INDUSTRIAL RELATIONS

Arun Monappa

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Industrial Relations:-

Industrial relation means the relationship between employees &

management in the day-to-day working of the industry. ILO IR
deals with either the relationship between the state & employers
& workers organizations or the relation between the occupational
organizations themselves. Industrial relations are the relations
mainly between employees & employer. IR are governed by the
system of rules & regulations concerning work, work place, &
working community. The main purpose is to maintain
harmonious relations between employees & employer by solving
their problems through grievance procedure & collective
bargaining. The government influences & shapes IR through
industrial relations policies, rules, agreements, mediator, awards
etc.
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IR- Background:-

IR plays a crucial role in establishing & maintaining industrial

democracy. In India, it has passed through several stages. A
number of social, economic & political- have influenced IR in
India. In the pre-independence days, workers were hired &
fired as the principle of demand & supply governed IR. The
employer was in a commanding position, & the conditions of
employment & wages was very poor. When these conditions
continued it pave the way for revolutionary movements. There
were hardly any laws to protect the interests of workers except
the Employers & Workmen Disputes Act, 1860, which was used
to settle wage disputes. In 1938, in order to meet the acute
Industrial unrest prevailing then, the Bombay government
enacted the Bombay Industrial Relations (BIR) Act.
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IR in Post-Independence Period:-

- The enactment of the Industrial Disputes Act, 1947, which not

only provides for the establishment of permanent machinery for
the settlement of industrial disputes but also makes these awards
binding & legally enforceable;

- An Industrial Conference was held in India, where an appeal

was made to labour & management in the form of an Industrial
Truce Resolution to maintain industrial Harmony;

- The setting up of the Indian Labour Conference (ILC), a

tripartite body to look into IR problems in India. It was
constituted with the objective of establishing co-operation
between the government, the employers, & the trade unions;

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- Change in the Governments attitude towards labour & their
problems. Many labour laws were enacted to protect the interests of
industrial workers during 1947-56. These laws cover many issues
concerning labour, such as wage rates, social security, paid holidays,
disciplinary matters etc.

- In 1966, the National Commission of Labour (NCL) was appointed

by the government to look into labour matters & make
recommendations. These related to the statutory recognition of a
representative union as the sole bargaining agent.

- The early 1970s witnessed considerable industrial strife & loss of a

large number of mandays. ILC which was active till 1971, did not
meet from 1972-76. When Emergency was declared in June 1975, the
National Apex Body (NAB) was set up in place of the tripartite ILC.
The NAB consisted of 23 members ( 12 representing workers & 11
representing employers). It met 6 times during 1976 for reviewing IR
& labour matters, with the government acting as an arbitrator.
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- ILC revived once again in May 1977. But after Emergency,
with the change in political leadership, there followed a period of
reconciliation & active trade union activity. The Janata
Government set up a number of committees to review IR
practices.

- To meet the situation of Industrial Strife, on 26th July, 1981, the

Government issued an ordinance to ban strikes. A new law called
the Essential Services Maintenance Act (ESMA), was also
promulgated. With this the Government now has wide-ranging
powers to intervene in IR. ESMA empowers the government to
ban strikes, lay-offs & lockouts in what it deems to be essential
services. It also empowers the government to punish any person
who participates or instigates a strike which is deemed illegal
under ESMA.
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The Second National Commission on Labour 2002 Has made the
following observations:-
- It is increasingly noticed that trade unions not normally give a
call for strike because they are afraid that a strike may lead to the
closure of the unit;
- Service sector workers are becoming increasingly disinterested
in trade union activities;
- The nature of disputes for demands is changing.

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Governments Role in IR:-

The main issue in regard to the government's role in industrial

relation is the degree of state intervention. In India, particularly
after independence, the government has been playing a
comprehensive and dominant role in shaping the patterns of
industrial relations. The government evolves through forming
norms or standards, which are in the nature of guidelines shaping
employer-employee relation. It accepts the responsibility of
ensuring conformity to these norms through the administrative
and judicial mechanism. The state intervention primarily aims
at:-Preserving industrial peace, Encouragement for mutual
settlement of disputes through collective bargaining and
voluntary arbitration, Recognition of the workers' right to
peaceful direct action, i.e., strike; and Tripartite consultation.
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Actors in the IR system:-

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Principles of Sound Industrial Relations:-
- Sound IR can only be based on Human relations & good human
relations dictate that human beings should be treated humanly which
includes respect for human dignity, fair dealing & concern for human
beings physical & social needs;
- Mutual respect, confidence, understanding, goodwill & acceptance of
responsibility on the part of both employer, management & workers in
the exercises of the rights & duties in the operation of the industry;
- A good labour policy is one of the requisite for the development of
good IR. The aim of such a policy should be to secure the best
possible co-operation of the employees. Every employee should have
the opportunity to contribute not only his services, but his suggestions
& ideas also towards the common effort;
- Similarly, there has to be an understanding between the various
organizations of employers & employees who represent the
management & workers.
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Objectives of IR:-
The primary objective of IR is to maintain congenial relations between
employees & employer.
- To promote & develop congenial labour management relations;
- To enhance the economic status of the worker by improving wages, benefits &
by helping the worker in evolving sound budget;
- To regulate the production by minimizing industrial conflicts through state
control;
- To socialize industries by making the government as an employer
- To provide an opportunity to the workers to have a say in the management &
decision-making;
- To improve workers strength with a view to solve their problems through
mutual negotiations & consultation with the management;
- To encourage & develop trade unions in order to improve the workers strength;
- To avoid industrial conflicts & their consequences;
- To extend & maintain industrial democracy.

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Conditions For Congenial IR:-

The establishment of good IR depends on the constructive

attitude on the part of both management & the unions. The
constructive attitude in its turn depends on all the basic policies
& procedures laid down in any organization for the promotion of
healthy IR. ( Faith in Collective Bargaining, Feeling of equality,
Existence of a good HR)
- Existence of Strong, Well Organized & Democratic Employees
Unions;
- Existence of Strong & Well Organized Employers Unions:
- Spirit of Collective Bargaining & Willingness to Resort to
Voluntary Organization;
- Maintenance of Industrial Peace; ( Machinery for prevention &
settlement of Industrial disputes, Authority to Government in
settling Industrial Disputes, Bipartite/Tripartite Committees etc).
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Approaches To IR:-
IR issues are complex & multifarious. They are the results of social,
cultural, economic, political & governmental factors.
- Psychological Approach to IR:-
According to psychologists, issues of IR have their origin in the
differences in the perception of management, unions & workers.
The differences arise due to differences in personalities, attitudes
etc. Similarly factors like motivation, leadership, group goals
versus individual goals etc are responsible for Industrial conflicts.

- Sociological Approach to IR:-

Industry is a social world in miniature. Organizations are
communities of individuals & groups with differing personalities,
educational & family backgrounds, sentiments etc. These
differences in individuals create problems of conflict & competition
among the members of individual society.
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- Human Relations Approach to IR:-
Human Resources are made up of living human beings but not
machines. They need freedom of speech, thought, expression,
movement etc. This approach implies that relationship between
employee & employer as between 2 human beings.

- Gandhian Approach to IR:-

Mahatma Gandhis views on IR are based on his fundamental
principles of truth, non-violence etc. Under the principle of non-
violence & truth, Gandhi meant a peaceful co-existence of
capital & labour. He advocated- Trade Unions should decide to
go on strike taking ballot authority from all workers & remain
peaceful & use non-violent methods. Workers should avoid
strikes to the possible extent. Strikes should be resorted to only
as a last resort.
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INDUSTRIAL CONFLICT

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Dispute:-

According to the Industrial Dispute Act, 1947, Industrial

Disputes means any dispute or difference between employers &
employers, or between employers & workmen or between
workmen & workmen, which is connected with the employment
or non-employment or terms of employment or with the
conditions of labour of any person.
Industrial Conflicts can be classified into 4 groups:-
- Interest disputes: These are the disputes that arise out of
deadlocks in negotiations;
- Grievance Disputes: These are the disputes that arise out of
day-to-day grievances;
- Unfair Labour Practices:
- Recognition Disputes: These are the disputes that arise due to
the recognition of trade union as a bargaining agent.
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Nature Of Conflict and Its Manifestations:-

Conflict occurs at various levels- within a person, between

members of a group & between groups. It has different
implications for individual behaviour & work group behaviour.
Whenever there are differences between the goals of separate
groups or even several individuals in a group, conflict occurs.
The 3 main groups in an industry, owners, managers, & workers
develop orientation & perceptions of their interests. The
divergent objectives by each causes friction severe enough to
lead to strikes/lockouts. These groups, organized or unorganized,
manifest their conflict in various forms, some overt while others
not quite, but there are other expressions of conflict which have
significant effects on the working of an enterprise.

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Causes of Industrial Conflicts:-

- Industrial Causes/Factors:-
An industrial matter relating to employment, work, wages, hours of
work, privileges, the rights & obligations of employees &
employers, terms & conditions of employment etc. Disputes often
arise because of- The rapidly increasing population which has no
opportunities for gainful employment, No improvement in standard
of living etc. The attitude & temperament of industrial workers
have changed because of their education, their adoption to urban
culture etc. The trade unions have often failed to safeguard the
interests of workers.

- Technological Causes:-
Unsuitable Technology i.e. difficulty in technological adaptation,
resistance to change, fear of unemployment etc.

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- Management Attitude Towards Labour:-
Management Generally is not willing to talk over any dispute with
their employees or their representatives or refer it to arbitration
even when trade unions want them to do so. This enrages the
workers. The managements insistence that they alone are
responsible for recruitment, promotion, transfer, etc & that they
need not consult their employees in regard to any of these matters
generally annoys the workers & often resort to strikes.

- Government Machinery:-
Governments conciliation machinery has settled a very negligible
number of disputes- Both employers & employees have very little
confidence in it; Both have become litigation minded; The officers
associated with conciliation proceedings have very little training in
handling the problems or disputes which are referred to them.

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- Political Causes:-
Political Instability, various parties, & their affiliations with
unions. Affiliation of the trade unions with the political party.
Each political parties to demonstrate their political strength will go
for strikes, bandh etc. which result to labour disputes & conflicts.

- Psychological Causes:-
Conflict in individual & organizational objectives, motivational
problems, personality & attitude etc.

- Market situations:- Rising prices & shortages etc.

- Other factors like rampant corruption in industry & public life,

easy money etc.

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Conflict Resolution:-
Not only employers, employees, government, but also the public
at large, are equally concerned about disputes since conflicts, if
not resolved in time, take the form of strikes or lockouts
resulting in loss towards wages, production & supply of goods.

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- Statutory Measures relate to the various machinery set up by
government under the Industrial Dispute Act, 1947 ( like labour
courts, industrial & national tribunal, committees etc) for specific
conflicts which the government refers to the respective authorities;
( Formation of Works Committees )
ID Act, 1947 was enacted to promote industrial peace by providing
appropriate machinery for amicable settlement of disputes arising
between employers & employees. Some of the principal objects of
ID Act are-
a. Measures to secure cordial relations between labour & mgt.
b. Investigation & Settlement of Industrial Disputes.
c. Prevention of illegal strikes & lockouts
d. Provision of relief in matters of lay-off & retrenchment.
Conciliation:- Conciliation is the practice by which the services of
a neutral 3rd party are used in a dispute as a means of helping the
disputing parties to reduce the extent of their differences & to arrive
at an amicable settlement of disputes & to terminate work stoppages
if they have already occurred.
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Conciliation under the ID Act, 1947:- The Act provides for
conciliation as a method for settlement of disputes. To achieve
this, the appropriate government, after notifying in the Official
Gazette, can either appoint conciliation officers of constitute a
board of conciliation. Conciliation under this provisions of the
Act, is compulsory for public services while it is not so in
private.
Court of Enquiry:- A court of enquiry is another authority set up
by the government under ID Act, for enquiring into any matter
connected with a dispute. It consists of 1 or more members,
which is decided by the appropriate government. It has to submit
its report in writing to the government within 6 months from the
commencement of the enquiry.
Arbitration:- In Arbitration the arbitrator gives his judgement on
the basis of the evidence submitted to him by employers & the
employees (unions).
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Arbitration under the ID Act, 1947:- The Act provides for voluntary
Arbitration. This can be resorted to by a mutual agreement between the
employers & the employees. If any dispute exists, it may be referred for
arbitration any time before the dispute has been sent for adjudication under
the provisions of the ID Act, 1947.
Adjudication ( Compulsory Arbitration):- It is compulsory & it is ultimate
remedy for resolving ID provided by the ID Act, 1947. The procedure of
adjudication involves compulsory attendance of witnesses, compulsory
powers of investigation etc. The Act provides the machinery of
adjudication, i.e. Labour Courts, Industrial Tribunals & National Tribunals.

Labour Court:- This is one of the adjudicatory bodies provided by the ID

Act. Labour Courts deal with matters pertaining to discharge and dismissal
of workmen, application and interpretation of Standing Orders, legality of
strikes of lock outs etc. Labour Court consist of 1 person only, who is also
called the Presiding Officer, & who is or has been a judge of a High Court.

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Industrial Tribunals:- Labour Courts and Industrial Tribunals are
set up by the Central Government and the State Government for
dealing with matters which fall in the Central and the State sphere
respectively. It deal with collective disputes such as wages, hours
of work, leave, retrenchment, closure etc.
National Tribunals:- This is the 3 rd Adjudicatory body provided by
the Act. It is only the Central Government which can constitute
them for adjudicating disputes which, in its opinion, involve a
question of national importance or any of such a nature that
Industrial establishments situated in more than 1 state are likely to
be affected by such disputes.
- Non-Statutory Measures like the Code of discipline, Workers
Participation in Management, Collective Bargaining which is
voluntary in nature are supported by government & help in
resolving this conflict. ( Negotiation Process)

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Non-Statutory Measures:-
1. Code of Discipline:
The government has set up various agencies at the Centre & State
level to implement the Code of Discipline. The Code of Discipline
provides guidelines for the employers, workers & the unions. It
stipulates that the management & the union should utilize the
existing machinery for settlement of their disputes efficiently & they
should neither resort to strike or lockouts nor unfair work practices
like go slow, coercion etc.
2. Tripartite Machinery:
It consists of the Indian Labour Conference, Standing Labour
Committee & the Industrial Committees at the Centre. There were
similar bodies which was set up to deal with specific subjects- The
National Council on Training in vocational Trades & the Central
Committee on employment deal with employment & training. SLC
advices the government on any Labour matter referred to it.
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- Labour Administration Machinery:
The Division of Jurisdiction between Centre & States is provided
by the Constitution which makes a distinction between matters
within the exclusive jurisdiction of the Centre & the State &
within the concurrent jurisdiction of the State & Centre. The
Ministry of Labour & Employment of the Central Government is
the main agency for policy formation & administration in all
labour matters. Together with the State Governments, the local
bodies & the Statutory Corporations/Boards, it sees to
implementation of these policies & the decisions of the Tripartite
Committees.
a. Directorate General of Employment & Training (DGET):-
DGET lays down policy for running of the employment
exchanges & the industrial training institutes. It also runs
Research Institutions.
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b. Office of the Chief Labour Commissioner (CLC) (Central):-
This is also called the Central IR Machinery (CIRM). His
functions will be to administer of labour laws, verification of
membership of registered unions, supervision of implementation
of the Code etc. But the main duties relate to resolving disputes.
c. The Director General of Mines Safety (DGMS):-
It looks into the working conditions & implementation of the
Mines Act, 1952, & the Maternity Benefit Act, 1961 etc.
d. The Directorate General of Factory Advice Service & Labour
Institutes:-
Provides advisory service to the factory inspectors of different
states. Conducts research in problems relating to safety, health,
welfare & productivity. It also runs Central Labour Institute &
the Regional Labour Institutes.

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Workers Participation in
Management

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Introduction:

It is a mental and emotional involvement of a person in a group

situation which encourages him to contribute to goals and share
responsibility with him. - Davis

Workers participation in management means giving scope for

workers to influence the managerial decision making process at
different levels by various forms in the organisation.

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ILO: Workers participation, may broadly be taken to cover all
terms of association of workers and their representatives with the
decision-making process, ranging from exchange of information,
consultations, decisions and negotiations, to more
institutionalized forms such as the presence of workers member
on management or supervisory boards or even management by
workers themselves.

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Objectives of Workers Participation in
Management:
- Increasing productivity for the general benefit of the enterprise,
the employees and the community.
- Giving employees a better understanding of their role.
- Satisfying the workers urge for self-expression.
- Achieving industrial peace, better relations and increased co-
operation in industry.
- Development of human personality.
- Development of leaders from within the industry.

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Levels of Workers Participation in Management:
Workers participation may exist in all levels of management, however it
may vary from management to management. Participation of workers in
management is more likely at lower level and less involvement at top level
of management.

- Information participation of workers: It ensures that employees are able

to receive information and express their views pertaining to the matters of
general economic importance.

- Consultative participation of workers: Under this kind of workers

participation in management, may act as a consultant in the matters of
workers safety, health and their welfare at workplace. Even so, ultimate
decision lie in the hands of management, only employees views are
considered as advise.

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- Associative participation of workers: This kind of workers
participation in management is next level to consultative
participation. Under associative participation of workers in
management, morally bound to accept and implement the
opinion of employees.

- Administrative participation of workers: Under this kind of

participation of workers in management, workers take part in
discharge of managerial functions. Here employees take part in
decisions, which were already taken by the management,
thereupon employees have to select the best from those decisions
for the purpose of implementation.

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- Decisive participation of workers: Decisive participation is
the highest level of workers participation in management, where
employees and management together take decisions on the
matters related to workers welfare and production related issues.

Forms of Workers Participation in Management:

The forms of workers participation in management vary from
industry to industry and country to country depending upon the
political system, pattern of management relations and subject or
area of participation.

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1. Joint consultation model: In the joint consultation model the
management consults with the workers before taking decisions. The
workers represent their view through Joint consultative Committees.
This form is followed in United Kingdom, Sweden and Poland.

2. Joint decision model: In this form both the workers and

management jointly decide and execute the decisions. This form of
participation is followed in U.S.A. and West Germany.

3. Self management of auto management: In this model, the entire

control is in the hands of workers. Yugoslavia is an example to this
model. Where the state industrial units are run by the workers under a
scheme called Self Management or Auto Management Scheme.

4. Workers representation on board: Under this method, the

workers elect their representative and send them to the Board to
participate in the decision making process.
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Workers Participation in Management in India:
WORKS COMMITTEES
The industrial disputes act, 1947, provides for the setting up of
works committee consisting of representatives of management
and employing 100 or more workmen.
FUNCTIONS:
- Conditions of work such as ventilation, lighting, temperature
and sanitation.
- Amenities such as drinking water, canteen, dining rooms, rest
rooms, medical and health services
- Safety and accident prevention, occupational diseases and
protective equipment.
- Adjustment of festivals and national holidays.
- Administration of welfare funds.
- Educational and recreational activities, such as libraries, reading
rooms, cinema-shows, sports, games, community welfare and
celebrations.
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JOINT MANAGEMENT COUNCILS:
JMCs represent a higher form of workers participation in
management. The aim is to change the social structure of
enterprises from inside. They lead the private sector to fit into the
framework of socialist order the idea that socialist order should
be achieved by gradual and peaceful changes.

Requirements:
- It must have 500 or more employees.
- It should have a fair record of industrial relations.
- It should have a strong and well organized trade union.
- Willingness of employers, workers and trade unions.
- Private employers ought to be members of the leading
employers organisation.
- The union should be affiliated to one of the central federations.

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