New conflict and settlement of disputes session


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New conflict and settlement of disputes session

  1. 1. Industrial Conflict and Settlement of Disputes An overview
  2. 2. Causes of poor Industrial Relations <ul><li>Mental inertia on the part of management and labour </li></ul><ul><li>Inadequate welfare facilities </li></ul><ul><li>Unhealthy working conditions </li></ul><ul><li>Indiscipline </li></ul><ul><li>Lack of proper human relations skills on the part of supervisors and other managers </li></ul><ul><li>Desire on the part of workers for higher bonus </li></ul><ul><li>Inappropriate introduction of automation without providing right climate </li></ul><ul><li>Unduly heavy workloads </li></ul><ul><li>Unfair labour practices, like victimization and undue dismissal </li></ul><ul><li>Retrenchment dismissals and lockouts on the part of management and strikes on the part of workers </li></ul><ul><li>General political and economic environment such as rising prices, strikes by others and general indiscipline </li></ul>September 11, 2011
  3. 3. Establishing a Sound Industrial Relations System <ul><li>Recognition by the employer that the workers are a part of a team working towards common objective </li></ul><ul><li>Fair redressal of employee’s grievances with regard to working conditions, facilities, attitudes of supervisors and other rights </li></ul><ul><li>Payment of fair wages and adequate wage structures as well as establishment of satisfactory working conditions </li></ul><ul><li>Adoption of a policy which ensures to the workers an equitable share of the gains of increased productivity </li></ul><ul><li>Introduction of a suitable system of employees education at all levels as well as providing them with appropriate equipment where necessary </li></ul>September 11, 2011
  4. 4. <ul><li>Training in IR and HR to workers, technical staff and at all managerial levels </li></ul><ul><li>Sufficient communication to keep the employees informed about decisions which affect their interests </li></ul><ul><li>Establishment of an atmosphere of participation whether through joint committees or other methods. </li></ul><ul><li>Management should have harmony as a goal. </li></ul><ul><li>Uniform applicability of the policy and procedures for all </li></ul><ul><li>Maintain direct two way communication between management and employees </li></ul><ul><li>Need to maintain a systematic data base on all aspects of HRM to ensure objectivity in managerial actions </li></ul>September 11, 2011
  5. 5. Industrial Conflict/Disputes <ul><li>Industrial conflict is a general concept..when it acquires specific dimensions, it becomes an industrial dispute. </li></ul><ul><li>Acc to Industrial disputes Act 1947, “Industrial disputes mean any dispute or difference between employers and employers, or between employers and workmen or between workmen and workmen, which is connected with the employment or non-employment or terms of employment or with the conditions of labour of any person” </li></ul>September 11, 2011
  6. 6. Classification of Industrial disputes <ul><li>Interest disputes/Economic Disputes : They relate to the determination of new terms and conditions of employment for general body of workers. Disputes originate from trade union demands or proposals for improvements in wages, fringe benefits, job security or other terms and conditions of employment. </li></ul><ul><li>For settlement of interest disputes recourse must be made to bargaining power, compromise etc. </li></ul>September 11, 2011
  7. 7. <ul><li>Grievance disputes/Rights Disputes: They involve individual workers only or a group of workers …who protest against an act of management that is considered to violate their rights. The grievance arise basically on such questions as discipline and dismissal, the payment of wages and other fringe benefits, working time, overtime, promotions, demotion, transfer rights of seniority, job classification problems etc. Grievances might arise over the interpretation and application of collective agreements and in that case they are called interpretation disputes. </li></ul><ul><li>For settlement of Grievance disputes the relevant provisions, contracts, work rules and laws or customs are referred to. </li></ul>September 11, 2011
  8. 8. <ul><li>Unfair labour practices: The most common unfair labour practices in industrial relations are attempts by the management of an undertaking to discriminate against workers. Other unfair practices might concern with interference, restraint or coercion of employees for any reason. </li></ul><ul><li>The Industrial Disputes Act 1947 is more specific about the unfair labour practices . Following constitute unfair labour practices: </li></ul><ul><li>1. To interfere with, restrain from or coerce workmen in the exercise of their right to organize, form, join or assist a trade union or to engage in concerted activities for the purposes of collective bargaining or other mutual aid or protection i.e. </li></ul><ul><li>Threatening workmen with discharge or dismissal if they join a trade union </li></ul><ul><li>Threatening a lockout or closure if TU is organized </li></ul><ul><li>Granting wage increases to workmen at crucial periods of the TU organization with a view to undermine the efforts of the TU at organization </li></ul>September 11, 2011
  9. 9. <ul><li>2. To dominate, interfere with or contribute support, financial or otherwise, to any trade union, i.e. </li></ul><ul><li>An employer taking an active interest in organizing a TU of his or her workmen </li></ul><ul><li>An employer showing partiality or granting favour to one of several trade unions attempting to organize his or her workmen </li></ul><ul><li>3. To establish employer-sponsored TUs of workmen </li></ul><ul><li>4. To encourage or discourage membership in any TU by discriminating against any workman </li></ul><ul><li>5. To discharge or dismiss workmen </li></ul><ul><li>By way of victimization </li></ul><ul><li>Not in good faith but in the arbitrary exercise of the employer’s rights </li></ul><ul><li>By falsely implicating a workman in a criminal case on false evidence </li></ul><ul><li>6. To abolish work of regular nature being done by workmen and to give such work to contractors </li></ul>September 11, 2011
  10. 10. <ul><li>7. To transfer a workman malafide from one place to another under the guise of following management policy </li></ul><ul><li>8. To insist upon individual workmen, who are on legal strike, to sign a good conduct bond as a precondition to allowing them to resume work 9. To show favouritism or partiality to one set of workers regardless of merit </li></ul><ul><li>10. To employ workman as ‘badlis’, casuals or temporaries and to continue them as such for years </li></ul><ul><li>11.To discharge or discriminate against any workman for filing charges or testifying against an employer in any enquiry or proceeding </li></ul><ul><li>12. To recruit workmen during a strike which is not an illegal strike </li></ul>September 11, 2011
  11. 11. <ul><li>13.Failure to implement award, settlement or agreement </li></ul><ul><li>14. To indulge in acts of force or violence </li></ul><ul><li>15. To refuse to bargain collectively, in good faith with the recognized TUs </li></ul><ul><li>16. Proposing or continuing a lockout deemed to be illegal under this Act </li></ul><ul><li>Recognition disputes/Recognition disputes: This type of dispute arises when the management of an undertaking or employer’s organization refuses to recognize a trade union or the purpose of collective bargaining . </li></ul>September 11, 2011
  12. 12. Impact of Industrial Disputes <ul><li>The Economy/Nation/Public/Society: </li></ul><ul><li>They disturb the economic, social and political life of a country </li></ul><ul><li>Industrial disputes may assume national proportions affecting the entire community </li></ul><ul><li>Result in a huge wastage of man days and dislocation in the production work </li></ul><ul><li>A strike in a public utility service like water supply, power and gas supply units, postal, telegraph or telephone services, railways, roadways etc disorganizes public life and throws the economy out of gear </li></ul><ul><li>The Workers : </li></ul><ul><li>The workers are also affected as they lose the wages for the strike period. </li></ul><ul><li>Sometimes workers lose their employment, are prosecuted, given severe beating and are repressed by the police. </li></ul><ul><li>Unsuccessful strikes, besides inflicting financial loss on workers, demoralize them, make them disappointed and shake their confidence in trade unions. </li></ul>September 11, 2011
  13. 13. <ul><li>The Employers : </li></ul><ul><li>They suffer heavy losses due to stoppages of production, reduction of sales and loss of markets </li></ul><ul><li>They have to incur huge expenditure on crushing strikes, engaging strike breakers and blacklegs maintaining a police force and guards, organizing counter demonstrations, processions and meetings. </li></ul><ul><li>They need to protect plant and machinery and spend a lot to undertake publicity and espionage. </li></ul><ul><li>Loss of mental peace, respect and status in the society, goodwill in the market cannot be commuted in terms of money. </li></ul>September 11, 2011
  14. 14. Vicious circle of unhealthy Industrial Relations Loss in productivity Misutilization of Capital investment Non-Fulfillment of Targeted Growth September 11, 2011
  15. 15. Causes of Industrial Conflicts <ul><li>Industry related factors : </li></ul><ul><li>Dismissal or non-employment of any person </li></ul><ul><li>Registered agreement, settlement or award </li></ul><ul><li>Demarcation of the functions of an employee </li></ul><ul><li>Management related factors: </li></ul><ul><li>Management generally not willing to talk over any dispute with the employees or their representatives </li></ul><ul><li>The management’s unwillingness to recognize a particular trade union </li></ul><ul><li>Even when trade unions are recognized to some extent the employers hesitate to delegate enough authority which could enable them to negotiate properly </li></ul><ul><li>The lack of worker’s participation in various aspects like recruitment, promotion, transfers, merit awards etc. </li></ul>September 11, 2011
  16. 16. <ul><li>Government related factors: </li></ul><ul><li>The changes in economic policies </li></ul><ul><li>Ineffective and unsatisfactory working of various laws and enactments due to the reason that : </li></ul><ul><li>Most of the labour laws have lost their relevance in the context of changed industrial climate </li></ul><ul><li>Improper and inadequate implementation of labour laws by most of the employers </li></ul><ul><li>Inherent difficulties in monitoring the working of various labour laws </li></ul><ul><li>Trade Union factors: </li></ul><ul><li>Trade union movement highly influenced by politics </li></ul><ul><li>Tense Inter-union rivalry among less important and dominant trade unions invariably sparks off disputes </li></ul>September 11, 2011
  17. 17. Causes of Industrial Conflict September 11, 2011 Economic Causes Wages Bonus Overtime Payment Political Causes Political instability Affiliation of political parties with unions Social Causes Low morale in society Social values and norms Rich vs Poor disparity Class divisions Technological Causes Unsuitable technology Difficulty in technology adoption Resistance to change Fear of unemployment Psychological Causes Conflict in individual and organizational objectives Motivational problems Personality clashes Attitudinal problems Market Situation Rising prices Shortage in supply Legal Causes Inadequacy of legal machinery Causes of Industrial Disputes/Conflict
  18. 18. Manifestations of conflict <ul><li>Manifestation of Organized Group Conflict </li></ul><ul><li>Manifestation of individual and Unorganized Conflict </li></ul>Source: Kornhauser,A,Dubin and Ross, A.M., “Industrial Conflict”, McGraw Hill, 1954, p.14 September 11, 2011 <ul><li>Manifestations of Unions </li></ul><ul><li>Non-Cooperation to negotiate </li></ul><ul><li>Arguments </li></ul><ul><li>Hostility </li></ul><ul><li>Stresses and tension </li></ul><ul><li>Unwillingness to negotiate </li></ul><ul><li>Resentment </li></ul><ul><li>Absenteeism </li></ul><ul><li>Work-to-rule </li></ul><ul><li>Demonstration, Morcha, Gherao </li></ul><ul><li>Loss of Production </li></ul><ul><li>Strike </li></ul><ul><li>Manifestations of Management </li></ul><ul><li>Unwillingness withholding </li></ul><ul><li>Termination </li></ul><ul><li>Demotion </li></ul><ul><li>Lay-offs </li></ul><ul><li>Lockouts </li></ul><ul><li>Workers </li></ul><ul><li>Unorganized supervision of efforts </li></ul><ul><li>Intentional waste and inefficiency </li></ul><ul><li>Labour Turnover </li></ul><ul><li>Absenteeism complaints </li></ul><ul><li>Instances of breaking of rules </li></ul><ul><li>Strike </li></ul><ul><li>Management </li></ul><ul><li>Autocratic </li></ul><ul><li>Over-strict discipline </li></ul><ul><li>Unnecessary firing </li></ul><ul><li>Demotion </li></ul><ul><li>Lay-offs </li></ul><ul><li>Lockout </li></ul>
  19. 19. Strikes <ul><li>Section 2(q) of ID Act 1947 defines a strike as, “a cessation of work by a body of persons employed in any industry acting in combination, or a concerted refusal under a common understanding of a number of persons who are or have been so employed to continue to work or to accept employment” </li></ul><ul><li>In this light strike postulates three main elements: </li></ul><ul><li>Plurality of workmen </li></ul><ul><li>Cessation of work or refusal to do work </li></ul><ul><li>Combined or concerted action </li></ul>September 11, 2011
  20. 20. Typology of strikes Strikes Primary Strike Secondary Strike Others <ul><li>Stay –Away strike </li></ul><ul><li>Sit-down stay-in strike </li></ul><ul><li>Tool-down/Pen-down strike </li></ul><ul><li>Go slow </li></ul><ul><li>Work to rule </li></ul><ul><li>Token or Protest strikes </li></ul><ul><li>Lightening or Cat-call strike </li></ul><ul><li>Picketing and Boycott </li></ul><ul><li>Gherao </li></ul>Sympathy Strikes <ul><li>General </li></ul><ul><li>Particular </li></ul><ul><li>Political </li></ul><ul><li>Bandhs </li></ul>September 11, 2011
  21. 21. <ul><li>Primary strike: In it the workers refuse to work for their employers with whom they have a conflict…it includes pen down strike, stay in strike, tool down strike etc. </li></ul><ul><li>Go slow: This is the kind of unrest which does not stop work altogether, but here the speed of the work being done is reduced…a serious form of misconduct rather than a strike </li></ul><ul><li>Wild cat Strike: This is a strike conducted by a small group of workers for a short time, but it does not have the backing of a union to support it </li></ul>September 11, 2011
  22. 22. <ul><li>General strike: It is also called a Bandh in India…a simultaneous strike by members of trade union over a wide area </li></ul><ul><li>Sympathetic Strike: It is usually a day’s strike or a token strike, not for the fulfillment of any of their own demands, of a trade union, but to demonstrate their support for a strike in another organization </li></ul>September 11, 2011
  23. 23. Right to Strike: When are strikes justified? <ul><li>The strike must be appropriate for attaining legitimate goals, consistent with subsequent industrial peace </li></ul><ul><li>The strike must take into account economic possibilities, keeping the public interest in view </li></ul><ul><li>The strike must be necessary in the light of facts and should be used as the last resort-after exhausting all other possibilities and procedures </li></ul><ul><li>The strike must be a fair right. It must not have the aim of destroying the opponent. </li></ul><ul><li>More specifically: </li></ul><ul><li>It should be launched only for economic demands, such as basic pay, DA, increment, leave and other fringe benefits which are the primary objectives of a Trade union </li></ul><ul><li>The demands of workmen should be reasonable and legitimate so that there is a prima facie justification for the demands…The demands should not be raised frivolously or for ulterior reasons </li></ul><ul><li>When existing facilities are summarily withdrawn or Provident fund is closed , a strike would be justified </li></ul><ul><li>If there is any unfair labour practice on the part of management a strike is justified </li></ul><ul><li>When there is no response from the management in spite of referring a demand and issuing a reminder, a strike is justified </li></ul>September 11, 2011
  24. 24. Prevention of strikes <ul><li>If an optimal level of good industrial relation is to be developed and maintained , the incidence and frequency of strikes should be minimized through persistent efforts by the management: </li></ul><ul><li>The management should adopt well-defined, precise, clear and progressive HRM policies for the maintenance of good industrial relations </li></ul><ul><li>It should ensure an effective administration and timely implementation of these policies </li></ul><ul><li>It should ensure that an effective two-way communication system is in operation. </li></ul><ul><li>It should provide just and humane conditions of work, along with suitable welfare activities for the benefits of workers and develop close personal contacts with the employees at all levels </li></ul><ul><li>It should evolve and adopt a suitable and speedy grievance redressal procedure for the management of worker’s problems </li></ul><ul><li>IT should give recognition to a representative union and should have a pragmatic approach to union activities </li></ul><ul><li>It should ensure joint consultation at different levels and encourage collective bargaining </li></ul>September 11, 2011
  25. 25. Lockouts <ul><li>“ Lockout” refers to the action of an employer in temporarily closing down or shutting down the undertaking or refusing to provide its employees with work with the intention of forcing them either to accept the demands made by them or withdraw the demands made by them on him. </li></ul><ul><li>According to ID Act, “lockout means the closing of a place of business or employment or the suspension of work or the refusal by an employer to continue to employ any number of persons employed by him” </li></ul>September 11, 2011
  26. 26. Justice Gajendra Gadkar in Khairabeeta estate Vs Rajamanikam (1961) quotes on Lockout <ul><li>“ Lockout can be described as the antithesis of a strike. Just as strike is a weapon available to the employees for enforcing their individual demands. A lockout is a weapon available to the employers to persuade by coercive process, the employees to see his point of view and accept his demands” </li></ul>September 11, 2011
  27. 27. <ul><li>Lockout is a closure of industrial undertaking because of the existence of or apprehension of an industrial dispute, violence and damage to property </li></ul><ul><li>It is the suspension of employment in so far as the employer refuses to give work to the workmen until they yield to his demand or withdraw the demands made on him </li></ul><ul><li>A lockout is a antithesis of a strike </li></ul><ul><li>A lockout is used with some intention i.e. to coerce or force workmen to come to terms </li></ul>September 11, 2011
  28. 28. What is not a lockout? <ul><li>Prohibiting an individual employee </li></ul><ul><li>Termination of employment by retrenchment </li></ul><ul><li>Termination of services of more than one person at the same time </li></ul><ul><li>Declaration of a lockout by an employer merely on ground that the workmen have refrained from attending to work </li></ul>September 11, 2011
  29. 29. Machinery for settlement of Industrial disputes Need for a Progressive Approach
  30. 30. <ul><li>Preventive and Ethical Approach: (Non Statutory) </li></ul><ul><li>Works Committees </li></ul><ul><li>Code of Discipline </li></ul><ul><li>Positive Discipline </li></ul><ul><li>Management of Grievances </li></ul><ul><li>Legal /Curative Approach : ( Statutory) </li></ul><ul><li>Conciliation </li></ul><ul><li>Voluntary Arbitration </li></ul><ul><li>Adjudication </li></ul>
  31. 31. Preventive Vs Curative Approach <ul><li>Preventive approach : what can be done prior to occurrence of industrial disputes to reduce their intensity, frequency and duration or altogether eliminate them </li></ul><ul><li>Curative Approach : what must be done after industrial disputes arise in order to resolve them at the earliest </li></ul><ul><li>These two approaches are also called proactive and reactive approaches respectively </li></ul>
  32. 32. Conflict Resolution/Settlement of Disputes September 11, 2011 Collective Bargaining Works committee Discipline/ Grievance Process Arbitration Conciliation Adjudication Workers Participation ID Act 1947 State Acts Non-Statutory Methods Government Machinery Statutory Measures
  33. 33. Conciliation Arbitration and Adjudication <ul><li>According to ILO conciliation can be defined as “the practice by which the services of neutral third party are used in a dispute as a means of helping the disputing parties to reduce the extent of their differences and to arrive at an amicable settlement or agreed solution” </li></ul><ul><li>According to the industrial disputes Act 1947, the conciliation machinery in India consists of </li></ul><ul><li>Conciliation Officer </li></ul><ul><li>Board of conciliation </li></ul><ul><li>Court of Enquiry </li></ul>
  34. 34. <ul><li>Adjudication involves, “compulsory attendance of witness, compulsory powers of investigation and compulsory enforcement of awards with penalties for breaches of these awards…thus adjudication embraces intervention in the dispute by a third party appointed by the government” </li></ul><ul><li>The three tier Machinery for the adjudication of industrial disputes as provided by industrial disputes Act 1947 consists of </li></ul><ul><li>Labour Court </li></ul><ul><li>Industrial Tribunal </li></ul><ul><li>National Tribunal </li></ul>
  35. 35. <ul><li>Arbitration is a , “voluntary method of resolving industrial disputes…It is resorted to before the dispute is referred to a labour court, industrial tribunal or national tribunal…” </li></ul><ul><li>Arbitration is different from Conciliation in the following aspects : </li></ul><ul><li>Its decision is binding on the parties </li></ul><ul><li>The arbitrator gives his judgement on the basis of the evidence submitted to him by employers and the employees (unions) </li></ul><ul><li>Arbitration is different from Adjudication in following aspects: </li></ul>
  36. 36. Difference between Arbitration and Adjudication <ul><li>Arbitration </li></ul><ul><li>Voluntary method of resolving industrial disputes </li></ul><ul><li>The power to refer an industrial dispute to an arbitrator is derived from the written agreement made by the employers and the workmen together and it is these two parties together who agree to refer a dispute to arbitration </li></ul><ul><li>Arbitrators are specified in the written agreement </li></ul><ul><li>Adjudication </li></ul><ul><li>It is compulsory and is the ultimate remedy for resolving industrial disputes provided by the ID Act, 1947 </li></ul><ul><li>The power to adjudicate upon dispute is statutory and is derived from the provisions of ID Act, 1947 </li></ul><ul><li>The presiding officers of adjudication bodies are appointed by the appropriate government only and all these consist of one person only </li></ul>
  37. 37. Work Committees <ul><li>Section 3 of the Industrial Disputes Act, 1947 provides for the setting up of a works committee in all industrial establishments employing one hundred or more workers consisting of representative of management and employees….It is the duty of the employer to form such a committee </li></ul>
  38. 38. Composition <ul><li>This committee is bipartite with a provision that the number of representative of workmen shall not be less than the number of representatives of employer but the total number shall not exceed 20 </li></ul><ul><li>The representatives of employer shall be a nomination and the worker’s representatives shall be elected from among workmen. </li></ul><ul><li>The committee shall have a chairman to be nominated by the employer, a vice-chairman to be elected by workers, a secretary and joint secretary to be elected by the committee. </li></ul>
  39. 39. <ul><li>The term of office bearers shall be six years, one-third retiring every two years </li></ul><ul><li>Workers with one year of continuous service are eligible to stand for election. workers with six months of continuous service are eligible to vote. </li></ul>
  40. 40. Objectives <ul><li>According to the Industrial Disputes Act, the objectives of the works committee are to , “ promote measures for securing and preserving amity and good relations between the employer and the workmen , and to that end, to comment upon matters of their common interest or concern and endeavour to compose any material difference of opinion in respect of such matters ”…….”Industrial peace will be most enduring where it is founded on voluntary settlement and it is hoped that the works committee will render recourse to the remaining machinery provided for the settlement of industrial disputes” </li></ul>
  41. 41. Functions of Works Committees <ul><li>As enumerated in the 17 th session of Indian Labour Conference 1959: </li></ul><ul><li>Conditions of work such as ventilation, lighting, temperature and sanitation </li></ul><ul><li>Amenities such as drinking water, canteens, rest rooms, medical and health services </li></ul><ul><li>Safety and accident prevention, occupational diseases and protective equipment </li></ul><ul><li>Adjustment of festivals and national holidays </li></ul><ul><li>Administration of welfare and fine funds </li></ul><ul><li>Educational and recreational activities </li></ul><ul><li>Implementation and review of decisions arrived at in the meetings of works committees </li></ul>
  42. 42. <ul><li>The works committee would not discuss (or deal with) the following: </li></ul><ul><li>Wages and allowances </li></ul><ul><li>Bonus and profit sharing bonus </li></ul><ul><li>Fixation of work load </li></ul><ul><li>Retrenchment and lay-off </li></ul><ul><li>Victimization of trade union activities </li></ul><ul><li>Leave and holidays </li></ul><ul><li>Incentive schemes </li></ul><ul><li>Housing and transport </li></ul><ul><li>P.F, gratuity and other retirement benefits </li></ul><ul><li>Collective bargaining </li></ul>
  43. 43. Failure of Works Committee <ul><li>According to the National Commission of Labour (1969), the advisory nature of the recommendations, vagueness regarding their exact scope, the functions, inter-union rivalries, union opposition and reluctance of employers in this regard. </li></ul>
  44. 44. Collective Bargaining: ILO’s Perspective <ul><li>In a bulletin issued by the ILO in 1960, collective bargaining has been defined as, “ negotiations about working conditions and terms of employment between an employer, a group of employers or one or more employer organizations and one or more representative worker’s organizations ….with a view to reaching agreement wherein the terms of an agreement serve as a code defining the rights and obligations of each party in their employment relations with one another; it fixes a large number of detailed conditions of employment , and during its validity none of the matters it deals with can in normal circumstances give grounds for dispute concerning an individual worker” </li></ul>September 11, 2011
  45. 45. Collective bargaining is : <ul><li>A process of Accommodation : Acc to Harbinson collective bargaining “is a process of accommodation between two institutions which have both common and conflicting interests”……It purports not to attain industrial peace , rather it aims at the attainment of the commonly held goals of a free society..specifically the major function of collective bargaining is to generate pressures for enhancement of the dignity and worth of concerned parties. </li></ul><ul><li>Performing mutual obligations: Collective bargaining finds a place in the National Labour Relation Act of United States. The Act in section 8(d) defines collective bargaining as, “the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable time and confer in good faith with respect to wages, hours and other terms and conditions of employment, or the negotiation of an agreement, or any question arising there under, and the execution of a written contract corroborating any agreement reached if requested by either party” </li></ul><ul><li>A two-way street : It protects the basic interests of the management as well as the legitimate rights of the workers. </li></ul>September 11, 2011
  46. 46. Basic Characteristics of Collective Bargaining <ul><li>A political institution in which rules are made by trade unions of workers, employers and corporations/ organizations </li></ul><ul><li>A negotiation, administration and interpretation of written agreement between the union and management which covers a specific period of time. </li></ul><ul><li>It is opposed to individual bargaining as it related to group bargaining about wages and salaries and working conditions </li></ul><ul><li>The extension of the democratic idea into work organization </li></ul><ul><li>It is a continuous and dynamic activity in the employer and employee relationships </li></ul><ul><li>It is not a competitive process rather is a complementary process </li></ul>September 11, 2011
  47. 47. Collective bargaining: A Model <ul><li>N.W. Chamberlain developed a model of collective bargaining. He defines “ Bargaining power as the ability of a party to bargain to secure the agreement of the other party to its own terms. Thus the bargaining power of a trade union will refer to the willingness of the management to agree to union’s demands , while management’s bargaining power can be defined a union’s willingness to agree to management’s terms” </li></ul><ul><li>UBP= MCD/MCA If UBP<1, management choose to disagree and reject union’s terms </li></ul><ul><li>MBP=UCD/UCA If MBP<1, union will choose to reject management’s offer </li></ul>September 11, 2011
  48. 48. Cost of Agreeing and Disagreeing <ul><li>Management’s cost of disagreeing is the estimated loss of profits during the strike which may follow its rejection of union’s wage demand </li></ul><ul><li>Management’s perceived cost of agreeing is the estimated reduction in profits resulting from payment of higher wages as demanded by unions </li></ul><ul><li>Union’s cost of disagreeing is the estimated loss of wage income during a strike or lockout </li></ul><ul><li>Union’s cost of agreeing to a lower wage than the one demanded by union is the reduced flow of wage income. </li></ul>September 11, 2011
  49. 49. Types of Collective bargaining <ul><li>1. Effort and Productivity bargaining </li></ul><ul><li>Effort bargaining : where the amount of work to be accomplished for a predetermined wage becomes negotiable </li></ul><ul><li>Productivity bargaining: a process by which employers minimize or at least stabilize unit labour costs by getting more effective work done and by which employees obtain greater rewards for doing it . </li></ul><ul><li>2. Formal bargaining and informal bargaining </li></ul><ul><li>Frequently informal bargaining assumes more significance than formal bargaining…while formal bargaining consists of very limited range of issues informal bargaining may embrace wider issues involving tacit arrangements and understandings related to customs and practices </li></ul>September 11, 2011
  50. 50. <ul><li>Chamberlain & Kuhn </li></ul><ul><ul><li>Conjunctive bargaining </li></ul></ul><ul><ul><li>mutual coercion - indispensable to each other - Lose-lose </li></ul></ul><ul><ul><li>Cooperative bargaining </li></ul></ul><ul><ul><li>both accept neither will gain advantages unless the other gains too. Win-Win - willingness to concede - to increase size of cake </li></ul></ul><ul><li>Walton & McKersie </li></ul><ul><ul><li>Distributive bargaining </li></ul></ul><ul><ul><li>basic conflict over slice of the cake. Fixed-sum game - if you win, I lose. </li></ul></ul><ul><ul><li>Integrative bargaining (common perception & acceptance of issue) </li></ul></ul><ul><ul><li>Mgt accept employee influence. TU accepts business responsibility. </li></ul></ul><ul><ul><li>Cooperate to increase cake. Adversarial- cooperative tension remains </li></ul></ul><ul><ul><li>Flanders </li></ul></ul><ul><ul><li>Restrictive bargaining </li></ul></ul><ul><ul><li>Productivity bargaining </li></ul></ul>September 11, 2011
  51. 51. Content of Collective Bargaining <ul><li>Substantive rules (economic matters) </li></ul><ul><ul><li>pay (basic, overtime, PBR, guaranteed payments.....bonuses), hours (shifts, shorter week, flexi-time) , holidays, fringe benefits (pension, sick pay etc), Annual negotiations. </li></ul></ul><ul><li>Procedural rules </li></ul><ul><ul><li>grievance, negotiating, disputes, redundancy, consultation, discipline matters </li></ul></ul><ul><li>Work methods/arrangements. The nature of work & how it is carried out. Flexibility, multi-skilling, productivity, assignments, teams, use of contractors, operating procedures </li></ul>September 11, 2011
  52. 52. Scope of bargaining <ul><li>A rule making or legislative process : it formulates the terms and conditions under which labour and management will cooperate and work together over certain stated period </li></ul><ul><li>An executive process : both management and trade union officials share the responsibility of enforcing the rules </li></ul><ul><li>A judicial process : in every collective agreement there is a grievance procedure to settle any dispute concerning the application of agreement </li></ul>September 11, 2011
  53. 53. Collective Bargaining Levels/Structure <ul><li>Plant Level : Management-Unions in the plant </li></ul><ul><li>Industry Level : Several units in same industry form an association/unions and bargain for common cause </li></ul><ul><li>National Level : Here the bargaining is between federation(s) of unions and an employer’s association </li></ul>September 11, 2011
  54. 54. Pre-requisites for making collective bargaining a viable process <ul><li>Freedom of Association </li></ul><ul><li>Stability of worker’s organizations </li></ul><ul><li>A favourable political climate </li></ul><ul><li>Recognition of Trade unions </li></ul><ul><li>Willingness to ‘give and take’ </li></ul><ul><li>Avoidance of unfair labour practices </li></ul><ul><li>Signing of collective agreement and its implementation </li></ul>September 11, 2011
  55. 55. Elements of Collective Bargaining <ul><li>Issues for consideration </li></ul><ul><li>Issues pertaining to union recognition and union security </li></ul><ul><li>Issues related to employment relationship </li></ul><ul><li>Wage related issues </li></ul><ul><li>Supplementary economic benefits </li></ul><ul><li>Administrative issues </li></ul>September 11, 2011
  56. 56. <ul><li>Machinery and procedure through which these issues are considered (Negotiation and bargaining power) </li></ul><ul><li>Union tactics like strikes and boycotts </li></ul><ul><li>Management strategies like lockouts etc. </li></ul><ul><li>Third party intervention such as arbitration, adjudication </li></ul><ul><li>The agreement </li></ul><ul><li>Voluntary agreements </li></ul><ul><li>Settlements </li></ul><ul><li>Interpretation/Implementation of the agreement </li></ul>September 11, 2011
  57. 57. Phases of Collective Bargaining Process <ul><li>Dale Yoder identifies two major phases of Collective bargaining process </li></ul><ul><li>Negotiation phase : advancing proposals, discussing and criticizing, explaining and exploring their meaning and effects, seeking to secure their acceptance and making counter-proposals or modifications for similar evaluation. </li></ul><ul><li>Administration phase : Contract administration related to putting the signed agreement into effect. </li></ul>September 11, 2011
  58. 58. Phases of Collective bargaining contd…. <ul><li>Dunlop and Healy identifies three phases : </li></ul><ul><li>Bargaining demands </li></ul><ul><li>The deadline or threat of strike or lockout </li></ul><ul><li>Changing positions and reaching agreement </li></ul>September 11, 2011
  59. 59. The process of Collective Bargaining <ul><li>Phase1: </li></ul><ul><li>1.Registration of union </li></ul><ul><li>2. Recognition of union </li></ul><ul><li>Phase 2:Preparation for Negotiations by management and unions </li></ul><ul><li>Data collection </li></ul><ul><li>Policy formulation </li></ul><ul><li>Management strategy planning </li></ul><ul><li>Union strategy </li></ul>September 11, 2011
  60. 60. <ul><li>Phase3: Bargaining </li></ul><ul><li>Options : </li></ul><ul><li>rejection of all demands, </li></ul><ul><li>considering a few, </li></ul><ul><li>temporary suspension to study the implications , </li></ul><ul><li>counter demands </li></ul><ul><li>Criteria for bargaining : </li></ul><ul><li>give and take, </li></ul><ul><li>open communication, </li></ul><ul><li>read the hidden agenda, </li></ul><ul><li>identify striking point of other side </li></ul>September 11, 2011
  61. 61. <ul><li>Strategies for bargaining : </li></ul><ul><li>distributive, </li></ul><ul><li>integrative, </li></ul><ul><li>intra organizational bargaining </li></ul><ul><li>Bargaining power of parties : </li></ul><ul><li>persuasion, </li></ul><ul><li>negotiation, </li></ul><ul><li>coercion </li></ul><ul><li>Phase 4:Collective agreement </li></ul><ul><li>Phase 5: Administration </li></ul>September 11, 2011
  62. 62. Hurdles to collective bargaining in India <ul><li>Problems in recognition of Trade unions </li></ul><ul><li>Trade unions still form a very small portion of the total industrial employment </li></ul><ul><li>Unions too weak to bargain collectively on account of their small membership, poor finances, multiplicity etc. </li></ul><ul><li>Inter union and intra-union rivalries </li></ul><ul><li>Lot of restrictions on the rights of employers and employees to lockout and strikes </li></ul><ul><li>Unfavourable political and economic climate </li></ul>September 11, 2011
  63. 63. Recommendations of the National Commission of Labour for successful functioning of Collective bargaining in India <ul><li>Government intervention should be reduced particularly in settlements of industrial disputes </li></ul><ul><li>Trade unions should be strengthened </li></ul><ul><li>Legal provisions may be made either by a separate legislation or by amending existing enactments </li></ul>September 11, 2011
  64. 64. Workers participation <ul><li>The International Labour Organization states the implications of Workers Participation in Management as follows: </li></ul><ul><li>Workers have ideas which can be useful </li></ul><ul><li>Effective communications upwards are essential to sound decision making at the top </li></ul><ul><li>Workers may accept decisions better if they participate in them </li></ul><ul><li>Workers may work more intelligently as they are better informed about the reasons for and the intention of the decision </li></ul><ul><li>Workers may work harder if they share in decisions that affect them </li></ul><ul><li>Workers participation may foster a more cooperative attitude amongst workers and management, thus raising efficiency by improving team work and reducing the loss of efficiency arising from industrial disputes </li></ul><ul><li>Workers participation may act as a spur to managerial efficiency </li></ul>
  65. 65. Varying Definitions <ul><li>Virmani in his theme paper for the Indo-German seminar on “Worker’s Participation in Management” provides a comprehensive analysis of this concept…According to him, there are two schools of thought on the concept of Participation… </li></ul><ul><li>The first school of thought holds that the extension of democracy in industry involves the acceptance of strong as well as loyal opposition, which seeks to oppose the management in the interest of well being of workers. Once trade unions become a part of management, they cease to be opposition and this will negate the institution of democracy to the organization </li></ul><ul><li>The second school of thought holds that the basis of an industrial organization is collaboration and both the parties cannot survive unless they collaborate with each other on equal terms </li></ul>
  66. 66. Forms of Participation <ul><li>Informative : only inform </li></ul><ul><li>Consultative: consult before taking decision </li></ul><ul><li>Associative: seek suggestions from workers </li></ul><ul><li>Administrative: decisions are already taken, implementation method can vary </li></ul><ul><li>Decisive: Decisions are taken together (management and workers) </li></ul>
  67. 67. Prerequisites to worker’s Participation <ul><li>Based on the experience of the varied models of worker’s participation in Britain, Germany, Yugoslavia and India, Virmani suggests following prerequisites to worker’s participation in Management: </li></ul><ul><li>Need for clearly laid down objectives for the worker’s participation in management </li></ul><ul><li>Need for more focus on lower level participation </li></ul><ul><li>Need for real sharing of information </li></ul><ul><li>Need for direct worker’s participation </li></ul><ul><li>Need for modifying trade union objectives </li></ul><ul><li>Need for effective trade unions </li></ul><ul><li>Need for workers’ education </li></ul><ul><li>Inadequacy of consultation </li></ul><ul><li>Collective bargaining not a substitute for worker’s participation </li></ul><ul><li>Need for mediation </li></ul><ul><li>Need for Legislative support </li></ul><ul><li>Management styles and structure of organization </li></ul><ul><li>Managerial participation </li></ul><ul><li>Direct partnership between participation and productivity </li></ul>
  68. 68. Employee discipline <ul><ul><li>According to Richard D. Calhoon, “Discipline is the force that prompts individuals or groups to observe rules, regulations, standards and procedures deemed necessary for an organization.” </li></ul></ul><ul><li>Therefore discipline means securing consistent behaviour in accordance with the accepted norms of behaviour. As discipline is essential in every aspect of life it is equally essential in industrial undertakings. </li></ul><ul><li>Simply stated, discipline means orderliness . It implies the absence of chaos, irregularity and confusion in the behaviour of workers . </li></ul>
  69. 69. Nature of Discipline <ul><li>According to Megginson, discipline involves the following three things. </li></ul><ul><li>Self-discipline implies that a person brings the discipline in himself with a determination to achieve the goals that he has set for himself in life. </li></ul><ul><li>Orderly behaviors refers to discipline as a condition that must exist for an orderly behaviors in the organization. </li></ul><ul><li>Punishment is used to prevent indiscipline. When a worker goes astray in his conduct, he has to be punished for the same and the recurrences of it must be prevented. </li></ul>
  70. 70. OBJECTIVES OF DISCIPLINE <ul><li>To gain willing adherence of the rules, regulations and procedure of an organization . </li></ul><ul><li>element of uniformity despite several differences in informal behaviour </li></ul><ul><li>desire among employees to make adjustments </li></ul><ul><li>seek direction and responsibility among employees </li></ul><ul><li>atmosphere of respect for the human relation </li></ul><ul><li>enhance the working efficiency and morale of the employees </li></ul>
  71. 71. Discipline can either be positive or negative <ul><li>Positive Discipline </li></ul><ul><ul><li>Positive discipline involves creation of an atmosphere in the organization whereby employees willingly conform to the established rules and regulations. Positive discipline can be achieved through rewards and effective leadership. </li></ul></ul><ul><li>Negative Discipline </li></ul><ul><ul><li>Under negative discipline, penalties are used to force the workers to obey rules and regulations. In other words, workers try to adhere to rules and regulations out of fear of warnings, penalties and other forms of punishment. This approach to discipline is called negative or punitive approach. </li></ul></ul>
  72. 72. Positive discipline <ul><li>*positive support and reinforcement for approved actions </li></ul><ul><li>*molding behavior and developing in a supportive manner </li></ul><ul><li>*adequate compensation and incentives </li></ul><ul><li>*appropriate avenues for career growth and advancement, proper evaluation of performance and reinforcement of approved personnel behavior or actions </li></ul><ul><li>*self control </li></ul>
  73. 73. Positive discipline <ul><li>Maitra provides an excellent analysis of positive discipline. He points out, that the term ‘discipline’ is the most widely used word in industry and one of the most misinterpreted. </li></ul><ul><li>Discipline means a system of rules or training which generates orderliness and imbibes in a person a sense of obedience and self control…however by and large discipline is taken as a negative concept focusing on the idea of punishment. </li></ul>
  74. 74. What really happens at work <ul><li>It is generally assumed that when an individual becomes a manager he accepts responsibility for the discipline of those below him </li></ul><ul><li>It is found that attainment of effective production depends on positive discipline, not on punishment </li></ul><ul><li>The object is to have people who want to work, who have pride in their accomplishment and who realize that they help themselves when they help the company </li></ul>
  75. 75. Stimulating positive Discipline <ul><li>Maitra identifies the following measures to stimulate discipline in organizational settings: </li></ul><ul><li>Developing stronger ties between subordinates and the company </li></ul><ul><li>Developing a sense of belongingness and friendly climate </li></ul><ul><li>Making subordinates aware of the behaviour expected of them </li></ul><ul><li>Apply rules equally without favour or fervour </li></ul><ul><li>Consistent and firm handling </li></ul><ul><li>Action should be based on seriousness of the offence and record of the offender </li></ul><ul><li>The corrective action must state what not to do , what to do and why </li></ul><ul><li>The outcome of action: the correct behaviour must be strengthened from time to time </li></ul><ul><li>Setting examples </li></ul>
  76. 76. Negative discipline <ul><li>they do not show the desired standard of behavior </li></ul><ul><li>discipline programmed forces and constraints the employees to obey orders and functions in accordance with set rules and regulations of the organization through warnings ,penalties and other forms of punishment </li></ul>
  77. 77. Symptoms of general indiscipline <ul><li>Change in the normal behaviors </li></ul><ul><li>Absenteeism </li></ul><ul><li>Increased grievances </li></ul><ul><li>Lack of concern for performance </li></ul><ul><li>Go slow </li></ul><ul><li>Disorderly behaviors </li></ul><ul><li>Lack of concern for job </li></ul><ul><li>Late coming etc </li></ul>
  78. 78. Causes Of Indiscipline <ul><li>Unfair Management Practices: Management sometimes indulges in unfair practices like: </li></ul><ul><ul><li>Wage discrimination </li></ul></ul><ul><ul><li>Non-compliance with promotional policies and transfer policies </li></ul></ul><ul><ul><li>Discrimination in allotment of work </li></ul></ul><ul><ul><li>Defective handling of grievances </li></ul></ul><ul><ul><li>Payment of low wages </li></ul></ul><ul><ul><li>Delay in payment of wages </li></ul></ul><ul><ul><li>Creating low quality work life etc. </li></ul></ul><ul><li>These unfair management practices gradually result in indiscipline. </li></ul><ul><li>(ii) Absence of Effective Leadership : Absence of effective leadership results in poor management in the areas of direction, guidance, instructions etc. This in turn, results in indiscipline. </li></ul>
  79. 79. Causes Of Indiscipline <ul><li>(iii) Communication Barriers: Communication barriers and absence of humane approach on the part of superiors result in frustration and indiscipline among the workers. The management should clearly formulate the policies regarding discipline. These policies should be communicated and the policies should be consistently followed in the organizations. The management should also be empathetic towards the employees. </li></ul><ul><li>(iv) Inadequate attention to personnel Problems : Delay in solving personnel problems develops frustration among individual workers. The management should be proactive so that there is no discontent among the workers. It should adopt a parental attitude towards its employees. However it should be noted that no relationship can continue for long if it is one sided. What I am implying here is that the workers should also live up to their commitments. They should be reasonable in their demands. </li></ul>
  80. 80. <ul><li>(v) Victimization: Victimization of subordinate also results in indiscipline. The management should not exploit the workers. It is also in the long-term interest of the management to take care of its internal customers </li></ul><ul><li>(vi) Absence of Code of Conduct . This creates confusion and also provides chance for discrimination while taking disciplinary action. </li></ul>
  81. 81. DISCIPLINARY PROCEDURE <ul><li>1. Issue of charge sheet: Once the prima facie case of misconduct is established, the management should proceed to issue a charge sheet to the employee. Charge sheet is merely a notice of the charge and provides the employee an opportunity to explain his conduct. </li></ul><ul><li>Therefore, charge sheet is generally known as a slow cause notice. In the charge sheet, each charge should be clearly specified. There should be a separate charge for each allegation and charge should not relate to any matter, which has already been decided upon. </li></ul>
  82. 82. <ul><li>2 . Consideration of Explanation. On getting the answer for the charge sheet served, the explanation furnished should be considered and if it is satisfactory, no disciplinary action needs to be taken. </li></ul><ul><li>On the contrary when the management is not satisfied with the employee’s explanation, it can proceed with full-fledged enquiry. (However, if the worker admits the charge, the employer can warn him or award him punishment without further enquiry.) </li></ul>
  83. 83. DISCIPLINARY PROCEDURE <ul><li>3 . Suspension pending Enquiry. In case the charge is grave that is serious, a suspension order may be served on the employee along with the charge sheet. According to the Industrial Employment (Standing Order) Act, 1946, the suspended worker is to be paid a subsistence allowance equal to one-half of his wages for the first ninety days of suspension and three-fourths of wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings is not due to the worker’s conduct. </li></ul><ul><li>What is grave will depend on the discretion of the management. It has to be decided in accordance with the Code Of Discipline. </li></ul>
  84. 84. <ul><li>4. Holding of Enquiry. An enquiry officer should be appointed to hold the enquiry and a notice to this effect should be given to the concerned worker. Principle of natural justice must be followed . </li></ul><ul><li>The worker should not be denied the chance of explaining himself. The enquiry officer should give sufficient notice to the worker so that he may prepare to represent his case and make submission in his defense. </li></ul><ul><li>The enquiry officer should proceed in a proper manner and examine witnesses. Fair opportunity should be given to the worker to cross-examine the management witnesses. </li></ul>
  85. 85. <ul><li>5. Order of Punishment. Disciplinary action can be taken when the misconduct of the employee is proved. While deciding the nature of disciplinary action, the employee’s previous record, precedents, effects of the action on other employees, etc, have to be considered. </li></ul>
  86. 86. Principles of industrial discipline <ul><li>Discipline is intimately linked with relations within the organization and is affected by such factors as background, social environment and emotional outlook of the workers concerned. </li></ul><ul><li>Discipline is also closely related with personal feelings or sentiments. The sentiments are non-logical emotional factors that influence the behavior of average worker. Therefore, the effective application of discipline depends primarily on understanding the behavior of human beings and of one self. </li></ul><ul><li>The Code of Discipline must be laid down in consultation with those who are under its jurisdiction and are concerned with its application. </li></ul><ul><li>Code of Discipline should be evaluated and appraised from time to time so as to remove anomalies. If any. </li></ul><ul><li>Code of Discipline must be reasonable and simple. It should not contain rules for the sake of rules only. </li></ul>
  87. 87. Principles of Industrial Discipline <ul><li>The discipline policy should lay greater emphasis on the prevention of the breach of discipline than on the administration of venalities. The approach to discipline should be positive and constructive. </li></ul><ul><li>Judicious machinery preferably internal to the organization should be provided for appeals against, and review of, all disciplinary actions. </li></ul><ul><li>The management should ensure that its own conduct and policies do not encourage breach of discipline. This will promote self-discipline among the workers. </li></ul><ul><li>The managers should try to remove the cause responsible for indiscipline. </li></ul><ul><li>A disciplinary committee consisting of the representatives of the workers and the management should be set up to look into the cases of indiscipline and suggest remedial measures. </li></ul>
  88. 88. Characteristics of a Sound Disciplinary System (Red Hot Stove Rule) <ul><li>Discipline should be imposed without generating resentment. Mc Gregor propounded the “red hot stove rule” which says that a sound and effective disciplinary system in an organization should have the following characteristics- </li></ul><ul><li>Immediate- Just as when you touch a red hot stove, the burn is immediate, similarly the penalty for violation should be immediate/ immediate disciplinary action must be taken for violation of rules. </li></ul><ul><li>Consistent- Just as a red hot stove burns everyone in same manner; likewise, there should be high consistency in a sound disciplinary system. </li></ul><ul><li>Impersonal- Just as a person is burned because he touches the red hot stove and not because of any personal feelings, likewise, impersonality should be maintained by refraining from personal or subjective feelings. </li></ul>
  89. 89. <ul><li>Prior warning and notice- Just as an individual has a warning when he moves closer to the stove that he would be burned on touching it, likewise, a sound disciplinary system should give advance warning to the employees as to the implications of not conforming to the standards of behavior/code of conduct in an organization. </li></ul><ul><li>In short, a sound disciplinary system presupposes- </li></ul><ul><li>Acquaintance/Knowledge of rules </li></ul><ul><li>Timely action </li></ul><ul><li>Fair and just action </li></ul><ul><li>Positive approach </li></ul>
  90. 90. Code of Discipline <ul><li>The code of Discipline forms the Gandhian approach to industrial relations to bind employees and trade unions to a moral agreement for promoting peace and harmony. </li></ul><ul><li>It was an outcome of the efforts of Gulzari Lal Nanda, the union Labour Minister in 1957 and 1958. </li></ul><ul><li>It was formally adopted at the 16 th session of the Indian Labour Conference (1958) </li></ul><ul><li>The code was a unique formulation to voluntarily regulate labour-management relations. Indian Labour Conference discussed three draft codes including: </li></ul><ul><li>Code of Conduct to regulate inter-union relations </li></ul><ul><li>Code of Discipline to regulate labour–management relations </li></ul><ul><li>Code of Efficiency and Welfare for laying down norms of productivity and labour welfare </li></ul><ul><li>The third code was never formally adopted and did not take off </li></ul>
  91. 91. What does the Code cover <ul><li>The code embodies four parts: </li></ul><ul><li>Part I contains the duties and responsibilities of employers, workers and the government in maintaining discipline in industry </li></ul><ul><li>Part II enlists the common obligations of management and unions </li></ul><ul><li>Part III deals with the obligations of management only, while </li></ul><ul><li>Part IV relates to those of unions only </li></ul>
  92. 92. Significance of the Code <ul><li>The code is highly comprehensive and ethical in its approach to the industrial relations system </li></ul><ul><li>The code of discipline asserts that employers and workers should utilize the existing machinery for the settlement of disputes and avoid direct action and that there should be just and fair recognition by the two parties of each other’s rights and responsibilities. </li></ul><ul><li>According to National Commission of Labour , the Code still has had very limited success. </li></ul>
  94. 94. GRIEVANCE HANDLING <ul><li>According to International Labor Organization, “Grievance is a complaint of one or more workers in respect of wages, allowances, conditions of work & interpretations of service stipulations covering such areas as overtime, leave, transfer, promotion, seniority, job assignment & termination of service.” </li></ul><ul><li>According to Michael Jucius, “A grievance can be any discontent or dissatisfaction, whether expressed or not, whether valid or not, and arising out of anything connected with the company that an employee thinks, believes, or even feels as unfair, unjust or inequitable.” </li></ul><ul><li>A grievance means any discontentment or dissatisfaction in an employee arising out of anything related to the enterprise where he is working. It may not be expressed and even may not be valid. </li></ul>
  95. 95. NATURE OF GRIEVANCE <ul><li>It arises when an employee feels that something has happened or is going to happen which is unfair, unjust or inequitable . Thus, a grievance represents a situation in which an employee feels that something unfavorable to him has happened or is going to happen. In an industrial enterprise, an employee may have grievance because of long hours of work, non-fulfillment of terms of service by the management, unfair treatment in promotion, poor working facilities, etc. </li></ul><ul><li>Grievances are symptoms of conflicts in the enterprise so they should be handled very promptly and efficiently. </li></ul><ul><li>While dealing with grievances of sub-ordinates, it is necessary to keep in mind the following points: </li></ul><ul><li>A grievance may or may not be real. </li></ul><ul><li>Grievance may arise out of not one cause but out of multifarious causes. </li></ul><ul><li>Every individual does not give expression to his grievance. </li></ul>
  96. 96. FORMS OF GRIEVANCES <ul><li>Factual: When an employee is dissatisfied with his job, for genuine or factual reasons like a breach of terms of employment or any other reasons that are attributable to the man arrangement. </li></ul><ul><li>Imaginary: When an employees grievance or dissatisfaction is not because of any factual or valid reason but because of wrong perception, wrong attitude or wrong information he has. </li></ul><ul><li>Disguised: An employee may have dissatisfaction for that are unknown to himself. This may be because of pressures or frustrations that an employee is feeling from other sources like his personal behavior. </li></ul>
  97. 97. IDENTIFYING GRIEVANCES <ul><li>EXIT INTERVIEW : Employees usually quit organizations due to dissatisfaction or better prospective. Exit interviews, if conducted carefully, can provide important information about employee grievances. This can help the management to gather feedback and to genuinely incorporate feedback. </li></ul><ul><li>GRIPE BOXES: These are the boxes in which the employees can drop their anonymous complaints. </li></ul><ul><li>OPINION SURVEY: The management can be proactive by conducting group meetings, periodical interviews with employees, collective bargaining sessions etc through which one can get information about employees dissatisfaction. </li></ul><ul><li>OPEN DOOR POLICY: Some organizations extend a general invitation to their employees to informally drop in the manager’s room any time and talk over their grievances. The management should hold formal & informal meetings with the employees. </li></ul>
  98. 98. Causes of grievance <ul><li>ECONOMIC CAUSES: Wage fixation, overtime, incentive, allowances, increments etc are some of the causes responsible for grievance. </li></ul><ul><li>WORK ENVIRONMENT: Poor physical condition of workplace, stringent production norms, defective tools & equipment, unfair practices etc lead to grievances. </li></ul><ul><li>SUPERVISION: Relates to the attitude of the supervisor towards the employee such as perceived nation of bias, favoritism, regional feelings etc. </li></ul><ul><li>WORK GROUP: Employee is unable to adjust with his colleagues, suffers from feelings of neglect etc. </li></ul><ul><li>MISCELLANEOUS: issues relating to certain violations in respect of promotions, continuity of service, transfer, disciplinary actions, medical facilities etc. </li></ul>
  99. 99. Effects of Grievances: <ul><li>Alienation </li></ul><ul><li>De-motivation </li></ul><ul><li>Slackness </li></ul><ul><li>Low Productivity </li></ul><ul><li>Increase in Wastage & Costs </li></ul><ul><li>Absenteeism </li></ul><ul><li>In discipline </li></ul><ul><li>Labour unrest </li></ul>
  100. 100. OBJECTIVES OF GRIEVANCE HANDLING <ul><li>To enable the employees to air his/her grievance. </li></ul><ul><li>To clarify the nature of the grievance. </li></ul><ul><li>To investigate the reasons for dissatisfaction. </li></ul><ul><li>To obtain, where possible, a speedy resolution to the problem. </li></ul><ul><li>To take appropriate actions and ensure that promises are kept. </li></ul><ul><li>To inform the employees of his/her right to take the grievance to next stage of the procedure, in the event of an unsuccessful resolution. </li></ul>
  101. 101. Grievances Classification <ul><li>Grievances resulting from working conditions </li></ul><ul><li>Improper matching of the worker with the job. </li></ul><ul><li>Changes in schedules or procedures. </li></ul><ul><li>Non-availability of proper tools, machines and equipment for doing the job. </li></ul><ul><li>Unreasonably high production standards. </li></ul><ul><li>Poor working conditions. </li></ul><ul><li>Bad employer – employee relationship, etc. </li></ul><ul><li>Grievances resulting from management policy </li></ul><ul><li>Wage payment and job rates. </li></ul><ul><li>Leave. </li></ul><ul><li>Overtime. </li></ul><ul><li>Seniority and Promotional. </li></ul><ul><li>Transfer. </li></ul><ul><li>Disciplinary action. </li></ul><ul><li>Lack of employee development plan. </li></ul><ul><li>Lack of role clarity. </li></ul>
  102. 102. <ul><li>Grievances resulting from personal maladjustment </li></ul><ul><li>(i) Over – ambition. </li></ul><ul><li>(ii) Excessive self-esteem or what we better know as ego. </li></ul><ul><li>(iii) Impractical attitude to life etc. </li></ul>
  103. 103. Guidelines for Effective Grievance Handling <ul><li>A grievance should be dealt with in the first instance at the lowest level : that is, an employee should raise his grievance with his immediate superior . It may be simple to settle it on the spot and that will be the end of it. Even if it cannot be settled at that level, the man’s superior will know what is happening. This is necessary not only to maintain his authority, but also to prevent him from being aggrieved, as he will certainly be, if he is by-passed and hears of the complaint from his own superior. </li></ul><ul><li>It must be made clear to the employee what line of appeal is available. If he cannot get satisfaction from his immediate superior, he should know the next higher authority to which he can go. </li></ul><ul><li>Since delay causes frustration and tempers may rise and rumors spread around the work, it is essential that grievances should be dealt with speedily. As it is said that a stitch in time saves nine, similarly the problems of the employees should be taken care of by the management least it should become a major for the management. </li></ul>
  104. 104. <ul><li>The grievance procedure should be set up with the participation of the employees and it should be applicable to all in the organization. The policies and rules regarding grievances should be laid down after taking inputs from the employees and it should be uniformly applicable to all in the organization. It should be agreed that there would be no recourse to the official machinery of conciliation unless the procedure has been carried out and there is still dissatisfaction, and moreover, there must be no direct action on either side, which might prejudice the case or raise tempers while the grievance is being investigated. </li></ul>
  105. 105. <ul><li>The complaint should be given a patient hearing by his superior. He should be allowed to express himself completely. The management should be empathetic. </li></ul><ul><li>The superior should try to get at the root of the problem. It should be remembered that symptoms are not the problems. It should also be noted that if there are symptoms, there would be a problem as well. </li></ul><ul><li>The management must show it anxiety to remove the grievances of the workers. The workers should feel that the management is genuinely interested in solving its problems. </li></ul><ul><li>If the grievances are real and their causes located, attempts should be made to remove the causes. </li></ul><ul><li>If the grievances are imaginary or unfounded, attempts should be made to convince the workers. </li></ul><ul><li>Every grievance must be handled within the reasonable time limit. </li></ul>
  106. 106. <ul><li>All grievances should be put into writing. Some proofs required as well…. </li></ul><ul><li>Relevant facts about the grievance must be gathered. The management should not haste! </li></ul><ul><li>Decision taken to redress the grievance of the worker must be communicated to him. </li></ul><ul><li>Follow up action should be taken to know the response of the forced employee. This is to make sure that he is happy or not! At the end of the day the satisfaction of the aggrieved party is necessary. </li></ul>
  107. 107. ESSENTIAL PREREQUISITES OF A GRIEVANCE PROCEDURE <ul><li>The grievance procedure, to be sound and effective should possess certain prerequisites: </li></ul><ul><li>Conformity with statutory provisions: Due consideration must be given to the prevailing legislation while designing the grievance handling procedure. </li></ul><ul><li>Un ambiguity: Every aspect of the grievance handling procedure should be clear and easy to understand. </li></ul><ul><li>Simplicity: The procedure should be simple & short. </li></ul><ul><li>Promptness: The grievance of the employee should be promptly handled & necessary action must be taken immediately. </li></ul><ul><li>Training: The supervisors & the union representatives should be properly trained in all aspects of grievance handling beforehand. </li></ul><ul><li>Follow-up: The Personnel department should keep track of the effectiveness & functioning of grievance handling procedure. </li></ul>
  108. 108. KEY FEATURES OF A GOOD GRIEVANCE HANDLING PROCEDURE <ul><li>Three key features of handling grievance are: </li></ul><ul><li>FAIRNESS </li></ul><ul><li>PROCEDURAL STEPS </li></ul><ul><li>PROMPTNESS </li></ul>
  109. 109. GRIEVANCE MANAGEMENT IN INDIAN INDUSTRY <ul><li>At present there are three legislations dealing with the grievances of employees working in industries. </li></ul><ul><li>The Industrial Employment act, 1946, requires that every establishment employing 100 or more workers should frame standing orders. </li></ul><ul><li>These should contain, among other things, a provision for redressal of grievances of workers against unfair treatment and wrongful actions by employers or his agents. </li></ul><ul><li>The Factories Act, 1948, provides for the appointment of a welfare officer in every factory ordinarily employing 500 or more workers. </li></ul><ul><li>These welfare officers also look after complaints and grievances of workers & will also look after proper implementation of existing labor legislation. </li></ul>
  110. 110. <ul><li>Individual disputes relating to discharge, dismissal or retrenchment can be taken up for relief under the Industrial Disputes Act, 1947, as amended in 1965. </li></ul><ul><li>However, the existing labor legislation is not being implemented properly by the industries. There is a lack of fairness on the part of the employees. Welfare officers are also not taking their work seriously. </li></ul><ul><li>In India, a Model grievance procedure was adopted by the Indian Labor conference in its 16 th session held in 1958. </li></ul>