Burn-out in the Global Call Centre
Friends of the call centre worker’s inquiry collective, Kolinko, update their work a decade and a global crisis later, from massive outsourcing to India to digital ‘on-shoring’ in the West
Call centres were the archetype of a workplace for the capitalist cycle between the early 1990s and late 2000s. Located in the dominant sectors of the cycle in the global north, e.g. banking, insurance and personal services, they were able to absorb and combine both surplus capital (which had escaped shrinking profit margins in industry); and surplus labour (in the form of the unemployed graduate and dismissed industrial workers). Call centres became de facto outsourced university departments where students were forced to work off their student debt and get used to their future perspective as precarious wage dependants. The call centres’ external appearance bore little resemblance to the factories of the past: instead their culture of ‘work-time/leisure-time’ balance was supposed to turn the collective experience of work into a question of individual life-management. They formed part of the general propaganda proclaiming the ‘end of the working class’, which has prevailed since the 1980s – while at the same time concentrating and ‘proletarianising’ large sections of previously ‘white collar’ workers under one roof and subjecting them to a Taylorised ‘factory mode’ of production. Instead of individualising neoliberal subjects, call centres simply extended the industrial system into the office world and collectivised a section of the working class, such as bank clerks or administrators, who previously saw themselves as ‘educated employees’. As a labour intensive and mobile industry, call centres quickly combined labour in different parts of the globe.
Call centres were as much the embodiment of the hailed ‘post-industrial’ boom of capitalism as they were subject to its ephemeral nature. In 2001, the bursting of the ‘New Economy’ bubble sent shockwaves through the sector and swept call centre jobs towards the lower wage regions of the globe. With the financial crisis in 2008, ‘offshored’ call centres in the English-speaking global south were shaken as geographical shifts and technological restructuring took place. Since then the ‘wage competition’ between call centres in impoverished and deprived regions in the crisis-ridden global north (rustbelts) and in the small pockets of development in India, the Philippines or South Africa has intensified.
Image: IBM, Sapient and Amazon offices in Gurgaon India
During the late 1990s call centre jobs were been relocated from France to the French speaking ex-colonies such as Morocco and Tunisia. But they absorbed only a fraction of the unemployed local youth – the generation that led the social explosions of 2011. For us the question remains whether call centres, as part of the global industrial structure, can become the ‘telegraph stations’ of this emerging global strike movement.1 This question will not be answered through distant research but through active participation in workers’ struggles.
At first, call centres in India were criticised only for being part of a ‘cultural degradation’ and ‘westernisation’. Soon enough the focus turned to the actual working conditions and the fact that call centre jobs become less attractive once they are no longer seen as a temporary stopgap between graduation and future career but as a lifetime wage prison.
The Big Shift
After the ‘New Economy’ slump of the early 2000s, the international relocation of call centre jobs accelerated. State media, politicians and national trade unions presented this as ‘job losses’. Before looking at the actual geographical shifts within the sector, we would first like to question this nationalist-protectionist position. Call centres themselves are in many ways both the result and causally ‘accelerators’ of ‘job losses’. From the 1980s onwards, General Motors earned more money by selling credit schemes than by manufacturing cars. The company downsized factories. Thousands of industrial jobs were wiped out, while a smaller number of jobs were created in the more profitable banking sector where call centres were situated. Call centres themselves reduced the numbers of workers employed in offices and bank branches by introducing ‘labour saving’ work processes and technology, which transformed formerly skilled white collar work into Taylorised jobs.
Within the ‘national framework’ call centres were placed in regions of ‘underdevelopment’, such as old industrial or mining areas with high unemployment. This is the general process of capitalist expansion – none of those ‘saviours of labour’, from protectionist politicians to trade unions, criticised this general process, they only started to cry once ‘jobs went abroad’. Here we also see one of the main shortcomings of the ‘anti-globalisation’ movement; this global ‘movement’ never questioned the protectionist ideology of the labour movement or social democracy and certainly never developed a new ‘proletarian internationalism’.
The following summary of a Los Angeles Times article from 2004 illustrates the problems of re-location at the time:
Clintwood, Va. – This remote Appalachian town doesn't get many visitors, but every day it sends thousands of travellers on their way. If you buy an airline ticket off the Travelocity website and need to call with a change or a question, the phone rings here. [...] The Travelocity call centre brought 250 jobs to a community wounded by the decline of coal mining, its mainstay for a century. It plugged the town's 1,500 residents into the global high-tech economy, offering the prospect of a secure future. That illusion crumbled last month when Travelocity fired Clintwood, saying it would close the call centre by year-end and move all the jobs to India. [...] The call centre clerks in Clintwood start at $8 an hour. In India, their replacements will earn less than a quarter of that. [...]. More than a quarter of the 2.25 million call-centre jobs in the U.S. are expected to go offshore.2
It took the garment textile industry about a century to move from the UK to the US to Asia. With the development of microelectronics and a more integrated world market, the call centre industry went global within a couple of years. The following clippings from early summer 2005 convey the atmosphere at the time.
Datamonitor predicts that more firms are set to follow the likes of British Airways, Citibank, General Electric and HSBC, all of which have spun off a part or all of their operations to India.3
350 call centre jobs to go at British Gas: workers in Oldham have been told that 350 of them will lose their jobs because a new £430 million computer system can do their work better. The company is considering transferring any remaining clerical work that cannot be done by the computer to workers in India.4
IBM shifts jobs from USA to India: even as it proceeds with layoffs of up to 13,000 workers in Europe and the United States, IBM plans to increase its payroll in India this year by more than 14,000 workers, according to an internal company document.5
NAB shifts call center jobs: NAB outlined the plans to axe 4,200 jobs from its Australian and UK operations as it revealed its half-year financial results. At the same time Lloyds TSB announced it intended to have 2,500 staff in India by the end of this year.6
Call centre operator Sykes Enterprises shrank its U.S. operations and last year added close to 10,000 call centre workstations in Costa Rica and the Philippines.7
As in the garment sector, capital compared global absolute wage levels for a global product like ‘back office calls’ and was drawn towards the lower wage regions. ‘Per agent cost in USA is approximately $40,000 while in India it is only $5,000.’8 ‘Average call centre salaries in the UK are about £12,500 ($22,000) a year, compared with £1,200 ($2,100) in India.’9 In the case of the call centre sector, capital does not even have to take into account the transportation costs for the finished commodity. With call centres, the precondition for global relocations is the stable supply of English-speaking workers able to use computers and to adjust to the alienation of market research standards and customer services. In addition, a certain infrastructure both for the operation (office space, communication networks etc.) and for the workforce (accommodation, attractive surrounding) is necessary. In the case of India we can say that in the process of relocation more jobs were actually created, given that you find a much higher share of auxiliary workers in Indian call centres than in the UK such as ‘housekeeping workers’, and huge fleets of company cabs driving people between their home and workplace.
These are additional wage costs – with increasing rent prices in the metropoli of the global south and wage pressure from below, the difference between ‘per agent cost’ in the US/UK and India will have narrowed considerably since the time of the reports quoted above. Most of the union initiatives regarding relocation were limited to protectionist propaganda for the ‘defence of our jobs’, as in the ‘Pink Elephant’ campaign of the CWO (UK Communication Workers Union) when British Telecom proposed to slash jobs in the UK and shift them to India. We are not criticising workers who fight against redundancies and threats of relocation, as at Wanadoo in France in 2005, when the management planned to shift work to Morocco. But too often unions tried to conjure up nationalist sentiments; talking about ‘British quality’ of call centre services and similar bullshit. ‘We already know the answer to any survey that the government has commissioned and so do the British consumers,’ said David Fleming, the national secretary of Amicus (UK trade union). ‘Services will suffer, cost savings will not be transferred to the consumer, poor business decisions will be made in pursuit of short-term cost savings and company brands will be damaged by outsourcing’.10 There have only been a few campaigns where activists tried to break down the national perspective of their unions, e.g. when a US delegation of unionists visited colleagues in India or campaigns of Spanish and Argentinean activists in the early 2000s, when the Spanish telecommunication company Telefonica tried to play workers off against each other on both continents.
The New Workers
Call centre companies shifted jobs in space, causing wages to fall in absolute terms, but also changing the class composition of the workforce. English-speaking call centre workers in India were mainly recruited among young graduates of the ‘middle-waged’ class, with a clear social and cultural distinctions from the general working class. This has not been the case in the US and Europe. Although the wages paid in Indian call centres were very low compared with those in the global north, the wages compared with the general wage level in India were high. This factor, and the general working conditions (night shifts, male and female employment etc.), created the material basis for a fundamental shake-up of generational and gender relations. Working in a call centre, the nineteen-year-old daughter of a teacher or hospital doctor earns more than her father. The fact of having the first job after school or university in a call centre, the night shifts, the technological control and general pressure, the shared flats, the new purchasing power, the expensive food in the neighbouring shopping malls, the long hours in cabs, the frequent job changes, the more open gender relations at work, the burnout, the difficulty of keeping open the prospect of an academic career or finding work as an academic: these are experiences of a new proletarianised middle class generation. To these general experiences others can be added. The following working life story of a workmate we met in one of Gurgaon’s call centres during lunch breaks expresses the experiences of this new generation of workers.
(Female worker, 22 years old, May 2006)
In April 2004 I was still living in Bhopal when I had my first job interview with a call centre company in Gurgaon. After a first interview over the phone I was invited for a second interview in Gurgaon. I went with my mother. The company said that they were interested, but that they currently had no job, that I should wait another week. A friend of mine arranged me a different job, so I moved from Bhopal to Gurgaon. I first had to convince my family, but when my father saw that the flat is fine, they let me go. It was for the first time that I went to a big town. In the following one and a half years, I worked in fourteen different call centres and by changing jobs I increased my monthly wage from 8,000 rupees that I earned at my first job to 20,000 rupees, my current wage. All jobs were outbound, I was calling the US, Canada or the UK. First I had a quite glamorous picture of call centres, you know, free cabs and meals and all. But all that changed after a while, after working six days a week from 2.30am to 12.30pm plus travel time. I started working in small call centre with ten employees, later I worked in companies with up to 2,000 employees. The smaller call centres are less organised, they often do not give you a contract, and they do not pay on time. And do not get promised incentives as well. They also often do not pay the Provident Fund [unemployment/pension insurance], they do not give you a PF-number, although it is obligatory. They also hire more or less anyone who can speak a little English.
In the smaller units I called for Rogers Canada, they do business in telecommunications, or I called trying to convince people in the US to make use of the Government Grant Profit. They are supposed to pay 299 USD into this scheme, but often it turns out to be a con trick. The shift times for the US are tough: you work from 11pm to 6.30am. I called for 3G Network or Onetel, selling mobile phones to private households in the UK. A lot of call centres here call for telecommunications companies.
Most of the call centres had automatic diallers, meaning that you cannot influence when a call is made. Sometimes you have to make 400 to 500 calls per shift. Bigger companies like Infovision or Technova sometimes share a building, so that you have one row of Infovision workers and the next from Technova. Big companies have their own buildings, unlike smaller companies, which often share a single one. It can happen that in one row there are people working for seven different companies. Infovision also has several branches, one still in the US, three or four in India. Some people start working while they are still living with their parents. For them it is pocket money for parties or gadgets. For them it is also not such a problem if wages are not paid on time. But I guess that 60 to 70 percent of the people actually have to pay rent, they came from various places in the North, if there is no money, they are in trouble.
Once at Icode Customer Management wages were not paid in time. It is a small call centre, only 25 people worked there. The management made cheap excuses, said that the client was not paying, that money will come in soon. That happened several times before people got despondent. During a night-shift people decided not to work as long as they were not given their wages. The manager actually went and got cash money from the bank and paid people the next morning. Later several people left this company, now there are only ten workers left. Similar things happen at bigger call centres, as well.
There was trouble in taking leave also. For example my brother was ill and I had to go back to Bhopal. The team leader said it was fine, but when I came back he asked me ‘Who allowed you to take holiday?’ Sometimes I just left the job because I needed a holiday; and took a new job on returning. You can find jobs through internet, newspapers or you hear about them from friends. There are call centres like Wipro or Convergys which are seen as better and more established call centres, also because they have good clientele, for example BT or Orange. The problem is that they are far away from Gurgaon, one has to travel at least two hours plus and then work a ten hours shift. The atmosphere in the call centres is a bit like in college. There is a culture of parties, people share flats, keep in contact via Google groups. Sometimes it is fun, people come to work after a party still drunk, falling asleep, waking each other up when a CIO comes. Sometimes it is childish, even embarrassing. Boys play their games, make jokes about girls. We are also mistreated when calling the US, but mainly from private people, not from employees. We do not know much about working conditions in call centres in the US, also we did not talk about it much. We have only seen the senior US managers from time to time; that is it. When I observed that more and more people are entering into the call centre business I felt that only speaking English was not enough, because so many people could speak English. I learnt French. In call centres you mainly learn about working time and discipline, you are physically busy, but mentally free. You do your task. I also tried to get a job teaching French, but that is difficult and the wages are not that good. I finally joined Evalueserve, here you are under less pressure. In a call centre, if you do not sell, you are fired. A lot of people try to continue their studies while working in a call centre, about 40 per cent study through correspondence. But it is difficult, a lot of people stop after a while. Also for managers working in a call centre is not a step towards a career, they can stay within the industry, but outside, the call centre experience is not valued.
The Lines of Division
Although the experience of workers in English-speaking call centres seems fairly homogeneous, experiences and conditions in the wider sector are not. We see many lines of segmentation within the sector: between in-house call centres and outsourced processes; between English-speaking international call centres and Hindi-speaking domestic ones; between call centre agents and ‘service workers’ (cleaning, driving); between the call centre workers and the other industrial workers situated in the same industrial zones.
Most of the bigger companies not only offshore their work to India, but outsource it to teleservice companies such as Wipro, Convergys, Genpact and IBM. American Express in Gurgaon, for example, has an outsourced process at Convergys; at the same time and just across the street it runs its own in-house call centre. IBM has an in-house call centre and at the same time acts as a service provider for Amazon and various bigger airlines and travel agencies. Wipro employs 1,200 people in the Dell process while Dell is opening its own centre only few kilometres away. It is unclear yet whether Dell will keep on running both processes parallel, but during conversations we heard that workers in the area are also affected by re-locations of their work. Some workers reported that the process they had worked was re-located to a call centre in Hyderabad in South of India.
While workers in English-speaking call centres start with monthly wages of Rs 17,000 and can earn up to Rs 30,000, workers in domestic Hindi speaking centres earn between Rs 7,000 thousand and 11,000. There is a parallel boom in English schools and classes teaching the American accent. Many workers feel compelled to learn another European language in order to compete on the market and counteract the pressure on wages.
Another major wage gap exists between call centre agents and service workers (canteen, security, drivers, cleaners). Their wages are extremely low and their service work is supposed to keep the call centre workers content despite stress and night shift burden. Most of the perks of call centre employees, such as free food, transport, leisure activities, are based on the shoulders of low-paid manual workers. In January 2010 housekeeping workers hired through contractors at the FIS call centre (handling calls for American Express) were paid a basic wage of Rs 3,300 per month, Rs 12 per hour overtime, they received no ESI health insurance card, no Provident Fund – despite both being a statutory requirement.
Image: Site of future Dell office Gurgaon
The spatial proximity of the call centre and the factory is obvious, as obvious as the social abyss that still opens between them. Work in call centres has lost its ‘intellectual’ attractions, it consists basically of industrialised mouth movements and Taylorised emotions, but the social gap between different sections of the working class is significant and can also be expressed in monetary terms: in 2007, while call centre workers earned around Rs 20,000, an unskilled building worker in the Dell call centre building site earned Rs 1,000 to 1,500 per month, working 80 hours a week; a textile or metal worker employed through a contractor earned about Rs 1,500 to 2,500 for the same working hours; the official minimum wage for unskilled workers in Haryana for a 48 hour week was about 3,000 Rupees, a contract worker at Maruti or Honda was paid between Rs 3,000 and Rs 5,000 for 50 to 60 hours per week; a guy at Pizza Hut serving the call centre agents got Rs 3,700 for a 60 hour week.11 The precondition for bridging this gap is that call centre workers start to act as workers. They have started to do so within their sector, but this has rarely crossed into other sectors or become visible to other industrial proletarians.
Capital moves, looking for profitable conditions, trying to escape the contradiction of workers’ collective aspirations and resistance within profit production. In its flight it re-establishes the contradictions on a higher and wider social level. Call centres are no exception to that rule. The allure of call centre jobs in India wore off quickly, along the illusion among capital's representatives that they had found an investment paradise of docile and cheap labour. As in the years of the industrial revolution, the discontent already existing among workers was first voiced by the 'middle class', who voiced it in their narrow-minded moralistic ways.12
Meanwhile call centre workers ‘voted with their feet’. ‘Staff turnover at Indian call centres is worse than that at UK operations, with Indian graduates only willing to stay in a job for an average of 11 months, compared with three years in the UK.’13 ‘An annual attrition rate of 50 per cent plus is par for the course and a company that boasts of an attrition rate of 30 per cent struts about like a prima donna. The attrition is forcing BPO companies to pay more. Wages have risen so quickly in India that it’s not much cheaper in comparison to Canada as an offshoring location.’14 ‘Indian back-office firms are facing a growing challenge of holding on to employees, even as they hire tens of thousands every quarter. Staff tends to account for half of a back-office operation’s costs and the battle for talent has led to an annual 10-15% rise in employees’ salaries. Employees often hop to new jobs for slightly more money, and many do not view back-office work as a career. Companies provide free transport, subsidised meals and housing to retain staff, and try to enliven the environment with musical entertainment, yoga classes and costume contests.’15
This behaviour among workers was also common in Europe during the boom. We only rarely hear of collective steps by workers within the call centres to improve conditions – which does not mean that they don't happen. The following example from August 2005 illustrates the collective and creative nature of possible steps:
Not satisfied with their earnings, some BPO employees feel they can outsmart technology and earn bonuses for themselves. Some employees at Convergys were sacked because they managed to ‘create’ fake favourable ratings apparently from customers of SBC Yahoo, a popular ISP in the USA who has outsourced customer services to Convergys. [...]. Apparently this was discovered when Convergys noted unusual patterns of excellent ratings for some employees. On pinging, it was found that these feedback forms had been originating from an Indian server (used by Convergys, Gurgaon) rather than from the US servers from where they actually should have come. Money seems to have been the greatest lure for such employees, as an excellent rating can get them bonuses of up to Rs 4,000 a week.16
The New Struggles
There have been open collective struggles in call centres in India in particular once wages were not paid in time or workers were sacked. In May 2005, three cops were injured when call centre workers threw stones during a strike at Hope India Ltd. in Mumbai – unfortunately we never found out more about this unrest. In July 2007 workers at Gnome Business Solutions call centre in Gurgaon protested against being dismissed from one day to the other. After a round of slogan-shouting outside the office of the BPO – Gnome Business Solutions at the Global Business Park on MG Road, Gurgaon – the management issued the sacked workers post-dated cheques by way of a final settlement. For many among the retrenched, this wasn’t the first jolt of their young careers. Many in this group were earlier working with another call centre, Avancore. Last Diwali, it declared a two-day holiday. When they returned to work, the call centre had vanished.17
Image: View from a call centre toilet (tents accomodate building workers and their families), Gurgaon
A similar incident took place in NOIDA on 10 January 2010, when a fake BPO company took money for employment from some students. When the students noticed the scam they did not allow the company owners to move out the building till they paid them back. Eight students suffered minor injuries in a subsequent clash with the police personnel at Knowledge Park-I. The students alleged that the police were helping the company and ignoring their complaints. We documented an actual collective strike at a domestic call centre in Gurgaon in the Hindi workers’ newspaper Faridabad Majdoor Samachar:
Sparsh BPO Service Worker
(409 Udyog Vihar Phase 3)
We currently operate through 20 state-of-the art facilities across nine locations in India. Our dedicated workforce of over 16,000 motivated professionals provides qualitative solutions in the areas of transaction processing and calls centre services, aiming to achieve excellence in every transaction.18
The call centre is in a 12-floor building, several thousand workers are on the phone 24 hours on three shifts, phoning for BSNL, Airtel, Airsale, Reliance Com, Orient Bank of Commerce. For 26 working days per month they get Rs 4,800. After eight-hour shifts they are often made to stay two hours longer, for which they are not paid. The company does not pay for transportation and Rs 1,000 per month is deducted form the wages of those workers who use the ‘employee cabs’. In addition Rs 210 is deducted for PF and Rs 80 for ESI – but no ESI card is given. The food break is only for 15 minutes – there are two 5 minutes breaks for tea. There is never enough time, but no matter what, you are supposed to work. You cannot make the customer wait, that’s what they say. Against this the workers stopped working at the end of March 2009, they stopped it for three days. They went inside the office, but they did not log in. The management reacted by smashing 4-5 computers and trying to blame the workers for it, saying that they will file a police case and send them to jail. Bit by bit they started to kick people out – in the end there must have been about 2,000 workers. Actually a lot of workers handed their resignation, but the company refused to take it – instead they said that the workers just left the job. After having worked there for more than two years the employee went to the office to get his PF form signed, but they just threw it away and said that he left the job without giving notice and he won’t get the PF. The company keeps 200 workers for housekeeping. They work 12-hour shifts, 30 days per month and get only Rs 4,887 – no ESI and no PF. The company has another office at 195 Udyog Vihar Phase 1. The employees work for Vodafone, Shubh Yatra, Bhartiya a Jivan Bima Nigam and some others.19
Here things get even more interesting. Sparsh closed down its Gurgaon call centre soon after this strike and relocated it to a small town in Rajasthan. About two years later several hundred kilometres away Sparsh again faced workers’ anger:
AJMER: Employees of state’s first call centre – BSNL – went on strike accusing the organization of illegally deducting money. They said they got payments lower than what was promised to them during their appointment. The call centre was inaugurated by union IT and state telecoms minister Sachin Pilot. About thirty people working at the Sparsh call centre walked out of the office on Friday morning. They shouted slogans against the officials. ‘They promised to pay Rs 5,500 at the time of appointment but they are paying us only Rs 3,700’, said Minali, an employee. The workers also accused the HR and operation officials of harassment: ‘They have zero tolerance. Even when the system fails they deduct half day’s salary’, another employee said. When contacted, the officials refused to talk and said there was some misunderstanding, which they were trying to solve.20
Another dispute at the other end of the globe expressed the increasing internationalisation of call centre companies concretely and – taking companies like Mittal and Tata into account – the development of an intertwined multinational management of capital. In November 2009, in Timisoara, Romania, the French telecoms giant Alcatel-Lucent announced that one third of the workforce would be outsourced to the ‘Indian’ IT-service giant Wipro by early 2010. Wipro runs major call centres in Gurgaon and other cities in India. The workers in Romania then formed a union to defend their rights and ‘terms and conditions’. On 10 November 2009 a joint action of Alcatel workers in France, Germany, Italy and Romania took place against job cuts. In September 2009 Wipro shut down an IT research and development-centre in Sophia Antipolis, France. About 60 engineers got the sack.21
The Flight into the Desert
We can see two main current structural problems for capitalists: where to find a fresh supply of labour? And where to find one which can be combined with a new mode of production, i.e. a new productivity regime? By the mid-2000s capitalists started to complain about wage pressure and labour shortages in China and other Asian countries. This is obviously a shortage of a certain kind of labour. Capitalists wanted to fly forward, to capture a new virgin section of the working class, i.e. peasant workers who can be subjected to intensified conditions of exploitation. However the regions of the globe where capital could find such a working class have become sparse. Meanwhile the ‘Toyotism’ hailed in the 1990s, which was supposed to revolutionise the old ‘Fordist’ mode of assembly line manufacturing of the ‘American century’, had lost its ‘lean sheen’ by the turn of the millennium. Manufacturing today is more dependent on the brutal pace of the assembly line than ever before.
Call centres quickly ran into this structural problem of a fresh labour supply and production model. By the mid-2000s the propagandists of capital announced that call centres would move away from towns like Gurgaon, Bangalore or Manila – where they had just arrived – and settle down in smaller towns and rural areas in order to cope with wage pressures and ‘high office rents’. This could never happen, because skilled mass labour in these areas was available only in theory. Capitalists’ desperation to find these untouched reservoirs of labour turned farcical when trying to revalorise fields of social disintegration and decaying dictatorships:
Now, India’s IT revolution has arrived in Kashmir with the opening of the state’s first call centre, in the city of Srinagar. With 500,000 unemployed, there is no shortage of willing job applicants, while wages in Kashmir are among the lowest in India.22
‘We believe that our country is an ideal destination to start a BPO because of the conducive atmosphere we have. To begin with, we have a stable government that is eager to set up an outsourcing industry. Apart from Genpact, we are also in talks with Wipro and a few other players to start their operations in Bhutan,’ said Kezang, executive director, Ministry of Information and Communications.23
Similarly the call centre industry in India repeated the propaganda of ‘tele/home-work’ as an alternative mode of production to the mass concentration of call centre workers under one roof. The industry had churned out this futile talk and had failed to turn it into practice in both the US and Europe before.
‘With just one laptop or desktop computer with internet and phone connections, people could operate from their rooms, attend to inbound calls that otherwise land at the call centre. With this, housewives, who would never otherwise dream of joining a BPO, would be able to take jobs and do it from their homes,’ said Mike Manson, director of the ‘Innovative Company’. ‘Virtualisation of voice technology would help setting up of one-seater or 3-5 seater micro BPOs in tier 3 and 4 cities from where the BPO companies are drawing talent pool,’ said Sriram Srinivas, vice-president. This would not only benefit the employee to save on overheads such as rentals and high cost of living in metros like Gurgaon but also helps the company reduce cost on things such as employee transportation expenses.24
Experiences in the US and Western Europe taught us that even in call centres, capitalist production is still mainly a ‘socially enforced’ type of productivity: despite rent costs the mass office is still more productive due to mass cooperation, flow of creativity, discipline and surveillance.
Having to face up to lack of fresh labour supply and the general absence of new modes of production, capital’s flight ahead became more and more of a disoriented stumbling. And then the big crunch approached, with Gurgaon’s call centre workers among the first to see big shit hitting the global fan in 2007/2008:
In a glass tower on the outskirts of New Delhi, dozens of young Indians are on the telephone, calling America’s out-of-work, forgetful and debt-stricken and asking for cash. ‘Are you sure that’s all you can afford?’ one operator in a row of cubicles asks politely. ‘Well, how do you take care of your everyday expenses?’ presses another. Americans are used to receiving calls from India for insurance claims and credit card sales. But debt collection represents a growing business for outsourcing companies. Armed with a sophisticated automated system that dials tens of thousands of Americans every hour, and puts confidential information like Social Security numbers, addresses and credit history at operators’ fingertips, this new breed of collectors is chasing down late car payments, overdue credit card debt and lapsed instalment loans. Debt collectors in India often cost about one-quarter the price of their American counterparts, and are often better at the job, debt collection company executives say.25
The Big Bang, October 2008
The financial crash of Autumn 2008 shook the main sectors of call centre work in particular and the global wage cascade in general. In the glass towers of Gurgaon’s industrial areas the impact of the meltdown was direct: the conditions of the call centre workers phoning for the US and European market worsened suddenly. And it was not only the call centre workers who felt the blow: their unknown brothers and sisters in the garment sector were also very much aware of the dwindling orders coming from the export markets. The political climate changed and one of the populist reactions of the Obama administration – apart from demonstrative vegetable growing on the lawn of the White House teaching the unemployed working class in the USA their future modes of survival – was the protectionist promise that ‘jobs will stay in the US in future’. Was it a promise or a threat? Actually the crisis pushed down wages in the global north to such an extent that they became close to competitive again compared with IT service-related wages in the south. The division of labour had to be reconfigured and capitalists had to transform the pressure of the crisis into a new global wage scale.
The Union of Information Technology Enabled Services (UNITES) estimated in January 2009 that between September and December 2008 10 thousand jobs were lost in the IT industry, with a further 50 thousand cuts expected in the first half of 2009. As if to mimic the Enron scandal that buried the New Economy bubble in the US, the Satyam scandal came at the right time to finish off the last doubts about the state of the sector in India.
Rajeev, a Senior Customer Care Executive at Convergys, has worked at five different call centres in the last seven years. He’s looking for a change again, but this time not out of choice. ‘This is the first time I feel I am heading nowhere. I have been asked to leave because of something I haven’t done,’ he said. Rajeev is one of the 450 employees fired in the last two weeks by a Gurgaon BPO called 24/7 Customers. Reason being that this UK-based mobile phone company has decided to cut back its India operations. The Orange crisis has led to lay-offs at two other Call centres, Convergys and EXL services. And this comes after 400 people were let go last month by another BPO giant, Keane India, after a merger and a scaling down of size.26
Mid-tier IT company Hexaware Technologies is in the process of shutting down its Gurgaon centre where about 130 employees currently work.27
Convergys is shutting down its Malad facility in Mumbai which employs around 400 people, Patni Computer Systems laid off 400 people citing non-performance, while Fidelity Management and Research Company India plans to shut down its Gurgaon facility by September this year which employs around 350 people.28
We spoke to a call centre worker during his cigarette break in front of Convergys in June 2009, asking him about the impact of the crisis:
Since this recession has started, companies are not offering more than Rs 16,000 – 17,000. Before this, they were offering Rs 20,000 plus. And apart from this they are making people work for longer hours. If 50 companies were hiring, now only 10 or 15 companies are hiring. American Express, for example, chucked out a large number of employees and hired new batch, paying them a lot less. We have even seen a process of layoffs at our company. Recently 50 people were asked to leave because of the recession. They were getting a very good salary. They weren’t new, but still they had to leave. The situation is not as bad compared with the US or England. At least the people are able to manage – able to survive. And I think, as the recession is getting over very soon – another 5-6 months, things will definitely change.
They did not. In November 2011 in Gurgaon alone around 2,500 workers at Nokia-Siemens Networks lost their job, most of them paid salaries only slightly above the minimum wage. Globally the company cut over 20 thousand jobs between November 2011 and February 2012. In Germany 3,000 workers were sacked. Blame for the job loss was placed on a ‘price war’ with Chinese vendors.
Call centre companies in India tried to translate the (credit) crunch into a (literal) squeeze of their workers, by reducing space per person in call centres and cabs, by cutting wages and additional perks.
The IT-enabled services (ITeS) firms are taking stringent measures to cut costs. They are reducing space per employee, and decreasing the size of common areas like cafeterias and conference rooms. At a Gurgaon offshore office, space per employee has been reduced to 60 sq ft from 100 sq ft; at large IT companies, 125 sq ft per employee is a standard. Workstation width has dropped from 3-4 feet earlier to 2 feet. All this is leading to severe work related stress. ‘I can’t move my hands in the fear of hurting someone. And all day one has to hear colleagues talking about issues from boyfriends to food recipes to childcare, which is not just distracting, but irritating,’ says Rajsekhar. [...] Margins in business process outsourcing (BPO) have been stagnating at 18 percent for the past years even as revenues declined in 2011. For IT services the drop in profitability is worse: margins have plunged from 32 percent in 2006 to 18 percent in fiscal year 2011.29
Talk about ‘on-shoring’ made the rounds from 2010 onwards, meaning that US or UK companies closed their call centres in India and re-opened them in the US/UK. Most of these cases were blown up and didn’t represent a major trend. The reasons given for the ‘on-shoring’ are often populist, catering to both the patriotic sentiments and the ‘client pride’ (local accents, ‘good quality’ etc.). In general the share of IT-BPO service work done in India still increased, the global market share stood at about 55 percent in 2010. Nevertheless, with the crisis deepening in the north some shifts were taking place. High unemployment levels have driven down wages for some low-skilled outsourcing services in some parts of the US, particularly among the Hispanic population. Genpact, India’s main call centre operator, employed around 1,500 call centre workers in the US in 2010 and announced that ‘company expected to treble its workforce in the US over the next two years.’
‘We need to be very aware [of what’s available] as people [in the US] are open to working at home and working at lower salaries than they were used to,’ said Mr Bhasin, the chief executive of Genpact. Wipro, the Bangalore-based IT outsourcing company, started to recruit workers in Europe, the Middle East and Africa during the global economic downturn.30
Similar news came in from the UK. In June 2011 the banking giant Santander announced plans to bring its call centres ‘back’ to the UK: 500 jobs would be created by the switch of call centre work from India to staff based in the UK cities of Glasgow, Leicester and Liverpool.
This year, BT has also created several hundreds of jobs in the West Midlands through the opening of a new call centre in Sandwell in the West Midlands. UK insurer Aviva moved back some jobs from its Indian BPO partner WNS to Norwich, UK, earlier this year. Although it did not give a reason, people familiar with the matter said it was facing quality issues. In June 2011 the Indian firm Aegis announced to create 600 jobs by opening call centre in Manchester, UK.31
Not only ‘jobs’ come ‘back home’ to the US: in some cases call centre workers are brought over from India, employed by ‘Indian’ call centre operators within the US.
Companies such as Tata Consultancy Services, Genpact and Infosys are the largest users of the US-American H-1B visa program and have collectively brought as many as 30,000 workers into the country in 2010. The workers are often paid ‘home-country wages’ in America. That’s as low as $8,000 a year with housing allowance. As in the UAE, employers keep the visas – so the workers can’t bargain for wages, and if they lose their job they have to leave the country.32
The Future Potential for Class Re-Composition
Strolling through Gurgaon, the main revelation is that the planners of the industrial zones have not studied European revolutionary periods in the late 1960s or the struggles in Latin America or the movements in South Korea in the 1980s. Or they think that due to the generally deeper divisions in Indian society, putting call centres with ‘student-workers’ right next to huge motorcycle and garment factories will not create explosive potential in the event of bigger turmoil. While we were distributing a call centre workers’ leaflet in 2007, the temp workers of the Hero Honda factory organised a wild occupation of the plant which went on for five days.33 Right opposite the factory is a bigger call centre with 1,000 young students, capable of communicating in international languages and with access to modern means of communication, having to work ten-hour night shifts under severe pressure, while looking at the police sleeping in the shadows of the occupied factory. Only a couple of weeks later we heard of trouble in the call centre because incentives were not paid in time. We were not able to verify the rumours but during a visit at the site a lot of young workers complained about having to travel and wait for two hours in cabs before shifts started and about delays in wage payment. During times of revolutionary upheavals the students first had to ‘discover’ the workers, but here they work right next to each other and are in similar ways connected to the global movement of capital, e.g. the IBM call centre is right next to the Delphi plant, the world’s biggest car supplier, and in the US both companies are in deep economic shit.
Image: Chai stall in Gurgaon
In October 2008, at one point in time, workers in one space – who might otherwise have thought that they have little in common but chai stalls – faced a common situation: cuts in bonuses or piece-rates, suspension of free company meals and transportation, the threat of job cuts. The potential for a socially explosive tea-party of English-speaking call centre night-shift youth, migrant garment and construction workers and young skilled workers in the car part plants entered the Industrial Model Towns – a mass base of actual ‘internal threat’. If call centre workers and other industrial workers would come closer together in a movement, this would be a true cultural revolution of the hierarchical relationship between intellectual and manual labour in India and would give the working class struggle a whole different dimension and potentiality. What would be the material condition for such a coming-together, apart from the impact of the crisis?
We think that the workers in domestic call centres could play a specific role. Their wages are low, often even lower than the wage of (skilled) garment workers – but they use the same means of production as the international call centre agents and could therefore ‘explain’ the form of exploitation to other industrial proletarians who otherwise see call centre ‘staff’ just as the better-dressed middle-class youth. Another direct (international) link between call centres and other sections of workers is outsourced ‘admin work’. Workers in these ‘back offices’ not only handle ‘private consumers’, but form part of an actual global productive cooperation. For example a back office in Gurgaon organises all shift schedules for the German railways – Deutsche Bahn. In June 2011 India’s largest IT-related service provider Genpact got a seven-year contract from Nissan. The centre in Gurgaon will ‘provide payroll, benefits, staffing, training and other key HR services to Nissan’s 54,000 employees. Genpact already manages procurement for Nissan from its offices in Gurgaon.’ In July 2011 Capgemini opened a back office in Gurgaon with 4,500 seats; among other things the centre will ‘deliver Global Order Management services to Nokia Siemens Networks to support the company’s global Supply Chain Management.’34
Apart from this we can also refer to the development of a global (proletarian) youth movement, expressed in various ways, from university occupations in the UK and Chile, to Tahrir and Tottenham riots and the ‘Occupy’ movement. This movement will find some repercussions within the open-space offices and will reverberate under the head-sets of the global call centre generation. During 2007 we distributed about 1,000 pamphlets in front of call centres in Gurgaon – at the time workers surely complained about the general boredom of the job, but their anger seemed to be rather individual. Since then the world has changed, the global crisis has given a mighty blow to the relation between individual fate and fate of society. Based on these material connections of the production process (global back offices) and based on the developing youthful anger, organised efforts around this existing international communication network are necessary and possible. Let’s organise around the proletarian conditions within it. Let’s help to turn it into the ‘telegraph stations’ of the currently emerging global strike wave. For Workers’ Self-Emancipation – For Communism!
This text is adapted from a longer text which forms the introduction to the 2012 Indian edition of Hotlines: Call Centre Inquiry/Communism, (available: http://www.nadir.org/nadir/initiativ/kolinko/lebuk/e_lebuk.htm). Since the first edition of this book was published in 1999 our collective efforts changed with the world around us. We distributed leaflets in front of the Hewlett Packard call centre in Holland in 2002. Five years later we stood in front of a call centre of the same company in Gurgaon, India, distributing a small pamphlet which summarised some of the call centre workers’ struggle experiences in Europe. We worked in market research call centres in London in 2003 and in 2007 relocated ourselves to a market research call centre in Gurgaon, where real wages were significantly higher at the time. Between 2003 and 2007 we tried to extend the ‘inquiry and collaboration’ of communist collectives through a newsletter; www.prol-position.net. We attended international meetings and took part in the translation of and debate on Beverly Silver’s book ‘Forces of Labor’, (see: http://www.wildcat-www.de/dossiers/forcesoflabor/fol_preface.htm), which inspired us to relate practically to the emerging global character of the working class. Some of us went to China (see: http://www.gongchao.org), others to India (www.gurgaonworkersnews.wordpress.com). We kept in touch within the German ‘Wildcat’ political collective (www.wildcat-www.de). By the end of the decade times started to rock again... In these times we need collectives engaged in working class reality, with open minds and hearts. Get a job together, read Marx, write job diaries, share your experiences and let's meet in the future... Stay tuned gurgaon_workers_news AT yahoo.co.uk
2 David Streitfeld, ‘A Town’s Future Is Leaving the Country The 1,500 residents of Clintwood learn the meaning of outsourcing the hard way.’, Los Angeles Times, 28 March, 2004, http://articles.latimes.com/2004/mar/28/business/fi-outsource28
3 Datamonitor, 21 March 2005.
5 The New York Times, 8 July 2005
6 The Times, 12 May 2005.
7 The Times Business, 2 May 2005.
8‘ Outsourcing’, 7 February 2004.
9 BBC, 11 December 2003.
10 BBC, 12 February 2005.
11 All figures relate to monthly wages unless specified otherwise.
12 ‘Author Praful Bidwai said that in effect the centres reduced the young Indian undergraduates to "cyber-coolies". They work extremely long hours badly paid, in extremely stressful conditions, and most have absolutely no opportunities for any kind of advancement in their careers,’ Mr Bidwai told BBC. ‘It’s a dead end, it’s a complete cul-de-sac. It’s a perfect sweatshop scenario, except that you’re working with computers and electronic equipment rather than looms or whatever.’ BBC, ‘Call centres "bad for India"’, 11 December 2003, http://news.bbc.co.uk/1/hi/world/south_asia/3292619.stm
13 BBC, 12 February 2005.
14 The Telegraph, 20 April 2005.
15 The Hindu, 8 July 2004.
16 Times of India, 21 August 2005.
17‘ Industry leaders say the episode is part of a larger trend. According to Deepak Kapoor of BPO News, an industry-related website, a study done by the organisation shows more than 60% of small BPOs in India – those employing between 20 and 100 people – close down within months of their launch.’ Times News Network, 4 July 2007.
19 Interview published in Faridabad Majdoor Samachar no.267. ‘Faridabad Majdoor Samachar is a monthly publication in the Hindi language. In 1982, we began publishing 1,000 copies in 2 page format. In 1993 we began to publish and distribute 5,000 copies of the paper each month in Faridabad and Okhla Industrial area of Delhi. Since 2007, the number of copies has increased to 7,000 since we now also distribute the paper amongst factory workers in Udyog Vihar, Gurgaon. Between Faridabad, Okhla, and Gurgaon, there are two to two and half million factory workers.’ http://www.faridabadmajdoorsamachar.blogspot.co.uk/p/about-fms.html
20 Times of India, 22 June 2011.
21 Blog of the Wipro/Alcatel union in Romania, http://blog.sindicatalu.ro/?p=117 Article on Wipro job cuts in France, http://www.humanite.fr/2009-09-16_Politique-_-Social-Economie_Hold-up-a-Sophia-Antipolis
22 Economic Times,12 August 2011.
23 Financial Express, 24 August 2011.
24 Financial Express, 13 May 2011.
25 Economic Times, 24 April 2008.
26 NDTV,13 July 2008.
27 Sify, 14 August 2008.
28 Economic Times, 17 August 2008.
29 Financial Express, 3 August 2011.
30 Financial Times, 17 August 2010.
31 Economic Times, 4 July 2011.
32 Financial Times, 20 May 2011.
34 Economic Times, 27 July 2011.