Auto shopfloors not getting safer

Kavita Charanji, New Delhi

Leading auto manufacturers compete fiercely for a bigger slice of the Indian market, spending on advertising and lobbying for tax cuts. But inadequate attention is paid to ensuring an accident-free supply chain with decent working conditions for toiling workers. Workers are vulnerable to serious injuries, even death, due to accidents on the shopfloor. The supply chains of major auto companies continue to be hazardous.

Grievous accidents are glossed over by companies, government and the media. On March 16 this year, an explosion occurred in the factory of an auto components manufacturer called Lifelong Private Limited in Dharuhera, Haryana. The company is a supplier to Hero Motors. Around 60 workers were badly burnt in the blast, of whom 19 died. Later, it was found that simple, regular cleaning of the exhaust ducts could have averted the tragedy. 

Yet it was business as usual in the factory a day after the incident. Only two arrests were made — two months later.

It was against the backdrop of this horrific incident that Safe in India Foundation (SII)’s latest report, “SafetyNiti 2024”, was released on August 9 at the India Habitat Centre.

“SafetyNiti 2024” is the fourth edition of Safe in India’s annual report which tracks Occupational Safety and Health (OSH) in India’s top 10 automobile brands. It examines policies for their supply chains and identifies gaps, opportunities, best practices and solutions.

The top 10 auto brands, in terms of their net sales, that come under the report’s scanner are Ashok Leyland, Bajaj, Eicher, Hero, Honda, Hyundai, Mahindra, Maruti, Tata and TVS.

The findings of SII’s painstakingly collated report are based on analysis of documents in the public domain related to the OSH policies of these 10 brands. The report assesses to what extent the brands have committed themselves to improving OSH standards in their own factories and in their deeper supply chains. 

The report advocates greater safety standards. It puts forth key recommendations to all stakeholders — automobile manufacturers, apex industry organizations such as Automotive Components Manufacturers Association of India (ACMA), Society of Indian Automobile Manufacturers (SIAM)and ESG (Environmental, Social and Governance) auditors and investors.

Workers continue to be grievously injured on shopfloors

There are sections too on a model Supplier Code of Conduct (SCoC), an assessment of the new Business Responsibility and Sustainability Report (BRSR) submissions to the Securities and Exchange Board of India (SEBI) by the top eight auto brands, and recommendations for non-financial auditors and financial investors.

Twenty-one parameters have been used to gauge shopfloor safety standards.  They look at, among other aspects, whether a brand has a publicly declared OSH policy for its own factories and whether it monitors and reports accidents and worker injuries in its Tier 1 and Tier 2 supply chain even if it is not doing so currently in the deeper supply chain. Questions also revolve around whether the brand has a grievance redressal mechanism for workers to report unsafe working conditions in its immediate Tier 1 and 2 supply chains even if not in the deeper supply chain.

Tier 1 are direct suppliers to the auto company. Tier 2 are suppliers to the Tier 1 supplier. Then comes the deeper supply chain.   

The report finds a trend of continuing improvement mostly in policy rather than on the ground, particularly in the brands’ deeper supply chains. For instance, six auto brands now treat their non-permanent workers on a par with their permanent workers in terms of OSH policies. Eight auto brands have their Supplier Code of Conduct in the public domain though, at the moment, it is applicable mostly to Tier 1 suppliers.

However, none of the automobile brands seems to have a Standard Operating Procedure (SOP) or a comprehensive OSH implementation plan for the deeper supply chain. They are equally lax when it comes to monitoring whether even their Tier 1 suppliers enable workers to get letters of employment or ESIC registration, or report accidents and injuries in the workplace.  

Reflective of the industry’s casual approach to worker safety are the thousands of injuries that take place on the shopfloors of supply chains every year. SII found over 2,000 serious disabling injuries annually in the auto components factories in three districts in two states. Most of these workers, largely contractual young migrants, are highly exploited. They earn less than `15,000 for
12-hour shifts, six days a week, with overtime not paid at legal rates.

“Can Indian manufacturing, especially the automobile sector, professionalize with such disregard for workers, their families and their dignity?” asked Sandeep Sachdeva, co-founder and CEO of SII, at the launch of its recent report.

The fact is, he pointed out, that “these workers’ lives are cheap, their safety is inconvenient and their families’ lives are dispensable”.

The irony is, pointed out V.N. Saroja, senior adviser, SII, that the automobile manufacturers have all the clout they need to improve workplace safety.  The sector contributes about seven percent of India’s GDP and 35 percent of its manufacturing GDP. The companies wield enormous influence over their supply chains, which depend on them for their entire business. Moreover, they are in a strong position to influence government policy and implementation of those policies.

The annual SafetyNiti reports, it is hoped, will motivate the top auto brands to get their act together and set in motion measures to improve worker safety standards in their supply chains. Greater accountability from the industry is long overdue.