination of the salaried payroll showed that there were 25 employees, ranging in pay
from that of the president to that of the receptionist. A closer examination showed that 14 of
the salaried employees were female. Three of these were front-line factory supervisors and
one was the human resources director. The other 10 were non-management. 

This examination also showed that the human resources director appeared to be underpaid,
and that the three female supervisors were paid somewhat less than any of the male
supervisors. However, there were no similar supervisory jobs in which there were both male
and female job incumbents. When asked, the Hr director said she thought the female
supervisors may have been paid at a lower rate mainly because they were women, and
perhaps Ravikant, the former president, did not think that women needed as much money
because they had working husbands. However, she added she personally thought that they
were paid less because they supervised less-skilled employees than did the male supervisors.
Vikranth was not sure that this was true. 

The company from which Vikranth had moved had a good job evaluation system. Although
he was thoroughly familiar with and capable in this compensation tool, Vikranth did not have
time to make a job evaluation study at Ganta Industries. Therefore, he decided to hire a
compensation consultant from a nearby university to help him. Together, they decided that all
25 salaried jobs should be in the same job evaluation cluster, that a modified ranking method
of job evaluation should be used, and that the job descriptions recently completed by the HR
director were current, accurate, and usable in the study. 

The job evaluation showed that the HR director and the three female supervisors were being
underpaid relative to comparable male salaried employees. 

Vikranth was not sure what to do. He knew that if the underpaid female supervisors took the
case to the legally, the company could be found guilty of sex discrimination and then have to
pay considerable back wages. He was afraid that if he gave these women an immediate salary
increase large enough to bring them up to where they should be, the male supervisors would
be upset and the female supervisors might comprehend the total situation and want back pay.
The HR director told Vikranth that the female supervisors had never complained about pay
differences. 

The HR director agreed to take a sizable salary increase with no back pay, so this part of the
problem was solved. Vikranth believed he had for choices relative to the female supervisors: 

1. To do nothing. 

2. To gradually increase the female supervisors salaries. 

3. To increase their salaries immediately. 

4. To call the three supervisors into his office, discuss the situation with them, and jointly
decide what to do. 

Questions 

1. What would you do if you were Vikranth? 

2. How do you think the company got into a situation like this in the first place? 

3. Why would you suggest Vikranth pursue the alternative you suggested?
 CASE STUDY 2
Team-Based Incentive Rewards
Network Cable, Inc., operates throughout the central and southern portions of Florida’s east
coast. With approximately 43,500 subscribers, the company is a service provider for cable
TV and high-speed Internet connections.

Network Cable operates in an area described as a “high-growth market.” In January 2001,

Tara Gilbert, vice president of human resources for Network Cable, convinced company
president and CEO Jeff Lesitner that restructuring the organisation workforce into teams
would benefit both Network Cable and its employees. Cost savings, improved morale, and
team synergy were cited as inherent benefits of teams. Based on these assessments, in June
2001, a select group of three senior managers, plus Tara Gilbewrt and the company’s
financial officer, implemented teams within the company’s installation department. Here,
forty installers were formed into eight teams of five installers each.

Management set performance goals for the installation teams linked to attractive incentive
rewards (cash bonuses above base salaries) when performance goals are reached.
Performance measures included indexes for improved installation time, customer satisfaction
scores, additional sales, equipment maintenance, and repair/callback problems.

Each team could earn incentive bonuses up to a maximum of $15,000 annually with cash
bonuses shared equally by each team member – a possible cash reward of $3,000 for each
installer. Team bonuses after the first years were as follows: two teams, $15,000; one team,
$12,500; one team $7,300; one team, $3,150.

During August 2002, Tara Gilbert sent to all installers and their supervisors a survey
requesting feedback on the satisfaction with teams and, specifically, the incentive rewards
program. While survey results were generally positive, not all was rosy. Problems could be
grouped into the following categories:

1. Some installers believed that various team members did not “buy into” the team concept
and were simply “free riders” – average employees who benefited from the efforts of superior
employees.
 2. There was a general feeling that several teams were routinely assigned difficult
installations that prevented them from achieving high performance goals.

3. Teams did not always display the motivation and synergy expected, since “bickering” was
prevalent between average performers and super performers. Average performers complained
that high performers made them look bad.

4. A high percentage of survey respondents (29 percent) felt the incentive rewards program
was unfair and asked for a return to fixed across-the-board salary increases.

Questions 1. Management set performance goals on what basis?

Answer Management set performance goals for the installation teams linked to attractive
incentive rewards (cash bonuses above base salaries) when performance goals are reached.
2. What was the viewpoint if survey respondents?
Answer A high percentage of survey respondents (29 percent) felt the incentive rewards
program was unfair and asked for a return to fixed across-the-board salary increases.
3. Performance measures included indexes for what?
Answers Performance measures included indexes for improved installation time, customer
satisfaction scores, additional sales, equipment maintenance, and repair/callback problems
 CASE STUDY 3
Asian Polymers Ltd

Asian Polymers Ltd., reached an agreement with the Union on a production incentive
scheme to increase production. The company had an unprecedented demand for its goods and
the Union agreed for the incentive scheme. The management was pleased with the assurance
of the Union leader to personally undertake the task of implementing the scheme. The
management promised to give him a free hand if he could assist in increasing production.

The Union did increase production to almost double the original level. As a result, the Union
gained importance. Any problem could be sorted out by the Union by its direct access to the
Chief Executive. The incentive scheme benefited primarily the Union members. The scheme
was inequitable some workers got disproportionately large incentives, some low and some no
incentive at all. The second feature was that as the incentive was linked to the Consumer
Price Index (CPI), the distortion got further accentuated. However, when the Union tried to
misuse its new found powers, the management struck back one day by taking disciplinary
actions against all the leaders and the Union found all of a sudden that it was without a
leader.

Another Union arrived on the scene and the leader had established a rapport with the Chief
Executive, and this new Union faithfully followed the tenets of the management but as a price
extracted some benefits for its members exclusively. The Union saw to it that production
became its exclusive responsibility and it had a hot line with CEO for any problem solution.

As the years passed, the Union started agitating for improvement in the wage scales. Because
of the incentive scheme, the company found that any improvement in the basic wage would
pose greater problems and the primary question before the management was to delink the CPI
from the incentive scheme. The Union refused to delink the CPI from the incentive scheme as
some of its members were earning an amount equal to, if not more than the salary, as an
incentive itself. At the same time workmen with no incentive and being grade barred began to
lose. And this resulted in discontentment amongst the workmen. But the dilemma could not
be resolved and this led to an explosive situation.
A third union emerged on the scene and this led to intense inter-union rivalry resulting in
indiscipline, loss of production, and violence within the factory premises, as a result of which
the company declared a lockout.

When the plant reopened after four months, the Union in power lost its credibility and the
new Union had the complete support of the workmen. The new Union leader could develop a
rapport not only with the workmen but also with the management and expected the
management to solve the problem of not having revised the wage scales for a long period.
But this was not an easy task as there were a lot of inequalities that the management wanted
to set right.

The union, though agreeing with the management, would not agree for a cut in the wage in
any manner to set right the inequalities. The Union not only wanted to cling to the beneficial
aspects of the incentive scheme but also insisted that the management somehow give an
increase in the basic wages. The management was being drawn into a vicious circle of the
incentive scheme being inequitable but when the Union’s attention was being brought to the
high incentive categories, it reverted to the low basic wage theme. The management remained
in a quandary as regards how to convince the workmen, to win over the constituency of
workmen and make managers effective and regain supremacy in production.

Questions

1. Identify the problems and their causes in this case.

2. Under the given situation, how are the problems to be remedied?

3. Suggest various principles and strategies the management has to keep in mind while
formulating a wage incentive scheme for the employees.
 CASE STUDY-4
Panda International
Mohan Panda, a bright young M.B.A., fresh from Affinity Management Institute, one of the
top management institutes, took over his father’s responsibilities as president of Panda
International, a manufacturing unit in Orissa. The company which is situated at Rourkela is a
major industrial unit which manufactures electrical equipments. The company employed
approximately one thousand people in the production division. It had never laced with a
demand for collective bargaining. So far as was known, none of its employees were union
members.
The company enjoyed wide reputation for its product quality, customer dealings, distribution
networks and above all its people friendly approach. Majority of employees were highly
satisfied with company’s HR policy as well as wages and benefits offered to them. The wages
offered by the company was so far best in the locality. The working condition was conducive
for employees which had earned laurels for the company. Recently two major players in the
electrical equipment segment started two major units at Rourkela and offered better wages to
employees including prospective employees from Panda International. Some of the existing
employees also joined in those units.
The new president, after three years of climbing the ladder to his position, had a conference
with three long-term employees, who explained that they and their associates had been
discussing the desirability of bargaining collectively. They gained through such formal
representation. The employees had not voiced any strong criticism of management, but they
had held several meetings and had invited representatives of a national union to talk with
them. They concluded that they ought to try collective bargaining and for this purpose formed
a union and enlisted a majority of workshop employees as members. The three
representatives had been elected to the bargaining committee in order to present a written
memorandum to the president with a request for collective bargaining agreement. A series of
issues carefully spelled out by the union were handed over to the president by the three
representatives.
The young executive received them cordially and listened carefully. He accepted their
memorandum and suggested that he would like to have time to study it carefully. He
proposed a meeting with them for tuesday of the following week.
When the committee members returned, the president reminded them that the company had
been careful to maintain wages and working conditions at least on a par with those in
unionised companies in the same industry and region. He expressed the opinion that the
specific proposals they had presented seemed to him quite reasonable and appropriate. The
president however expected the employees to maintain standard and raise productivity in
order to overcome competition from other industries and maintain wage parity. He had been
thinking of any of the same changes and would probably have made them without their
request. He was pleased to hand them their memorandum with a notation indicating his
acceptance. The members left, quite satisfied with the effectiveness of their negotiations and
promising to report back to him as soon as possible
One week later, the president found the same group of representatives waiting to see him.
They appeared somewhat crestfallen and embarrassed. They reported that they had gone back
to the membership, presented a full report of their discussions with him, explained. Is
favourable attitude, and recommended formal ratification of the memorandum as a new
collective bargaining agreement. After extensive discussion, when the motion for ratification
came up for a vote, a majority of the membership voted against ratification.
Questions
1. What are the problems in this case?
2. Why did the members refuse to ratify the agreement?
3. What measures do you suggest to maintain wage equilibrium and how?
 CASE STUDY 5

WAGE DETERMINATION MACHINERY OF TEA INDUSTRY IN INDIA: A CASE

OF WEST BENGAL STATE

Abstract
Daily rate of wages for tea plantation workers in west Bengal is abysmally low in comparison
to agricultural minimum wages. There are a few benefits offered by the employers apart from
the statutory benefits enshrined in the Plantation Labour Act, 1951. Consequently, many tea
workers in this state are suffering from starvation, malnutrition, debt, etc. In this backdrop, in
my present study, a deliberate attempt has been made in order to highlight the actual picture
of wage and its determination process in the tea industry located in West Bengal in India. 

Prelude
Tea is globally one of the most exoteric and economic beverages and major tea producing
nations are India, China, Sri Lanka, Turkey and Vietnam. The tea industry is one of the oldest
organized industries in India having a long historic evolution.
 
Tea is mainly cultivated in two districts of West Bengal, namely, Jalpaiguri and Darjeeling.
The two districts contribute 20% of India’s tea with Jalpaiguri producing around 15%. The
tea growing area of Jalpaiguri district is known as Dooars while Darjeeling has two areas
known as Darjeeling Hills and Terai in the plains of the district. Labour in Dooars and Terai
are mainly adivasis while Darjeeling Hills have Gorkha workers.
 
Statement of Problem
Prevailing daily wages in the tea plantations of West Bengal is Rs 105, whereas prescribed
minimum wages for unskilled agricultural workers is Rs 221. Tea plucking involves at least
some amount of skill and should be treated at least in the semi-skilled category. For the semi-
skilled agricultural activities, prevailing prescribed minimum wage is Rs 250. In that respect,
plantation workers in West Bengal get about one-third of prescribed minimum wages.
 
Literature Review
Several studies have been made of various aspects of tea industry. These are mainly on
financial and geographical aspects of tea industry. Till date, a very little effort has been made
to highlight this wage issue in the tea estates of West Bengal.
 
A brief review of those studies is mentioned here:
 
The thesis of Dr. Mita Bhadra on life and labour of plantation women workers in 1992 had
provided focus on the labourer of tea plantations. It was a sociological study on women
which dealt with the life of women workers in a tea plantation of Darjeeling district of West
Bengal. It reflected changes in the status and role of women employed in tea industry.
 
The thesis of Dr. Kanchan Sarkar titled “Study of Trade Union Organization among the Tea
Workers in Terai and Dooars Region” in 1998 has discussed the trade union movement in tea
industry in different periods. But the study does not provide the reaction of employers with
the development of trade union movement in tea industry.
 
Another study conducted by Khemraj Sharma “The Himalayan Tea Plantation Workers” in
[Link] main dimension of the study was that unlike any other areas of tea industry of the
country, the basis of trade union formation was the common ethnic bonds of the leaders
hailing from hilly region of Darjeeling.
 
A study conducted by Tessy Kurian “A Study of Women Workers in the Plantation Sector of
Kerala” in 2004 with the objective to find out the different roles of women workers in tea
plantation.
 
A study conducted by the International Labour Organization 2005, had tried to analyze the
impact of globalization on the overall tea prices in India. According to this report, the large
tea companies have been benefited to the largest extent from the fall in auction prices because
they enjoy tremendous power to push down the prices and by doing so, they take the
advantages of depressed market condition.
 
A study conducted by Lalit Premlal Tirkey on “Tea Plantation in the Darjeeling district of
India: Geoecological and Socio-Economic impacts in post-Independence period” published in
2005 by Natural Resource Institute, University of Manitoba which was conducted with the
objective to find out the evolution process of tea plantations in the Darjeeling area since
India’s Independence. This study concentrated mainly on geoecological impact arising from
development and evolution of tea plantations. It highlighted about the problems of
deforestation caused by initial clearing of teas. It has also concluded very categorically that
tea plantations are unable to provide sustainable livelihood to the communities related to
plantations in the same way as they once did.
 
So, it can be stated that there had been a very little effort to study in depth the wage issue in
the tea estates of West Bengal. The research works so far have been made by the different
scholars of sociology and social anthropology had given much emphasis on the changing
social relations of workers. But these studies have helped us to frame out objectives of the
present study. It is expected that this study will be able to throw some lights on that area
which remains either unexplored or under explored.
 
Objective
Therefore the main objective of this study is:
 
1. To critically analyze the wage rate in this state.
2. To highlight the wage determining machinery in the tea industry located in West Bengal.
 

Methodology
The study is mainly based on secondary data which was supplemented by data/information
gathered through focus group discussion in the tea estates located in West Bengal. The most
important source of secondary data is Tea Board of India. Records of Labour departments of
the State are another important source of secondary data.
 
Discussion and Analysis
Prevailing daily wages in the tea plantations of West Bengal is Rs 105. This is far below than
a need-based minimum wage. The 15th Indian Labour Conference held in 1957 had raised
the issue of need based minimum wages for all industrial workers. Subsequently, the
government appointed central wage boards for the fixation of need based minimum wages in
22 industries. These were tripartite bodies having representatives of employers’ associations,
trade unions and government. All industries had agreed that the wage would be determined
on the basis of the requirements of three consumption units. But the employers’ association
vehemently opposed to three consumption units. They argued that since there was equal
employment of male and female workers it implied that there were two earners in the family,
hence the units should be 1.5 and not three and they remained adamant to this particular
issue.
 
Meanwhile the union government had announced that if there was unanimity in decisions in
any wage board the recommendations would be implemented immediately. If there was no
unanimity in a wage board, the government would not implement any of the awards. This put
most workers in a vulnerable position because if they opposed unjustified suggestions of the
employers they would not get anything. Hence in most cases the wage boards tried to reach
unanimity in their decisions. This invariably put the management in a strong bargaining
position. This is exactly what happened in the wage board for the tea plantation industry.
Since the employers refused to budge from their demand of including 1.5 units it was
reluctantly accepted and the need-based minimum wage in the tea plantations was half of that
of the other industries. Low wages were built into the system and the workers were helpless
in this regard.

Wages in tea plantations in India and particularly in West Bengal

it is clearly evident that daily wages in Assam and West Bengal is significantly lower, not
even 50% of the wages that prevail in the tea plantations of Southern States in India. In three
Southern States, wages are declared through minimum wage notifications and wage
settlements fall outside the purview of collective bargaining. In Assam and West Bengal, on
the other hand, wages are determined through collective bargaining. But plantation does
figure in the minimum wage schedule as evident in the synopsis of minimum wages 2014,
Govt. of West Bengal given in Annexure 1. Corresponding to tea plantation row it is written
that wages are determined through agreement. Daily wages of plantation in West Bengal was
Rs 95 in December 2014 whereas the minimum wage for even unskilled agricultural work
was Rs 216 as given in the synopsis.

Wage Determining Machinery

In Assam and West Bengal, wage is determined through collective bargaining mechanism in
a tripartite forum. Representatives of planters, representatives of workers’ union and
government representatives sit together through a series of negotiations to determine daily
wage in an industry wise manner for a specified period. But it is pitiful that such labour
market institution leads to abysmally low wages. In this context it becomes important to
understand why wages and conditions of work are poor for the plantation workers in the Tea
sector of West Bengal and Assam. Employers but argue that plantations workers get many
benefits apart from monetary wages as the planters are expected to adhere to the Plantation
labour Act 1951. These are statutory in nature and outcome of legislation enacted in view of
special working conditions in plantations.
 
Moreover, even if one adds the monetary equivalent of such welfare provisions, wages as
received by plantations workers stand significantly below that of wages in similar
employment category.
 
West Bengal tea agreements
In West Bengal tea plantations, Planters’ Association is represented by CCPA (Constituent
Committee of Planters’ Association) and workers’ are represented by CCTWU (Coordination
Committee of Tea Workers Union). Wage agreement signed in the month of February 2014,
wages were enhanced by Rs 17.50 in the first year, Rs 10 in the next two years and the
agreement came into force with effect from 1st April 2014. Accordingly, wage would
increase to Rs 112.50 in the first year, 122.50 in the second year and 132.50 in the third year.
 
As per the tripartite Memorandum of Settlement dated 20 February 2015 between the tea
managements and representatives of trade unions, the nominal wage at the end of each period
along with incremental wage hike

Conclusion
Daily rate of wages for tea plantation workers in West Bengal is extremely minimum in
comparison to other tea producing states in India except Assam. In west Bengal, wage is
determined through collective bargaining. There are few non–statutory benefits apart from
the statutory benefits, still it is very hard to justify such low wages in west Bengal. One
should keep in mind, minimum wage is essentially the basic subsistence wage below it ought
not to fall. Thus prevailing tea plantation wage in this state is abysmally low.

CASE STUDY 6
Collective Bargaining by Workers of the Indian Unorganized
Sector: Struggle, Process, Achievements, and Learning
The Context This research paper attempts to review and analyze experiences of the Self
Employed Women’s Association (SEWA), a central trade union and membership-based
organization of women workers from the unorganized sector in India. The main focus of the
paper is on highlighting the SEWA strategy for using collective bargaining for decent work,
just compensation, and worker welfare. Experiences in organizing the bidi1 worker women
from the states of Gujarat, Madhya Pradesh (MP), Rajasthan, and West Bengal in India are
used to explain the SEWA intervention strategy, the process of collective bargaining, and
achievements.
In addition to SEWA documentation studies and other secondary data, focus group
discussions of bidi worker women were arranged at three locations in Ahmedabad. Forty-five
women participated and provided data on the history, status, and achievements with regard to
the unorganized sector of bidi industry in the region
. The paper begins with a brief review of the Indian unorganized sector and issues related to
women workers. This is followed by an overview of the unorganized segment of the Indian
bidi industry and an introduction to SEWA. The second part of the paper provides the
chronology of SEWA interventions in various states, mainly in Gujarat, since 1978. This
section provides an idea of the struggle of the unorganized bidi workers, the process of
collective bargaining, and achievements. The concluding part of the paper attempts to
summarize the SEWA strategy focusing on organizing and capacity building for effective
collective bargaining.
It is expected that the experiences and conclusions will be useful to readers from any region
or country who are interested in understanding how successful and effective bargaining can
be achieved by workers themselves through establishment of their own organizations and
capacity building.
Indian Unorganized Sector
 The unorganized sector in India is broadly characterized as consisting of units engaged in the
production of goods and services with the primary objectives of generation of employment
and incomes to the persons producing the goods and services. Home-based workers, street
vendors, agricultural labourers, and other miscellaneous help providers constitute the
unorganized sector of the economy. These units typically operate on a small scale and at a
low level of organization with little or no division between labour and capital as factors of
production. Home-based workers are engaged in the making of products like incense sticks,
ready-made garments, artisanal items, embroidery, food item preparation, kites, home
decoration material, etc. Street vendors include vegetable sellers, fruit merchants, and
handcart pullers, who sell toys, garments, and miscellaneous household items. The labourer
category consists of farm labourers and those processing in homes, engaged in agro-product,
household aids, etc. The unorganized sector provides income-earning opportunities for a
large number of workers. In India, 93 per cent of the workforce obtains its livelihood from
the unorganized sector. Bidi making and related operations is one of the major unorganized
occupations in India.
The Bidi Industry and Unorganized Workers The bidi industry is one of the largest employers
of workers in India after agriculture, handloom and construction, yielding an average of 1.3
million persons working per days of employment per year. As per the Annual Report of
Ministry of Labour, Government of India, 2001, the bidi industry is estimated to provide
employment to 441,100 people in the country. Although the large bidi manufacturers are
large enterprises, actual production is carried out by small unorganized units. Most of the
production of bidi is undertaken either in homes or small work sheds. Ninety per cent of bidi
workers are home-based. Thus, production of bidi is widely dispersed and often shifts from
place to place. Ninety five per cent of bidi workers are women. For these women, bidi work
is an important source of income that constitutes an average of 45 to 50 per cent of the total
family income. This shows that the unorganized sector of the Indian bidi industry has a
tremendous socio-economic significance in employment generation in India. In the Indian
unorganized sector, the bidi industry is among the few trades that are regulated by law. The
Bidi and Cigar Workers Welfare Cess Act (1966) and the Bidi and Cigar Workers
(Conditions of Employment) Act (1966) are there to protect the interests of bidi workers, and
each resulted from worker action. The minimum wage for bidi workers is fixed as a piece rate
per thousand bidis. In Gujarat, the piece rate is linked to the dearness allowance (DA), which
is further linked to the price level changes in the Indian economy. The DA revisions are
announced by the Government of Gujarat every six months.

SEWA
SEWA is a central trade union of women workers in India’s informal economy. SEWA was
founded in Ahmedabad in the state of Gujarat by Ms. Elaben Bhatt in 1972. SEWA’s main
goal was to organize informal economy women workers for full employment and self-
reliance whereby they would obtain work, income, and food security at the household level.
The organization is guided and managed in accordance with Gandhian philosophy. As a
strategy, SEWA guides and assists members in creating their own organizations such as self-
help groups (SHGs), associations, unions, cooperatives, corporate entities, and other suitable
types of organizations. SEWA builds member capacities in managing these organizations and
in working towards achieving their goals through collective bargaining and associated
activities.
Activities of SEWA are broadly categorized in two streams:
(a) membership and (b) services to members.
Membership-related activities include membership campaigns, awareness creation,
perspective building (on benefits of membership and rights and duties of members), and
capacity building. Service-related activities include support and facilitation in income
generation, savings, wealth creation, and social security. Today, with a membership base of
over 1.3 million women in over 14 districts in Gujarat and in 12 other states of India, SEWA
is the largest member-based organization of women in the country. With a history of
initiating formation of international organizations of women like HomeNet, StreetNet, and
WIEGO, SEWA has carved out a well-respected niche for itself globally. In 2011, SEWA’s
membership included 56,904 bidi workers. This included 18,870 bidi workers from
Ahmedabad, the birth place of SEWA. Traditionally, most of the bidi workers make bidis at
homes and sell to factories on a piece-rate basis. A few factories provide bidi-making
facilities to workers in the factory premises.

History of Collective Bargaining at SEWA

The creation of SEWA arose out of the need for collective bargaining. Towards the end of
the 1960s, the Women’s Wing of the Ahmedabad Textile Labour Association, which was
founded by Mahatma Gandhi, felt that the Association was not seriously attending to
women’s workers needs and demands around issues related to wages, the work environment,
the particular needs of women workers, childcare facilities, and gender bias. The Women’s
Wing tried very hard but unsuccessfully to convince the senior leaders of the Association to
address these issues. As a result, women members of the Association, feeling neglected and
disheartened, formed SEWA. After its inception in 1972, SEWA also began to organize and
build collective bargaining capacity for chindi workers, who obtain cotton strips, cuttings,
and scraps from the textile mills for use in traditional weaving projects. Today, SEWA has
created member-based organizations of agricultural labourers, vegetable vendors and other
street vendors, home-based workers engaged in making of incense sticks, ready-made
garment stitchers, embroidery workers, workers preparing food items, artisans, kites, and
labour and service providers like construction workers, head loaders, waste pickers, etc. In
addition to building worker organizations, SEWA has built these organizations’ capacities in
the various stages of the collective bargaining process. This includes campaigns for
awareness creation, organizing rallies, representation before judicial and other governmental
authorities, organizing conferences and round tables, and a variety of advocacy initiatives.
SEWA accomplishes all of this through training programs, workshops, and exposure visits. In
this process, SEWA also guides the members in use of technology – computers, internet,
mobile phones, and SATCOM (satellite communication).

Building the Collective Bargaining Capacity of Bidi Workers

GUJURAT STATE
SEWA’s interventions in the bidi industry date back to 1978 when a poor bidi worker from
Patan approached SEWA for help in her struggle with her employers. She was a
representative of bidi workers who were earning four rupees per day and whose employers
did not issue proper identity cards. These workers did not have employee status and were not
entitled to welfare benefits or any other employee benefits from the Office of Bidi Welfare.
She also complained about working and living conditions of bidi workers like herself.
SEWA’s intervention on behalf of these workers became a long, drawn-out battle. To begin
with, SEWA organized a general meeting of and started to organize women bidi workers in
Patan, followed by bidi workers in Ahmedabad in 1981. Thanks to this organized, collective
effort, the times at which the raw material was delivered to women and the finished bidis
were collected changed from night to daytime hours. In Ahmedabad, a dispensary run by the
office of the Bidi Welfare was also started for the bidi workers.

SEWA also used research to help the bidi workers in advocacy initiatives and campaigned for
provident fund coverage for them. In 1982, a general meeting of 5,000 bidi workers was
organized in the presence of the then Finance Minister of Gujarat State. A report on this
meeting was submitted by SEWA to the state government in 1983. As a result, the
government increased bidis’ price of sale to factory owners. In addition, SEWA bidi workers
formed a cooperative on their own initiative. The members of the cooperative submitted a
memorandum to the Labour Commissioner of Gujarat State detailing their problems. As a
result, the State Labour Department inspected their workplaces, soon after which the
workers’ demands were accepted, and identity cards were issued. A factory owner who had
retrenched 200 bidi workers reinstated them, compensated them, and agreed to pay them
provident fund benefits. Recognition of the efforts of organized bidi workers came in 1985
when SEWA was invited to be a member of Gujarat State Advisory Committee on Bidi
Workers. Under bidi welfare legislation, an administrative office and health center were
established in Ahmedabad. From this point on, large numbers of workers and their children
enjoyed access to benefits. 1986 marked the beginning of a new era in the history of the
unorganized sector workers’ struggle. SEWA organized a national workshop on the status of
unorganized sector bidi workers and issues affecting their employment and security at the
national Ministry of Labour. Tobacco workers from Kheda, representatives of workers’
organizations from the states of Gujarat and Karnataka, leading social workers, the Labour
Minister of Gujarat State, and the Joint Secretary of the Ministry of Labour all participated.
In 1987, the Government of India approved a housing project for bidi workers in Ahmedabad.
The Housing and Urban Development Corporation (HUDCO) provided financial assistance,
the Ahmedabad Urban Development Authority (AUDA) provided land, and the Bidi
Workers’ Welfare Cooperative bridged the gap through subsidies. As a result, 110 women
bidi workers received houses in 1993. More generally, bidi workers’ issues drew the attention
of the Government of India. The Gujarat State

Legislative Assembly took up the issue, and SEWA began national level data collection on
bidi workers. In 1989, organizations of bidi workers were started in Palanpur and Vijaypur in
Gujarat with SEWA assistance. These workers were issued identity cards for the first time.
From 1991 to 1993, SEWA organized campaigns for standard wage rates for bidi making in
all the factories in Gujarat. SEWA also initiated a group insurance program for bidi workers
during this period. 1998 -1999 provided a unique experience in collective bargaining for bidi
workers. The Gujarat High Court ordered the State Provident Fund Commissioner to carry
out an assessment of the provident fund amount payable to bidi workers. The Commissioner
called a joint meeting of 37 bidi factory owners and contractors to discuss the process of
implementing the High Court order. Throughout the discussions, SEWA organizers assisted
the bidi workers (the organizers were SEWA employees, including local team leaders and
activity coordinators who provided guidance and support to the unorganized workers and
members in organizing activities, theme-based campaigns, and collective bargaining
initiatives). As a result of the joint meeting, the Commissioner ordered provident fund
payments of 497,790 rupees to 191 bidi workers. Throughout the collective bargaining
process, SEWA guided the organized workers towards ending the existing sale-purchase
system in which factory owners bought bidis from the workers and no employeremployee
relationship existed. A research-oriented approach was also adopted to understand the
mechanism of provident fund calculations, payments, and record keeping – SEWA research
teams visited Solapur and Pune in Maharashtra State and held a meeting with the Labour
Minister of Karnataka State.

In 2001, 15,000 bidi workers in Gujarat went on strike when the employers refused to settle
minimum wage, provident fund, and workers’ welfare issues. In 2002, bidi workers who
suffered during these communal disturbances were given work as quilt stitchers with SEWA
support. This provided them with an income for sustaining their livelihoods. In 2003-04,
SEWA organized a public meeting of 2,000 bidi workers from Ahmedabad and various towns
from the north of Gujarat State to discuss and prepare an action plan for issues related to
wages, new employment opportunities, bonuses, and restarting bidi work. 2007 marked a
happy ending of the 23 year struggle of bidi workers in Ahmedabad. In 1983, 174 bidi
workers of Jivraj Bidi Works (JBW) had filed a suit for a provident fund in the Office of
Provident Fund Commissioner, Gujarat State. On November 6, 2007, the employer paid each
of the 174 workers 1.5 million rupees in provident funds. This long struggle not only
demonstrated the power of collective bargaining, determination, and patience on the part of
bidi workers, but also demonstrated SEWA’s impact (see detailed case study, Appendix II).
RAJASTHAN STATE
In 2009, SEWA started organizing bidi workers in Ajmer in Rajasthan State. Out of 10,000
bidi workers in the city, 2,200 formed their organization under the guidance of SEWA. When
the workers’ organization was formed, they were paid 45 rupees per 1,000 bidis. Thanks to
effective collective bargaining with the factory owners, the rate was increased to 52 rupees
and then to 60 rupees. In December 2010, the rate was increased from 75 to 80 rupees per
1,000 bidis. Moreover, the workers are now linked by the Rajasthan State Government with
government welfare programs for bidi workers. The employers have also issued identity
cards to the workers.

MURSHIDABAD, WEST BENGAL

In 2004, SEWA initiated organizing efforts for bidi workers in the Murshidabad district of
West Bengal. SEWA undertook joint research in collaboration with the Labour Department
of the State Government of West Bengal and Indian Tobacco Corporation. Both agencies
were interested in working for the welfare and development of women bidi workers. The
study gathered data on the socio-economic conditions and work-related status of 170 women
bidi workers from 13 villages of the district. The research showed that the workers were paid
between 31 and 37 rupees for 1,000 bidis even though the minimum wage rate in West
Bengal was 41 rupees. Research also showed the contractor would usually reject around 250
bidis that were kept but not counted in the work done. Finally, provident fund payments were
being deducted, but no one knew where the payments went. To build awareness of bidi
worker rights, three women connected with bidi workers in Ahmedabad went to
Murshidabad. They explained details of the Bidi Workers’ Welfare Act and various schemes
for scholarships to children, maternity support, identity card, insurance, sickness
compensation, etc. Soon, the research-based initiative resulted in regularization of working
hours, uniform wage rates, clarity on provident fund and benefits under various welfare
programs. More importantly, a local team was formed, and the members received training on
the significance of organization, membership, understanding members’ problems and their
solutions, and planning and monitoring. Initially, 1,141 bidi workers were organized.
Subsequently, in 2005, the SEWA Murshidabad Team set a target of 5,000 members.
SEWA’s approach in the State of West Bengal provides a good example of its use of research
as a base for action in initiatives for informal sector workers.

MADHYA PRADESH (MP) STATE

Because the forests of Madhya Pradesh (MP) are a major source of Tendu Patta,2 bidi
making is an age-old occupation and an established industry in the state. In 1985, SEWA
started its activities in MP by forming SEWA-Madhya Pradesh (SEWA-MP) in Indore. As
the first step, SEWA-MP organized at community meetings to build awareness among
workers about the Bidi Act. Later, SEWA-MP conducted training camps and organized
sammellans (conferences) to build capacity among bidi workers. In 1987, SEWA-MP
mounted a campaign to demand identity cards for bidi workers. It sent a memorandum to the
then Chief Minister of MP with copies to the Central and State Labour Ministers. As a result
of this campaign, 1,300 bidi workers were given identity cards, which entitled them to all the
benefits and legal protections provided under the State laws. The government also distributed
scholarships and uniforms to the children of the bidi workers. In the same year, as a result of
an appeal filed by SEWA-MP to the then Labour Commissioner of MP, two locked-out bidi
factories were reopened and 500 women bidi workers reinstated. The workers received
logbooks to record their daily attendance and production. Additionally, the State Government
opened a hospital for bidi workers.

In 1988, state-wide measures were taken in the interests of the women bidi workers. The
State Labour Department asked employers and contractors to issue identity cards and
logbooks to all women workers. The State Welfare Department agreed to print application
forms for all the benefit programs in the local language. The trade union started a savings and
credit programme for the women bidi workers and organized eight training camps. The
government gave scholarships to 135 children of bidi workers. The following year, SEWA
initiated formation of a Bidi Workers’ Credit Cooperative Society under the State
Cooperative Law. The wage rate was increased by 3.50 rupees per 1,000 bidis. One thousand
two hundred workers received the provident fund money due to them from the office of the
Provident Fund Commissioner. Four hundred women received training in bidi making, and
200 of their children benefited from scholarships. The State Health Department arranged for
free polio vaccines for 300 children of bidi workers at six health camps. The activities and
achievements continued. In 1990, 335 bidi workers were trained, and 15 women bidi workers
received maternity benefits. Between 1991 and 2008, SEWA-MP enlarged its geographical
spread, organizing bidi workers in the districts of Ratlam, Sanawad, Chhatarpur and
Khandwa. Meetings, trainings, and representation continued. All this resulted in increases in
wage rates, reinstatement of employment, and receipt of overdue provident fund amounts.
Tendu Patta, or awareness, campaigns, were organized in the tribal areas where the tendu leaf
collectors were living. These campaigns were organized through widespread use of media
including posters, pamphlets and audio cassettes. Altogether, 48,219 tendu leaf collectors
from eight districts participated in the awareness meetings. A total of 37,487 tendu leaf
collectors participated in the campaign for collection cards that gave them registration and
identity as tendu leaf workers. A conference of women bidi workers and tendu leaf collectors
was organized at Indore on International Women’s Day in 1989. In an important
achievement, rallies were organized in Khandwa District for resolving accommodation
problems of bidi workers. As a result, the MP Government constructed a bidi worker colony,
providing accommodation to 250 families. During 2006 and 2007, SEWA-MP ran Tendu
Patta campaigns in ten different regions of MP. This resulted in substantial awareness about
the rights of tendu leaf collectors and laws affecting their interests. Three hundred and forty
collectors received their identity cards. In the Bundelkhand district, the MP Government set
up a mobile dispensary in response to the demand from tendu leaf collectors.
SEWA’s initiative in MP was not just limited to bidi workers. Contractors who worked as
intermediaries between bidi workers and bidi factory owners also benefitted from the
organizing effort. As per the prevailing practice, contractors provide raw material to bidi
workers in their areas and then collect rolled bidis from bidi workers. It is the contractor’s
role to ensure that bidis received from the workers are of acceptable quality, bundle them,
and deliver them to the bidi factory owner, who pays the contractor a fee for the service.
Since 2005, contractors have also formed their own unions. One contractor narrated his
experiences presenting the contractors’ demands to the bidi factory owners. These demands
included raising the fee and establishing a systematic annual increase in the rate.

NATIONAL In 1996, SEWA’s work with bidi workers took shape nationally when the
International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied
Workers' Associations (IUF) organized a national meeting of bidi workers and submitted a
memorandum to the then Labour Minister, Welfare Minister, and Finance Minister at the
central government level. As a result, the central government announced the establishment of
a minimum wage and several benefit programs for the benefit of bidi workers

ACHIEVEMENTS AND LEARNING

In its nearly 35 year history of organizing bidi workers, SEWA has been instrumental in
achievements that have made a lasting impact on the work and lives of workers in the
informal sector. An employeremployee relationship has been established, identity cards
issued, and service conditions formalized. Apart from increases in wage rates and
implementation of provident fund rules, undesirable practices in work measurement have
stopped. This has resulted in more just compensation to workers. More importantly, bidi
worker women have received maternity benefits, access to better healthcare facilities, and
other welfare benefits. These achievements have also provided learning opportunities that
should be of interest to other organizations of poor home-based workers and employees
particularly in developing countries.
These are summarized below.

 Collective bargaining by itself is not the goal. It is a skill-based organized effort and a
powerful tool that leads to poverty alleviation and women’s empowerment.

 Workers from successful unions have a significant role to play in enhancement of unionized
efforts. Such workers can directly contribute to improving effectiveness of collective
bargaining and capacity building.
  Effective collective bargaining is not just limited to employees’ initiatives. Employers and
government officials also have a role in the process. Therefore, their education and exposure
assume equal importance. Achieving this is a real change.

 It is necessary that organizations in the roles like SEWA provide handholding support to
workers’ organizations and then withdraw from the scene in a phased manner.  Initiating
collective action in an unknown territory should be seen as a normal feature in collective
bargaining. Winning confidence of the bidi workers and their families was a key to success
Involvement of government officials and political leaders is a complicated issue; workers
have to gain knowledge and skill to be able to involve them.

 For sustainable collective bargaining, it is necessary to sustain motivation and interest in

the process of negotiations. From this perspective, it is necessary that leaders are developed
from the grassroots level workers.

 Collective bargaining requires a lot of strategizing. This strategizing needs to be done in the
participatory process with the workers.

 SEWA’s decentralized structure of campaign teams, trade committees, and representative

meetings makes collective bargaining possible.  SEWA combined need-based and campaign
approach helps in strategizing, which further leads to collective bargaining.

 SEWA was able to apply learning from the bidi trade regarding the minimum wage to
incense stick workers, and for the first time, the minimum wage was established through a
tripartite process with the employers’ association. This led to wage standards, increased
wages for workers, and the development of trust between the employers/contractors and
SEWA.  SEWA was able to lobby with the Labour and Employment Department to
constitute a welfare board for urban informal sector and frame welfare programs based on
what it had been able to achieve with the bidi workers.

 The benefit programs developed for the bidi workers, especially related to the scholarship,
attendance and uniform benefits, led to an increased percentage of education among children
of bidi workers, thus reducing child labor.

 The protective legislation for bidi workers helped in the overall development of the
workers and their families. SEWA tries to apply this learning in other sectors.

Conclusion
Data provided by women bidi workers in focus group discussions and the situations
prevailing in states of MP, Rajasthan, and West Bengal provide ample evidence of the
struggle of poor working women from the unorganized sector. The case study of Jivraj Bidi
Works provides a good example of the struggle, the process of negotiations, and the
achievements of the organized workers.
 SEWA experience has shown that the bidi workers’ struggle is not just limited to wages,
working conditions, and welfare. An effective intervention can ensure decent work, full-time
employment, and building of income and savings. Secondly, the struggle must involve more
than just the bidi workers and factory owners. Suitable government policies, their efficient
implementation and support of workers’ family members also contribute considerably to
reducing conflicts.
According to SEWA ideology, collective bargaining calls for organized effort of workers
supported by guidance from a facilitator institution. Experience has shown that creating
organizations of workers must be the first step, which must be followed by capacity building
through trainings, workshops, exposure visits, seminars, and conferences. Apart from
bargaining skills and processes, the capacity building initiatives focus on understanding of
SEWA ideology, the need to follow Gandhian values, and leadership development.
SEWA experience also shows that research helps in understanding the dynamics of a local
situation. The strategy for organizing workers and for collective bargaining must be based on
research findings. In Patan, a single bidi worker triggered the initiative. Understanding of the
situation was gained through exploratory research. In Murshidabad, a formal survey was
conducted before developing the strategy for organizing. Experience has also shown that
local leaders must be identified and involved in conducting the research and in post-research
initiatives. In this context, the practice of organizing general meetings of all workers has
helped in identification of local leaders and their involvement in planning and implementing
collective bargaining initiatives. This has also assisted in ensuring maximum participation of
the workers’ community. Focus on awareness creation campaigns has equally helped in
maximizing community participation.
SEWA has always perceived government agencies and government schemes as a base in
efficient collective bargaining. The strategy for negotiations is framed within government
rules and regulations. Similarly, projects and schemes announced by the government for
workers are used for justification of workers’ demands.
Finally and most importantly, throughout the process of intervention planning and
implementation of collective bargaining, SEWA’s direct bargaining demonstrates perfect role
clarity. Meetings are organized and negotiations are planned by workers themselves.
Representation before government officials and various agencies are also managed by
workers. SEWA organizers provide guidance and build workers’ capacity in various
dimensions of collective bargaining. This also underlines the need and relevance of worker
education, training, skill building, and exposure.

Appendix I
Details of Focus Group Discussions with Bidi Workers Focus group discussions were
organized at three locations in Ahmedabad viz. Vadaj, Noble Nagar, and Ansooya Nagar on
September 26, 2012, September 28, 2012, and October 1, 2012 respectively. The group
discussions were attended by 45 women bidi workers and contractor women from various
locations where home-based bidi making is being done. These workers and contractors have
been associated with SEWA in organizing bidi workers since 1978.
In addition to experience in collective bargaining process in Gujarat, many of them have
visited other states for the purpose of organizing bidi workers and assisting in collective
bargaining. The issues discussed mainly focused on the past scenario in Gujarat, the history
of collective bargaining, challenges faced, and achievements. Those with experience in other
states were asked to provide information on the intervention and outcome. Similarly,
contractor women provided information on their experiences as a link between bidi factory
owners and bidi workers.

Appendix II
Jivraj Bidi Works:
Bidi Workers’ Struggle of 23 Years for Recognition as Employees
Jivraj Bidi Works is a relatively large bidi manufacturing and marketing organization located
in Gomtipur area of Ahmedabad City of Gujarat. In 1983, bidi workers of Jivraj Bidi Works
(JBW) filed a suit for a provident fund in the office of the Provident Fund Commissioner.
One hundred and seventy-four bidi workers were trying to prove that there was an employer-
employee relationship. The workers did not have any evidence to prove their claim. The JBW
owner took back the logbooks he had issued to workers. But one woman was not at home and
therefore still had her logbook, which became significant evidence in the case.
The case proceedings took place in the office of the Provident Fund Commissioner. The
workers could not prove an employer-employee relationship. SEWA assisted the workers in
filing an appeal in the Gujarat High Court in 1989. During this period, a change was made in
the Provident Fund Act and the case was transferred to Appellate Tribunal in Delhi. Here the
employer-employee relationship was established and the Provident Fund Commissioner
issued an order to calculate and determine the amount owed. One thousand two hundred
workers received provident fund money due them from the office of the Provident Fund
Commissioner. In 1998, JBW filed an appeal in Gujarat High Court. The High Court set aside
the appeal and ordered provident fund calculations as per the Delhi Appellate Tribunal. An
amount of 479,960 rupees was ordered, but the concerned workers filed an appeal on March
18, 2007. SEWA and JBW jointly came to an agreement, after which JBW deposited 479,960
rupees in the provident fund office. The Bidi Trade Committee of SEWA calculated the
amount of 1,020,040 rupees on the basis of the duration of work and number of bidis made
by the concerned 174 bidi workers. This was a mammoth exercise, and interestingly, the
owner of JBW joined in the calculation process and accepted the amount determined by the
Committee. It took 23 years to prove the provident fund claim of the workers. At last, on
November 6, 2007, the 174 bidi workers received their provident fund payments of 1.5
million rupees.
The unique feature of the celebration in SEWA was that the owner of JBW himself attended
the celebrations along with his family members. During the celebrations, he announced a plan
to give one of his buildings in the Gomtipur area of Ahmedabad for bidi worker training and
declared a revised wage rate of 50 rupees per 1,000 bidis – an increase of six rupees per 1,000
bidis.
This incident shows the power of collective bargaining, determination, and patience on the
part of bidi workers as well as the power of the role played by SEWA.