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Holcim Defies High Court Order on Rights for Contract Workers

Written By krishna on Friday, August 05, 2011 | 10:06 PM

Bhagirath Verma, a laborer in Holcim ACC cement factory says High Court gave an order in March to regularize 169 workers and we are sitting on a dharna from 3rd April to implement that order but no one has listened to us. He says Holcim gives Rs 2400 per day to a worker in its plants in Switzerland but gives Rs 170 in India.

Holcim Defies India Court Ruling on Rights for Contract Workers


A long and drawn out court battle in Chhattisgarh state, India, saw exploited contract workers of Holcim Cement again win regularisation of their jobs in March through a High Court appeals ruling. But Holcim Cement of Switzerland is refusing to implement the court’s order.

The result is that hundreds of contract workers at one of Holcim’s Indian subsidiaries, Associated Cement Co. Ltd. (ACC), and supporters are staging an ongoing “dharna,” or strike at the Bhilai Industrial Estate statue of Shankar Guha Niyogi, the legendary workers’ leader and founder of the Chhattisgarh Mukti Morcha (CMM) political party who was assassinated in 1991.

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Shankar Guha Niyogi

The CMM-associated labour union Pragatisheel Cement Shramik Sangh is carrying the struggle for the contract workers, much like Niyogi did for irregular workers in mining, metalworking, and textiles three decades ago.

The rightful fight for contract workers at ACC Jamul Cement to gain full wages, provident fund benefits, and even proper safety equipment dates back nearly 20 years. Holcim bought controlling interest in ACC and Ambuja Cement in 2006-2007 and has continued resistance to the legitimate rights of contract workers at its Indian cement plants.

In 2006, an Industrial Court ruled that some 573 contract workers at ACC Jamul, many subsequently fired, must be made regular employees, with their wages and working conditions tied to the Cement Wage Board, or the Nevatia Award. Holcim, Lafarge, the Aditya Birla Group’s Ultratech, and other major cement producers are tied to the Wage Board by hard fought strikes of the past.

The Wage Board agreement has tight restrictions on the use of contract labour, limiting it to loading and unloading raw materials but with pay at the same rate as permanent workers.

Holcim defied the Industrial Court’s ruling by paying only between two-to-five days salary per month – at US$2 per day – because that is how few days contract workers were on the job at the time of the Industrial Court filing because Holcim was trying to get them to resign.

Pragatisheel Cement Shramik Sangh filed a writ petition with the High Court, and that portion of litigation is still pending. However, on 21 March, the High Court did rule that the paper arrangements between irregular workers and Holcim are “sham and bogus” and directed management to regularise over 100 contract workers. However, the ruling neglected to recognise the rights of about 400 who were coerced into accepting voluntary resignations.

India is the world’s second largest cement producer behind China. The country has an annual growth rate in cement of 11%, which has seen the leading cement producers make major investments and acquisitions.

But multinationals like Holcim and Lafarge are doing nothing to stabilise employment and bring decent work to rural people who are recruited and then exploited as contract workers. Alone in Chhattisgarh state in central India, it is estimated that 3,200 permanent workers are employed in the cement industry, while 11,000 others toil as short-term, expendable contract workers.

Cement workers fighting for their rights

Company consistently violated tenets of Cement Wage Board Award

ACC says it is studying the court ruling and examining options


Durg: Every evening about 500 workers shrug off the exhaustion of an eight-hour shift to protest outside the premises of ACC Ltd.'s Jamul cement factory in Durg, Chhattisgarh. Closed fists swing rhythmically to chants of “Inqilab zindabad,” as factory veterans who have been protesting for 20 years stand beside young men with little more than two years of work experience.

One of India's largest cement manufacturers, ACC Ltd. was acquired by Swiss cement giant Holcim in 2005 via a transaction routed through Ambuja Cement Pvt. Ltd. Holcim currently promotes both ACC and Ambuja Cements.

“We are demanding that the management comply with the directions of the High Court and regularise us,” said Rajkumar Sahu of the Pragatisheel Cement Shramik Sangh (PCSS), shielding his eyes from the slanting five o' clock sun. Mr. Sahu said he had been a contract worker at ACC's Jamul plant since 1989 and had been pushing for regularisation of workers since 1991.

Twenty years after the workers began their protests, the Chhattisgarh High Court directed the ACC to provide permanent employment to members of Mr. Sahu's union in March this year. Workers say the High Court's directions are yet to be implemented. ACC spokesperson Nand Kumar said the company was still examining the repercussions of the ruling.

An agreement between Indian cement manufacturers and trade unions prohibits the use of contract labour in the cement industry in any sector except for packing and loading and mandates that even such contract labour must be compensated at the same rates as regular employees.

However, workers say that ACC has consistently violated the tenets of the Cement Wage Board Award of 1983. “The company is using contract workers in all aspects of production in the Jamul plant,” said Mr. Sahu, “I have been working for 20 years, but my salary is the same as a worker who joined yesterday.” Mr. Sahu says most contract workers are paid the minimum wage of Rs. 151 per day.

Old timers say the struggle for permanent work began in 1990 under the leadership of trade unionist Shankar Guha Niyogi. Although Mr. Niyogi was killed in 1991, cement workers from factories across Bhilai and Durg embarked on a series of demonstrations that culminated in the Bhilai police firing in 1992.

“In June [1992] workers would gather at a place and hold a demonstration, the next day more would join us and we would move a little way down the road and hold another meeting that evening,” said Ramadhar Gandharv, who has been working as a contract worker since 1981. “It went on like this for one month until we covered the 7 km stretch from the Ravanbhata labour to the rail line.” Mr. Gandharv said the workers were demanding the implementation of the 1983 wage board agreement and the regularisation of contract workers involved in the production process.

On July 1 1992, workers squatted on the Mumbai-Howrah railway line only to be fired upon by the police. Workers say 15 workers died that day, three of whom were from ACC's Jamul plant.

In 2000, the dispute between PCSS and ACC Jamul was taken up by the State Industrial Court. Workers alleged that they were actually employees of ACC, but had been shown as a contractor's employees to deny them the benefits of permanent employment. In 2006, the Industrial Court held that “all the workers under reference are the company's employees and the company has entered into fake and sham contracts to make it believe it is the contractor's employees” and directed the company to regularise the workers.

In March this year, the Bilaspur High Court partially upheld the Industrial Court's order and directed the company to employ those workers who were demonstrably part of the PCSS. “The number of workmen who come under the purview of the latest judgment is yet to be ascertained,” said the ACC spokesperson in an emailed statement, “ACC is studying the ruling and examining options available to the company.”

“It is hard to understand why a multi-national cement giant like Holcim is reluctant to regularise contract workers despite judgments of two Indian courts,” said Sudha Bharadwaj, counsel for the workers, “Today Holcim pays European workmen $8 per hour and Indian contract workers about $2.17 a day.”
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