Indian court orders 30 percent pay hike for garment workers

by Anuradha Nagaraj | @anuranagaraj | Thomson Reuters Foundation
Tuesday, 19 July 2016 15:53 GMT

Employees work inside a garment factory in Mumbai, India, June 1, 2016. REUTERS/Danish Siddiqui

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India is one of the world's largest textile and garment manufacturers

By Anuradha Nagaraj

CHENNAI, India, July 19 (Thomson Reuters Foundation) - An Indian court has ordered a pay rise of up to 30 percent for hundreds of thousands of garment workers in the southern state of Tamil Nadu, the first minimum wage hike in more than 12 years.

But lawyers for 500 clothing manufacturers and exporters, who supply many international brands, said the new wages would be "practically impossible" to introduce given the tough global market conditions.

Under the ruling, workers would see their pay rise from a monthly average of 4500 rupees to 6500 rupees ($67 to $97) - which campaigners say is comparable to wages for textile jobs in most other states.

"It is a huge victory in a long drawn (out) battle to get workers their due," said Sujata Mody of Penn Thozhilalargal Sangam, a women's workers' union.

"Workers have been living in impoverished conditions with inflation and prices on the up."

Campaigners demanded the state government ensure immediate compliance with the court ruling by textile firms.

India is one of the world's largest textile and garment manufacturers. The $40-billion-a-year industry employs around 45 million workers.

Under the Minimum Wages Act, introduced in 1948, state governments are required to increase the basic minimum wage every five years, but textile manufacturers have repeatedly challenged these pay rises in Tamil Nadu.

The last time the state government revised pay was in 2004. But the matter went to court immediately and the increase was not implemented.

Employees work inside a garment factory of Orient Craft Ltd in Gurgaon on the outskirts of New Delhi, India, in this July 3, 2015 file photo. REUTERS/Anindito Mukherjee

During a lengthy legal battle judges at the Madras High Court dismissed over 500 petitions filed by manufacturers and exporters opposing a subsequent 2014 government order to increase wages.

In its July 13 ruling, the court asked manufacturers to immediately pay the revised wage as well as arrears backdated to December 2014.

The workers - including cloth cutters, tailors and button makers - will also get an additional inflation-linked allowance.

Shirt seamstress A. Dhanalakshmi welcomed the ruling, saying she struggled to get by on the 6,000 rupees she earns each month, working an average 45-hour week at an export firm near Chennai.

"My workload increases but the salary barely does," she told the Thomson Reuters Foundation. "The court verdict has given me hope."

Lawyers for the government accused the manufacturers of having "unclean hands" and told the court that many had never paid their employees the minimum wage.

But the manufacturers and exporters, who are considering an appeal against the ruling, argued in court that the wage rise was unrealistic given the stiff competition they faced from neighbouring countries like Bangladesh and China.

"Many Indians have set up factories in Bangladesh rather than here because it is cheaper there," said lawyer Vijay Narayan. "It is very competitive and that is a reality."

($1 = 67.1890 Indian rupees)

(Reporting by Anuradha Nagaraj, editing by Emma Batha. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking and climate change. Visit www.trust.org)