TIONS

RELA
1
TRIAL
ULE
INDUS
/ MOD
UNIT

THE SYLLABUS
A.

INDUSTRIAL RELATIONS OVERVIEW

B.

INDUSTRIAL DISPUTES

C.

TRADE UNIONS AND COLLECTIVE BARGAINING

D.

INDUSTRIAL RELAITONS RELATED INDUSTRIAL LAWS OF INDIA.

Industrial Relations an overview

MAIN FEATURES OF INDUSTRIAL RELATIONS.

Concept of Industrial Relations

Important needs for Industrial Relation.

Factors of Industrial Relations affecting the behavior of people at work

Methods

The objectives of IR

Contents of IR.

Scope of IR

Evolution and Growth of Industrial Relations in India.

LIBERALISATION/GLOBALISATION/PRIVATISATION (LPG)

Causes of poor Industrial Relations

MAIN FEATURES / CONCEPTS OF IR

Relationship between employees and management.

One of the most delicate and complex problems of modern industrial

society.

Cooperation of employees/workers and harmonious relationships MUST

for Industrial Progress.

Definition.

Relation of Individual or Group of employees and employers for

engaging themselves in a way to maximize the production of goods
or articles or services.

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/Union
of workers, etc.

Several Experts have defined INDUSTRIAL RELATIONS and

given their opinions.

Opinion of Mr. V. B. Singh :-

Industrial relations are social relations arising out of employer-employee

interaction in modern industries regulated by the State.

Industrial Relations involves a study of the State and the legal system,

The workers and employers organizations at the institutional level.

Patterns of Industrial organization (including management),

Capital Structure (including technology),

Compensation given to the labor force,

Existence of market forces at the different economic levels.

INDUSTRIAL RELATIONS AND HUMAN RESOURCE MANAGEMENT COMPARED:-

A.

Industrial relation pertains to the study and practice of collective

bargaining, trade unionism, and labor-management relations.

. In

other words Industrial relations include the processes through

which relationships are expressed, like:-

collective bargaining,

. workers
. and

participation in decision-making,

grievance and dispute settlement process,

. and
. the

management of conflict between employers, workers and trade

unions.

A. Human resource management is a distinct field in

that it deals with non-union-employmentrelationships and the personnel practices and
policies of employers.

Important needs for Industrial Relation:

To defend the interest of workers for all the employment

benefits.

To help the workers to seek perfect working condition for

producing maximum output.

To ensure social security measures for workers.

To achieve democracy by allowing workers to take part

in management,

To protect human rights of individual workers.

To have much more attractive salaries in Indian

subcontinent.

To have better job opportunities in flourishing economy

of India.

Factors of Industrial Relations affecting the behavior of

people at work:-

1.

Mental inertia on the part of the management and labor.

2.

An intolerant attitude of contempt towards the workers on the part

of management.

3.

Inadequate fixation of wages or wage structures.

4.

Unhealthy working conditions.

5.

Gross indiscipline on the part of workers.

6.

Lack of human relations skill on the part of supervisors and

managers.

7.

Desire on the part of workers for higher bonus or DA and

corresponding desire of the employers to give as little as possible.

8.

In appropriate introduction of automation, without providing the

right infrastructure / working condition.

IMPORTANCE OF INDUSTRIAL RELATIONS.

It establishes Industrial democracy. Collective bargaining mutual

cooperation - hence survival and growth.

It contributes to economic growth and development increased

efficiency higher productivity and income.

Improves morale of the work force - higher productivity income

job satisfaction promotions higher pay.

It ensures optimum use of scarce resources.

It discourages unfair trade practice both on the part of workers and

management.

It prompts enactment of sound labor legislations.

It facilitates sea change in the organization Goods elations

corporations team work performance productivity and hence
growth

Methods by which we can possibly ensure goods IR:

To Focus on collective bargaining,

To work on Workers participation in the industrial relations schemes,

To implement Discipline procedure,

To have a proper Grievance redressal machinery, or Dispute

settlements machinery.

To ensure Union reorganization wherever and whenever needed.

To try revisions of existing rules, regulations, policies, procedures,

hearing of labor courts, tribunals etc. to have good IR.

Contents of IR.

It includes matter pertaining to employment conditions. LIKE:-

pay,

hours of works,

leave with wages,

health, and safety disciplinary actions,

lay-off, dismissals retirements and laws relating to such activities,

regulations governing labor welfare,

social security,

industrial relations,

issues concerning with workers participation in management,

collective bargaining, etc.

Scope of IR:-

IT MEANS all industrial relationships leading to industrial harmony and

industrial democracy.

The scope of IR can easily been delineated as follows:-

1. By protecting the workers interest.

2.By establishing reasonable wage system.

3.By provision of safe and adequately good working condition.

By providing other social security measures.

By maintaining progressive and positive trade unionism.

By collective bargaining.

Industrial peace by settling industrial disputes through mutual

cooperation and consent and better legal measures and policies.

Industrial democracy by workers participation in management and

recognition to human rights.

The main PURPOSES of industrial relations can be

delineated follows:-

1. Promotion and development of healthy labor

management relations.

2. Maintenance of industrial peace and avoidance of

industrial strife.

3. Development and growth of industrial democracy.

 The

objectives of IR are delineated to:-

1. Establish and foster sound relationship between workers and

management.

2. Avoid industrial conflicts and strikes.

3. Keep, as far as possible, strikes, lockouts and gheraos, etc. at

bay by enhancing the economic status of workers.

4. Provide an opportunity to the workers to participate in

management and decision making process.

5. Raise productivity in the organization to curb the employee

turnover and absenteeism.

6. Avoid unnecessary interference of the government, in the

matters of relationship between workers and management.

7. Establish and nurse industrial democracy based on labor

partnership in the sharing of profits and of managerial decisions.

8. Socialize industrial activity by involving the government

participation as an employer.

9. State control over industrial undertakings with a view to

regulating production and promoting harmonious industrial
relations.

10. Socialization and rationalization of industries by making the

state itself a major employer.

Industrial Relations: Evolution and Growth in India.

Industrial relations had SEVERAL industrial revolutions.

Two different phases of Indian History are pre-and post

independence periods.

INDUSTRIAL RELATIONS IN PRE-INDEPENDENCE PERIOD.

a)

Indian community under colonial rules.

b)

Suppression of Indian Workers were common.

c)

Working conditions provided were very bad.

d)

Indian workers did not have freedom of association or to

raise their voice against English Regime.

e)

Poor pay and miserable working conditions were order of

the day.

Industrial Relations: Evolution and Growth in India

(CONTD.)

The caste system greatly influenced the ancient industries and their
development.

Most Indian industries were modelled after the British system and
did not suit Indian people.

Exploitation of workers day in and out by British regime.

No proper legislative laws by British to support the interest of

workers.

End of world war - I marked considerable changes in IR in India.

20th Century witnessed lot of strikes in Indian Industries.

Finally Britishers passed a legislation called Trade Disputes Act,

1929.

This Act did not have any firm machinery for proper settlement of
the disputes.

The British Government also did not enforce the above Act.

Until 1938 there was no significant changes in the Industrial Relations or

Industrial Democracy.

The then Bombay Government established Industrial Relations Act (BIR)

1938.

Under this Act well organized and permanent machinery for settling
industrial disputes was set up.

The Act was further replaced by BIR Act, 1946 to bring in further
improvement in IR.

UNFORTUNATELY AFTER THE SECOND WORLD WAR IR SENERIO IN INDIA

WENT INTO SEVERE DECLINE MODE.

Evolution of Indian Industrial Relations POST INDEPENDENCE PERIOD.

Drastic improvements noticed in IR.

Industrial Disputes Act, 1947 was introduced right on the eve of

independence.

This ID ACT helped immensely for settlement of all sorts of

Industrial Disputes.

Industrial Truce Resolution PASSED which appealed to both the

industries as well as workers to cooperate with each other as well as
Govt. for Industrial Harmony.

Evolution of IR has also the following sequence of events:-

1.

Establishment of Indian Labor Conference (ILC) SIMILAR TO

International Labor Organization -

Between 1947 to 1956, the rep. of Government as well as

employees and workers met on regular basis.
Govt. made Several Regulations/legislations based on
recommendation of ILC members to improve IR in India.

IR change from LEGAL to VOLUNTARY!!!!

Lot of legal measures were taken by Govt. initially in the post

independence period of 1947 to 1956.

Between 1957 and 1965 one could see lot of change of focus for ILC.

Thus voluntary agreements between workers and managements started

being made without Govt. influence.

Under ID Act, from 1957 to 1965 lot of labor resolutions like, Code of
Discipline, Joint Management Councils, Works Committees, were formed.

Effect of Social and Political unrest on IR (1962-1971).

Two Wars were fought during this period one by China and one with
Pakistan.
Lot of Political Unrest and non implementation of schemes, violation of
labor agreement were witnessed during the above period.

Hence it was bad time of IR in India.

4. Period of National Emergency 1972-1976. Severe political social and

economic unrest in India.
All Fundamental Rights of people of the country was curbed.
IR suffered to a great extent.

Revival of the NCL (National Commission for the Labor).

After lifting of Emergency in the country, in 1977, the Janata Party

Government led by former P.M Mr. Morajee Desai, revised the NCL.

A draft of new IR bill was prepared in 1978, but its enactment could not be
done because of non cooperation from major political parties.

Industrial Relations in India Port 1980.

Militancy in Trade unfortunately raised its head in 1980-1981 period.

Assaults and murders were carried out of various labor union leaders as
well as company CEOs.

Example : - President of HMS, and MD of Bombay Tyres. Etc. Maruti HRM

in resent times.

Several labor cases pending with Government and Court with no

resolutions in site.

Sudden explosion of population also resulted in rise in unemployment,

prices o commodities.

All these led to bad Industrial Relations during 1980s.

Benefits of Industrial Relations

Uninterrupted Production: The most important benefit of industrial

relations is that it ensures continuity of production.

Continuous employment for all involved right from managers to workers.

There is uninterrupted flow of income for all.

Smooth running of industries is important for manufacturers, of perishable

goods, and consumers of mass consumption.

Good industrial relations bring industrial peace which increases

production.

Causes of poor Industrial Relations

Economic causes:-

Often poor wages and poor working conditions.

Unauthorized deductions from wages, lack of fringe benefits,

Absence of promotion opportunities, faulty incentive schemes are other

economic causes.

Inadequate infrastructure, worn-out plant and machinery, poor layout,

unsatisfactory maintenance etc.

Organizational causes:

Faulty communications system, unfair practices, non-recognition of trade

unions and labor laws are also some other causes of poor relations in
industry.

Causes of poor Industrial Relations

Impact of the company's human resources practices.

Includes low productivity, absenteeism, high employee turnover,

low job security,

unsatisfactory or unsafe working environments,

failure to recognize performance in pay plans, and lack of motivation.

LIBERALISATION/GLOBALISATION/PRIVATISATION (LPG)

The economy of India had undergone significant policy shifts in the

beginning of the 1990s.

Balance of power shifted in favor of the Employers.

1992 was stating point of Indias economic liberalization.

All round pressure from IMF/World Bank etc. put lots of pressure on then
Indian Govt. to change in labor policies.

This new model of economic reforms is commonly known as the LPG or

Liberalization, Privatization and Globalisation model.

The primary objective of this model was to make the economy of India the
fastest developing economy in the globe to match up with the biggest
economies of the world.

The chain of reforms that took place with regard to business,

manufacturing, and financial services industries.

These economic reforms brought in overall economic growth of the

country.

Friendly regulations, reduction in wok force , Schemes like VRS were

introduced successfully.

Some of the impacts on Industrial Relations due to LPG.

Collective bargaining decentralized.

Industries could reduce employment to cope with domestic and foreign

competition.

Shortage of good managers and skilled labors were felt.

Number of local unions increased and influence on union from

outside/political bodies got reduced

Employers encouraged only internal unions and association of workers.

HRM was seen as a key component of any business strategy.

Training and skill development has started receiving attention in a number

of industries banking and IT Industries in particular.

Liberalization:

Liberalization refers to the slackening of government regulations.

The economic liberalization in India denotes the continuing financial reforms

which began since July 24, 1991.

Privatization

Privatization refers to the participation of private entities in businesses and

services and transfer of ownership from the public sector (or government) to
the private sector as well.

Globalisation

Globalisation stands for the consolidation of the various economies of the

world.

Spreading wings ON WIDE RANGE OF COUNTRIES.

LPG and the Economic Reform Policy of India

In 1990, the country experienced a balance of payments dilemma

following the Gulf War and the downfall of the erstwhile Soviet Union.

The country had to make a deposit of 47 tons of gold to the Bank of

England and 20 tons to the Union Bank of Switzerland.

LPG and the Economic Reform Policy of India

This was necessary under a recovery pact with the IMF or International Monetary
Fund.

Furthermore, the International Monetary Fund necessitated India to assume a

sequence of systematic economic reorganizations.

Consequently, the then Prime Minister of the country, P V Narasimha Rao initiated
groundbreaking economic reforms.

However, the Committee formed by Narasimha Rao did not put into operation a
number of reforms which the International Monetary Fund looked for.

Dr Manmohan Singh, the present Prime Minister of India, was then the Finance
Minister of the Government of India. He assisted. Narasimha Rao and played a key role
in implementing these reform policies.

SOME OF THE MAJOR EFFECT OF LPG IN INDIA

Foreign Technology Agreements

Automatic approval Project Exports /Project Imports

Automatic approval for technology imports into India for projects.

Foreign Direct Investment

MRTP Act, 1969 (Amended) to suit Indias LPG policies

Deregulation.

Beginning of privatization.

Opportunities for overseas trade (Foreign Trade).

Steps to regulate inflation.

Tax reforms

Abolition of Industrial Licenses for manufacturing by keeping only factory

license requirements.

Abolition of License Raj and ushering in of Permit Raj.

Abolition of quota systems.

Cutting down of import customs duties from a mean level of 85 to 100 per
cent to 10 per cent peak customs duty, and withdrawing quantitative
regulations.

The rupee or the official Indian currency was turned into an exchangeable
currency on trading account (including export-import).

ISSUES AND CHALLENGES IN FUTURE FOR INDUSRIAL RELAITONS

Employees to be partners in management and ensure their talents are

utilized.

Increased self confidence in the young and qualified employees.

Management should balance human values rationally.

Remember that Industrial Relation is function of three variables i.e.

Management / trade union / workers.

FOR IMPROVING TRADE UNION HAROMENY the following line of action suggested:

Rational outlook of managers towards the workers and vice-a-versa for harmonious
relations.

Proper organization climate.

Comprehensive disciplinary rules.

Highly efficient system of communication between both parties.

More detailed follow up pattern for IR.

Respect General Public view and democracy.

A good IR Policy to bring about, good wage policy, democratic rights with voting
system, collective bargaining and tripartite negotiations.

Above all Good IR in India is possible only when there are elements like,

MUTUAL RESPECTS FOR EACH OTHER, TRUST,

LOVE TOWARDS TRUTH AND JUSTICE,

COOPERAITON, COMMON OBJECIVE, CO.EXISTENCE

AND INDUSTRIAL PEACE.

CONCLUDED

THANKS