Industrial Relations

What is IR ?
• refers to all types of relationships between employer and
employees, trade union and management, works and union
and between workers and workers.

• the complex interrelations among managers, workers and

agencies of the governments.

• the process of management dealing with one or more unions

with a view to negotiate and subsequently administer
collective bargaining agreement or labour contract.
 Characteristics
• providing information to employees regarding the goals of
the organization so that they have a better understanding
of the aims and policies of the management.

• informed about their poor performances and ways and

means to correct performance.

• takes care of grievances and the problems of the

employees and let them know all about their rights and
what to do in case of discrimination.
 Characteristics of IR in India
• Employer/Management in Retrospect and Historically used to consider
Trade Unions as a necessary evil of the Industrial System

• The trade union perceive their main task is to challenge and oppose
decisions of employer/management

• Trade unions are poorly organized in the country

• The parties are largely in disagreement over the cope of collective

bargaining and various issues to their negotiation process

• Bargaining between employers and unions is very much centralized

• The employers are highly organized

• The Indian Industrial Relations is changing over time

 Objectives

• Employer to Individual employee

relationship

• Labour Management

• Industrial Peace and Productivity

 Preconditions

• Strong, independent workers' and employers' organizations

with the technical capacity and access to relevant
information to participate in social dialogue;

• Political will and commitment to engage in social dialogue

on the part of all the parties;

• Respect for the fundamental rights of freedom of

association and collective bargaining; and

• An enabling legal and institutional framework.

 Factors influencing employee relations

• Institutional factor
• Economic factors
• Technological factors
• Psychological factors
• Political and legal factors
 Institutional/Organizational factor
• HR policies and practices

• Organizational climate and culture and value systems

• Adaptability to change

• Codes of conduct

• Collective bargaining agreements

• Labour unions

• Employers’ organizations/ federations

 Economic factors

• Type of ownership: public or private

• Nature and composition of the workforce

• The source of labour

Technological Factors

• Work methods
• Type of technology
• Rate of technology change
• Ability of organizations and people to cope with change
 Psychological Factors

• Owners’ attitude

• Perception of the workforce

• Workers’ attitude towards work

• Their motivation, interest, dissatisfaction and boredom

leading from man-machine interface.

• These have a great impact on job and personal life factors

and hence indirectly impact IR
 Political and Legal

• Prevalent Political philosophy

• The ruling party/ ideology

• Labour laws and The legal framework for IR

• Role of political factions in TUs

 Perspectives

• Unitarian- ‘one happy family’

• Pluralistic- predominantly managerial

• Marxist – societal reasons

 Unitarism

Assumptions about workplace relations

- management and employees share common interest

- one source of legitimate authority (management)

Assumptions about workplace conflict

- inevitable, aberration, destructive, to be avoided

- caused by poor management, dissidents, agitators or poor

communication

Assumptions about trade unions

- a competing and illegitimate source of authority

- an unwarranted intrusion in the workplace

- create conflict where none would otherwise exist

 Pluralist

Assumptions about workplace relations

- managers and employees have different objectives

- multiple sources of legitimate authority

Assumptions about workplace conflict

- inevitable, caused by different opinions and values, benefit to

an organisation

- avoid by accepting trade unions, include in decision-making

Assumptions about the workplace role of trade unions

- not the cause of conflict

- are expression of diverse workplace interests that always exist

- a legitimate part of workplace relations

 Marxist

Assumptions about workplace relations

- reflects a wider class conflict between capital and labour

- reflects coercion of working class into dominant capitalist values

Assumptions about workplace conflict

- inevitable: capital seeks to reduce costs, workers seek fairer price for
labour

- will only cease by revolutionary change in distribution of property and

wealth

Assumptions about trade unions

- should raise revolutionary consciousness of workers

- should not limit action to improving material lot of workers

- union leaders who accommodate management betray the workers

 Contributors of IR/ER

• Trade Unions
• Managerial Associations
• Employer’s Association
• Government/State
Trade Unions
 Managerial Association

• Officer’s Union

• Registered under the Societies Registration Act, 1860 or Trade Union Act, 1926

• Officers do not like their association to be equated with a trade union

• The purpose is not very much different than that of a trade union

• The meaning and strategies may differ

• In India, it is generally prevalent in public than private

• Banks , life insurance and general insurance

• Undertaking like, Coal India, Steel Plants, Indian Oil Corporation, Hindustan
Petroleum, Bharat Petroleum, Air India are well organized and ventilate grievances
through associations

• Some of these associations not only make collective representations to government but
they also stage strike, gherao, dharnas etc. State Bank of India have staged strikes and
even resorted to bringing banking operations to stand still
 Eligibility
• The officers eligible for membership are
below the level of Director

• May be from the rank of trainees and upward

to the rank of Deputy General Manager in
some cases even General Manager

• Junior or middle level managers provide

leadership
 Why?

• Feeling of “ relative deprivation”

• Feeling of insecurity

• Growing harassment of managerial staff by their

subordinates

• To be a third force between the working Class and the

management
 Employer’s Association
• Formal groups of employers set up to defend, represent or advise affiliated
employers and to strengthen their position in society at large with respect to
labour matters as distinct from economic matters

• Unlike Trade unions, which are composed of individual persons, employer’s

associations are composed of enterprises.

• The Chambers of Commerce are usually set up to defend the economic

interests of employers
• There are sectorial associations also like Confederation of Indian Industry
(confined to engineering industry)

• EA came into existence as a result of the formation of International Labour

Organization (ILO) and growing presence of trade Union

• The Royal Commision on Labour recommended that Indian employers need

an organization “to deal with labour problems from employer’s point of view”
 Objectives

• Primary

➢ Promote and protect the interests of employers engaged in industry, trade and
commerce in India

➢ Study, analyse and disseminate information relating to labour policy, labour-

management relations, collective bargaining etc.

➢ Offer advice concerning various aspects of labour policy

• Secondary

➢ Train and develop staff and members

➢ Obtain data on wages and conditions of work in

industries attached to them

➢ Deal with safety and health at work place and working

environment
 Structure (4 levels)

• Local organizations :

➢ Serve the interest of local businessmen

➢ Eg, Bombay Mill Owner’s Association – to protect interests of manufacturing

units operating within the city

➢ Operate through local chambers of commerce

• Regional organizations:

➢ Offer consultancy services; take care of training, safety and welfare

➢ Special committees for specific region

➢ Employer’s Federation to South India

• Industrial organizations:

➢ Represent industries like , Jute, Textile Steel etc

• Central organizations:

➢ Apex bodies governing the affairs of several regional and local

associations

➢ Eg, All India Organization of Employees (AIOE), Employer’s

Federation of India (EFI), International Organization for
Employers (IOE)

➢ Super structure Council of Indian Employers to bringAIOE, EFI,

IOE into one umbrella
 Role of State in Industrial Relations
• Maintenance of order and stability

• Protection of employees at work in the absence of alternatives

• Maintenance of parity of bargaining power between the main parties

• Economic growth - Productivity and earnings

• Skills acquisition and low unemployment

 Means of State Intervention

• Policies

• Legislation

• Institution

➢ Facilitative

➢ Executive

➢ Judicial
 Changing role of State

The government has played at least six roles in industrial relation in India.
There are:-
i) Laissez faire:
During the 19th century, the government played a laissez faire role in industrial
relations. Under laissez faire the workers and employees were left alone to manage
their affairs.
ii) Paternalism:
By the end of 19th century. The laissez faire role of the government was replaced by
paternalism. Thinkers attracted the attention of the public & the government towards
the human working conditions in factories, mines and plantations. The govt. had also
set up a Royal Commission on labour (1929-31)
iii) Tripartism :
Tripartite form of consultants on the model of the ILO conference. After
independence several such forms were formed. The major tripartite bodies formed:-
Indian labour conference, standing labour committee, industrial committees for
specific industries etc.
iv) Encouragement of voluntarism: –
The government also promotes voluntarism involving a series of code to
regular labour management relations.
These codes include codes of discipline, code of conduct and code of
efficiency and welfare. Specifically the code of disciplines encourages
voluntary arbitration and helps in maintaining discipline at workplace.

v) Interventions:
The government also plays an interventions role. The intervention is
in the form of cancellation and adjudication the industrial dispute Act, 1947
provide such measure to intervene in industrial disputes.

vi) Employer:
The government also plays the role of the largest employer. The
performance of this role influences labour policy also. Obviously the
government takes into consideration the interest of public sector while
framing its policy.