Industrial Relations and Labour Welfare

 

 

 

 

INTRODUCTION CONCEPT OF INDUSTRIAL RELATIONS TRADE UNION AND ITS IMPORTANCE TREND IN NUMBER OF REPORTING FACTORIES – EMPLOYMENT TRADE UNION – CONCEPT 1.5.1 A few commonly cited definitions trade union are 1.5.2 General Features of Trade Unions 1.5.3 Functions of Trade Unions GROWTH AND DEVELOPMENT OF THE TRADE UNION MOVEMENT 1.6.1 Social Welfare period, from 1875 to 1918 1.6.2 Early Trade Union period, from 1918 to 1924 1.6.3 Left-wing Trade Unionism period, from 1924 to 1934 1.6.4 Trade Unions’ Unity period - 1935 to 1938 1.6.5 Second World War period - 1939 to 1945 1.6.6 Post – independence period - 1947 to 2000 FUNCTIONS OF TRADE UNIONS FUNCTIONS OF TRADE UNIONS IN INDIA TYPES AND STRUCTURE OF TRADE UNIONS 1.9.1 The Union Classified According to Purpose 1.9.2 Union Classified on the Basis of Membership Structure CRAFTS VERSUS INDUSTRIAL UNIONS ALL INDIA CENTRAL COUNCIL OF TRADE UNIONS (AICCTU) 1.11.1 Aims and Objectives

CODES OF CONDUCT – TRADE UNIONS 1.12.1 Labour conditions in India 1.12.2 The possible effects of CCC 1.12.3 General conclusions 1.12.4 About every meeting some distinct remarks were made ix

1 1 13 13 15 15 16 19 20 21 22 23 23 23 24 25 26 29 29 31 33 34 35 36 37 38 39 39

1.13

1.14

THE INDIA COMMITTEE OF THE NETHERLANDS (ICN) 1.13.1 Organisation 1.13.2 Awareness Raising 1.13.3 Campaigns 1.13.4 Social labels and codes of conduct 1.13.5 Co-operation CONCLUSION

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UNIT II INDUSTRIAL CONFLICTS 2.1 2.2 2.3 2.4

2.5 2.6

2.7

2.8

INTRODUCTION INDUSTRIAL DISPUTE CERTAIN ASPECTS OF INDUSTRIAL DISPUTES ARE DISCUSSED AS BELOW GOVERNMENT MACHINERY TO RESOLVE INDUSTRIAL DISPUTES 2.4.1 Introduction 2.4.2 A. Conciliation 2.4.3 B. Arbitration 2.4.4 C. Adjudication MEDIATION 2.5.1 Kinds of Mediator CONCILIATION 2.6.1 Qualities of Conciliator 2.6.2 Role of the Conciliator 2.6.3 Sequential Pattern of Conciliation ARBITRATION 2.7.1 Concept 2.7.2 Types of Arbitration REFERENCE OF DISPUTE TO ARBITRATION UNDER INDUSTRIAL DISPUTES ACT, 1947 2.8.1 Qualification of Arbitrators 2.8.2 Procedure for Investigation 2.8.3 Submission of Award 2.8.4 Criticism of Compulsory Arbitration x

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59 59 60 61 62 64 66 66 67 68 69 69 70 70

2.9 2.10

2.11 2.12 2.13

2.8.5 National Arbitration Promotion Board ADJUDICATION 2.9.1 Types of Adjudication INDUSTRIAL TRIBUNALS 2.10.1 Constitution 2.10.2 Jurisdiction 2.10.3 National Tribunals MODEL PRINCIPLES FOR REFERENCE OF DISPUTES TO ADJUDICATION COMMENCEMENT AND CONCLUSION OF PROCEEDINGS Central Industrial Relations Machinery in India

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UNIT III LABOUR WELFARE 3.1 3.2 3.3

3.4 3.5 3.6

3.7 3.8

3.9

INTRODUCTION WELFARE AND WORKING CONDITIONS IMPORTANCE OF LABOUR WELFARE 3.3.1 A – Labour 3.3.2 B –Training 3.3.3 C – Employment 3.3.4 D - Special Employment Scheme WELFARE MEASURES – VOLUNTARY STATUATORY WELFARE MEASURES

NON-STATUTORY WELFARE MEASURES 3.6.1 Non-statutory Welfare in Indian Industry: Some Examples 3.6.2 Comments on Non-Statutory Welfare 3.6.3 Non-Statutory Welfare: A Model WORK ENVIRONMENT 3.7.1 Arousal Hypothesis LABOUR WELFARE FUNDS 3.8.1 Tripartite Labour Welfare Fund Advisory Committee 3.8.2 Conclusion WORKER’S EDUCATION AND TRAINING SCHEMES 3.9.1 Worker’s Education: Concept xi

79 80 80 81 82 88 88 88 90 94 94 94 95 98 100 101 101 103 104 104

3.10

3.11

3.9.2 Objective of Workers’ Education 3.9.3 Techniques of Workers Education 3.9.4 Workers’ Education in India 3.9.5 The Scheme for Workers’ Education 3.9.6 Three Levels of Workers’ Education 3.9.7 Special Category Programmes WORKERS’ TRAINING: CONCEPT 3.10.1 Training Schemes of DGET EVALUATION OF THE TRAINING SCHEMES

105 106 106 107 108 109 111 112 116

UNIT – IV INDUSTRIAL SAFETY 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11

4.12 4.13 4.14

INTRODUCTION FEATURES OF SAFETY ORGANIZATION SAFETY COMMITTEES ACCIDENT PREVENTION PROGRAMME ROLE OF SAFETY DIRECTOR STATUTORY SAFETY PROVISIONS WORKERS’ HEALTH 4.7.1 Statutory Health Measures HAZARDOUS PROCESSES STATUTORY REQUIREMENTS FOR HAZARDOUS MANUFACTURING PROCESS OCCUPATIONAL HAZARDS 4.10.1 Match and firecracker industry in Sivakasi, Tamilnadu OCCUPATIONAL HEALTH PROBLEMS 4.11.1 Gem polishing Industry, Jaipur, Rajshtan 4.11.2 Hand made Carpet Weaving Industry, Mirzapur & Bhadoi, Uttarpradesh MENTAL HEALTH PROBLEMS 4.12.1 Slate - Stone Mines and Industry NOTIFIABLE DISEASES PSYCHOLOGICAL COUNSELLING 4.14.1 Councelling Methodology 4.14.2 Employment settings xii

119 120 120 121 121

121 131 131 136 141 145 146 146 146 147 148 148 149 152 153 154

UNIT – V WELFARE OF SPECIAL CATEGORIES OF LABOUR 5.1 5.2 5.3 5.4 5.5

5.6

CHILD LABOUR 5.1.1 Constitutional Rights of a Child THE CHILD LABOUR (PROHIBITION AND REGULATION) ACT, 1986 INITIATIVES TOWARDS ELIMINATION OF CHILD LABOUR – ACTION PLAN AND PRESENT STRATEGY FOCUSING OF GENERAL DEVELOPMENTAL PROGRAMMES

FOR BENEFITING CHILD LABOUR THE COVERAGE OF THE NCLP SCHEME HAS INCREASED FROM 12 DISTRICTS IN 1988 TO 100 DISTRICTS IN THE 9TH PLAN TO 250 DISTRICTS DURING THE 10TH PLAN. THE CONTRACT LABOUR (REGULATION AND ABOLITION) ACT, 1970

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UNIT I

INDUSTRIAL RELATIONS Learning Objectives After going though this unit you should be in a position to explain the following terminologies: • Concept of Industrial Relations • Importance of IR • Labour Turnover • Absenteeism • Trade Union • Codes of Conduct 1.1 INTRODUCTION Industrial relations has become one of the most delicate and complex problems of modern industrial society. Industrial progress is impossible without cooperation of labours and harmonious relationships. Therefore, it is in the interest of all to create and maintain good relations between employees (labour) and employers (management). 1.2 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 the employer and his workmen.”

The term industrial relations explain the relationship between employees and management which stem directly or indirectly from union-employer relationship. Industrial relations are the relationships between employees and employers within the organizational settings. The field of industrial relations looks at the relationship between management and workers, particularly groups of workers represented by a union. Industrial relations are basically the interactions between employers, employees and the government, and the institutions and associations through which such interactions are mediated.

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The term industrial relations have a broad as well as a narrow outlook. Originally, industrial relations were broadly defined to include the relationships and interactions between employers and employees. From this perspective, industrial relations covers all aspects of the employment relationship, including human resource management, employee relations, and union-management (or labour) 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 labour-management relations, while human resource management is a separate, largely distinct field that deals with nonunion employment relationships and the personnel practices and policies of employers. The relationships which arise at and out of the workplace generally include the relationships between individual workers, the relationships between workers and their employer, the relationships between employers, the relationships employers and workers have with the organizations formed to promote their respective interests, and the relations between those organizations, at all levels. Industrial Relations also includes the processes through which these relationships are expressed (such as, collective bargaining, workers’ participation in decision-making, and grievance and dispute settlement), and the management of conflict between employers, workers and trade unions, when it arises. The industrial situation as reflected in the statement of mandays lost on account of strikes and lockouts has shown improvement in recent years. Despite increase in the number of strikes and lockouts in 1997 compared to 1996, the mandays lost due to these agitations have actually declined. The total number of strikes and lockouts increased from 1166 in 1996 to 1305 in 1997, but the mandays lost on account of these strikes and lockouts declined from 20.3 million in 1996 to 17 million in 1997 (Table 1.1). Among the states, Andhra pradesh, Tamil Nadu, Gujarat and West Bengal recorded most of the agitations. Cotton textiles, engineering and jute hemp and Mesta textiles were the industrial groups which witnessed maximum loss of mandays on account of strikes and lockouts. Wage and wage related issues, personnel issues, retrenchment and indiscipline have been identified as major reasons behind strikes and lockouts. Protests against privatization and entries of multinationals are issues that have gained importance in recent years. The steady improvement in industrial relations has been possible mainly because of the Government’s proactive role through timely and effective conciliation of industrial disputes and involvement of the social partners at various bipartite-tripartite fora for the formulation of labour and industrial policies. One important issue, which needs to be addressed, is the extant labour laws especially Industrial Disputes Act (IDA) 1947, which governs lay off, retrenchment and closure. Central and State Governments have often been inhibited in granting necessary permissions for closure, even when economic compulsions justified granting of such permissions. It has often been observed that the present legal provisions and procedures restrict labour market flexibility and thereby discourage growth of employment. A thorough review of the provisions of the IDA and other labour legislations 2

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is called for to impart greater flexibility to the labour market and thereby encourage more employment.

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Considering the radical changes that have taken place in the domestic industrial scenario and the labour market, the Government has decided to set up the Second National Commission on Labour to suggest among others, rationalization of the existing laws in the organized sector so as to make them more relevant and appropriate in the changing context of globalization and opening up of the Indian economy.

MEANING AND DEFINITION OF INDUSTRIAL RELATION The relationship between Employer and employee or trade unions is called Industrial Relation. Harmonious relationship is necessary for both employers and employees to safeguard the interests of the both the parties of the production. In order to maintain good relationship with the employees, the main functions of every organization should avoid any dispute with them or settle it as early as possible so as to ensure industrial peace and higher productivity. Personnel management is mainly concerned with the human relation in industry because the main theme of personnel management is to get the work done by the human power and it fails in its objectives if good industrial relation is maintained. In other words good Industrial Relation means industrial peace which is necessary for better and higher productions.

Other commonly referred definitions: i. Industrial Relation is that part of management which is concerned with the manpower of the enterprise – whether machine operator, skilled worker or manager. ii. Industrial Relation is a relation between employer and employees, employees and employees and employees and trade unions. - Industrial dispute Act 1947 iii. While moving from jungle of the definitions, here, Industrial Relation is viewed as the “process by which people and their organizations interact at the place of work to

Establish the terms and conditions of employment.” The Industrial Relation relations also called as labor - management, employee-employers relations. A few notable features pertaining to Industrial Relations are as under: 1. Industrial Relation do not emerge in vacuum they are born of employment relationship in an industrial setting. Without the existence of the two parties, i.e., labour and management, this relationship cannot exist. It is the industry, which provides the environment for industrial relations.

2. Industrial Relation are characterized by both conflict and co-operations. This is the basis of adverse relationship. So the focus of Industrial Relations in on the study of the attitudes, relationships, practices and procedure developed by the contending parties to resolve or at least minimize conflicts. 3

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3. As the labor and management do not operate in isolations but are parts of large system, so the study of Industrial Relation also includes vital environment issues like technology of the workplace, country’s socio-economic and political environment, nation’s labor policy, attitude of trade unions workers and employers. 4. Industrial Relation also involve the study of conditions conductive to the labor, managements co-operations as well as the practices and procedures required to elicit the desired co-operation from both the parties.

5. Industrial Relations also study the laws, rules regulations agreements, awards of courts, customs and traditions, as well as policy framework laid down by the governments for eliciting co-operations between labor and management. Besides this, it makes an in-depth analysis of the interference patterns of the executive and judiciary in the regulations of labor–managements relations. In fact the concepts of Industrial Relations are very broad-based, drawing heavily from a variety of discipline like social sciences, humanities, behavioral sciences, laws etc.

Industrial Relation encompasses all such factors that influence behavior of people at work. A few such important factors are details below: 1. Institution: It includes government, employers, trade unions, unions’ federations or associations, government bodies, labor courts, tribunals and other organizations which have direct or indirect impact on the industrial relations systems. 2. Characters : It aims to study the role of workers unions and employers’ federations officials, shop stewards, industrial relations officers/ manager, mediator/conciliators / arbitrator, judges of labor court, tribunal etc.

3. Methods : Focus on collective bargaining, workers’ participation in the Industrial Relation schemes, discipline procedure, grievance re-dressal machinery, dispute settlements machinery working of closed shops, union reorganization, organizations of protests through methods like revisions of existing rules, regulations, policies, procedures, hearing of labor courts, tribunals etc.

4. Contents : Includes matter pertaining to employment conditions like pay, hours of works, leave with wages, health, and safety disciplinary actions, lay-off, dismissals retirements etc., laws relating to such activities, regulations governing labor welfare, social security, industrial relations, issues concerning with workers’ participation in management, collective bargaining, etc.,

Objectives of Industrial Relation: A. To safeguard the interest of labor and management by securing the highest level of mutual understanding and good-will among all those sections in the industry which participate in the process of production.

B. To avoid industrial conflict or strife and develop harmonious relations, which are an essential factor in the productivity of workers and the industrial progress of a country. 4

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C. To raise productivity to a higher level in an era of full employment by lessening the tendency to high turnover and frequency absenteeism.

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D. To establish and nurse 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.

E. To eliminate, as far as is possible and practicable, strikes, lockouts and gheraos by providing reasonable wages, improved living and working conditions, said fringe benefits. F. To establish government control of such plants and units as are running at a loss or in which productions has to be regulated in the public interest. G. Improvements in the economic conditions of workers in the existing state of industrial managements and political government.

H. Control exercised by the state over industrial undertaking with a view to regulating production and promoting harmonious industrial relations. I. Socializations or rationalization of industries by making he state itself a major employer J. Vesting of a proprietary interest of the workers in the industries in which they are employed. The main aspects of Industrial Relations are:i.

Labor Relations, i.e. relations between union and management

ii. Employer-employees relations, i.e. relations between management and employees iii. Group relations, i.e. relations between various groups of workmen iv. Community or Public relations, i.e. relations between industry and society. v. Promotions and development of healthy labor-managements relations. vi. Maintenance of industrial peace and avoidance of industrial strife vii. Development of true industrial Democracy

Effects of poor Industrial Relations Poor Industrial Relation produces highly disquieting effects on the economic life of the country. We may enumerate the ill-effects of poor Industrial Relations as under: 1.

Multiplier effects: Modern industry and for that matter modern economy are interdependent. Hence although the direct loss caused due to industrial conflict in any one plant may not be very great, the total loss caused due to its multipliers effect on the total economy is always very great.

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2.

Fall in normal tempo: Poor Industrial Relations adversely effect the normal tempo of work so that work ar below the optimum level. Costs build up. Absenteeism and labor turnover increase. Plants discipline breaks down and both the quality and quality of production suffer.

3.

Resistance of change: Dynamic industrial situation calls for change more or less continuously. Methods have to be improved. Economics have to be introduced. New products have to be designed, produced and put in the market. Each of these tasks involves a whole chain of changes and this is resisted bitterly if these are industrial conflict.

4.

Frustration and social cost: Every man comes to the work place not only to earn a living. He wants to satisfy his social and egoistic needs also. When he finds difficulty in satisfying these needs he feels frustrated. Poor Industrial Relations take a heavy toll in terms of human frustration. They reduce cordiality and aggravate social tension.

Suggestions to Improve Industrial Relation a. Both management and unions should develop constructive attitudes towards each other b. All basic policies and procedures relating to Industrial Relation should be clear to everybody in the organization and to the union leader. The personnel manager must make certain that line people will understand and agree with these policies. c. The personnel manager should remove any distrust by convincing the union of the company’s integrity and his own sincerity and honesty. Suspicious, rumors and doubts should all be put to rest.

d. The personnel manager should not vie with the union to gain workers’ loyal to both the organization. Several research studies also confirm the idea of dual allegiance. There is strong evidence to discard the belief that one can owe allegiance to one group only.

e. Management should encourage right kind of union leadership. While it is not for the management to interfere with union activities, or choose the union leadership, its action and attitude will go a long way towards developing the right kind of union leadership. “Management gets the union it deserves” is not just an empty phrase. Managements

IMPORTANCE OF INDUSTRIAL RELATIONS: The healthy industrial relations are key to the progress. Their significance may be discussed as under – 1.

Uninterrupted Production The most important benefit of industrial relations is that this ensures continuity of production. This means, continuous employment for all from manager to workers. The resources are fully utilized, resulting in the maximum possible production. There 6

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is uninterrupted flow of income for all. Smooth running of an industry is of vital importance for several other industries; to other industries if the products are intermediaries or inputs; to exporters if these are export goods; to consumers and workers, if these are goods of mass consumption.

2.

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Reduction in Industrial Disputes Good industrial relation reduces the industrial disputes. Disputes are reflections of the failure of basic human urges or motivations to secure adequate satisfaction 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 do not spring up in an atmosphere of industrial peace. It helps promoting co-operation and increasing production.

3.

4.

5.

6.

High morale Good industrial relations improve the morale of the employees. Employees work with great zeal with the feeling in mind that the interest of employer and employees is one and the same, i.e. to increase production. Every worker feels that he is a coowner of the gains of industry. The employer in his turn must realize that the gains of industry are not for him along but they should be shared equally and generously with his workers. In other words, complete unity of thought and action is the main achievement of industrial peace. It increases the place of workers in the society and their ego is satisfied. It naturally affects production because mighty co-operative efforts alone can produce great results.

Mental Revolution The main object of industrial relation is a complete mental revolution of workers and employees. The industrial peace lies ultimately in a transformed outlook on the part of both. It is the business of leadership in the ranks of workers, employees and Government to work out a new relationship in consonance with a spirit of true democracy. Both should think themselves as partners of the industry and the role of workers in such a partnership should be recognized. On the other hand, workers must recognize employer’s authority. It will naturally have impact on production because they recognize the interest of each other.

New Programmes New programmes for workers development are introduced in an atmosphere of peace such as training facilities, labor welfare facilities etc. It increases the efficiency of workers resulting in higher and better production at lower costs. Reduced Wastage

Good industrial relations are maintained on the basis of cooperation and recognition of each other. It will help increase production. Wastages of man, material and machines are reduced to the minimum and thus national interest is protected.

Thus, from the above discussion, it is evident that good industrial relation is the basis of higher production with minimum cost and higher profits. It also results in increased efficiency of workers. New and new projects may be introduced for the welfare of the workers and to promote the morale of the people at work.

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An economy organized for planned production and distribution, aiming at the realization of social justice and welfare of the massage can function effectively only in an atmosphere of industrial peace. If the twin objectives of rapid national development and increased social justice are to be achieved, there must be harmonious relationship between management and labor.

DIFFERENCE BETWEEN INDUSTRIAL RELATIONS AND HUMAN RELATIONS: The term “Industrial Relations” is different from “Human Relations”. Industrial relations refer to the relations between the employees and the employer in an industry. Human relations refer to a personnel-management policy to be adopted in industrial organizations to develop a sense of belongingness in the workers improves their efficiency and treat them as human beings and make a partner in industry.

Industrial relations cover the matters regulated by law or by collective agreement between employees and employers. On the other hand, problems of human relations are personal in character and are related to the behavior of worker where morale and social elements predominated. Human relations approach is personnel philosophy which can be applied by the management of an undertaking. The problem of industrial relations is usually dealt with a three levels – the level of undertaking, the industry and at the national level. To sum up the term “Industrial Relations” is more wide and comprehensive and the term “Human Relations” is a part of it.

Determining factors of industrial relations Good industrial relations depend on a great variety of factors. Some of the more obvious ones are listed below: 1.

History of industrial relations No enterprise can escape its good and bad history of industrial relations. A good history is marked by harmonious relationship between management and workers. A bad history by contrast is characterized by militant strikes and lockouts. Both types of history have a tendency to perpetuate themselves. Once militancy is established as a mode of operations there is a tendency for militancy to continue. Or once harmonious relationship is established there is a tendency for harmony to continue.

2.

Economic satisfaction of workers Psychologists recognize that human needs have a certain priority. Need number one is the basic survival need. Much of men conducted are dominated by this need. Man works because he wants to survive. This is all the more for underdeveloped countries where workers are still living under subsistence conditions. Hence economic satisfaction of workers is another important prerequisite for good industrial relations.

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3.

Social and Psychological satisfaction Identifying the social and psychological urges of workers is a very important steps in the direction of building good industrial relations. A man does not live by bread alone. He has several other needs besides his physical needs which should also be given due attention by the employer. An organization is a joint venture involving a climate of human and social relationships wherein each participant feels that he is fulfilling his needs and contributing to the needs of others. This supportive climate requires economic rewards as well as social and psychological rewards such as workers’ participation in management, job enrichment, suggestion schemes, re-dressal of grievances etc.

4.

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Off-the-Job Conditions An employer employs a whole person rather than certain separate characteristics. A person’s traits are all part of one system making up a whole man. His home life is not separable from his work life and his emotional condition is not separate from his physical condition. Hence for good industrial relations it is not enough that the worker’s factory life alone should be taken care of his off-the-job conditions should also be improved to make the industrial relations better.

5.

Enlightened Trade Unions The most important condition necessary for good industrial relations is a strong and enlightened labor movement which may help to promote the status of labor without harming the interests of management, Unions should talk of employee contribution and responsibility. Unions should exhort workers to produce more, persuade management to pay more, mobilize public opinion on vital labor issues and help Government to enact progressive labor laws.

6.

Negotiating skills and attitudes of management and workers Both management and workers’ representation in the area of industrial relations come from a great variety of backgrounds in terms of training, education, experience and attitudes. These varying backgrounds play a major role in shaping the character of industrial relations. Generally speaking, well-trained and experienced negotiators who are motivated by a desire for industrial peace create a bargaining atmosphere conducive to the writing of a just and equitable collective agreement. On the other hand, ignorant, inexperienced and ill-trained persons fail because they do not recognize that collective bargaining is a difficult human activity which deals as much in the emotions of people as in their economic interests. It requires careful preparation and top –notch executive competence. It is not usually accomplished by some easy trick or gimmick. Parties must have trust and confidence in each other. They must possess empathy, i.e. they should be able to perceive a problem from the opposite angle with an open mind. They should put themselves in the shoes of the other party and then diagnose the problem. Other factors which help to create mutual trust are respect for the law and breadth of the vision. Both parties should show full respect for legal and voluntary obligations and should avoid the tendency to make a mountain of a mole hill.

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7.

Public policy and legislation When Government, regulates employee relations, it becomes a third major force determining industrial relations the first two being the employer and the union. Human behavior is then further complicated as all three forces interact in a single employee relation situation. Nonetheless, government in all countries intervenes in management – union relationship by enforcing labor laws and by insisting that the goals of whole society shall take precedence over those of either of the parties. Government intervention helps in three different ways 1) it helps in catching and solving problems before they become serious. Almost every one agrees that it is better to prevent fires them to try stopping them after they start; 2) It provides a formalized means to the workers and employers to give emotional release to their dissatisfaction; and 3) It acts as a check and balance upon arbitrary and capricious management action.

8.

Better education With rising skills and workers’ education expectations in respect of rewards increases. It is a common knowledge that the industrial worker in India is generally illiterate and is misled by outside trade union leaders who have their own axe to grind. Better workers’ education can be a solution to this problem. This alone can provide worker with a proper sense of responsibility, which they owe to the organization in particular, and to the community in general.

9.

Nature of industry In those industries where the costs constitute a major proportion of the total cast, lowering down the labor costs become important when the product is not a necessity and therefore, there is a little possibility to pass additional costs on to consumer. Such periods, level of employment and wages rise in decline in employment and wages. This makes workers unhappy and destroys good industrial relations.

INDUSTRIAL RELATIONS PROGRAMME Today’s professional industrial relations director, or by whatever title he is designated, no longer views his job as personalizing management, or that of a social worker in a factory, or a union buster, he looks upon his department as an adjunct to management supervision at all levels; he keeps other executives informed about new discoveries, programme trends and needs. At the same time, he provides efficient service in the operation of several centralized services

A successful industrial relations programme reflects the personnel viewpoint, which is influenced by three main considerations: a. Individual thinking b. Policy awareness and c. Expected group reaction Individualized thinking makes if imperative for the administrator to consider the entire situation in which the affected individual is placed. Policy awareness underscores the idea 10

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of the consistency of treatment and the precedent value of any decision which a management takes; while expected group reaction balances what we know of human nature in groups against an individual’s situation in the light of the policy that has been formulated and implemented. In all these different circumstances, reality demands that all the three aspects of the personnel viewpoint should be considered at once in terms of the past, the present and the future. This viewpoint is held at all the levels of management from the top to the bottom, from the top executives and staff to the line and supervisory personnel.

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SCOPE OF INDUSTRIAL RELATIONS WORK: The staff employed in the industrial relations department should know the limitations within which it has to function. The industrial relations director generally has several assistants who help him to perform his functions effectively, and he usually reports directly to the president or chairman of the board of directors of an organization. The functions of the industrial relations staff are –

1. Administration, including overall organization, supervision and co-ordination of industrial relations policies and programmes. 2. Liaison with outside groups and personnel departments as well as with various cadres of the management staff. 3. The drafting of regulations, rules, laws or orders and their construction and interpretation. 4. Position classification, including overall direction of job analysis, salary and wage administration, wage survey and pay schedules.

5. Recruitment and employment of workers and other staff. 6. Employment testing, including intelligence tests, mechanical aptitude tests and achievement tests. 7. Placement, including induction and assignment. 8. Training of apprentices, production workers, foremen and executives. 9. Employee counseling on all types of personnel problems-educational, vocational, health or behavior problems. 10. Medical and health services. 11. Safety services, including first aid training 12. Group activities, including group health insurance, housing, cafeterial programmes and social clubs. 13. Suggestion plans and their uses in labor, management and production committees. 14. Employee relations, especially collective bargaining with representatives and settling grievances. 15. Public relations. 16. Research in occupational trends and employee attitudes, and analysis of labor turnover.

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17. Employee records for all purposes. 18. Control of operation surveys, fiscal research and analysis. 19. Benefit, retirement and pension programmes. FUNCTIONAL REQUIREMENTS OF A SUCCESSFUL INDUSTRIAL RELATIONS PROGRAMME The basic requirements on which a successful industrial relations programme is based are:a)

Top Management Support: Since industrial relations is a functional staff service, it must necessarily derive its authority from the line organization. This is ensured by providing that the industrial relations director should report to a top line authority to the president, chairman or vice president of an organization.

b)

Sound Personnel Policies: These constitute the business philosophy of an organization and guide it in arriving at its human relations decisions. The purpose of such policies is to decide, before any emergency arises, what shall be done about the large number of problems which crop up every day during the working of an organization. Policies can be successful only when they are followed at all the level of an enterprise, from top to bottom.

c)

Adequate Practices should be developed by professionals: In the field to assist in the implementation of the policies of an organization, a system of procedures is essential if intention is to be properly translated into action. The procedures and practices of an industrial relations department are the “tool of management” which enables a supervisor to keep ahead of his job that of the timekeeper, rate adjuster, grievance reporter and merit rater.

d)

Detailed Supervisory Training: To ensure the organizational policies and practices are properly implemented and carried into effect by the industrial relations staff, job supervisors should be trained thoroughly, so that they may convey to the employees the significance of those policies and practices. They should, moreover, be trained in leadership and in communications.

e)

Follow-up of Results: A constant review of an industrial relations programme is essential, so that existing practices may be properly evaluated and a check may be exercised on certain undesirable tendencies, should they manifest themselves. A follow up of turnover, absenteeism, departmental morale, employee grievances and suggestion; wage administration, etc. should be supplemented by continuous research to ensure that the policies that have been pursued are best fitted to company needs and employee satisfaction. Hints of problem areas may be found in exit interviews, in trade union demands and in management meetings, as well as in formal social sciences research.

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1.3 TRADE UNION AND ITS IMPORTANCE

NOTES

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 union 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 national integration 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 peace

1.4 TREND IN NUMBER OF REPORTING FACTORIES – EMPLOYMENT Absenteeism & Labour Turnover, Average Labour Cost and Average Wages/Salaries of Employees Sl. No. Parameters —————————————————

Year

2000 – 01 2001-02 2002-03 2003-04 2004-05 ————————————————————————————————— 1. No. of Reporting Factories

128339

125834 125834 125844 136356

2. Average Daily Employment a. All Employees

7988233

7751095 7935948 7870081 8453624 13

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b. All Workers

6135675 5958492 6161493 6086908 6599298

c. Male Workers

4000370 3771435 3809037 3695860 3863691

d. Female Workers

881171

e. Child Workers

666

f. Contract Workers

1253468 1297458 1422155 1495671 1748065

3. Absenteeism Rate (%) @

929745

306

10.08

889292

894992 987497

557

385

45

9.44

9.61

10.01

8.96

4. Labour Turnover a. Accession Rate (%) @

15.97

15.26

15.44

16.79

18.45

b. Separation Rate (%) @

17.16

17.43

16.57

18.11

16.94

5. Labour Cost on Employees per Manday Worked (Rs.)

256.45 271.96 285.05 305.89 307.76

6. Percentage of Labour Cost to Total Cost of Production

7.78

4.35

7.15

6.82

5.81

7. Percentage of Components of Labour Cost to Total Labour Cost a. Wages/Salaries

77.55

c. Provident Fund d. Welfare Expenses

76.40

77.95

4.19

4.12

4.11

4.29

12.30

11.93

12.12

10.31

7.25

10.75

76.59

4.44

b. Bonus

76.29

7.22

7.36

7.36

7.45

8. Wages/Salaries per Man-day Worked (Rs.) by a. All Employees

198.88

207.47

218.31

233.71

239.91

b. All Workers

148.86

152.38

158.75

165.55

168.58

c. Male Workers

180.02 187.84 197.85 207.72 212.30

d. Female Workers

78.45

79.13

82.17

87.33

91.00

e. Child Workers

55.63

38.78

61.87

51.57

28.86

f. Contract Workers

90.10

90.95

96.68

100.96

109.71

————————————————————————————————— —————— @ Among Directly Employed Regular Workers during the calendar year. NB: 1. Workers are defined to include all persons employed directly or through any agency, whether for wages or not, in any manufacturing process or in cleaning any part of machinery or premises used for manufacturing process or in any other kind of work, incidental to, or connected with the manufacturing process or the subject of manufacturing process. Labour engaged in repair and maintenance or production of fixed assets for factory’s own use or labour employed for generating electricity, etc. is also included.

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2. Employees include all workers and persons receiving wage/salary and holding supervisory or managerial positions engaged in administrative office, store keeping and welfare sections, sales department as also those engaged in purchase of raw materials, etc or purchase of fixed assets for the factory and watch and ward staff.

NOTES

1.5 TRADE UNION – CONCEPT The classic definition of trade union was given by Sidney and Beatrice Webb states that it is “a continuous association of wage earners for the purpose of maintaining and improving conditions of their working lives.” In their time, the brand to trade union organizations that existed was small and local representating a specific skill or trade. The definition refers to a “permanent organization” of workers rather than one which is created for a particular purpose and died later on. The term “wage earner” in its purview includes “salary –earns.” The objectives of such association is to maintain and improve the working conditions of its members

1.5.1 A few commonly cited definitions trade union are Dale Yoder, “A trade union is a continuous association of wage-earners for the purpose maintaining of improving the conditions of their working lives.” S.D. Puneker, A trade union is a monopolistic combination of wage-earners who as individual producers are complementary to one another but who stand to employers in a relation of dependence for the sale of their labour and production, and that the general purpose of association is in view of that dependence to strengthen their power to bargain with the employers of bargaining collectively.

However, for the sake of discussion, these definitions may sound good, but a legalistic definition of trade union is desirable in understanding its concept as prevalent in a particular society. This is because in the case of industrial dispute or on all union matter, on has to go by what the letter of laws says and not by what people perceive the union to be. The British Trade Union Act views it thus, “A trade union is a combination with the main objective of regulating the relation between workmen and masters or between workmen and workmen or between masters and masters for imposing of restrictive conditions on the conduct of any trade or business and also provision of benefits to members In the words of India Trade Union Act, 1926, “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, between employees 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.”

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This definition is defective because it allows even non-workers to form a trade union; also it is narrow and vague about the aims and purpose of forming such a union. Yet the definition with a clear and legal wording is certainly important in relation to getting a trade union registered with the Registrar of Trade Unions and when legal interpretation of trade union is required in the case of industrial disputes etc.

The characteristic which define a trade union includes i)

A Statement that the organization is a trade union.

ii) A Statement of its principal objectives, clearly specifying the fact that the organization formed is for the betterment of its members, i.e workers. iii) Registration with the Registrar of Trade Unions having jurisdiction on the area where Trade Union functions iv) Independence from the employer, which may be evident form the certificate issued by the Registrar of Trade Unions. v) Affiliation with the central trade union organization All the trade unions do not necessarily shown these characteristics, yet many of the large trade unions do. 1.5.2 General Features of Trade Unions Coming out of a vast array of literature on the subject, here a few general features trade unions are detailed out: (1) The trade union is an association either of employers or employees or of independent workers. Accordingly, in India such unions may consist of i. Merchant’s or employers’ associations (like the Employers’ Federation of India, the All-India Manufacturers’ Organisations, the All India Organisation of Industrial Employers, the Tea Planters’ Association of North India, the United Planters’ Association of South India, the Indian Jute Mills Association, the Indian Sugar Mills Association the Bombsy Mill Owners’ Association, and the Indian Paper Mills Association;

ii. The general labour unions iii. The friendly societies and iv. Combination of intellectual labour like (the All-India Teachers’ Association; the All-India Bank Employees’ Association; the All-India Medical Doctors’ Association; the Railway men’s Federation; National Federation of Posts and Telegraphs Workers; the All-India Mine Workers’ Federation etc.) On the other hand, in England, the term “trade union” also refers to the associations of professional persons such as artists’ federations, musicians’ union etc. In China, they refer to the trade union as an association of members of manual wageearners in enterprises, institutions schools and also working class engaged in irregular employments.

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In the erstwhile USSR, they were a mass non-party public organization which units on a voluntary basis, the workers and other employees of all occupations. They are really the masses of workers and others employees around the party which are mobilized for the struggle to build a communist society.”

NOTES

In USA, theses organizations are combinations of all persons in a given trade with the purpose of demanding and securing for each and all of them a definite minimum standard of wages, hours and conditions of works.

It may , however , be noted that all similar organizations cannot truly be regarded as trade unions, because the associations of employers are concerned with influencing the terms of purchase of services in favour of their members which they need for performing particular tasks. The associations of professional persons, too cannot be regarded as true trade unions because their main objectives are to improve the training and education of their members. Further, such associations include the self-employed as well as the employees. The trade union should, therefore, be regarded as an association only of workers or employees.

Thinkers like the Webbs, Cunnison and others do not recognize the employers’ associations and professional bodies as trade unions because they differ fundamentally from the workers’ organizations. They are of the view that if professional associations are treated as trade unions, a similar problem may arise for associations of sellers of services, like traveling and commission agents, bankers, insurance and property brokers and hotelowners, and to include them within the fold of the trade unions would be cumbersome and undesirable.

Sometimes, workers allow their employers to join their unions and vice versa. Such organization may be called trade combinations or mixed combinations as provided in the statutory provisions in Chile, France, Hungary and Romania. In India, such organizations have been referred to as quasi-unions.

(2) Labour unions are relatively permanent association of workers and are not temporary or casual: They persist throughout the years and conceive of their purpose as on which is not merely immediate but continues. They do not expect to attain their objectives in a day because they anticipate and contemplate continuing stream of additional objectives to be adopted from time to time. The most frequently used techniques by trade union is collective bargaining by which is meant the subordination of individual employer-employee relationships, in so far as the latter involve determination of wages and other conditions of employment-agreements affecting all workers in a group, arrived at by means of bargaining carried on not by workers themselves but by their union representatives.

(3) A Trade union is an association of workers who are engaged in securing economic benefits for its members: In other words it is essentially “a cooperative labour marketing association.” Its purpose is to secure control of the supply of labour in 17

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one or more markets and to maintain that control as a means of fixing the price of labour as well as the conditions under which it works. But this does not mean that the advancement of the economic interests of its members is the sole purpose of a trade union. As they also try to advance the social political and cultural complex co economic, legal, ethical and social problems, which can be understood and met only by knowing the facts and genesis of the viewpoint of organized labour in all its diversity, contradictions and shifting character and by considering this viewpoint in relation to developing social contradictions and social traditions. The trade unions of to-day are plurist in character and by so slowly changing environment. The traditional concept of trade union functions which was to defend the workers’ rights and interests against the employers and the state has now changed and been replaced by a new