Aspects of Industrial Relations

Industrial Relations or Labour Relations is an expression used not only for relationships between employers and Trade Unions, but also for those involving Government with the aim of defining policies, facing labour problems. The concept of industrial relations has a very wide meaning and connotation. In the narrow sense, it means that the employer, employee relationship confines itself to the relationship that emerges out of the day to day association of the management and the labour.

In its wider sense, industrial relations include the relationship between an employee and an employer in the course of 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. Handy, (1993) Thus an industrial relations system consists of the whole gamut of relationships between employers and 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 and employees (and their representatives) on the one hand, and between them and the State on the other, are more harmonious and cooperative than conflictual and creates an environment conducive to economic efficiency and the motivation, productivity and development of the employee and generates employee loyalty and mutual trust.

The essay with a help of relevant examples explains the role of industrial relations actors. Ellem, (2004) Actors and their roles in industrial relations

Three main parties are directly involved in industrial relations: That is employers, Trade unions and the government. 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 the factory or to introduce technological changes.

Employers and management are increasingly seen as the driving force behind the development and transformation of national industrial. Industry management on behalf of employers is one of two key players in the realm of industrial relations. Top-level management must communicate and negotiate with employee organizations to avoid strikes, law-suits and protests.

This level of management interacts with employee organizations on a large-scale, as opposed to lower tiers of management which mostly rely on human resources to conduct employee interactions. Low-level (or local) management interacts with employees on an individual basis (often through a human resources department). All levels of management are involved in industrial relations, but low-level management has little or no say in big-picture decisions (employee compensation and benefit alterations).

In an industrial relations negotiation, management represents the interest of the company (and shareholders if applicable). Management must work with employees to develop compensation packages and policies that are acceptable for both parties.

When the relationship between management and employees sour, management may be forced to develop a crisis-management plan. If an employee organization initiates a large-scale strike or protest, management must act quickly (either give-in to employee demands or find an alternate solution) to avoid crippling profit losses. Handy, (1993) Historically, management is depicted as a foe of employees and their organizations.

While this stereotype is not entirely true, the media often portrays management as the "bad guy" of the two organizations (unions are usually cast as the hero of the "little guy"). This negative media attention (and historical stereotype) can lead to extremely damaging public relations, which can eventually cripple an entire industry. Trade unions

Workers seek to improve the terms and conditions of their employment. They exchange views with management and voice their grievances. They also want to share decision making powers of management. Workers generally unite to form unions against the management and get support from these unions.

A Trade Union is 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 union .Ellem, (2004).

The role of trade unions and their representatives 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 of trade union. Although trade unions look after the interests of their members, they also recognize the advantages of working in partnership with employers. This is because a successful, profitable business is good for workers and therefore good for the union and its members.

An employer and a recognized trade union interact with the workplace in a number of ways, as set out below. Shaw (1996) Negotiating collective agreements: If you recognize a trade union in your workplace, you will probably have agreed with the union to bargain with it about the terms and conditions of employment of those workers who fall within a defined bargaining unit. Sometimes, that bargaining unit will include all workers but it is common for the unit to include just certain categories of worker, like production line operatives or technicians.

The objective of such collective bargaining is to conclude a collective agreement with the trade union. Where an independent trade union is recognized, the employer is obliged to disclose information to the trade union to facilitate the bargaining process. A collective agreement is between a recognized trade union (or group of unions) and an employer (or groups of employers).

Most typically, they set out the terms and conditions for example to pay, benefits and working time – to be included in the employment contracts of the workers in the bargaining unit. Other collective agreements are purely procedural and regulate the working relationship between the union(s) and the employer(s). Cole (2002) Informing and consulting: Under certain circumstances, you must inform – and consult with – representatives of a recognized trade union about: •Collective redundancies.

•Transfers of business ownership. •Occupational and personal pension schemes. •Health and safety. However, you could enter a voluntary agreement with a trade union to inform and consult the union about broader business and workplace issues on a regular, ongoing basis. The union may want to set up a joint consultative committee specifically for this purpose. Representing workers at disciplinary and grievance hearing: Employees and other workers have the right to be accompanied at a disciplinary or grievance hearing. They can choose to be accompanied by a co-worker or a union official.

Often, the union official will be a workplace representative who is also a co-worker. Shaw, (1996) In all trade unionism is a means for workers to liberate themselves from poverty and social exclusion. Workers use trade unions as their representative voice to demand their rights and improve their living and working conditions. The formation of trade unions was a reaction against the mechanisms of pauperisation, notably: low pay, long working hours, child labour and generally appalling working condition.

Government The central and state government influences and regulates industrial relations through laws, rules, agreements, and awards of court. It also includes third parties and labor and tribunal courts. Every elected government of the country has as its bounden duty to secure upliftment of all citizens and to that extent the constitution provides for rules and regulations through a system of laws that would facilitate progress, redress of grievances and thereby would maintain peace and harmony in the society. Cole (2002).

As regards to labour while the State is committed to promote industrial growth through bilateral relations between employers and employees for mutually healthy existence, cooperation and progress, the state is not oblivious to the fact that despite best intentions and efforts, sometimes the issues between the parties may not get resolved at bilateral level and unless a way or resolve is sanctified through the constitution of the country and the system of law, there would be impediments to progress and the expected peace and harmony may get vitiated.

Against this backdrop, it is simple to accept and appreciate that the State has reserved a role of an "Umpire or a Referee" in the game of industrial relations. It provides all kinds of mechanisms to parties through law to resolve their own problems bilaterally and has further taken care to provide a quasi judicial/judicial system for determination of disputes.

But the idea essentially is excellent in the State becoming an Umpire and to help parties become mature in resolving problems amongst themselves. Handy, (1993) Thus the government's role in industrial relations is vitally important to the economy and establishes a relationship between employers and trade unions in the following ways. Laws: The government establishes laws that must be abided in the workplace. Some of these include taxation, federal minimum wage and child labor laws. Regulations: In an industrial work setting, many hazards present themselves to workers.

One of the most effective watchdogs between the government and the employer is the Occupational Safety & Health Administration. Safety regulations mandated by the government are policed through this organization. In all the role of government is to see to it that the two social partners do not destroy the common good or go out of bounds of commonly agreed policies or, even more precisely, to promote an environment where free collective bargaining can operate. In most cases the first thing government aims to ensure a level playing field and a more or less a symmetric power relations between and among the parties to a social partnership. Shaw, (1996)

In conclusion it can be stated the three actors of industrial relations each play important role in promoting the common good and in the process they find a nexus for promoting the greater common good. The impact of all these efforts in promoting industrial peace cannot be traced directly nor measured precisely. But the fact that the partners are promoting social dialogue to arrive at consensus and compromises helps to create understanding and cooperation between and among them, that can be the basis for a more stable and peaceful industrial relations.


  • Cole, G.A (2002) Personnel and Human Resource Management London: Thomas Rennie
  • Handy, C.B (1993) Understanding Organizations Annex: Peguin
  • Ellem, B. (2004) Hard Ground: Unions in the Pilbara, Port Hedland: Pilbara ltd
  • Shaw, J. (1996) A balanced industrial relations reform New South Wales:
  • Stewart A. (1998), The Australasian Labour Law Reforms Sydney: The Federation Press.