A STUDY ON INDUSTRIAL RELATIONS IN

RASTRIYA ISPAT NIGAM LIMITED VISAKHAPATNAM STEEL PLANT VISAKHAPATNAM In partial fulfillment for the award of the degree of MASTER OF BUSINESS ADMINISTRATION IN HUMAN RESOURCE MANAGEMENT A Project Report submitted by P.MARY (Reg.No. 10MU1E0022) Under the guidance of Sri K SANJEEVA RAO (Assistant General Manager)-WELFARE.

DEPARTMENT OF MANAGEMENT STUDIES

SRI VENKATESWARA INSTITUTE OF SCIENCE & INFORMATION TECHNOLOGY

TADEPALLI GUDEM.
1

CERTIFICATE OF PROJECT GUIDE

This is to certify that the project report entitled A STUDY ON INDUSTRIAL RELATIONS IN RASHTRIYA ISPAT NIGAM LIMITED is a bonafide work done and submitted in partial fulfillment of the requirement for the award of Degree and by P.MARY under my guidance & supervision.

Station: Visakhapatnam Date:

K SANJEEVA RAO AGM(Per)-WELFARE

DECLARATION

I, Ms. MARY, hereby declare that the project work titled INDUSTRIAL RELATIONS with regard to RASTRIYA ISPAT NIGAM LIMITED is the original work done by me and submitted to

Sri Venkateswara Institute

of Science and IT College in partial fulfillment of the requirements for the

award of degree MBA in (HR) is a record of original work done by me under the supervision of

Mr. K. SANJEEVA RAO AGM(Per)-WELFARE Visakhapatnam Steel Plant, Visakhapatnam.

Date:

Signature of the student

P.MARY

ACKNOWLEDGEMENT

I express my gratitude to all of them, who gave full support to me in preparing this project, especially my sincere thanks to my college Sri

Venkateswara Institute of Science and IT College for their support

and also to all departments of Visakhapatnam Steel Plant.

I am grateful to all my professors in my college for giving me their valuable suggestions on the project and for their co-operation.

My special thanks to Mr. K. SANJEEVA RAO Assistant General Managerwelfare, for extending their valuable support. I am glad to say that this project would not have been successful without their support.

SYNOPSIS
In this project I have tried to relate Management Development Programmes conducted by HRD department with Industrial Relations in Visakhaptnam Steel Plant or how can Industrial Relations be improved by Management Development Programmes. So in my project there are two chapters first chapter is regarding industrial relations in Vizag Steel Plant and the second chapter is on training and development programmes (Management Development Programmes). Information in this project is both primary and secondary data. At the beginning I have given a brief description of companys profile which includes an overview of Vizag Steel Plant, Manpower, resources, raw materials, mines, performance of the company over the years HR policies, achievements and awards and final products produced through company. In the first chapter I have collected information regarding industrial relations and various programmes that are undertaken to maintain harmonious industrial relations in the organization. This chapter gives an overview of the industrial relations in the Visakhapatnam Steel plant. This chapter gives a brief of various types of laws relating to industrial relations, welfare measures in Vizag Steel Plant which helps in maintaining the employees in the VSP satisfied,

Central employees relation role, Trade union scenario, Election scenario, Disciplinary procedures followed, Workers participation in management, Emergence of Joint Consultative Machinery, Grievance management,

Participative committees, Samalochana and Quality circles in the Visakhapatnam Steel Plant. Information regarding the major industrial disputes has been kept in this chapter. In the second chapter, I have applied six sigma to the feedbacks provided on management development programmes conducted in the organization. I have collected information regarding the approach of VSP in conducting management development programmes and methods they adopt in conducting these programmes. In programmes have been exclusively conducted for personnel and IR department and the trade union members to maintain a good IR environment in the organization. At last there are suggestions and observation regarding how the programmes can be implemented to maintain good IR.

TABLE OF CONTENTS

TITLE INTRODUCTION Overview of the Company CHAPTER 1 1. INTRODUCTION 2. NEED FOR THE STUDY 3. OBJECTIVE 4. SCOPE OF THE STUDY 5. METHODOLOGY 6. LAWS RELATED TO INDUSTRIAL RELATIONS 7. DISCIPLINARY PROCEDURES 8. INDUSTRIAL DISPUTES 9. WORKERS PARTICIPATION IN MANAGEMENT 10. GRIEVANCE MANAGEMENT 11. QUESTIONNAIRE 12. ANALYSIS AND INTERPRETATION 13. SUMMARY 14. CONCLUSION 15. SUGGESTIONS FOR FURTHER STUDY
7

CHAPTER 2 1. SUGGESTIONS REGARDING IMPROVING IR BIBLIOGRAPHY APPENDIX

INTRODUCTION TO STEEL INDUSTRY

Whats in the name? Nothing, one might say. For steel a century old metal there additionally seems no reason for any possible non-unanimity of thought. But here precisely are the chances for out going wrong. True, like most industries, the Indian Steel Industry has experienced the highs and lows of the business cycle, has been impacted by the globalization and has been subjected to the vagaries of market forces in a liberalized set up. But at the end of it all, what we have today is a highly evolved, resilient and an ever vigilant industry, which through adoption of State-of-the-art technologies has kept pace with changing times, producing an out put that has not only stood the test of time but has globally transformed the way men think and do business in steel.

India got into the steel making in the early 20th century when JRD Tata set up the first steel mill in the country in 1907 in Jamshedpur. Since then, the steel industry has undergone a lot of changes but the Tata Iron and Steel Company continues to be the largest private steel maker in the country. The steel industry in the 70s and 80s was dominated by TISCO & SAIL. With the price control regime in place, the steel companies could turn in a profit without any major effort.

In the initial economic reforms, industrialists saw the economic growing at 7% per annum and since steel consumption is directly linked to the growth in economy, it was assumed that demand for steel in the country would explode. This led to huge flow of investments into the steel industry and many EAF based steel units were set up. The 1st phase (1914-1947) of its evolution can be traced to the beginning of the 20th century when the steel industry made a beginning as an icon of active patriotism, thanks to the pioneering spirit of Swadeshi entrepreneurs in the private sector. This period saw a small but viable steel capacity of about 1 million tones. Although the initial years justified these assumptions and steel consumption really took off, this scenario was not to continue for long. The political instability and the resultant slow down in reforms saw the economic growth slowing down. During the second phase (1947-1992), in the hands of the early planners this industry became an important instrument for attaining rapid economic growth because of two inherent advantage enjoyed by it. Firstly, Indias fast reserves of the basic raw materials conferred a certain competitive advance to this industry. Secondly the wide-ranging linkages, both forward & backward sector has with the rest of the economy made it an ideal catalyst for generating and sustaining economic development.

10

INDIAS STEEL SCENARIO Indian Steel industry has always remained isolated and protected by Government, where the steel industry was never expected to generate profit from business, but was expected to provide employment to the unemployed. Presently India is operating with open-hearth furnaces. The existing equipment, energy and layout in Indian Steel industry are much low than the developed countries. Indian Steel industry generates a significant amount of waste materials, which can cause environmental problems. The four aspects of Waste

Management namely residue reprocess, recycle and recovery do not hold much ground in the Indian Steel Industry. The Indian companies cannot spend more for pollution control. The energy consumption per tone is 50-100% higher than that of the International norms. The countrys aim is to sell quality steel. The government is also helping the steel industries in this basis.

11

PROBLEMS OF STEEL INDUSTRIES: -

Non-availability of good quality raw material is another problems faced by iron and steel industry. The modern giant blast furnace needs high-grade iron ore and good metallurgical coal. Further, the industry is unable to get good quality coke and manganese is which the principal raw materials next to iron ore are unfortunately most of our resources of good manganese ore are of poor quality besides the non availability of good quality raw material, regular supplies of raw materials are very much handicapped due to the absence of good transport facilities. Another problem faced by the steel industry related to the difficulty in getting Zinc supplies for the continuous galvanizing line. Lack of technical problems Bhilai had to execute orders for shipment of rails to Iran, South Korea and Malaysia. Because of technical limitations, Rourkela plant is unable substitute aluminum of Zinc for the production of galvanized sheet apart from source internal technical problems; our technology in the field of steel production is not a developed one when compared to other advanced countries. For instance, Japan is production quality steel in spite of importing raw material and additional material from other country.

TABLE2-1:

Steel Plants with Foreign Collaborations

12

S No 1. 2. 3. 4.

Plant Rourkela Steel Plant Bhilai Steel Plant Durgapur Steel Plant Bokaro Steel Plant

Collaboration Capacity of Finished Steel Products West Germany Erstwhile USSR Britan Erst USSR

13

TABLE2-2: Annual Productions at Various Steel Plants Collaboration Capacity of Finished Steel S No Plant Products
1. 2. 3. Rourkela Steel Plant Bhilai Steel Plant Durgapur Steel Plant West Germany USSR Britan

Annual Production
7,20,000 tonnes 7,70,000 tones 8,00,000 tons

TABLE2-3: Annual Production at Various Steel Plants S No 1. 2. 3. 4. Plant Rourkela Steel Plant Bhilai Steel Plant Durgapur Steel Plant TISCO ORIGINAL MT/Year 1.0 1.1 1.0 1.0 EXPANDED MT/Year 1.8 2.5 1.6 2.0

a) RASRIYA ISPATH NIGAM LIMITED

Steel occupies the foremost place among the materials in use to day and pervades all walks of life. All the key discoveries of the human genius- for in stance, stream engine, railway, means of communication and connection, automobile, aero plane and computers are in one way or other, fastened together with steel and with its sagacious and multifarious application. Steel is a versatile material with multitude of useful properties making it indispensable for furthering and achieving continual growth of the economy be it construction,

14

manufacturing, infrastructure or consumables. The level of steel consumption has long been regarded as an index of industrialization and economic maturity attained by a country. Keeping in view the importance of steel, the fallowing integrated steel plants with foreign collaboration were set up in the public sector in the post independence era:

Table2-4
SI.NO. STEEL PLANTS
Durgapur steel plant Bhilai steel plant Bokaro steel plant Rourkela steel plant Visakhapatnam steel plant

COLLABORATED BY
Britain Erstwhile USSR Erstwhile USSR Germany Erstwhile USSR

1. 2. 3. 4. 5. BACKGROUND:

To meet the growing domestic needs of steel, Govt. of India decided to set up an integrated steel plant at Visakhapatnam. An agreement was signed with erstwhile USSR in 1979 for cooperation in setting up 3.4 Mt integrated steel plant at Visakhapatnam. The foundation stone for the plant was laid by the then prime minister on 20th January 1971. The project was estimated to cost Rs. 8397.28 Based on process as on 4 th quarter of 1981. However, on completion of construction and commissioning of the whole plant in 1992, the cost escalated to around Rs.8,500 Cr. unlike other integrated steel plant in India, Visakhapatnam steel plant (VSP) is one of the most

15

modern steel plant in the country. The plant was dedicated to the nation on 1st August 1992 by the then prime minister, shri PV Narsimharao. New technology, large scale computerization and automation etc., are incorporated in the plant. To operated the plant at international levels and attain such labour productivity, organizational manpower has been rationalized. The plant has a capacity of producing 3.0Mt of liquid steel and 2.656 Mt of saleable steel.

VISAKHA STEEL PLANT A MISSION : STATE- OF-THE-ART: Operating at Over 120% rated capacity at. 3.6 Mt. Liquid Steel To double Capacity by 2008-09 Mission To produce 16 Mt by 2020 Most Energy Efficient plant in the Country. 7 meter tall coke ovens batteries with coke dry quenching. Biggest blast furnaces in the country. Bell less top charging system in blast Furnace. 100% slag granulation at the BF cast House. Suppressed combination LD gas recovery system. 100% continuous casting of liquid steel. Tempcore and stemor cooling process in LMMM & WRM respectively. Extensive waste heat recovery systems. Comprehensive pollution control measures.

16

WATER SUPPLY: Operational water requirement of 36 mgt is being met from the yeleru water supply scheme.

POWER SUPPLY: Operational water requirement of 180 to 200 MW is being met through captive power plant. The capacity of the power plant is 286.5 MW. VSP is Exporting around 60 MW power to AP
17

MAJOR SOUCES OF RAW MATERIALS: Table2-5 RAW MATERIAL Iron Ore Lumps & Fines BF Lime Stone SMS Lime Stone BF Dolomite SMS Dolomite Manganese Ore Boiler Coal Coking Coal Medium Cocking Coal (MCC) SOURCE Bailadilla, AP Jaggayyapeta, AP UAE Madharam, AP Madharam, AP Chipurupalli, AP Talcher, Orissa Australia Gidi/Swang/Rajarappa/Kargali

MAJOR UNITS: Table2-6 DEPARTMENT ANNUAL CAPACITY (000 T)

2,261 5,256 3,400 3,000

UNITS(3.0 MT Stage)

Coke Ovens Sinter Plant Blast Furnace Steel Melt Shop

3 Batteries of 67 Ovens & 7 Mtrs. Height 2 Sinter Machines of 312 Sq. Mtr. Grate area each 2 Furnaces of 3200 Cu. Mtr. Volume each 3 LD Converters each of 133 Cu. Mtr. Volume and six 4 Strand bloom casters 4 Stand finishing Mill 2*10 Stand finishing Mill

LMM WRM

710 850

18

CHAPTER 1
(INDUSTRIAL RELATIONS)

19

VISAKHAPATNAM STEEL PLANT

- AN OVERVIEW

Steel occupies the foremost place among the materials in use to day and pervades all walks of life. All the key discoveries of the human genius- for in stance, stream engine, railway, means of communication and connection, automobile, aeroplane and computers are in one way or other, fastened together with steel and with its sagacious and multifarious application. Steel is a versatile material with multitude of useful properties making it indispensable for furthering and achieving continual growth of the economy - be it construction, manufacturing, infrastructure or consumables. The level of steel consumption has long been regarded as an index of industrialization and economic maturity attained by a country. Keeping in view the importance of steel, the following integrated steel plants with foreign collaboration were set up in the public sector in the post - independence era:

20

Sl.No. 1. 2. 3. 4. 5.

Steel Plants Durgapur Steel Plant Bhilai Steel Plant Bokaro Steel Plant Rourkela Steel Plant Visakhapatnam Plant

Collaborated By Britain Erstwhile USSR Erstwhile USSR Germany

Steel Erstwhile USSR

BACKGROUND: To meet the growing domestic needs of steel, Govt. of India decided to set up an integrated steel plant at Visakhapatnam. An agreement was signed with Erstwhile USSR in 1979 for cooperation in setting up 3.4 Mt integrated steel plant at Visakhapatnam. The foundation stone for the plant was laid by the then Prime minister on 20th January 1971. The project was estimated to cost Rs 8397.28 Based on process as on 4th quarter of 1981. However, on completion of construction and commissioning of the whole plant in 1992, the cost escalated to around Rs8500 Cr. unlike other integrated steel plant in India, Visakhapatnam steel plant (VSP) is one of the most modern steel plants in the country. The plant was dedicated to the nation on 1St August 1992 by the then prime minister, Shri P.V Narsimha Rao.

21

In the plant new technology, large-scale computerization and automation were incorporated. To operate the plant at international level and attain such labour productivity, organizational manpower has been rationalized. The plant has a capacity of producing 3 Mt of liquid steel and 2.656 Mt of saleable steel. Operating at Over 120% rated capacity at.3.6 Mt. Liquid Steel To double Capacity by 2008-09 Mission - To produce 16 Mt by 2018-19. Most Energy Efficient plant in the Country. 7 meter tall coke ovens batteries with coke dry quenching. Biggest blast furnaces in the country. Bell - less top charging system in blast Furnace. 100% slag granulation at the BF cast House. Suppressed combination - LD gas recovery system. 100% continuous casting of liquid steel. "Tempcore" and "Stemor" cooling process in LMMM & WRM respectively. Extensive waste heat recovery systems. Comprehensive pollution control measures. WATER SUPPLY: Operational water requirement of 36 mgt is being met from the Yeleru water supply scheme.

22

POWER SUPPLY: Operational water requirement of 180 to 200 MW is being met through captive power plant. The capacity of the power plant is 286.5 MW. VSP is Exporting around 60 MW power to APSEB.

MAJOR SOURCES OF RAW MATERIALS: RAW MATERIAL Iron Ore Lumps & Fines BF Lime Stone SMS Lime Stone BF Dolomite SMS Dolomite Manganese Ore Boiler Coal Coking Coal Medium Cocking Coal (MCC) SOURCE Bailadilla, AP Jaggayyapeta, AP UAE Madharam, AP Madharam, AP Chipurupalli, AP Talcher, Orissa Australia Gidi/Swang/Rajarappa/Kargali

23

MAJOR UNITS Department Coke Ovens Annual Capacity (000 T) 2,261 3 Batteries of 67 Ovens & 7 Mtrs. Height Sinter Plant 5,256 2 Sinter Machines of 312 Sq. Mtr. Grate area each Blast Furnace 3,400 2 Furnaces of 3200 Cu. Mtr. Volume each Steel Melt Shop 3,000 3 LD Converters each of 133 Cu. Mtr. Volume and six 4 Strand bloom casters LMM WRM 710 850 4 Stand finishing Mill 2*10 Mill MMSM 850 6 Stand finishing Mill Stand finishing Units (3.0 MT Stage)

24

MAIN PRODUCTS OF VSP: STEEL PRODUCTS Angles Billets Channels Beams Squares Flats Rounds Re- Bars Wire Rods BY PRODUCTS Nut Coke Coke Dust Coal Tar Anthracene Oil HP Napthalene Benzene Toluene Zylene Wash Oil Granulated Slag Lime Fines Ammonium Sulphate

Total EMP : 17225 as on 29-02-2009 No. of Executives: 5025 No. of Non Executives : 12200 Attrition Rate in Executives : 1.2% Attrition Rate in Non Executives: 0.42%

25

VISION, MISSION & OBJECTIVES:

Vision: To be a continuously growing world - class company we shall Harness our growth potential and sustain profitable growth. Deliver high quality and cost competitive products and be the first choice of customer. Create an inspiring work environment to unleash the creative energy of people. Achieve excellence in enterprise management. Be a respected corporate citizen, ensure clean and green environment and develop vibrant communities around us. Mission: To attain 16 million ton liquid steel capacity through technological up graduation, operational efficiency and expansion; to produce steel at international standards of cost and quality; and to meet the aspirations of the stakeholders.

26

OBJECTIVES: Expand plant capacity of 6.3 millions ton by 2008 - 2009 with the mission to expand further in subsequent phases as per the corporate plan. Sustain gross margin to turnover ratio >25% Be amongst the top five lowest cost steel producers in the world by 200910. Achieve higher levels of customer satisfaction than the competitors. Be recognized as the excellent organization by 2008- 09. Instill right attitude amongst employees and facilitate - them to excel in their professional, personal and social life. Be proactive in conserving environment, maintaining high levels of safety and addressing social concerns.

27

Core Values: Commitment Customer Satisfaction Continuous Improvement Concern for Environment Creativity & Innovation VSP takes all necessary actions for the fulfillment of regulatory requirements. It has dedicated departments for this purpose. Energy conservation, environmental preservation, safety in work place, and

occupational health gets highest priority in the company. Some of the policies in this regard are reproduced below.

HR POLICY: We, at Visakhapatnam steel plant, believe that our employees are the most important resources. To realize the full potential of employees, the company is committed to: Provide work environment that makes the employees committed and motivated for maximizing productivity. Establishing systems for maintaining transparency, fairness and equality in dealing with employees.

28

 Empower employees for enhancing commitment, responsibility and accountability. Encourage teamwork, creativity, innovativeness and high achievement orientation. Provide growth and opportunities for developing skills and Knowledge. Ensure functioning of effective communication channels with employees. HRD GROUP - KEY INITIATIVE: In - house training progress Nominations to external training programs Organization research, employees' satisfaction surveys & voice of employees' index Organization development Membership with professional bodies Performance appraisal for executives Human resource information system In - plant training for management students Lectures by eminent personalities Corporate presentations Interaction with professionals, academicians and consultants Knowledge management
29

 Initiatives on "six sigma" Emancipation of women through WIPS, women development programs (spring board) Thrust on "samalochana" Pursuit of business excellence model (BEM) Dil ki baat Chairman tho maata

HUMAN RESOURCE MANAGEMENT: Human resource initiatives at VSP are closely linked to the corporate strategy of the organization. VSP has harmonious industrial relations where the entire workforce works as a well - knit team for the progress of the company. The productive environment prevailing in the company fosters an atmosphere of growth - both for the employees and for the company. VSP has introduced multiskilling concept since interpretation and the employees are trained to imbibe this. VSP has adopted a system of overlapping shifts - the first of its kind, in the industry. This system ensures smooth change over of the shifts and uninterrupted pace of operation of the plant during the shift change over. Another unique feature followed at VSP is the uniform working hours for the ministerial and non - ministerial employees. The labor productivity is currently 282tonnes/man/year - unparalleled in the public sector steel industry.
30

WELFARE AMENITIES: Welfare has been given the utmost emphasis in the overall policy of Human Resource Management of the company. Pursuant to this policy, VSP has taken several initiatives for introducing and implementing Non - statutory welfare which impart and propagate the feeling that the "company cares for its employees". Some of the non - statutory welfare and social security schemes for the benefit of the employees and their family members are detailed below:

ACHIEVEMENTS & AWARDS The efforts of Visakhapatnam Steel Plant have been recognized in various for a. Some of the major awards received by Visakhapatnam Steel Plant are in the area of energy conservation, environment protection, safety, Quality, Quality Circles, Rajbhasha, MOU, Sports related awards and a number of awards at the individual level.

SOME OF THE IMPORTANT AWARDS RECEIVED BY VSP ARE INDICATED BELOW: ISO 9002 for SMS and all the downstream units-a distinction in the Indian Steel Industry.

31

 Indira Priyadarshini Vrikskha Mitra Award: 1992-93. Nehru Memorial National Award for Pollution Control: 1992-93 & 1993-94. EEPC Export Excellence Award: 1994-95. CII (Southern Region) Energy Conservation Award: 1995-96. Golden Peacock (1St Prize) National Quality Award-96 IIM in the National Quality Competition 1996. Steel Minister's Trophy for "Best Safety Performance-1996". Selected for "World Quality Commitment Award-1997" of J*Ban, Spain. Gold Star Award for Excellent performance in Productivity. Udyog Excellence Gold Medal Award for Excellence in Steel Industry. Excellence Award for outstanding performance in Productivity

management, Quality & Innovation. Ispat Suraksha Puraskar (First Prize) for longest Accident free period, 1991-94. Best Labour Management Award for the Govt of A.P. SCOPE Award for best turnaround for 2001. Environment Excellence Award from Greentech Foundation for energy conservation in 2002. Best Enterprise award from Scope, WIPS for 2001-02. Best enterprise award from SCOPE for surpassing MOU-targets - 2003-04.

32

 ISTD Award for "Best HR Practices" - 2002. Prime ministers trophy for "Best Integrated steel plant" - 200203. "World quality commitment international star Award" in the gold category conferred by business initiative Directions, Paris. "organizational Excellence Award" for 2003-2004 conferred by INSAAN RINI, has been bestowed with several national accolades in the year 20052006 significant among them being: National Energy Conservation Award for the 6t' time in succession. National Award for Excellence in Cost management. Viswakharma Rashtriya puraskar Awards (6 out of 32 at the national level). FAPCCI Best industries productivity Award. INSAAN National Award for Organizational Excellence. Best CEO Award. The above Awards are besides a number of at the local, regional & national level competition in the area of Quality Circles, Suggestion Schemes etc.

HALLMARK OF VIZAG STEEL AS AN ORGANIZATION: Today, VSP is moving forward with an aura of confidence and with pride amongst its employees who are determined to give their best for the company to enable to reach new heights in organizational excellence.

33

At the same time, no single advantage accruing from a knowledge society is found wanting by the neighborhood community with the growth & development of a phenomenon called VIZAG STEEL existing so close to its proximity, futuristic enterprises, academic activity, planned & progressive residential localities are but few of the plentiful ripple effects of this transformation and each one of us take immense pride to uphold the philosophy of mutual i.e, individual and societal) progress. The remarkable performance on production front coupled with I' prudent financial management has not only resulted in achieving I significant net profits but also helped RINL emerge as a `NET POSITIVE COMPANY' in January, 2006 by wiping out all its accumulated losses during 2005- 06.

STATISTICAL INFORMATION: I. Production Performance (000 Tones) Year 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 Hot Metal 3,485 3,941 4,055 3,920 4,153 4,046 3,913 Liquid Steel 3,083 3,356 3,508 3,560 3,603 3,606 3,322 Saleable Steel 2,757 3,056 3,169 3,173 3,237 3,290 3,074 Labour Productivity (Tones / Man /Year) 228 253 262 265 282 413 389

34

II.

Commercial Performance (Rs Crores) Year Sales Turnover 4,081 5,059 6,174 8,181 8,469 9,131 10,433 Domestic Sales 3,710 4,433 5,406 7,933 8,026 8,487 9,878 Exports 371 626 768 248 443 424 555

2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008

III.

Financial Performance (Rs Crores) Year Gross Margin 690 1,049 2,073 3,271 2,383 2,633 3,515 Cash Profit 400 915 2,024 3,260 2,355 2,584 3,483 Net Profit (-) 75 521 1,547 2,008 1,251 1,363 1,943

2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 EXPANSION PLAN

The envisaged expansion of the plant capacity by 2008-09 is as below 1. Hot metal 2. Liquid steel - 6.50 Mtpa - 6.30 Mtpa

35

3. Saleable steel

- 5.72 Mtpa

The following major facilities are proposed to be added under expansion stage 1. Blast furnace -3800 M3 -1 No. 2. Sinter plant a. Sinter machine No. 3 -400 M2 - 1No. 3. Steel melt shop No.2: a. LD converters 150 M3Cap b. 6 strand billet casters c. 6 strand round caster - 2No.s - 2 No.s - 1 No

d. Secondary Steel Making Facilities 4. Rolling Mills: a. Wire rod mill no. 2 - 600000 TPY b. Special bar mill c. Structure mill - 750000 TPY - 700000 TPY

d. Seamless tube plant - 300000 TPY VSP will enhance the volume of production in long products segment in view of brand image. In order to deliver the product mix and help reduce the dependence on import of pipes in oil and gas sector, seamless pipe mill is envisaged.

36

1. Wire rod (plain) - 5.5 mm to 20 mm in coils 2. Special bars (plain) - 16 mm to 40 mm - in coils and straight lengths. 3. Structurals 4. Seamless pipe - 139 mm to 3.65 mm

5. Semis - blooms, billets The project is estimated to cost Rs 8259 Crores.

37

CHAPTER-1 (INDUSTRIAL RELATIONS)

INTRODUCTION 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. Industrial relations has become one of the most delicate and complex problems of modern industrial society. Industrial progress is impossible without cooperation of labors and harmonious relationships. Therefore, it is in the interest of all to create and maintain good relations between employees (labour) and employers (management).

38

NEED FOR THE STUDY:

The healthy industrial relations are key to the progress and success. Their significance may be discussed as under: To continue uninterrupted production. To reduce industrial disputes. To maintain high morale in employees and workers. To reduce wastage. To increase the overall performance of the organization. Thus, 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. 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 t 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.

39

OBJECTIVES:
The following are the specific objective of the present study: To know various programmes, those are helpful in maintaining good industrial relations To study the Industrial Relation system and their activities in VS P. To study the IR system and effectiveness. To know various laws, machineries (joint consultative machineries), and management techniques through which organization achieves industrial peace. To study industrial disputes and causes and affects of arising of such disputes. To study, identify and suggest measures to improve effectiveness specifically from quality perspective.

SCOPE OF THE STUDY: To know the function of the organization how they are really functioning how the policies are made and implemented and conveyed to the employees, to know these things visited several departments of VSP. Those departments are: Human resource development department Personnel Management Department

40

 Interacting with unions Marketing department Legal department etc.

METHODOLOGY It discusses the methods that have been employed for data collection (both primary and secondary data) and also justifies the method followed. It then details the sample size and the type and gives justifications for both. It also discusses the problem of the study, the objectives, the scope and its limitations.

Data collection: Adequate and relevant information is essential for any meaningful research. It forms the basis of the study by supporting the analysis. For any research two types of data are required. 1. Primary data - the data that is collected for the first time and 2. Secondary data - the data that is gathered from second hand sources. Primary data: The primary data for this research study has been collected using a questionnaire. The questionnaire method has the following advantages Advantages:

41

 The responses are less biased as the person collecting data is not present at the time of the respondent filling in the form It provides a good and permanent record of data, which is not possible in an interview.

This method might also have a few demerits: The questions have to be clearly understood by the respondent. Respondents will not have a second chance, if he requires clarifications on the entries. Care has been taken to explain the items in the questionnaire to the respondents to avoid the demerits discussed above. Secondary data: The secondary data for the study consisted of details on Performance Appraisal system being implemented in the organization and details about the organization, its origin, growth, development and other issues. All this data has been collected from the company's records. Some data about the company has been collected from VSP magazine.

42

Type: Stratified Random sampling technique is selected. This is the only technique that provide with a representative sample. Since employees from all levels (strata) namely the top level, the middle level, and the low level managers are included. At the strata level employees have been chosen at random.

Limitations: The time is a major limitation. The whole study was conducted within a period of two months. The study does not cover non-executive some executive cadre and chairman and managing director. The study conifers itself only to assistant managers to general managers. Study is quality perspective. The information gathered in, this regard is mostly through information discussion. Only the existing system is studies and no attempt has been made to identify and complete new and dynamic performance system due to this constraints. To get information about satisfaction level of employees from Industrial Relations and its effectiveness, a stratified sample survey was conducted. For the present study of the data has collected by way from the following ways.

43

QUESTIONNAIRE: The questionnaire was personally administered with respondent in VSP. 50 questionnaires were distributed. Questionnaires were distributed as such: 20 - Executives. 20 - Non- Executives. 10 - Union members. It took nearly 10 minutes for each respondent to fill the questionnaire. The responses given by the respondents were tabulated and a score sheet is prepared.

MANAGEMENT OF INDUSTRIAL RELATIONS IN VIZAG STEEL PLANT

Presently, 20 registered Trade unions are functioning at VSP. Out of these, 2 unions viz., Visakha Steel Employees Congress (INTUC) & Visakha Steel Workers Union have the support of more than 95% of the total votes. There are 17 unions operating for espousing the cause of contract labour. In addition, two unions each are also separately registered at our captive mines located at Jaggayyapeta and Madharam. By and large, smooth and cordial IR climate prevails at VSP.

44

The "Mandays Lost" were brought to `NIL' since 2003 which indicates the peaceful and harmonious industrial relation scenario in Visakhapatnam Steel Plant. The Code of discipline adopted in the state of Andhra Pradesh has envisaged determination of majority union by way of secret ballot elections at an interval of every 2 years. So far 9 elections have been held at VSP since November, 1985. In the 9th elections held in the year 2008, Visakha Steel Workers Union (Steel Progressive Front consisting of 9 registered unions has emerged as the majority union and was conferred the status of recognition for a period of 2 years. Integration of various activities close monitoring and review enabled conduct of trade unions elections without much disturbance to the production activities. Despite intense electioneering, - labour productivity was still kept at a high peak. Till date around 75 nos. of Memorandum of Understandings (MOU), Memorandum of Settlements (MOS) were arrived at by duly following proper collective bargaining process. These notable features are getting union(s) commitment for realization of Mission and Objectives, increase of Production and Productivity, improving discipline etc. The practice of resolving any issue with the recognized union though mutual discussions was being followed in VSP cordial atmosphere. However, his

45

resulted in the intense inter-union rivalries and implementation of issues settled with Recognized Union was found to be difficult for both the Unions and Management. To overcome such a situation, an institutional framework has been evolved for Joint Consultation with representatives of the management providing scope for consultations in all major areas like production, productivity, quality, safety etc., vide settlement dated 12/061996. However, this spirit of joint consultative Machinery has been discounted due to various reasons including withdrawal by some of the Unions. Around 110 nos. Of Participative Fora are functioning at VSP which have diminished inter-union rivalries and ushered in a peaceful IR climate. A large number of employees are given an opportunity of participation in various fora at VSP including Quality Circles and Suggestion Schemes. Unique informal and formal Grievance Redressal System has been successfully implemented in the organization providing for an active employee Participation/involvement. A separate section "Central Employees Relations " coordinates with respect to all IR related issues including holding discussions, coordinating with meetings and negotiations etc., ;

46

LAWS RELATED TO INDUSTRIAL RELATIONS

1) THE TRADE UNION ACT, 1926 OBJECTS This act has been enacted with the object of providing for the registration of trade unions and verification of the membership of trade unions registered so that they may acquire a legal and cooperative status. As soon as a trade union is registered, it is treated as an artificial person. The amendments of the act in 1982 have been made with a view to achieve the following objectives: To reduce the multiplicity of unions, the existing provision states that a trade union of workmen shall at all times continue to have not less than 10% or 100 of the workmen, which ever is less, subject to a minimum of 7 persons engaged or employed in the establishment or industry with which it is concerned as its members. A provision has been made for a period of 60 days for the registration of trade unions by the registrar, after all the formalities have been completed by the trade unions.

47

 75% of the office bearers in the executive of a registered trade union shall be persons actually engaged or employed in an industry with which the trade union is connected. To empower the registrar of trade unions to verify the membership of registered trade unions and connected matters and report, the matter to the State and the Central Government.

APPLICABILITY OF THE ACT The act extends to whole of India. The word "except the State of Jammu &Kashmir" has been omitted by the amended act of 1970 with effect from 1 st September 1971. The act applies not only to the unions of workers but also to the associations of employers. Certain acts do not apply to a registered trade union, namely, (i) the societies registration act, 1860; (ii) the cooperative societies act, 1912; and (iii) the companies act, 1956. The registration of any such act is null and void. The act is Central legislation, but it is administered and enforced mostly by the State Governments. For the purpose of this act, the central government handles the cases of those unions whose objective are not confined to one state. All other types unions are the concern of State Governments. They can also appoint additional or Deputy Registrars, who may exercise the powers and
48

functions of the registrars, as it thinks fit, so as to obviate delays in the disposal of applications for registration of trade unions.

FUNCTIONS OF TRADE UNIONS IN INDIA As per the Indian Trade Union Act, 1926, the primary function of a trade union is to protect and promote the interests of the workers and the conditions of their employment. They can also have other objectives, which are not inconsistent with this primary purpose of opposed to any law. In India, trade unions generally undertake the following functions: i. To achieve higher wages and better living conditions for the members. ii. To acquire control over running of the industry by workers iii. To minimize the helplessness of the individual workers by making them stand-up unitedly and increasing their resistance power through collective bargaining, protecting the members against victimization and injustice by employers. iv. To raise the status of the workers as partners in industry and citizens of society by demanding an increasing share for them in the management of industrial enterprises. v. To generate self-confidence among the workers. vi. To take up welfare measures for improving the moral of the workers.

49

FEATURES OF THE ACT All the principal terms and conditions of employment, except matters pertaining to wages and other forms of remuneration, are settled clearly under the Standing Orders. Most of the mutual rights and duties of workers and management are clearly defined. The procedures to be followed whenever there is any dispute over theses mutual rights and duties are also specified. The procedure which the management is to follow in disciplining the worker, and the procedure which the worker has to follow when he has a grievance are both given in clear language.

50

3) FACTORIES ACT 1946 A social legislation which has been enacted for occupational safety, health and welfare of workers at work places. Being enforced by technical officers i.e. Inspectors of Factories, Dy. Chief Inspectors of Factories who work under the control of the Chief Inspector of Factories and overall control of the Labour Commissioner, Government of National Capital Territory of Delhi

APPLICABILITY The industries in which ten (10) or more than ten workers are employed on any day of the preceding twelve months - engaged in manufacturing process being carried out with the aid of power or twenty or more than twenty workers employed in manufacturing process being carried out without the aid of power.

SALIENT FEATURES 1. Approval of Factory Building Plans before construction/extension, under the Delhi Factories Rules, 1950 2. Grant of Licenses under the Delhi Factories Rules, 1950, and to take action against factories running without obtaining License. 3. Renewal of Licenses granted under the Delhi Factories Rules, 1950, by the Dy. Chief Inspectors of Factories

51

4. Inspections of factories by District Inspectors of Factories, for investigation of complaints, serious/fatal accidents as well as suo moto inspections to check compliance of provisions of this Act relating to : Health, Safety, Welfare facilities, Working hours, Employment of young persons and annual Leave with wages etc. 4) ESI ACT Provides certain benefits to employees in case of sickness, maternity and employment injury. It applies to all factories (including Government factories but excluding seasonal factories) employing ten or more persons and carrying on a manufacturing process with the aid of power or employing 20 or more persons and carrying on a manufacturing process without the aid of power.

ACTS DOES NOT APPLY Factories working with the aid of power wherein less than 10 persons are employed; Factories working without the aid of power wherein less than 20 persons are employed;

52

 Seasonal factories engaged exclusively in any of the following activities viz. Cotton ginning, cotton or jute pressing, decortication of groundnuts, the manufacture of coffee, indigo, lac, rubber, sugar (including gur) or tea

BENEFITS *Medical benefits FULL MEDICAL CARE consists of hospitalization facilities -includes specialist services, drugs and dressings and diets as required for in-patients. Sickness benefit is roughly 50% of the average daily wages and is payable for 91 days during 2 consecutive benefit periods. Maternity Benefit is payable to an Insured Woman in the following cases subject to contributory conditions: Confinement-payable for a period of 12 weeks (84 days) - anti-natal 6 weeks & post - natal 6 weeks restricted to 2 children Dependents benefit Accident Benefit Funeral expenses COVERAGE AND CONTRIBUTION The existing wage-limit for coverage under the Act, is Rs.10,000/- per month (with effect from 1.10.2006).

53

 Currently, the employee's contribution rate (w.e.f. 1.1.97) is 1.75% of the wages and that of employer's is 4.75% of the wages paid/payable in respect of the employees in every wage period

5) WORKMEN COMPENSATION ACT The Workmen's Compensation Act, aims to provide workmen and/or their dependents some relief in case of accidents arising out of and in the course of employment and causing either death or disablement of workmen. It provides for payment by certain classes of employers to their workmen compensation for injury by accident.

EMPLOYERS LIABILITY The employer of any establishment covered under this Act, is required to compensate an employee: Who has suffered an accident arising out of and in the course of his employment, resulting into (i) death, (ii) permanent total disablement, (iii) permanent partial disablement, or (iv) temporary disablement whether total or partial, or Who has contracted an occupational disease

54

THE EMPLOYER SHALL NOT BE LIABLE In respect of any injury which does not result in the total or partial disablement of the workmen for a period exceeding three days; In respect of any injury not resulting in death, caused by an accident which is directly attributable to the workmen having been at the time thereof under the influence or drugs, or the willful disobedience of the workman to an order expressly given, or to a rule expressly framed, for the purpose of securing the safety of workmen

6) INDUSTRIAL DISPUTES ACT "Industry" means any systematic activity carried on by cooperation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature)

7) BONUS ACT 1965 APPLICABILITY

55

 "Industry" means any systematic activity carried on by cooperation between an employer and his workmen (whether such workmen are employed by such employer directly or by or through any agency, including a contractor) for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes (not being wants or wishes which are merely spiritual or religious in nature)

ELIGIBILITY i) Every person (other than an apprentice) drawing salary up to Rs 3,500 per month. ii) Every person drawing salary between Rs 2,501/- and Rs 3,500/- per month. The bonus payable to him is to be calculated as if his salary were Rs 2,500/- p.m. - salary means basic pay + DA only

56

BENEFITS i. Subject to other provisions: - Minimum bonus shall be 8.33% of salary/wages earned or Rs 100 whichever is higher. ii. If allocable surplus exceeds the amount of minimum bonus, then bonus shall be payable at higher rate subject to a maximum 20% of salary/wages. iii. Computation of bonus is to be worked out as per Schedule I to IV of the Act.

8) GRATUITY ACT 1965 The Act provides for the payment of gratuity to workers employed in every factory, shop & establishments or educational institution employing 10 or more persons on any day of the proceeding 12 months. A shop or establishment to which the Act has become applicable shall continue to be governed by the Act even if the number of persons employed falls bellow 10 at any subsequent stage. All the employees irrespective of status or salary are entitled to the payment of gratuity on completion of 5 years of service. In case of death or disablement there is no minimum eligibility period. The amount of gratuity payable shall be at the rate of 17 days wages based on the rate of wages last drawn, for every completed year of service. The maximum amount of gratuity payable is Rs. 3,50,000/-.
57

 Formula is - Last Wages *15*No. of services/26 9) EMPLOYEE PROVIDENT ACT APPLICABILITY i. Every establishment which is a factory engaged in any industry specified in Schedule 1 and in which 20 or more persons are employed and ii. Any other establishment employing 20 or more persons which central Government may, by notification, specify in this behalf. (Infancy period of 3 years has been withdrawn by ordinance w.e.f.22-9-97) iii. Any establishment employing even less than 20 persons can be covered voluntarily u/s 1(4) of the Act.

ELIGIBILITY Any person who is employed for work of an establishment or employed through contractor in or in connection with the work of an establishment.

BENEFITS Employees covered enjoy a benefit of Social Security in the form of an unattachable, unwithdrawable (except employees and employers

contribute equally throughout the covered persons employment. This sum is payable normally on retirement or death. Other Benefits include

58

Employees' Pension Scheme and Employee's Deposit Linked insurance Fund.

10) PAYMENT OF WAGES ACT 1936 OBJECTIVES To ensure regular and prompt payment of wages and to prevent the exploitation of a wage earner by prohibiting arbitrary fines and deductions from his wages.

SCOPE AND COVERAGE Application for payment of wages to persons employed in any factory. Not applicable to wages which average Rs 1600/- per month or more. Wages include all remuneration, bonus, or 'sums payable for termination of service, but do not include house rent reimbursement, light vehicle charges, medical expenses, TA, etc.

11) MINIMUM WAGES ACT, 1948 A tripartite Committee viz., "The Committee on Fair Wage" was set up in 1948 to provide guidelines for wage structures in the country. The report of this Committee was a major landmark in the history of formulation of wage policy in India. Its recommendations set out the key concepts of the

59

'living wage', "minimum wages" and "fair wage" besides setting out guidelines for wage fixation. Article 391- The State shall, in particular, direct its policy towards securing (a) that the citizen, men and women equally shall have the right to an adequate livelihood and (b) that there is equal pay for equal work for both men and women. Article 43 ~- The State shall endeavor, by suitable legislation or economic organization or in any other way, to give all workers, agricultural, industrial or otherwise, work, a living wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure, and social and cultural opportunities.

OTHER BENEFITS: Act also provides provisions for leave for miscarriage, leave for illness arising out of pregnancy or delivery, premature birth of child or miscarriage and nursing breaks for nursing the child until the child attained the age of 15 months (section-9, 10 & 11) DISMISSAL, DEDUCTION WAGES, ETC: No employer shall discharge or dismiss a woman for her absence form work in accordance with the provisions of this Act and no deduction shall be

60

made from the normal; and usual daily wages of a women entitled to maternity benefits. (Section -12&13).

12) THE MINES ACT, 1952 This act extends to the whole of India and prescribes the safety and satisfactory conditions of work in the mines. This act applies to all types of mines, including mines of atomic minerals and oil _fields. It was amended in 1983. According to this act, hours of work all adult workers, both surface and underground should not exceed 48 hours a week. That means if a person is working on surface he is not allowed to work more than 9 hrs and if the person is working underground then he is not allowed to work not more than 8 hrs. The person should be given rest for every 5 hrs for atleast half an hour. The act does not allow overtime until there is a emergency. During overtime a person is not allowed to work more than 10 hrs/day (inclusive of overtime). Such person is paid wages at double the normal rate. Women are not allowed to work underground. Adolescent can work if he fulfills some conditions such as: He should be more, than 16 yrs old. He should be medically fit.
61

 He has 1/2 hour of rest for every 4 and 1/2 hour of continuous work.

13) THE CONTRACT LABOUR ACT, 1970 This act extends to whole of India and applies to every establishment in which 20 or more workmen are or were, employed on any day during the preceding 12 months as contract labour. This act does not apply to establishments where work is of-irregular or occasional or intermittent nature. The work performed in an establishment is not considered to be of an intermittent nature:

DISCIPLINARY PROCEDURE

Discipline is a code of conduct in an Enterprise in which the members of the enterprise conduct themselves within the standards of acceptable behavior which means that the stipulations of the code of conduct laid down by the enterprise are properly understood and observed by one and all. The state of IR in a country/ factory is also reflected in the discipline and the morale of the labor force. Discipline is very essential for a healthy industrial atmosphere and the achievement of organizational goals.

62

In any organization maintenance of discipline among personnel at all levels is required to create the conductive work environment so as to facilitate increased productivity and organizational effectiveness. So management of an organization can adopt two approaches for the discipline maintenance. Adopting preventive measures `prevention is better than cure' principle is based on the assumption that employees perform better through rewards than punishments. So the problems of indiscipline do not emerge. Curative measures (disciplinary actions) are taken against people involved in indiscipline. The disciplinary action should be taken after going through specific process because the punishment may be laid invalid if there is any deviation from the procedure laid down. The procedure for taking disciplinary action is defined by the Standing orders by the organization. While taking an action, all the relevant facts leading to indiscipline must be ascertained so that the need for disciplinary action is determined. The facts must be collected as soon as possible to take the action promptly.

DISCIPLINARY PROCEDURE AT VSP When an act of misconduct is alleged against a workman for whom a punishment as provided under Standing Orders of the Company. The workman shall be given an opportunity to show cause before punishment is imposed.
63

DISCIPLINARY AUTHORITY Any Executive/ officer to whom powers are delegated to take disciplinary action against a workman shall be the disciplinary authority competent to initiate disciplinary authority competent to initiate disciplinary action and to impose punishment on a workman. The disciplinary authority shall frame definite charges on the basis of the allegations against him. The charges together with a statement of allegations on which they are based shall be communicated in writing to the workman who shall be required to submit a written statement of his defense with such time as may be specified but not exceeding 3 days by the discipline authority. If it is necessary the disciplinary authority shall hold an enquiry and take necessary actions.

APPELLATE AUTHORITY The workman shall have the right of appeal to Appellate Authority. The appeal shall be submitted within 15 days of receipt of the order of the disciplinary authority and the appellate authority shall dispose of the appeal with in 30 days of the receipt of the appeal.

64

INDUSTRIAL DISPUTES

Dispute in general sense is the expression of differences over some issues of interest between 2 or more parties. Industrial disputes like problems of indiscipline and their effective management are on the major issues in maintaining good industrial relations in the country/organization. According to industrial disputes act 1947 "Industrial disputes means any dispute or difference between employers and employers or between employers and workers or between workmen and workmen, which is connected with the employment or with the conditions of labour of any person" An individual dispute between an employer and one of his workmen is by itself not an industrial dispute, which can be referred to under section 10 of the act. But such a dispute may become an industrial dispute provided a majority of workmen or union of workmen takes up the cause of particular workman, in the particular industrial establishment. The causes of industrial disputes are many and varied and sometimes even trivial. In India, various causes, of industrial disputes may be grouped into 4 categories: economic factors, management factors, trade union practices and political and legal factors. Preventive form such industrial disputes management can take catenations which are grouped into two categories:

65

(1) Prevention of Industrial Disputes This can be done by taking following measures Workers participation Collective bargaining Grievance procedure Tripartite bodies code of discipline Standing orders

(2) Settlement of Industrial Disputes If preventive measures fail then the industrial dispute settlement machinery should be activated by the government under industrial disputes act 1947 because no settlement of dispute will prove to be very costly to the workers, management and the society as a whole. This machinery consists of Conciliation Court of enquiry Voluntary arbitration Adjudication (Compulsory arbitration) WORKERS PARTICIPATION IN MANAGEMENT Workers participation, also known as labour participation or Employee participation, in management is a concept shrouded with so vagueness that for
66

different meanings. The basic reason for this perceptual difference is due to different pattern of practices and programmes adopted by various countries for implementing workers participation in management. Many industrial relations experts regard it as an essential step involving redistribution of power between management and workers in the direction of industrial democracy though there are differences of views over the content and level of participation. The principal forms through which workers participate are information sharing, joint consultation and suggestion schemes. The various forms of workers participation in management have assumed great importance these days because it serves the following purposes Reduced industrial unrest Maintaining good industrial relations Higher productivity Workers participation in VSP Management of VSP also facilitates workers participation which secures a right for the recognized union in representing their views and opinions regarding production, safety, canteen and township development etc., through the formation of different committees at shop floor and plant level, but these committees constitute the representatives of recognized union, leaving behind the opinions of the other unions that constitute to around 60% of employees.

67

This lead to the inter-union rivalry as the non-recognized unions were set aside without being consulted regarding the policy matters, creating difficulties in implementation of issues that was settled - through negotiations. Sl.No. 1 Name of the forum Central safety committee Periodicity No. of of the Committees meeting To maintain proper safety Once in 43 One for and health at work and to review periodically the measures taken on that behalf and to work in line with the provisions laid down in the factories act, 1948 2 Canteen management committee Closely monitor functioning of the different canteens in the company Once in a month One for plant and one pit safety committee for each mine 3 Shop floor cooperation committee 4 Shop floor safety To discuss and sort out day to day shop level issues To discuss shop floor issues related to safety, Once in a month Once in a month (25+2) including mines (25+2) including months plants and one pit safety committee for each mine Scope of function

68

committees

fire and occupational health and to take decisions for ensuring safe working conditions and safe practices

mines

Provident fund trust

To supervise and administer the functioning of provident fund of VSP

Once in a month

One

VSP sports council

To lay down policies on sports activities in the company

Once in two months Once in month

One

Town development committee

For development of company township in the areas of housing maintenance, shopping infrastructure facilities etc.

One

Superannuation benefit fund trust

To provide provision for social security needs of the employees and administering superannuation benefits fund scheme

Once in a month

One

69

GRIEVANCE MANAGEMENT

Grievance management is a state of dissatisfaction over some issues related to employment. Generally, expression of this dissatisfaction in oral form is known as complaint while on written form it is known as grievance. In the organizational settings, employees may have some grievances against employers, in the same way employers may have grievances against employees. Grievance management is very essential to maintain good industrial relations because this increases productivity and effectiveness of an organization. Grievance should be redressed by adopting proactive approach rather than waiting for the grievance to be brought to the notice of management. In many cases even the proactive approach of the management for removing the causes of grievances may leave some scope for the emergence of grievances. For handling such grievances, a grievance handling machinery known as grievance procedure is required. The grievance procedure is problem solving, dispute settling machinery which has been set up following an agreement to that effect between labour and management. It is the means by which a trade union or an employee makes and processes his claims that there has been a violation of the labour agreement by

70

the company. Grievance procedure is a device through which grievances are settled, generally to the satisfaction of employees/trade union and management.

GRIEVANCE REDRESSAL PROCEDURE AT VSP The objective of grievance redressal is to provide easily accessible machinery for settlement of grievances of executives and to adopt measures as would ensure expeditious settlements of grievances leading to increased satisfaction on the job and resulting in improved productivity and efficiency of the organization. In VSP the grievance procedure consists of three stages they are:

Stage-1 An aggrieved employee shall send his grievance to his HOD within a period of 3 months of its occurrence. The head of the department will give a personal hearing and try to resolve the grievance at the level and intimate his decision to the aggrieved employee in writing within a week

Stage-2 If the aggrieved employee is not satisfied with the reply of stage -1 authority or has not got a reply within the stipulated time, he may submit his grievance to the divisional head. The divisional head concerned shall go through the grievance and settle the same at his level. The decision taken shall be
71

communicated in writing to the aggrieved employee within 15 days of receipt of the grievance

Stage - 3 If the aggrieved employee is not satisfied with the reply of stage -2 or has not got reply within the stipulated time, he may address his grievance to the grievance council shall examine the grievance in detail and give their recommendations before the end of the month following the month in which the grievance council receives the representation. The aggrieved shall have the right to represent his grievance before chairman-cum-director direct if his grievance is not settled to his satisfaction at Stage-3 or within the tome as prescribed under the company's grievance procedure Some of the matters that come under the Grievance Redressal are: Payment of wages and incentive Increments Deduction/recovery of dues Allowances and advances Seniority and promotion Attendance and leave

QUESTIONNAIRE

72

This questionnaire is regarding Industrial Relations in Rashtriya Ispat Nigam Limited. Kindly provide your opinion to the given questions below. Tick ( ) mark in the given boxes. S.No. 1 Statements Employees satisfaction is the key factor to maintain good IR. 2 The Incentive Schemes ional welfare to the and motivate them for sufficient discharge of 3 Management Development programmes help in understanding the industrial relations and maintain harmonious relations. 4 The present Grievance Redressal system is sufficient to resolve the individual grievances of employees. Strongly Agree Cannot Disagree Strongly Agree Say Disagree

73

The participation Committees help in maintaining harmonious relationship between employees and the management.

The Disciplinary Procedure and its implementation by the management are very satisfactory.

The Dispute settlement procedures (Collective bargaining) followed by the management is able to resolve industrial disputes satisfactory.

When compared to other organization, in VSP the trade unions have got a

Management must acquire more knowledge and

74

information prior discussing issues with trade union. 10 The present opportunities are enough to associate in decision making at different stages to improve all round performance at VSP. 11 Workers extend full support to the calls of trade union on all occasions. 12 Employees repose confidence and trust on the leaders of different trade unions with respect to up keep of their interest. 13 The management is always industrial relations issues and maintains Cordial relationship with the unions.

75

14

Harmonious relationship between trade unions and management is affected by political interferences.

15

Government plays a major role in maintaining good IR environment in the organization.

Thank you for taking out time and filling up this questionnaire.

76

ANALYSIS AND INTERPRETATION

Statement No: 1Employees satisfaction is the key factor to maintain good IR. Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 18 24 8 0 0 50 Percentage 36% 48% 16% 0% 0% 100

77

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: Majority of them have agreed (agree 48% and strongly agree 36%) that healthy industrial relations can be maintained through employee satisfaction.

78

Statement No: 2 The Incentive Scheme are additional welfare to the employees and motivate them for more efficient discharge of duties. Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 15 28 4 3 0 50 Percentage 30% 56% 8% 6% 0% 100

79

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: Welfare measures and incentive measures help employees to be motivated and discharge their duties efficiently. These measures help maintain employee satisfaction during the work.

80

Statement No: 3 Management Development Programmes help in understanding the industrial relations and maintain harmonious relations.

Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 14 32 4 0 0 50 Percentage 28% 64% 8% 0% 0% 100

81

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: Management development programmes conducted in centre for HRD help in understanding the industrial relations in the organization. People disagreeing with the statement are nil.

82

Statement No: 4 The present Grievance Redressal system is sufficient to resolve the individual grievances of employees.

Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 6 20 10 11 3 50 Percentage 12% 40% 20% 22% 6% 100

83

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: There is much information needed to interpret this statement as 20% of people have opted for cannot say and 28% disagree with the statement. There should be some more improvements in the Grievance Redressal system in VSP. Awareness has to be created regarding the functions of grievances redressal system to cover the 20% of respondents who have opted for cannot say.

84

Statement No: 5 The participation Committees help in maintaining harmonious

relationship between employees and the management.

Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 9 31 5 4 1 50 Percentage 18% 62% 10% 8% 2% 100

85

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: Majority of the respondents feel participation committees helps in conveying their problems and issues and solve them effectively. Which helps maintains good harmonious between employees and management.

86

Statement No: 6 The Disciplinary Procedure and its implementation by the management are very satisfactory.

Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 4 23 8 13 2 50 Percentage 8% 46% 16% 26% 4% 100

87

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: Majority of them are very satisfied with the disciplinary procedure of the organization.

88

Statement No: 7 The Dispute settlement procedure (collective bargaining) followed by the management is able to resolve industrial disputes satisfactorily.

Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 11 33 4 2 0 50 Percentage 22% 66% 8% 4% 0% 100

89

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: Majority of the respondents are very satisfied with the dispute settlement procedure and they feel it resolves the disputes satisfactorily.

90

Statement No: 8 When compared to other organization, in VSP the trade unions have got a little role in achieving demands, since management itself extends many benefits.

Tabulation Format Sl.No. 1 2 3 4 5 Ratings Strongly Agree Agree Cannot Say Disagree Strongly Disagree Total Respondents 4 18 12 12 4 50 Percentage 8% 36% 24% 24% 8% 100

91

Respondents Percentage

Strongly Agree

Agree

Cannot Say Disagree

Strongly Disagree

Interpretation: As 24% have opted cannot say and people who disagree with the opinion are 24% we can interpret many of them do not accept this statement. This may be because though there are many benefits they all become outdated and new demands rise as and when there are requirement.

92

SUMMARY

Visakhapatnam steel plant has very peaceful IR. There are many s programmes that keep watch on IR environment in the organization. A Programmes such as "Samalochana" are very helpful in knowing the problems of employees and solving them in time, so that there are no grievances from employees in work life and can improve their productivity year by year. Participative committees, Grievance a management, Joint consultative

machinery, Disciplinary procedures help in solving the issues. These aspects make the management of RINL proactive in resolving the issues of employees and workers. The overall IR scenario in RINL/VSP is peaceful, cordial and healthy. A host of proactive IR measures which inter-alias include confidence building measures between union and management, extensive communications,

continuous interaction with unions and partnership in management in various participation forums have helped in developing a congenial IR climate propitious for high production and connectivity. With collective dedication and commitment of VSP, the organization has surmounted all odds and achieved best ever records by crossing its rated capacities, continuous efforts to improve
93

the employees moral have resulted in improving the technological and operational discipline which ultimately helped in heightening the motivation of the employees. This has envisaged from the labour productivity during 2007-08 which stood at 389 tons/man/yr. One of the most important factors is the productive work culture which is being considered as crucial importance in VSP. As such several initiatives have been taken to adopt a multi-skill and multi-trade pattern of working and emphasis on flexibility in job deployment thus ensured the optimum utilization of its HR. VSP has bagged runners-up award in the year 1994 in recognition of excellence in management which has facilitated harmonious IR in the organization. VSP has also bagged the best management award for the year 200001 form the - state government of A.P for outstanding contribution in maintenance of IR, labour welfare and productivity.

94

CONCLUSION
Industrial relations is one of the important aspects to be considered in the organization, as it deals with employers, employees and the government. It is an aspect which each and every organization considers it in the first place for uninterrupted production and development of the organization. An industrial dispute such as strikes, lockouts etc. not only affects the employers of the organization but also affects the workers and the general public. So one has to think of ways to achieving industrial peace in the organization, political parties, the community and society should also play a decisive role in improving the existing industrial relations situation in the country. Some of the basic causes of industrial conflict can be prevented or at least reduced to great extent by effective management and union action. The employee communication, grievances procedure and speedy settlement of grievances, joint consultation at different levels of the plants. Workers education programmes, healthy and stable trade unions and their due recognition as barging agents, sincere observations of the code of discipline, labourmanagement, including facilities for transport, education, housing and health services for the workers and their families- all these would go .a long way in achieving industrial peace.

95

SUGGESTIONS FOR FURTHER STUDY

1. There are many opportunities in VSP which helps detecting grievances in the organization and maintain industrial peace. 2. Quality circle in VSP has been used to improve only technical aspects of the organization uptil now, but it can also be used to improve IR by redesigning the programme in some aspects. In this way quality circles can also be used to improve IR and tracking the grievances of employees in more efficient way. 3. A combination of both "Samalochana" and "Quality Circles" can be used to improve the overall conditions of the organizat.

96

HOW MANAGEMENT DEVELOPMENT PROGRAMMES IMPROVE IR?

Management development programmes not only improves soft skills of employees but it is also used as a platform where a person can communicate with employees or workers who are a part of union. It helps employees to understand organization and also organization to understand employees better than what they already know. It helps them adapt to the change when they are told about the various changing scenarios around them. It motivates the employees and increases their morale. It helps to increase understanding and cooperativeness between organization, employees and workers. This creates harmonious relations and environment in the organization. It helps them to share ideas and suggestions. It shows organization's care towards their employees in educating and motivating them.

97

SOME INDIRECT USES OF FROM THESE PROGRAMMES

As the working conditions in the plant are harsh such as high temperatures, dust, noise, intensity and complexity of the work. It helps them to deviate from their original work for a little while. It helps them relax in the pleasant conditions (central A/C, good snacks and ambience) of the CHRD. It keeps them cool-minded until their next session of these programmes. It makes them feel privileged to attend such programmes which enhances their personality and males them confident in their life. As the programmes are conducted for either executives or nonexecutives at same level. It helps them to interact with each other and have a good time during their snacks. This also shows concern of management towards their employees. Employees recognize this concern while conducting these programmes.

98

SUGGESTIONS FOR FURTHER STUDY

For acquiring good results in the project (on how. IR can be improved through management development programmes) following things should be taken into consideration. This study has to be conducted for atleast 8 months. So that person conducting this study can experience of how are the programmes conducted in the Centre for HRD and post evaluation of those programmes (which are conducted after six months of programme. Feedback on the programmes should be kept until final evaluation of programmes is completed. One can also conduct interview with some of the participants regarding the aspects in the programme. To know whether there is an improvement in the IR of VSP; person has to be adopt some method to measure IR improvement in the organization. Person conducting the study has to know both past and the present performance of IR. He has to have knowledge on IR environment in the organization. He has to be an employee of the organization to spend enough time on the project.

99

BIBLIOGRAPHY

WWW.VIZAGSTEEL.COM. A PROFILE OF VIZAG STEEL PLANT. SIX SIGMA CONCEPTS FROM WIKIPEDIA ESSENTIALS OF HUMAN RESOURCE MANAGEMENT AND

INDUSTRIAL RELATIONS - P. SUBBA RAO. DYNAMICS OF INDUSTRIAL RELATIONS - MANOHAR, MAMORIA AND GANKAR.

100

APPENDICES
ABBREVIATION IR HRD VSP RINL JCM MDP CHRD T.E.I L.M.M.M W.R.M M.M.S.M S.M.S BY T.P.P S.P R.M.H.P C.R.M.P FULL FORMS Industrial Relations Human Resource Development Visakhapatnam Steel Plant Rashtriya Ispat Nigam Limited Joint Consultative Machinery Management Development Programmes Centre for HRD Training Effectiveness Index Light and Medium Merchant Mill Wire Rod Mills Medium Merchant and Structured Mill Steel Melt Shop Blast Furnace Thermal Power Plant Sniter Plant Raw Material Handling Plant Calcining and Refractory Material Plant

101