Q1.CASE STUDY 3: Andhra Pradesh State Road Transport Corporation (APSRTC)

Andhra Pradesh State Road Transport Corporation (APSRTC), an autonomous body providing public transport services in the state of Andhra Pradesh, was established in the early nineteenth century as a part of the erstwhile United Railways and Road Transport Corporation. The company was started by the then Nizam of Hyderabad, with a fleet of around 10 buses in the twin cities of Hyderabad and Secunderabad. In the early 1950s, after independence and the formation of the State of Andhra Pradesh, an independent road transport organization (APSRTC) was set up. The Corporation is now one of the largest road transport undertakings in the country with a fleet of over 20,000 buses and an Employee strength of more than one and half lakhs. The organization has two major Trade Unions, namely Employees Union (EU) and Bharatiya Mazdoor Sangh (BMS). The Corporation has a record of peaceful industrial relations and the elections to the Trade Unions lead to one of them coming to power on an alternate basis. Liberalization and privatization meant that private road transporters were allowed to operate, leading to severe competition. The Organization, which has a record of Employee welfare, has to compete with the private players, who do not adhere to statutory obligations. Further, the Organization also suffers on account of certain welfare policy measures, which have been announced by the State Government, such as concessional and free bus passes to a certain segment of citizens. In addition, it has to pay Motor Vehicle Tax to the State Government at a high rate, leading to severe losses. Further, there have also been rumours that the Corporation would soon be privatized on account of the accumulated losses. The Trade Unions felt it was their responsibility to safeguard the existence of the Corporation. For this purpose, they placed the following demands before the Management as well as the State Government:

Waive of the Motor Vehicle Tax.

Provide budgetary support from the State Government to offset the losses on account of concessions being announced by the State Government.

Stop privatization/outsourcing of private buses, improve maintenance operations, and purchase more buses.

Reduce the administrative staff and streamline the purchase procedures.

Based on these demands, the Trade Unions had prolonged discussions with the Management. However, the Management could not respond to the major demands and referred the matter to the State Government. The State Government, on account of the severe financial crunch, refused to accept the major demands of the Trade Unions, following which the Trade Unions went on a strike for 20 days. This led to further severe losses to the Corporation and the Government encouraged the private players to run additional services in order to weaken the position of the Trade Unions. Further, the State Government also persuaded one of the Trade Unions to withdraw from the strike, which led to the partial restoration of bus services. The Employees of the other Trade Union put pressure on the Trade Union leaders to stop the strike. The other Trade Union leaders had negotiations with the State Government and agreed to stop the strike on the following conditions:

The Management should not initiate any disciplinary action against the employees.

Participation in the strike should not be a ground for disqualification from the timely release of increments.

The State Government would consider the waiver of the Motor Vehicle Tax and also provide partial budgetary support to the Corporation.

QUESTIONS

(i)Critically analyse the above case study.

(ii)Do you think that the Trade Unions were right in going on strike?

(iii) What could have been a better strategy adopted by the Trade Union to protect the interest of the corporation?

(iv) Do you think the Management had any role in preventing industrial unrest?