Lockdown effect: Thousands of workers in Tamil Nadu's garment industry lose 3 weeks' wages despite government orders

In this hour of unprecedented crisis brought on by Covid-19 and the 21-day nationwide lockdown in India, the government and employers seem to forget that the most elemental human demand – of hunger – cannot wait. Sowmya Meenakshi ‘Two Sundays have gone by. Workers who get weekly payments have not got paid,’ says N Sekar, Banian Factories’ Labour Union AITUC General Secretary in Tirupur. He is referring to the approximately 200,000 migrant workers in the ready made garments manufacturing sector in Tirupur, who are stuck without work ever since the nationwide lockdown in India triggered by the novel coronavirus (Covid-19) pandemic was announced on 24 March. Migrants of ~17 states live in Tirupur. Most of them had their last working day on 21 March. Despite the Tamil Nadu government order which, among other things, mandates ‘all employers will make payments of wages/salaries to workers/employees including those working on contractual and outsourcing basis during this period,’ they have not been paid till date. ‘Usually, on-roll employees get paid monthly, while the large section of migrant workers are daily wage earners or are paid weekly. Those on the monthly system should get their March salary by 7 April. But those on the weekly/daily system have not been paid for two weeks now,’ says Sekar. In effect, many workers have not yet received salaries even for the days worked in March. ‘We have cleared all payments for days worked in March,’ counters Raja Shanmugham, President, Tirupur Exporters’ Association. ‘But how do you expect the industry, which is going through a Rs 8.5 billion strain due to stranded shipments and stalled production because of the worldwide Covid-19 crisis – to pay wages for no work done?’ he replies, when asked why the industry is flouting the government’s order.

Workers: Surviving the lockdown

While no one knows exactly, it is estimated that there are about 600,000 workers in the ready made garment industry in Tirupur. A majority of them are migrants – both intra and inter-state, with the latter rapidly on the rise over the last 5-10 years. Moreover, 70-75% of all workers in Tirupur are hired on ‘piece rate’, where no social security benefits such as provident fund, health insurance under Employees’ State Insurance (ESI) etc., are given. With no wages, no industry support, no rations (as they do not hold ration cards in their current residence) and no entitlement to any other relief (such as even a paltry sum of Rs 1,000 per ration card announced by the Chief Minister of Tamil Nadu), how are hundreds of thousands of migrants in the industry stuck thousands of miles away from their villages, expected to survive the lockdown? ‘We are getting desperate calls all day from workers asking for relief. Even last night, a Tamil migrant worker living in Kanakampalayam called saying his family had no rations or food to survive. The unions and NGOs are distributing food and other material. But there’s no way we can reach hundreds of thousands of workers in need. After many representations, the Collector has now ordered 10 kg of rice to be distributed for each migrant worker household,’ says Sekar. A Aloysius, Managing Director, Social Awareness and Voluntary Education, Tirupur, which has also been engaged in relief work, says, ‘On the ground, the situation is different. In many places, the village administrative officer, or VAO, is giving only 2kgs of rice and half a kg of dal (pulses) and oil. How long would that last a family of 4-5 or more?’ In Erode, another textile hub in the state, there are another 200,000 interstate migrant workers from Odisha, Bihar, Jharkhand and north-eastern states in a similar situation. R Karuppusamy, Director, Rights Education and Development Centre, an NGO in the area, has identified 1,320 migrants in eight settlements in a vulnerable condition and written to the Collector and Chief Minister for help. This is aside from distributing food supplies themselves.

The government response: A trickle that hasn’t reached

While the lockdown itself has been praised, the sudden manner in which it was brought upon has been received severe criticism. More than a week into the lockdown, it is also clear that the government has not given serious thought as to how it would impact the poor and marignalised communities already living on the brink of a ‘normal’ situation. The Finance Minister (FM) of the Government of India announced a Rs 1.7 trillion package for the poor on 26 March, which is grossly inadequate and ill-targeted. Some of the measures include, among others: Allowing employees to draw down 75% of their provident fund accrual or three months’ wages, whichever is lower, free cereals and gas cylinders, and a credit of Rs 500 per month for three months for female Jan Dhan account holders. But the FM’s package will not touch thousands of unorganised sector garment workers such as Deepak (name changed) from Assam, working in Erode as a contract labourer for the past 14 months. ‘I am living in a rented accommodation with my parents. I work in a garment unit, loading, unloading and helping operate the machine. I get paid Rs 500 per day for 12 hours. We would usually get paid around the 20^th of the month by the contractor for the previous month’s work. We have not received last month’s payment yet,’ says Deepak. He has worked 19 days in March, before the ‘janata curfew’ kicked in on 22 March, and then the 21 day lockdown was implemented. ‘We have been told we will not get paid for days not worked. After we protested, the contractor agreed to give Rs 100 per day as sustenance for these lockdown days. But we are still going to demand the full wage. We would have worked all these days, had the lockdown not been imposed,’ he says. Deepak does not have a bank account. He has not paid the monthly rent and can do so only on receiving his dues. Since he is not entitled to any rations, nor has he received any relief, he is buying food and provisions on credit from a nearby shop until he receives money from the contractor. Does the industry – which earns Rs 250 billion of revenue through the hard work of its workers – not have a moral obligation to support such workers left out of any safety net, in this hour of crisis?

The industry response: ‘We have no money to give away’

Raja Shanmugam says it takes more than one hand to clap. ‘We are working in a force majeure situation. Our shipments from mid-December to February have not been paid for, because of the clampdown across the European Union. Second, export garments are seasonal products and the season is changing. Brands are helpless in this situation, cancelling orders, offering massive discounts, etc. We have Rs 60 billion of pending payments from brands. Another Rs 25 billion of production in March is stranded (unable to ship). How much more strain can we bear?’ he asks. He suggests a distribution of responsibilities among stakeholders to help the workers and the industry. According to him, the industry has:

• Paid 100% of wages by 30 March, whatever work has been done up until 24 March 24
• Taken full care of workers in hostels by providing them food
• Asked companies to pay sustenance support of Rs 100 per day for those workers on the payrolls from Monday, 6 April onward

Additionally, he strongly suggests that:

• Brands must own responsibility of making payments on orders they have already committed to
• The government must pay all ESI cardholders through the ESI Fund (which is deducted from employees and employers’ contribution) for the days of lockdown. About Rs 100 million accumulates every month in the ESI Fund from Tirupur alone. This should cover on-roll employees.
• It must pay the non-ESI unorganised workforce through Jan Dhan accounts, whatever amount it decides
• It should also give the industry a one year moratorium on loans and the release of 25% additional working capital for survival in the coming months

The industry support of Rs 100 per day into the accounts of payroll employees again leaves out the poorest of workers, usually migrants. And how effective and practical are the other suggestions to take care of workers’ immediate hunger, anyway?

Wanted: A co-ordinated and effective response

Says Sekar, ‘There are about 200,000 ESI cardholders in the entire Tirupur district. This includes industries other than garments. Getting the amount through ESI is not easy. We have to go to the doctor, get certified as ill, and after a lengthy administrative process, the amount is credited, and we are entitled to only half the day’s salary. And where does that leave the remaining 400,000 workers?’ The suggestion that these workers be paid through Jan Dhan accounts is already a non-starter. Many of the migrant workers, like Deepak, do not have Jan Dhan accounts. The government’s support of Rs 500 per month for female Jan Dhan account holders for three months – even for those it reaches – will not hold out beyond three days. Clearly, much more is needed. But even if more measures are announced, with no proper records maintained by employers of migrant workers in the garment sector, timely delivery is a huge question. In other words, even in a situation of starvation forced upon them, workers are left hanging between the tightfisted government and an industry that doesn’t recognise its workers. It may take two hands to clap, but the industry seems to have forgotten that it takes only one to extend support to the most vulnerable of its workers in these exceptionally difficult times. This is no time for blame games. The immediate future of the export garments industry in Tamil Nadu that the nation takes pride in will depend on how, in the next few days, the stakeholders go beyond narrow interests, come together, and put forward their best foot to save workers and the industry from perishing. (This is Part 1 of a two-part series. The second part will examine the role of brands in ensuring the rights of workers in their supply chains during this crisis, as well as review of how any new government or industry announcements in the coming days is bound to impact or benefit workers.)

---

See Fair Wear’s full Covid-19 dossier, including guidance for brands and garment-producing countries, here.