IR & LL For Sem III For Students

1.
Industrial Relations : Concepts, Nature, Evolution and Growth
Prof. T.K. Goon
Industrial Relations : Evolution and Growth

Features associated with changes of relations between employer and workmen in a unit or industry: Segmentation : Blue-color and White-collar Roles Specialization : Horizontal Differentiation Hierarchical levels : Vertical Differentiation A New Relationship Interface : A Range of Interface, Maximization of production, Technological Transformation & Innovations
Prof. T.K. Goon

Changes in workplace relationships include: Increase in capital-labor ratio; Work specialization Fragmentation of work Repetitive work to increase efficiency; Fragmentation of work led to formation of groups and employees and employers; New perspective of an inter-group relationship; Growing sense of insecurity required a collective effort to counter any management initiative for retrenchment, dismissal, etc.
Prof. T.K. Goon

Changes in workplace relationships brought more players associated: Groups of workmen / employees in the unit / industry; Association of employers; States to regulate public interest, social welfare Hence Industrial Relations is Social Relations in Production And, two dominant aspects of IR: Cooperation (among all stake holders); and Conflict
Prof. T.K. Goon
2. Objectives & Features of IR
Approaches; Role of State, TUs, Employers Organizations and ILO
Prof. T.K. Goon
Industrial Relations : Objectives & Features

INDUSTRIAL RELATIONS : SOCIAL RELATIONS:
This term is generally associated with relations between Employer and Employees in a Unit or Industry
Mass Production post Industrial Revolution, coupled with a laissez faire approach led to Employers adopting a Mechanistic approach to work and labor as a commodity and a factor of production Trade Unions emerged out of a necessity to restore some balance in the relationship between powerful capital and weak labor
Prof. T.K. Goon

Conflicting interests and ideological orientation conveyed an adversarial and strife-torn relationship The State sought to gain cooperation of the two partners in industry supporting economic growth and development through an improvement in the quality of work life (QWL).
Prof. T.K. Goon

DEFINITION OF IR MUST TAKE THE FOLLOWING INTO ACCOUNT: IR is about relationship The origin is in the relationship of employment Employer Employee relationship pertains to all kinds of organizations There are actors other than employer and employee who influence the relationship The relationships are shaped by actors, structures, rules, law, technology etc. The impact of social, economic, political and technological features of the context on the shaping of these relationships.
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SCOPE of Industrial Relations

SCOPE OF IR:
Management Union Relationship

Employer Employee Relationship
Relationships amongst various Groups of Employees

Effects of extraneous factors (State, Socio-Political-Economic factors) on workplace relationships
Prof. T.K. Goon
Scope of IR
IR deals with management of relationships, mainly with and within groups or agencies like: 1. Employees: Relationship among / between employees and their superiors 2. Union Management or Labor Relations Collective Relations between TUs and Management 3.Government Management Union: Collective Relationship between various organizations of employers and employees who represent management, the workforce and the State 4.Community or Public Relations
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Scope of IR
COMMUNITY OR PUBLIC RELATIONS: Relations between an industry and the society. This explains importance of CSR which has become a part of their work culture SUBJECT MATTER OF SUCH RELATIONSHIP: Desirable working conditions Establishment and maintenance of good personal relations Developing a sense of belonging by ensuring closer contact between persons from various rungs of industrial hierarchy Developing situations characterized by mutual concern and sense of responsibility for improve performance Maximization of social welfare Maintenance of industrial peace and avoidance of industrial disputes.
Prof. T.K. Goon
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Aims of IR
1. To promote and develop congenial labor-management relations
2.
3.
To maintain industrial peace and avoid industrial conflicts and disputes

To improve performance and productivity by minimizing losses on account of industrial strife and conflict, manifested in the form of strikes, go slow etc. To safeguard interests of labor and management by securing highest possible level of mutual understanding and respect To enhance economic status of workers by improving wages and benefits To establish industrial democracy by strengthening employee partnership
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4. 5. 6.
Aims of Industrial Relations

7. To ensure organizational discipline 8. To boost morale of workers and create a sense of organizational pride 9. To enable workers to solve problems through mutual negotiations and consultations with management 10. To encourage and develop TUs in order to increase workers strength and institutionalize process of collective bargaining
11.To correct imbalances in socio-economic order arising out of industrial development associated with complex relationships and conflicting interests.
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Objectives of Industrial Relations

OBJECTIVES OF IR: Different at enterprise / unit, industry and National levels AT INDUSTRY OR ENTERPRISE LEVEL: Healthy relationship Mutual trust and understanding Dysfunctional conflict free environment Gain in productivity for mutual benefits Minimizing loss of man-hour due to accidents, strife or absenteeism Reduced attrition environment Participative working on principles of industrial democracy Enhancing quality of life and work-life balance
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Objectives of Industrial Relations AT THE STATE LEVEL: Promoting industrial harmony and peace Safeguard rights of both labor and management Enlist cooperation and collaboration from both parties Improve economic conditions of labor through various legislations prescribing minimum guaranteed wages, welfare benefits and social security. Control industrial establishments through regulations in terms of engaging and disengaging employees. Safeguarding public interest. Prof. T.K. Goon
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Features of Industrial Relations
Arises out of employment relationship Sets complex rules and regulations for the participants to ensure industrial peace and harmony
Hinges on a cooperative spirit between all partners thereby emphasizing the need for adjustments and accomodation in the interest of growth and development.
Comprise employees and their organizations, employers and their associations, and the government as participants.
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Maintenance of Sound Industrial Relations

MAINTENANCE OF SOUND IR NEEDS:
Strong, well organized and democratic unions for balance of power to facilitate promotion and maintenance of uniform personnel policies among various org. Strong employers organization Belief in cooperative collective bargaining Sound HR policies Sound preventive systems Management support to IR functions Well-trained IR staff / supervisors Systematic effort at building a collaborative culture
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Schematic Interplay of Industrial Relations
LEGISLATURE
E X E C U T I V E
Protective
Performance / Compensation
Employees and Groups representing Employees
Employees
WELFARE
JOBS
WELFARE and Groups

Representing Employees
Regulatory (Rights)
Regulatory (Terms and conditions of employment)
JUDICIARY A Schematic Interplay amongst the main variables in IR

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Approaches to Industrial Relations

SIX APPROACHES TO IR: 1. The unitary approach 2. The Systems Approach : Dunlop (Input Transformation Output)
3. The Conflict Approach: Pluralism & Post Capitalism

4. Webers Social Action Approach individual and society
5. The Gandhian Approach or Trusteeship approach

6. The Marxian or Radical approach
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1. UNITARY APPROACH: Unity in structure Unity in purpose Having a single source of authority Having a cohesive set of participants
HENCE : Only one source of authority : Management Single / Unified loyalty Prerogative of Management to make business decision and employee related decisions.
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UNITARY APPROACH LEADS TO: Predominantly managerially oriented CB and TUs are perceived as being anti-social and antimanagerial Prefer union-less environment KRA of HR Manager : To prevent unionization
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2. System Approach: Dunlops Framework of Industrial Relations System
Inputs
Processes
Outputs
Actors
Environmental Contexts
Bargaining Conciliation Arbitration Lawmaking etc
Rules
Ideology
Feedback
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Dunlops Framework of Industrial Relations System

The Actors Managers & their representatives Workers & their Organizations Specialized Government Agencies concerned with workers, enterprises and their relationships
The Context Technological characteristics of the workplace and work community Product and factors markets or budgetory constraints that impinge on the actors
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The ideology A body of common ideas Ideas that defines role and place of each actor Ideas each actors hold towards place and function of others in system Ideology of a stable system compatibility among all in the system The Network or Web Rules Concerns procedures for establishing rules, regulations, decisions, orders, collective bargaining agreements, customs, traditions of workplace and community
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Some limitations of Systems Frame Work:
Consumers and Community not included

Talks about Roles and not People
Behavioral aspects like human motivations and preferences not emphasized
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Modification of System Framework
Top tier : Strategic Decision Making
Middle Tier : Collective Bargaining and/or HR policy making Bottom Tier: Workplace, individual and organizational relationships
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Approaches to IR Six Perspective

3. CONFLICT APPROACH PLURALISM & POST CAPITALISM
Organization is composed of individuals

Individuals make up distinctive groups, each with its own interests, objectives and leaderships Hence give rise to tensions, competition (intra and inter) Pluralism a belief of existence of more than one ruling principle giving rise to conflict of interests Hence, conflict is inevitable but containable through various institutional arrangements
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Approaches to IR - Six Perspective

3. CONFLICT APPROACH PLURALISM & POST CAPITALISM
Post Capitalist-society - viewed as an open society in which political, economic and social power is increasingly dispersed
Hence regulation of industrial and political conflict are of necessarily dissociated
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4. MAX WEBRERS SOCIAL ACTION APPROACH
Social Action is behavior having subjective meaning for individual actors, with social action theory focusing on understanding particular actions in industrial relations situations rather than on just observing explicit industrial relations behavior control;
Maruti Manesar labor unrest?
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5. TRUSTEESHIP APPROACH
Propounded by Mahatma Gandhi

Implies stewardships without ownership
Company accepts its total responsibility towards consumers, workers, shareholders and community
Mutual responsibilities to one another Managements role is to balance all claims delivering justice
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6. RADICAL APPROACH Also known as Marxian Perspective Capital system notion is production system is privately owned and is motivated by profits;
Control over production is exercised by Managers who are agents of Owners

Conflict is inevitable which cannot be contained or controlled as long as capitalism prevails Role of Trade Unions in protesting exploitation is inevitable Favors transformation of TUs into revolutionary organizations
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2. Role of State, Trade Unions, Employers Organization and International Labor Organization (ILO)
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Role of Government
Varies depending upon stage and level of development and strategy of industrialization Types of government interventions in labor market depends upon the purpose; Major State Interventions in IR: Policies : Peace, Cooperation and Competition Legislation : Central and State Institutions : Facilitative, Executive and Judicial
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Role of Government
Transition from planned economy to market economy resulted in major shifts in state intervention in IR in the fields of:
Legislation Trade Unions Wage setting Collective Bargaining, WPM; and Employment Security and Welfare
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Role of Government
Relationship between state and multinational corporation is often caught between different historical paradigms liberal, neo-liberal and neo-imperial traditions. Maruti-Suzuki : Haryana and Gujarat Center State relations affecting: Relative distribution of power and authority regarding policy making, legislation and enforcement of labor laws; and Competition between states results in pluralism and diversity; Gujarat, Bihar, West Bengal
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Role of Employers Organizations (EO)

These are formal groups of employers Can be registered under the Trade Union Act, 1926 or The Indian Companies Act, 1956 or the Societies Act, 1860 Main Aims and Objectives: To defend, represent or advise affiliated member-employers that may be necessary for promoting, supporting, opposing legislative and other measures affecting or likely to affect directly or indirectly industry, trade and commerce in general or particular interest
To strengthen position of such member-employers in society at large with respect to labor matters as distinct from economic matters.
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Role of Employers Organizations (EO)

AIOE All India Organization of Indian Employers CIE Council of Indian Employers ASSOCHAM Associated Chamber of Commerce FICCI Indian Chamber of Commerce & Industry EFI Employers Federation of India AIMO All India Manufacturers Organization SCOPE Standing Conference of Public Enterprises
CIE Council of Indian Employers Represent large scale industry in India Ensures closer cooperation and coordination between AIOE, EFI and SCOPE
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Role of Trade Unions

Major Aims, Objectives & Role of Trade Unions
To promote and protect workers interest through collective action To ensure security of workers To obtain better economic returns To Improve working conditions To ensure health, safety and welfare of workers at the work place Power to influence management Power to influence government
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2. International Labor Organization (ILO)
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International Labor Organization (ILO)

Created in 1919 Fundamental Principles : Labor is not a commodity Freedom of Expression and of association are essential to sustain progress Poverty anywhere constitutes danger to prosperity everywhere War against want requires to be carried on with unrelenting vigor within each nation and by continuance and concerted international effort in which the representatives of workers and employers, enjoying equal status with those of governments, join with them in free discussion and democratic decision with a view to promotion of common welfare.
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General Conference 26th session at Philadelphia in 1944 Affirms: All human beings, irrespective of race, creed or sex, have right to pursue their material well-being and spiritual development in conditions of freedom and dignity, of economic security and equal opportunity; Member countries central aim would be to attain the above through national and international policy
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Assist Member countries to recognize: Full employment and raising standards of living Minimum wages, hours of work, wages and earning for living Effective recognition of collective bargaining Cooperation of management of labor in continuous improvement of productive efficiency Extension of social security measures Adequate protection of life and health of workers Provision of child welfare and maternity protection Equality of education and vocational opportunity
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ILC International Labor Conference: Supreme body of ILO Each member country send 4 delegates 2 from State and 1 each representing employers and workers
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International Labor Organization

INDIA AND THE ILO: India is one of the founding members of ILO ILO activities have impacted IR in India in two important ways: Ratification of the ILO conventions and/or recommendations formed the basis for many labor legislations Requirement of the ILO to have representation from nongovernment delegates helped to organize the employee and employer groups
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CORE CONVENTIONS OF THE ILO: ILO has made a total Eight Conventions as Core Conventions or Human Rights Conventions. INDIA HAS RATIFIED FOUR OF THE EIGHT CORE CONVENTIONS: Forced Labor Convention (No.29) Equal Remuneration Convention (No.100) Abolition of Forced Labor Convention (No.105) Discrimination (Employment Occupation) Convention (No.111)
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OTHER CORE CONVENTIONS OF THE ILO YET TO BE RATIFIED BY INDIA: Freedom of Association and Right to organize (No.87) Right to Collective Bargaining (No.98) Minimum Wage Convention (No.138) Worst Form of Child Labor Convention (No.182) IN RESPECT OF OTHER CONVENTIONS: By 2004, India has ratified 39 including 4 Core Conventions of the 184 Conventions
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International Labor Standards and their influence on Indian Labor Legislation: Conditions of work Hours of work in: Industry, Mines, Road Transport, Commerce and Offices and Other Establishments Weekly Rest Holidays with Pay Wages Protection of wages Minimum wages
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International Labor Standards and their influence on Indian Labor Legislation: LABOR ADMINISTRATION AND INSPECTION EMPLOYMENT OF CHILDREN AND YOUNG PERSONS: Minimum age of employment Medical Examination Night Work Preparation of employment Worst form of child labor
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International Labor Standards and their influence on Indian Labor Legislation: EMPLOYMENT OF WOMEN Maternity Protection Night work Employment in unhealthy processes Equal Pay HEALTH, SAFETY AND WELFARE Safety Industrial Hygiene and Health welfare
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International Labor Standards and their influence on Indian Labor Legislation: SOCIAL SECURITY Workmens Compensation Sickness Insurance Invalidity, Old Age and Survivors Insurance Unemployment Provision EMPLOYMENT AND UNEMPLOYMENT Employment Offices Forced Labor
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Problems of Ratification: Member countries can be grouped as: Countries with Higher Labor Standards Countries having Federal Set-up Countries where subject matter of Conventions are regulated by Collective Agreements; and Industrially Back-ward countries
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3. Industrial Relations in India Phases of IR in India & IR Machineries In India
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Industrial Relations in India

1. 2. 3. 4. 5. 6. PHASE OF IR IN INDIA : Pre- independence Phase The protective phase (1947 56) The consolidation phase (1956-65) The conflict ridden phase (1965 -1977) The directionless phase (1977 1980) The productivity - Efficiency- Quality-orientation phase (1981 1990) 7. The competitive phase (post 1990)
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FORCES SHAPING IR SYSTEM IN INDIA: The colonial history Governments role in IR preventive and regulatory India being a founder member of ILO Political movement for Freedom and labor participation Worker-centric State policies Protection of domestic industries important substitution Multiplicity of TUs and political affiliation of TUs Labor in concurrent list in COI
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BASIC CHARACTERISTICS OF IR SYSTEM IN INDIA: Overall control through regulatory provisions Regulated primarily through legislations Though the laws promulgated are extensive, they are confounded with serious ambiguities and gaps Unionization largely restricted to organized sector Most unions have political affiliations Multiplicity of unions and external leadership State intervention has continued to prevail since time of Independence, although in the last decade, it has shown a declining trend
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Basic Characteristics of IR System in India:
Marked difference in labor management relations in different states, organized and unorganized sectors, private and private enterprises and multinationals and domestic companies There is no National IR policy Collective Bargaining is more a matter of optional practice with no statutory backing The changes brought in by the New Economic Policy have resulted in changes in the IR structure The heterogeneity of the emerging workforce has made it difficult to establish standards or uniform IR practices in the Indian industry.
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BIPARTISM: A system of IR where social and labor issues are discussed between Employee Groups (Trade Unions) and Employer/ Employers Groups (Management) usually at the Enterprise level TRIPARTISM: A system of Consultations amongst three actors of IR: Employers, Employees and the State Can take place at either or both macro and micro level; A binding spirit of mutuality and reciprocity Tripartism is an important feature and cornerstone of the IR system and Policy in India To give shape to this element of policy, a number of bodies were created:
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Important tripartite bodies in India: Indian Labor Conference (ILC) Standing Labor Committee (SLC) Committee on Conventions The Industrial Committees
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Industrial Relations Machineries in India

Central Level: Ministry of Labor Central Labor Commissioner (CLC) and its offices in various Regions (RLC) and ALC Conciliation Officers State Level Ministry of Labor State Labor Commissioner and ALC Labor Enforcement Officers (LEOs) Conciliation Officers
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UNDER VARIOUS LABOR LEGISLATIONS: Conciliation Officer ALC and RLC Board of Conciliation Labor Courts Regional PF Commissioner Commissioner under Employees Compensation Act Chief Factories Inspector under the Factories Act Authorities as prescribed under PoW Act, Minimum Wages Act, Gratuity Act, Shops & Establishments Act, ESI Act, Contract Labor Act etc.
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JUDICIAL MACHINERIES: District Court High Court Supreme Court
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Actors in IR
Employees including labor Employees Representatives viz Union, Federation of unions Employers Association of Employers (CII, ASSOCHAM, FICCI, AIMO) or Federation of Employers (e.g. Banks) Government / State Central as well as State Judicial Courts District Courts, High Courts & Supreme Courts Industrial Courts like Labor Courts, Tribunals including National Tribunal Wage Boards
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4. Global Industrial Relations Major Industrialized Economies
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Global Industrial Relations

In most industrialized countries, initial primary goal of IR system was to maintain labor peace and more generally industrial stability In many countries, IR system began to be institutionalized only in post-war period, coinciding with independence of some of the countries Factors affecting across industrialized work: Decentralization of bargaining Movement towards increased flexibility in wages, labor deployment and workplace practices
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Global Industrial Relations

FACTORS INFLUENCING IR FRAME WORK IN MAJOR ECONOMIES: Globalization Impact of Information Technology Changing demographic profile of workers Restructuring of industrial enterprises Emergence of knowledge economies and knowledge workers Outsourcing of non-core activities Uncertainty in trade union movement LEADING TO: Decentralization of Bargaining Increased flexibility in wages, labor deployment and workplace practices.
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IR in UK
Early 20th Century: Largely shaped around challenge of staple industry Resulted in industry level collective bargaining to take care of the twin problem Post war period: Bargaining took place more and more at industry level Hardly any scope of CB at enterprise level Post 1979 and Thatcherism: Industrial Chaos & Strong-arm tactics of Tus Passing of Employment Relations Act (1979) Marget Thatchers Economic and Political Philosophy of reduced state intervention, Free Market and Entrepreneurism
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IR in UK
Post 1979 and Thatcherism: Passing of Employment Relations Act (1979) Margaret Thatchers Economic and Political Philosophy of reduced state intervention, Free Market and Entrepreneurism Resulted in: Industrial Chaos & Strong-arm tactics of Tus Characteristics of Tus in Britain: Tradition of Voluntarism Representation of workers through TU Officers at workplaces in the form of shop steward; TU membership on occupational rather than industrial lines.
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IR in EU
EC attempting a pooling of research on IR structures, processes, laws and practices in Member Countries with a view to bring in gradual uniformity on larger policy matters pertaining to IR Characteristics of TUs in EU: Distinct movement towards TU organization at pan-EU level; Some diversity in National level, efforts are on at some sort of integration. ETUC set up in that direction Unions in most member countries are organized on a sectoral or occupational basis; Blue-collar union losing influence and white collar unions gaining significance.
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IR in USA
National and Business Culture : Ethnocentric IR in USA parallels in development of TUs, organized labor and labor legislations, as it does elsewhere; Major Legislations:
The Norris LaGuardia Act, 1932 The Wagner Act, 1935 The Taft Hartley Act, 1947 The Landrum Griffin Act, 1959
Trade Unions in USA: AFL-CIO : American Federation of Labor And Congress of Industrial Organizations (1955); largest federations of unions in USA
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IR in Australia
Both Federal and State Governments can legislate on labor matters; Oldest legislation : Conciliation and Arbitration Act, 1904; This was replaced in 1988 with Industrial Relations Act, 1988
This act requires federal trade unions to register themselves with registrar to be able to take assistance of arbitration process and other legal rights flowing from the act.
Most significant is Workplace Relations Act 1996 objective to settlement of conflicts and disputes at workplace itself.
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IR in China
Historically main characteristics of the IR System includes:
State owner ship of industrial enterprises; Implicit guarantee of employment for workers; Centralized wage structure; A rigid labor market with little inter-enterprise or inter-regional mobility; Absence of price- or efficiency-driven controls over the industry
Post 1978, system is in a state of ferment, more particularly since 1983;

Government enacted a new labor law in 1994 essentially to create a new IR System within the socialist market economy but implementation has not been uniform.
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IR in Japan
IR System is an institutionalized one Historically it focused :
Enterprise Unions Lifetime- employment systems, Broad based training; and Seniority based wages
Key outcome of IR System is simultaneous achievement of stability in labor-market and considerable functional flexibility in workplace level IR Then came sudden and dramatic increase in outsourcing within Japan, termed as work commissioning; Result:
Increase in wage flexibility Resulting into reduced power of trade unions
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IR in South Korea
Greatly influenced by USA; Prior to 1990, conflict prevention and conflict avoidance were stated objective; Overall goal of maintaining stability in IR was a part of economic development and political control; Example: Governments efforts to control wage costs Legal changes mandated formation of Enterprise Unions which are bound to be a member of FKTU, a union federation created under mandate of government. IR system restructured due to competitive forces; Asian currency crisis hastened process of fundamental changes with Tripartite involvement in policy; However, IR system is still in transition phase.
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IR in Singapore
IR System is well known for its distinctive Tripartite feature which is considered both functional and flexible; State provides fund and training on development issues so as to lay foundation for responsible unionism To ensure that dispute does not result in strikes, legislation provided for (a) secret ballots on strikes; (b) a notice period; and withdrawal of strike once the dispute was under mediation or conciliation proceedings; At the workplace level, a few contentious issues that impacted operational flexibility and efficiency are out of bargaining, examples:
Transfers; Promotions; Termination, Hiring etc.
Employers provided with flexibility and substantial control over operational decisions
Result : scope of disputes reduced.
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EMERGING INTERNATIONAL TRENDS IN IR:
Decline in union membership and union density
Consolidation and merger of trade unions

Variations in collective bargaining practices
A shift in the relationship from employers organizations and trade unions to employer and an individual employee
Organization restructuring and emergence of atypical forms of employment.
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5. Changing Characteristics of Industry and Workforce in India
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Changing Characteristics of Industry and Workforce in India
MAJOR FORCES DRIVING INDUSTRIAL CHANGE: Computerization Automation Rationalization Globalization
EFFECT OF INDUSTRIAL CHANGE ON LABOR MARKET: Changed occupational structure Changed nature of work Integrated job markets leading to a global occupational structure Improved education facilitating economic growth.
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RESULT OF CHANGES IN TECHNOLOGY: Mechanization Automation Information-based services Disintermediation
ABOVE IN TURN IS FORCING: Rationalization of manpower Labor substitution in case of automation
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Participation rate: Proportion of people in labor force out of total cohort population: In 1999-2000: 7.32% of labor force i.e. 26.58 million were unemployed
A large proportion of those employed are in subsistence employment Only 8% of those employed are in organized sector Education and skill profile of current workforce is still poor.
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Changing Characteristics of Industry and Workforce in India MAIN CHANGES IN LABOR DEMOGRAPHICS: Decline in participation rates across age groups
Entry of the younger age groups into labor force

More active participation of older people in labor force
A reduction in differentials between male and female participation

Relatively low education and skill levels An attitudinal change towards Technical and Vocational courses.
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MAJOR TRENDS IN UNORGANIZED SECTOR 93% of employees in unorganized sector Absence of an institutionalized IR system Labor legislations not for smaller establishments Social security --->out of reach Absence of unions does not provide any opportunity for collective bargaining
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TRENDS IN INDUSTRY: Profit and market leadership are prime drivers, not social objectives Changes on market ad technology are throwing up newer competency requirements Large employment opportunities in private sector Public sector employment faces stagnation and decline Government employment is practically NIL More opportunities in tertiary sectors
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Growing internationalization of business and workforce has its impact on HRM in terms of: Problems of unfamiliar laws; Languages, Practices, Attitudes, Management styles, Work ethics and more HR & IR professionals Challenge : To deal with more and more heterogeneous sets of workers; and More involvement in employees personal life
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Liberalization has led to Large scale reorganization of business in terms of: Expansions Mergers and Acquisitions (M&A); Joint ventures (JVc); Takeovers Internal restructuring of organizations Situation is dynamics as well as uncertain and the challenges for HR & IR professionals : To manage employees anxiety, uncertainties, insecurities and fears.
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There are signs of changing demographics of the workforce reflected in: Age and Qualification mix; Dual career couples; Large chunk of young blood with contrasting ethos of work;\ Growing number of women in workforce; Working mothers; More educated and aware workers; Growing number of able superannuated workforce
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6. Trade Unionism and Trade Unions
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Trade Unionism and Trade Unions

Trade Unionism, developed as an effort of the laborers to organize during the Industrial Revolution era, promoted the Factory System of Production and a laissez-faire approach of the State towards participants of Factory System BASIC THEORIES EXPLAINING TRADE UNIONISM: Revolutionary Ownership based Industrial Democracy, Rights based Business Economic Power Socio-psychological belongingness
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1. REASONS FOR JOINING A TRADE UNION: To attain economic security
2.
3.
To be able to improve bargaining power

For ventilation of workers grievances
4.
5.
For an information medium

To protect unexpected economic needs
6.
7.
To satisfy social needs

For securing power
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TOOLS OF TRADE UNIONISM: Mutual insurance Collective Bargaining Legal enactment Direct action
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LINK BETWEEN POLITICS AND TRADE UNIONS: Politically committed members account for 15-20% of total membership in a union, but their influence is high Political parties and unions function in close cooperation, but there is an essential difference between the two TUs in India are fragmented due to their allegiance to different political parties
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RIGHTS OF TUS: ILO recognized the rights of association through Freedom of Association and Protection of the Rights to Organize Convention (Convention No.87) Many countries have not ratified this convention
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1. 2. 3. 4. 5. MAJOR OBJECTIVES OF TUS: Ensure security of workers Obtain better economic returns Improve working conditions Power to influence management Power to influence government
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Role of Trade Unions

Major Aims, Objectives & Role of Trade Unions
1.
2. 3. 4. 5. 6. 7.
To promote and protect workers interest through collective action To ensure security of workers To obtain better economic returns To Improve working conditions To ensure health, safety and welfare of workers at the work place Power to influence management Power to influence government
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BROAD AREAS OF TU FUNCTIONS: Organizational Economic Political-legal Welfare
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1. 2. 3. 4. 5. 6. 7. 8. SPECIFIC TU FUNCTIONS: Protect Economic interests of the members Influence social relationships at the workplace Influence policies at National level Collective action for sectional interest Collaboration for productivity and gain sharing Enhancing professional status Research Communication, welfare and education
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FEATURES OF AN EFFECTIVE TU: Internally Democratic Have a strong leadership and large follower ship Exhibit a responsibility towards their workers members Committed to promote industrial peace and harmony Inclined towards collective bargaining that is collaborative and not competitive Possess financial security Adaptable to change Trade unions may be classified on the basis of purpose and the purpose of membership
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Features of an Effective TU: TRADE UNIONS MAY BE CLASSIFIED ON THE BASIS OF PURPOSE AND THE PURPOSE OF MEMBERSHIP: ON THE BASIS OF PURPOSE: Regulatory Reformist Revolutionary ON THE BASIS OF MEMBERSHIP: Craft Industry Staff
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6. Trade Unions in India
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Trade Unions in India

Indian TUs are very fragmented Early splits in Indian TUs tended to be on ideological grounds Recent fragmentations have centered on personalities and occasionally on regional and caste considerations Trade union activities are restricted to industrial areas AITUC was formed in 1920 on a national basis
PHASES IN THE GROWTH OF TUS: First post-independence growth phase Second post-independence growth phase (1960s -1980s) Pre-liberalization era (1980-1991) Post liberalization era (beyond 1991)
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UNION SECURITY: Through membership that is sought by providing benefits of collective bargaining only to those who remain their members Union derives its meaning and strength from number of members it has; Unions (and management) look for measures that enhance security i.e. maintaining a healthy membership in comparison to others Free riders are discouraged
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UNION SECURITY: CAN BE ACHIEVED THROUGH PRACTICES SUCH AS:
Recognition (by management) as the sole bargaining agent

Maintenance of membership (preferential shop, agency shop, closed shop, open shop, union shop) Check-off system
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Central Trade Union Organizations: Presently there are 9 CTUOs with differet political affiliations: AITUC INTUC CITU HMS BMS
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MAJOR PROBLEMS FACED BY TUS IN INDIA: Outside or Political Leadership Multiplicity of unions and inter-union rivalry Small size of the unions Low membership Uneven growth Poor financial position Low level of knowledge of labor legislation Fear of victimization
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TRADE UNIONISM IN INDIA: Unionization according to Industry / Region / State 70,000 registered TUs, large number not registered 2% of workers unionized PSUs: Industry-level collective bargaining in coal / steel/oil and gas Enterprise wise elsewhere Private sector : Plant level Collective Bargaining Union density according to the size of the industry Craft unions in the government transport sector Low unionization in SMEs Twin battle against inter-union competition and assertive management Unionization in India under recession
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TRADE UNIONS IN INDIA

REGISTRATION AND RECOGNITION 10% of workers members or 100, subject to a minimum of seven, can apply for Registration of a union One-third of the office bearers can be outsiders; Trade Union can raise and maintain political funds as a separate account; Office bearers of a Registered TU are exempt from civil and criminal liability; But accountable under the Consumers Protection Act.
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REGISTRATION AND RECOGNITION Registration is with the Registrar of TUs to enjoy certain privileges Recognition is by the management for collective bargaining TU Act does not have provision of Recognition of TU Certain State have enacted Law for Recognition viz Maharastra, Gujarat, Rajasthan and UP Certain State have formulated recognition rules viz AP, Orissa and WB. In India all registered TUs have de facto, not de jure recognition. De facto means virtually and De jure means by law.
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PRIVILEGES OF RECOGNIZED UNIONS Right to represent their members grievances Right to collective bargaining / agreements on wages, working conditions etc. May ask for special benefits like office space and infrastructure, notice board, time off for union work as well as financial and other support for education, training and other non-bargaining activities
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CLOSED SHOP / OPEN SHOP Closed shop means union membership is pre-requisite for employment. UK had it, now illegal under EU Law. Open Shop means joining union membership is after employment within a specified period. CHECK OFF Means a system by which workers give in writing to deduct union membership fees from their wages Neither TU Act nor Payment of Wages Act explicitly provides for it. Not legal for employer to deduct union subscription without members authorization and unions request.
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CODE OF DISCIPLINE 15th Session of Indian Labour Conference (1957) laid down a set of principles for maintaining harmonious inter-union relationship: Every employee in an industry or unit shall have freedom and right to join the union of his/her choice. No coercion shall be exercised in this matter. There shall be no dual membership of unions There shall be unreserved acceptance of and respect for the democratic functioning of TUs There shall be regular and democratic elections of executive bodies and office bearers of TUs Ignorance and backwardness of workers shall not be exploited by an organization.
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CODE OF DISCIPLINE No organization shall make excessive or extravagant deamnds Casteeism, communalism and provincialism shall be eschewed by all unions. There shall be no violence, coercion, intimidation or personal vilification in inter-union dealings.
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CODE OF DISCIPLINE & CRITERIA FOR RECOGNITION OF TU Where there is more than one union, a union claiming recognition should be of one year old. For one union, this condition not apply; Membership of union should have at least 15% of the workers A representative union should have at least 25% of workers of that industry in that area. Recognition should remain valid for 2 yrs Union with largest membership should be recognized If a TU is not affiliated to any of the four central organizations of labor, issue of recognition would be dealt separately. In an industry in an area, if a union of that industry enjoys 50% or more membership, that union will have right to deal with issues of local interests Only unions which observed Code of Discipline would be Prof. T.K. Goon 111 recognized.
TRADE UNIONS IN INDIA - CHALLENGES

INTERNAL CHALLENGES Low Membership Density Formal and Informal Sector Declining Union Membership Reprentativity AITUC, CITU, INTUC, BMS, HMS etc. Poor Finances Major sources and Uses of Funds Financial Strength of Trade Unions
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TRADE UNIONS IN INDIA - CHALLENGES

EXTERNAL CHALLENGES Global Competition Rapid Changes in Technology Shifting Attitudes of Government Managerial Strategies and HRM Policies Assertion of their Rights by the Community and Consumers ORGANIZATIONAL ISSUES Leadership Changing Demographics Internal Democracy Declining Union Power and Influence
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TRADE UNIONS ACT, 1926: Enacted mainly in deference to ILO Convention, in recognition of the right of workers to organize and also to strengthen bargaining power of workers Act aims to provide for registration of TUs and in certain aspects, to define the law relating to registered TUs OBJECTIVES OF THE ACT: Lay down conditions governing registration of TUs 10% or 100 subject to minimum of seven members can apply for registration. Define obligations of a registered TU Prescribe rights and liabilities of a registered TU
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SOME OBLIGATIONS & DUTIES OF REGISTERED TRADE UNIONS:
Not more than 1/3 rd outsiders can be office bearers; There has to be a separate fund for political purpose; Must encourage collective bargaining Must protect interest of its members
PROTECTION TO OFFICE BEARERS OF REGISTERED TRADE UNION:
Office bearers are exempt from civil and criminal liability; but accountable under Consumer Protection Act
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MANAGERIAL TRADE UNIONISM: TUs in Executive cadre like Civil services, doctors, electricity board, bank officers, merchant navy officers etc. These associations among white-collared workers more pronounced in public sector.
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RIGHTS OF RECOGNIZED TRADE UNIONS: Right to raise issue with the management
Right to collect membership fees within the premises of the organization

Ability to demand check-off facility Ability to put up Notice Board on premises for union announcements
Ability to hold discussions with members at a suitable place within the premises
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Rights of Recognized Trade Unions: Right to discuss members grievances with employer Ability to inspect beforehand a place of employment or work of its members
Nomination of its representatives on Committees formed by Management for industrial relations purpose as well as statutory bipartite committees
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7. Conflict Management Causes, Approach & Leadership Style
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Conflict Management
Specific causes of conflict: Economic: Division of the fruits of industry
Wage structure and demands for higher wages Methods of job evaluation Deductions from wages Incentives Fringe benefits
Methods of production and physical working conditions

Technology and machinery Working conditions Layouts Changes in products Terms of employment
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Conflict Management
Specific causes of conflict: Economic: Terms of employment
Hours of work Shift working Promotion Demotion Layoffs Retrenchment Dismissal Job-security Retirement etc.
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Conflict Management
Specific causes of conflict: Institutional: Recognition of TUs Membership of TUs Subjects of CB Bargaining Unit Union Security Unfair practices
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Conflict Management
Specific causes of conflict: Psychological: Clash of personalities Behavioral maladjustment Demands for recognition of workers personality Authoritarian administration Lack of scope for self expression and participation Undue emphasis on disciplines
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Conflict Management
Specific causes of conflict:
Denial of Legal and Contractual Rights:

Non-implementation of labor laws and regulations, standing orders, adjudication awards and so on; Violation of collective agreements, wage boards recommendations, customer rights and privileges and so on
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Modes of resolving conflict AVOIDANCE MODES
APPROACH MODE
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Modes of resolving conflict
AVOIDANCE MODES Aims at avoiding or postponing conflicts in a variety of ways 1. Resignation 2. Withdrawal 3. Defusion 4. Appeasement
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Modes of resolving conflict
APPROACH MODE Take more aggressive or understanding forms by using positive steps to confront conflicts and find solutions by way of: 1. Confrontation 2. Compromise 3. Arbitration 4. Negotiation
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Avoidance Mode 1. RESIGNATION Extreme avoidance of a conflict with a sense of helplessness Conflict is seen as a part of reality, arising out of unreasonable stand of out-group, usually seen as hostile. Another form of Resignation is to ignore the conflict Also denying unpleasant situation in the hope that conflict will get resolved itself in due course. Many organizations resigns to recurring conflicts with Trade Unions and do not attempt to resolve them, hoping solutions may emerge in due course of time and other will understand some day.
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Avoidance Mode 2. WITHDRAWAL Getting away from a conflict Out-group is seen as belligerent but still open to reason One way to get away from the conflict is to avoid situation of potential conflict, by leaving the two groups to work together. Another way to withdraw from collaborative work with outgroup Another way is to withdraw from a conflict when it takes place. Physical separation is a third way to withdraw Fourth way of withdrawal is to define boundaries of interaction with out-group and make arrangement to limit these. Psychological withdrawal when one of the spouses stop arguing and keep quiet whenever there is a difference of opinion do not sort out the difference but even leave the house for sometime (physical withdrawal) herself
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Avoidance Mode 3. DEFUSION Buying time for dealing with a conflict May take several forms Let the participants cool down before taking up the real issue Allow passage of time to settle down the emotions Best example separate statehood of Telengana PM allowed time to defuse the situation Another way to appeal to good sense of both groups, to the sentiment that both are part of a larger group and have common interests, interdependence, mutuality etc Another way to develop temporary arrangement of interaction through a third group creating buffer to absorb excess emotions.
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Avoidance Mode 4. APPEASEMENT Providing some concessions in the hope that the out group will be satisfied and the conflict will be over Main objective is to buy temporary peace. When conflict is embarrassing and disturbing, may agree to some demands of out-group to postpone the conflict. Appeasement has same dynamics as payment in case of blackmail Out-group get the message that the group is weak and incapable of confronting issues. Conflict remain unresolved, demands of out-group increases, its posturing gets stiffer and situation deteriorates further.
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Approach Mode 5. CONFRONTATION Fighting out an issue to get a solution in ones favor When in-group perceives the out-group to be both opposed to its interests and unreasonable, confrontation is adopted, It may lead to Win-lose Trap It involves coercion and is likely to fail to reach a solution Long strikes by Trade Unions is a good example of confrontation. Each party try to show their own strength by various ways.
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Approach Mode 6. COMPROMISE A process of sharing the gain without resolving the conflict. Can be done by Bargaining Often used in conflicts between managements and unions If the out group is seen as being interested in peace (and hence as reasonable), attempt is made to seek a compromise Example: If management is interested in fulfilling certain export orders, they may agree to increase incentive for a particular period and union may agree to work for longer hours for that time
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Approach Mode 7. ARBITRATION A third party giving an award acceptable to both groups If out group is perceived as being belligerent and not interested in peace, and yet not totally unreasonable, arbitration is resorted to; Usually the conflict remains unresolved it is only postponed for a time In many management union conflicts, arbitration by labor commissioner is sought.
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Approach Mode 8. NEGOTIATION Continuous interaction and dialogue between groups in order to find a solution with maximum advantages to both Most satisfactory solution can emerge in confronting the problem and exploring alternative solutions Possible when out group is perceived both as interested in peace and as reasonable. Number of steps are involved in the process: Unfreezing, Being Open, Learning Empathy, Searching for common themes, Generating Alternatives, Searching for a solution, Breaking the deadlock, Committing to the solution within the group, and Committing the Whole Group
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Conflict Management Style

Mode Avoidance Perception of Out-group Unreasonable Opposed to our interest and belligerent Opposed to our interest and belligerent Having own interest but interested in peace Having own interest but interested in peace Style Resignation
Avoidance
Open to reason
Withdrawal
Avoidance
Unreasonable
Appeasement
Avoidance
Open to reason
Defusion
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Conflict Management Style

Mode Approach Perception of Out-group Unreasonable Opposed to our interest, and belligerent Opposed to our interests, and belligerent Having own interests, but interested in peace Having own interests, but interested in peace Style Confrontation
Approach
Open to reason
Arbitration
Approach
Unreasonable
Compromise
Approach
Open to reason
Negotiation
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137

IR & LL For Sem III For Students

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1.

Industrial Relations : Concepts, Nature, Evolution and Growth

Prof. T.K. Goon

Industrial Relations : Evolution and Growth

Prof. T.K. Goon

Industrial Relations : Evolution and Growth

Prof. T.K. Goon

Industrial Relations : Evolution and Growth

Prof. T.K. Goon

2. Objectives & Features of IR

Approaches; Role of State, TUs, Employers Organizations and ILO

Prof. T.K. Goon

Industrial Relations : Objectives & Features

Prof. T.K. Goon

Industrial Relations : Objectives & Features

Prof. T.K. Goon

Industrial Relations : Objectives & Features

SCOPE of Industrial Relations

Management Union Relationship

Relationships amongst various Groups of Employees

Prof. T.K. Goon

To maintain industrial peace and avoid industrial conflicts and disputes

Aims of Industrial Relations

Objectives of Industrial Relations

Prof. T.K. Goon

Features of Industrial Relations

Prof. T.K. Goon

Maintenance of Sound Industrial Relations

Prof. T.K. Goon

Schematic Interplay of Industrial Relations

Employees and Groups representing Employees

WELFARE and Groups

Regulatory (Terms and conditions of employment)

JUDICIARY A Schematic Interplay amongst the main variables in IR

Approaches to Industrial Relations

3. The Conflict Approach: Pluralism & Post Capitalism

5. The Gandhian Approach or Trusteeship approach

Approaches to Industrial Relations

Prof. T.K. Goon

Approaches to Industrial Relations

Prof. T.K. Goon

2. System Approach: Dunlops Framework of Industrial Relations System

Bargaining Conciliation Arbitration Lawmaking etc

Dunlops Framework of Industrial Relations System

Prof. T.K. Goon

Dunlops Framework of Industrial Relations System

Prof. T.K. Goon

Dunlops Framework of Industrial Relations System

Consumers and Community not included

Behavioral aspects like human motivations and preferences not emphasized

Prof. T.K. Goon

Modification of System Framework

Top tier : Strategic Decision Making

Approaches to IR Six Perspective

Organization is composed of individuals

Prof. T.K. Goon

Approaches to IR - Six Perspective

Prof. T.K. Goon

Approaches to IR - Six Perspective

Prof. T.K. Goon

Approaches to IR - Six Perspective

Propounded by Mahatma Gandhi

Prof. T.K. Goon