Formed under the guidance of spiritual leader Guru Vagbhatananda and taken forward by those who believe in communist ideology, Uralungal Labour Contract Cooperative Society (ULCCS) is a paradox. Employing 18,000 people, ULCCS is Asia’s largest and the world’s second-largest company in the cooperative sector. At its helm for over three decades is Rameshan Paleri, who deftly navigates the complexities of this mega construction company, simultaneously managing over 800 projects. As ULCCS celebrate its 100th year, Rameshan shares with TNIE the story of ULCCS’ formation, its challenges, and future plans
Can you explain the basic philosophy of Uralungal Labour Contract Cooperative Society Ltd (ULCCS) and the circumstances that led to its formation?
ULCCS was formed in 1925. That was a period of widespread superstition and social injustice. Education was scarce and people struggled to meet basic needs like food, shelter, and clothing. The society’s formation was inspired by Vagbhatananda Gurudevan, a renaissance leader in Malabar. Fourteen men, moved by his speech, invited him to Karakkad in Uralungal, where he addressed the local community.
These 14 men formed the society with an initial capital of just 34 paise, which has since grown to Rs 5,000 crore. ULCCS has its roots in the institution initially named ‘Koolivelakarude Parasahaya Sahakarana Sangham’. Founded during British rule, the society’s name was changed later.
The society was established to combat caste discrimination, exclusion, superstitions, and black magic practices. True to its founding principles, the institution continues to welcome people from all sections, communities, and castes.
What kinds of work were taken up by these 14 men?
Initially, the 14 founding members took up small jobs to support the local community. These tasks included erecting kaiyala (bund) and veli (fence), constructing small roads, and other minor infrastructure projects. As Kerala grew, so did Uralungal, expanding its scope and services.
What was the next phase of growth?
The next phase of growth was marked by significant worker participation and leadership. Labourers worked tirelessly to build the institution, focusing on basic necessities like food and shelter until the 1960s and 1970s. Once these needs were met, Uralungal helped its members achieve other goals, developing a new work culture emphasising on teamwork, ownership, and responsibility. Notably, the organisation has never experienced a labour strike due to this unique work culture. Every employee knows that they are an integral part of the company.
When did the professional turn happen at Uralungal?
The turning point for Uralungal occurred after 2000. This transformation was catalysed by a pivotal project in Vadakara, specifically at the Chorode Gate, where a notorious ‘S’ turn and single-lane railway crossing caused immense hardship for residents and travellers alike. The challenges posed by this bottleneck made people’s representatives and villagers approach Uralungal, tasking them with completing the project in a time-bound manner.
Despite lacking engineers, skilled workers, and specialised machines at the time, Uralungal rose to the challenge, demonstrating exceptional teamwork and determination. The successful completion of the national highway project within the specified timeframe and to high standards earned Uralungal a stellar reputation.
This breakthrough marked a revolution for the organisation, prompting the hiring of in-house engineers and the acquisition of specialised machinery, ultimately propelling Uralungal to new heights. With 18,000 workers and with 700-800 contracts, both big and small, being executed simultaneously, our management system plays a crucial role. This system, which includes technical and other aspects, enables us to manage multiple projects efficiently.
How are shares in the Uralungal society distributed?
Membership and share distribution are crucial aspects of our society. Initially, memberships were offered to workers employed in quarries, as they were the primary source of labour. This practice continued until the 1970s. Now, our membership policy has evolved. New workers join as non-members and, after two years of service, are eligible for membership and shareholding. This applies not only to our labourers but also to our engineers, who too are offered memberships. This inclusive approach ensures that all contributors to the society’s growth and success are recognised and rewarded.
Uralungal caught public attention when it returned the balance amount after executing a project…
Yes, that’s true. We returned Rs 17 crore for the Thondayad flyover project in Kozhikode city. We work based on estimates, and if we complete a project below the estimated cost, we return the difference. For instance, if we take on a project worth Rs 100 crore and complete it for `80 crore, we return `20 crore. That’s our commitment to honesty. We don’t inflate costs, unlike others who might hike the estimated cost from `80 crore to `100 crore or even Rs 120 crore. At Uralungal, we stick to the actual cost. This incident gained public attention because a newspaper reported it, highlighting our unique approach to transparency and honesty.
It’s said that members were required to abstain from alcohol. Is this rule still followed?
Yes, it is. Discipline is crucial among our members, from workers to top board members. This applies to fiscal discipline as well. We’re strict with financial dealings and measurements. Our organisation’s value system is high, enabling us to complete projects ahead of schedule with top quality.
Malabar has been a hub of many cooperative movements in Kerala. Several, like Dinesh Beedi and Raidco run by the CPM, have declined but ULCCS has thrived. What’s the difference?
That’s a good question. To stay ahead, we must anticipate changes and adapt accordingly. We must adapt to changing times and embrace new technologies. For instance, Dinesh Beedi should have foreseen the decline of the beedi industry and diversified their business. When JCBs were introduced in India, we adopted the technology despite initial concerns that it would displace labour. Instead, it increased productivity and created more jobs.
How did ULCCS adapt to changes?
The year 2008 marked a significant turning point for us. As the number of educated workers in the society increased, reaching almost 95-98%, we realised that not everyone could be a labourer. Most job applicants were educated, and even the children of our workers were highly educated. This led us to explore new opportunities, resulting in the development of an IT park.
Have heard that ULCCS was ridiculed for starting an IT park…
(Smiles) Yes. Now everyone admits that our IT park has become a success story, contributing significantly to the development of the Malabar region.
Communist movements have historically resisted labour displacement arising from mechanisation. Did you face conflicts when introducing JCBs?
There were some apprehensions initially. But we created more jobs after adopting JCBs. Between 1998 and 2000, we provided employment to over 2,000 people. Labourers were insecure about losing jobs to mechanisation, but when we proved them wrong, they began to trust us.
What’s the relationship between Uralungal and CPM?
Uralungal, headquartered in Onchiyam, has a strong connection with the communist movement. Our organisation was founded by social reformer Guru Vagbhatananda, and Onchiyam’s history of revolution has had a lasting impact. However, it’s essential to note that elections within Uralungal have never been politicised.
Are all Uralungal members communists?
No, not everyone at Uralungal is a communist. Personally, I am a communist, but our organisation maintains a neutral stance, avoiding any political bias. This impartiality has earned us widespread acceptance. In our region, the panchayat (Onchiyam) is run by RMP, and Azhiyur (a neighbouring panchayat) is led by IUML. People from all political backgrounds prefer to assign projects to ULCCS because they know we deliver excellent results.
Are you a CPM member?
No, I never took a membership. I don’t have the time for it. But I am a communist.
Have heard ULCCS received the maximum number of projects during the UDF rule. Is that true?
Yes. He (the then Chief Minister Oommen Chandy) appreciated our genuine and sincere work, which led to him entrusting us with a `1,000-crore project. We successfully completed a project in 16 months, ahead of its 30-month schedule. This impressed Oommen Chandy who then assigned us additional projects to be completed before the elections. And we did.
You have interacted with Oommen Chandy from close quarters. What were his specialities?
Whenever we met, he would acknowledge and appreciate our work. That shows his ability to appreciate good work regardless of political affiliations. Our relationship with Oommen Chandy was strictly professional.
Did Chandy award projects to ULCCS without tender?
Yes, Oommen Chandy directly awarded us projects without tender because he trusted us. Recently, we received the township project for rehabilitating Chooralmala landslide victims without a tender process. That’s because governments want quality results.
Congress leaders have alleged that Uralungal is a benami company of CPM, that it uses Uralungal to convert black money to white...
It’s unfortunate that baseless allegations are raised, disregarding our contributions. We’ve provided jobs to 18,000 people and support around one lakh individuals. Our work speaks for itself, with no corruption allegations against us. We even reconstructed the Palarivattom bridge quickly, staying true to our ideology. If there were any truth to these allegations, the government would have taken action.
How is the relationship with current CM Pinarayi Vijayan? Has he ever made any kind of demands, like hurrying through a project?
Pinarayi Vijayan has been very supportive, particularly towards labourer enterprises. He provides guidance and assistance whenever there’s a problem, demonstrating his commitment to the community. While he rarely asks us to expedite projects, there were two instances — Thalappady and Guruvayur projects — where he requested us to hurry.
Recently, Amit Shah praised Uralungal, which is surprising given its Leftist links. Union Minister Nitin Gadkari too had praised ULCCS for having completed the NH 66 stretch in Kasaragod ahead of schedule...
Amit Shah’s praise was based on our performance report, which highlighted our contributions to the cooperative sector. Union Road Transport Minister Nitin Gadkari, praised us because we delivered quality results ahead of the deadline. Our work on the Thalappady-Chengala stretch is nearing completion. Timely completion helps reduce expenses and commuter hardship. Both were appreciations beyond political leanings.
What’s the secret to ULCCS’ success, considering the cooperative sector’s dependence on ideological backing and selfless dedication?
Discipline is the key. Our success stems from adhering to our constitution and bylaws. Everyone, regardless of position, is held accountable for upholding these rules.
Disciplinary actions are taken when necessary, ensuring fairness and transparency. This strict adherence to rules fosters discipline, leading to our success. Additionally, our employees receive comprehensive benefits, motivating them to perform well.
There’s a common perception that Malayalis are less inclined to work hard in Kerala but are willing to take on challenging jobs abroad. Do you agree?
I disagree. Take Uralungal as a case study. Our employees, mostly Malayalis, demonstrate exceptional work ethic. The key factor driving Malayalis abroad is job security and the desire for a better life. If they can find stable, well-paying opportunities in Kerala, there’s no reason for them to leave. In fact, Malayalis prefer to work in Kerala. With the right opportunities, they will excel.
Normally, appointments made in cooperative societies are politically managed. Do you get such recommendations?
Our appointments are not based on political affiliations. We do receive recommendations and consider the ones we get. But once appointed, individuals must adhere to our norms. If they fail to comply with our work culture, we take disciplinary action. We maintain our independence and don’t allow external interference.
How many projects are currently under way at Uralungal?
We have around 800 different projects currently. Our success lies in meticulous planning, with well-defined timelines for commencement and completion. Our directors are assigned specific responsibilities, ensuring active involvement beyond board meetings.
What is Uralungal’s vision for the next phase?
Our primary objective is to establish Uralungal as a leading institution in the construction sector. We aim to integrate advanced mechanisation, bolster our engineering wing, and enhance efficiency. Financially, we target a turnover of `10,000 crore within the next five years.
While Uralungal may not have direct political affiliations, as a cooperative sector entity, it presents an alternative to corporate-driven markets. Can you elaborate on the underlying politics?
Unlike traditional corporations, where profits accrue to a single individual, our cooperative distributes profits among 18,000 members. This mirrors the Mondragon model in Spain, where the largest labour contract society achieved 6% growth during the 2008 recession, while other nations experienced negative growth. A cooperative’s primary goal is to ensure that profits benefit all members. We are the second-largest labour society in the world, after Mondragon.
Corporates thrive on fast decisions by top management. How does Uralungal, as a worker-owned cooperative, take key decisions? Has anyone quit the board because of a difference of opinion?
Our decision-making process is collaborative, ensuring everyone is equally responsible for implementing the agreed decisions. The process involves considering all opinions, studying new ideas, and consulting experts to review them. This approach has contributed to our steady growth and has allowed us to move forward without significant disagreements.
How does Uralungal approach technological updates?
We have a dedicated research wing. We’re adopting an approach inspired by the Mondragon model, where a single apex body oversees R&D and university and industry collaboration. It enables seamless technological updates and training, ensuring our industry requirements are met.
Have you analysed the sectors that can significantly contribute to the state’s economic growth?
Yes, we’ve given this aspect considerable thought. Our success stems from the upskilling opportunities we provide our engineers and workers. It’s essential to recognise that freshly graduated BTech holders possess only theoretical knowledge, lacking industrial experience. This contrasts with practices in foreign countries, where engineering students gain hands-on industrial experience during their studies. To bridge this gap, our education system needs to emphasise on skilling, teaching students what the industry demands.
Are you planning to set up an educational or training institute or tie-up with any foreign universities? A skill university, is that the plan?
Yes, we’re planning to establish a skill university. Our faculty will consist of people with both theoretical and industrial experience, ensuring our students receive comprehensive education. We’re also collaborating with Arizona University. We’re preparing for a future where the concept of labour is redefined, driven by AI, automation, and mechanisation. Our goal is to create a space for better-educated generations, focusing on sustainable practices and technological advancements.
How was ULCCS chosen for the Palarivattom flyover project?
I was directly contacted by E Sreedharan sir. Initially, I declined the offer. But considering his reputation, I agreed to meet him. During our meeting, I expressed concerns about potential controversy, but he reassured me and insisted we take up the project. His trust in our capabilities motivated us to accept the challenge. We maintain a strict no-corruption policy in all our projects.