Industrial Relations Industrial relations is used to denote the collective relationships between managementand the workers. Traditionally, the term industrial relations is used to cover such aspects ofindustrial life as trade unionism, collective bargaining, workers’ participation in management,discipline and grievance handling, industrial disputes and interpretation of labor laws and rulesand code of conduct.In the words of Lester, "Industrial relations involve attempts at arriving at solutions between theconflicting objectives and values; between the profit motive and social gain; between disciplineand freedom, between authority and industrial democracy; between bargaining and co-operation;and between conflicting interests of the individual, the group and the community”.The National Commission on Labor (NCL) also emphasize on the same concept. According to NCL,industrial relations affect not merely the interests of the two participants- labor and management, butalso the economic and social goals to which the State addresses itself. To regulate these relations insocially desirable channels is a function, which the State is in the best position to perform.In fact, industrial relation encompasses all such factors that influence behavior of people at work. A fewsuch important factors are below:Institution: It includes government, employers, trade unions, union federations or associations,government bodies, labor courts, tribunals and other organizations which have direct or indirect impacton the industrial relations systems.Characters: It aims to study the role of workers unions and employers’ federations officials, shopstewards, industrial relations officers/ manager, mediator/conciliators / arbitrator, judges of labor court,tribunal etc.Methods: Methods focus on collective bargaining, workers’ participation in the industrial relationsschemes, discipline procedure, grievance redressal machinery, dispute settlements machinery workingof closed shops, union reorganization, organizations of protests through methods like revisions ofexisting rules, regulations, policies, procedures, hearing of labor courts, tribunals etc.Contents: It includes matter pertaining to employment conditions like pay, hours of works, leave withwages, health, and safety disciplinary actions, lay-off, dismissals retirements etc., laws relating to suchactivities, regulations governing labor welfare, social security, industrial relations, issues concerning withworkers’ participation in management, collective bargaining, etc.Introduction To Industrial RelationsIndustrial relations has become one of the most delicate and complex problems of modernindustrial society. Industrial progress is impossible without cooperation of labors and harmonious
relationships. Therefore, it is in the interest of all to create and maintain good relations betweenemployees (labor) and employers (management).Concept of Industrial Relations:The term ‘Industrial Relations’ comprises of two terms: ‘Industry’ and ‘Relations’. “Industry”refers to “any productive activity in which an individual (or a group of individuals) is (are)engaged”. By “relations” we mean “the relationships that exist within the industry between theemployer and his workmen.”The term industrial relations explains the relationship between employees and managementwhich stem directly or indirectly from union-employer relationship.Industrial relations are the relationships between employees and employers within theorganizational settings. The field of industrial relations looks at the relationship betweenmanagement and workers, particularly groups of workers represented by a union. Industrialrelations are basically the interactions between employers, employees and the government, andthe institutions and associations through which such interactions are mediated.The term industrial relations has a broad as well as a narrow outlook. Originally, industrialrelations was broadly defined to include the relationships and interactions between employersand employees. From this perspective, industrial relations covers all aspects of the employmentrelationship, including human resource management, employee relations, and union-management(or labor) relations. Now its meaning has become more specific and restricted. Accordingly,industrial relations pertains to the study and practice of collective bargaining, trade unionism,and labor-management relations, while human resource management is a separate, largelydistinct field that deals with nonunion employment relationships and the personnel practices andpolicies of employers.The relationships which arise at and out of the workplace generally include the relationshipsbetween individual workers, the relationships between workers and their employer, therelationships between employers, the relationships employers and workers have with theorganizations formed to promote their respective interests, and the relations between thoseorganizations, at all levels. industrial relations also includes the processes through which theserelationships are expressed (such as, collective bargaining, workers’ participation in decision-making, and grievance and dispute settlement), and the management of conflict betweenemployers, workers and trade unions, when it arises.Industrial Relation SystemAn industrial relations system consists of the whole gamut of relationships between employeesand employees and employers which are managed by the means of conflict and cooperation.A sound industrial relations system is one in which relationships between management andemployees (and their representatives) on the one hand, and between them and the State on theother, are more harmonious and cooperative than conflictual and creates an environment
conducive to economic efficiency and the motivation, productivity and development of theemployee and generates employee loyalty and mutual trust.Actors in the IR system:Three main parties are directly involved in industrial relations:Employers: Employers possess certain rights vis-à-vis labors. They have the right to hire and fire them.Management can also affect workers’ interests by exercising their right to relocate, close or merge thefactory or to introduce technological changes.Employees: Workers seek to improve the terms and conditions of their employment. They exchangeviews with management and voice their grievances. They also want to share decision making powers ofmanagement. Workers generally unite to form unions against the management and get support from theseunions.Government: The central and state government influences and regulates industrial relations through laws,rules, agreements, awards of court ad the like. It also includes third parties and labor and tribunal courts.SCOPE:The concept of industrial relations has a very wide meaning and connotation. In the narrowsense, it means that the employer, employee relationship confines itself to the relationship thatemerges out of the day to day association of the management and the labor. In its wider sense,industrial relations include the relationship between an employee and an employer in the courseof the running of an industry and may project it to spheres, which may transgress to the areas of
quality control, marketing, price fixation and disposition of profits among others.The scope or industrial relations is quite vast. The main issues involved here include thefollowing: 1. Collective bargaining 2. Machinery for settlement of industrial disputes 3. Standing orders 4. Workers participation in management 5. Unfair labor practicesImportance of Industrial Relations:The healthy industrial relations are key to the progress and success. Their significance may bediscussed as under –d Uninterrupted production – The most important benefit of industrial relations is that thisensures continuity of production. This means, continuous employment for all from manager toworkers. The resources are fully utilized, resulting in the maximum possible production. There isuninterrupted flow of income for all. Smooth running of an industry is of vital importance forseveral other industries; to other industries if the products are intermediaries or inputs; toexporters if these are export goods; to consumers and workers, if these are goods of massconsumption.cDisputes are reflections of the failure of basic human urges or motivations to secure adequatesatisfaction or expression which are fully cured by good industrial relations. Strikes, lockouts,go-slow tactics, gherao and grievances are some of the reflections of industrial unrest which donot spring up in an atmosphere of industrial peace. It helps promoting co-operation andincreasing production.
High morale – Good industrial relations improve the morale of the employees. Employeeswork with great zeal with the feeling in mind that the interest of employer and employees is oneand the same, i.e. to increase production. Every worker feels that he is a co-owner of the gains ofindustry. The employer in his turn must realize that the gains of industry are not for him alongbut they should be shared equally and generously with his workers. In other words, completeunity of thought and action is the main achievement of industrial peace. It increases the place ofworkers in the society and their ego is satisfied. It naturally affects production because mightyco-operative efforts alone can produce great results.cworkers and employees. The industrial peace lies ultimately in a transformed outlook on the partof both. It is the business of leadership in the ranks of workers, employees and Government towork out a new relationship in consonance with a spirit of true democracy. Both should thinkthemselves as partners of the industry and the role of workers in such a partnership should berecognized. On the other hand, workers must recognize employer’s authority. It will naturallyhave impact on production because they recognize the interest of each other.h Reduced Wastage – Good industrial relations are maintained on the basis of cooperation andrecognition of each other. It will help increase production. Wastages of man, material andmachines are reduced to the minimum and thus national interest is protected.Thus, it is evident that good industrial relations is the basis of higher production with minimumcost and higher profits. It also results in increased efficiency of workers. New and new projectsmay be introduced for the welfare of the workers and to promote the morale of the people atwork. An economy organized for planned production and distribution, aiming at the realizationof social justice and welfare of the massage can function effectively only in an atmosphere ofindustrial peace. If the twin objectives of rapid national development and increased social justiceare to be achieved, there must be harmonious relationship between management and labor.Objectives of Industrial Relations:The main objectives of industrial relations system are:- To safeguard the interest of labor and management by securing the highest level of mutualunderstanding and good-will among all those sections in the industry which participate in theprocess of production.p To avoid industrial conflict or strife and develop harmonious relations, which are an essentialfactor in the productivity of workers and the industrial progress of a country.f To raise productivity to a higher level in an era of full employment by lessening the tendencyto high turnover and frequency absenteeism. • To establish and promote the growth of an industrial democracy based on labor partnership in the sharing of profits and of managerial decisions, so that ban individuals personality may grow its full stature for the benefit of the industry and of the country as well.
• To eliminate or minimize the number of strikes, lockouts and gheraos by providing reasonable wages, improved living and working conditions, said fringe benefits. • To improve the economic conditions of workers in the existing state of industrial managements and political government. • Socialization of industries by making the state itself a major employer • Vesting of a proprietary interest of the workers in the industries in which they are employed.Dunlops Contribution To Industrial RelationsOne of the significant theories of industrial labor relations was put forth by John Dunlop in the1950s. According to Dunlop industrial relations system consists of three agents – managementorganizations, workers and formal/informal ways they are organized and government agencies.These actors and their organizations are located within an environment – defined in terms oftechnology, labor and product markets, and the distribution of power in wider society as itimpacts upon individuals and workplace. Within this environment, actors interact with eachother, negotiate and use economic/political power in process of determining rules that constitutethe output of the industrial relations system. He proposed that three parties—employers, laborunions, and government-- are thekey actors in a modern industrial relations system. He also argued that none of these institutionscould act in an autonomous or independent fashion. Instead they were shaped, at least to someextent, by their market, technological and political contexts.Thus it can be said that industrial relations is a social sub system subject to three environmentalconstraints- the markets, distribution of power in society and technology.Dunlops model identifies three key factors to be considered in conducting an analysis of themanagement-labor relationship: 1. Environmental or external economic, technological, political, legal and social forces that impact employment relationships. 2. Characteristics and interaction of the key actors in the employment relationship: labor, management, and government. 3. Rules that are derived from these interactions that govern the employment relationship.Dunlop emphasizes the core idea of systems by saying that the arrangements in the field ofindustrial relations may be regarded as a system in the sense that each of them more or lessintimately affects each of the others so that they constitute a group of arrangements for dealingwith certain matters and are collectively responsible for certain results”.In effect - Industrial relations is the system which produces the rules of the workplace. Such rulesare the product of interaction between three key “actors” – workers/unions, employers andassociated organizations and governmentThe Dunlop’s model gives great significance to external or environmental forces. In other words,
management, labor, and the government possess a shared ideology that defines their roles withinthe relationship and provides stability to the system.Unitary PerspectiveIn unitarism, the organization is perceived as an integrated and harmonious system, viewed asone happy family. A core assumption of unitary approach is that management and staff, and allmembers of the organization share the same objectives, interests and purposes; thus workingtogether, hand-in-hand, towards the shared mutual goals. Furthermore, unitarism has apaternalistic approach where it demands loyalty of all employees. Trade unions are deemed asunnecessary and conflict is perceived as disruptive.From employee point of view, unitary approach means that: • Working practices should be flexible. Individuals should be business process improvement oriented, multi-skilled and ready to tackle with efficiency whatever tasks are required. • If a union is recognized, its role is that of a further means of communication between groups of staff and the company. • The emphasis is on good relationships and sound terms and conditions of employment. • Employee participation in workplace decisions is enabled. This helps in empowering individuals in their roles and emphasizes team work, innovation, creativity, discretion in problem-solving, quality and improvement groups etc. • Employees should feel that the skills and expertise of managers supports their endeavors.From employer point of view, unitary approach means that: • Staffing policies should try to unify effort, inspire and motivate employees. • The organizations wider objectives should be properly communicated and discussed with staff. • Reward systems should be so designed as to foster to secure loyalty and commitment. • Line managers should take ownership of their team/staffing responsibilities. • Staff-management conflicts - from the perspective of the unitary framework - are seen as arising from lack of information, inadequate presentation of managements policies. • The personal objectives of every individual employed in the business should be discussed with them and integrated with the organization’s needs.Pluralistic-PerspectiveIn pluralism the organization is perceived as being made up of powerful and divergent sub-groups -
management and trade unions. This approach sees conflicts of interest and disagreements betweenmanagers and workers over the distribution of profits as normal and inescapable. Consequently, the roleof management would lean less towards enforcing and controlling and more toward persuasion and co-ordination. Trade unions are deemed as legitimate representatives of employees. Conflict is dealt bycollective bargaining and is viewed not necessarily as a bad thing and if managed could in fact bechanneled towards evolution and positive change.Realistic managers should accept conflict to occur.There is a greater propensity for conflict rather than harmony.They should anticipate and resolve this by securing agreed procedures for settling disputes.The implications of this approach include: • The firm should have industrial relations and personnel specialists who advise managers and provide specialist services in respect of staffing and matters relating to union consultation and negotiation. • Independent external arbitrators should be used to assist in the resolution of disputes. • Union recognition should be encouraged and union representatives given scope to carry out their representative duties • Comprehensive collective agreements should be negotiated with unionsMarxist PerspectiveThis view of industrial relations is a by product of a theory of capitalist society and socialchange. Marx argued that:cthe ascendancy of socialism over capitalism.t Capitalism would foster monopolies.t Wages (costs to the capitalist) would be minimized to a subsistence level.t Capitalists and workers would compete/be in contention to win ground and establish theirconstant win-lose struggles would be evident.
This perspective focuses on the fundamental division of interest between capital and labor, andsees workplace relations against this background. It is concerned with the structure and nature ofsociety and assumes that the conflict in employment relationship is reflective of the structure ofthe society. Conflict is therefore seen as inevitable and trade unions are a natural response ofworkers to their exploitation by capital.Collective BargainingCollective bargaining is process of joint decision making and basically represents a democraticway of life in industry. It is the process of negotiation between firm’s and workers’representatives for the purpose of establishing mutually agreeable conditions of employment. Itis a technique adopted by two parties to reach an understanding acceptable to both through theprocess of discussion and negotiation.ILO has defined collective bargaining as, negotiation about working conditions and terms ofemployment between an employer and a group of employees or one or more employee,organization with a view to reaching an agreement wherein the terms serve as a code of definingthe rights and obligations of each party in their employment/industrial relations with one another.Collective bargaining involves discussions and negotiations between two groups as to the termsand conditions of employment. It is called ‘collective’ because both the employer and theemployee act as a group rather than as individuals. It is known as ‘bargaining’ because themethod of reaching an agreement involves proposals and counter proposals, offers and counteroffers and other negotiations.Thus collective bargaining: • is a collective process in which representatives of both the management and employees participate. • is a continuous process which aims at establishing stable relationships between the parties involved. • not only involves the bargaining agreement, but also involves the implementation of such an agreement. • attempts in achieving discipline in the industry
• is a flexible approach, as the parties involved have to adopt a flexible attitude towards negotiations.Bargaining Form And TacticsA collective bargaining process generally consists of four types of activities- distributivebargaining, integrative bargaining, attitudinal restructuring and intra-organizational bargaining.Distributive bargaining: It involves haggling over the distribution of surplus. Under it, theeconomic issues like wages, salaries and bonus are discussed. In distributive bargaining, oneparty’s gain is another party’s loss. This is most commonly explained in terms of a pie.Disputants can work together to make the pie bigger, so there is enough for both of them to haveas much as they want, or they can focus on cutting the pie up, trying to get as much as they canfor themselves. In general, distributive bargaining tends to be more competitive. This type ofbargaining is alsoknown as conjunctive bargaining.Integrative bargaining:This involves negotiation of an issue on which both the parties may gain, or at least neither partyloses. For example, representatives of employer and employee sides may bargain over the bettertraining programme or a better job evaluation method. Here, both the parties are trying to makemore of something. In general, it tends to be more cooperative than distributive bargaining. Thistype of bargaining is also known as cooperative bargaining.Attitudinal restructuring:This involves shaping and reshaping some attitudes like trust or distrust, friendliness or hostilitybetween labor and management. When there is a backlog of bitterness between both the parties,attitudinal restructuring is required to maintain smooth and harmonious industrial relations. Itdevelops a bargaining environment and creates trust and cooperation among the parties.Intra-organizational bargaining:It generally aims at resolving internal conflicts. This is a type of maneuvering to achieveconsensus with the workers and management. Even within the union, there may be differencesbetween groups. For example, skilled workers may feel that they are neglected or womenworkers may feel that their interests are not looked after properly. Within the management also,there may be differences. Trade unions maneuver to achieve consensus among the conflictinggroups.Characterstics Of Collective BargainingC It is a group process, wherein one group, representing the employers, and the other, representing theemployees, sit together to negotiate terms of employment.econsiderable scope for discussion, compromise or mutual give and take in collective bargaining.
Collective bargaining is a formalized process by which employers and independent trade unionsnegotiate terms and conditions of employment and the ways in which certain employment-relatedissues are to be regulated at national, organizational and workplace levels. • Collective bargaining is a process in the sense that it consists of a number of steps. It begins with the presentation of the charter of demands and ends with reaching an agreement, which would serve as the basic law governing labor management relations over a period of time in an enterprise. Moreover, it is flexible process and not fixed or static. Mutual trust and understanding serve as the by products of harmonious relations between the two parties. • It a bipartite process. This means there are always two parties involved in the process of collective bargaining. The negotiations generally take place between the employees and the management. It is a form of participation. • Collective bargaining is a complementary process i.e. each party needs something that the other party has; labor can increase productivity and management can pay better for their efforts. • Collective bargaining tends to improve the relations between workers and the union on the one hand and the employer on the other. • Collective Bargaining is continuous process. It enables industrial democracy to be effective. It uses cooperation and consensus for settling disputes rather than conflict and confrontation. • Collective bargaining takes into account day to day changes, policies, potentialities, capacities and interests. • It is a political activity frequently undertaken by professional negotiators.Collective Bargaining ProcessCollective bargaining generally includes negotiations between the two parties (employees’representatives and employer’s representatives). Collective bargaining consists of negotiations
between an employer and a group of employees that determine the conditions of employment.Often employees are represented in the bargaining by a union or other labor organization. Theresult of collective bargaining procedure is called the collective bargaining agreement (CBA).Collective agreements may be in the form of procedural agreements or substantive agreements.Procedural agreements deal with the relationship between workers and management and theprocedures to be adopted for resolving individual or group disputes.This will normally include procedures in respect of individual grievances, disputes anddiscipline. Frequently, procedural agreements are put into the company rule book which providesinformation on the overall terms and conditions of employment and codes of behavior. Asubstantive agreement deals with specific issues, such as basic pay, overtime premiums, bonusarrangements, holiday entitlements, hours of work, etc. In many companies, agreements have afixed time scale and a collective bargaining process will review the procedural agreement whennegotiations take place on pay and conditions of employment.The collective bargaining process comprises of five core steps: 1. Prepare: This phase involves composition of a negotiation team. The negotiation team should consist of representatives of both the parties with adequate knowledge and skills for negotiation. In this phase both the employer’s representatives and the union examine their own situation in order to develop the issues that they believe will be most important. The first thing to be done is to determine whether there is actually any reason to negotiate at all. A correct understanding of the main issues to be covered and intimate knowledge of operations, working conditions, production norms and other relevant conditions is required. 2. Discuss: Here, the parties decide the ground rules that will guide the negotiations. A process well begun is half done and this is no less true in case of collective bargaining. An environment of mutual trust and understanding is also created so that the collective bargaining agreement would be reached. 3. Propose: This phase involves the initial opening statements and the possible options that exist to resolve them. In a word, this phase could be described as ‘brainstorming’. The exchange of messages takes place and opinion of both the parties is sought. 4. Bargain: negotiations are easy if a problem solving attitude is adopted. This stage comprises the time when ‘what ifs’ and ‘supposals’ are set forth and the drafting of agreements take place.
5. Settlement: Once the parties are through with the bargaining process, a consensual agreement is reached upon wherein both the parties agree to a common decision regarding the problem or the issue. This stage is described as consisting of effective joint implementation of the agreement through shared visions, strategic planning and negotiated change.Importance Of Collective BargainingCollective bargaining includes not only negotiations between the employers and unions but alsoincludes the process of resolving labor-management conflicts. Thus, collective bargaining is,essentially, a recognized way of creating a system of industrial jurisprudence. It acts as a methodof introducing civil rights in the industry, that is, the management should be conducted by rulesrather than arbitrary decision making. It establishes rules which define and restrict the traditionalauthority exercised by the management.Importance to employeesI Collective bargaining develops a sense of self respect and responsibility among theemployees. • It increases the strength of the workforce, thereby, increasing their bargaining capacity as a group. • Collective bargaining increases the morale and productivity of employees. • It restricts management’s freedom for arbitrary action against the employees. Moreover, unilateral actions by the employer are also discouraged.
• Effective collective bargaining machinery strengthens the trade unions movement. • The workers feel motivated as they can approach the management on various matters and bargain for higher benefits. • It helps in securing a prompt and fair settlement of grievances. It provides a flexible means for the adjustment of wages and employment conditions to economic and technological changes in the industry, as a result of which the chances for conflicts are reduced.Importance to employers 1. It becomes easier for the management to resolve issues at the bargaining level rather than taking up complaints of individual workers. 2. Collective bargaining tends to promote a sense of job security among employees and thereby tends to reduce the cost of labor turnover to management. 3. Collective bargaining opens up the channel of communication between the workers and the management and increases worker participation in decision making. 4. Collective bargaining plays a vital role in settling and preventing industrial disputes.Importance to society 1. Collective bargaining leads to industrial peace in the country 2. It results in establishment of a harmonious industrial climate which supports which helps the pace of a nation’s efforts towards economic and social development since the obstacles to such a development can be reduced considerably. 3. The discrimination and exploitation of workers is constantly being checked.
4. It provides a method or the regulation of the conditions of employment of those who are directly concerned about them.Levels of Collective BargainingCollective bargaining operates at three levels:1. National level2. Sector or industry level3. Company/enterprise levelEconomy-wide (national) bargaining is a bipartite or tripartite form of negotiation betweenunion confederations, central employer associations and government agencies. It aims atproviding a floor for lower-level bargaining on the terms of employment, often taking intoaccount macroeconomic goals.Sectoral bargaining, which aims at the standardization of the terms of employment in oneindustry, includes a range ofbargaining patterns. Bargaining may be either broadly or narrowly defined in terms of theindustrial activities covered and may be either split up according to territorial subunits orconducted nationally.
The third bargaining level involves the company and/or establishment. As a supplementarytype of bargaining, it emphasizes the point that bargaining levels need not be mutuallyexclusive.Introduction Of Trade-UnionsA trade union is an organization of employees formed on a continuous basis for the purpose ofsecuring diverse range of benefits. It is a continuous association of wage earners for the purposeof maintaining and improving the conditions of their working lives.The Trade Union Act 1926 defines a trade union as a combination, whether temporary orpermanent, formed primarily for the purpose of regulating the relations between workmen andemployers or between workmen and workmen, or between employers and employers, or forimposing restrictive condition on the conduct of any trade or business, and includes anyfederation of two or more trade unions.This definition is very exhaustive as it includes associations of both the workers and employersand the federations of their associations. Here, the relationships that have been talked about areboth temporary and permanent. This means it applies to temporary workers (or contractualemployees) as well. Then this definition, primarily, talks about three relationships. They are therelationships between the: • workmen and workmen, • workmen and employers, and • employers and employers.Thus, a trade union can be seen as a group of employees in a particular sector, whose aim is tonegotiate with employers over pay, job security, working hours, etc, using the collective powerof its members. In general, a union is there to represent the interests of its members, and mayeven engage in political activity where legislation affects their members. Trade unions arevoluntary associations formed for the pursuit of protecting the common interests of its membersand also promote welfare. They protect the economic, political and social interests of theirmembers.Features of trade unions: 1. It is an association either of employers or employees or of independent workers. They may consist of :-
o Employers’ association (eg., Employer’s Federation of India, Indian paper mill association, etc.) o General labor unions o Friendly societies o Unions of intellectual labor (eg, All India Teachers Association) 2. It is formed on a continuous basis. It is a permanent body and not a casual or temporary one. They persist throughout the year. 3. It is formed to protect and promote all kinds of interests –economic, political and social- of its members. The dominant interest with which a union is concerned is, however, economic. 4. It achieves its objectives through collective action and group effort. Negotiations and collective bargaining are the tools for accomplishing objectives. 5. Trade unions have shown remarkable progress since their inception; moreover, the character of trade unions has also been changing. In spite of only focusing on the economic benefits of workers, the trade unions are also working towards raising the status of labors as a part of industry.Objectives Of Trade UnionsTrade unions are formed to protect and promote the interests of their members. Their primaryfunction is to protect the interests of workers against discrimination and unfair labor practices.Trade unions are formed to achieve the following objectives:T RepresentationTrade unions represent individual workers when they have a problem at work. If an employee
feels he is being unfairly treated, he can ask the union representative to help sort out thedifficulty with the manager or employer. Unions also offer their members legal representation.Normally this is to help people get financial compensation for work-related injuries or to assistpeople who have to take their employer to court. • Negotiation Negotiation is where union representatives, discuss with management, the issues which affect people working in an organization. There may be a difference of opinion between management and union members. Trade unions negotiate with the employers to find out a solution to these differences. Pay, working hours, holidays and changes to working practices are the sorts of issues that are negotiated. In many workplaces there is a formal agreement between the union and the company which states that the union has the right to negotiate with the employer. In these organizations, unions are said to be recognized for collective bargaining purposes. • Voice in decisions affecting workers The economic security of employees is determined not only by the level of wages and duration of their employment, but also by the management’s personal policies which include selection of employees for lay offs, retrenchment, promotion and transfer. These policies directly affect workers. The evaluation criteria for such decisions may not be fair. So, the intervention of unions in such decision making is a way through which workers can have their say in the decision making to safeguard their interests. • Member services During the last few years, trade unions have increased the range of services they offer their members. These include: o Education and training - Most unions run training courses for their members on employment rights, health and safety and other issues. Some unions also help members who have left school with little education by offering courses on basic skills and courses leading to professional qualifications. o Legal assistance - As well as offering legal advice on employment issues, some unions give help with personal matters, like housing, wills and debt.
o Financial discounts - People can get discounts on mortgages, insurance and loans from unions. o Welfare benefits - One of the earliest functions of trade unions was to look after members who hit hard times. Some of the older unions offer financial help to their members when they are sick or unemployed.Functions Of Trade UnionsTrade unions perform a number of functions in order to achieve the objectives. These functionscan be broadly classified into three categories:(i) Militant functions,(ii) Fraternal functionsMilitant Functions One set of activities performed by trade unions leads to the betterment of the position of their members in relation to their employment. The aim of such activities is to ensure adequate wages, secure better conditions of work and employment, get better treatment from employers, etc. When the unions fail to accomplish these aims by the method ofcollective bargaining and negotiations, they adopt an approach and put up a fight with themanagement in the form of go-slow tactics, strike, boycott, gherao, etc. Hence, these functions ofthe trade unions are known as militant or fighting functions. Thus, the militant functions of tradeunions can be summed up as: • To achieve higher wages and better working conditions • To raise the status of workers as a part of industry • To protect labors against victimization and injusticeFraternal FunctionsAnother set of activities performed by trade unions aims at rendering help to its members intimes of need, and improving their efficiency. Trade unions try to foster a spirit of cooperationand promote friendly industrial relations and diffuse education and culture among their members.They take up welfare measures for improving the morale of workers and generate self confidenceamong them. They also arrange for legal assistance to its members, if necessary. Besides, these,they undertake many welfare measures for their members, e.g., school for the education of
children, library, reading-rooms, in-door and out-door games, and other recreational facilities.Some trade unions even undertake publication of some magazine or journal. These activities,which may be called fraternal functions, depend on the availability of funds, which the unionsraise by subscription from members and donations from outsiders, and also on their competentand enlightened leadership. Thus, the fraternal functions of trade unions can be summed up as: • To take up welfare measures for improving the morale of workers • 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 discriminationImportance Of Trade Unions The existence of a strong and recognized trade union is a pre-requisite to industrial peace. Decisions taken through the process of collective bargaining and negotiations between employer and unions are more influential. Trade unions play an important role and are helpful in effective communication between the workers and the management. They provide the advice and support to ensure that the differences of opinion do not turn into major conflicts. The central function of a trade union is to represent people at work. But they also have a wider role in protecting their interests. They also play an important educational role, organizing courses for their members on a wide range of matters. Seeking a healthy and safe working environment is also prominent feature ofunion activity.Trade unions help in accelerated pace of economic development in many ways as follows: • by helping in the recruitment and selection of workers. • by inculcating discipline among the workforce
• by enabling settlement of industrial disputes in a rational manner • by helping social adjustments. Workers have to adjust themselves to the new working conditions, the new rules and policies. Workers coming from different backgrounds may become disorganized, unsatisfied and frustrated. Unions help them in such adjustment.Trade unions are a part of society and as such, have to take into consideration the nationalintegration as well. Some important social responsibilities of trade unions include: • promoting and maintaining national integration by reducing the number of industrial disputes • incorporating a sense of corporate social responsibility in workers • achieving industrial peaceReasons For Joining Trade Unions The important forces that make the employees join a union are as follows: 1. Greater Bargaining Power The individual employee possesses very little bargaining power as compared to that of his employer. If he is not satisfied with the wage and other conditions of employment, he can leave the job. It is not practicable to continually resign from one job after another when he is dissatisfied. This imposes a great financial and emotional burden upon the worker. The better course for him is to join a union that can take concerted action against the employer. The threat or actuality of a strike by a union is a powerful tool that often causes the employer to accept the demands of the workers for better conditions of employment.2. Minimize DiscriminationThe decisions regarding pay, work, transfer, promotion, etc. are highly subjective in nature. Thepersonal relationships existing between the supervisor and each of his subordinates mayinfluence the management. Thus, there are chances of favoritisms and discriminations. A trade
union can compel the management to formulate personnel policies that press for equality oftreatment to the workers. All the labor decisions of the management are under close scrutiny ofthe labor union. This has the effect of minimizing favoritism and discrimination.3. Sense of SecurityThe employees may join the unions because of their belief that it is an effective way to secureadequate protection from various types of hazards and income insecurity such as accident, injury,illness, unemployment, etc. The trade union secure retirement benefits of the workers andcompel the management to invest in welfare services for the benefit of the workers.4. Sense of ParticipationThe employees can participate in management of matters affecting their interests only if they jointrade unions. They can influence the decisions that are taken as a result of collective bargainingbetween the union and the management.5. Sense of BelongingnessMany employees join a union because their co-workers are the members of the union. At times,an employee joins a union under group pressure; if he does not, he often has a very difficult timeat work. On the other hand, those who are members of a union feel that they gain respect in theeyes of their fellow workers. They can also discuss their problem with’ the trade union leaders.6. Platform for self expressionThe desire for self-expression is a fundamental human drive for most people. All of us wish toshare our feelings, ideas and opinions with others. Similarly the workers also want themanagement to listen to them. A trade union provides such a forum where the feelings, ideas andopinions of the workers could be discussed. It can also transmit the feelings, ideas, opinions andcomplaints of the workers to the management. The collective voice of the workers is heard by themanagement and give due consideration while taking policy decisions by the management.7. Betterment of relationshipsAnother reason for employees joining unions is that employees feel that unions can fulfill theimportant need for adequate machinery for proper maintenance of employer-employee relations.Unions help in betterment of industrial relations among management and workers by solving theproblems peacefully.Trade Unionism In IndiaThe trade unionism in India developed quite slowly as compared to the western nations. Indiantrade union movement can be divided into three phases.The first phase (1850 to1900)During this phase the inception of trade unions took place. During this period, the working andliving conditions of the labor were poor and their working hours were long. Capitalists were onlyinterested in their productivity and profitability. In addition, the wages were also low and generaleconomic conditions were poor in industries. In order to regulate the working hours and otherservice conditions of the Indian textile laborers, the Indian Factories Act was enacted in 1881. As
a result, employment of child labor was prohibited.The growth of trade union movement was slow in this phase and later on the Indian Factory Actof 1881 was amended in 1891. Many strikes took place in the two decades following 1880 in allindustrial cities. These strikes taught workers to understand the power of united action eventhough there was no union in real terms. Small associations like Bombay Mill-Hands Associationcame up by this time.The second phase (1900 to 1946)This phase was characterized by the development of organized trade unions and politicalmovements of the working class. Between 1918 and 1923, many unions came into existence inthe country. At Ahmedabad, under the guidance of Mahatma Gandhi, occupational unions likespinners’ unions and weavers’ unions were formed. A strike was launched by these unions underthe leadership of Mahatma Gandhi who turned it into a satyagrah. These unions federated intoindustrial union known as Textile Labor Association in 1920.In 1920, the First National Tradeunion organization (The All India Trade Union Congress (AITUC)) was established. Many of theleaders of this organization were leaders of the national Movement. In 1926, Trade union lawcame up with the efforts of Mr. N N Joshi that became operative from 1927. During 1928, AllIndia Trade Union Federation (AITUF) was formed.The third phase began with the emergence of independent India (in 1947). The partition ofcountry affected the trade union movement particularly Bengal and Punjab. By 1949, four centraltrade union organizations were functioning in the country: 1. The All India Trade Union Congress, 2. The Indian National Trade Union Congress, 3. The Hindu Mazdoor Sangh, and 4. The United Trade Union CongressThe working class movement was also politicized along the lines of political parties. For instanceIndian national trade Union Congress (INTUC) is the trade union arm of the Congress Party. TheAITUC is the trade union arm of the Communist Party of India. Besides workers, white-collaremployees, supervisors and managers are also organized by the trade unions, as for example inthe Banking, Insurance and Petroleum industries.Trade unions in India
The Indian workforce consists of 430 million workers, growing 2% annually. The Indian labormarkets consist of three sectors: 1. The rural workers, who constitute about 60 per cent of the workforce. 2. Organized sector, which employs 8 per cent of workforce, and 3. 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: 1. All India Trade Union Congress (AITUC) 2. Bharatiya Mazdoor Sangh (BMS) 3. Centre of Indian Trade Unions (CITU) 4. Hind Mazdoor Kisan Panchayat (HMKP) 5. Hind Mazdoor Sabha (HMS) 6. Indian Federation of Free Trade Unions (IFFTU) 7. Indian National Trade Union Congress (INTUC)
8. National Front of Indian Trade Unions (NFITU) 9. National Labor Organization (NLO) 10. Trade Unions Co-ordination Centre (TUCC) 11. United Trade Union Congress (UTUC) and 12. United Trade Union Congress - Lenin Sarani (UTUC - LS)FIGURES REGARDING TRADE UNIONSTable Showing Growth Of Trade Unions and Membership is following belowGrowth of trade unions and membershipIndustrial Relation PolicyPrior to 1991, the industrial relations system in India sought to control conflicts and disputes
through excessive labor legislations. These labor laws were protective in nature and covered a wide range of aspects of workplace industrial relations like laws on health and safety of labors, layoffs and retrenchment policies, industrial disputes and the like. The basic purpose of these laws was to protect labors. However, these protectionist policies created an atmosphere that led to increased inefficiency in firms, over employment and inability to introduce efficacy. With the coming of globalization, the 40 year old policy of protectionism proved inadequate for Indian industry to remain competitive as the lack of flexibility posed a serious threat to manufacturersbecause they had to compete in the international market.With the advent of liberalization in1992, the industrial relations policy began to change. Now,the policy was tilted towards employers. Employers opted for workforce reduction, introducedpolicies of voluntary retirement schemes and flexibility in workplace also increased. Thus,globalization brought major changes in industrial relations policy in India. The changes can besummarized as follows: • Collective bargaining in India has mostly been decentralized, but now in sectors where it was not so, are also facing pressures to follow decentralization. • Some industries are cutting employment to a significant extent to cope with the domestic and foreign competition e.g. pharmaceuticals. On the other hand, in other industries where the demand for employment is increasing are experiencing employment growths. • In the expansionary economy there is a clear shortage of managers and skilled labor. • The number of local and enterprise level unions has increased and there is a significant reduction in the influence of the unions. • Under pressure some unions and federations are putting up a united front e.g. banking. • Another trend is that the employers have started to push for internal unions i.e. no outside affiliation. • HR policies and forms of work are emerging that include, especially in multi-national companies, multi-skills, variable compensation, job rotation etc. These new policies are
difficult to implement in place of old practices as the institutional set up still needs to be changed. • HRM is seen as a key component of business strategy. • Training and skill development is also receiving attention in a number of industries, especially banking and information technology.Labor Market Related TermsLabor Market: A labor market is defined as a pool of all potential workers who compete forjobs. It also includes the employers who compete for workers. Labor markets are based on thesupply and demand of labor in a country or a specific location that are able and willing to work.Labor Force: Labor force includes all persons classified either as employed or unemployedduring a specified period of time, usually a day or a week. Labor force can be categorized as self-employed, wage and salary earners, casual workers and unemployed.Casual Workers: Casual workers are those workers who are generally employedby small entrepreneurs on daily or weekly basis on a low wage rate. They are not entitled to anypaid holiday leave or paid sick leaves.Unemployed persons: The persons in the labor market who are without work, that is, withoutpaid employment or self-employment and are currently either available for work or are seekingany work are considered to be unemployed.Labor force participation rate: It is the number of persons in the labor force as a percentage ofthe working-age population. The working-age population is the population above a certainreference age like15 years old and over or 15–64, etc.Employment rate: It is ratio of employed persons to the total labor force. It is the percentage ofworking age people who have jobs or are employed.Unemployment rate: It is the ratio of unemployed people to the total labor force.Underemployed persons: Workers who are employed, but not in the desired capacity, whetherin terms of compensation, hours, or level of skill and experience. The skills of such persons areunderutilized, for example paying low wages to a highly skilled employee. Underemploymentalso refers to a situation where a major portion of labor force is unemployed.
Underemployment rate: It is the ratio of underemployed to either total labor force or totalemployment.Labor Market In IndiaThe Indian labor market can be categorized into three sectors:T Rural workers , who constitute about 60% of the workforceT Organized of the formal sector, that constitutes about 8% of the workforce; andT Urban unorganized or informal structure which represents the 32% of the workforce.The chart below describes the estimated increase in the number of labors from 1977-78 to2004-05. The labor force has grown from 276.3 million to 385.5 million between 1977-78and1993-94 showing an annual growth rate of 2.1%. During the year 1999-2000, the workforcewas estimated to be 407million. In 2004-05 the labor market consisted of 430 million workers and has grown up to 500million in 2006.Two-third of India’s workforce is employed in agriculture and rural industries. One-third of ruralhouseholds are agricultural labor households, subsisting on wage employment. Only about 9percent of the total workforce is in the organized sector; the remaining 91 percent are in theunorganized sector, self-employed, or employed as casual wage laborers. The labor force in year2006 has grown up to 509.3 million out of which 60% are in agriculture, 12% are employed inindustries and the residual 28% are in services.
Labor force can be divided into four categories: self employed workers, wage and salary earners,casual workers and unemployed. Of these, self-employed are most loosely connected to labormarket because of the possibilities of work-sharing and work spreading in a self-employedenterprise. Non-contractual casual laborers have the closest connection to labor market on almostday-to day basis. Same is the case with those unemployed who are actively seeking work.Contractual and hence stable hired employment (with the same employer and/or in the same job)on a regular basis is covered in the description wage and salary workers. Persons who areengaged in their own farm or non- farm enterprises are defined as self employed. The employeesin an enterprise can be either regular salaried/ wage employees or casual wage employees whoare normally engaged on a day today basis. The casual wage workers both in public work andother types of work don’t have any job security or social security. These workers, either informal or informal sector or in private households, are informal workers. The regularsalaried/wage employees are those working in others farm or non- farm enterprises and getting inreturn salary or wages on a regular basis and not on the basis of daily or periodic renewal ofwork contract. This category includes those getting time wage as well as those receiving piecewage or salary and paid apprentices, both full time and part time. This category of persons may,therefore, include persons engaged regularly on an hourly basis, temporary workers, out-workers, etc. The table given below classifies labor force across male-female and rural-urbandimensions. It is clear that • Self-employment and casual labor statuses are more prevalent among rural than urban labor force and among female than male workers. • The Incidence of unemployment is higher in the urban than in the rural labor force with nearly 48 per cent of the total unemployed persons coming from aggregate urban labor force whose share in total (rural plus urban) work force is 22 per cent.
• Those reporting wage and salary earning dominate in the urban labor force, their share being around 62 per cent (lines 10 to 12 of Table).Organized and Unorganized LaborIn India, a major chunk of labor force is employed in the unorganized sector. The unorganized /informal employment consists of causal and contributing family workers; self employed personsin un-organized sector and private households; and other employed in organized and unorganizedenterprises that are not eligible either for paid, sick or annual leave or for any social securitybenefits given by the employer. According to the results of the National Sample Survey conducted in 1999-2000, total work force as on 1.1.2000 was of the order of 406 million. About 7 % of the total work force is employed in the formal or organized sector (all public sector establishments and all non- agriculturalestablishments in private sector with 10 or more workers) while remaining 93% work in theinformal or unorganized sector. The NSS 55th round, 1999-2000 also covered non-agriculturalenterprises in the informal sector in India. As per that survey, there were 44.35 millionenterprises and 79.71 million workers employed thereof in the non-agricultural informal sectorof the economy. Among these 25.01 million enterprises employing 39.74 million workers werein rural areas whereas 19.34 million enterprises with 39.97 million workers in the urban area.Among the workers engaged in the informal sector, 70.21 million are full time and 9.5 millionpart times. Percentage of female workers to the total workers is 20.2 percent.The table below describes major employment trends for the organized and unorganized sector forthe years 1983, 1987-88, 1993-94 and 1999-2000. It is evident that throughout this period a large
portion of the workforce in India is found to be employed in the unorganized sector. Out of397million workers in 1999-2000, it is estimated that 369 million workers (nearly 93 per cent)are employed in the unorganized segment of the economy whereas only 28 million workers (7per cent) are engaged in the organized sector. The share of unorganized employment in theeconomy has displayed remarkable steadiness over the years. The share of informal employmenthas risen from 92 per cent (nearly 276 million out of 300 million) in 1983 to 93 per cent in the1999-2000. It is clear that employment opportunity in the organized sector has remained more orless stagnant, showing only a marginal increase from 24 million in 1983 to 28 million in1999-2000.The largest numbers of informal workers are in agriculture. In fact, 98.84 percent of theemployment in agriculture is informal. In the non-agricultural sector, the highest numbers ofinformal employees are in retail trade, construction, land transport, textiles etc.Thus, the unorganized sector plays a vital role in terms of providing employment opportunity toa large segment of the working force in the country and contributes to the national productsignificantly. The contribution of the unorganized sector to the net domestic product and its sharein the total NDP at current prices has been over 60%. In the matter of savings the share ofhousehold sector in the total gross domestic saving mainly unorganized sector is about threefourth. Thus unorganized sector has a crucial role in our economy in terms of employment andits contribution to the National Domestic Product, savings and capital formation.Employment In IndiaThe organized sector in India consists of 293.77 thousand industrial establishments. Out of these,172.34 thousand are public sector enterprises while 121.43 thousand are in private sector. Since2004, an increase of 1.4% has been recorded in the number of establishments in the organizedsector. As on the 31st March, 2005 the total employment in the organized sector was estimated tobe 264.58 lakh while in 2004, it was 264.43 lakh. This means there has been an increase of 0.1%in employment. The public sector employs about 180.7 lakh persons while the private sectoremploys 84.52 lakh persons. The negative growth of employment was recorded in public sectorwhile private sector showed an increasing trend, that is, the employment in public sector
decreased by 1 percent while private sector increased by 2.5 percent.The branch wise analysis of the public sector data reveals that Central Govt. shows maximumnegative growth in employment followed by Quasi Govt., Local Bodies and State Govt. Thesame trend continued in 2005 also, in which the Central Govt. recorded a negative growth of2.9% followed by Quasi Govt. with a negative growth of 2.2%. The Local Bodies and StateGovt. were also subjected to a negative growth of 0.4% and 0.3% respectively.State wise analysis reflects that only Punjab and Kerala recorded a decrease of more than 3percent. Decrease in employment above 1 percent was observed in Madhya Pradesh UttarPradesh, Chandigarh and Andhra Pradesh. An increase of more than 3 percent in employmentwas observed in Goa, Himachal Pradesh and Gujarat and 1 percent or more in Pondicherry,Karnataka, West Bengal, Uttaranchal, Assam and Nagaland.
While analyzing the figures zone wise, highest decrease of 1.6 percent was seen in Central Zonefollowed by 1 percent in Northern Zone and 0.6 percent in Southern Zone whereas the highestincrease was 2 percent in Western Zone followed by 1.1 percent in North-Eastern Zone and 0.9percent in Eastern Zone in employment.Women Employment You can tell the condition of a nation by looking at the status of its women. - Jawaharlal Nehru Women workforce constitutes an integral part of total workforce in India. On 31st march 2004, women constituted 19 per cent of the total workforce. The participation of women in the labor force has always been lower than that of men, in the rural as well as urban areas. The work participation rate for women has increased significantly. In 1981, work participation rate for women was only 19.67 per cent which increased up to 22.73 per cent in 1991 and 26.68 per cent in 2001. In the women workforce, women from rural areas are greater in number as compared to theurban women. Amongst rural women workers, a majority is employed in agriculture and someare employed in cottage industries. In the urban areas, women workers are primarily employed inthe unorganized sectors. As on the 31st March, 2005 a total number of 50.16 Lacs womenemployees were engaged in the organized sector, out of which 29.21 lacs (58per cent) in thepublic sector and 20.95 lacs (42per cent) in the Private Sector. Employment of women in publicsector increased by 1.1 percent and by 2.5 percent in the private sector during 2004-2005. Thezone wise analysis showed an increase of 8 percent in North-Eastern Zone, followed by WesternZone (5.3per cent), Eastern Zone (3per cent) and Central Zone (1.3per cent) and Northern Zone(1.2per cent). Only Southern Zone registered a marginal dip of 0.8 percent.
Some Vital Statistics • The number of women job seekers has increased from 99.3 lacs in 1999 to 106.1 lacs in 2004. Thus the percentage of women job seekers to the total job-seekers has also increased from 24.6per cent in 1999 to 26.2per cent in 2004. Table 1: Number of Women Job Seekers Year Number of Women (in lacs) Percentage to total 1999 99.3 24.6 2000 104.5 25.3 2001 108.8 25.9 2002 106.0 25.9 2003 107.5 26.0 2004 106.1 26.0 • Number of Educated Women Job Seekers as on December 2004 was 7537.7 thousand. Educated Women at the end of 2004 accounted for 25.8per cent of the total educated job- seekers. Table 2: Number of Educated Women Job Seekers Year Number of Women Percentage to total 2000 7911.7 27.1 2001 8525.6 28.1 2002 7921.4 26.8
2003 8032.4 26.6 2004 7537.7 25.8 • The state wise analysis reflects that Kerala has the maximum (21.1 lacs) women job- seekers followed by West Bengal (19.3 lacs) and Tamil Nadu (15.3 lacs) while minimum number of women job-seekers are in Rajasthan (1.0 lacs). • The percentage of educated women job seekers among the total women job seekers has gone down from 73.3per cent to 70.4per cent in 2004. • The work participation rate for women was 25.68 per cent in 2001. This shows an improvement over 22.73 per cent in 1991 and 19.67 per cent in 1981. • Women workers constituted 19 per cent of the total organized sector employment in the country, as compared to 18.4 per cent in the previous year. As on 31st March, 2004, there were about 49.34 lacs women workers employed in the organized sector (Public and Private Sector). • As far as industries are concerned, in 2005, the manufacturing industry faced a dip of 1.1per cent in women employment. On the other hand, other industries reflected an increase in women employment. An increase of 7.8 per cent was registered in Wholesale and Retail Trade followed by 5.6 per cent in Mining and Quarrying, 5.5 per cent in Agriculture, Hunting, Forestry & Fishing, 5.2 per cent in Financing, Insurance Real Estate & Business Services, 1.7 per cent in Electricity, Gas & Water, 1.5 per cent in Construction, 1.4 per cent in Community, Social and Personal Services and 1.2 per cent in Transport, Storage & Communications.Employee DisciplineThe maintenance of harmonious industrial relations within an industry depends on the extent ofpromotion and maintenance of discipline in the organizations. No organizations can grow andprosper without effective disciplinary system. Discipline on account of employees meanscomplying with the predefined rules and regulations of the organization. It is a form of trainingthat enforces organizational rules. Conduct problems arise from the employees who fail to followthe code of conduct of the organization. These employees are most often affected by thedisciplinary system of the organization. Such employees are often called problem employees.
The problem employees comprise a small number of employees, but they are the ones who cause the most disciplinary situations.If employers fail to deal with problem employees, negative effects on other employees and workgroups may result. Some common disciplinary issues caused by problem employees includeabsenteeism, tardiness, productivity deficiencies, pilfering, alcoholism, insubordination, misuseof equipments and other company resources, and negligence. The goal of discipline is behaviormodification, that is, to modify unacceptable behavior and misconduct. The Disciplinary SystemEffective DisciplineDiscipline is the key to success. Theodore Roosevelt has said “With self-discipline almosteverything is possible”. Self discipline makes employee realize what is required at work.Discipline can be positively related to performance. It is the bridge between goals andaccomplishments. Effective discipline should be aimed at the behavior, and not at the employeepersonality. This is because the reason for discipline is to improve performance rather thanpunishing the employee.Factors necessary for effective disciplinary system include: 1. Training of supervisors is necessary: Supervisors and mangers need to be trained on when and how discipline should be used. It is necessary to provide training on counseling skills as these skills are used while dealing with problem employees. Moreover, discipline decisions taken by trained supervisors are considered fair by both employees and managers.
2. Centralization of discipline: Centralized means that the discipline decisions should be uniform throughout the organization. The greater the uniformity, higher will be the effectiveness of discipline procedure.3. Impersonal discipline: Discipline should be handled impersonally. Managers should try to minimize the ill feelings arising out of the decisions by judging the offensive behavior and not by judging the person. Managers should limit their emotional involvement in the disciplinary sessions.4. Review discipline decisions: The disciplinary decisions must be reviewed before being implemented. This will ensure uniformity and fairness of the system and will minimize the arbitrariness of the disciplinary system.5. Notification of conduct that may result in discipline: Actions that lead to misconduct can be listed and documented so the employees are aware of such actions. This will unable them to claim that they have not been notified, in advance, regarding the same.6. Information regarding penalties: The employer should define the penalties and other actions like warnings, reprimands, discharge and dismissal well in advance. All these action plans must be communicated to the employees.7. Discipline shall be progressive: Discipline system should be progressive in nature. In a progressive discipline approach the severity of actions to modify behavior increases with every step as the employee continues to show improper behavior. The advantage of this approach is that employees can’t take it for granted.8. Documentation: Effective discipline requires accurate, written record keeping and written notification to the employees. Thus less chance will be left for the employee to say the he “did not know” about the policy.
9. Discipline should be fair: The disciplinary decision should be fair enough for the employee. Both over-penalization and under-penalization are considered to be unfair for the problem employee. Moreover, an internal fairness is to be maintained, that is, two employees who have committed the same offense should be equally punished. 10. Discipline shall be flexible and consistent: The manager administering discipline must consider the effect of actions taken by other managers and of other actions taken in the past. Consistent discipline helps to set limits and informs people about what they can and cannot do. Inconsistent discipline leads to confusion and uncertainty. 11. Disciplinary action should be prompt: The effective discipline should be immediate. The longer time lag between the misconduct offense and the disciplinary action will result in ineffectiveness of the discipline.Approaches to Discipline Handling employee misconduct is a very critical task to be performed by the seniormanagers. Misconduct and other offensive behaviors often lead to decreased levels ofproductivity as they affect the individual performance of the employees. To managediscipline among employees, every company opts for a discipline policy which describes theapproach it will follow to handle misconduct.Broadly defined, there are two approaches to discipline employees. They are: * Positive Discipline Approach * Progressive Discipline ApproachPositive Discipline Approach
This approach is based on the premise that role of a discipline approach should not always be topunish; rather, it should try to regulate the negative behavior of employees to make them betterworkers. Positive discipline is a corrective action which results in improved performance, moreproductivity and effective workforce. Harsh and negative punishment might work in the shortterm, but the end result will eventually be employee dissatisfaction, low productivity, higher rateof absenteeism and high turnover. This approach tries to mend the negative behavior ofemployees by first providing them counseling in terms of what is expected out of them and thengiving oral and written warnings to them. Termination or discharge in extreme cases may alsotake place.Steps of positive discipline approach 1. Counseling: Counseling is an important part of the discipline process, because it gives a supervisor the opportunity to identify employee work behavior problems and discuss possible solutions with him. The goal of this phase is to make employee aware of organizational policies and rules. Counseling by a supervisor in the work unit can have positive effects also. Often, employees simply need to be made aware of rules. An oral warning can also be given to employee during counseling. Confrontation helps to understand the employee point of view as well. However, proper training should be given to the supervisors regarding counseling skills to make this process successful. 2. Written warning: If employee behavior has not been improved by counseling sessions, then a second conference is held between the supervisor and the employee. This stage is documented in written form. As part of this phase, the employee and the supervisor develop written solutions to prevent further problems from occurring. 3. Final warning: When the employee does not follow the written solutions, a final warning conference is held. In that conference the supervisor emphasizes to the employee the importance of correcting the inappropriate actions. Some firms incorporate a decision-day off, in which the employee is given a day off with pay to develop a firm, written action plan to remedy the problem behaviors. The idea is to impress on the offender the seriousness of the problem and the manager’s determination to see that the behavior is changed. 4. Discharge: If the employee fails to follow the action plan that was developed and further problem behaviors exist, then the supervisor will discharge the employee.The positive aspect of this approach is that it focuses on problem solving rather than punishingand penalizing. This approach involves positive confrontation with the problem employee andthus gives him an opportunity to justify himself. The supervisor makes him aware of the
company policies. The greatest difficulty with this is the extensive amount of training requiredfor supervisors and managers to become effective counselors. Also, the process often takes moresupervisory time than the progressive discipline approach.Progressive Discipline ApproachIt is a step by step program designed to correct performance problems arising out of employeemisconduct. This approach typically follows four progressive steps to rectify offenses committedby an employee. It suggests that actions to modify behavior become progressively more severeas the employee continues to show improper behavior. 1. Oral reprimands: It is a verbal interaction between the employees and supervisor where they discuss the problem behavior and the expectations to change the behaviors. An oral warning is issued as an infor¬mal reprimand that is simply noted in the record. 2. Written reprimand: It involves the documentation between employees and supervisor if the behavior continues or if the employee further commits a serious offense. A written warning is more official and summarizes the previous oral attempts. This written feedback is discussed with the employee and then placed in his personnel file. 3. Suspension: The third step is suspension with¬out pay; its purpose is to emphasize the seriousness of the offense and necessity of change. 4. Dismissal: The final step is dismissal of employee and is used only when previous steps have failed to change unacceptable behavior.
The progressive discipline model has two advantages for managers: • It gives the employee additional opportunities to correct his per¬formance prior to discharge. • It stresses the serious¬ness of repeated violations to employees.This progressive discipline has the following disadvantages: • Progressive discipline may result into bitter relationships between supervisor and employee. • Supervisor may feel obligated to address every perform¬ance offence and assign an appropriate punishment to it, even though it may not be required. • Management may focus only on the problem employees at the expense of the good performers, thereby consuming too much of a managers time.Code Of Discipline In Industry
To maintain harmonious relations and promote industrial peace, a Code of Discipline has been laid downwhich applies to both public and private sector enterprises. It specifies various obligations for themanagement and the workers with the objective of promoting cooperation between theirrepresentatives.The basic objectives of Code of Discipline are to:T Maintain peace and order in industry.T Promote constructive criticism at all levels of management and employment.T Avoid work stoppage in industryT Secure the settlement of disputes and grievances by a mutually agreed procedureT Avoiding litigationsT Facilitate a free growth of trade unionsT Eliminate all forms of coercion, intimidation and violations of rules and regulations governingindustrial relations.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 variousactions. These actions can b summarized as follows: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
Management Agrees • not to increase work-loads unless agreed upon or settled otherwise • not to support or encourage any unfair labor 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 indisciplineUnion 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 labor practices such as negligence of duty, damage to property and insubordination • to take prompt action to implement awards, agreements, settlements and decisionsFactors Guiding Code Of ConductThe code of discipline and conduct communicates to the employees, the expected behavior andthe professional responsibilities. The significance of code of conduct is that each employee
should behave and perform in a way that preserves the company values and commitments. Thecode expects employees to conduct business with integrity and honesty. Moreover, it expects theemployer to be an equal opportunity employer.The Code of Conduct policy of a company is determined on the basis of following factors: 1. Honesty and integrity: The organization expects the employees to observe honesty and integrity and suchconduct should be fair and transparent. The employees should show truthfulness in actionsthroughout their tenure in the organization. 2. Disclosure of information: The employees should not disclose the company information to third parties and other outside organizations. However the employers should reveal the various policies of the organization to their employees and make them aware about the code of conduct and other policies. 3. Harassment: The work environment should be free from all kinds of harassments, especially sexual harassments and verbal harassments. No physical harassments like hitting or pushing are acceptable on part of employees. 4. Outside employment: Employees should not indulge in to any kind of concurrent employment without the prior knowledge of employer. 5. Conflict of interest: An employee should not indulge into other professions or services or other interests which might conflict with the interest of the company. This means personal interests should not overshadow organizational interests. 6. Confidentiality: Employees should protect company’s confidential information. The financial records and unpublished data should be kept within the organizations and should not be spread outside the organization. 7. Equal opportunity employer: This factor expects the employer to be an equal opportunity, that is, no discrimination should be done on the basis of caste, color, race, gender, religion or physical disabilities.
8. Misusing company resources: Employees should not misuse company resources, intellectual property, time and other facilities. They are provided to them for business purposes and thus, should be used in a cost effective way. 9. Health and safety: An employer should provide a safe and healthy work environment to its employees. Proper cleanliness and lightening should be provided. A health and safety committee can be set up by the employer consisting of representatives of workers as well. 10. Payment and gifts: The employees should neither accept nor offer any kind of illegal payments, donations, remuneration and gifts from outsidersGrievance In IndustryGrievance means any type of dissatisfaction or discontentments arising out of factors related toan employee’s job which he thinks are unfair. A grievance arises when an employee feels thatsomething has happened or is happening to him which he thinks is unfair, unjust or inequitable.In an organization, a grievance may arise due to several factors such as:I Violation of management’s responsibility such as poor working conditionsI Violation of company’s rules and regulationsI Violation of labor lawsI Violation of natural rules of justice such as unfair treatment in promotion, etc.Various sources of grievance may be categorized under three heads: (i) management policies, (ii)working conditions, and (iii) personal factors 1. Grievance resulting from management policies include: o Wage rates o Leave policy o Overtime
o Lack of career planning o Role conflicts o Lack of regard for collective agreement o Disparity between skill of worker and job responsibility2. Grievance resulting from working conditions include: o Poor safety and bad physical conditions o Unavailability of tools and proper machinery o Negative approach to discipline o Unrealistic targets3. Grievance resulting from inter-personal factors include o Poor relationships with team members o Autocratic leadership style of superiors o Poor relations with seniors
o Conflicts with peers and colleaguesIt is necessary to distinguish a complaint from grievance. A complaint is an indication ofemployee dissatisfaction that has not been submitted in written. On the other hand, a grievance isa complaint that has been put in writing and made formal.Grievances are symptoms of conflicts in industry. Therefore, management should be concernedwith both complaints and grievances, because both may be important indicators of potentialproblems within the workforce. Without a grievance procedure, management may be unable torespond to employee concerns since managers are unaware of them. Therefore, a formalgrievance procedure is a valuable communication tool for the organization.Grievance ProcedureGrievance procedure is a formal communication between an employee and the managementdesigned for the settlement of a grievance. The grievance procedures differ from organization toorganization.1. Open door policy2. Step-ladder policyOpen door policy: Under this policy, the aggrieved employee is free to meet the top executivesof the organization and get his grievances redressed. Such a policy works well only in smallorganizations. However, in bigger organizations, top management executives are usually busywith other concerned matters of the company. Moreover, it is believed that open doorpolicy is suitable for executives; operational employees may feel shy to go to top management.Step ladder policy: Under this policy, the aggrieved employee has to follow a step by stepprocedure for getting his grievance redressed. In this procedure, whenever an employee isconfronted with a grievance, he presents his problem to his immediate supervisor. If theemployee is not satisfied with superior’s decision, then he discusses his grievance with thedepartmental head. The departmental head discusses the problem with joint grievancecommittees to find a solution. However, if the committee also fails to redress the grievance, thenit may be referred to chief executive. If the chief executive also fails to redress the grievance,then such a grievance is referred to voluntary arbitration where the award of arbitrator is bindingon both the parties.GRIEVANCE PROCEDURE IN INDIAN INDUSTRYThe 15th session of Indian Labor Conference held in 1957 emphasized the need of an establishedgrievance procedure for the country which would be acceptable to unions as well as tomanagement. In the 16th session of Indian Labor Conference, a model for grievance procedurewas drawn up. This model helps in creation of grievance machinery. According to it, workers’
representatives are to be elected for a department or their union is to nominate them.Management has to specify the persons in each department who are to be approached first andthe departmental heads who are supposed to be approached in the second step. The ModelGrievance Procedure specifies the details of all the steps that are to be followed while redressinggrievances. These steps are:STEP 1: In the first step the grievance is to be submitted to departmental representative, who is arepresentative of management. He has to give his answer within 48 hours.STEP 2: If the departmental representative fails to provide a solution, the aggrieved employeecan take his grievance to head of the department, who has to give his decision within 3 days.STEP 3: If the aggrieved employee is not satisfied with the decision of departmental head, hecan take the grievance to Grievance Committee. The Grievance Committee makes itsrecommendations to the manager within 7 days in the form of a report. The final decision of themanagement on the report of Grievance Committee must be communicated to the aggrievedemployee within three days of the receipt of report. An appeal for revision of final decision canbe made by the worker if he is not satisfied with it. The management must communicate itsdecision to the worker within 7 days.STEP 4: If the grievance still remains unsettled, the case may be referred to voluntaryarbitration.
Employee Health and SafetyFor smooth functioning of an organization, the employer has to ensure safety and security of hisemployees. Health and safety form an integral part of work environment. A work environmentshould enhance the well being of employees and thus should be accident free. The terms health, safety and security are closely related to each other. Health is the general state of well being. It not only includes physical well being, but also emotional and mental well being. Safety refers to the act of protecting the physical well being of an employee. It will include the risk of accidents caused due to machinery, fire or diseases. Security refers to protecting facilities and equipments from unauthorized access and protectingemployees while they are on work.In organizations the responsibility of employee health and safety falls on the supervisors or HRmanager. An HR manager can help in coordinating safety programs, making employees awareabout the health and safety policy of the company, conduct formal safety training, etc. Thesupervisors and departmental heads are responsible for maintaining safe working conditions.Responsibilities of managers:
• Monitor health and safety of employees • Coach employees to be safety conscious • Investigate accidents • Communicate about safety policy to employeesResponsibilities of supervisors/departmental heads: • Provide technical training regarding prevention of accidents • Coordinate health and safety programs • Train employees on handling facilities an equipments • Develop safety reporting systems • Maintaining safe working conditionsLegislations governing Occupational Health & safety in India* Factories act1948* Mines act 1952* Dock workers act(Safety, Health & Welfare)1986Factories Act(1948), Mines Act(1952) & Dock Workers Act(1986)There are three major legislations relating to occupational health and safety in India. They arerelated to the health and safety of persons employed in factories, mines and ports.The Factories Act, 1948
• It provides the following provisions for maintaining health, security and safety of employees: For Health Ventilation & Temperature Disposal of wastes Cleanliness Dust and fumes Artificial Humidification Overcrowding Lightening Drinking water Latrines and urinals Spittoons For Safety Fencing of machinery Work on machinery in motion Cashing of new machines Protection of eyes Hoists and lifts Self acting machinery Excessive weights Pressure plant Precautions against dangerous fumes Floors, stairs and means of access Precautions in case of fire Explosives of inflammable gas Safety of buildings & machinery Maintenance of buildings For Welfare Washing facilities Facilities for sitting First aid appliances Canteens Rest rooms and shelters Crèches Facilities for storing and drying clothingMines Act, 1952 • It contains provisions for measures relating to the health, safety and welfare of persons employed in the coal and oil mines. • It provides the following provisions for health and safety of mine workers: Drinking water Conservancy Medical appliances Working hours
Notice about accidents Notice of certain diseasesDock Workers (Safety, Health & Welfare) Act, 1986 • It contains provisions for the health, safety and welfare of workers working in ports/docks. • It provides the following provisions: Surfaces Fencing of dangerous places Passages to be kept clear Railings and fencings Staging construction and maintenance Work on staging Lifesaving appliances Illumination Fire protection Excessive noise Access between deck and hold Stairs Floor loading Construction Access between deck and vessel Access between shore and shipIssues in Employee Health & SafetyOrganizations frame many approaches to ensure health and safety of their employees. But not allof the approaches focus on contribution of both work design and employee behavior to safety.An organizational approach to safety is effective only when both the work design and employeebehavior work in coordination towards it. Many organizational and individual issues emerge inmanagement of employee health and safety. They can be summarized as follows: 1. Physical Work Settings: The physical settings of work affect the performance of employees to a great extent. Some of these factors include temperature, noise levels, and proper lighting affect jobperformance. Other work setting factors include size of work area, kinds of materials used,distance between work areas, cubicle arrangement, et al. 2. Sick Building Syndrome: It is a situation in which employees experience acute health problems and discomfort due to the time spent in a building (particularly their workplace). Some factors that lead to sick buildings include poor air quality, inadequate ventilation, improper cleanliness, rodents, stench of adhesives and glues, et al.
3. Ergonomics: The term comes from the Greek word ergon, which means “work,” and omics which means “management of.” Ergonomics is the study of physiological, psychological, and engineering design aspects of a job, including such factors as fatigue, lighting, tools, equipment layout, and placement of controls. It is the interface between men and machines. Ergonomics is taken into consideration when designing the workstation for computer operators. Problems of back ache, eye strain and headache arise due to long working hours spent in front of computers. 4. Engineering of Work Equipments and Materials: Accidents can be prevented in a way by proper placements of dangerous machines. Moreover design of such machines and equipments also plays an important role in safety. Providing safety guards and covers on equipments, emergency stop buttons and other provisions help in reducing the accidents considerably. 5. Cumulative Trauma and Repetitive Stress: Cumulative trauma disorder occurs when same muscles are used repetitively to perform some task. This results in injuries of musculoskeletal and nervous system. Employees encounter high levels of mental and physical stress also. 6. Accident Rates and Individuals: An individual approach to safe environment helps in reducing the accident rates. This is generally because more problems are caused by careless employees than by machines or employer negligence. A positive attitude towards work environment and other practices promotes employee safety.Occupational Health & Safety Management SystemThe Bureau of Indian Standards has formulated a standard for Occupational health and safetymanagement systems. This standard is known as IS 18001:2000 Occupational Health and SafetyManagement System. Any OHS management system adopted by an organization shouldincorporate all the requirements specified in this standard.Organizations willing to adopt OH&S Management System have to obtain a license for the same.For this purpose, they have to ensure that they are operating according to the IS 18001:2000standard. The organization has to apply at the nearest Regional Office of Bureau of IndianStandards in the prescribed proforma along with a questionnaire and application fee.The application has to be signed by the Chief Executive Officer of the organization or any personwho has been assigned by the CEO for this purpose. Also, manual or the documentation of OHSmanagement system is to be submitted along with the application.
Once an application is received by the regional office of BIS, it is scrutinized for all therequirements. If the application is complete, it is accepted, otherwise more information is soughtfrom the applicant organization. If the application is accepted, an adequacy audit takes place anda preliminary visit (pre-audit) is conducted by an audit team. Immediately after this, initialcertification audit takes place on the basis of which an audit report is prepared by the audit team.If the report comes out to be satisfactory, recommendations for the award of certifications aremade by the team and the certificate is granted to the organization by the concerned authorities.However if the report does not meet all the requirements, the applicant organization is asked totake corrective actions after which another audit is conducted.
Process of OH&S Management System certification * Source: Bureau of Indian Standards (http://www.bis.org.in/)Employee WelfareWelfare includes anything that is done for the comfort and improvement of employees and isprovided over and above the wages. Welfare helps in keeping the morale and motivation of theemployees high so as to retain the employees for longer duration. The welfare measures need not
be in monetary terms only but in any kind/forms. Employee welfare includes monitoring ofworking conditions, creation of industrial harmony through infrastructure for health, industrialrelations and insurance against disease, accident and unemployment for the workers and theirfamilies.Labor welfare entails all those activities of employer which are directed towards providing theemployees with certain facilities and services in addition to wages or salaries.Labor welfare has the following objectives: 1. To provide better life and health to the workers 2. To make the workers happy and satisfied 3. To relieve workers from industrial fatigue and to improve intellectual, cultural and material conditions of living of the workers.The basic features of labor welfare measures are as follows: 1. Labor welfare includes various facilities, services and amenities provided to workers for improving their health, efficiency, economic betterment and social status. 2. Welfare measures are in addition to regular wages and other economic benefits available to workers due to legal provisions and collective bargaining 3. Labor welfare schemes are flexible and ever-changing. New welfare measures are added to the existing ones from time to time. 4. Welfare measures may be introduced by the employers, government, employees or by any social or charitable agency. 5. The purpose of labor welfare is to bring about the development of the whole personality of the workers to make a better workforce.
The very logic behind providing welfare schemes is to create efficient, healthy, loyal andsatisfied labor force for the organization. The purpose of providing such facilities is to make theirwork life better and also to raise their standard of living. The important benefits of welfaremeasures can be summarized as follows: • They provide better physical and mental health to workers and thus promote a healthy work environment • Facilities like housing schemes, medical benefits, and education and recreation facilities for workers’ families help in raising their standards of living. This makes workers to pay more attention towards work and thus increases their productivity. • Employers get stable labor force by providing welfare facilities. Workers take active interest in their jobs and work with a feeling of involvement and participation. • Employee welfare measures increase the productivity of organization and promote healthy industrial relations thereby maintaining industrial peace. • The social evils prevalent among the labors such as substance abuse, etc are reduced to a greater extent by the welfare policies.Labor Welfare Fund Labor welfare refers to all the facilities provided to labor in order to improve their working conditions, provide social security and raise their standard of living. Majority of labor force in India is working in unorganized sector. In order to provide social security to such workers, Government has introduced Labor Welfare Fund to ensure assistance to unorganized labors. Five different welfare funds, which are governed by different legislations, are administered by Ministry of Labor. The purpose of these welfare funds is to provide housing, medical care, educational and recreational facilities to workers employed in beedi industry and non-coal mines and cine workers.The five legislations governing welfare funds are as follows:
• The Mica Mines Labor Welfare Fund Act, 1946 • The Limestone and Dolomite Mines Labor Welfare Fund Act, 1972 • The Iron Ore, Manganese Ore and Chrome Ore Mines Labor Welfare Fund Act, 1976 • The Cine Workers’ Welfare Fund Act, 1981Schemes under welfare funds provide assistance with respective to the following: • Public health and sanitation • Housing • Recreational (including standard of living) • Social security • Educational facilities • Water supply • Transportation • Medical facilities (prevention of diseases)
• Social security o Group Insurance Schemes for Beedi and Cine workers o Social Security under Mine Workers Welfare Fund • Family welfareThe welfare funds are raised by government by imposing cess on manufactured beedis, featurefilms, export of mica, consumption of limestone & dolomite and consumption and export of ironore, manganese ore & chrome ore. An explanation of the cess levied under different legislationsis given below: • Beedi Workers Welfare Cess Act, 1976 provides for levy of cess by way of excise duty on manufactured beedis from Re.1/- to Rs.5/- per thousand manufactured beedis. This is presently Rs 2 per 1000 beedis with effect from 28th June 2000. • The Cine Workers Welfare Cess Act, 1981 provides for duty of cess, at such rate not being less than one thousand rupees and not exceeding twenty thousand rupees, on every feature film submitted to the Chairman, Central Board of Film Certification. This is Rs 20000 per feature film of Hindi and English and for regional films it is Rs 10000 per film with effect from 20th April 2000. • The Iron Ore, Manganese Ore & Chrome Ore Mines Labor Welfare Cess Act, 1976 provides for levy and collection of cess on Iron Ore, Manganese Ore & Chrome Ore between 50p to Re.1/-, Re.1/- to Rs.6/- and Rs.3/- to Rs.6/- respectively. • The Limestone and Mines Labor Welfare Fund Act, 1972 provides for the levy and collection of cess on Limestone and Dolomite as a duty of excise at such rate not exceeding one rupee per metric tone of limestone & dolomite. The rate of cess on Limestone and Dolomite is Re.1/- with effect from 27th December 2000.
• Mica Mines Labor Welfare Fund Act, 1946, provides for levy and collection of cess on all mica exported as duty of Customs not exceeding 6.25% ad valorem. This is 4.5% ad valorem on export with effect from 1st November 1990.Employee Welfare SchemesOrganizations provide welfare facilities to their employees to keep their motivation levels high.The employee welfare schemes can be classified into two categories viz. statutory and non-statutory welfare schemes. The statutory schemes are those schemes that are compulsory toprovide by an organization as compliance to the laws governing employee health and safety.These include provisions provided in industrial acts like Factories Act 1948, Dock Workers Act(safety, health and welfare) 1986, Mines Act 1962. The non statutory schemes differ fromorganization to organization and from industry to industry.STATUTORY WELFARE SCHEMESThe statutory welfare schemes include the following provisions: 1. Drinking Water: At all the working places safe hygienic drinking water should be provided. 2. Facilities for sitting: In every organization, especially factories, suitable seating arrangements are to be provided. 3. First aid appliances: First aid appliances are to be provided and should be readily assessable so that in case of any minor accident initial medication can be provided to the needed employee. 4. Latrines and Urinals: A sufficient number of latrines and urinals are to be provided in the office and factory premises and are also to be maintained in a neat and clean condition. 5. Canteen facilities: Cafeteria or canteens are to be provided by the employer so as to provide hygienic and nutritious food to the employees.
6. Spittoons: In every work place, such as ware houses, store places, in the dock area and office premises spittoons are to be provided in convenient places and same are to be maintained in a hygienic condition. 7. Lighting: Proper and sufficient lights are to be provided for employees so that they can work safely during the night shifts. 8. Washing places: Adequate washing places such as bathrooms, wash basins with tap and tap on the stand pipe are provided in the port area in the vicinity of the work places. 9. Changing rooms: Adequate changing rooms are to be provided for workers to change their cloth in the factory area and office premises. Adequate lockers are also provided to the workers to keep their clothes and belongings. 10. Rest rooms: Adequate numbers of restrooms are provided to the workers with provisions of water supply, wash basins, toilets, bathrooms, etc.NON STATUTORY SCHEMESMany non statutory welfare schemes may include the following schemes: 1. Personal Health Care (Regular medical check-ups): Some of the companies provide the facility for extensive health check-up 2. Flexi-time: The main objective of the flextime policy is to provide opportunity to employees to work with flexible working schedules. Flexible work schedules are initiated by employees and approved by management to meet business commitments while supporting employee personal life needs 3. Employee Assistance Programs: Various assistant programs are arranged like external counseling service so that employees or members of their immediate family can get counseling on various matters.
4. Harassment Policy: To protect an employee from harassments of any kind, guidelines are provided for proper action and also for protecting the aggrieved employee. 5. Maternity & Adoption Leave – Employees can avail maternity or adoption leaves. Paternity leave policies have also been introduced by various companies. 6. Medi-claim Insurance Scheme: This insurance scheme provides adequate insurance coverage of employees for expenses related to hospitalization due to illness, disease or injury or pregnancy. 7. Employee Referral Scheme: In several companies employee referral scheme is implemented to encourage employees to refer friends and relatives for employment in the organization.Industrial DisputesAn industrial dispute may be defined as a conflict or difference of opinion between managementand workers on the terms of employment. It is a disagreement between an employer andemployees representative; usually a trade union, over pay and other working conditions and canresult in industrial actions. When an industrial dispute occurs, both the parties, that is themanagement and the workmen, try to pressurize each other. The management may resort tolockouts while the workers may resort to strikes, picketing or gheraos.As per Section 2(k) of Industrial Disputes Act,1947, an industrial dispute in defined as anydispute or difference between employers and employers, or betweenemployers and workmen, or between workmen and which is connected with the employment ornon-employment or the terms of employment or with the conditions of labor, of any person.This definition includes all the aspects of a dispute. It, not only includes the disagreementbetween employees and employers, but also emphasizes the difference of opinion betweenworker and worker. The disputes generally arise on account of poor wage structure or poorworking conditions. This disagreement or difference could be on any matter concerning theworkers individually or collectively. It must be connected with employment or non-employmentor with the conditions of labor.From the point of view of the employer, an industrial dispute resulting in stoppage of workmeans a stoppage of production. This results in increase in the average cost of production sincefixed expenses continue to be incurred. It also leads to a fall in sales and the rate of turnover,leading to a fall in profits. The employer may also be liable to compensate his customers with
whom he may have contracted for regular supply. Apart from the immediate economic effects,loss of prestige and credit, alienation of the labor force, and other non-economic, psychologicaland social consequences may also arise. Loss due to destruction of property, personal injury andphysical intimidation or inconvenience also arises.For the employee, an industrial dispute entails loss of income. The regular income by way ofwages and allowance ceases, and great hardship may be caused to the worker and his family.Employees also suffer from personal injury if they indulge into strikes n picketing; and thepsychological and physical consequences of forced idleness. The threat of loss of employment incase of failure to settle the dispute advantageously, or the threat of reprisal action by employersalso exists.Prolonged stoppages of work have also an adverse effect on the national productivity, nationalincome. They cause wastage of national resources. Hatred may be generated resulting in politicalunrest and disrupting amicable social/industrial relations or community attitudes.Causes Of Industrial DisputesThe causes of industrial disputes can be broadly classified into two categories: economic andnon-economic causes. The economic causes will include issues relating to compensation likewages, bonus, allowances, and conditions for work, working hours, leave and holidays withoutpay, unjust layoffs and retrenchments. The non economic factors will include victimization ofworkers, ill treatment by staff members, sympathetic strikes, political factors, indiscipline etc. w Wages and allowances: Since the cost of living index is increasing, workers generally bargain for higher wages to meet the rising cost of living index and to increase their standards of living. In 2002, 21.4% of disputes were caused by demandof higher wages and allowances. This percentage was 20.4% during 2003 and during 2004increased up to 26.2%. In 2005, wages and allowances accounted for 21.8% of disputes.i Personnel and retrenchment: The personnel and retrenchment have also been an importantfactor which accounted for disputes. During the year 2002, disputes caused by personnel were14.1% while those caused by retrenchment and layoffs were 2.2% and 0.4% respectively. In2003, a similar trend could be seen, wherein 11.2% of the disputes were caused by personnel,while 2.4% and 0.6% of disputes were caused by retrenchment and layoffs. In year 2005, only9.6% of the disputes were caused by personnel, and only 0.4% were caused by retrenchment.9 Indiscipline and violence: From the given table, it is evident that the number of disputescaused by indiscipline has shown an increasing trend. In 2002, 29.9% of disputes were causedbecause of indiscipline, which rose up to 36.9% in 2003. Similarly in 2004 and 2005, 40.4% and41.6% of disputes were caused due to indiscipline respectively. During the year 2003,indiscipline accounted for the highest percentage (36.9%) of the total time-loss of all disputes,followed by cause-groups wage and allowance and personnel with 20.4% and11.2% respectively.A similar trend was observed in 2004 where indiscipline accounted for 40.4% of disputes.
Bonus: Bonus has always been an important factor in industrial disputes. 6.7% of the disputeswere because of bonus in 2002 and 2003 as compared to 3.5% and 3.6% in 2004 and 2005respectively.r Leave and working hours: Leaves and working hours have not been so important causes ofindustrial disputes. During 2002, 0.5% of the disputes were because of leave and hours of workwhile this percentage increased to 1% in 2003. During 2004, only 0.4% of the disputes werebecause of leaves and working hours.b Miscellaneous: The miscellaneous factors include - Inter/Intra Union Rivalry - Charter of Demands - Work Load - Standing orders/rules/service conditions/safety measures - Non-implementation of agreements and awards etc.Analysis Of Industrial DisputesThe number of industrial disputes in country has shown slow but steady fall over the past ten years. In1998, the total number of disputes was 1097 which fell by more than half to 440 in 2006.It is beingestimated that this trend will continue in 2007 as well. To support this, only 45 cases of disputes havebeen recorded during the first four months of 2007. This significant decline is attributed to the seriousattempts made by industries to improve industrial relations with their workers. However, a deeper lookat the data reveals that the number of mandays (i.e., the industrial unit of production equal to the workone person can produce in a day) lost due to disputes has not come down as significantly. The country,
on an average, lost 25.4 million mandays of work annually between 1998and 2006, which might have affected its industrial output.More than 2.14 lakh mandays were lost due to work stoppages in 23 industrial disputes during Januaryto March 2007. Though there has been a decline in the number of strikes, the country still witnessedsome major strikes between 2004 and 2006, like those in Honda, Escorts, Apollo, and Skumars factoriesand in SBI bank.On analyzing the data sector wise, it is clear that the private sector has witnessed greater number ofdisputes as compared to the public sector. In 2005, only 57 disputes were recorded in public sectorwhich resulted in a wage loss of 79 Crores. In contrast to this, 399 disputes were recorded in the privatesector. In the recent past, maximum number of disputes has been recorded in the manufacturing,agriculture and mining and quarrying industries.
StrikesA strike is a very powerful weapon used by trade unions and other labor associations to get theirdemands accepted. It generally involves quitting of work by a group of workers for the purposeof bringing the pressure on their employer so that their demands get accepted. When workerscollectively cease to work in a particular industry, they are said to be on strike. According to Industrial Disputes Act 1947, a strike is “a cessation of work by a body of persons employed in an industry acting in combination; or a concerted refusal of any number of persons who are or have been so employed to continue to work or to accept employment; or a refusal under a common understanding of any number of such persons to continue to work or toaccept employment”. This definition throws light on a few aspects of a strike. Firstly, a strike is areferred to as stoppage of work by a group of workers employed in a particular industry.Secondly, it also includes the refusal of a number of employees to continue work under theiremployer.In a strike, a group of workers agree to stop working to protest against something they think isunfair where they work. Labors withhold their services in order to pressurize their employmentor government to meet their demands. Demands made by strikers can range from asking forhigher wages or better benefits to seeking changes in the workplace environment. Strikessometimes occur so that employers listen more carefully to the workers and address theirproblems.
Causes of strikes:Strikes can occur because of the following reasons: • Dissatisfaction with company policy • Salary and incentive problems • Increment not up to the mark • Wrongful discharge or dismissal of workmen • Withdrawal of any concession or privilege • Hours of work and rest intervals • Leaves with wages and holidays • Bonus, profit sharing, Provident fund and gratuity • Retrenchment of workmen and closure of establishment • Dispute connected with minimum wagesTYPES OF STRIKE
1. Economic Strike: Under this type of strike, labors stop their work to enforce their economic demands such as wages and bonus. In these kinds of strikes, workers ask for increase in wages, allowances like traveling allowance, house rent allowance, dearness allowance, bonus and other facilities such as increase in privilege leave and casual leave.2. Sympathetic Strike: When workers of one unit or industry go on strike in sympathy with workers of another unit or industry who are already on strike, it is called a sympathetic strike. The members of other unions involve themselves in a strike to support or express their sympathy with the members of unions who are on strike in other undertakings. The workers of sugar industry may go on strike in sympathy with their fellow workers of the textile industry who may already be on strike.3. General Strike: It means a strike by members of all or most of the unions in a region or an industry. It may be a strike of all the workers in a particular region of industry to force demands common to all the workers. These strikes are usually intended to create political pressure on the ruling government, rather than on any one employer. It may also be an extension of the sympathetic strike to express generalized protest by the workers.4. Sit down Strike: In this case, workers do not absent themselves from their place of work when they are on strike. They keep control over production facilities. But do not work. Such a strike is also known as pen down or tool down strike. Workers show up to their place of employment, but they refuse to work. They also refuse to leave, which makes it very difficult for employer to defy the union and take the workers places. In June 1998, all the Municipal Corporation employees in Punjab observed a pen down strike to protest against the non-acceptance of their demands by the state government.5. Slow Down Strike: Employees remain on their jobs under this type of strike. They do not stop work, but restrict the rate of output in an organized manner. They adopt go-slow tactics to put pressure on the employers.6. Sick-out (or sick-in): In this strike, all or a significant number of union members call in sick on the same day. They don’t break any rules, because they just use their sick leave that was allotted to them on the same day. However, the sudden loss of so many employees all on one day can show the employer just what it would be like if they really went on strike.
7. Wild cat strikes: These strikes are conducted by workers or employees without the authority and consent of unions. In 2004, a significant number of advocated went on wildcat strike at the City Civil Court premises in Bangalore. They were protesting against some remarks allegedly made against them by an Assistant CommissionerLockoutsA lockout is a work stoppage in which an employer prevents employees from working. It isdeclared by employers to put pressure on their workers. This is different from a strike, in whichemployees refuse to work. Thus, a lockout is employers’ weapon while a strike is raised on partof employees. Acc to Industrial Disputes Act 1947, lock-out means the temporary closing of aplace of employment or the suspension of work or the refusal by an employer to continue toemploy any number of persons employed by him.A lockout may happen for several reasons. When only part of a trade union votes to strike, thepurpose of a lockout is to put pressure on a union by reducing the number of members who areable to work.For example, if a group of the workers strike so that the work of the rest of the workers becomesimpossible or less productive, the employer may declare a lockout until the workers end thestrike. Another case in which an employer may impose a lockout is to avoid slowdowns orintermittent work-stoppages. Occupation of factories has been the traditional method of responseto lock-outs by the workers movement.PICKETINGWhen workers are dissuaded from work by stationing certain men at the factory gates, such astep is known as picketing. If picketing does not involve any violence, it is perfectly legal.Pickets are workers who are on strike that stand at the entrance to their workplace. It is basicallya method of drawing public attention towards the fact that there is a dispute between themanagement and employees.The purpose of picketing is: • to stop or persuade workers not to go to work • to tell the public about the strike • to persuade workers to take their unions side
GHERAOGherao in Hindi means to surround. It denotes a collective action initiated by a group of workersunder which members of the management are prohibited from leaving the industrialestablishment premises by workers who block the exit gates by forming human barricades. Theworkers may gherao the members of the management by blocking their exits and forcing them tostay inside their cabins. The main object of gherao is to inflict physical and mental torture to theperson being gheraoed and hence this weapon disturbs the industrial peace to a great extent.Analysis Of Strikes and LockoutsIn 1990, 1,825 strikes and lockouts were recorded. As a result, 24.1 million workdays were lost,from which 10.6 million were lost to strikes and 13.5 million to lockouts. More than 1.3 millionworkers were involved in these labor disputes. The number and seriousness of strikes andlockouts have varied from year to year. As can be seen from the below chart, there has been asteep decline in the number of strikes and lockouts. This continuous decline in strikes andlockouts indicates that the industrial relations in India are improving. There were 227 strikes in2005, resulting in the loss of 10.81 million man-days, while the number of lockouts stood at 229with a loss of 18.86 million man-days. In January-September 2006, there were only 154 strikesand 192 lockouts across the country, as compared to the statistics of 2005, which resulted in thetime loss of 3.16 million man-days and 10.60 million man-days respectively.
The number of strikes and lockouts, taken together, was down by 4.4 per cent in 2005. During2005, West Bengal experienced the maximum instances of strikes and lockouts (19216) followedby Kerala (3619) and Rajasthan (19247). Industrial disturbances were concentrated mainly inmanufacturing (textile), financial intermediation, agriculture and mining and quarrying industriesduring 2005.
During 2000, 426 strikes and 325 lockouts were observed which resulted in total time-loss of28.76 million mandays. Maximum time-loss was caused by 297 lockouts during 2003 whichresulted in a time-loss of 27.05 million mandays. As compared to previous years, in 2006 only13.76 million mandays were lost due to strikes and lockouts.Prohibition of Strikes and Lock-OutsEmployees are prohibited from striking according to the section 22 of Industrial Disputes Act1947. Employees, who are working in a public utility service, cannot go on a strike withoutgiving a notice of strike within the six weeks before striking. They can not go on strike eitherwithin fourteen days of providing the strike notice or before the expiry of the date of strikespecified in any such notice. The same rule applies to the employers. Employers who arecarrying on a public utility service can not lockout any of their employees without giving them aprior notice within six weeks before the lock out or within the fourteen days of giving such anotice. Moreover, the notice of strike or lockout is to be given in a prescribed manner showingthe number of persons involved in the strike/lockout.The notice of strike or lockout is not necessary when there is already a strike or lockout going onin the company. However, a notice should be issued on the day on which the lockout is declaredjust to intimate the appropriate authorities about the lockout. The employer is supposed to reportthe number of notices of strikes received by him to the appropriate Government or the authorityprescribed by the government within the five days of receiving such notices.Illegal Strikes and Lock-OutsA strike or a lock-out is illegal if it is declared in noncompliance with the section 22 (as definedabove) of Industrial Disputes Act 1947, that is, if the notice period is not served or if the strike isheld within the fourteen days of issuing the notice of strike. If a strike or lockout has alreadytaken place and is being referred to a Board, the continuance of such a strike or lock out is notillegal provided it is in compliance with the provisions of act. Moreover, a lockout declared inconsequence of an illegal strike or a strike declared in consequence of an illegal lock-out shallnot be deemed to be illegal.Penalty for Illegal Strikes and Lock-outsA workman who is involved in an illegal strike can be penalized with imprisonment for a termextendable to a month or with a fine or fifty rupees or both. In similar way, an employer whoinitiates and continues a lockout is punishable with imprisonment extendable to a month or witha fine of one thousand rupees or both. According to Section 25 of Industrial Disputes Act 1947,no person should provide any sort of financial aid to any illegal strike or lock-out. Any personwho knowingly provides such a help in support of any illegal strike or lock-out is punishablewith imprisonment for a term which may extend to six months, or with fine which may extend toone thousand rupees, or with both.Measures For Improving Industrial Relations
The following measures should be taken to achieve good industrial relations: T Strong and Stable Union: A strong and stable union in each industrial enterprise is essential for good industrial relations. The employers can easily ignore a weak union on the plea that it hardly represents the workers. The agreement with such a union will hardly be honored by a large section of workforce. Therefore, there must be strong and stable unions in every enterprise to represent the majority of workers and negotiate with the management about the terms and conditions of service. c Mutual Trust: Both management and labor should help in the development of an atmosphere of mutual cooperation,confidence and respect. Management should adopt a progressive outlook and should recognizethe rights of workers. Similarly, labor unions should persuade their members to work for thecommon objectives of the organization. Both the management and the unions should have faithin collective bargaining and other peaceful methods of settling disputes. • Workers’ Participation in Management: The participation of workers in the management of the industrial unit should be encouraged by making effective use of works committees, joint consultation and other methods. This will improve communication between managers and workers, increase productivity and lead to greater effectiveness. • Mutual Accommodation. The employers must recognize the right of collective bargaining of the trade unions. In any organization, there must be a great emphasis on mutual accommodation rather than conflict or uncompromising attitude. One must clearly understand that conflicting attitude does not lead to amicable labor relations; it may foster union militancy as the union reacts by engaging in pressure tactics. The approach must be of mutual “give and take rather than “take or leave.” The management should be willing to co-operate rather than blackmail the workers. • Sincere Implementation of Agreements. The management should sincerely implement the settlements reached with the trade unions. The agreements between the management and the unions should be enforced both in letter and spirit. If the agreements are not implemented then both the union and management stop trusting each other. An environment of uncertainty is created. To avoid this, efforts should be made at both ends to ensure the follow up of the agreements. • Sound Personnel Policies: The following points should be noted regarding the personnel policies. The policies should be: o Formulated in consultation with the workers and their representatives if they are to be implemented effectively.
o Clearly stated so that there is no confusion in the mind of anybody. o Implementation of the policies should be uniform throughout the organization to ensure fair treatment to each worker.• Government’s Role: The Government should play an active role for promoting industrial peace. It should make law for the compulsory recognition of a representative union in each industrial unit. It should intervene to settle disputes if the management and the workers are unable to settle their disputes. This will restore industrial harmony.• Progressive Outlook: There should be progressive outlook of the management of each industrial enterprise. It should be conscious of its obligations and responsibilities to the owners of the business, the employees, the consumers and the nation. The management must recognize the rights of workers to organize unions to protect their economic and social interests.