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Industrial Relations
Industrial relation means the relationship between employers and employees in
course of employment in industrial organisations. However, the concept of Industrial
Relations has a broader meaning. In a broad sense, the term Industrial Relations
includes the relationship between the various unions, between the state and the
unions as well as those between the various employers and the government.
Relations of all those associated in an industry may be called Industrial Relations.
According to International Labour Organisation, Industrial relations
comprise relationships between the state on one hand and the employers and
employees organisation on the other, and the relationship among the occupational
organisations themselves.
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Industrial Disputes
Industrial disputes are organised protests against existing
terms of employment or conditions of work. According to the Industrial Dispute Act,
1947, an Industrial dispute means
Any dispute or difference between employer and employer or between employer
and workmen or between workmen and workmen, which is connected with the
employment or non-employment or terms of employment or with the conditions of
labour of any person
In practice, Industrial dispute mainly refers to the strife between employers
and their employees. An Industrial dispute is not a personal dispute of any one
person. It generally affects a large number of workers community having common
interests.
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of
Industri
al
Disput
es
Labour
Model
Standi
ng
Orders
Code
of
Discipl
ine
Works
Comm
ittee
Welfar
e
Officer
s
Collect
ive
Bargai
ning
Joint
Manag
ement
Counci
ls
Sugge
stion
Schem
es
Triparti
te
Bodies
Joint
Counci
ls
1. Model Standing Orders: Standing orders define and regulate terms and
conditions of employment and bring about uniformity in them. They also
specify the duties and responsibilities of both employers and employees
thereby regulating standards of their behaviour. Therefore, standing orders
can be a good basis for maintaining harmonious relations between employees
and employers.
Under Industrial Dispute Act, 1947, every factory employing 100 workers or
more is required to frame standing orders in consultation with the workers.
These orders must be certified and displayed properly by the employer for
the information of the workers.
2. Code of Industrial discipline: The code of Industrial discipline defines
duties and responsibilities of employers and workers. The objectives of the
code are:
To secure settlement of disputes by negotiation, conciliation and
voluntary arbitration.
To eliminate all forms of coercion, intimidation and violence.
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Advantages of Arbitration:
It is established by the parties themselves and therefore both parties
have good faith in the arbitration process.
The process in informal and flexible in nature.
It is based on mutual consent of the parties and therefore helps in
building healthy Industrial Relations.
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Disadvantages:
Delay often occurs in settlement of disputes.
Arbitration is an expensive procedure and the expenses are to be
shared by the labour and the management.
Judgement can become arbitrary when the arbitrator is incompetent or
biased.
There are two types of arbitration:
a) Voluntary Arbitration: In voluntary arbitration the arbitrator is
appointed by both the parties through mutual consent and the
arbitrator acts only when the dispute is referred to him.
b) Compulsory Arbitration: Implies that the parties are required to
refer the dispute to the arbitrator whether they like him or not. Usually,
when the parties fail to arrive at a settlement voluntarily, or when
there is some other strong reason, the appropriate government can
force the parties to refer the dispute to an arbitrator.
3. Adjudication: Adjudication is the ultimate legal remedy for settlement of
Industrial Dispute. Adjudication means intervention of a legal authority
appointed by the government to make a settlement which is binding on both
the parties. In other words adjudication means a mandatory settlement of an
Industrial dispute by a labour court or a tribunal. For the purpose of
adjudication, the Industrial Disputes Act provides a 3-tier machinery:
a) Labour court
b) Industrial Tribunal
c) National Tribunal
a) Labour Court: The appropriate government may, by notification in the
official gazette constitute one or more labour courts for adjudication of
Industrial disputes relating to any matters specified in the second
schedule of Industrial Disputes Act. They are:
Dismissal or discharge or grant of relief to workmen wrongfully
dismissed.
Illegality or otherwise of a strike or lockout.
Withdrawal of any customary concession or privileges.
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Workers Participation in
Management
Workers participation in management is an essential ingredient of Industrial
democracy. The concept of workers participation in management is based on
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Human Relations approach to Management which brought about a new set of values
to labour and management.
Traditionally the concept of Workers Participation in Management (WPM)
refers to participation of non-managerial employees in the decision-making process
of the organization. Workers participation is also known as labour participation or
employee participation in management. In Germany it is known as codetermination while in Yugoslavia it is known as self-management. The International
Labour Organization has been encouraging member nations to promote the scheme
of Workers Participation in Management.
Workers participation in management implies mental and emotional involvement of
workers in the management of Enterprise. It is considered as a mechanism where
workers have a say in the decision-making.
Definition: According to Keith Davis, Participation refers to the mental and
emotional involvement of a person in a group situation which encourages him to
contribute to group goals and share the responsibility of achievement.
According to Walpole, Participation in Management gives the worker a sense of
importance, pride and accomplishment; it gives him the freedom of opportunity for
self-expression; a feeling of belongingness with the place of work and a sense of
workmanship and creativity. The concept of workers participation in management
encompasses the following:
It provides scope for employees in decision-making of the organization.
The participation may be at the shop level, departmental level or at the top
level.
The participation includes the willingness to share the responsibility of the
organization by the workers.
Features of WPM:
1. Participation means mental and emotional involvement rather than mere
physical presence.
2. Workers participate in management not as individuals but collectively as a
group through their representatives.
3. Workers participation in management may be formal or informal. In both the
cases it is a system of communication and consultation whereby employees
express their opinions and contribute to managerial decisions.
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Objectives of WPM:
1. To establish Industrial Democracy.
2. To build the most dynamic Human Resources.
3. To satisfy the workers social and esteem needs.
4. To strengthen labour-management co-operation and thus maintain
Industrial peace and harmony.
5. To promote increased productivity for the advantage of the organization,
workers and the society at large.
6. Its psychological objective is to secure full recognition of the workers.
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Functions:
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Trade unions fear that these councils will weaken their strength as
workers come under the direct influence of these councils.
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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.
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Collective Bargaining
Good relations between the employer and employees are essential for the success
of industry. In order to maintain good relations, it is necessary that industrial
disputes are settled quickly and amicably. One of the efficient methods of resolving
industrial disputes and deciding the employment conditions is Collective
Bargaining. Industrial disputes essentially refer to differences or conflicts between
employers and employees.
Collective Bargaining is a process in which the management and
employee representatives meet and negotiate the terms and conditions of
employment for mutual benefit. Collective bargaining involves discussion and
negotiation between two groups as to the terms and conditions of employment. It is
termed Collective because both the employers negotiators and the employees act
as a group rather than individuals. It is known as Bargaining because the method of
reaching an agreement involves proposals and counter-proposals, offers and
counter offers. There should be no outsiders involved in the process of collective
bargaining.
According to Walton and McKersie the process of Collective Bargaining consists of
four types of activities:
1) Distributive Bargaining: It involves haggling over the distribution of
surplus. Various activities involved in this activity are wages, salaries, bonus
and other financial issues. In this activity, both the parties face a win/lose
situation.
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Negotiati
on
Negotiated
Agreement
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Ratification of
Agreement
Implementation of
Agreement
1. Preparation for Negotiation: Preparation for negotiation in Collective
Bargaining is as important as the negotiation process itself. Upto 83% of the
outcomes are influenced by pre-negotiation process. Such preparation is
required for both management as well as the union representatives. From the
managements point of view, pre-negotiation preparation is required as:
Management should decide when and how to open the
negotiations/dialogue.
Management must choose the representatives to negotiate at the
negotiation table.
Draft for likely decisions should be prepared in advance so that the
final agreement draft can be prepared as soon as the negotiation
process is over.
From the employees side also, preparation is required for the following
reasons:
The union should collect the information related to the financial
position of the company and their ability to pay the employees.
The union must also be aware of the various practices followed by
other companies in the same region or industry.
The union must assess the attitudes and expectations of the
employees over concerned issues so that the outcome of negotiations
does not face any resistance from them.
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Industrial Disputes Act. It is important that the agreement must be clear and
precise. Any ambiguity leads to future complications or other such problems.
6. Implementation of agreement: Signing the agreement is not the end of
collective bargaining, rather it is the beginning of the process when the
agreement is finalized, it becomes operational from the date indicated in the
agreement. The agreement must be implemented according to the letter and
spirit of the provisions made by the agreement agreed to by both parties. The
HR manager plays a crucial role in the day-to-day administration
implementation of the agreement.
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