Trade Unions

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Lesson: 42

Title: Let us unionise! : Trade Unions
Topics to be covered:

• Introduction
• Definitions
• Features
• Objectives
• Functions
• Employers’ point of view: Criticism of trade unions
• Motivation to join unions
• Structure
• Problems and weaknesses
• Suggestions for healthy growth of unionism
• Article: “Indian Trade Unions: Today and Beyond” By: Ernesto Noronha

Hello Students!

Today we will be discussing Trade unions and their role. We will also be discussing the
problems and weaknesses and of course, how to overcome those weaknesses.

Let us begin discussing the nature and functions of trade unions.

What is your idea of a Union?

We have discussed this term before, in the introductory lessons of Industrial Relations!

It is indeed the collection of workers that is formed for demanding its rights and overall
welfare.

We will be discussing the definition. Let us begin by discussing the nature of Trade
unions.

Nature and functions of Trade Unions

Trade union movement is an offshoot of industrialisation. The growth of modern
industrial organisations involving use of modern technology and employment of workers
has been followed by growth of trade unions throughout the world.
The workers feel threatened and I am sure you will agree that whenever there is some
fear or threat, one comes closer. That applies to the Unions as well. The workers have the
fear of being obsolete because of the increased use of technology. They form themselves
into groups and feel that they can then not only overcome that fear but also fight better
for their welfare.



This phenomenon has not only been observed in advanced countries of the world, but
also in the developing economies like India.

The emergence of trade unionism is spontaneous and inherent in the growth of
capitalism. The origin of trade unionism lies in the industrial revolution, which disrupted
the older way of life and created a new society forged by the shop, the factory, the mine
and the industry.

Please note that wherever a union exists, top management cannot take unilateral
decisions. Management has to consult the union representatives while taking various
decisions affecting labour such as wages, lay-off, transfer, discharge, etc. A trade union
puts restriction on the discretion of employers for taking decisions involving welfare of
employees. In certain organisations, unions have become so strong that they affect every
aspect of management.

Now let us discuss the definition.

Definition of Trade Union

Section 2(h) of the Trade Unions Act, 1926 has defined a trade union as

“Any combination, whether temporary or permanent, formed primarily for the purpose
of regulating the relations between workmen and employers, or between workmen and
workmen, or between employers and employers, or for imposing restrictive conditions on
the conduct of any trade or business, and includes any federation of two or more trade
unions.”

This definition is very exhaustive as it includes associations of both the workers and
employers and the federations of their associations. I hope you are not confused!

Let me make this definition simpler for you.

In this definition the relationships that have been talked about are both temporary and
permanent. Please note that it applies to temporary workers as well.

Then this definition talks about three relationships. They are relationship between the:

Workmen and workmen
Workmen and employers
Employers and employers.

Yes please don’t be surprised; it includes the relationship between the employers and the
employers as well!

Let us look at another definition by Dale Yoder.



Dale Yoder has defined trade union as a continuing long – term association of employees
formed and maintained for the specific purpose of advancing and protecting the interests
of members in their working relationships.

He quotes: “A trade union is a continuous association of workers which is formed with
the purpose of protecting the interests of workers.”

Now that is simple and sweet, sweet in the sense it is easy to understand.

Let us see another one!

According to Flippo “A labour union or trade union is an organisation of workers formed
to promote, protect, and improve, through collective action, the social, economic, and
political interests of its members”.

I hope you have understood that……..

If you haven’t, analysing this definition we can draw the features of trade Unions:

Features of trade unions:

I. It is an organisation formed by employees or workers.

II. It is formed on a continuous basis. It is a permanent body and not a casual or
temporary one.

III. 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.

IV. It includes federations of trade unions also.

V. It achieves its objectives through collective action and group effort.

Having understood the features let us come on to the next topic for today and that is
objectives of Trade Unions that is why do workers organise themselves into unions?

Objectives of Trade Union

Workers organise themselves in the form of a union to achieve the following goals:

a) To improve the economic lot of employees by securing for them better wages.
b) To secure better working conditions for the workers.
c) To secure bonus for the employees from the profit of the concern,



d) To resist schemes of the management which reduce employment, e.g.,
rationalisation and automation.
e) To secure welfare of employees through group schemes which give benefit to
every employee.
f) To protect the interests of employees by taking active participation in the
management.
g) To secure social welfare of the employees.
h) To secure organisational stability, growth, and leadership.

Now let me ask you that what do you unionise for. What is it that you form group or a
team to ask for things from your parents? I am sure you must be conniving with your
brothers and sisters to blackmail your parents!!

Come on, you can share it with me, I will not tell them anyway!!

Please understand that things could get nasty at times with the unions.

Now what do I mean by that!

Let us study the functions of the Trade unions and you will understand that better.

Functions of Trade Unions

Broadly speaking, trade unions perform two types of functions, viz.,
(i) Militant functions
(ii) Fraternal functions,

Militant 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 of collective bargaining
and negotiations, they adopt an approach and put up a fight with the management in the
form of so-slow, strike, boycott, gherao, etc. Hence, these functions of the trade unions
are known as militant or fighting functions.

The second one is the fraternal function. Can you guess what could it mean? Or rather
where has it been derived from?

You guessed it right!

Maternal and………fraternal that is fatherly role.

Fraternal Functions. Another set of activities performed by trade unions aims at
rendering help to its members in times of need, and improving their efficiency. Trade



unions try to foster a spirit of cooperation and promote friendly relations and diffuse
education and culture among their members.

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 unions raise by subscription from members and donations from outsiders, and
also on their competent and enlightened leadership.

Now that is like good fathers!

Another broad classification of the functions of unions may be as follows:

(a) Intra-mural activities
(b) Extra-mural activities
(c) Political activities.

Intra-mural activities. These consist of those functions of the unions that lead to the
betterment of employment conditions such as ensuring adequate wages and salaries,
etc. for which the methods adopted may be collective bargaining, negotiations, strikes,
etc.

Extra-mural activities. These activities help the employees to maintain and improve
their efficiency or productivity, e.g., measures intended to foster a spirit of cooperation,
promote friendly relations, and diffuse education among members and various other types
of welfare measures.

Political activities. Modern trade unions also take up political activities to achieve their
objectives. Such activities may be related to the formation of a political party or those
reflecting an attempt to seek influence on public policy relating to matters connected with
the interests of working class.

Let us now see things from another perspective that is the perspective of the employer.

The management may disregard the Union because of various reasons. These reasons
could be as follows:

Criticism of Trade Unions by the Employers

The employers have subjected trade unions to severe criticism. Some of the charges are
as under:



I. Lack of education makes the workers narrow-minded, and prevents them from
taking long-term views. Thus, anything, which does not result in an immediate
reward, becomes unattractive to them. This attitude is responsible for many
strikes and lock-outs in industrial concerns.

I am sure you will agree with that one.

II. Trade unions may not welcome rationalisation and improved methods of
production for the fear that some of the workers will be put out of work.
Therefore, they resort to go slow policy that retards industrial progress.

III. When labour unions strike because of illogical grounds, incalculable losses occur
to producers, community and the nation. These are harmful to the workers also.
They suffer because of the loss of wages.

IV. They create artificial scarcity of labour by demanding that only union personnel
should be employed.

Now that is not a good practice!!

V. By undue insistence on the payment of standard rates of wages, they have only
leveled down the earnings of the efficient workers.

Coming on to the next topic that is what motivated the workers to join the Unions.

Motivation to join unions

Why do Workers Join Unions? Since human behaviour is goal directed, the
employees will join a union if some of their wants can be fulfilled by membership
in a union. The important forces that make the employees join a union are as
follows:

I. 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.

But I am sure that you will agree, 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. Union is strength after all!

II. Make their Voices Heard. The desire for self-expression is a fundamental
human drive for most people. Don’t you agree with that? All of us wish to



share our feelings, ideas and opinions with others. Similarly the workers
also want the management to listen to them.

A trade union provides such a forum where the feelings, ideas and opinions of
the workers could be discussed. It can also transmit the feelings, ideas,
opinions and complaints of the workers to the management. The collective
voice of the workers is heard by the management and give due consideration
while taking policy decisions by the management.

III. Minimise Discrimination. The decisions regarding pay, work, transfer,
promotion, etc. are highly subjective in nature. I may rate you very
differently as compared to your marketing teacher! Similarly the personal
relationships existing between the supervisor and each of his subordinates
may influence the management. Thus, there are chances of favouritisms and
discriminations.

A trade union can compel the management to formulate personnel policies
that press for equality of treatment to the workers. All the labour decisions of
the management are under close scrutiny of the labour union. This has the
effect of minimising favouritism and discrimination.

IV. Sense of Security. The employees may join the unions because of their
belief that it is an effective way to secure adequate 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 and compel the management to invest in welfare services for the
benefit of the workers.

V. Sense of Participation. The employees can participate in management of
matters affecting their interests only if they join trade unions. They can
influence the decisions that are taken as a result of collective bargaining
between the union and the management.

I hope you have not forgotten Collective bargaining!

VI. Sense of Belongingness. Many 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 time at
work. On the other hand, those who are members of a union feel that they
gain respect in the eyes of their fellow workers. They can also discuss their
problem with’ the trade union leaders.

And now the next topic for the day!



Structure of Trade Unions:

The structure of unions refers to the basis on which unions are organised (i.e., whether
they are organised on craft or industrial or general union basis) and to the pattern
whereby the plant unions are linked to regional level or national level federations or
unions.

Let us examine these two aspects one by one:

Unions in India are largely organised by industry rather than craft. Although industrial
unionism has been the general trend, craft unions have also emerged here and there;
primarily, they exist among non-manual workers like administrative staff, professionals,
technicians, etc. Ahmedabad Textile Labour Association is the sole example of craft
union of manual workers.

Another aspect of the structure of unions in India relates to their pattern of relationship
between national level, regional level, local level and plant level unions.

Let us see how they are related in India.

I. Plant level Unions: The first level in the structure from below is the plant level
union. This comprises the unions in one organisation or factory. Please note that
only seven members are required to form a union. This has lead to multiple
unions in one factory. (We will discuss the details of this aspect in the problems
faced by unions in India).

II. Local Level federations. This is the second level in the structure from below.
The local trade union federation holds together the plant level unions at the local
level in a particular craft and industry. These local level federations might be
affiliated to either some regional level or national level federation or these may be
independent.

III. Regional level federations. These are the organisations of all the constituent
unions in a particular state or region.

The importance of such federations cannot be exaggerated. In a country like India,
conditions vary form region to region. The style of living, languages, customs,
traditions, conditions, etc. are different. Therefore, it is better that workers are
organised at regional or state level.

These regional federations may have members of two kinds:

(1) The plant ‘level unions affiliating themselves to these directly and

(2) The local federations.



In the second case, plant level unions become the members of regional federation
indirectly through the local federations.

It may be noted that the regional federations may be independent or they may get
affiliated to some national federation.

IV. National federations. These are national level bodies to which plant level
unions, local unions or regional level unions may get affiliated. These are the
apex bodies at the top of the structure. They act as coordinating bodies. These
national federations may have their own regional or state level coordinating
bodies to which the plant level unions may get affiliated.

Let us summarise the levels in a diagrammatic form.

National Level Federations

Regional Level Federations

Local Level Federations

Plant Level Federations

Let us learn something about the central level organisations.

Four important central organisations of workers in India are

1. The Indian National Trade Union Congress (INTUC). The Congress
Party and the top congress leaders formed the INTUC like Nehru and Patel
were associated with it. Every union affiliated to INTUC has to submit its
dispute to arbitration after exhausting other means of settlement of
disputes.



2. The All India Trade Union Congress (AITUC). This union serves as the
labour forum of Communist Party of India at present. It is considered as
the second largest union in India.

3. The Hind Mazdoor Sabha (HMS). It was formed in Calcutta by the
socialists who neither approved INTUC nor AITUC. The HMS was
organised with a view to keeping its members free from any political or
other outside interference.

4. The United Trade Union Congress (UTUC). Those persons who were
dissident socialist formed it. It functions mainly in Kerala and West
Bengal.

5. Centre for Indian Trade Unions (CITU). The Marxists separated from
the AITUC in May 1970 and formed the CITU.

In addition to the above, there are four other central trade union organisations. They are:

• Bhartiya Mazdoor Sangh (BMS)
• National Labour Organisation (NLO)
• National Front of Indian Trade Unions (NFITU)
• Trade Union Congress Committee (TUCC).

Please don’t get confused with the names.

Have you ever wondered that what could be the problems faced by the Unions!

If not, let us examine them one by one.

Problems and weaknesses of trade unions

The problems and weaknesses of trade unionism in India are as follows:

I. Uneven Growth. The trade unionism in India is characterised by uneven growth,
both industry-wise and area-wise. Trade unions are popular in big industries and
the degree of unionisation varies widely from industry to industry. Besides, trade
union activities are concentrated in a few states and in bigger industrial centers
mainly due to concentration of industries in those places.

II. Limited Membership. The number of trade unions in India has increased
considerably. But this has been followed by the declining membership per union.

This is due to the reason that any seven workers any form a union under the Trade
Unions Act, 1926 and get it registered. Secondly, the rivalry among the leaders of



trade unions has resulted in multiplicity of unions, thereby reducing the average size
of membership per union.

III. Multiplicity of Unions. There exist several trade unions in the same
establishment. The multiplicity of unions is the result of outside leadership and
labour laws. The law permits and gives sanctity to small unions. Any seven
persons can form a union under the Trade Unions Act, 1926. This Act confers
rights on such a union. It is allowed under the Act to raise disputes, file suits, go
to conciliation and even bargain with employers. Therefore, small sections of
workers are encouraged to form separate Unions. There is no restriction on the
number of unions to be registered in one establishment.

You will agree that the existence of multiple unions in an establishment leads to
inter-union rivalry. Different unions attempt to play down each other in their bid
to gain better hold on the workers.

Please understand that this has serious consequences. Workers lose interest in
unionism. Not only that, the employers also get an opportunity to play unions
against each other. They are able to take advantage of infighting among unions
and may refuse to bargain on the plea that there is no strong representative union.
They can argue saying that they don’t know that who should they bargain with.
Thus, multiple unions do more harm than good to the cause of trade unionism.

IV. Outside Leadership. Trade unions in India are led largely by people who
themselves are not workers. These outsiders are politicians, intellectuals and
professionals having no experience of work in industry. Outsiders continue to
dominate the trade unions to advance their personal interests.

The existence of outside leadership has created the following problems:

• Since outsiders have links with political parties, they give greater
importance to the interest of their political parties. At times, they don not
mind sacrificing the interest of their followers for the achievement of
political ends.

• Their approach towards labour problems is coloured by political
considerations. This hampers the growth of healthy employer-employee
relations. When there is an industrial dispute, the leaders try to solve it
through political pressures and interventions. This naturally obstructs the
growth of understanding and accommodation between workers and
employers.

• Outsides leaders are responsible for the creation of multiple unions, in
case they are not satisfied with other union leaders, they would leave that
union with a group of dissident workers and form another rival union in



the same plant. Such an approach kills the solidity and solidarity of trade
union movement.

V. Financial Problems. The financial position of the trade unions is weak because
their average yearly income is very low and inadequate. The subscription rates are
very low. Under conditions of multiplicity of unions, a union interested in
increasing its membership figures keeps the subscription rate unduly low. As a
result, the funds with the unions are inadequate and they cannot undertake welfare
programmes for their members. Another reason for the weak financial position of
union is that large amounts of subscription dues remain unpaid by the workers.
Besides this, unions do not have proper staff and organisation to collect
subscriptions.

And last but not the least, the attitude of the workers also plays an important role in
this regard.

VI. Indifferent Attitude of Workers. In India, a large number of workers have not
joined any union. Moreover, all the members of the trade unions do not show
interest in their affairs. The attendance at the general meetings of the unions is
very low. Under such circumstance, trade unionism cannot be expected to make
much progress.

The problems are so many…….

Where are the solutions?

They are very much here in the form of some suggestions for strengthening the
trade Unionism in India.

What are you thinking?

Are you imagining yourself as an employer and contemplating that where is the
need for strengthening the trade unions?

Please remember that the Unions are not always a threat to the management. They
can be a good source for knowing the feelings of the workers or in other words they
can be the source of feedback. The management can pass on the information to the
workers through the Trade unions. The chosen representatives, will be much more
effective in sharing the information with the workers. I am sure you will agree that
the members of the workers will pay more attention and be willing to listen to the
union members more than the management representatives.

So now coming on to the suggestions.



Suggestions for Healthy Growth of Unionism

Sound trade union has the potentialities for generating a healthy circle of better labour
productivity, increasing earnings of labour, expanding their purchasing power, improving
their working and living conditions, increasing efficiency, and having more production.

Such a state of affairs would be beneficial not only to workers, but also to the industry
and to the nation. Therefore, it is essential to recognise the vital importance of trade
union as an integral part of the industrial structure of India. The Government and many
enlightened employers do appreciate the importance of the role of trade unions, and their
policy is one of encouragement and assistance to the trade unionism.

But please note that the future of trade unionism in Indian depends mainly upon the effort
of the unionists themselves. You must have heard that real strength must come from
within. For developing internal vitality, a strong and stable trade union movement is
essential for the proper functioning of industry.

A few suggestions for the development of such unions are:

I. One Union in One Industry: Multiplicity of unions in the same plant leads to
inter-union rivalry that ultimately cuts at the root of the trade union movement. It
weakens the power for collective bargaining and reduces the effectiveness of
workers in securing their legitimate rights. Therefore, there should be only one
union in one industry.

II. Paid Union Officials: Generally, the trade unions avail the services of the
honorary workers due to lack of funds. The practice should be stopped because
honorary office bearers cannot do full justice to the task entrusted to them because
of lack of time at their disposal. Suppose that you are asked to do something in
the office, which requires a lot of responsibility. You are not offered any thing in
return. Of course the motivational levels will come down unless and until you are
a very passionate or a committed person. The same applies to the officials of the
unions. Therefore, paid union officials should be employed who are persons of
proven integrity and who are able to evaluate the demands of workers so that they
may negotiate with employers on equal footing.

III. Development of Leadership from Within: It is of crucial importance that trade
unions are managed by the workers, and not by outsiders. Leadership should be
developed from within the rank and file of the workers. We have already
discussed the problems related to the outside leadership in the organisations.
Please note that the outside leadership should not be encouraged in the
organisations because of the following reasons:

• The outsiders do not have any knowledge about the functioning of the
organisation



• They do not have any interest
• Their interests could only satisfy political interests.

IV. Recognition of Trade Unions. Till recently, the employers refused recognition to
the trade unions either on the basis that unions consisted of only a minority of
employees or two or more unions existed.

You should be aware that the Trade Unions Act is completely silent on the question
of recognising a trade union for the purpose of collective bargaining. Such a
provision exists, however, in the Annexure A of the Code of Discipline, which is a
voluntary measure.

This Annexure lays down the following criteria for recognising a trade union:

1. Where there are more than one union, a union claiming recognition should have
been functioning for at least one year after registration. Where there is only one
union, this condition would not apply.

2. The membership of the union should cover at least fifteen per cent of the workers
in the establishment concerned. Membership would be counted only of those who
have paid their subscription for at least 3 months during the period of 6 months
immediately preceding the month of reckoning.

3. A union may claim to be recognised as a representative union for workers in all
establishments in an industry in a local area if it has a membership of at least
25% of the workers of that industry in that area.

4. When a union has been recognised, there should be no change in its position for a
period of 2 years.

5. Where there are several unions in an industry or establishment, the one with the
largest membership should be recognised.

6. A representative union for an industry in an area should have the right to
represent the workers in all the establishments in the industry, but if a union of
workers in a particular establishment has membership of 50% or more of the
workers of that establishment, it should have the right to deal with matters of
purely local interest such as, for instance, the handling of grievances pertaining to
its own members. All other workers, who are not members of that union might
either operate through the representative union for the industry or seek redress
directly.

7. Only unions that observe the Code of Discipline are entitled to recognition

Activity:



Please note that registration and recognition of trade unions are not the
same terms. I want you to research on the difference and discuss amongst
yourselves.

And last but not the least, another way of strengthening the trade unions is the
improvement in their financial conditions. The subscription fees should be increased.
The members should pay their dues in time so that the unions have enough money to take
care of the overall benefits and welfare of the workers.



Article from Indian Journal for Industrial Relations (Volume39, July 2003)

INDIAN TRADE UNIONS: TODAY AND BEYOND TOMORROW

Ernesto Noronha

CHANGING WORLD ECONOMY AND LABOUR

The last decade brought sweeping changes to the way in which the world
economy functioned. This qualitative changes in the world economic system can be
attributed to factors such as the advent of new global markets in services, increase of
mergers and takeovers, weakening of anti-monopoly laws and the rise of global consumer
markets. The full globalising potential has been realised with the networking of IT
systems. The Information and Communication Technologies (ICTs) have assisted in the
integration of some elements of the Third World into the production networks of the
multinationals and have broad earned the effective reach of the market (Schiller, 2000).
Economies, previously cushioned from external shocks, are now subject to fluctuations of
global markets (Hyman, 1999). Norms such as privatization, liberalization and
deregulation are no more an issue of debate. The less developed countries (LDCs) in
order to avoid economic and political marginalisation have opened up their economies. In
fact, there is a scramble to provide free trade zones, which not only guarantees exemption
of taxes and duties but also grants institutional and legislative conditions for profitable
exploitation of the labour force. Multinationals can now shop around for the tax and
Labour regime, which suits them best. The multinational corporation and the World
Trade Organisation seek to outlaw national laws, which restrict free trade. In short, the
economic environment has become for harsher and global competition has put new
pressures on national industrial relations regimes (Hyman, 1999).

Evans (1997) states that the response of the labour movement to the establishment
of the WTO has been a muted one. The erosion of trade union power has run alongside
the build up of power on the side of transnational corporations. The pressure on
companies to maintain market share and the weakening of regulatory regimes have
intensified global competition, leading to pressure on Labour standards and lower wages
across the world (Smith, 1999). Today the traditional core constituency of trade union
membership has dwindled. A secure and well-paid working class has ceased to be the
norm, giving way to a flexible production arrangement. The informal economy is seen as
a refuge against depredation of the free market (McMichael, 2000). Plant closings,
relocations abroad, removal of subside and tariffs are justified by the threat of global
competition (Portes, 2000). Plant closings, relocations abroad, removal of subsidies and
tariffs are justified by the threat of global competition (Portes, 2000). “A typical”
employment situations have become increasingly typical. Part-time work, short-term and
casual employment, agency work, self-employment and unemployment have all become
more common. These changes in the constituencies which unions seek to recruit and
represent have posed a new challenges to trade unions. Traditionally a potential trade
union member was a full-time employee. As a result the trade union agenda was



predominantly concerned with terms and conditions of employment like achieving the
payment of a “family wage”, defining and reducing the standard working week, and
constraining the employer’s ability to hire and fire at will (Hyman, 1999).

Furthermore, employees’ traditional identities are being slowly displaced and the
transformatory ideals have lost their grip; workers adopt “ a rational, instrumental or
experimental attitude towards the unions (or parties). To win their support, unions now
have to pass a direct and pragmatic test. However, unions of late have come to be widely
perceived as conservative institutions; primarily concerned with defending the relative
advantages of a minority of the working population.

Management on their part has also established new forms of direct communication, like
team working, as new mechanisms of collective decision-making with employees
(Hyman, 1999). Given this context, unions have been called to abjure the path of conflict
and to explore the path of co-operation.

INDIAN LABOUR TODAY

The changes taking place in the Indian economy since 199 reflect the above situation.
Tariff and non-tariff trade barriers have been lowered, industrial licensing abandoned in
many sectors, private capital permitted in areas reserved for the public sector, restrictions
on foreign direct investment removed, steps have been taken towards privatization, food
subsidies have been reduced and the rupee devalued. This has resulted in a strengthened
presence of multinational companies, increase in redundancy, introduction of new
technologies and new management techniques, the growth of the core/periphery model.

Ghatoshkar (2000) and Noronha (1996) state that Indian management has today
introduced flexibility by restructuring, of companies, banning recruitment of permanent
category employees, shutting of units or departments, transferring of jobs from
bargainable to non-bargainable categories, introducing functional flexibility, intensifying
the working day through pressure to increase productivity, opening parallel plants,
employing contract workers and subcontracting out production .The technological
possibility of the internet has given a boost to downsizing and lean management. The
trend is to outsource work as much as possible to keep the core company small (Mitter,
2000). Further, though law does not allow closure o industrial units without permission
by the government, in practice there are not restrictions on closures. To permit labour
market flexibility there is a call for changes in labour laws. The VRS has enabled
employers to side-step Section 25(N) of the ID Act. Recent, long-term agreements (LTA)
signed by unions at their various plants allow a management the scope for organizing and
reorganizing the work processes. Managements have been able to undo the union power
by relocating units in interior places and simultaneously curbing militancy in existing
plants where there is a strong union (Noronha, 2000). The unions have agreed to
participate in re-layout, relocation, process improvement, reallocation of work,



redeployment of manpower, etc., which enable the company to be competitive
(Sivanathiran, 1999). Threat of industrial closures has forced unions to give up or curb
gains and accept job loss. All rehabilitation packages include enhanced hours of work and
flexibility in rescheduling working hours, holidays, earned leave and so on. Norma
related to workload have also gone up. Wage freeze and even cuts in minimum wages are
introduced. The unions also promise that they will into tolerate any misconduct on the
part of the workers (Sundaram et al, 1996).

Employers have begun to se methods of participation in management as a means to
combine with workers against unions. Union seem to get co-opted into the managements
scheme of things through participation techniques (Sheth, 1993. Many Indian
organisations are now using techniques like quality circles, Kaizen, just-in-time, total
quality management, total empowerment, teamwork, productivity-linked wages, profit
sharing, an performance-based rewards, etc. to increase productivity. The human resource
development approach has developed workers, loyalty towards organizational goals and
unions compete with this for employee loyalty (Krishna and Monappa, 1994). However,
introduction of information technology has not brought about major changes in the way
people work Organisations still rely on on-site direct supervision of workers and personal
interaction as it gets difficult for company to ensure quality of the services and delivery
time. Further, as observed elsewhere in call centers located in India, the diversity of tasks
gets diminished, leading to stressful and repetitive work, e.g. uninterrupted answering of
customer telephones affects the physical and mental health of the employees (Mitter,
2000).

The trends outlined above have led to the creation of two categories of workers who are
less represented trade unions. At one end of the scale are highly skilled workers;
developing new careers and having new aspirations while at the other end are marginal
workers, scattered and prone to exploitation as they tend to fall outside the traditional
employment pattern (ILO, 1999). Dietrich (1984) states that the big national federation of
labour have not been interested in taking up these issues of contract labour have not been
interested in taking up these issues of contract labour and declining industries like
textiles. They concentrate on big profit-making industries where it is easier to get
concessions. ‘While trade unions exploit product market advantages for their members,
management takes advantage of favorable labour market conditions to push more work
on to cheap labour’. Benefits bargained apply only to the existing workers leaving the
door open to recruit at a lower price (Ramaswamy, 1983). This has blunted the
revolutionary potential of labour (Banerjee, 1983). Further, Reddy et al. (1991) observe
that the better-educated workers are oriented towards personal rather than common goals
and this impedes participation in union activity. The workers are involved in union
politics only to the extent that it fulfills their personal gains. Further, traditional unions
organize on an industry-and/or region wide basis but in then ever industries and younger
workers it is at the plant level. The reason for this is that younger workers desire to gain
control over their unions, as the traditional structure of trade unions does not provide a
scope for expression of these aspirations. These workers are, therefore, forming their own
independent unions, which are not part of national trade union centers. Thus traditional
party based unions found their potential recruitment challenged and curtailed. Further,



bargaining is becoming increasingly fragmented; there is a shift towards enterprise
bargaining (ILO, 1999). Trade unions in the banking sector believe that the seventh
Bipartite Wage Negotiation might be the last signed settlement. The Indian banking
Association (IBA) wants bank-level wage settlements in the future. In another case, the
unions in the more profitable jute mills want to break away from the industry-wide
arrangement in force and set-up their own mill-level agreement. By decentralizing
bargaining structures and expanding the scope and duration of labors contracts,
employers and the governments are trying to minimize the monopoly effects of unions.
Enterprise based trade unions have also had to accept that their pay is determined by
productivity (Bhattacharjee, 1999).

However, in spite of being on the defensive, Indian trade unions face anti-union feeling
from the public (ILO, 1999). The unions, over the years, have lost the sympathy of the
general public. Strikes, called often, disrupt everyday life and cause inconvenience to the
masses (Sharma and Dayal, 1999). Consumer forum now asserts that no trade union has
the right to resort to illegal strike, in contravention of the mandatory perquisites, which
may result in grave and irreparable hardships, inconvenience and loss to the members of
the public. Thus, the basic dilemma faced by trade unions is the need to simultaneously
serve the interests of their members is being seen to serve the interests of society as a
whole. The challenges posed by the increasing globalisation of production, liberalization
of world trade, changing profile of workers, beside a shift in management strategies have
forced the labour movement to reassess its tactics. Unions, therefore, need to revive and
to redefine their role as sword of justice rather than conservative interest groups (Hyman,
1999).

INDIAN TRADE UNIONS BEYOND TOMORROW

The most important task before Indian trade unions today is to organize the unorganised.
There is a need for unions to coordinate the struggle of industrial workers with that of
rural laborers and widen workers’ struggles, which have remained confined to an
economic movement for wages. No serious effort has yet been made by national trade
unions to organize home-based and part-time workers in India, although there have been
a number of successful attempts at local level for instance, Self-Employed Women’s
Association (SEWA) in Ahmedabad (ILO, 1999) states that recruiting this vulnerable
section of society and defending, their interest is not a matter of doing good for those less
fortunate. It is matter of survival for the Indian trade union movement. It clearly is time
that the Indian trade union movement broke out of the confines of the organized sector
and made serious inroads into the unorganized workforce. A strong and broad based
labour movement is central to the development of wide and strong political agendas.

In keeping with what was just stated unions should aim at securing minimum income to
all in the labour market by establishing minimum standards of employment, wages,
working conditions and social security. Union strategies that bridge the gap between the
formal and informal sectors are central to the future of trade unions (Jose, 2000). In fact
the benefits of general union membership should not be lost when workers move into
non-unionized workplaces. In case of home-based teleworking, the entire area of



negotiations needs to include allowing employees to use office space when required, e-
mail and telephones links with other workers at the employer’s expense we. Further, to
ensure that teleworkers are not discriminated against office-based workers in terms of
benefits and emoluments, monitoring health and safety conditions and lastly, teleworkers’
right to organize through unions should be protected (Ghatoshkar, 2000).

The unions will have to seriously examine the possibility of mergers and combine their
resources to influence policy makers. They also need to develop linkages with trade
unions in other countries (Sharma and Dayal, 1999). To this effect, in the South Asian
region, labour organizations have come together under the banner of South Asian Labour
Forum. The forum members feel that this is the only way to negotiable the imposed
globalisation in the developing world. However, the “strained diplomatic relations
between some nations of the region”, and the apprehensive political atmosphere of the
South Asian countries do weaken such attempts (Hindu, 1996). Sharma and Dayal (1999)
predict that the links between political party and trade unions would weaken over a
period of time and unions may have to stand on their own. This may lead to new
alignments. This is very true of the HMS, which has undergone considerable changes
from its earlier political character largely because of the fragmentation of the socialist
movement tin the country. Woven the recent confrontation of the BMS at the 37th Indian
Labour Conference points in that direction. The loosening of ties with parent bodies does
lead to great autonomy in decentralized decision-making (Bhattacharjee, 1999).
However, it also reduces the economic strength and the political influences of the unions.
Governments feel less need to take account of their views, especially in a climate of
tough monetary discipline, curbs on public spending, privatization of utilities and public
enterprises, and deregulation of labour markets (ILO, 1999). Thus, unions need to grapple
with this change in political reality.

Unions could also strengthen their technical expertise so as to become valuable advisors
to workers ‘ representatives. They could set up “employee consultancies” helping
workers maintain their skills and expertise. They could provide information on job
opportunities, submit proposals for alternative employment, identify legal changes and
employer policies and equip employees to respond to the needs of different sectors and
occupations. In terms of the long-term viability of union organization members need to
be prepared for present and future work. Skill development processes need to be
organized that are critical to long-term economic security. Only then will people get
involved with unions. Unions might attract new members if they improve the services
they offer. This calls for a subtle combination of individual services and collective
representation. Unions can make unique contribution into the development of the
community through their contributions with such development institutions as consumer
cooperatives, housing societies, health funds and social security organization. However,
they need to improve their public image (Jose, 2000). Besides this, the labour movement
has very little capacity or ability to do detailed research on the core issues relating to
globalisation. This is party a resources constraint and party the result of low priority
placed upon such work. The labour movement urgently needs a body capital and willing
to carry out this research function (Evans, 1997).



As representative of a well-organized and articulate group in society, trade unions will
have to move into the broader terrain of defending economic and social rights. Sharma
and Dayal (1999) state that Indian trade unions operate within their own domain and do
not actively coordinate with other social groups or movements. Trade unions today face
the challenges of convincing the public that they can act on behalf of all employees,
unionized or not. This requires building alliances with community bodies, social
movements and NGOs which may require addressing concerns of communities, ethnic
groups, religious organizations and neighborhood association which lie beyond the realm
of the workplace (Jose, 2000). In so many areas like child labour, human rights and the
environment, the NGOs have been far ahead of the trade union movement. For instance
even the international labour movement is nowhere near the power and influence of the
international environment movement. Pressure from the environment all obey has shaped
much of the WTO agenda on the environment. Lessons must be learnt from these groups.
Alliances must also be forged with other progressive groups working in the trade field on
issues of shared importance (Evans, 1997). Instead of bemoaning or complaining that
NGOs indulge in some under hand dealings to get money, trade unions need to carefully
study NGOs, and wherever possible ally with them. One instance of this is the
international Transport Workers Federation (ITF), which has a very good relationship
with Green peace, the well known environmental group, on issues such as marine
pollution and the toxic waste trade (Smith, 1999). Union movement in alliance with
environment and people’s organization will be able to deal with the onslaught of
globalisation and repression that it brings. Therefore unions will have to take the public
along. When they want to defend their right on exclusive economic interest where
workers interest are in conflict with those of society. They should be viewed as efficient
providers of services to their constituents and the public at large (Jose, 2000). They
should act as a true social partner, helping people outside the workplace and voicing their
concerns collectively. The unions should consider themselves as instrument of society
and should strengthen society and not just its members in isolation (Sharma and Dayal,
1999).

Indian unions are also confronted with the low participation of rank and file membership.
General body meetings are poorly attended except when it comes to wages, bonus,
festival payments or some other financial benefits. The workers regard unions in
instrumental terms. Therefore the decision-making will have to be democratic (Sharma
and Dayal 1999). The changing profile of workers has given impetus to individualism,
coupled with new strategies to make employees identify more closely with the company.
Trade unions have to adapt their structure and strategies in order to represent workers in
the new environment. The simple notion of solidarity is now outdated, a modernized
concept has to encompass the mutual support of those whose positions and interest are
different (Zoll, 1996). This traditional view of solidarity wherein trade union members
perceive a common interest is in constant conflict with individualization. It has to take
into account individualism “ Diversity is not primarily to be a faced by starting from a
postulated units, but starting from diversity, one should look for concrete differences and
similarities and develop differentiated views of solidarity from them. (Valkenburg, 1996).
This is the need of the hour given the fragmented nature of Indian trade unions today.



Moreover, the bureaucratic – hierarchical model has led to alienation and
disentanglement among trade union members. The role of trade unions official should no
longer be a universal expert but a facilitator. It implies a reorganization of trade union
activity away from bureaucratic, administrative and control towards collaborative project
work. This means that the dominance of paid officials should disappear and the
knowledge and competence of members are at least equivalent. Participation can no
longer be viewed exclusively in the context of general central policy. The traditional
approach is to mediate from above; such a formula satisfies no one. An alternative
modern approach is to initiate a dialogue between groups involved and helping them to
reach an agreement rather than improving it from above. In recent years European unions
have searched for alternative organization experiments with networks, working groups
and circles becoming increasingly common and have built an organic link between
leaders, activists and ordinary members (Hyman, 1996; Zoll, 1996). This could also be
tried in India with the profile of workers undergoing a change. Besides this, the new
communications technologies-in particular web-based conferencing, software and video
conferencing-seem to offer the possibility of strengthening the transactional institutions
of the labour movement as well as the national ones by allowing groups to meet regularly
at practically no cost. This would make trade unions more attractive, more democratic
and more powerful (Lee, 1998). Though this seems to have limited applicability in the
Indian context a way of using these technologies in India needs to be considered.

It is a man’s world when it comes to union leadership (Sharma and Dayal, 1999). Union
should pay special attention to previously under-represented groups, such as women and
minorities, within union structures and in promoting the interest of these groups
(especially concerning gender issues) in the workplace. For instance, since the decision in
the case of Vishaka V/s state of Rajasthan and others in 1997 unions should take up
sexual harassment cases more vigorously. Unions in western countries attempt to
reconcile the interests of the diverse groups by establishing separate committees or
groups to represent different categories of workers, or by including representatives of
these workers in the machinery of the union (ILO, 1999). The case for organizing women
separately is strongly advocated to avoid the marginalisation of women’s concerns and to
reconcile the competing interest of various groups.

Lastly, a competitive edge will decide the survival of the organization. Up gradation of
technology, product innovation, quality and low cost are required for survival. The union
will have to collaborate rather than be adversarial in approach: only this will help them to
survive in the long run. The collective bargaining agenda needs to be expanded to include
the future of each industry. At the local level, unions should approach management with a
suggestion to sit together to chalk out a joint plan for saving the company (Smith 1999).

To conclude, Hyman (1999) states, “to resist the hostile forces ranged against them,
unions must mobilize countervailing power resources; but such resources consist in the
ability to attract members, to inspire membe4rs and sympathizers to engage in action, and
to win the support (or at least neutrality) of the broader public. The struggle for trade
union organisaion is thus a struggle for the hearts and minds of people; in other words, a
battle of ideas”.



Definition of Trade Union

Section 2 (h) of the Trade Unions Act, 1926 has
defined a trade union as
“Any combination, Whether temporary or
permanent, formed primarily for the purpose of
regulating the relations between workmen and
employers,or between workmen and workmen, or
between employers and employers, or for
imposing restrictive conditions on the conduct of
any trade or business, and includes any
federation of two or more trade unions.”



Objectives
• Better Wages
• Better Working conditions
• Bonus
• Resist unsuitable schemes
• Secure welfare
• Project Interests of workers
• Social Welfare
• Organisational growth and stability

Functions
• Militant
• Fraternal



Criticism of Trade Unions by
Employers
• Lack of education
• May not welcome change
• Strike on Illogical basis
• Creation of Artificial scanity of labour
• Undue demands relating to wages

Motivation to Join Unions
• Greater Bargaining Power
• Make their voices heard
• Minimise discrimination
• Sense of security
• Sense of participation
• Sense of Belongingness



Structure of Trade Unions
• Plant Level Federations
• Local level federations
• Regional level federations
• National level federations

Problems and Weaknesses of
Trade Unions:
• Uneven growth
• Limited membership
• Multiplicity of unions
• Outside leadership
• Financial problems
• Indifferent Attitude of workers



Suggestions for Healthy growth of
Unions
• One Union Per Industry
• Paid Union Officials
• Development of Internal Leadership
• Recognition of Trade Unions
• Improved Financial condition

Trade Unions

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