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Case Code: CLHR066
Case Length: 5 pages
Period: 2019-2020
Pub Date: 2020
Teaching Note: Available
Subject : Human Resources/ Organization Behavior
Organization :Honda Motorcycle and Scooter India
Industry :Automotive
Countries : India

Industrial Relations Issues at Honda Motorcycle and Scooter India



This case is about the labor unrest at Gurugram, India-based Honda Motorcycle and Scooter India (HMSI), a wholly owned subsidiary of Honda Motor Company, Limited, Japan. Trouble started after the management of HMSI asked 200 temporary workers to go on leave on November 5, 2019. The company claimed that the workers had been laid off due to a slowdown in the automobile sector due to sluggish growth in the Indian economy, which had led to reduced production. About 2000 contract workers went on a tool down strike, and were soon joined by permanent workers. The members of the HMSI union claimed that production was going on normally at the company’s other plants, and demanded compensation for the retrenched workers. The management of HMSI gave a call to the permanent workers to join duty by the end of November. While many employees rejoined after signing a good conduct agreement, union members claimed that without the contract workers it would not be possible to resume production. While the impasse continued, HMSI continued to produce vehicles at its other plants and the contract workers were left staring at an uncertain future.
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  • Examine the cause of labor unrest at HMSI.
  • Understand the stages of conflict development.
  • Understand how industrial disputes can be prevented.
  • Explore what HMSI management should do going forward.
It was November 5, 2019, and the day started out like any other day for the workers of Honda Motorcycle and Scooter India (HMSI) plant at Manesar in Gurugram district of the north Indian state of Haryana. But as the workers headed toward the plant to report for duty, some of them were stopped at the gates. The management prevented 200 contract workers from entering the plant, and asked them to go on leave for three months. The workers started protesting and, soon, others joined them. A total of 2,000 contract workers went on a tools-down strike.

The Indian automobile market had been facing tough times and both the car and two-wheeler markets had been adversely impacted by sluggish growth in the economy. The two-wheeler market had witnessed a decline for seven continuous months and, in the first nine months of 2019, it fell by 10 per cent. HMSI, the second largest player in the market, saw sales of its scooters fall by 21 per cent and that of motorcycles by 13 per cent. In October 2019, HMSI’s sales dropped to 517,808 units from 521,170 units in October 2018.


Industrial Relations; Labor Unrest; Labor relations; Labor-Management Dispute; Collective bargaining; Strike action; labor laws; Lockout; Worker participation; Indian Automobile Sector; Economic Slowdown; Conflict management; Progressive disciplinary action

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