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PREFACE:

The human resource of an organization constitutes its entire workforce. Human resource

management(HRM) is responsible for selecting and inducting competent people, training them,

facilitating and motivating them to perform at high levels of efficiency, and providing

mechanisms to ensure that they maintain their affiliation with the organization.

Earlier the human resource was not considerd as such an important part of any organization

however today human resource is referred to as human capital by a number of organizations.

In 1997 Infosys was the first Indian organization to actually declare the value of its human

assets.The human resource department of any organization is responsible for ensuring the

satisfaction of its employees.It must be noted that a happy and satisfied employee is a productive

employee.Today almost all organizations try various ways and means to keep their employees

happy,however every organization on will conduct any such activity in keeping with its

organization culture and mission and vision of the organization.

In this small treatise I shall try to profile TATA MOTORS in terms of its mission,vision,culture

and steps it has taken to ensure employee satisfaction.


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INTRODUCTION:

Established under the parent company, Tata Group, in 1945, Tata Motors Limited has become

Indias largest automobile company. It was the first Indian automobile company to list on the

New York Stock Exchange. Tata Motors began manufacturing commercial vehicles in 1954 with

a 15-year collaboration agreement with Daimler Benz of Germany. This partnership has led Tata

Motors to not only become Indias largest automobile company but also Indias largest

commercial vehicle manufacturer; the worlds top five manufactures of medium and heavy

trucks and the worlds second largest medium and heavy bus manufacturer. Having just entered

the passenger vehicles market segment in 1991, Tata Motors now ranks second in Indias

passenger vehicle market. Tata has enjoyed the prestige of having developed Tata Ace, Indias

first indigenous light commercial vehicle; Tata Safari, Indias first sports utility vehicle; Tata

Indica, Indias first indigenously manufactured passenger car; and the Nano, the worlds leastexpensive car.

CURRENT SITUATION:

The Tata Motors group is a passenger and commercial vehicle manufacturer based in India. The

motor group was established in 1945 as part of the larger Tata Group. They have long been

known for their commercial vehicles and in the past ten years entered into the passenger car

market. Currently, Tata Motors has a line of five passenger vehicles and a large line of

commercial vehicles producing pickups, trucks, tractor trailers, tippers, and buses. Both product

lines of the Tata Motors group have seen success, but much of this has been built upon the more

deeply established commercial vehicle product line.

Tata Motors commercial line has been established for several years in many market segments

such as Europe, Africa, The Middle East, Australia, Southeast Asia, and South Asia. Tata

Motors has expanded their business and market share around the world through a series of

acquisitions. In 2004, they acquired Daewoo commercial vehicle Company in South Korea

which was South Koreas second largest truck manufacturer. This acquisition gave Tata Motors a

significant presence in the Korean market. They have also entered into joint ventures with

companies such as Thonburi Automotive in 2006, which allowed them to manufacture and

market pickup trucks in Thailand.


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Tata Motors have been making global headlines in the auto industry lately; the largest news

being their acquisition of Jaguar and Land Rover from Ford. Tata paid 2.3 billion dollars to

Ford for the two brands that cost Ford 5.3 billion (Carty, USA Today). This is a major step for

the company because it catapults them into the luxury car business.

The vision, mission and core values for the two business units of Tata Motors, Passenger Car andCommercial Vehicle are

(Source:Tata Motors Annual Report 2009)


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(Source:Tata Motors Annual Report 2009)


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The vision of both the units of Tata Motors clearly states their desire to be world class units in

their own area of expertise.If we look at the mission statement we clearly see a statement saying

create an organization people enjoy working for,this single line is enough to reinforce the fact

that Tata Motors considers its employees of supreme value and follows a culture that is very

much employee oriented as in it always is ready to look into the needs of its employees and do

its best for them.No doubt then that today it is one of the most admired organizations and

employees are proud to be associated with Tata Motors.

What then are the various measures that Tata Motors takes to ensure its employees are

satisfied,what facilities does it provide to them to keep them motivated.

Which departments play a key role in formulating these policies and executing them,and the

corporate governance policy are discussed in the next part.

DeployIdentify, Trai

n /Develop, Grow, RotateS Y S T E M S SY S T EY S T E M S


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Labour issues are managed by Employee relations department at each manufacturing location,

which forms a part of the human Resources Department. Within a manufacturing unit, there are

multiple factories and in each factory there is an officer in charge of safety. These officers in turn

identify and train Safety Stewards from amongst the workers. The structure enables the effective

implementation of Poka-Yoke (mistake proofing).

Manpower planning department looks after recruitment, training and performance management

at all levels. Training division at every location is in charge of identifying skill gaps and

designing and organising training programmes for both the blue-collared and the white-collared

workers.The said structure is at every manufacturing location and the Plant Head is in charge for

the unit.Functional Heads function at the corporate level as well and report to the Managing

Director or to the Executive Director.

A. LABOUR PRACTICES AND DECENT WORK

LA 1: Total Workforce by region

The Management team comprises of Executive Grade which represents the senior leadership, the

TM grade which represents Middle Management as well as the various entry points based on

different level of education like graduation, post graduation etc. Operatives refer to workmen

who have requisite technical qualification employed for direct production activities.


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LA 2: Total rate of employee turnover

Tata Motors Annual Attrition Percentage for various grades is as follows:

LA 3: Benefits provided to full-time employees that are not provided to temporary or

part-time employees

Employee Benefits

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering

eligible employees. The plan provides for a lump sum payment to vested employees at

retirement, death while in employment or on termination of employment of an amount equivalent

to 15 to 30 days salary payable for each completed year of service. Vesting occurs upon

completion of five years of service.The Company makes annual contributions to gratuity fund

established as trust. The Company accounts for the liability for gratuity benefits payable in future

based on an independent actuarial valuation.

(ii) Superannuation

The Company has two superannuation plans, a defined benefit plan and a defined contribution

plan.An eligible employee on April 1, 1996 could elect to be a member of either plan.

Employees who are members of the defined benefit superannuation plan are entitled to benefits

depending on the years of service and salary drawn. The monthly pension benefits after

retirement range from 0.75% to 2% of the annual basic salary for each year of service. The

Company accounts for the liability for superannuation benefits payable in future under the plan

based on an independent actuarial valuation. With effect from April 1, 2003, this plan was

amended and benefits earned by covered employees have been protected as at March 31, 2003.

Employees covered by this plan are prospectively entitled to benefits computed on a basis that

ensures that the annual cost of providing the pension benefits would not exceed 15% of salary.

The Company maintains a separate irrevocable trust for employees covered and entitled to


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benefits. The Company contributes up to 15% of the eligible employees salary to the trust every

year. The Company recognizes such contributions as an expense when incurred. The Company

has no further obligation beyond this contribution.

(iii) Bhavishya Kalyan Yojana (BKY):

BKY is an unfunded defined benefit plan. The benefits of the plan accrue to an eligible employee

at the time of death or permanent disablement, while in service,either as a result of an injury or

as certified by the Companys Medical Board. The monthly payment to dependents of the

deceased / disabled employee under the plan equals 50% of the salary drawn at the time of death

or accident or a specified amount, whichever is higher. The Company accounts for the liability

for BKY benefits payable in future based on an independent actuarial valuation.

(iv) Post-retirement Medicare Scheme:

Under this scheme, employees get medical benefits subject to certain limits of amount, periods

after retirement and types of benefits, depending on their grade and location at the time of

retirement.Employees separated from the Company as part of Early Separation Scheme, on

medical grounds or due to permanent disablement are also covered under the scheme. The

liability for post-retirement medical scheme is based on an independent actuarial valuation.

(v) Provident Fund:

The eligible employees of the Company are entitled to receive benefits under the provident fund,

a defined contribution plan, in which both employees and the Company make monthly

contributions at a specified percentage of the covered employees salary (currently 12% of

employees salary). The contributions as specified under the law are paid to the provident fund

and pension fund set up as irrevocable trust by the Company or to respective Regional Provident

Fund Commissioner and the Central Provident Fund under the State Pension scheme. The

Company is generally liable for annual contributions and any shortfall in the fund assets based

on the government specified minimum rates of return or pension and recognises such

contributions and shortfall, if any, as an expense in the year incurred.

(vi) Compensated absences:


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The Company provides for the encashment of leave or leave with pay subject to certain rules.

The employees are entitled to accumulate leave subject to certain limits, for future encashment.

The liability is provided based on the number of days of unutilised leave at each balance sheet

date on the basis of an independent actuarial valuation.Some other benefits advanced to the

permanent employees are:

Allowances like Transport allowance, Education allowance, Sanitation allowance, Leave

travel allowance etc

Annual Performance linked Payment

Free Medical facility for family

Company loans & advances

LA 4: Percentage of employees covered by collective bargaining agreement

Tata Motors has internal unions at its manufacturing units at Pune, Jamshedpur and Lucknow,

which enjoy majority with upto 98%-99% membership. These unions form representative bodies

of the workmen and negotiate with the management and settlements signed with these unions

respectively cover all permanent workmen present. At Uttarakhand, which is our new

manufacturing unit location,compensation of the operatives is decided on the basis of industry

and region parity and in consultation with Works Committee formed from time to time.

LA 5: Minimum notice period(s) regarding operational changes, including whether it

is specified in collective agreements

For Notice period regarding operational we follow the procedures mentioned in the Industrial

Disputes

Act (21 days). This Act was passed by the Central Government of India to make provisions for

investigation and settlement of industrial disputes and came into existence in April 1947.

LA 6: Formal Joint Management-Worker Health and Safety Committees

Tata Motors has a Safety Health and Environment (SHE) policy, which encompasses all

regulatory norms along with International Labour Organisation recommendations. Tata Motors

has a process for reporting, recording, analysis and action on accidents and unsafe conditions.

The safety issues are addressed through a bipartite (management and union) arrangement as

depicted in the table here below.


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Table 1: Various Health and Safety committees at plant location

These committees thus cover 100% of the workforce.

LA 7: Injury, accidents, work-related fatalities:

The practices are in line with the International Labour Organisation (ILO) Model code of Safety

Regulations for Industrial establishment for the guidance of Government and Industry. The

decision taken by the Governing body of the ILO conference held in 1948, the model code is not

an instrument involving any binding obligations, and Government and industries are free to make

such use of it as they see fit in framing or in reviewing their own safety regulations. The above

guidelines are,however, incorporated in the Factories Act 1948 and the Company strictly follows

the rules and accordingly the accident reporting or notice of accident or dangerous occurrence is

recorded and communicated to the concerned authorities (CIF) in FORM No. 17A.

LA 8: Risk-control programmes in place to assist w orkforce members, their families

or community members regarding serious diseases:

Tata Motors provides curative and preventive health services to the employees, their families as

well as the community at large. It views its initiatives as a part of its social responsibility and as

an investment in improving social capital. Of these initiatives, some have been highlighted in the

following paragraphs. The Company has a robust Medical Scheme which covers complete health

care of employees and their dependent family members.

Tata Motors is committed to take initiatives to combat the spread of HIV/AIDS. Tata Motors is

aware of the social stigma that accompanies the contraction of HIV / AIDS and thus as a

conscious decision,the Company does not make any discrimination, right from employment to

retirement of employees.

During pre-employment medical check-up, no HIV testing is done


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Employees having HIV /AIDS are allowed to work in the Factory until they are able to

continue normal duty.

Companys Medical Benefit Scheme extends its benefits (reimbursement of medical

expenses) to employees who are suffering from HIV / AIDS. These benefits are at par

with any other medical benefits (It is not under exclusion as most of Insurance

Companies are having)

Total confidentiality is maintained about HIV +ve status of any employee

Tata Motors sta rted its AIDS awareness programme with the primary aim to cover all

employees and to make them aware about the causes, symptoms, myths and

prevention of HIV/AIDS. Company doctors designed a 30 minutes lecture module and

delive red it to all employees on the shop floor, followed by distribution of informative

bookl e t o n A IDS. A l l e xpenses for the d e si gn i n g an d implementation of the programme

were b o rne b y the Company.

In addition, Tata Motors supports a hospital in Jharkhand state and also runs Mobile Health

Clinics in various villages adopted by the Company in Jamshedpur, Lucknow and Pune.

Awareness programmes are extensively organised on various health issues for the community

members. The curative and preventive health services were provided to over 92390 non-

employee patients in 2007-2008.

Photo: Jamshedpur Hospital

Tata Motor s has also treated 8,000 leprosy patients in last two decades through the Nav Jagrat

Manav Samaj (NJMS) in Jamshedpur, Jhar khand. The ser vices extended have contributed

towards the reduction of leprosy prevalence rate in Jamshedpur down from 22/1000 to 2.2/1000.


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Photo: Mr . Jowahar Ram Paswan, a beneficiary of the NJMS programme and now a full-time

volunteer with NJMS, with a patient at the ashram

Rehabilitation work for leprosy-affected people is carried out by the Nav Jagrat Manav Samaj in

Jamshedpur. 8 ashrams situated around the city of Jamshedpur, which are self-settled colonies of

people affected by leprosy, are supported with medical and institutional help for making their

lives comfortable and humane. More than 400 children of cured leprosy patients have been

helped into the formal stream of education. Also promoted are savings in banks by these people

and adoption of small business/vocations like rearing of livestock, poultry, cycle-rickshaw, cart

and even growing vegetables and selling them. A temporary hospitalization facility with 28 beds

is available for the treatment of seriously afflicted patients of leprosy. A 30-bedded Old Age

Home run by NJMS caters to the old and destitute.

LA 9: Health and Safety topics covered

Safety has been a concern for Tata Motors and the Company is taking steps to reduce the injuries

and accidents. All Tata Motors manufacturing units, including the new manufacturing unit at


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Uttarakhand are certified under Occupational Health and Safety Standards 18801 (OHSAS

18001,2007 version). OHSAS 18001 is an Occupation Health and Safety Assessment Series forhealth and safety management systems. It is intended to help an organization to control

occupational health and safety risks. It was developed by the Government of India in response to

widespread demand for a recognized standard against which to be certified and assessed.

In addition, Tata Motors manufacturing unit at Pune has been certified Social Accountability

8000 compliant. Clause No. 3 of the SA 8000 pertains to occupational health and safety. A Zero

Accident Plan was launched in 2007-08, wherein area ownership was developed by teams

comprising of management and supervisory grade workers called Bay Owners. The Bay Owners

met twice a week and conducted cross audits and organised awareness building programmes.

LA 10: Employees receiving regular performance and career development reviews

All employees are evaluated based on performance and merit. The Company has customized the

PMS for the requirements of different categories of employees-managerial, supervisors and

bargainable employees. In the PMS system, Individual performance plans are cascaded from the

Balance Score Card down to the smallest work unit, bringing business and customer focus to all

levels and teams. Monthly and mid-course half yearly reviews are held to ensure resources;

targets and training are in alignment with business needs. Employees have an opportunity to

develop their own view of their performance and discuss it with their supervisor. Formal

evaluation ratings are assigned at the end of the year. PMS instills a high performance culture in

the organisation.Competencies of successful executives are used as input to project the Pen

portrait of the ideal incumbent. To track the state of readiness and migration paths, the

succession planning process includes colour coding for potential successors. This helps in

arriving at the best fit.The process is reviewed periodically for status of successors and for

process improvements. In case a successor is not identified from the Department and Talent

Pool, an internal advertisement is released. If the position cannot be filled internally, a suitable

candidate is selected through External Advertisement.All employees have the opportunity to

advance their careers. The Company administers career progression through the PMS system formanagerial employees. All employees have the opportunity of moving to higher levels. This is

based on their personal preparation and desire to move, windows of opportunity and a fair

selection process.

B. HUMAN RIGHTS


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The Ethics team at Tata Motors is in charge of the human rights aspects in the Company. The

structure of the Ethics Department is given below.

HR 1: Human Rights Screening for Suppliers and Contractors

Tata Motors Limited has Supplier and Dealer assessment process to take care of issues related to

social aspects before inducting them in organisation. All legal and regulatory requirements need

to be fulfilled before final selection into the Tata Motors fold. The company periodically audits

the job contractors for adherence to labour laws and other statutory requirement like minimum

wages, PF,payment of gratuity etc. thereby ensuring prevention of violation of Human rights and

employment malpractices.

HR 3: Employee training on Policy and Procedures concerning Human Rights

Tata Motors adheres to the Tata Code of Conduct in its business. Tata Code of Conduct has

covered all the Human Rights principles proclaimed in Universal Declaration of Human Rights.

However, to strengthen and support internationally proclaimed Human Rights within the

business of the Company,it was decided to design exclusive policies on various aspects of

Human Rights.The Policy on Human Rights is as under:

Tata Motors believes in and respects Human Rights as enunciated by the International Labour

Organisation.

Tata Motors is committed to protect the Human Rights of its employees while dealing with them

in all the activities falling under the relationship of Employer and Employee.Decision to seek

employment rests with the individual only, and it is completely voluntary. Tata Motors does not

and will not allow or encourage Compulsory or Forced Labour in any of its processes and

practices.Tata Motors respects the right of its eligible employees to organise for the purpose of

Collective Bargaining as well as their right to support or oppose the labour union recognised by

Tata Motors.Tata Motors respects the definition of Child Labour as mentioned in the guidelines

of International Labour Organisation. Tata Motors will not engage any person under the age of

18 years (legal age of employment) for any operations or services (as presented in law) unless it

is part of government approved job training or apprenticeship programme.Tata Motors honours

the right of its employees to choose and decide the extent of their involvement in Political

Activities in their Personal Time.Tata Motors expects its Channel Partners and Contractors to

adhere to business principles consistent with its own. Each new joinee receives a copy of the

TCoC. Furthermore, Excerpts from the Code is prominently displayed at all locations and

employees are well aware of its components and adhere to it in letter as well as in spirit.


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All these clearly show that Tata Motors treats its employees with great importance and ensures

that they do not face any hindrances at work or otherwise.The various social initiatives taken up

by Tata Motors reveals that human resource is of utmost importance to them.It is obvious that an

organization which follows do many good labour practices enjoys the confidence of its

employees.The culture at Tata Motors is at par with any organisation under the Tata group.

Since Tata Motors is a part of a large conglomerate company it needs to have a strong corporate

governance to ensure that its employees act ethically and the business continues to run smoothly

especially during the ever changing and dynamic global economy. Tata Groups corporate

governance is founded upon a rich legacy of fair, ethical, and transparent governance practices

(tatacarsworldwide.com). One of the more important parts of this is the transparency of the

company people have a right to know what the company is doing not only to ensure ethical

practices, but for the insurance of their many shareholders whom have a right to know the inner

workings of the company.

Tata has created some models for employees to guide themselves through everyday business

practices to ensure that the corporate governance is continuously being upheld. The Tata

business excellence model is upheld by Tata quality management services. Quality management

is an in-house group dedicated to helping the various Tata companies achieve their business

objectives through specific processes. The two main processes that the quality management

services employees focus on are business excellence and business ethics. These two objectives

have helped build Tata into the strong, dynamic company it is today. These models are

entrenched in the companys ethnical standards and Tata feels strongly about enforcing both

throughout the company. Tata quality management services plays the role of supporter and

facilitator in the journey that Tata enterprises undertake to reach the peaks of business eminence

while, at the same time, adhering to the highest ethical standards (Tata.com).

According to the Tata lexicon, good governance has to stretch way beyond staying on the right

side of the law and it has to come from faith rather than force. Yes, we have a code of

conduct, but ethical behaviour cannot be enforced by diktats and through written documents,

says Kishore Chaukar, GCC member and chairman of Tata Industries. You have the Bible, the

Bhagwad Gita, the Koran; they all tell you how to behave. Doesnt help. The Indian Penal Code

is clear about what constitutes criminal behaviour, but that hasnt stopped the rapes and the

murders, the felonies and the burglaries.An implicit sense of ethical business conduct has been


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the cornerstone of the Tata way of corporate governance. Rules and regulations certainly have a

place in this scheme, but they supplement rather than supplant the traditional values on which the

group has been shaped. Good governance has taken root in and spread to all branches of the Tata

Group. Theres nothing amorphous about that.

To sum up Tata Motors is one of the most ethical and employee oriented organizations today.It is

an organization which prides itself in its employees.The employees on the other hand are also

very proud and possessive about Tata Motors.

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