Human Resource

Management
Industrial Relations
Flow of the presentation
Industrial Relations- definition, main
aspects, approaches.
Trade union- main aspects=objectives-
definition,
Collective bargaining- meaning, definition,
process, functions, importance.
Legislations concerning settlement of
dispute.
Methods of settlement of disputes.
Industrial Relations
As people in their normal life have understanding
about each other called Relation, so do have
employees and management in an organization.
The understanding between employees and
management in an industrial organization is
commonly called Industrial Relations (IR).
That good industrial relations help retain
employees, on the one hand, and run the
organization successfully, on the other.
Basically, IR sprouts out of employment relation.
Hence, it is broader in meaning and wider in
scope.
Definition
According to Dale Yoder, The Industrial
Relations has been described as
relationship between Management &
employees or among employees & their
organizations that characterize & grow out
of employment.
Objectives of IR
The primary objective of Industrial Relations is to
maintain and develop good and healthy relations
between employees and employers or operatives
and management.
Establish and foster sound relationship between
workers and management by safeguarding their
interests.
Avoid industrial conflicts and strikes by developing
mutuality among the interests of concerned parties.
Keep, as far as possible, strikes, Lockouts, Gheraos,
at bay by enhancing the economic state of workers.
 Provide an opportunity to the workers to
participate in management and decision
making process.
Raise productivity in the organization to curb
the employee turnover and absenteeism.
Avoid unnecessary interference of the
government, as far as possible and
practicable, in the matters of relationship
between workers and management.
 Importance of I.R
1.Foster Industrial Peace.

2.Promote Industrial Democracy.

3.BFoster Industrial Peace.

4.Promote Industrial Democracy.

5.Benefits to workers.
Approaches to IR
The scenario of IR and factors affecting it are perceived

differently by different behavioral practitioners and theorists.

An understanding of these approaches to IR helps the HR

manager in devising an effective HR strategy. The popular

approaches to IR are:

1. Unitary Approach

2. Pluralistic Approach

3. Marxist Approach
1. Unitary Approach
This approach is based on the assumption that every one be it

employer, employee or government benefits when emphasis is on

common interest. Alternatively speaking, under Unitary approach, IR

is founded on mutual co-operation, team-work, shared goal and so on.

Conflict at workplace, if any, is seen as temporary aberration resulting

from poor management or mismanagement of employees. Otherwise,

employees usually accept and cooperate with management.

Conflict in the form of strikes is disregarded as destructive.

This approach is criticized mainly on two grounds:

1. It is used as a tool for keeping employees away from unionism.
2. It is also seen as exploitative and manipulative.
 2. Pluralistic Approach
The approach perceives that organization is a coalition of
competing interest groups mediated by the management.
At times, it may so happens that management in its mediating

role, may pay insufficient attention to the needs and claims of

employees. In such a situation, employees may unite in the form of
trade unions to protect their needs and claims.
As a result, trade unions become the legitimate representatives of

employees in the organization. Thus, the system of IR gets

grounded on the product of concessions and compromises between
management and trade unions.
The limitation of this approach is that this approach is assuming

that employees and management do not arrive at an acceptable

 Marxist Approach
Like pluralists, Marxists also view conflict between labour and management as inevitable.

But Marxists unlike pluralists, regard conflict as a product of the capitalist society based

on classes.

According to Marxists, conflict arises because of division within society in terms of haves

i.e. capitalists, and have nots i.e. labour. The main objective of capitalists has been to

improve productivity by paying minimum wages to labour. Labour views this as their

exploitation by the capitalists.

The Marxists do not welcome state intervention, in their view, it usually supports

managements interest.

The labour capital conflict, according to Marxist approach can not be solved by

bargaining, participation, and co-operation.

In such a situation, trade union comes into a picture and is seen as a reaction to

exploitation by capitalists and also a weapon to bring a revolutionary social change by

changing capitalist system.

 Dominant Aspects of
Industrial Relations
There are two important aspects of the IR:

1. Co-operation

2. Conflict
 Industrial Disputes

Conflict, as one of the features of industrial

relations, is a general concept, when it acquires a
concrete and specific aspect it will take the form of
Industrial Dispute.
Industrial Disputes may be said to be disagreement
between management and labour with respect to
wages, working conditions, other employment
matters.
When issues of conflict are submitted to the
management for negotiation, they take the form of
Industrial Disputes.
Specific causes of Industrial Disputes
A brief list of the specific causes of Industrial
Disputes are as follows:
Economic
1. Division of the fruits of the Industry
2. Methods of production and physical working
conditions
3. Terms of Employment
. Institutional
. Psychological
Meaning of Trade Union
A trade union is an organization of workers that is formed
with a view of protecting and promoting the interests of
workers.

A trade union is an association of employees designed primarily to

maintain or improve the conditions of employment of its
members.
Lester

A trade union is a continuous association of wage-earners for the

purpose of maintaining or improving the conditions of their
working force
Beatric Webb
Objective of Trade Unions
Wages salaries
Working conditions
Discipline
Personnel policies
Welfare
Employee-employer relation
Negotiating machinery
Safeguarding organizational health and interest of the
industry
Principles of Trade Unionism
Trade unions function on the basis of three
fundamental principles.

Unity is strength.
Equal pay for equal work or for the same job.
Security of service.
Why do Workers Join Trade Unions?
To attain economic security- permanent employment with
higher salary and benefits.
To improve their bargaining power or resist the
managements irrational, illogical and discriminatory
actions.
To inform workers views, ideas aims and dissatisfaction
to the management.
To satisfy social needs.
To satisfy their needs for a sense of belonging.
To secure power.
Minimizes Discrimination
Sense of Participation
Betterment of Relationships.
Functions of Trade Union
The basic functions of trade unions is to protect and
promote the interest of the workers and conditions of
their employment.

1. Militant Functions
2. Fraternal Function
3. Social Functions
4. Political Functions
5. Ancillary Functions
Militant/Protective Functions
Ensuring adequate wages, better working conditions
and better treatment from employers
Fight with the management in the form of strikes,
boycotts, gheraos etc.

(i) Achieve higher wages and better working

conditions.

(ii) Raise the status of workers as a part of industry and

(iii) Protect labour against victimization and injustice.

Fraternal Functions
Providing financial and non-financial assistance to workers

Extension of medical facilities during sickness and

casualties.

Provision of education, recreation, and housing facilities

Provision of religious and social benefits.

To encourage sincerity and discipline among workers.

To provide opportunities for promotion and growth.

Social Functions
Carrying out social service activities
Discharging social responsibilities through various sections of the society like
educating the customers.

Political Functions
Affiliating a union to a political party
Helping the political party in enrolling members
Collecting donations
Seeking the help of political parties during the strikes and
lockouts.
Ancillary Functions
1. Communication: trade union communicates its activities,
programmes, decisions achievements etc, through publication
of news letter.

2. Welfare Activities: acquiring of house sites, construction of

houses, establishment of co-operative housing societies,
organising training activities etc.

3. Education: educational facilities to its members and their

family members.

4. Research: arrange to conduct research programme. Collect

and analyse data and information for collective bargaining,
preparing notes for union officials.
Trade Union Act, 1926
Provide for registration of T.U.
Confers certain protection and privileges.

1. Formation and Registration:- 7 members can form a

trade union and may apply to the registrar of Trade
Unions for registration.

2. Application accompanied by Schedule:- I, II and bye

law and a resolution authorizing 7 members of the union
to make an application for registration of the union
Registration Fees Rs. 500/
After making necessary enquiry the registrar

3. Issues a registration certificate:-

It may be cancelled or withdrawn on the application of a trade union
in Form-D or

If the registrar is satisfied that the certificate is obtained by fraud or

the trade union has ceased to exist or wilfully and after notice from
the registrar contravened any provisions of the Act.

4. Appeal person aggrieved:- by any order of the registrar may

appeal within 2 months to the Civil Court not inferior to the court of
Additional or Assistant Principal Civil Court
5. Change of Name :- any registered trade union may with
the consent of not less than 2/3 of its total members may
make application in Form H, for the change of its name.

6. Annual Returns:- Every union shall send annual returns

to the registrar in triplicate on or before the Ist day of
June of the year succeeding the calendar year in Form-L
in case of individual trade unions and in Form-LL in case
of federation of trade unions.
Conclusion
Emergence of trade union to an extent helped to
improve the standard of living of WORKERS but it is
fact That trade unions now a days downsized as a
toy/instrument of various political parties which force
them to regret its moral values.
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.

One of the efficient methods of resolving industrial

disputes and deciding the employment conditions

isCollective Bargaining.
Industrial disputes essentially refer to differences

or conflicts between employers and employees.

Definition
According to Jucious, collective bargaining
refers to a process by which employers on
the one hand and representative of
employees on the other, attempt to arrive
at agreements covering the conditions
under which employees will contribute and
be compensated for their services.
What is Collective Bargaining
Both management and labor are required by
law to negotiate wage, hours, and terms and
conditions of employment in good faith.

What Is good faith bargaining?

Both parties communicate and negotiate.
They match proposals with counterproposals
in a reasonable effort to arrive at an
agreement.
It does not mean that one party compels
another to agree to a proposal or make any
specific concessions.
Objectives of Collective Bargaining:

1. To maintain cordial relations between the

employer and employees.
2. To protect the interests of the workers
3. To ensure the participation of trade unions
in industry.
4. To avoid the need for government
intervention
5. To promote Industrial democracy.
CHARACTERISTICS

1. Flexible and mobile and fixed or static

2. A group action as contrasted to individual action
3. A voluntary and not an obligatory process
4. Divergent interests at commencement
5. A two party process
6. Dynamic and not static
7. Basically complementary process, not
competitive
8. An art and an advances from of human relations
9. A continuous process
10. Industrial democracy at work
Collective Bargaining Process
Prepare

Discuss

Propose

Bargain

Settlement
 Pre-Requisites of successful
Bargaining
1. Employers recognition of the trade union
2. Bargaining must precede other measures
3. Discussion issues
4. Employers and employees attitude calls for a
change
5. Top priority to plant level bargaining
6. Negotiations on differences
7. Reliance on facts and figures
8. Giving up of unfair labour practices
9. Written agreement
10. Progress review
11. Respect of agreement
 Function of Collective
Bargaining
Efficient functioning
Fair rates of wages
Prompt and fair redressal
Uniform conditions of employment
Economic strength
Promote the stability and prosperity
Regulation of the conditions of employment
Sickness in industry
Chances for conflicts are reduced
Extends the democratic principle
New and varied procedures
System of industrial jurisprudence
 Factors Obstructing Collective
Bargaining Functioning

1. Enough time and energy

2. Separatist tendencies
3. Permanent feature
4. Factual information
5. Absence of a willingness
6. Unfair practices
7. Unequal strength
Importance of Collective Bargaining
1. Direct involvement
2. For better understanding
3. Flexible for term & condition
4. Established a code for rights and
obligation
5. Its pragmatic & democratic method
Principles of Collective Bargaining
For Union and Management
1. Education as well as a bargaining process
2. Mean of finding the best possible solution
3. Command the respect of each other
4. Mutual confidence
5. National and state laws
6. Able and responsible leadership
7. There must be mutual understanding
between two parties
Principles of Collective Bargaining
For the Management:
1. Realistic labour policy:
2. Employee goodwill:
3. Employee grievances:
4. Fairly treated:
5. Social consideration:
6. One trade union:
For the trade unions:
1. Racketeering and other undemocratic
practices:
2. Economic implications:
3. Restrictive rules and regulations:
4. Strikes:
5. Only function:
 Causes for failure of collective
bargaining

1. Problems with unions:

2. Problem from government:
3. Political interference:
4. Legal problems:
5. Management attitude:
 Suggestions for better functioning of
collecting bargaining

1. Progressive and strong management:

2. Truly representative:
3. Unanimity between labour and
management:
4. Delegation of authority:
5. Willingness to use new tools:
Industrial disputes
An industrial dispute may be defined as a
conflict or difference of opinion between
management and workers on the terms of
employment.

It is a disagreement between an
employer and employees' representative;
usually a trade union, over pay and other
working conditions and can result in
industrial actions
Nature of disputes
According to the Industrial Disputes
Act,1947, industrial disputes mean any
dispute or difference between employers
and employers, or between employers 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 (S2(K)).
 Methods of settlement of industrial
disputes.

1. Collective Bargaining
2. Grievance Procedure
3. Arbitration
4. Code of Discipline
5. Conciliation
6. Adjudication
7. Consultative Machinery
ARBITRATION
Arbitration, a form of alternative dispute
resolution (ADR), is a legal technique for
the resolution of disputes outside the
courts, where the parties to a dispute
refer it to one or more persons (the
"arbitrators), by whose decision they
agree to be bound.
Arbitration is effective as a means of resolving disputes
because it is :

.Established by the parties themselves and the decision is

acceptable to them, and
.Relatively quick when compared to courts or tribunals.
Delays are cut down and settlement are speed up.
Arbitration is effective as a means of resolving disputes
because it is :

.Established by the parties themselves and the decision is

acceptable to them, and

.Relatively quick when compared to

courts or tribunals. Delays are cut down and settlement are
speed up.
Weakness :

.Arbitration is expensive.
The expenditure needs to be shared by the labour the
management.

.Judgment becomes arbitrary if there is a mistake in

selecting the arbitrator.

.Too much arbitration is not a sign of healthy IR.

Benefits of Arbitration

Well-managed arbitrations can deal efficiently

with a vast range of disputes.

Small, non-complex disputes can usually be

resolved within weeks, while even the largest and
most complex disputes should only require a few
months to resolve an attractive proposition
compared to the years such disputes take in the
courts.

Well-managed arbitrations are much cheaper and

quicker than conventional litigation. Parties are
generally more satisfied with the outcomes as
they are more involved in the process and gain a
 Conciliation
Conciliation is the process in which the parties try to
reconcile their differences. A third party acting as an
intermediary (independent of the two parties and acting
impartially) seeks to bring the disputants to a point where
they can reach agreement. The conciliator has no power of
enforcement and does not actively take part in the
settlement process but acts as a broker, bringing people
together.
 It is a process of settling disputes by holding bilateral

discussion between both the sides in the presence of a

third party.
Though conciliation and mediation are
interchangeably used, there is slight difference between
these two terms.
Conciliation may be both compulsory and voluntary

in types.
 The industrial disputes act, 1947 provides for

the appointment of conciliators. Section 4 of the act

states that the appropriate government shall
appoint such number of persons as it thinks fit as
conciliation officers. The main duty of conciliation
officer shall be to mediate in and promote the
settlement of industrial disputes. The other duties
are:-
To hold conciliatory proceedings

To investigate the dispute

To send a report and memorandum of

settlement to the appropriate government and,
 Adjudication
If despite efforts of conciliation officer, no
settlement is arrived between employer and the
workman, the government may refer it for
adjudication. Hence it is a compulsory method
which provides for three-tier system for adjudication
of industrial disputes. They are:-
Labor Court.(section - 7)

National Tribunal. (section 7A)

Industrial Tribunal. Section 7B)

MANAGING GRIEVANCE
PROCESS
A grievance..
can be any discontent or dissatisfaction,
whether expressed or not, whether valid or
not, and arising out of anything connected
with the company that an employee thinks,
believes, or even feels as unfair, unjust, or
inequitable.
 Grievance vs Discipline
GRIEVANCE
Provides the
employer with a
process for resolving
a complaint they are DISCIPLINE

unable to resolve Gives employer a process for handling

an employee who is not meeting the
through regular expected standards of performance or
behaviour.
communications with
their
superior/manager

57
Purpose of the Grievance Procedure

Allow employees and management to

resolve problems

Allow employees to voice concerns

workplace and environment

Keep lines of communication open

58
 Steps in the Grievance Process
The number of steps in the grievance process
differ according to the union involved, but
each
contain the following:
Oral Grievance
Written Grievance
Grievance Advanced to Employee/Industrial
Relations

59
Steps in the Grievance Process
ORAL GRIEVANCE:

Employee presents oral grievance to

immediate supervisor within timeframe
specified by Company policies.

Immediate Superior provides written response

to the oral grievance within timeframe .

60
 Steps in the Grievance Process
WRITTEN GRIEVANCE:

If the oral grievance is not satisfactorily adjusted:

The aggrieved can submit the grievance in writing to the

department head on a standard grievance form signed by the
employee.

The grievance must be submitted in writing within the

timeframe specified in Company Policy.

The department will arrange a grievance meeting between the

department head and the grievant.

The Department shall submit a written response to the

grievance within timeframe specified in Company Policy.
61
Steps in the Grievance Process

GRIEVANCE ADVANCED TO EMPLOYEE/LABOR RELATIONS:

If the matter is not satisfactorily adjusted in the previous

(written) step,
or an answer is not given within the time specified:

The written grievance previously submitted shall be

forwarded to the Human Resource Department within the
timeframe.

If the matter is not satisfactorily adjusted in the previous

(written) step,
or an answer is not given within the time specified:

The written grievance previously submitted shall be

forwarded to the Managing Director within the timeframe.
On policy matters only.
62
 PREPARING THE GRIEVANCE RESPONSE

Adhere to the timeline for your response.

Provide an answer that is concise and complete.

Brevity is important. If you need help in
providing an answer, obtain assistance from
Employee / Industrial Relations officer/manager.

Obtain acknowledgement of receipt of your

answer from the grievant/steward, including time
and date.

63
 Disputes are generally referred to a
adjudication on the recommendation of the
conciliation officer who had dealt with them
earlier.
Once a dispute is referred to for adjudication,

the verdict of a labor court or tribunal is binding

on both the parties.
Code of discipline
Why Code Of Discipline Is Necessary.

To maintain harmonious relations and

promote industrial peace, a Code of
Discipline has been laid down which applies
to both public and private sector
enterprises. It specifies various obligations
for the management and the workers with
the objective of promoting cooperation
between their representatives.
Objectives of code of
discipline

Maintain Pease and order in industry.

Promote constructive criticism at all level of
management & employment.
Avoid work stoppage in industry.
Secure the settlement dispute and
grievances by a mutual agreed procedure.
Facilitate a free growth of trade union.
Avoiding litigations.
Procedures For Code
of Discipline .
Step 1: Verbal warnings.
This step will not apply in cases of serious
misconduct.
This will normally be the first formal action
instituted against an employee for failure to
meet performance requirements, breach of
the terms of employment of the company
or other work rules.
Step 2: Written warning.
These written warnings may be used when the
verbal warning(s) fail(s) to produce the required
results or where stronger action than a verbal
warning is required.
The supervisor can record, in writing, the incident
that gave rise to the issuing of such written
warning, (see Annexure "E")
A copy of the warning shall be handed to the
employee for which the employee shall be
required to sign acknowledgement of receipt. If
refusing to sign, a witness should sign in the
presence of the accused, confirming that the
warning was issued.
A copy of such warning will be included in the
employee's personnel file. Written warnings
Step 3: Final Written Warnings:

This step may be used where previous verbal and written

warnings had failed to
produce required results and/or where stronger action than the
above mentioned is required.
The relevant supervisor will record in writing the incident which
gave rise to the issuing of the final written warning, (see
Annexure "F")
A copy of the warning shall be handed to the employee for which
the employee shall be required to sign acknowledgement of
receipt.
A copy of such final warning will be included in the employee's
personnel file.
Final Written Warnings should be issued as soon as possible after
the incident came to management's attention. Final Written
Warnings shall remain valid for a period of six (6) months.
Step 4 Dismissal:
This step may be used where previous written
warnings have failed to produce
required results or stronger action than either First or
Final Warnings are necessary due to the seriousness of
the offence.
Following a pre-investigation, the relevant supervisor
will record in writing the incident, in the form of a
notification to attend a disciplinary hearing.
The employee shall be issued with a copy of such
notice and the hearing shall be set down in accordance
to this procedure, The employee is entitled to
reasonable time to prepare for the hearing.
If possible, an impartial chairperson will be appointed,
alternatively, the designated manager will act as
chairperson of the said disciplinary hearing.
If the employee is dismissed, the employee will be
given the reasons for the
Consultative machinery
Set by the government to resolve the
conflicts
Brings parties together for mutual
settlement of differences in spirit of co-
operation and goodwill.
It operates at plant, industry, state and
national level.
At Plant level,
Works Committees(Industrial Disputes Act 1947)
and Joint Management Councils(Industrial Policy
Resolution 1956)
At Industry Level,
Wage Bonds and Industrial committees.
At State Level,
Labor Advisory Boards.
At National Level,
Indian Labor Conference(ILC) and Standard Labor
Committees.
The Industrial Disputes Act
1947
Introduction
This act was enacted to provide a basic legal
framework for dealing with industrial disputes and
their settlement. It also aims at improving the
working conditions of the industrial workforce,
including peace and harmony at work.
Whether an establishment is to be covered under
the definition of industry or not, can be determined
by the triple test:
1. There must be a systematic activity.
2. It must be organized by cooperation between the
employer and employees.
3. It must be carried on for the production and
distribution of goods and services calculated to
satisfy human wants and wishes
. the little research laboratories, domestic activity,
agricultural activities (not commercial in nature),
spiritual and religious institutions, etc.
The Industrial Disputes Act, 1947 can broadly be
divided into two parts:

1. Authorities for settlement of Disputes

2. Potential forms of Industrial Disputes
 Authorities for settlement of Disputes

Works Committee
Industries employing 100 or more number of workers must
form a Work Committee.

Grievance Settlement Authorities

The individual dispute should not be referred to the
adjudicatory authorities unless it is referred to the Grievance
Settlement Authority.
 Conciliation Officer
He is an authority appointed by the appropriate government
The role of the conciliation officer is to mediate between both
the parties, eliminate deadlock, and help them to come to an
amicable solution. Any agreement arrived in the process, if
signed by the conciliation officer, becomes a settlement and is
binding on both the parties. The conciliation officer has to
submit a report to the appropriate government within 14 days
 Board of Conciliation
A board is to consist of an independent chairman
and two or four members representing the parties
to the disputes. The board will investigate the matter and
endeavor to bring about a settlement like the conciliation
officer. The time period of board to operate is two months.

Court of Inquiry
The purpose of the court is to enquire about the matter
connected with the disputes.
 Labour Court
To act as the Presiding Officer of a Labour Court, the person
must be or must have been a Judge of the High Courrt, or have
at least three years of experience as a District Judge or an
Additional Judge, or seven years of experience in any judicial
office, or must have acted not less than five years as an officer
of a Labour Court constituted under the Provincial or State Act.
 Industrial Tribunal

The appropriate government is empowered to constitute

To act as the Presiding Officer of the Tribunal, the person must

be or must have been a Judge of the High Court, or must have
minimum three years of experience as a District Judge or an
Additional Judge.
 National Tribunal

The central government can constitute

The judge of a High Court can act as a presiding officer of a
National Tribunal.

Arbitrator
POTENTIAL FORMS OF
INDUSTRIAL DISPUTES
POTENTIAL SOURCES OF I D
Strike
Lock-out
Lay-off
Retrenchment
Closure
STRIKES
Strikes is a cessation of work by a body of
persons employed in any industry, acting in
combination, or a concerted refusal under a
common understanding, of a number of
persons who are or have been so employed
to continue to work or to accept
employment.
 TYPES OF STRIKES
Stay-away Strike
Stay-in Strike or Sit-down Strike
Tools-down, pen-down or mouth-shut Strike
Token or protest Strike
Lightening or Wildcat Strike
Go slow
Work to rule or work to designation
TYPES OF STRIKES cont.
Picketing
Boycott
Gherao
Hunger strike
Sympathetic strike
LOCK-OUT
A lock-out means the closing of a place of
business or employment or the suspension
of work, or the refusal by an employ any
number of person employed by him.
Do not constitute a lock-out
Prohibiting an individual employee is not a
lock-out.
Termination of employment by
retrenchment does not lock out.
Termination of services of more than one
person at the same time would not be lock
out.
LAY-OFF
Lay off means the failure, refusal or
inability of employer on account of
shortage of coal, power, or raw material or
the accumulation of stock or the break
down of machinery to give employment to
a workman whose name is borne on the
muster rolls of his industrial establishment
and who has not been retrenched.
RETRENCHMENT
Retrenchment means the termination by
the employer of the service of a workman
for any reason what so ever otherwise than
as a punishment inflicted by way of
disciplinary action, but does not include.
CLOSURE
It is the permanent closing down of the
operations of the industry.