Experimenting with a new category of temporary workers, Maruti has decided to do away with hiring through labour contractors under the Contract Labour Act. The old system, it has come to realise the hard way, was an unreliable and unjust way of hiring and retaining workers. "A contract worker cannot possibly have any commitment," explains RC Bhargava, chairman of MSIL. "He doesn't see a future for himself in the company. Instead of motivation and accountability, we have suspicion and witch-hunting. It impacts capacity utilisation and performance adversely." MSIL's new system basically draws on provisions for temporary workers in the Industrial Disputes Act (IDA) and builds on it through layers of its own innovations. Earlier, large sections of workers were on the rolls of contractors and salaries were routed through them. Unscrupulous contractors made all sorts of deductions.

Read the Economic Times news report here.