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SafetyNiti 2021: How can the auto-brands prevent thousands losing their hands/fingers?

Dear well-wishers of Indian workers Since starting the worker accident prevention initiative in 2018, we have published our annual series of CRUSHED reports with on-the-ground evidence, reasons for these injuries, and our recommendations. Over the past three years, we have incessantly reached out to the auto-sector brands' boards, their industry bodies (SIAM, ACMA), the government and its worker-related agencies (DG FASLI, ISH), and many others (eg. MSME Industry, BIS) to agree actions. Many of them have agreed to act and we continue to follow up, with varying degrees of success. It’s obviously a complex issue but solutions are in sight and possible.

To advance the understanding of this issue, that results in untold miseries to men and women, and loss to Indian productivity; we have now released a new report - SafetyNiti 2021 - our first on the work-safety policies of top 10 auto-sector brands, for their supply chain workers. We found these policies grossly inadequate. The full report is here.

We are grateful to SIAM (Society for Indian Manufacturers Association) and ACMA (Automotive Component Manufacturers Association) – the two auto-sector apex organisations – to have hosted the release of the report and their commitment to act. The Indian government factory-safety executive, Maruti, two Tier 1 suppliers, and an accomplished B&HR expert, also joined us to discuss the issue, best practices and solutions possible to prevent these injuries. They all made the case that “worker-safety is good for both workers and the business” and committed to work with us to solve this problem:

Here is our 7-min video presentation on the findings of the report:

A. Our top 5 recommendations to the 40+ Indian auto-sector brands:

1. The contract workers in your own factories should have identical OSH (Occupational Safety and Health) policies as your permanent workers. There is no reason for them to be worse off, especially as you grow their numbers - most of you have been replacing permanent workforce with contract workers, who now form the majority (c.50-70%) of work-force in most of your factories. Most of them also appear to be not part of any union(s) protecting their rights. As half the Indian manufacturing sector, you are contributing to increasing precarious nature of Indian workers' lives.

2. Create, and make available in public domain, a Supplier Code of Conduct (“SCoC”) including OSH, ideally as a subset of your corporate Code of Conduct (“CoC”), with supplier defined as deeper supply chain (Tier 1/2/3/etc).

3. Create, and implement, a Standard Operating Process (“SOP”) and an OSH implementation plan for deeper supply chain, even if such implementation in deeper supply chain is planned in phases, over a reasonable period. Include credible surprise audits, transparent and reliable reporting of accidents and near-misses, and accountability to auto-brands. Effective carrot and stick for good and bad behaviours. Make this a regular corporate board agenda item.

4. Report annually on SDG 8.8 (the only Sustainable Development Goal for worker-safety) in your Sustainability/Business Responsibility/Annual/etc Reports. This should include supply chain – aligned with India’s NGRBC (National Guidelines for Responsible Business Conduct, 2019).

5. Ask all Tier suppliers to take care of a few basics for workers, as also required under the OSH&WC Labour Code, to (a) Issue employment letters to all workers, (b) Conduct a medical health check for all workers above 40 years, (c) Pay twice the standard rate for overtime, and (d) register all eligible workers under ESIC, to ensure they get their and their families’ legal right for healthcare and compensation - pre and post any injuries. Shockingly, 65% of 2,700+ injured workers we have assisted in the past 4 years do not have their ESIC card until after the accident. And then they magically get them within a day or two. I think we call guess why that is!

B. Why do we recommend the above to the auto-sector brand-owners? Well, simply because it’s these brands who gain the most from these supply chains, have the most capital, power of suppliers and government policies and their implementation, and expertise to resolve this problem. It’s them who created these over decades and its them dear readers, you buy from and, may be, work with. In fact, 87% of 130+ of you said that in response to our Oct20 survey:

C. Is the auto-sector taking it seriously? What are they saying/doing? We hope so. Our discussions have been positive with SIAM, ACMA and six auto-sector brands. Maruti-Suzuki, also the market leader, has been most constructive and transparent about their action (and yes, there is the other extreme end :-). The Central and Haryana State governments, DG FASLI and ISF Gurgaon have started a few actions. This is a long journey, and we will not stop until we see tangible results. But we are encouraged by their responses, especially amidst Covid, and expect acceleration now: Mr Arun Maira, Former member of Planning Commission of India in SafetyNiti 2021 Foreword: “Indian auto-companies produce world class products and have made India proud…The companies may publicly espouse respect for human beings and their rights; the reality as the report reveals, is different. It reveals a disrespect for the lives of workers and the conditions in which they work. The OEMs are role Models. They must demand respect for human safety in all enterprises in their extensive supply chains”.

Mr Rajesh Menon, DG SIAM: “We would be very happy to partner with Safe In India Foundation…we (have now) started focussing more on the issue. We would continue to work with our member OEMs on sharing best practices…will include operational Safety and Health policies…how do we engage with all levels of the supply chain…issue of Supplier Code of Conduct…are two-three areas which we identified and will work very closely with our member OEMS… worker safety is good for business, good for productivity. ” Mr Vinnie Mehta, DG ACMA: “…Thank you for bringing it to the fore for the industry to take action. I genuinely believe that as the industry evolves, it needs to set right its index on health and safety. After the (SII’s) first event five years ago, we ran cluster programmes (in about 1200 companies) and we made it mandatory to have at least 10-15% of the education devoted to health and safety…We expect OEMs to do more… ”

Dr Elangavon, DG FASLI: “…it [safety] should be the initiative from the topmost authority in the organization…the person having the ultimate control over the factory”.

Mr AS Raju, Maruti Suzuki: “We have set up worker training centers at our tier 1 suppliers…(they) have a module of safety [including] accident simulation…programs go down the supply chain…equipment is audited…In the last three years about 15% of the suppliers have been phased out…we will support these guys and if they don't improve even after all these this kind of support then…this is where we have to take a call and say that it's not okay”.

Mr Viraf Mehta, Business & Human Rights Expert: “…these are human rights…with that statement comes the full bearing and the expectation of this international standard by the UN…the world is moving so rapidly towards mandatory Human Rights Due Diligence and what that means in the case of supply chain…a company should at least know what the extent of the human rights situation is and whether it's caused in its own captive supply chain entities…” Mr Sunil Arora, Chairman, Abilities Pistons: “ The owner’s mindset is really the main problem in the Indian context…business has been lost due to poor worker-safety…low cost automations (is) the way forward…Safety makes business sense. Period. If you're not good enough, you're not safe enough”.

Mr Rishi Sharma, Shriram Pistons and Rings: “We have integrated Health, Safety and Environment in our Vision and Mission statement…We do actually record the accidents or minor injuries of the visitors as well as contractors…We are extending our [HSE] expertise to our tier 2 and tier 3 suppliers through education… supporting them in ensuring the legal compliances…” The panel discussion, chaired by Mr PK Banerjee, ED, SIAM and including Dr Elangovan, DG FASLI; Mr AS Raju, Maruti-Suzuki; Mr Sunil Arora, Abilities Pistons; Mr Viraf Mehta, Business & Human Rights Expert and Ms Chitra Khanna, SII, explored the challenges business experience to improve worker safety, their attitude towards workers, the Human Rights framework for the issue and its solutions, in the video below:

Ms Chitra Khanna, Safe in India Foundation: “ILO in the recent technical meeting in February 2021 has identified auto-sector as one of the drivers to achieve the Sustainable Development Goals…(however), one indicator not finding place in the reporting is the Indicator 8.8... this particular indicator actually talks about protecting labour-rights and promoting safe and secure working environment for all workers…We would really like to see OSH in deeper supply chain as an agenda of OEM board meetings.”

Other media stories here.

D. What can you do (if you wish to)? A lot. As a start, you could discuss this issue with your friends and relatives in the auto-sector. We are often surprised that although this problem is generally known, the extent and gravity of the problem is not understood enough. You may want to share this blog with them.

And as always, we look forward to your support and suggestions. More than one crore people work in the auto-sector directly/indirectly - a sector which is also half of Indian manufacturing - and any improvement in it will not only help crores of people who depend on it but also improve India's labour productivity, currently 115th in the world! Stay Safe!

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