Industrial Relations and Legislations INDUSTRIAL RELATIONS IR is

Industrial Relations and Legislations

INDUSTRIAL RELATIONS • IR is the relationship between employees and management in the day - to - day working of industry. • IR describe relationships between management and employees or among employees and their organisations that which arises out of employment.

Three main participants in IR • Workers and their organisation: trade union • Employers and their organisation: • Government: plays an increasing role in IR by protecting the interest of employees and employers.

The Modern IR Concept Ownership Old Factory owners Classical Govt & Big Business Houses Modern Govt/ Private/ Trust/ MNC Focus Production & Employment Means Only two layers Owners hold top Positions Production Policy to and HR retain Developme employees nt Result / End Hire and Fire Labour Unions Feeling of belongingness

Objectives of IR • Develop and retain employee-employer relationship. • To enhance the economic status of the worker by improving wages, benefits and by helping the worker in evolving sound budget. • To regulate the production by minimizing industrial conflicts through state control. • To socialize industries by making the government as an employer.

Objectives of IR cont……. • To provide an opportunity to the workers to have a say in the management and decision-making. (workers participation in decision making) • To improve workers as strength with a view to solve their problems through mutual negotiations and consultation with the management. • To avoid industrial conflict and their consequences • To extend and maintain industrial democracy.

Factors affecting Industrial Relations • Institutional Factors – State policy, labour laws, collective bargaining agreement, labour unions. • Economic Factors – type of business organization sole proprietorship, partnership, MNC, Govt Economic Policies, labour supply in market. • Social Factors – Cast, colour, social values, norms, social status

• Technological Factors – introduction of new and improved technology • Psychological Factors – owners attitude, perception of workforce, motivation, morale. • Political Factors – political system, system of government political philosophy, attitude of government towards trade unions. • Global Factors – international relations, global conflicts, international labour agreements.

Role of State in IR • The state has direct interest in preserving industrial peace in the country. • To promote healthy growth of trade unions and set up a well organised industrial relations to achieve industrial peace and prosperity. • Industrialized developed and underdeveloped economies steps have been taken by the state to promote a healthy growth of trade union. • The state intervention has been deemed necessary because there are numerous labour organizations which are relatively weak and all employers cannot be trusted.

• Changing role of state Govt. Laissez Faire: During 19 th century govt played a laissez faire role in industrial relations. Under this the workers and employees were left alone to manage their affairs. • Paternalism: By the end of 19 th century laissez faire was replaced by paternalism. Thinkers like Robert, Rusin and others attract the attention of Govt and public towards inhuman working conditions of factories & mine workers. Govt has also set up a royal commission on labour. •

• Tripartism: Consultancy. • Encouragement of Voluntarism: govt given code of discipline, code of conduct and code of efficiency and welfare. • Interventions: Government also plays an interventions role, in the form of conciliation and adjudication. • Employer: Government also plays the role of employer.

Evolution of IR in India • Employee – employer relationship • Employers are the people who own the instrument and material of production and employ the workers. • Relationship between employee-employer was informal, personal and intimate since the business and industrial establishments were small. • The growth of the giant sized joint stock companies and business corporations, which employed thousands of workers changed the relationships.

• In India occupations were carried on by small manufacturers in their cottages, mostly on hereditary basis. • Slavery was common. • Master-slave relations later on converted to masterservant. • The Indian craft and arts were badly damaged during the invasions of foreign invaders, which lasted about 700 years • After invasion of East India Company in 1883, the British Industrialist developed some industries (cotton, jute, railways plantation, coal mines, etc. )

• Industrial relations is a by product of industrial revolution , it originates from excessive exploitation of workers by the owners of industries. • Trade unions were resisted and crushed by employers. • The first world war is the first milestone enroute to industrial relations in India. • After war prices of consumer good goes up and workers were unable to afford it.

• Other events which accelerated the pace of industrial relations: • • • Success of Russian Revolution in 1917 Formulation of ILO AITUC was established in 1920 In 1924 labour party Government formed in U. K. The Indian Trade Union Act 1926 Royal commission on Labour (1929 -31) was formed.

• By the end of 19 th century and start of 20 th century govt. started paying attention towards inhuman working conditions of mine & factory workers. • British Government set up a Royal Commission on labour (19291931) to conduct a study on the working conditions of Indian Labour. • As a result of the same conciliation and adjudication were formulated.

• After Independence Industrial Dispute Act, 1947 • Which laid down a comprehensive dispute settlement machinery to be applicable to all states and passed three important Central Labour Laws: The Minimum Wages Act 1948, • The Employees State Insurance Act 1948 • The Employees Provident Funds Act 1952 • • Five year plans of India • In 1969 first National Commission on Labour was formed and many banks, sick textile mills, sick steel plants were nationalized. • New Economic Policies in 1991

TRADE UNIONS • "Trade Union" means any combination, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen, or between employers and employers, or for imposing restrictive conditions on the conduct of any trade or business • Trade unions are formed to protect and promote the interests of their members. Their primary function is to protect the interests of workers against discrimination and unfair labor practices.

Objectives • Representation • Negotiation • Voice in decisions affecting workers • Member services (a) Education and training (b) Legal assistance (c) Financial discounts (d) Welfare benefits

Functions of Trade unions (i) Militant functions a) To achieve higher wages and better working conditions b) To raise the status of workers as a part of industry c) To protect labors against victimization and injustice

(ii) Fraternal functions • To take up welfare measures for improving the morale of workers • To generate self confidence among workers • To encourage sincerity and discipline among workers • To provide opportunities for promotion and growth • To protect women workers against discrimination

Importance Of Trade Unions • Trade unions help in accelerated pace of economic development in many ways as follows: by helping in the recruitment and selection of workers. • by inculcating discipline among the workforce • by enabling settlement of industrial disputes in a rational manner • by helping social adjustments. Workers have to adjust themselves to the new working conditions, the new rules and policies. Workers coming from different backgrounds may become disorganized, unsatisfied and frustrated. Unions help them in such adjustment. •

Contd…. Social responsibilities of trade unions include: • promoting and maintaining national integration by reducing the number of industrial disputes • incorporating a sense of corporate social responsibility in workers • achieving industrial peace

Trade Unionism In Indian trade union movement can be divided into three phases. * The first phase (1850 to 1900) * The second phase (1900 to 1946) * The third phase (in 1947).

Trade Union Act 25 March 1926 • The trade Unions Act, 1926 provides for registration of trade unions with a view to render lawful organisation of labour to enable collective bargaining. It also confers on a registered trade union certain protection and privileges.

At present there are twelve Central Trade Union Organizations in India: • • • All India Trade Union Congress (AITUC) Bharatiya Mazdoor Sangh (BMS) Centre of Indian Trade Unions (CITU) Hind Mazdoor Kisan Panchayat (HMKP) Hind Mazdoor Sabha (HMS) Indian Federation of Free Trade Unions (IFFTU) Indian National Trade Union Congress (INTUC) National Front of Indian Trade Unions (NFITU) National Labor Organization (NLO) Trade Unions Co-ordination Centre (TUCC) United Trade Union Congress (UTUC) and United Trade Union Congress - Lenin Sarani (UTUC - LS)

Employer’s Organisation • Employers' Organizations are institutions set up to organize and advance the collective interests of employers. • They are crucial for shaping an environment conducive to competitive and sustainable enterprises that can contribute to economic and social development, and by providing services that improve and guide individual performance of enterprises.

• Employers’ organizations are a critical component of any social dialogue process, which can help to ensure that national social and economic objectives are properly and effectively formulated and enjoy wide support among the business community which they represent. • As one of the three constituents of the ILO, employers' organizations have a special relationship with the Organization. The ILO's Bureau for Employers' Organizations - a specialized unit within the ILO Secretariat - is responsible for the nurturing and development of that relationship

• Its task is to maintain close and direct relations with employers' organizations in member States, to make the ILO's resources available to them and to keep the ILO constantly aware of their views, concerns and priorities.

Problems of Trade Union • Multiplicity of Trade Unions and Inter-union rivalry • Small Size of Unions • Financial Weakness • Leadership Issues • Politics involved in Trade Unions • Problems of Recognition of Trade Unions.

International Labour Organisation(ILO) • Established in April 11, 1919 by the Versailles Peace Conference as an autonomous body associated with the League of Nations. • Its first assembly took place in Washington on April 29, 1919 • There were 45 members of the ILO in 1919. • India has been a member of the ILO since its inception.

Objectives of ILO • Full employment and the raising of standards of living. • Workers must be given that employment in which they can have the satisfaction of giving the fullest measure of their skill and make their contribution to the common well being. • Facilities for training and the transfer of labour including migration for employment and settlement.

• Policies in regards to wages and earnings bonus and minimum wages. • Right of collective bargaining. • Social security measures and medical care • Adequate protection by the life and health of workers in all occupations. • Provision for child welfare and maternity protection • Provision of adequate nutrition, housing and facilities for recreation and culture • The assurance of educational and vocational opportunity.

• Since 1945 ILO has expanded its working in three major directions: 1) 2) 3) The establishment of Tripartite International Committees to deal with problems of some of the major industries The holding of regional conferences and meetings of experts to study special regional problems particularly those of underdeveloped region. The development of operational activities

ILO Membership • Today the ILO comprises 183 Member States. • In addition to the States which were Members of the International Labour Organization on 1 November 1945, any original member of the United Nations and any State admitted to membership of the United Nations by a decision of the General Assembly may become a Member of the ILO. • Communicating to the Director-General its formal acceptance of the obligations of the Constitution of the Organization.

Organisational Structure • ILO is a tripartite organisation consisting of representatives of the governments, employers and workers of member countries in the ratio of 2: 1: 1. • Three main organs of ILO: i. iii. The International Labour Conference The Governing Body The International Labour Office

International Labour Conference • The ILC sessions held once a year and is the policy making organ of ILO • Each member country is represented by four member delegates – two representing the Government, one representing the employers and on one representing the workers. • Principal function is to formulate international social standards in the form of International Labour Conventions and Recommendations.

The Governing Body • Governing body is the chief executive body of the organisation and meets several times a year to formulate policy for effective programming of work and setting of agenda for the annual conference. • Membership of 40. • 20 Government representatives, 10 employers representatives and 10 representatives of employees

The International Labour Office • The International Labour office functions as the secretariat of the ILO. • Its main functions are preparation of the documents on varied items of the agents of the meeting of the conference collection and distribution of information on all subjects.

Major Activities of ILO • Creation of International standards of Labour • Employment Creation • Collection and Distribution of Information and Publication • Research & Studies • Training • Improvement of Working conditions and working environment

• These lead to differing IR practices and policies. The nature of industrial relations is determined to a large extent on how we approach and analyze specific issues and situations within industrial relations

1. UNITARY APPROACH • Management and staff, and all members of the organization share the same objectives • Unitary approach demands loyalty of all employees • Conflict is not normal– and is caused by a breakdown in communication etc. • There is no need for unions

• Workplace relations § Both management and employees share common interest § Management is recognized as the legitimate authority • Workplace conflict § Should be avoided § Is caused by poor management , dissidents, agitators or poor communication

2. PLURALISTIC APPROACH • Workplace is comprised of differing interest groups, each in pursuit of their own sectional interests • Temporary compromises on both sides are achieved through Collective bargaining. • The role of management is more toward persuasion and co - ordination rather than towards enforcing and controlling

3. MARXIST CLASSICAL APPROACH • Division of Society • Those who owns the means of production (capitalists) and the ones who have only labour to offer • Maximum productivity in minimum wages

4. HUMAN RELATIONS or NEO- CLASSICAL APPROACH • Believes in positive Nature of humans • Management support Human Initiative

IMPORTANCE OF IR • Uninterrupted production • Reduction in Industrial Disputes • High Morale • Mental Revolution • New Programmes • Reduced Wastage

OBJECTIVES OF IR • To Safeguard the interest • To avoid industrial Conflicts • To increase the productivity • To improve economic conditions of workers • To establish government control