The name "Special Economic Zones" or SEZ refers to a wide variety of zones,
including business zones, industrial parks, free ports, and export processing
zones. SEZ is a fully constructed infrastructure-integrated township. The SEZ
Act was passed by the government in 2005, and the SEZ Rules were released in
The government first launched the SEZ program in April 2000. The fabric of labor
relations as it currently exists is being altered by these zones, nevertheless.
Along with the significant investments being made in SEZs, instances of rights
violations and unplanned labor outbursts are becoming more prominent.
The zones' labor laws are becoming more flexible, but the effects on actual
labor have not been investigated. This article aims to highlight the current
position of trade unions in these SEZs, the issues faced by them and how they
work towards solving the issues faced by both, the workers as well as the
internal conflicts of the trade union itself.
What are Trade Unions?
Trade unions are social organizations that work in order to protect and
advance employees' economic and non-economic interests at work and in society at
large. They contend for the rights and entitlements of the workers while also
defending actual incomes through a range of tactics (industrial, legislative,
political, etc.). They have given workers "voice" in the workplace and in
society at large as well as established a variety of labor rights, such as
According to Section 2(h) of the Trade Unions Act, 1926:
Trade union means: "any combination, whether temporary or permanent, formed
primarily for the purpose of regulating the relations between workmen and
employers or between workmen and workmen, or between employers and employers, or
for imposing restrictive conditions on the conduct of any trade or business, and
includes any federation of two or more Trade Unions"
Position of Trade Unions in the Indian Scenario
Unions have made safeguarding the interests of the workforce a top priority in
India. Together with the unions, the government enacted labor laws. In India,
unions haven't often been created to increase output and effectiveness. They
were established, as in other countries, to eliminate labor exploitation and
demand greater wages. But in contrast to governments in other countries, neither
the Indian government�due to its socialistic leanings until 1991�nor the private
sector businesses�thought of them as a way to increase worker productivity.
As a result, unions grew into formidable forces that began to make their
presence felt, not by strengthening the economy, but by planning many national
and corporate strikes. Furthermore, the employer relishes disparaging unions,
opposing union formation, and taking a tough posture during collective
bargaining. As a result of the government's delay and management's unjust
practices, unions are upset. However, due to the lesser organizational
structure, management is effectively expressing itself alongside the
Trade Unions in Special Economic Zones
Economic reforms and the proliferation of Special Economic Zones are
expected to create job opportunities for millions. But, it is seldom clear what
kind of working conditions have emerged in these economic zones. The government
offers substantial tax advantages and financial incentives to encourage
industry, which may lead to the creation of jobs for millions of people both
directly and indirectly.
Literature on SEZs from all throughout the nation demonstrates a common pattern:
trade union activity is frequently outlawed and non-existent in economic zones.
Studies on SEZs in India have shown a trend where trade union participation is
severely restricted and almost non-existent.
Workers must put in long hours for no minimum pay to achieve tight criteria.
Employees are fired from their jobs without reason or pay, suffer from illnesses
connected to their jobs, and are not given maternity or paternity leave. Trade
union activity has frequently been restricted under SEZ restrictions, in
addition to enticements for potential investors such as reductions from import
duties on machinery and temporary tax exemptions.
The Trade Union Act has been amended, limiting the ability of unions to
establish them. Section 22 of the Act has been amended to allow up to 50% of a
union's officers to be hired by the sector they represent. Because of this
guideline, the national trade union leadership was able to establish unions in a
variety of industries throughout time.
In the case of SEZs, however, the states have contended that it is exempt from
Section 22 of the trade Union Act of 1926, which prevents or restricts outsiders
from holding office in trade unions. The formation of trade unions is forbidden,
and the New Delhi administration has exempted SEZs from most labor laws.
The Trade Union Act of 1926 and the Industrial Disputes Act of 1948 legalize
workers' freedom to organize unions and bargain collectively, despite
restrictions on certain jobs, particularly those in the government sector. In
practice, however, SEZs limit the right to organize.
Issues of the Trade Unions in the SEZs:
- Restrictions on entry in the SEZ premises:
The primary impediment to trade union activity is trade union officials'
admission to SEZ premises. According to trade union leaders, there have been
instances where management has asked trade unions to visit the industrial
facilities in the SEZ, then called the police and filed trespassing
accusations. Some of these occurrences have been reported in Chennai. This
restricted access is also utilized very effectively against employees in
order to terminate them.
Due to physical barriers, trade union access to workers was limited. In
order to create rapport, trade unions attempted to meet workers in places
other than their workplace. To further restrict worker contact with
outsiders, manufacturers provide workers with transportation in corporate
vehicles and drop them off at their work areas.
The plight of migrant workers is far worse. The firm offers lodging for
teenage migrant employees in several SEZs, who are strictly supervised even
during non-working hours. These personnel are from the state's outskirts.
The management takes advantage of their lack of familiarity with the
- Rivalry among Trade Unions:
On the ground, trade unions have rivalries because they are the workers'
wings of diverse political views and ideologies. There are certain
autonomous unions and unions that declare their independence from any
political philosophy or conviction. Political party rivalry has an impact on
labour unions in numerous fields, such as elections. Even on the job, trade
unions strive for workers' trust, which is ultimately assessed by the number
of enrolments and positions won in union elections. The challenge for trade
unions is to overcome their own outdated beliefs and rivalries with other
- Globalization Issues:
As a result of the globalised world and their internal operations, trade
unions face several obstacles today. The former has resulted in management's
substitution of labor for capital; changing forms of employment resources,
including the use of contract labor; management's hostile attitude and quest
for downsizing; strong opposition to union formation at the enterprise level
by management; and the government's indifferent attitude towards workers.
Overcoming the Issues faced by the Trade Unions in SEZs:
- Trade unions developed an area:
or region-based union strategy in SEZs
because admission of unions is forbidden and employees in contact with unions
face retaliation. These local or regional unions also promote communication
between employees from various units. Such engagement fosters solidarity in
times of need, and any unfair treatment of employees of one SEZ should ideally
be met with resistance by the workforce as a whole.
- A breach between the workers and the locals of a particular industrial
region or SEZ has occasionally been caused by management. Employers leveraged these
distinctions to their advantage in order to quell workers' protests. Trade
unions are therefore seeking to end this competition and foster peaceful ties.
- Increasing platforms of solidarity with societal forces that support
workers is vital, according to the trade unions. These networks of support
strengthen workers' confidence. Some labor leaders talked about building
comparable networks of solidarity with the aid of youngsters, students, and
other pro-worker organizations. Trade unions should harness the support of
international institutions and agencies to denounce unfair labor practices
at manufacturing plants.
In India, unions are still important now, just as they were in the early 20th
century. Varied challenges have varied shapes because of internal trade union
problems and governmental policies promoting globalization. Internally, unions
have been split along political lines and are not a unified force. Due to their
incapacity to defend workers' rights and lack of initiative in boosting the
economic performance of the companies, some employees and management do not
consider them as being useful.
Despite the severe suppression of the trade union movement, the trade unions
have developed certain techniques throughout time to unite dispersed workers. To
organize employees in production processes, whether they are in SEZs or not,
there is no one set formula or method, and trade union strategies have thus far
evolved in reaction to the particular circumstances they have come across while
working among the workers.
-  (Nov. 19, 2018), https://www.indiacode.nic.in/bitstream/123456789/13322/1/trade_unions_act_1926.pdf.
- Sodhi, J. S. (2013). Trade Unions in India: Changing Role & Perspective. Indian Journal of Industrial Relations, 49(2), 169�184. http://www.jstor.org/stable/24546947
- Parwez, S. (2015). Modified Labor Welfare Measures for Special Economic Zone & Implications. Indian Journal of Industrial Relations, 50(3), 386�396. http://www.jstor.org/stable/24549102
- Montesano, EPZ_India.vp, (Sept. 27, 2012), http://ilo.org/wcmsp5/groups/public/@ed_dialogue/@actrav/documents/publication/wcms_221002.pdf.
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