Our mutual value is for us the value of our mutual objects. Hence for us, man himself is mutually of no value. — Karl Marx
THERE’S quite a bit of information available if you wish to learn about the state of our country’s various industries. The origin, growth, material assets and level of technology, capital investment and revenue generation, production, sales and profit margin, constraints and challenges, vision and policies of each industry are documented, debated and analysed.
You may also find some academic research on a specific industry. What would elude you —almost entirely — is any clue about the workforce itself: those who manufacture the product and make the industry. The narrative of industrial growth, stagnation and decline seems to be without a human face.
You come to know about the workforce only when they are laid off in high numbers, as has been the case with the automotive industry. Since July, news has trickled in of non-productive days and workforce reduction in the sector. In the industrial narrative, only the word ‘layoffs’ implies the presence of human beings. We are sometimes given estimates and projections of layoffs, but learn nothing else about the people who are being ‘laid off’.
Who are these people? How are they coping with unemployment? How many of them are being absorbed in other sectors? Apparently, the key players have little interest in such questions.
What do we really know about those being ‘laid off’?
Pakistan’s auto sector employs a workforce of over 1.8 million directly and 3.5m in ancillary production. There are about eight to 10 major, formal, multinational auto assemblers (ie, Toyota, Honda, Suzuki) with a number of plants with labour-intensive assembly workshops rather than modern assembly lines. Some 2,000 SMEs make auto parts for the local market. Of these, only 400 operate in the organised sector.
Blue-collar workers in the auto industry generally have 10-14 years of schooling. Basic recruitment is done through the Apprenticeship Ordinance, 1962. By law, apprentices are inducted on a monthly stipend of less than minimum wage. Permanent workers’ salaries range from Rs16,000 to Rs45,000. Contract workers receive lower wages and few (or no) benefits even though, under labour laws, they are also entitled to social security, minimum wages, overtime, compulsory holidays and group insurance.
The auto firms tend to employ a small core team on a permanent basis, and hire a larger peripheral workforce on contractual terms through formal sector manpower outsourcing companies. Manpower supply firms capture only 5pc of the market in contractual hiring: informal labour contractors do 95pc of the hiring.
The auto assemblers vary in their treatment of workers. A few hire about 20pc of their workforce on contract and the remaining 80pc as permanent. In some cases, it is the other way around. Manpower suppliers claim that they register contract workers with the state-run labour welfare institutions. But a source shares that just 2pc of the entire population of workers in Karachi’s Korangi industrial area are registered with the EOBI.
Firms (in both the formal and informal sector) use various tactics to subvert laws. According to the law, a person who works for more than three months becomes a permanent worker. But companies tend to fire a worker after 89 days only to then rehire the same person. The worker gets a new card with a new code number. This practice may continue for years.
Even worse treatment is meted out to workers concerning their right to form trade unions. Contract workers cannot form a union or be part of the trade union formed by the permanent workers in that establishment due to legislative and administrative constraints. Trade unions with collective bargaining agency are allowed by big auto-assemblers, but with curtailed power.
Working conditions are better in the MNCs, but not in every firm. Workers at one well-known car battery manufacturer told this scribe of the pathetic work conditions in the factory area, where workers are exposed to acid and lead-laden particles. Many suffer from abdominal pain, nausea, vomiting, anaemia and high blood pressure.
Labour relations in the country are very complex. The mix of informality, lack of transparency, legislative gaps and lacunae, poor governance, lack of capacity in labour welfare institutions and corporate chicanery puts up insurmountable hurdles and pushes labour — an important player in industrial relations — to the depths of vulnerability.
Industrial policies ignore human resources development and industrial relations. The Automotive Development Policy (2016-21), devised after consultation with the auto industry, auto parts manufacturers, consumers and relevant government organisations, did not include labour as a crucial stakeholder.
The workers bear the brunt of the decline in production. They have no back up, no support network, no allies — and no one speaks for them.
The writer is a researcher in the development sector.
Published in Dawn, November 26th, 2019