A struggle is brewing between workers, trade union leaders, and the management of one of India's largest textile manufacturing firms in the Bole-Lemi Industrial Park.

Jay Jay Textile Plc's staunch posturing against trade unions has sparked a broader debate over labour rights and industrial growth in a country where manufacturing contributes less than seven per cent to GDP. Several factories housed in the industrial parks are seeing their union certification efforts derailed, prompting leaders of the Industrial Federation of Ethiopian Textile Leather & Garment Worker Trade Union to submit a contentious three-page letter to the Addis Abeba Labor Enterprise & Industry Bureau.

However, experts urged that labour unions could help achieve industrial peace if established in ways to address employers' concerns.

In this missive, the Federation’s leaders detailed their unsuccessful attempts to unionise workers and urged the possibility of adopting alternative measures.

Angesom Gebreyohannes, the Federation’s president, acknowledged that proceeding with union formation could spark tension between management and workers. Instead, he outlined an alternative strategy of forming alliances with international buyers, particularly in the United States (US), to boycott products made by companies disregarding labour rights.

"We'll be using this bargaining chip," Angesom said, emphasising the Federation's growing frustration with the situation.

The discord in the textile industry, particularly at Jay Jay Textiles, has involved several entities, including the Confederation of Ethiopian Trade Union (CETU), the Ethiopia Investment Commission (EIC), and the Industrial Park Development Cooperation (IPDC). However, their collective efforts have so far proven futile.

CEO of Jay Jay, Karuprayil Purushothaman Raju, remains opposed to union formation, arguing that unions often encourage strikes and demand unreasonably high worker privileges, leading to a plunge in company productivity.

"Experiences of other countries prove likewise," said Raju, referring to instances where unionisation resulted in operational disruptions.

Despite its modest contribution to Ethiopia’s economy and accounting for only five per cent of total export revenues, the manufacturing sector has seen a recent 24pc downturn (118 million dollars), a worrying trend for this emerging sector. Jay Jay Textile, a company specialising in children's apparel, commenced operations in Ethiopia in 2014. It reported a dip in revenue to 22 million dollars following Ethiopia’s delisting from the African Growth & Opportunity Act (AGOA), leading to a 10pc downsising in the workforce of 8,000.

"Revenue has been falling nearly a quarter yearly," Raju lamented to Fortune.

He sees the Federation's demands for union formation as unwarranted since the employees were content with the existing Workers’ Council established by the company.

"We can't have someone from outside tell us what to do," he told Fortune.

An investigation by the Worker Rights Consortium (WRC) - released in 2018 - accused Jay Jay Textile of "unfavourable work conditions". The report exposed wage deductions, excessive overtime, inadequate breaks, limited restroom facilities, and substandard meals. It revealed cases of workers collapsing from exhaustion at their workstations.

Angesom argued that these circumstances underscore the need for effective worker representation, particularly in the absence of a minimum wage law. He views trade unions as a crucial tool for improving collective bargaining power.

"Trade unions are a safety net to create a strong bargaining power," he said.

However, despite the Federation’s persistent efforts, Jay Jay's management remains defiant, as evidenced by their letter to the International Labour Organization (ILO). They argue that the company's existing Workers' Council fulfils their obligations, making trade unions unnecessary, and further, the Federation lacks authority to demand the establishment of a union.

In response, ILO officials reiterated their mission to urge Ethiopian authorities to fulfil the country’s commitment to the national labour rights conventions they signed, although they do not take legal action.