Collective barganing

2. After studying this chapter, you should be able to:

3. Difference between ER & IR
Employee Relations
study of the relationship between
employees and also between
employers and employees.
often results in higher engagement,
higher motivation and ultimately
improved productivity and
profitability.
providing information to employees
on the goals of the organisation.
Employees should understand the
ultimate goals of the business
and what their role is in achieving
these goals.
Industrial Relations
means to understand the complex
relationship between employers and
employees.
An employee associates IR with better
safety, training, job security, pay and
conditions in the workplace.
An employer understands it to be
about productivity, employment law
and conflict resolution.
Its about collective bargaining, unions,
resolution of disputes,Grievances &
Disciplinary Policy..

4. Objectives of IR
To enhance economic status of worker.
To avoid industrial conflicts and their consequences.
To provide an opportunity to the worker to have a say in the
management decision making.
To regulate production by minimizing conflicts.
To provide forum to the workers to solve their problems through
mutual negotiation and consultations with management.
To encourage and develop trade union in order to develop workers
collective strength.

5. Workers’ participation in
management
Traditionally the
concept ofWorkers’
Participation in
Management (WPM)
refers to participation of
non- managerial
employees in the
decision-making
process of the
organization.
Workers’ participation is
also known as ‘labour
participation’ or
‘employee participation’
in management.
Workers’ participation
in management implies
mental and emotional
involvement of workers
in the management of
Enterprise. —
It is
considered as a
mechanism where
workers have a say in
the decision-making.

6. Workers’ participation in
management
According to Keith Davis,
• Participation refers to the
mental and emotional
involvement of a person in a
group situation which
encourages him to
contribute to group goals
and share the responsibility
of achievement.
According toWalpole,
• Participation in
Management gives the
worker a sense of
importance, pride and
accomplishment; it gives
him the freedom of
opportunity for self-
expression; a feeling of
belongingness with the
place of work and a sense of
workmanship and creativity.

7. Features ofWPM:
Participation means mental and emotional involvement rather than mere
physical presence.
Workers participate in management not as individuals but collectively as a
group through their representatives.
Workers’ participation in management may be formal or informal. In
both the cases it is a system of communication and consultation
whereby employees express their opinions and contribute to managerial
decisions.
It provides scope for employees in decision-making of the organization.
The participation may be at the shop level, departmental level or at the top
level.
The participation includes the willingness to share the responsibility of the
organization by the workers.

8. WPM
There can be 5 levels of
Management
Participation orWPM:
Information
participation: It ensures
that employees are able
to receive information
and express their views
pertaining to the matter
of general economic
importance.
Consultative
importance: Here
workers are consulted
on the matters of
employee welfare such
as work, safety and
health. However, final
decision always rests
with the top-level
management, as
employees’ views are
only advisory in nature.

9. WPM
Associative participation: It is an
extension of consultative participation
as management here is under the
moral obligation to accept and
implement the unanimous decisions of
the employees. Under this method the
managers and workers jointly take
decisions.
Administrative participation: It
ensures greater share of workers’
participation in discharge of
managerial functions. Here, decisions
already taken by the management
come to employees, preferably with
alternatives for administration and
employees have to select the best
from those for implementation.
Decisive participation: Highest level of
participation where decisions are
jointly taken on the matters relating to
production, welfare etc.

10. Strategies / Methods / Schemes / Forms of
WPM:
Suggestion schemes: Participation of workers can take place through
suggestion scheme.
Under this method workers are invited and encouraged to offer
suggestions for improving the working of the enterprise.
Periodically all the suggestions are scrutinized by the suggestion
committee or suggestion screening committee.
The committee is constituted by equal representation from the
management and the workers.
Good suggestions are accepted for implementation and suitable awards
are given to the concerned workers.
Suggestion schemes encourage workers’ interest in the functioning of an
enterprise.

11. Strategies / Methods / Schemes / Forms ofWPM:
Works committee deals with matters of day-to-day functioning at the shop floor level
conditions of work such as ventilation, lighting and sanitation, Amenities ,medical and health
services, Educational and recreational activities, Safety measures, accident prevention
mechanisms etc.
The main purpose of this committee is to provide measures for securing and preserving amity
and good relations between the employer and the employees.
Such a committee consists of equal number of representatives from the employer and the
employees.
Works committee: Under the Industrial Disputes Act, 1947, every establishment employing 100
or more workers is required to constitute a works committee.

12. Strategies / Methods / Schemes / Forms of
WPM:
Joint ManagementCouncils:These councils consist of equal
number of representatives of the employers and employees, not
exceeding 12 at the plant level.
The plant should employ at least500 workers.The council
discusses various matters relating to the working of the industry.
This council is entrusted with the responsibility of administering
welfare measures, supervision of safety and health schemes,
scheduling of working hours, rewards for suggestions etc.

13. Strategies / Methods / Schemes / Forms ofWPM:

14. Definitions
Collective bargaining is an agreement between a single employer
or an association of employers on the one hand and a labour
union on the other, which regulates the terms and conditions of
employment”
TudwigTeller

15. Collective bargaining
process between employers and employees
to reach an agreement regarding the rights and duties of
people at work
aims to reach a collective agreement
usually sets out issues such as employees pay, working
hours, training, health and safety, and rights to participate
in workplace or company affairs.

16. Why DoWorkers Organize?
•Solidarity
•To get their fair share of the pie.
• Improved wages, hours, working conditions, and benefits
•To protect themselves from management
whims.
•Prevent from exploitation

17. Union Security
• The company can hire only union members.
Closed shop
• The company can hire nonunion people, but they must
join the union after a prescribed period of time and pay
dues. (If not, they can be fired.)
Union shop
• Employees who do not belong to the union still must pay
union dues on the assumption that the union’s efforts
benefit all the workers.
Agency shop
• It is up to the workers whether or not they join the
union—those who do not, do not pay dues.
Open shop
• Employees do not have to belong to the union. However,
union members employed by the firm must maintain
membership in the union for the contract period.
Maintenance of
membership
arrangement

18. Trade Union Act 1926

19. Provisions ofTrade Union Act
Provisions
Definitions
(S2)
Registration
(S 3-12)
Duties
(S 17-21)
Amalgamati
on &
Dissolution
(S24-27)
Submission
of Returns
(s 28)
Penalties &
Fine
( S31 to 33)
Rights ( S 17
to 21)
Powers to
make
regulations
(S 29-30)

20. Important definitions
Appropriate Government
Executive
Registered Office
RegisteredTrade Union
Trade Dispute
Trade Union
Workmen

21. The Union Drive
Step 1. Appointment of registrars
• TheAct empowers the appropriate
government to appoint a person to
be the Registrar ofTrade Unions for
each state.
Mode of registration (section 3 to 12)
• Any seven or more members of a
Trade Union may, by subscribing
their names to the rules of theTrade
Union apply for registration of the
Trade Union under this Act.
• Provided that noTrade Union of
workmen shall be registered unless
at least ten per cent or one hundred
of the workmen, whichever is less,
engaged or employed in the
establishment or industry with which
it is connected are the members of
suchTrade Union on the date of
making of application for
registration.

22. The Union Drive (Contd.)
Elections of Office Bearers
Tenure ( 3yrs)
How a member is entitle to benefit
Security of fund
Annual audit
Dissolve

23. Rights and obligations
The general funds of a
registeredTrade Union shall not
be spent on any other objects
than the following, namely:—
Payment of salaries,
allowances and expenses to
office-bearers of theTrade
Union.
Payment of expenses for the
administration and audit.
Prosecution or defense of any
legal proceedings for
securing or protecting its
rights.
The conduct of trade disputes
on behalf of theTrade Union or
any member thereof;
The compensation of
members for loss arising out
of trade disputes
Allowances to members or
their dependents on account
of death, old age, sickness,
accidents or unemployment of
such members.
The provision of education,
social or religious benefits for
members (including the
payment of the expenses of
funeral or religious ceremonies
for deceased members) or for
the dependents of members.
Publication of labour journals.

24. Industrial Dispute Act 1947
Industrial Dispute
• is defined as any dispute or difference between employers and
employers or between employers and workmen or between
workmen and workmen which is connected with the employment or
non-employment or the terms of employment or with the condition
of labour of any person.
Objectives
• Promotion of measures for securing and preserving amity and good
relation between the employers and workers
• Investigation and settlement of industrial disputes
• Prevention of illegal strikes and lock–outs
• Relief to workmen in the matter of lay–off and retrenchment
• Promotion of collective bargaining

25. Industrial Dispute Act 1947
•ThisAct emphasis on compulsory adjudication besides conciliation and
voluntary arbitration of Industrial Disputes
•Mediation is an alternative dispute resolution method where a neutral and
impartial third party, the mediator, facilitates dialogue in a structured
multi-stage process to help parties reach a conclusive and mutually
satisfactory agreement. Mediation, however, is a voluntary and non-
binding process
•The “conciliator” is an impartial person that assists the parties by driving
their negotiations and directing them towards a satisfactory agreement. It
seeks to identify a right that has been violated and searches to find the
optimal solution.
•an arbitration is the reference of dispute or difference between not less
than two parties, for determination after hearing both sides in a judicial
manner by a person or persons other than a court of competent jurisdiction

26. Industrial Dispute Act 1947
• The Act empower the Government to make reference of the dispute to
an appropriate authority ie, Labour court, Industrial tribunal and
National tribunal depending upon the nature of the dispute either on
its own or on the request of the parties
• The right to strike by the workers and lock–out by the employees has
been subjected to the restriction as laid down in the Act
• The act prohibits strikes and lock–outs during the pending of
conciliation and arbitration proceedings and in public utility service and
it empowers government to take adequate action
• Defines: wages, industry, workmen, settlement, public utility service

27. Authorities under Industrial Dispute
Act,1947
• Works Committee (Sec 3)
• ConciliationOfficers (Sec 4)
• Board of Conciliation (Sec 5)
• Court of Inquiry (Sec 6)
• Labour Court (Sec 7)
• IndustrialTribunal (Sec7-A)
• NationalTribunal (Sec7-B)

28. Causes of Dispute
• Wages
• Union Rivalry
• Political Interference
• UnfairTrade Practices ( defined in Industrial DisputeAct)
• Multiplicity of Labour Laws

29. The Collective Bargaining Process
• What Is collective bargaining?
• Both management and labor are required by law to negotiate wage,
hours, and terms and conditions of employment “in good faith.”
• What Is good faith bargaining?
• Both parties communicate and negotiate.
• They match proposals with counterproposals in a reasonable effort to
arrive at an agreement.
• It does not mean that one party compels another to agree to a proposal
or make any specific concessions.

30. Collective Bargaining in India
• Emphasized in 1-3 five year plans
• Formation of NationalCommission on Labour in 1966 CB came in
fore front.
• Problems
• Lack of strong trade unions
• Unwillingness of EmployerOrganisation
• Union rivalry
• Inclination towards compulsory adjudication rather than voluntary
arbitration.

31. Features of Collective Bargaining
• Group & CollectiveAction
• Strength
• Continuous Process
• Flexible
• Voluntary
• Dynamic
• Power Relationship
• Bipartite Process

32. OBJECTIVES OF COLLECTIVE
BARGAINING
• To provide an opportunity to the workers,
• to voice their problems on issues related to employment.
• To facilitate reaching a solution that is acceptable to all the parties
involves.
• To resolve all conflicts and disputes in a mutually agreeable manner
• To prevent any conflict/disputes in the future through mutually signed
contracts

33. OBJECTIVES OF COLLECTIVE
BARGAINING
• To develop a conductive atmosphere to foster good organizations
relations.
• To provide stable and peaceful organization (hospital) relations.
• To enhance the productivity of the organization by preventing
strikes lock – out etc.

34. Types of collective bargaining

36. Collective Bargaining Process

37. Preparing for Negotiations
• Sources of negotiating information
• Local and industry pay and benefits comparisons
• Distribution demographics of the workforce
• Benefit costs, overall earnings levels, and the amount and cost of
overtime
• Cost of the current labor contract and the increased cost—total,
per employee, and per hour—of the union’s demands.
• Grievances and feedback from supervisors
• Counteroffers and arguments.

38. Preparing for Negotiations
(cont’d)
• Sources of negotiating information (cont’d)
• Attitude surveys to test employee reactions to sections of the contract
that management may feel require change
• informal conferences with local union leaders to discuss the operational
effectiveness of the contract and to send up trial balloons on
management ideas for change.

39. Classes of Bargaining Items
•Voluntary (permissible) bargaining items
• Items in collective bargaining over which bargaining is neither
illegal nor mandatory—neither party can be compelled against its
wishes to negotiate over those items.
•Illegal bargaining items
• Items in collective bargaining that are forbidden by law; for
example, a clause agreeing to hire “union members exclusively”
would be illegal in a right-to-work state.
•Mandatory bargaining items
• Items in collective bargaining that a party must bargain over if
they are introduced by the other party—for example, pay.

40. Bargaining Items
Mandatory
Rates of pay
Wages
Hours of employment
Overtime pay
Shift differentials
Holidays
Vacations
Severance pay
Pensions
Insurance benefits
Profit-sharing plans
Festivals bonuses
Company housing, meals,
and discounts
Employee security
Job performance
Union security
Management–union
relationship
Drug testing of employees
Permissible
Indemnity bonds
Management rights as to
union affairs
Pension benefits of
retired employees
Scope of the bargaining unit
Including supervisors
in the contract
Additional parties to the
contract such as the
international union
Use of union label
Settlement of unfair labor changes
Prices in cafeteria
Continuance of past contract
Membership of bargaining team
Employment of strike breakers
Illegal
Closed shop
Separation of employees
based on race
Discriminatory treatment
Source: Michael B. Carnell and Christina Heavrin,
Labor Relations and Collective Bargaining (Upper
Saddle River, NJ: Prentice Hall, 2001), p. 177.

41. Bargaining Stages
•Presentation of initial demands
• Both parties are usually quite far apart on some issues.
•Reduction of demands
• Each side trades off some of its demands to gain others.
•Subcommittee studies
• The parties form joint subcommittees to try to work out
reasonable alternatives.
•An informal settlement
• Each group goes back to its sponsor. Union seeks to have
members vote to ratify the agreement.
•Signing the formal agreement

42. Impasses, Mediation, and Strikes
• An impasse
• Usually occurs because one party is demanding more than the other will
offer.
• Sometimes an impasse can be resolved through a third party—a
disinterested person such as a mediator or arbitrator.
• If the impasse is not resolved in this way, the union may call a work
stoppage, or strike, to put pressure on management.

43. Strikes
• Economic strike
• Results from a failure to agree on the terms of a contract.
• Unfair labor practice strikes
• Called to protest illegal conduct by the employer.
• Wildcat strike
• An unauthorized strike occurring during the term of a contract.
• Sympathy strike
• Occurs when one union strikes in support of the strike of another union.

44. Essentials of Successful collective
Bargaining
• Favourable PoliticalClimate
• Strong & Stable Unions
• Recognition
• Willingness to give & take
• Negotiator’sAuthority
• Fair practices
• PositiveAttitude rather than a fighting approach

45. Inhibiting Factors
• Employer’s Reluctance
• Multiple Unions
• Non-Recognition
• Weak Unions
• Political Interference
• Inadequate Interventions

46. Main Sections of a Contract
Agreement
•Management rights
•Union security and automatic payroll dues deduction
•Grievance procedures
•Arbitration of grievances
•Disciplinary procedures
•Compensation rates
•Hours of work and overtime
•Benefits: vacations, holidays, insurance, pensions
•Health and safety provisions
•Employee security seniority provisions, and
•Contract expiration date.

47. The Factories Act, 1948
• the Factories Act, 1948 consolidating and amending the law relating
to labour in factories.
• Objectives:
• to regulate the working conditions in factories, to regulate health,
safety welfare, and annual leave and enact special provision in
respect of young persons, women and children who work in the
factories.
• to safeguard the interests of workers, stop their exploitation and
take care of their safety, hygiene and welfare at their places of work.
• It casts various obligations, duties and responsibilities on the
occupier of a factory and also on the factory manager.
• Amendments to the Act and court decisions have further extended
the nature and scope of the concept of occupier, especially vis-a-vis
hazardous processes in factories.

48. The Minimum Wage Act 1948
• to secure the welfare of unorganised workers in certain industries by fixing
the minimum rates of wages. the Act contemplates that minimum wages
rates must ensure for him not only his subsistence and that of his family
but also preserve his efficiency as a workman.
• The Act empowers the appropriate Government for fixation of minimum
wages in employments enumerated in the schedule to the Act. The
fixation of minimum wages relates to the industries where sweated labour
is most prevalent or where there is inevitable chance of exploitation.
• In prescribing the minimum wages rates, the capacity of the employers
need to be considered as the State assumes that every employer must pay
the minimum wages if he employs labour.

49. Code of Discipline
• Defines duties and responsibilities of employers & workers.
• Objectives:
• To maintain discipline in industry
• Promote constructive cooperation
• Eliminate all forms of coercion, intimidation & violence in IR.
• Avoid work stoppages

50. Grievances
• Grievance
• Employee’s dissatisfaction or feeling of personal injustice relating to his
or her employment relationship.
• Any factor involving wages, hours, or conditions of employment that is
used as a complaint against the employer.
• Sources of grievances
• Absenteeism
• Insubordination
• Overtime
• Plant rules
• Violation of law/rules.
• Violation of health/safety standards

51. Grievance Procedure

52. Handling Grievances: Do
• Investigate and handle each case as though it may eventually result in
arbitration.
• Talk with the employee about his or her grievance; give the person a full
hearing.
• Require the union to identify specific contractual provisions allegedly violated.
• Comply with the contractual time limits for handling the grievance.
• Visit the work area of the grievance.
• Determine whether there were any witnesses.
• Examine the grievant’s personnel record.
• Fully examine prior grievance records.
• Treat the union representative as your equal.
• Hold your grievance discussions privately.
• Fully inform your own supervisor of grievance matters.

53. Handling Grievances: Don’t
• Discuss the case with the union steward alone—the grievant should be there.
• Make arrangements with individual employees that are inconsistent with the
labor agreement.
• Hold back the remedy if the company is wrong.
• Admit to the binding effect of a past practice.
• Relinquish to the union your rights as a manager.
• Settle grievances based on what is “fair.” Instead, stick to the labor agreement.
• Bargain over items not covered by the contract.
• Treat as subject to arbitration claims demanding the discipline or discharge of
managers.
• Give long written grievance answers.
• Trade a grievance settlement for a grievance withdrawal.
• Deny grievances because “your hands have been tied by management.”
• Agree to informal amendments in the contract.