Preventive Machinery of Industrial Disputes

Prevention is always better than cure. Preventive steps should, therefore, to be taken so
that industrial disputes do not occur. The following measures can be taken to prevent
disputes in industry.
A. Code of conduct

Each individual organism its code or may follow the code of discipline in industry
formulated by the govt: and made applicable to industry and workers from June 1st 1958.
It aims at preventing disputes through negotiations without the interference of an outside
agency.
Objectives
 To avoid work stoppages
 To maintain discipline in industry
 Eliminate all forms of coercion and violence in IR
 Secure settlement of disputes and grievances by negotiation, conciliation and
arbitration.
 Promote constructive co-operation between the parties concerned at all levels.
 Improve motivation & communication
 Improve productivity and compensation of employees.
A. Workers Participation in Management

It is a method whereby the workers are allowed to be consulted and to have a say in
the management of the unit. WPM is essentially the step promoting Industrial
Democracy. It is the modern trend in the industrial world both developed and developing
countries .WPM means sharing of profit and pain.
“Applied to industry the concept of participation means sharing the decision
making power by the ranks of an industrial organization through their proper
representatives at all appropriate levels of management, in the entire range of managerial
actions.”
 Dr. V.G. Mehtras
The important schemes of workers participation are:-
 Joint Consultation
 Works committee
 Joint management council
 Shop council
 Joint council

1. Joint Consultation
It is a process where by employer consults the workers either directly
or through their representatives and seeks their opinion on various issues while
retaining to himself the right of taking final decisions. it is carried out through joint
consultation committees consisting the representatives of both the employer and
workers.

2. Work Committees
Every industrial undertaking employing 100 or more workers is
under an obligation to set up a works committee consisting equal number of
representatives of employer and employees. The main purpose of such committees is
to promote industrial relations. According to Indian Labour Conference work
committees are concerned with:-
 Administration of welfare & fine funds.
 Educational and recreational activities.
 Safety and accident prevention
 Occupational diseases and protective equipment.
 Conditions of work such as ventilation, lightening, temperature &
sanitation including latrines and urinals.
 Amenities such as drinking water canteen, dining rooms, medical &
health services.
The following items are excluded from the preview of the work committees.
1. Wages and allowances
2. Profit sharing and bonus
3. Programs of planning and development
4. Retirement benefits
5. PF and gratuity
6. Housing and transport schemes
7. Incentive schemes
8. Retirement and layoff

LAYOFF
Inability of the employer in certain conditions. it is a measure to cope up with the
temporary inability of an employee to offer employment to a workman to keep the
establishment as a going concern.
3. Joint Management Council
Just to make a start in labour participation in management, the govt:
suggested in its Industrial Resolution 1956 to set up joint management councils. It
consists of equal numbers of workers and employers (minimum 6 & maximum 12)
decisions of the JMC should be unanimous and should be implemented without any
delay. JMC members should be given proper training.
JMC should look after 3 main areas:-
1. information sharing
2. consultative
3. administrative
 Representation of workers to the JMCs should be based on the nomination by
the representation.
Objectives
 Satisfy the psychological needs of workers
 Improve the welfare measures
 Increase workers efficiency
 Improve the relation and association between workers, managers and
promoters.
JMC deals with matters like:-
 Employee welfare
 Apprenticeship scheme
Causes of failure of JMCs:-
 Attitude of animosity
 Crisis of confidence in elected representatives
 Limited scope of JMC
 Level of participation
The performance of JMC is not satisfactory due to:
• The absence of representative unions made it difficult for the council to
work smoothly.
• The leaders feel that the council would weaken their hold over workers
• Managers feel that it is very difficult to convince uneducated representatives
of workers.
• Managers feel that with work committees and collective bargaining there is
no need for this councils.

4. Shop Council
Shop councils have been established in the manufacturing and mining
industries employing 500 or more workers in private, public and joint sectors.
 These councils assist the mgmt in achieving production targets, improving
production, productivity and efficiency, eliminating wastage and in achieving
optimum utilization of machinery and manpower.
Features
• All decisions of a shop council shall be on the basis of consensus and not by the
basis of voting that either party may refer the unsettled matters of the joint council
for consideration.
• There will be shop council for each department or one council for more
departments considering the number of workers employed.
• The number of members in the council may be decided by management in
consultation with recognized unions. The total members may not generally exceed
12.
• A shop council once formed shall function for a period of two years. It will meet
as frequently as possible at least once in a month.
• Each shop council shall consist of equal number of representatives of employers
and employees.
• Every decisions of a shop council shall be implemented by the parties concerned
within a period of one month, unless otherwise stated in the decision itself and
compliance report shall be submitted to the council.
FUNCTIONS
1. Assist management in achieving production targets.
2. Identify areas of low productivity.
3. Improve production
4. Suggest healthy, safety, welfare measures.
5. Assist in maintaining general discipline in the shop or department.
6. Physical conditions of work environment
5. Joint Councils
JC are set up for the whole unit and deals with matters relating optimum production
and efficiency and the fixation of productivity norms for man and machine for the as a
whole. in every industrial unit employing 500 and more workers there should be a Joint
Council for the whole unit.
Features
• Members of the council must be actually engaged in the unit.
• The chief executive of the unit will be the chairman of the council and vice
chairman will be nominated by worker members.
• Term of the council will be two years.
• JC shall meet at once in a quarter.
• Decision of the council will be based on consensus and not on voting.
FUNCTIONS
1. Optimum use of raw materials and quality of finished products
2. Optimum production, efficiency and function of productivity norms of
man and machine as a whole.
3. Preparation of schedules of working hours and of holidays.
4. Adequate facilitates for training.
5. Rewards for valuable and creative suggestions received from workers.

A. Collective Bargaining

Collective bargaining refers to "a process by which employers on the one hand and
representatives of the employees on the other, attempt to arrive at agreements
covering the conditions under which employees will contribute and be compensated
for their services”

Michael. J. Jucius

“It is the process in which the representatives of labour organizations

and the representatives of business organization meet and attempt to
negotiate a contract or agreement which specifies the nature of the
employer and employee union relationship.”

EdwinFlippo
The term collective bargaining typically refers to the negotiation, administration and
interpretation of a written agreement between two or more people.
OBJECTIVES
 Ensure the participation of Trade Unions in the industry
 Settle disputes relating to wages and working conditions.
 Protect the interests of the workers through collective action.
 Prevent unilateral actions on the part of employees.
Conditions essential for successful collective bargaining

 Favorable political climate

 Freedom of association
 Willingness to give & take
 Problem solving attitude
 Availability of data
 Fair labour practices

PROCESS OF COLLECTIVE BARGAINING

1. Preparation for negotiation

 Careful advance preparation by employers and employees are necessary for
negotiation. it is of two types:
a) From the management side.
 Prepare specific proposals for changes in the contract language.
 determine the general size of the economic package of the company
proposes to offer
 Prepare statistical displays and support for use in negotiations.
b) From the employee side
 Attitudes and desires of the employees.
 Financial position of the company and its ability to pay.
 Attitude of management towards various issues as reflected in past
negotiations or inferred from negotiations in similar companies.

1. Identifying bargaining issues

 wage related issues

 supplementary economic benefits
 administrative issues
 institutional issues
2. Negotiating
The negotiating phase begins with each side presenting its initial
demands. Negotiation goes on for days until the final agreement is
reached. The success of negotiation depends upon skills and abilities of
negotiators.

3. Settlement and contract agreement

Agreement can be made on a temporary basis. After an initial
agreement has been made the two sides usually return to their respective
constituencies to determine whether they have informally agreed upon is
acceptable. in such case before the expiry of both the parties consult each
 other and can terminate or renew the agreement depending upon the
circumstances.
4. Ratifying the agreement
The union negotiating team explains and puts the agreement to the
union members for the vote. if voted agreement is formalized into a
contract. it is important the contract must be clear and precise.
5. administration of the agreement
Signing the agreement is not the end of the process rather it is the
bargaining of the process. The agreement must be implemented according
to the letter and spirit of the provisions of the agreement. Management is
primarily responsible for implementing the agreement, which must be
communicated to all levels. Faulty implementation or violation of any
provision leads to disputes.

Environment
Environmental factors include:
 Type of bargaining structure that exists between the union and the
company.
 Type of union- management relationship which exists
D. Grievance Redresal Procedure
Grievances are symptoms of conflicts in the enterprise. So they
should be handled very promptly and efficiently. It is a method by which
an individual or group may express a complaint to an agency or institution
alleged to be violating a particular rule and without fear of reprisal. The
Indian Labour Conference in 1958 evolved a code of discipline which was
ratified by the national trade union and employers’ organizations. Under
this code, both the parties voluntarily agree to maintain and create an
atmosphere of mutual trust and cooperation in the factory and to settle all
the disputes and grievances by mutual negotiation, conciliation and
voluntarily arbitration and also avoid direct action.
E. Tripartite Bodies
 Various bodies composed of the representatives of employers,
employees and the government has been set up for consultation and
discussion on questions affecting labour. The Indian Labour conference,
standing Labour commission, Wage Boards and Industrial Committees
operate at the central level. At the state level, State Labour Advisory
Boards have been set up. All these bodies play an important role in
reaching at agreements on various labour matters. The recommendations
of these bodies are advisory in nature but carry a great weight on
employers, trade unions and the government. All these bodies constitute
the consultative machinery for the private sector.

F. Standing Orders
To avoid frictions amongst employers and workmen over the terms of
employment, Govt: enacted the Industrial Employment (Standing Orders) Act 1946. It
refers to the rules and regulations which govern the conditions of employment of
workers. It also specifies the duties and responsibilities of both the employer and
employees and regulates standards of their contacts. The main objective of this act is to
prevent the disputes as soon as it’s arises by framing model rules for maintaining
discipline and better relation. This Act applies to all establishments employing 100 or
more workers.
Under this act, each employer has to have their standing orders certified from the
certifying officer to make them effective in the establishment. Labour Commissioner or
Regional Labour Commissioner or any other officer appointed for this purpose may be
certifying officer under the act.
G. National Arbitration Promotion Board
The Truce Resolution 1962 and the code of Discipline as evolved in 1958
recognized the principle of voluntary arbitration.
It was agreed that any disputes would be referred to voluntary arbitration if
conciliation efforts fail.
The govt: of India took note of the intension of both the industrial partners and set up
the NAPB to promote voluntary arbitration to settle industrial disputes. the board
 comprises of the representatives of employers’ and employees’ organizations, Public
Undertaking and the central and State Governments. The Board attempts to ensure
that employers and workers take greater recourse to the voluntary approach to settle
industrial disputes.
H. The Implementation Machinery
The Implementation and Evaluation Committee has been set up at the
centre:-
 To ensure proper implementation of the Code of Conduct, the Code of Discipline,
Labour laws, awards and agreements with a view to reducing at source the main
cause of industrial disputes.
 To take preventive action by settling disputes before they assume serious
proportions and deal with those that have defied settlement for a long time.
 To evaluate the impact of major strikes, lockouts and disputes and fix the
responsibility for them.
 To evaluate the working and implementation of important labour legislation,
awards and policy decisions in order to assess the extent to which these have
produced the desired

results and to suggest the measures that may be taken to effect improvement in them.

The Central Organizations of workers and employers have set up machinery to screen
cases of industrial disputes before they are taken to courts with a view to reducing
litigation. As regards the cases which are already pending before the courts, the
implementing machinery attempts out of court settlements by means of persuasion.

I. National Arbitration Promotion Board

 The Truce Resolution 1962 and the code of Discipline as evolved in 1958 recognized
the principle of voluntary arbitration. It was agreed that any disputes would be
referred to voluntary arbitration if conciliation efforts fail. The govt: of India took
note of the intension of both the industrial partners and set up the NAPB to promote
voluntary arbitration to settle industrial disputes.

SEMINAR REPORT ON INDUSTRIAL RELATIONS

Submitted To: DOMS

Submitted By: SANGEETHA.S
SREE NARAYANA GURUKULAM COLLEGE OF ENGINEERING

Date of submission: 4-10-2006