Labour excess v/s Labour scarcity: how is the Indian apparel industry managing?

by Dheeraj Tagra

20-December-2018  |  9 mins read

Labour issue

How India’s Top exporters manage it

HR Perspective: Archana Tomar Mann, VP, Compliance, CSR, Training & Development, Orient Craft, Gurgaon

This issue depends on the systems, and varies from one company to another and even from factory to factory. There are some other factors that too play an important role with this regard. Some of our factories have an entire workforce on payroll, so there is no chance for such a situation. However, looking at the seasonal nature of the business, in few factories, we do have some workers on contract too. Since we have prestigious clients and have a better understanding and long-term relation with them, it gives us a fair idea about the amount of work we may have during the incoming season. We plan accordingly and allocate work. We also hardly see any shortage of orders, so there is no question of worker lay-off. Thus, the mindset of workers and the company’s approach towards workers are major factors to be taken into consideration while hiring and firing labour. As nearly 80 per cent workforce is migratory, they do know when and for how many days their factory will have workload or normal orders, when they will work without overtime (OT), and they plan their leaves accordingly and manage their jobs as well as their work in their villages. We have never asked any worker to leave and similarly, workers also prefer to work with us. We have many workers who have been with us since decades. The best possible solution for the industry is to keep maximum workers on payroll and focus on their welfare, CSR activities. We, at Orient Craft, are associated with almost each and every such program of buyers be it HERhealth, PACE, Gender Equality and many more. We do offer scholarships to our workers’ children to support their education, have proper focus on the health and safety of workers and such initiatives at the end of the day really matter as they help in making the workers committed towards their work as well as the factory.

Technical Professional’s Experience

Vikas Kumar, AGM- Operations, Shahi Exports, Faridabad

Our company is known for its best practices, be it HR, production, marketing or any other department. Workers feel proud to work with Shahi Exports and we do work hard for the same. Visibility of orders at the company level as well as factory level, accordingly exact balance between workflow, workers’ resignation for personal reasons and controlling the scale of hiring are some of our most important features and strategies in this regard. I must add here that most of the time, we have good orders, but in rare and exceptional cases related to supply issues or some such unavoidable reasons, the company does give salary to workers sitting idle.

Observation and suggestions for medium level exporters

Babul Singh, IE Manager, Team Krian, Noida

This kind of situation has the worst effect on a factory that has very less business for few months and in this case, they fire most of their operators. Such factories have trouble to get workers again once they start getting orders during peak season or normal months. The factory is then forced to pay OT, high wages, short-term incentives and other benefits to get workers to work on the orders. We need to see this picture from a larger perspective. In last few years, the loyalty in workers has reduced especially among the workers of Delhi-NCR. Delay of even one-day salary is not tolerable by most of the workers, and similar is the approach of many factories. In case, factories don’t have work, they prefer to make the full and final payment to workers even for any small issue rather than offering him leave during that lean period.

In last two to three years, many workers who used to work in Delhi-NCR, have shifted to other apparel manufacturing hubs like Jaipur, Kanpur, Ranchi, etc. as cost of living is relatively less in these cities. Some of these hubs do have full orders from domestic markets and factories prefer to have workers on piece rate. In such cases, workers earn and save more money. So overall loyalty and patience have reduced in workers.

There are some factories who have a good strategy to get more workers during peak season or in case of extreme rush. They try to hire extra workers through their existing workers on payroll. This also enhances bonding and co-ordination among the workers. Some factories even manage to occupy their capacities by adding manufacturing for the domestic market while they always prefer export orders. Looking at all these ground realities, I must say that factories should treat their workers fairly and should try to create loyalty factor within them.

Jobwork is Also Crucial But…

Nimish Shah, Director, Amber Home, Mumbai

Proper planning and back-up or plan B is one of the best solutions to avoid such a situation. We plan for almost four to six months and work accordingly. In case of workload or less work, jobwork is an important part of our strategy. When we have rush of work or have to complete big orders and labour is not available, we use the service of jobworking factories. While when we have excess capacity, we also do jobwork for others. It sounds simple and most of the factories follow the same but we have developed a strong relationship with such factories or companies who can do jobwork for us and can give us the work required.

Whenever we have an indication of less work, we put extra effort to get more orders so that machines do not remain idle and there is no negative impact on workers. And so far, we have remained successful as we have never asked any worker to leave due to non-availability of work. Welfare activities also play a very important role in retaining workers or in motivating them to work. It is a natural process that should be adopted because if the workers are taken care by us, they do support us and prefer to work with us; this is a continuing process and not just according to our needs and requirements.

How Top Brands Do It

Jay Kumar, AGM Production, Mangla Apparels India (Crimsoune Club), Delhi

We have a factory at Kundli (Haryana) with a daily capacity of 10,000 pieces and we have never witnessed any kind of worker shortage or abundance in our factory. The credit for this goes to our training efforts. There are nearly 30 experts in our training department and training is our primary focus. As per planning, we increase hiring and train people according to our requirement. We train freshers as well as experienced workers for a specific operation or to enhance their speed.

Further on-time payment, proper and timely information sharing with our jobworkers help us and the workers mutually as well as enable us to plan properly and serve each other in a better way. Despite these and few other efforts, there are chances to get orders that need to be completed on a priority basis, and for this, we do have some factories that cater on an FOB basis.

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