MUMBAI Aug 3 The Indian unit of Sweden's Volvo
Bus Corp has lost about 70 million rupees ($1.5 million) in
earnings following a work slowdown orchestrated by the local
union, a company spokesman said on Tuesday.
Roughly half of the 550-odd staff at Volvo Buses India Pvt
Ltd's factory near Bangalore started the "go-slow" process in
April, and went on strike a week ago.
The workers, who are in disagreement with management over
wages, are also demanding re-instatement of four workers who
were suspended in April as a disciplinary measure, the company
"We have told them not to link the wage negotiations with
the suspension issue, which is under policy enquiry," the
spokesman said, declining to be named. "They are two separate
issues and we want to go ahead with the wage agreement, which
is one of the best in the industry."
The union could not be immediately reached for comment.
Volvo Buses, in which the Swedish parent holds 70 percent,
is a joint venture with Bangalore-based Azad Group. The factory
started operations in January 2008 and sells about 500-600
After the staff was suspended earlier this year, the
workers in the factory have been on a prolonged "go-slow"
agitation, the spokesman said. A "go-slow" process is one
wherein many employees work slower than usual while some refuse
to work at all.
LABOUR PROBLEMS ABOUND
Labour issues and strikes are not new to India. Earlier
this year, workers at Hyundai Motor's (005380.KS) India plant
went on a three-day strike over dismissal of some of its
Last year Honda Motorcycle & Scooters India, a unit of
Japan's Honda Motor Corp (7267.T), saw a "go-slow" by its
workers at its plant in the northern Indian state of Haryana,
over wage negotiations and other issues.
A wave of strikes by migrant workers in major Asian
economies such as China and India has raised questions over how
these countries will preserve their status as low-cost
manufacturing bases while avoiding growing discontent among
India's labour laws are rated by the World Bank as among
the most rigid and some analysts say they hurt corporate
competitiveness in Asia's third-largest economy.
While government data for strikes this year is not
available, there is evidence they are on the rise and more
unrest may be in store as India looks to divest stakes in
overstaffed state firms to bridge a yawning fiscal deficit.
A World Bank report on the ease of doing business ranked
India 122 of 181 countries last year, and suggested that
greater flexibility in labour laws would help create more jobs
and reduce poverty.
(Reporting by Janaki Krishnan; Editing by Ranjit Gangadharan
and Jui Chakravorty)