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Industrial Relations



Industrial Relations

Industrial Relations



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Industrial Relations Industrial Relations Presentation Transcript

  • Industrial Relations Unit IV Jc Lohith Shetty PGDPM, MSW, MBA, UGC-NET Asst Professor St Aloysius College (Autonomous) Trainer – Junior Chamber International President - 2014, JCI Mangalore 1 Lohith Shetty
  • Statutory Instructions: This is not a study material & only a teaching aid. There is constant changes made to this teaching material & those changes are not updated in Slide Share. This slide is prepared as teaching aid only, so it can be understood & interpreted rightly only after attending my classes.     2 Lohith Shetty
  •  Industrial relation means the relationship between employers and employees in course of employment in industrial organisations. However, the concept of Industrial Relations has a broader meaning. In a broad sense, the term Industrial Relations includes the relationship between the various unions, between the state and the unions as well as those between the various employers and the government. Relations of all those associated in an industry may be called Industrial Relations. According to International Labour Organisation, Industrial relations comprise relationships between the state on one hand and the employer’s and employee’s organisation on the other, and the 3 Lohith Shetty relationship among the occupational
  • Definition: According to J.T. Dunlop, “Industrial relations are the complex interrelations among managers, workers and agencies of the government” 1. 2. 3. 4. 5. 4 Importance of Industrial Relations: Uninterrupted Production: Reduction in Industrial disputes: High morale: Reduced wastage: Contributes to economic growth and development. Lohith Shetty
  • Features of Industrial Relations: A. B. C. D. E. F. 5 Industrial relations are outcomes of employment relationships in an industrial enterprise. These relations cannot exist without the two parties namely employers and employees. Industrial relations system creates rules and regulations to maintain harmonious relations. The government intervenes to shape the industrial relations through laws, rules, agreements, terms, charters etc. Several parties are involved in the Industrial relations system. The main parties are employers and their associations, employees and their unions and the government. These three parties interact within economic and social environment to shape the Industrial relations structure. Industrial relations are a dynamic and developing concept, not a static one. They undergo changes with changing structure and scenario of the industry as and when change occurs. Industrial relations include both individual relations and collective relationships. Lohith Shetty
  • Objectives of Industrial Relations: I. II. III. IV. V. VI. VII. VIII. 6 To maintain industrial democracy based on participation of labour in the management and gains of industry. To raise productivity by reducing tendency of high labour turnover and absenteeism. To ensure workers’ participation in management of the company by giving them a fair say in decision-making and framing policies. To establish a proper channel of communication. To increase the morale and discipline of the employees. To safeguard the interests of the labour as well as management by securing the highest level of mutual understanding and goodwill between all sections in an industry. To avoid all forms of industrial conflicts so as to ensure industrial peace by providing better living and working standards for the workers. To bring about government control over such industrial units Lohith Shetty which are running at a loss for protecting the livelihood of the
  • Causes of poor Industrial Relations:  Economic causes:  Organisational  Social causes:  Psychological  Political 7 causes: causes: causes: Lohith Shetty
  • Suggestions to improve Industrial Relations: Sound personnel policies: Participative management: Responsible unions: Employee welfare: Grievance procedure: Constructive attitude: Creating a proper communication channel to avoid grievances and misunderstandings among employees Education and training imparted to the employees         8 Lohith Shetty
  • Grevance Handling „A complaint of one or more workers in respect of  wages, allowances, conditions of work and interpretation of service stipulations covering such areas as overtime, leave, transfer, promotion, seniority, job assignment, and termination of service.‟ Causes as per ILO  Grievance Causes by ILO.docx 9 Lohith Shetty
  • AN ACTUAL GREVANCE HANDLING PROCEDURE  "Prior to any formal grevance, the employee must discuss the issue with his/her immediate supervisor within three (3) working days after the date of occurrence, or three (3) working days after the date which the affected employee(s) could reasonably been made aware of the issue giving rise to the dispute or complaint." "If not resolved by the immediate supervisor within three (3) working days, the employee(s) may submit a formal grievance, in writing, to Step 1 no later than three (3) working days.“ 10 Lohith Shetty
  • AN ACTUAL GREVANCE HANDLING PROCEDURE STEP1:  A written grevance may be submitted by the grievant to the immediate supervisor, as set forth above.  The employee may request a union representative accompany him/her to the discussion, which will be held as soon as practicable, but not more than three (3) working days after the submission of the grievance.  The supervisor shall provide a written answer to the employee within three (3) working days after the meeting.  If the issue is not resolved, the employee(s) and/or 11 Lohith Shetty Union may appeal to Step 2, within three (3) working
  • AN ACTUAL GREVANCE HANDLING PROCEDURE STEP 2:  A meeting between the employee, union representative, the Department head and the supervisor shall be held upon receipt of the appeal, or within three (3) working days thereof.  The Department Head shall provide a written response to the union representative within three (3) working days of the meeting.  If no settlement is reached, to be timely, the union must appeal to Step 3 within five (5) working days. 12 Lohith Shetty
  • AN ACTUAL GREVANCE HANDLING PROCEDURE / STEP 3:     A meeting between the General Manager, Department Head, Human Resource Representative, the District Union Representative, and two (2) other local Union officials (if a discipline case one [1] local union official may be displaced by the grievant) shall be arranged within five (5) working days of receipt of the Union's appeal from Step 2. The meeting date will be established as soon as possible, but no later than twenty (20) working days from the receipt of the appeal, except where circumstances warrant an extension. Such extension shall not extend for more than five (5) working days. The General Manager, or his designate shall render a decision, in writing, to the District Union Representative no later than five (5) working days. If the matter is not resolved, the Union may submit the matter to ARBITRATION within ten (10) working days of receipt of 13 Lohith Shetty Management's STEP 3 answer.
  • ARBITRATION:         Each party shall submit a list of five (5) names to the other. From the Ten (10) names presented, one (1) should be selected as the impartial arbitrator. If no one is acceptable, the union shall submit three (3) names; the company shall submit two (2) names resulting in a list of five (5) names. (In subsequent cases, the arrangement will be reversed.) The party submitting the most names will be the first to eliminate one name, the other party will follow and the sequence will continue until only one name is left. The parties agree that the sole remaining name shall be the arbitrator for this case only. The parties further agree that the decision rendered will be final and binding on all parties, i.e. Management, Union, grievant and employees. Post hearing briefs will not be filed unless requested by the arbitrator, or at the request of either party. The arbitrator’s decision may be oral or written. If written, it shall be delivered to the parties simultaneously not later than thirty (30) 14 Lohith Shetty working days.
  • Disciplinary Actions Meaning  Discipline means obeying the orders of supervisors or orderly behaviour. It is behaviour according to rules, regulations and procedures, which are deemed to be necessary for the effective functioning of an organization. It is a form of employee self-control to meet organization standards. It is willing acceptance of norms of behaviour of the organization. Central core of discipline is self- discipline. Definition  Discipline is defined as “…a force that prompts individuals or groups to observe the rules, regulations 15 Lohith to be and procedures which are deemed Shetty necessary for
  • Objectives of Discipline I. II. III. IV. V. VI. 16 To obtain a willing acceptance of the rules, regulations and procedures of an organization so that organizational goals may be attained ; To impart an element of certainty despite several differences in informal behaviours patterns and other related changes in an organization ; To develop among the employees a spirit of tolerance and a desire to make adjustments ; To give and seek direction and responsibility ; To create an atmosphere of respect for the human personality and human relations; and To increase the working efficiency and morale of the employees so that their productivity is stepped Lohith Shetty up the cost of production improved.
  • PRINCIPLES TO MAINTAIN AND IMPROVE DISCIPLINE IN AN ORGANISATION Prof. Douglas McGregor has suggested the hot-stove rules for maintaining discipline. That is:      Communicating the rules of discipline –as advance warring. Management to specify the rules and penalties clearly and made known to employees and managers which should serve as code of conduct. Immediacy of action. Stove burns immediately if warning is not headed, so management should initiate disciplinary action promptly after the misconduct of the employee. Impartiality or Consistency: Stove burns alike child or old person. No favour / under identifiable situation. If two employees have done same misconduct, the disciplinary action should be consistent in the interest of fairness. Positive approach or constructive discipline or 17 Lohith by self-discipline to be encouraged Shetty the supervisors.
  • Disciplinary Procedure (1) Issuing a letter of charge to the Employee calling upon him for explanation: (2) consideration of the explanation: when the delinquent employee admits, in an unqualified manner, about his misconduct, there is no need for conducting any enquiry further. If not , there is need for serving a show-cause notice. (3) Show-cause Notice: (4) Holding of a full-fledged enquiry : the enquiry should be in conformity with the principles of natural justice, that is, the delinquent employee must be given a reasonable opportunity of being heard. The enquiry officer should record his findings in the process of an enquiry. He may also suggest the nature of disciplinary action to be taken. (5) Considering the enquiry proceedings and findings and Making final order of punishment: (6) Follow-up: After taking disciplinary action, there should be proper 18 Lohith Shetty follow-
  • Intervention by a Tribunal Only under the following circumstances can the tribunal exercise the right to consider the case:  When there is a want of good faith;  When there is victimization or unfair labour practices are used;  When management has been guilty of a basic error or violation of principle of natural justice; and  When the findings are baseless and 19 Lohith Shetty perverse.
  • Types of punishment Oral warnings:  Written warnings:  Loss of privileges and Fines:  Punitive Suspension:  Withholding of increments :  Demotion:  Termination: the employee‟s service terminated in the following forms: (i) discharge simplifiers;, (ii) discharge; (iii) dismissal.  20 Lohith Shetty can be
  • The following are the root causes for indiscipline identified by survey respondents;        Pressures to do whatever it takes to meet business targets (59%) Belief that they will be rewarded for results and not the means (52%) Uncertainty over the rules (51%) Lack of resources to get their job done (50%) Fear of losing their jobs if targets not meant (49%) Policies and procedures are easy to override or ignore (47%) Bend rules for personal gain (32%) 21 Lohith Shetty
  • Disciplinary Actions for Various Offences Type of offence First offence Second offence Third offence Fourth offence Unexcused absence Warning Warning Suspension Discharge Theft Discharge - - - Carelessness Warning Warning Suspension Discharge Warning Discharge - - Insubordination Warning Discharge - - Leaving without permission work Warning Suspension Discharge - Slowdown production on Warning Suspension Discharge - Willful damage to property Discharge -- - - Unexcused excessive lateness Warning Warning Suspension Discharge Sleeping job 22 on the Lohith Shetty
  • Code Of Discipline In Industry Benefits  Secure the settlement of disputes and grievances by a mutually agreed procedure  Avoiding litigations  Facilitate a free growth of trade unions  Eliminate all forms of coercion, intimidation and violations of 23 Lohith Shetty rules and regulations governing industrial
  • The Code is based on the following principles:        There should be no strike or lockout without prior notice. No unilateral action should be taken in connection with any industrial matter. Employees should follow go slow tactics No deliberate damage should be caused to a plant or property Acts of violations, intimidation and coercion should not be resorted The existing machinery for the settlement of disputes should be utilized. Actions that disturb cordial relationships should be avoided. To ensure better discipline in industry, management and unions agree on not indulging into various actions. These actions can b summarized as follows: 24 Lohith Shetty
  • A. Management and Union(s) agree         that no unilateral action should be taken in connection with any industrial matter and that should be settled at appropriate level that the existing machinery for settlement of disputes should be utilized with the utmost efficiency that there should be no strike or lock-out without prior notice that neither party will have recourse to coercion, intimidation, victimization or go –slow tactics that they will avoid litigation, sit-down and stay-in strikes and lock-outs that they will promote constructive co-operation between their representatives at all levels and as between workers themselves that they will establish upon a mutually agreed grievance procedure which will ensure a speedy and full investigation leading to settlement; that they will abide by various stages in the grievance procedure and take no arbitrary action which would by-pass this procedure; and 25 Lohith Shetty
  • B. Management Agrees     not to increase work-loads unless agreed upon or settled otherwise not to support or encourage any unfair labour practice such as discrimination and victimization of any employee to take prompt action for settlement of grievances and implementation of settlements, awards, decision and orders to take appropriate disciplinary action against its officers and members in cases where enquiries reveal that they were responsible for precipitate action by workers leading to indiscipline 26 Lohith Shetty
  • C. Union agrees      not to engage in any form of physical duress not to permit demonstrations which are not peaceful that their members will not engage or cause other employees to engage in any union activity during working hours to discourage unfair labour practices such as negligence of duty, damage to property and insubordination to take prompt action to implement awards, agreements, settlements and decisions 27 Lohith Shetty
  • Workers’ Participation in Management Definition:  According to Keith Davis, Participation refers to the mental and emotional involvement of a person in a group situation which encourages him to contribute to group goals and share the responsibility of achievement.  According to Walpole, Participation in Management gives the worker a sense of importance, pride and accomplishment; it gives him the freedom of opportunity for self-expression; a feeling of belongingness with the place of work and a sense of workmanship and creativity. Lohith Shetty 28
  • The concept of workers’ participation in management encompasses the following: It provides scope for employees in decision-making of the organization.  The participation may be at the shop level, departmental level or at the top level.  The participation includes the willingness to share the responsibility of the organization by the workers.  29 Lohith Shetty
  • Features of WPM: 1. Participation means mental and emotional involvement rather than mere physical presence. 2. Workers participate in management not as individuals but collectively as a group through their representatives. 3. Workers’ participation in management may be formal or informal. In both the cases it is a system of communication and consultation whereby employees express their opinions and contribute to managerial decisions. 4. There can be 5 levels of Management Participation or WPM: 30 Lohith Shetty
  • There can be 5 levels of Management Participation or WPM: a. Information participation: It ensures that employees are able to receive information and express their views pertaining to the matter of general economic importance. b. Consultative importance: Here workers are consulted on the matters of employee welfare such as work, safety and health. However, final decision always rests with the top-level management, as employees‟ views are only advisory in nature. c. Associative participation: It is an extension of consultative participation as management here is under the moral obligation to accept and implement the unanimous decisions of the employees. Under this method the 31 Lohith Shetty
  • There can be 5 levels of Management Participation or WPM: Contd... d. Administrative participation: It ensures greater share of workers‟ participation in discharge of managerial functions. Here, decisions already taken by the management come to employees, preferably with alternatives for administration and employees have to select the best from those for implementation. e. Decisive participation: Highest level of participation where decisions are jointly taken on the matters relating to production, welfare etc. 32 Lohith Shetty
  • Objectives of WPM: 1. To establish Industrial Democracy. 2. To build the most dynamic Human Resources. 3. To satisfy the workers’ social and esteem needs. 4. To strengthen labour-management cooperation and thus maintain Industrial peace and harmony. 5. To promote increased productivity for the advantage of the organization, workers and the society at large. 6. Its psychological objective is to secure full recognition of the workers. 33 Lohith Shetty
  • Strategies / Methods / Schemes / Forms of WPM: 1. Suggestion schemes: 2. Works committee: 3. Joint Management Councils: These councils were setup as early as 1958. These councils consist of equal number of representatives of the employers and employees, not exceeding 12 at the plant level. The plant should employ at least 500 workers. 4. Work directors: 5. Co-partnership: 6. Joint Councils: in every Industrial Unit employing 500 or more workers, 7. Shop councils: : in every Industrial Unit employing 500 or more workers, 34 Lohith Shetty
  • Reasons for failure of Workers participation Movement in India: 1. Employers resist the participation of workers in decision-making. 2. Workers’ representatives who participate in management have to perform the dual roles of workers’ spokesman and a co-manager. 3. Generally Trade Unions’ leaders who represent workers are also active members of various political parties. 4. Schemes of workers’ participation have been initiated and sponsored by the Government. However, there has been a lack of interest and initiative on the part of both the trade unions and employers. 35 Lohith Shetty
  • Reasons for failure of Workers participation Movement in India: Contd... 5. In India, labour laws regulate virtually all terms and conditions of employment at the workplace. Workers do not feel the urge to participate in management, having an innate feeling that they are born to serve and not to rule. 6. The focus has always been on participation at the higher levels, lower levels have never been allowed to participate much in the decision-making in the organizations. 7. The unwillingness of the employer to share powers with the workers’ representatives, the disinterest of the workers and the perfunctory attitude of the government towards participation in 36 Lohith Shetty management
  • Measures for making Participation effective: 1. 2. Employer should adopt a progressive outlook. Employers and workers should agree on the objectives of the industry. 3. Workers and their representatives should be provided education and training in the philosophy and process of participative management. 4. There should be effective communication between workers and management and effective consultation of workers by the management in decisions that have an impact on them. 5. Participation should be a continuous process. To begin with, participation should start at the operating level of management. 6. A mutual co-operation and commitment to participation must be developed by both management and labour. 37 Lohith Shetty
  • Functions Of Trade Unions Functions Of Trade Unions A. Militant Functions  To achieve higher wages and better working conditions  To raise the status of workers as a part of industry  To protect labours against victimization and injustice B. Fraternal Functions  To generate self confidence among workers  To encourage sincerity and discipline among workers  To provide opportunities for promotion and growth  To protect women workers against discrimination  38 Lohith Shetty
  • Development of trade unionism in India The first phase (1850 to1900) During this phase the inception of trade unions took place. During this period, the working and living conditions of the labour were poor and their working hours were long... In order to regulate the working hours and other service conditions of the Indian textile labourers, the Indian Factories Act was enacted in 1881 The growth of trade union movement was slow in this phase and later on the Indian Factory Act of 1881 was amended in 1891. Many strikes took place in the two decades following 1880 in all industrial cities. Small associations like Bombay Mill-Hands Association came up by this time. 39 Lohith Shetty
  • The second phase (1900 to 1946)      ...development of organized trade unions and political movements of the working class. Between 1918 and 1923, many unions came into existence in the country. At Ahmedabad, under the guidance of Mahatma Gandhi, occupational unions like spinners‟ unions and weavers‟ unions were formed. These unions federated into industrial union known as Textile Labor Association in 1920. In 1920, the First National Trade union organization (The All India Trade Union Congress (AITUC)) was established. 40 Lohith Shetty
  • The third phase : since Independence By 1949, four central trade union organizations were functioning in the country: a) The All India Trade Union Congress, b) The Indian National Trade Union Congress, c) The Hindu Mazdoor Sangh, and d) The United Trade Union Congress  Besides workers, white-collar employees, supervisors and managers are also organized by the trade unions, as for example in the Banking, Insurance and Petroleum industries.  Political parties started taking major role in Trade Unions for personal advantages also  41 Lohith Shetty
  • Facts:The rural workers, who constitute about 60 per cent of the workforce. Organized sector, which employs 8 per cent of workforce, and The urban informal sector (which includes the growing software industry and other services, not included in the formal sector) which constitutes the rest 32 per cent of the workforce. At present there are twelve Central Trade Union Organizations in India:  All India Trade Union Congress (AITUC)  Bharatiya Mazdoor Sangh (BMS)  Centre of Indian Trade Unions (CITU)  Hind Mazdoor Kisan Panchayat (HMKP)  Hind Mazdoor Sabha (HMS)  Indian Federation of Free Trade Unions (IFFTU)  Indian National Trade Union Congress (INTUC)  National Front of Indian Trade Unions (NFITU)  National Labor Organization (NLO)  Trade Unions Co-ordination Centre (TUCC)  United Trade Union Congress (UTUC) and  United Trade Union Congress - LeninLohith Shetty(UTUC - LS) Sarani 42
  • COLLECTIVE BARGAINING  N.F. Dufty has defined “ Collective bargaining to include negotiations between management and trade unions on jointly determined issues”.  Richardson “ Collective bargaining takes place when a number of work people enter into a negotiation as a bargaining unit with an employer or group of employers with the object of reaching an agreement on the conditions of employment of the work people”. 43 Lohith Shetty
  • Main Features of Collective Bargaining 1. It is a group Action : 2. It is a continuous process: 3. It is a Bipartite Process : 4. It is flexible and mobile and not fixed or static: 5. It is industrial Democracy at work: 6. It is Dynamic : 7. It is a complementary and not a competitive Process:8. It is an art : 44 Lohith Shetty
  • Need of collective Bargaining A. For the Union: Group is strength. Union gets recognition.  Easier to approach the management  Union is representative- the decision, agreement are accepted by all group members.  Needs can be properly organized n put forth to the management  Many ideas can be pulled together.  These deliberate have legal as well as moral standings.  Credit to the union if the demands is met.  An opportunity to the employees to participate in the 45 Lohith Shetty management proceedings 
  • B. For the Management: can speak to the employee’s representative – need not meet each employees.  Since it is an employees group decision are to be accepted by all employees for an agreed period of time hence saves a lot of time by not having to attend to petty issues every day.  They can make the employees realize the management position / plight of the status of the industry.  Employees trust & accept these friend s better hence the management need not to take the tension of getting support of individuals.  The management will be able to push through the expectations/ expansions plans of the management through the group of employees. Shetty 46 Lohith  They
  • C. For the government Maintains harmonious relation between management and trade union. Prerequisites for a harmonious Collective Bargaining  Know what you want (union)  Know what you can ask for(union)  Know what you should ask for(union)  Know how to ask(union)  Know why you should ask(union)  Know what you can give (management)  Know how much you can give (management)  Know how you can give (management)  Be open, honest, transparent, (both)  Have an atmosphere & attitude which is of trust, non biased, non-judgmental attitude (both) 47 Lohith Shetty  Be committed for your commitments (both)
  • Process of collective bargaining 1. 2. 3. 4. 5. The union often and series of discussion takes between them & list out their demands. Prepares a list of demands which is called as CHARTER OF DEMANDS with due signature of the representative. Next step is to submission of charter of demands towards to the management. The management receives and studies it. In return management gives their demands called as COUNTER DEMANDS what they are expecting in return from employees. 48 Lohith Shetty
  • Process of collective bargaining Contd... 6. Both the parties will be having each others expectations. 7. Particular time, venue, will be fixed to have discussion, deliberate on an issue. 8. Each point t will be taken up to come the agreement through the discussion. 9. Some issues listed out and some are dropped out if both parties agree. 10. There after an agreement is drafted out mentioning agreed issues. 11. This is called as MEMORANDUM OF AGREEMENT. 49 Lohith Shetty
  • CHARTER OF DEMANDS           Food Entitlements Health, Water and Sanitation Education Increments Changes in Working hours Changes in disciplinary actions Ergonomic work stations Additional welfare facilities Additional safety facilities Changes in new/ existing policy 50 Lohith Shetty
  • Hindrances of collective Bargaining Failure of some employers to accept trade unions as a permanent feature of the national economy.  Separatist tendencies of the craft trade unions.  Non- availability of factual information.  Unfair practices.  Unequal strengths of the parties.  Poor Leadership Factors Which Influence the Decision –making process in Collective bargaining  Economic factors  Psychological factors  Power structure  51 Lohith Shetty
  • Factors responsible for the growth WhiteCollar Workers’ Unions? 1. Denial of Job Security and Social Security & their exclusion from the purview of labour laws like; Industrial Disputes Act, 1947, etc 2. Anomalies in pay caused ....recommendations of Wage Boards and Pay Commissions. 3. Nationalisation and consequent rationalisation of pay and perquisites. 4. Unions, white-collar workers unions are registered either under the Trade Unions Act, 1926, or under the Societies Registration Act, 1860, 5. Due to higher education knowledgeable and intelligent, ...union leadership is mostly internal or endogenous. 6. Financially and membership-wise they are stronger 52 Lohith Shetty
  • Factors responsible for the growth WhiteCollar Workers’ Unions? Contd.... 7. White-collar unions suffer much less from multiplicity, politicalisation and outside leadership, and consequently from inter-union rivalries than the bluecollar unions 8. job security: which their unions may have to look after. ... as their members are not much supported by the I.D. Act, 1947. 9. Inconsistent and discriminatory promotion and salary policies... 10. Gradual narrowing of wages and salaries differentials of blue and white-collar workers .... and so causing feeling of deprivation among white-collar workers. Lohith Shetty 11. 53 Inflation and soaring prices resulting in erosion of pay
  • Doubts/ Clarifications 54 Lohith Shetty