Unit 1 : Overview of Industrial Relations : Concept of Industrial Relations; Nature of Industrial Relations;

Objectives of IR; Evolution of IR in India ; Role of State; Trade Union; Employers’ Organisation; ILO in IR.
Unit 2 : Trade Unionism : Trade Union : origin and growth, unions after independence, unions in the era of
liberalization; concept, objectives, functions and role of Trade Unions in collective bargaining; problems of
Trade Unions.
Unit 3 : Labour Problems : Discipline and misconduct; Grievance Handling Procedure; Labour turnover;
Absenteeism; Workers’ participation in management.
Unit 4 : Technological Change in IR-Employment issues, Management Strategy, Trade Union Response,
Human Resource Management and IR- Management Approaches, Integrative Approaches to HRM;
International Dimensions of IR.
Unit 5 : Labour Legislations: Industrial Dispute Act, Factories Act, Payment of Wages Act, Workmen’s
Compensation Act. Important Provisions of Employees’ State Insurance Act, Payment of Gratuity Act,
Employees Provident Fund Act.

Unit III
Grievance procedure and Discipline management:
Grievance - Meaning and forms, sources of grievance, approaches to grievance machinery, Grievance
procedures, and model grievance procedure.
Discipline - Causes of Indiscipline - Maintenance of discipline. Principles of Natural Justice, Judicial approach
to discipline, Domestic enquiries, Disciplinary procedures, approaches to manage discipline in Industry,
Principles of Hot stove rule.
Employee Grievances:
A grievance is a sign of employees‘ discontent with job and its nature.
Grievance is caused due to the difference between the employee expectation and management practice
Causes of Grievance
• Wages, Incentives
• Job Classifications
• Foreman/Supervisor
• Disciplinary Measures
• Promotions
• Transfer/Night Shift
• Safety And Health Measures
• Non Availability Of Materials
• Violation Of Contracts
• Improper Job Assignment
• Work Conditions

Employee Grievance procedure

3 important principles of grievance settlement are
1. Settlement at the lowest level
2. Settlement as expeditiously (speedily and efficiently)as possible
3. Settlement to the satisfaction of the aggrieved

Settlement of grievances at 3 levels

• Immediate supervisor(reply within 2 days)
• Departmental/factory head(reply within 3 days)
• Grievance committee(within 7 days)
• Else, appeal for further voluntary arbitration
Grievances Management in Indian Industry.-Grievance Machinery
• A grievance machinery is required to administer the grievance procedure

• Departmental representatives are selected to take forward the grievance procedure to solve the problems as a
committee

At present, there are three legislations dealing with grievances of employees working in industries. The
Industrial Employment (Standing Orders) Act, 1946, requires that every establishment employing 100 or more
workers should frame standing orders. These should contain, among other things, a provision for redressal of
grievances of workers against unfair treatment and wrongful actions by the employer or his agents. The
Factories Act, 1948, provides for the appointment of a Welfare officer in every factory ordinarily employing
500 or more workers. These Welfare officers also look after complaints and grievances of workers. They will
look after proper implementation of the existing labor legislation. Besides, individual disputes relating to
discharge, dismissal or retrenchment can be taken up for relief under the Industrial Disputes Act, 1947,
amended in 1965.
However, the existing labor legislation is not being implemented properly by employers. There is lack of
fairness on their part. Welfare officers have also not been keen on protecting the interests of workers in the
organized sector. In certain cases, they are playing a dual role. It is unfortunate that the public sector, which
should set up an example for the private sector, has not been implementing labor laws properly.
Guidelines for Handling Grievances
The following guidelines may help a supervisor while dealing with grievances. He need not follow all these
steps in every case. It is sufficient to keep these views in mind while handling grievances.
Treat each case as important and get the grievance in writing.
Talk to the employee directly. Encourage him to speak the truth. Give him a patient hearing.
Discuss in a private place. Ensure confidentiality, if necessary.
Handle each case within a time frame.
Examine company provisions in each case. Identify violations, if any. Do not hold back the remedy if the
company is wrong. Inform your superior about all grievances.
Get all relevant facts about the grievance. Examine the personal record of the aggrieved worker. See whether
any witnesses are available. Visit the work area. The idea is to find where things have gone wrong and who is at
fault.
Gather information from the union representative, what he has to say, what he wants, etc. Give short replies,
uncovering the truth as well as provisions. Treat him properly.
Control your emotions, your remarks and behavior.
Maintain proper records and follow up the action taken in each case.
Discipline:-Meaning
• Discipline refers to a condition or attitude among employees with respect to rules and regulations of an
organisation
• Discipline refers to the orderliness in working and behavior

Objectives of Discipline
• To obtain a willing acceptance of the rules, regulations
• To impart an element of certainty
• To develop the spirit of tolerance and adjustments
• To give and seek direction and responsibility
• To create an atmosphere of respect
• To increase the working efficiency and morale of the employees

Approaches to discipline
1. Positive Approach
2. Progressive discipline
3. Red Hot stove Rule
4. Judicial Approach to Discipline in India
A Positive Approach to Employee Discipline
Traditionally, methods for maintaining discipline have been punitive in nature. The relatively new concept of a
non-punitive positive discipline system is winning increasing acceptance among many employers. The purpose
of this method is to enable employees to truly confront their performance or attendance problems and take
responsibility for their actions. To be effective, disciplinary action should emphasize correcting the problem
rather than punishing the offender. It should maintain the employee's dignity and self-respect. It should provide
for increasingly serious steps if the problem is not resolved, and it should ultimately result in a change in the
employee's behavior and performance. Like traditional approaches, the positive discipline approach involves a
number of formal steps that increase in seriousness. But unlike punitive disciplinary systems, the positive
approach emphasizes reminders of expected performance — not warnings or reprimands for misconduct. Step
1: Oral Reminder — The first step in the positive discipline approach is a meeting between a supervisor and
the employee to discuss the problem. The supervisor tells the employee the reason for the rule that has been
violated, tells the employee the specific changes that are required, and expresses confidence that the employee
will correct the problem and the expectation that no further action will be needed. No record of the meeting is
placed in the employee's file. This is communicated to the employee, hopefully providing a strong incentive for
improvement. Step 2: Written Reminder — If the problem continues, the supervisor again talks to the
employee — seriously, but without threats. The supervisor tells the employee what is expected and asks the
employee to confirm that he or she understands what changes must be made. At the end of the discussion, the
supervisor tells the employee that a written summary of their conversation will be placed in the employee's file.
It's recommended that the employee be asked to sign the report of the documented discussion. Step 3: Decision-
Making Leave — In traditional discipline systems, the next step involves suspending the offending employee
for several days. In the positive discipline approach, the supervisor tells the employee to remain at home the
following day and to use that time to make a final decision as to whether she or he can meet the organization's
standards. The employee is told that the organization wants to keep him or her as a productive member of the
work force, but that the decision is up to the employee — and future violations will result in termination. The
employee is told to report back to the supervisor after thedecision-making leave day to let the supervisor know
his or her decision. The employee may be asked to develop a plan for improving his or her performance. Upon
returning to work, the results of the meeting with the supervisor should be documented, signed by the employee,
and placed in the employee's personnel file.
Progressive Approach to discipline
It is an employee disciplinary system that provides a graduated range of responses to employee performance or
conduct problems. Disciplinary measures range from mild to severe, depending on the nature and frequency of
the problem. For example, an informal coaching session might be appropriate for an employee who is tardy or
violates a minor work rule, while a more serious intervention -- or even termination -- might be called for if an
employee commits serious misconduct or doesn't improve a performance problem after receiving several
opportunities to do so.
Most large companies use some form of progressive discipline, although they don't necessarily call it by that
name. Whether they are referred to as positive discipline programs, performance improvement plans, corrective
action procedures, or some other title, these systems are all similar at their core, although they might vary in the
details. All are based on the principle that the company's disciplinary response should be appropriate and
proportionate to the employee's conduct.
1.
Judicial Approach to Discipline in India
The Industrial Employment (Standing Orders) act was passed in 1946 with a view to improve the industrial
relations climate. The Act requires that all establishments must define the service rules and prepare standing
orders. The term standing orders refers to the rules and regulations which govern the conditions of employment
or workers. They indicate the duties and responsibilities on the part of both the employer and the employees.
The standing order contain rules relating to:
Classification of employees , working hours, holidays, shift working, attendance , leave, suspension,
termination, stoppage of work etc..
Thus standing order specify the terms and conditions which regulate the employee-employer relationship within
a unit. Any violation of these terms and conditions may lead to misconduct or indiscipline.
Essentials of a good disciplinary system
To avoid conflict and lawsuits, managers must administer discipline properly.
1. Rules and Performance criteria
2. Documentation of the facts

3. Consistent response to rule violations

4. Training of supervisors
5. Prompt action
6. Impersonal discipline
7. Reasonable penalty
8. Follow-up
Principles of a Natural Justice
• The employee must be indicated about the charge against him
• The employee must be given a chance for defense
• The enquiry must be fair and impartial
• The evidence should be put forward in front of the employee
• Punishment should be appropriate with the misconduct

Managing difficult employees.

Problem employees are those employees who create problems within the organization. Substance abusers, angry
or withdrawn workers, personnel with excessive absenteeism, and the terminating employees provide
challenges to nurse managers. In each case the nurse manager must be alert to the symptoms of problems, help
the employee solve the problem, and evaluate the results.
Types of problem employee:-
Substance abusers
Angry or withdrawn employees
Decreased productivity
Absenteeism
Terminating employees

When the delinquent employee is going to be punished, the type of punishment should be a commensurate with
the severity of the omission or misconduct.
Different types of punishment resulting from various types of omission or misconduct are as follows:
Oral warnings
Written warnings
Loss of privileges and fines
Punitive suspension
Withholding of increments
Demotion
Red Hot stove Rule
The "Hot-Stove Rule" of Douglas McGregor gives a good illustration of how to impose disciplinary action
without generating resentment. This rule draws an analogy between touching a hot stove, and undergoing
discipline. When you touch a hot stove, your discipline is immediate, with warning, consistent, and impersonal.
These four characteristics, according to McGregor, as applied to discipline are self-serving and may be
explained as follows:
1. When you touch the Hot stove, you burn your hand. The burn was immediate. Will you blame the hot stove
for burning your hand? Immediately, you understand the cause and effect of the offense. The discipline was
directed against the act not against anybody else. You get angry with yourself, but you know it was your fault.
You get angry with the hot stove too, but not for long as you know it was not its fault. You learn your lesson
quickly.
2. You had warning as you knew the stove was red hot and you knew what would happen to you if you
touched it. You knew the rules and regulations previously issued to you by the company prescribing the penalty
for violation of any particular rule so you cannot claim you were not given a previous warning.
3. The discipline was consistent. Every time you touch the hot stove you get burned. Consistency in the
administration of disciplinary action is essential. Excessive leniency as well as too much harshness creates not
only dissatisfaction but also resentment.

The discipline was impersonal. Whoever touches the hot stove gets burned, no matter who he is. Furthermore,
he gets burned not because of who he is, but because he touched the hot stove. The discipline is directed against
the act, not against the person. After disciplinary action has been applied, the supervisor should take the normal
attitude toward the employee.
MISCONDUCT
The concept of misconduct is a general concept and is not confined to labourmanagement relations only.
Misconduct is a specific word with specific connotation and it is difficult to lay down any general rule in
respect of this problem. Under the Indian Penal Code and other special and local laws, some acts or omissions
are offences for which a person can be punished by the sovereign power of state. These offences or acts are
considered to be prejudicial to the interests of the society in general and, therefore, they are prohibited by law.
There ',re however, various other organisations such as professional bodies, clubs and corporations, and anyone
who wants to be a member of such body, for availing of the advantages and facilities provided by such body, is
also required to act under certain rules and subject to certain discipline. If he does anything in violation of rules
or any act inconsistent with his position, he is liable to lose the advantages and facilities of the association with
that society or organisation. Any such act is, therefore, generally called a "Misconduct". (B.R. Ghaiye,
"Misconduct in Employment", Eastern Book Company, 1982 P. 59).
The employment under a particular employer is also subject to certain rules and certain discipline, and any act
in violation of such rules or discipline will be a misconduct. Thus in industrial law, misconduct is an act which
makes the workman committing such act liable for punishment. Workmen involved in misconduct have to be
punished: Otherwise the-work-o€-the-industrial-organisation-will be hampered. Every organisation must
necessarily maintain certain amount of discipline in order to work successfully.
i) Definition
The word `misconduct'' has not been defined either in the Industrial Disputes Act 1947 or in the Industrial
Employment (Standing Orders) Act, 1946. The meaning given to the word ` misconduct' in the Oxford
Dictionary in "malfeasance or culpable neglect of an official in regard to his office". The expression is also
used in the sense of "improper misconduct" or "wrongful behaviour In Ramnath Ayyar, Law Lexicon, it has
been stated that the term misconduct implies wrongful intention and not a mere error of judgement. In
"Words and Phrases", permanent edition, the meaning given to `misconduct' is: Improper or wrongful
behaviour or unlawful behaviour or conduct of malfeasance [Kanshi Parsad Saxena v. State of U. E, (1967)2
L.L.J., 589]. In Ballentine's Law Dictionary, 1981, p. 390 it has been defined as a transgression of some
established and defined rule of action, where no discretion is left except what necessity may demand: It is a
violation of definite law, a forbidden act. It differs from carelessness". The word `misconduct' has been
defined by the Calcutta High Court in Bengal Nagpur Rly. Co. Vs. Moolji, A.I.R. 1930, Cal. 815 to mean
"The intentional doing of something which the doer knows to be wrong, or which he does wrecklessly, not
caring what the results may be" . So the word misconduct is a generic term while the specific misconducts
like insubordination, neglect of work etc. are species thereof (G.W Misra v. Union of India, 1961(3) F.L.R.
195). Mere negligence is not misconduct. Misconduct is a specific word and it cannot be mere inefficiency
or slackness. It is something far more positive (Presidency Talkies Vs. M.S. Natrajan, A.I.R. 1969, Mad.
121).
The following three different meanings of the word "misconduct" have been given by the Supreme Court:
a. Misconduct is not established by proving even culpable negligence. It is something opposed to accident
or negligence and is doing of something which the doer knows to be wrong, or which he does recklessly
not caring what the result will be.
b. Misconduct is distinguished from accident and is not far from negligence-not only gross and culpable
negligence, and involves that a person misconduct, himself when it is `wrong conduct on his part in the
existing circumstances to do or fail or omit to do a particular thing or to persist in the p act, failure or
omission or acting with carelessness. It is incorrect that misconduct only refers to acts of gross or
culpable negligence and not to mere negligence.
c. Misconduct does not ordinarily cover acts of negligence. The test of misconduct is not what a
reasonable man would have done in the circumstances. It means that a servant is guilty of something
which was inconsistent with the conduct expected of him by the rules of the company.
Thus whether the mere negligence is misconduct or not will depend upon the nature of negligence and the
requirement of the employment relationship.
ii) Types of Misconduct
There are various types of misconducts which a worker may commit. They are generally given in the
standing orders of the establishment, and it is only for these that a worker can . be punished (Management of
Debranpur Division v. Labour Court, A.T.R. 1967, Ass. 68; Andhra Scientific Co. Ltd. v, Rao, 1961 11
L.L.J. 117, S.C.). However where there are no standing orders in the establishments, the model standing
orders [C1. 14(3) of the model standing orders has given acts or omissions which will constitute
misconduct], in schedule I to the Industrial. Employment (Standing Orders) Act, 1946 shall apply.
iii) Misconduct in Model Standing.
Orders Industrial Employment (Standing Orders) Central Rules, 1946 have been framed by the Central
Government in exercise of the powers. conferred by Section 15 (2)(b) of the , Industrial Employment
(Standing Orders) Act, 1946--Schedule I appended to the Central Rules, specify the model standing orders
in respect 'of industrial establishments not being ' the industrial establishments in coal mines. Under the
model standing orders the following acts and omissions are misconducts: (O.P. Malhotra, `The Law of
Industrial Disputes', N.M. Tripathi Private Ltd., Bombay, 1981, P. 750-751)
a) Willful insubordination or disobedience, whether alone or in combination with others ,to any lawful and
reasonable order of a superior.
b) theft, fraud or dishonesty in connection with the employer's business or property.
c) willful damage to or loss of employer' s goods or property.
d) taking or giving bribe or any illegal gratification.
e) habitual absence without leave or absence without leave for more than ten days.
f) habitual late attendance.
g) Riotous, or disorderly behaviour during working hours at the establishment or any act subversive of
discipline.
 h) habitual negligence or neglect of work.
i) frequent repetition of any act or omission for which a fine may be imposed to a maximum of 2% of the
wages in a month; and
j) striking work or inciting others or strike work in contravention of the provisions of any law or rule
having the force of law.
The Bombay High Court in Sharda Prasad, Tewari v. Central Railway, (1960, 1 L.L.J. 167 Bombay)
enumerated broadly the following specific illustrative cases of acts of misconduct, the commission of which
would justify dismissal of the delinquent employee are:
1. Where the act or conduct prejudicial or likely to be prejudicial to the interests, or reputation of the
master.
2. Where the act or conduct inconsistent or incompatibly with the due or peaceful discharge of his duty to
his master.
3. An act or conduct making it unsafe for the employer to retain him in service.
4. An act or conduct making it unsafe for the employer to retain him in service.
5. An act or conduct of the employees which may make it difficult for the master to rely on faithfulness of
the employee.
6. An act or conduct of the employee opening .before him temptation for not discharging his duties
properly.
7. An abusive act or an disturbing the peace at the place of employment.
8. Insulting or insubordination to such. a degree as to be incompatible with the continuance of the relation
of master and servant.
9. Habitual negligence in respect of the duties for which the employee is engaged; and
10. An act of neglect, even though isolated, which tends to cause serious consequences.
WORKERS PARTICIPATION IN MANAGEMENT

I) INTRODUCTION AND MEANING

Workers participation in management refers to the participation o f non-managerial employees in the

decision-making process of the organisation. Workers participation gives employees the mental and
psychological satisfaction and thereby increase their involvement in the affairs o f the organization. Workers
participation in management is the most accepted principle of industrial relations in modern industry
throughout the world and in India too. In the words of Keith Davis “Participation is a mental and emotional
involvement of a person in a group situation which encourages to contribute to group goals or objectives
and share responsibilities.” According to the British Institute of Management Workers participation in
management is the practice in which employees take part in Management decisions and it is based on the
assumption o f commonality of interest between employer and employee in furthering the long term
prospects of the enterprise and those working in it. Sawtell defined participation as any or all the processes
by which the employees other than managers contribute positively towards the reaching o f managerial
decisions which affect their work. Workers participation is a system where the workers get the rights to
participate in decisions on issues which are of concern to the workers like wages, working conditions,
safety, welfare, sharing o f gain, production related aspects, incentives and allowances were considered to
be legitimate areas of workers concern and therefore workers should be consulted when these are
determined. Workers participation in management is one of the important aspects of industrial democracy. It
is distribution of social power in industry so that the power is shared among all those who are engaged in
work rather than power being concentrated only in the hands o f a few managers. Participation is a system of
communication and 76 consultation either formal or informal by which employees can express their
opinions and ideas and contribute to managements decisions. Workers participation is a method of
providing opportunities for all the members o f the organisation to contribute his mental ideas along with his
physical efforts towards the improvement o f organisational effectiveness as well as enhancing his own
economic welfare. Better participation and greater responsibility in the decision making process on part of
the general workers will perhaps develop their organisational loyalty, confidence, trust involvement and a
sense of responsibility towards supervisors, managers and the organisations in general. Participation has to
be done at different levels of management.
a) At the shop floor level.
b) At the department level and
c) At the board level.
The decision making at these different levels would assume different levels would assume different patterns
in regard to policy formulation and execution. When workers participate in decision-making and they have
to commit themselves for the implementation o f decisions made. They become more responsible and
involved. Workers participation in management is a humanitarian approach to the labour class giving them
new set of values giving them a social status, base and a place in the industrialized society.

II) OBJECTIVES OF WORKERS PARTICIPATION IN MANAGEMENT

The objectives o f workers participation in management may vary from country to country, state to state,
and from industry to industry depending upon the quality of manpower, level of technology, level o f
competition socio-economic status, political philosophy, attitude of the working class and the industrial
relations scene.

Though there are so many factors governing the objectives of workers participation some common
objectives are:

1. To prevent workers from exploitation by the management or by the owners of the organisation.

2. To have democracy in the organization.

3. To have proper development of the working class.

4. To resolve conflicts and differences between management and employees in a democratic manner.

5. To create in employees a sense of participation in industry.

6. To encourage suggestions from employees.

7. To improve the working and living conditions of employees.

8. To promote better understanding between labours and management on the various issues o f the
organisations.

9. To give employees a better understanding o f their role in the working of the industry.

10. To give the employees an opportunity for self expression leading to industrial peace, good relations and
increased co-operation.

Ill) LEVELS OF PARTICIPATION

There is no hard and fast rule as to which level o f management, workers participation in management
should be introduced. In fact participation is possible at all levels of management. The only difference is
that o f degree and nature of application. For example, it may be light or not so vigorous at the top level and
may be very strong and vigorous at a lower level. A lot depends upon the nature of work, nature of
fiinctions, quality o f manpower, strength of workers, attitude of trade unions, attitude of management and
the organisational culture. There are other factors which are also responsible for the application of workers
participation in management like the government policy on labour. Industrial Acts, phases of trade cycle,
economic and political stability and situation. Workers participation is more o f a balancing situation. When
there is more use o f authority in decision making participation in management will be negligible but when
the use of authority is in small proportion, participation will be maximum. In between the two elements
more use of authority and less use o f authority the nature of participation will also depend upon the type of
issues, attitude of employees, management culture and the past experience of management. Broadly
speaking there are five levels of workers participation in management. 1. INFORMATION
PARTICIPATION LEVEL

Information participation ensures that the employees are in a position to receive information and express
their views pertaining to the matters of general and economic importance. The management depends upon
the joint committee for informing the workers about the business conditions and also informs them about the
various changes put into effect in the working of the organisation.

2. ASSOCIATIVE PARTICIPATION LEVEL

In this level o f participation members have the right to receive information discuss and give suggestions on
the general and economic conditions of the organisation like production, markets, finance and technology
affecting the position of the organisation or organisations profit and loss account. The workers have the
right to receive information and discuss important matters like change in the methods of production,
expansion o f business or closing of a particular unit. The workers not only receive information and discuss
the issues but when suggestions are made it is binding on the management.

3. CONSULTATIVE PARTICIPATION LEVEL In such level of participation workers are consulted on the
matters of employee welfare such as work, safety, health and training. It involves a higher degree o f sharing
o f views of the workers and giving them an opportunity to express their feelings and opinions. In this level
of participation it is the managements prerogative to accept the suggestions of the workers given at the
participative forum. Workers suggestions are only o f advisory nature.

4. ADMINISTRATIVE PARTICIPATION LEVEL

Administrative participation gives a greater degree of sharing o f authority and responsibility o f

management functions. The issues taken at this level are welfare, safety, training, preparing work schedules,
working hours, incentives, holidays and rewards for valuable suggestions. In this level of participation
alternatives are given by the management and the workers select the best from those decided for smooth
implementation and efficient administration.

5. DECISIVE PARTICIPATION LEVEL

This is the highest form o f participation where decisions are taken jointly on the matters relating to
production, welfare, economic, financial and administrative policies. Delegation o f authority and
responsibility o f managerial fiinctions to the workers is maximum at this level of participation. When
 participation is done at this level it speaks of democracy and the democratic style o f management. It also
shows the faith and trust between management and the employees.

Workers Participation in Management in Indian Industries

Workers’ participation in Management in India was given importance only after Independence. Industrial
Disputes Act,1947 was the first step in this direction, which recommended for the setting up of works
committees. The joint management councils were established in 1950 which increased the labour participation
in management. Since July 1975 the two-tier participation called shop councils at shop level and Joint councils
were introduced. Workers’participation in Management Bill, 1990 was introduced in Parliament which provided
scope for up liftment of workers.
Reasons for failure of Workers participation Movement in India:
1. Employers resist the participation of workers in decision-making. This is because they feel that workers are
not competent enough to take decisions.
2. Workers’ representatives who participate in management have to perform the dual roles of workers’
spokesman and a co-manager. Very few representatives are competent enough to assume the two
incompatible roles.
3. Generally Trade Unions’ leaders who represent workers are also active members of various political parties.
While participating in management they tend to give priority to political interests rather than the workers’
cause.
4. Schemes of workers’ participation have been initiated and sponsored by the Government.However, there has
been a lack of interest and initiative on the part of both the trade unions and employers.
5. In India, labour laws regulate virtually all terms and conditions of employment at the workplace. Workers do
not feel the urge to participate in management, having an innate feeling that they are born to serve and not to
rule.
6. The focus has always been on participation at the higher levels, lower levels have never been allowed to
participate much in the decision-making in the organizations.
7. The unwillingness of the employer to share powers with the workers’ representatives, the disinterest of the
workers and the perfunctory attitude of the government towards participation in management act as
stumbling blocks in the way of promotion of participative management.
Measures for making Participation effective:
1. Employer should adopt a progressive outlook. They should consider the industry as a joint endeavor in
which workers have an equal say. Workers should be provided and enlightened about the benefits of their
participation in the management.
2. Employers and workers should agree on the objectives of the industry. They should recognize and respect
the rights of each other.
3. Workers and their representatives should be provided education and training in the philosophy and process
of participative management. Workers should be made aware of the benefits of participative management.
4. There should be effective communication between workers and management and effective consultation of
workers by the management in decisions that have an impact on them.
5. Participation should be a continuous process. To begin with, participation should start at the operating level
of management.
6. A mutual co-operation and commitment to participation must be developed by both management and labour.
Modern scholars are of the mind that the old adage “a worker is a worker, a manager is a manager; never the twain
shall meet” should be replaced by “managers and workers are partners in the progress of business”

Forms of Workers Participation in Management in India

 Forms of workers’ participation in management
The various forms of workers’ participation in management currently prevalent in the country are:
1. Suggestion schemes: Participation of workers can take place through suggestion scheme. Under this method
workers are invited and encouraged to offer suggestions for improving the working of the enterprise. A
suggestion box is installed and any worker can write his suggestions and drop them in the box. Periodically
all the suggestions are scrutinized by the suggestion committee or suggestion screening committee. The
committee is constituted by equal representation from the management and the workers. The committee
screens various suggestions received from the workers. Good suggestions are accepted for implementation
and suitable awards are given to the concerned workers. Suggestion schemes encourage workers’ interest in
the functioning of an enterprise.
2. Works committee: Under the Industrial Disputes Act, 1947, every establishment employing 100 or more
workers is required to constitute a works committee. Such a committee consists of equal number of
representatives from the employer and the employees. The main purpose of this committee is to provide
measures for securing and preserving amity and good relations between the employer and the employees.
Functions: Works committee deals with matters of day-to-day functioning at the shop floor level. Works
committees are concerned with:
o Conditions of work such as ventilation, lighting and sanitation.
o Amenities such as drinking water,canteens, dining rooms, medical and health services.
o Educational and recreational activities.
o Safety measures, accident prevention mechanisms etc.
o Works committees function actively in some organizations like Tata Steel, HLL, etc but the progress of
Works Committees in many organizations has not been very satisfactory due to the following reasons:
o Lack of competence and interest on the part of workers’ representatives.
o Employees consider it below their dignity and status to sit alongside blue-collar workers.
o Lack of feedback on performance of Works Committee.
o Undue delay and problems in implementation due to advisory nature of recommendations.
3. Joint Management Councils: Under this system Joint Management Councils are constituted at the plant
level. These councils were setup as early as 1958. These councils consist of equal number of representatives
of the employers and employees, not exceeding 12 at the plant level. The plant should employ at least500
workers. The council discusses various matters relating to the working of the industry. This council is
entrusted with the responsibility of administering welfare measures, supervision of safety and health
schemes, scheduling of working hours, rewards for suggestions etc.

Wages, bonus, personal problems of the workers are outside the scope of Joint management councils. The council
is to take up issues related to accident prevention, management of canteens,water, meals, revision of work rules,
absenteeism, indiscipline etc. the performance of Joint Management Councils have not been satisfactory due to
the following reasons:
o Workers’ representatives feel dissatisfied as the council’s functions are concerned with only the welfare
activities.
o Trade unions fear that these councils will weaken their strength as workers come under the direct
influence of these councils.
4. Work directors: Under this method, one or two representatives of workers are nominated or elected to the
Board of Directors. This is the full-fledged and highest form of workers’ participation in management. The
basic idea behind this method is that the representation of workers at the top-level would usher Industrial
Democracy, congenial employee-employer relations and safeguard the workers’ interests. The Government
of India introduced this scheme in several public sector enterprises such as Hindustan Antibiotics, Hindustan
 Organic Chemicals Ltd etc. However the scheme of appointment of such a director from among the
employees failed miserably and the scheme was subsequently dropped.
5. Co-partnership: Co-partnership involves employees’ participation in the share capital of a company in
which they are employed. By virtue of their being shareholders, they have the right to participate in the
management of the company. Shares of the company can be acquired by workers making cash payment or
by way of stock options scheme. The basic objective of stock options is not to pass on control in the hands of
employees but providing better financial incentives for industrial productivity. But in developed countries,
WPM through co-partnership is limited.
6. Joint Councils: The joint councils are constituted for the whole unit, in every Industrial Unit employing 500
or more workers; there should be a Joint Council for the whole unit. Only such persons who are actually
engaged in the unit shall be the members of Joint Council. A joint council shall meet at least once in a
quarter. The chief executive of the unit shall be the chairperson of the joint council. The vice-chairman of the
joint council will be nominated by the worker members of the council. The decisions of the Joint Council
shall be based on the consensus and not on the basis of voting.
In 1977 the above scheme was extended to the PSUs like commercial and service sector organizations employing
100 or more persons. The organizations include hotels, hospitals, railway and road transport, post and telegraph
offices, state electricity boards.
7. Shop councils: Government of India on the 30th of October 1975 announced a new scheme in WPM. In
every Industrial establishment employing 500 or more workmen, the employer shall constitute a shop
council. Shop council represents each department or a shop in a unit. Each shop council consists of an equal
number of representatives from both employer and employees. The employers’ representatives will be
nominated by the management and must consist of persons within the establishment. The workers’
representatives will be from among the workers of the department or shop concerned. The total number of
employees may not exceed 12.
Functions of Shop Councils:
1. Assist management in achieving monthly production targets.
2. Improve production and efficiency, including elimination of wastage of man power.
3. Study absenteeism in the shop or department and recommend steps to reduce it.
4. Suggest health, safety and welfare measures to be adopted for smooth functioning of staff.
5. Look after physical conditions of working such as lighting, ventilation, noise and dust.
6. Ensure proper flow of adequate two way communication between management and workers.

LABOR MARKET :-
The market in which workers compete for jobs and employers compete for workers. It acts as the external
source from which organizations attract employees. These markets occur because different conditions
characterize different geographical areas, industries, occupations, and professions at any given time.
Labor Market Related Terms
1- Labor Market:
A labor market is defined as a pool of all potential workers who compete for jobs. It also includes the employers
who compete for workers. Labor markets are based on the supply and demand of labor in a country or a specific
location that are able and willing to work.
2- Labor Force:
Labor force includes all persons classified either as employed or unemployed during a specified period of time,
usually a day or a week. Labor force can be categorized as self-employed, wage and salary earners, casual
workers and unemployed.
3- Casual Workers:
Casual workers are those workers who are generally employed by small entrepreneurs on daily or weekly basis
on a low wage rate. They are not entitled to any paid holiday leave or paid sick leaves.
4- Unemployed persons:
The persons in the labor market who are without work, that is, without paid employment or self-employment
and are currently either available for work or are seeking any work are considered to be unemployed.
5- Employment rate:
It is ratio of employed persons to the total labor force. It is the percentage of working age people who have jobs
or are employed.
6- Labor force participation rate:
It is the number of persons in the labor force as a percentage of the working-age population. The working-age
population is the population above a certain reference age like 15 years old and over or 15–64, etc
7- Unemployment rate:
It is the ratio of unemployed people to the total labor force
8- Underemployed persons:
who are employed, but not in the desired capacity, whether in terms of compensation, hours, or level of skill
and experience. The skills of such persons are underutilized, for example paying low wages to a highly skilled
employee. Underemployment also refers to a situation where a major portion of labor force is unemployed.
9- Underemployment rate:
It is the ratio of underemployed to either total labor force or total employment.
Labor Market in India
The Indian labor market can be categorized into three sectors:
Rural workers, who constitute about 60% of the workforce
Organized of the formal sector, that constitutes about 8% of the workforce.
Urban unorganized or informal structure which represents the 32% of the workforce.
Categories of Labor force
Self Employed Workers
Wage And Salary Earners
Casual Workers
Unemployed Workers
Estimated Increase In Labor Force
The chart below describes the estimated increase in the number of labors from 1977-78 to 2004-05. The labor
force has grown from 276.3 million to 385.5 million between 1977-78 and1993-94 showing an annual growth
rate of 2.1%. During the year 1999-2000, the workforce was estimated to be 407 million. In 2004-05 the labor
market consisted of 430 million workers and has grown up to 500 million in 2006.
The Labor Force In Year 2006
It has grown up to 509.3 million out of which 60% are in agriculture, 12% are employed in industries and the
residual 28% are in services.
LABOUR TURNOVER :
Turnover means “change”. A change in the financial status of an organization is called “the financial turnover”.
A change in the number of employees of an organization is called “The labor turnover”
REASONFOR LABOUR TURNOVER:
Avoidable Reasons
(low job satisfaction, low pay, risky or repetitive work etc.).
Unavoidable reasons
(death, retirement, accident, poor health etc.).
Methods Used To Estimate Turnover:
Every good organization prepares a report of labor turnover to refer and rectify the avoidable causes of
turnover. Below are methods used to estimate turnover: Average No. = (No. of employees at start + No. of
employees at end) / 2
1- Separation Method/Rate:
(Number of employees separated in a period / Average number of employees in the period ) * 100
2- Replacement Method/Rate:
(Number of employees replaced in a period / Average number of employees in the period) * 100
3- Flux Method/ Rate:
(No. of employees separated + No. of employees replaced) / Average number of employees in the period } *
100
Factors could be the cause of a high level of Labour
Turnover :
a) Dissatisfaction on account of insufficient wages leading to employees moving to competitors
b) Low level of motivation from employers’ side and poor morale within the workforce in a specific industry.
c) Recruiting and misplacement of employees resulting in their mobility in search of suitable employment.
d) A floating local labour market offering better and more attractive opportunities to employees.
HOW TO REDUCE LABOUR TURNOVER
Following action may be taken to reduce labour turnover:
Pay Problem – increasing pay scale & improving pay structure to remove inequities
Employees Learning to further their Career – providing better career opportunities& ensuring the
job, opportunities for training & development program, implement promotion
Employees Leaving due to Conflict – more effective procedure for handling grievances & improving
communication, using resolution & teambuilding techniques, reorganisation of work.
The Induction Crisis – improving recruitment & selection process, ensure job requirement, developing
better induction & initial training program
Shortage of Labour – improving recruitment, selection & training, intoducing better method of
planning & scheduling work smooth out peak loads.
PRESENTEEISM
Presenteeism is a term used by human resource professionals to describe circumstances in which
employees come to work even though they are ill, posing potential problems of infection and lower
productivity. When employees go to work sick they risk infecting their co-workers and will
most likely not be as effective or productive in their work Stress Shift work
ABSENTEEISM :
In every organisation an employee / worker has some definite working hours with certain responsibility
(work assigned) and if the worker is not present in their working hours that called absenteeism in the
organisation.
FACTORS IN ABSENTEEISM :
Moral
Work schedule flexibility
1- Alternative Work Arrangements
2. Compressed Work Week
3. Job Sharing, and
4. Telecommuting
CAUSES OF ABSENTEEISM :
Personal Factors - age, marital status, health, education, hobbies, extra curricular actitvites.
Work Environment – working conditions, ralation with coworkers & seniors and their attitude
Home Conditions – distance from residence, mode of conveyance, family size, family problems &
responsibilities
Economic Issues – subsidiary economic interests
Regional Aspects – legislations, politics, geographical situations
Organisational Features – type & size of company, work load, nature of work, shift arrangements,
management attitude, personnel policies, leave facilities and medical benefits
Social Reasons – religion, community obligations, customs festivals, marriage and death