HUMAN RESOURCE MANAGEMENT

STUDENT FRIENDLY SH0RTER VERSION

FOR
B.Tech: CE
CE(OE)801A

Anis Chattopadhyay
Asst. Professor – Techno India.

Techno India
EM4/1, Sector – V,
Salt Lake, Kolkata - 91

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 HRM-meaning, role in an organization, difference with personnel mgmt.

HUMAN RESOURCE MANAGEMENT ( H R M )

Definition 1 – Integration
“HRM is a series of integrated decisions that form the employment relationships; their quality
contributes to the ability of the organizations and the employees to achieve their objectives.”
Definition 2 – Influencing
“HRM is concerned with the people dimensions in management. Since every organization is
made up of people, acquiring their services, developing their skills, motivating them to higher
levels of performance and ensuring that they continue to maintain their commitment to the
organization are essential to achieving organizational objectives. This is true, regardless of the
type of the organization – government, business, education, health, recreational, or social action.”
Definition 3 – Applicability
“HRM planning, organizing, directing and controlling of the procurement, development,
compensation, integration, maintenance and separation of human resources to the end that
individual, organizational and social objectives are accomplished.”
MEANING OF HRM: -
HRM is management function that helps managers to recruit, select, train and develop members
for an organization. Obviously HRM is concerned with the people’s dimensions in organizations.
HRM refers to set of programs, functions, and activities designed and carried out
Core elements of HRM
 People: Organizations mean people. It is the people who staff and manage organizations.
 Management: HRM involves application of management functions and principles for
acquisitioning, developing, maintaining and remunerating employees in organizations.
 Integration & Consistency: Decisions regarding people must be integrated and
consistent.
 Influence: Decisions must influence the effectiveness of organization resulting into
betterment of services to customers in the form of high quality products supplied at reasonable
cost.
 Applicability: HRM principles are applicable to business as well as non-business
organizations too, such as education, health, recreation and the like.
OBJECTIVES OF HRM: -
1. Societal Objectives: To be ethically and socially responsible to the needs and challenges
of the society while minimizing the negative impact of such demands upon the organization.
2. Organizational Objectives: To recognize the role of HRM in bringing about
organizational effectiveness. HRM is only means to achieve to assist the organization with its
primary objectives.
3. Functional Objectives: To maintain department’s contribution and level of services at a
level appropriate to the organization’s needs.
4. Personal Objectives: To assist employees in achieving their personal goals, at least in
so far as these goals enhance the individual’s contribution to the organization. This is necessary
to maintain employee performance and satisfaction for the purpose of maintaining, retaining and
motivating the employees in the organization.

Let us understand it by dividing the term into its subparts.

• Human – people, us
• Resource – assets/costs for organizations
• Management – co-ordination and control to achieve set goals But humans, unlike other
resources in the context of work and management, cause problems.

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For example, if you recruit and select people you should have a clear idea of how you see them
developing and contributing to the performance of the organization. Isn’t it ?? This Employment
Relationship has several dimensions to it:
1. Economic – pay in exchange for effort
2. Legal – employment laws, rights and responsibilities on both sides – contractual
relationship although formality of the contract can vary Freely entered into But is it that
free and equal?
Employment rights may help redress the balance between individual and organisations (as does
collective association or unions)
3. Social – Work is social because it involves various degrees of integration with others:
4. Psychological – mutual expectations and obligations - beyond the formal contract
What do you expect your employer to provide beyond the wage – effort bargain? What is
reasonable in terms of this bargain?
Objectives of Human Resource Management: -
1. The first and foremost objective of human resource management is to have a highly
committed, eligible, talented, and happy workers.
2. Development of employees:- An employee does not come alone into the organization.
What does he bring? He brings with himself abilities, attitude, behavior, personality etc..
3.Growth and development of the organization:-
4. The development of HR function and climate:
SCOPE OF HRM: -
From Entry to the Exit of an employee in the organization
Scope of HRM can be described based on the following activities of HRM. Based on these
activities we can summarize the scope of HRM into 7 different categories as mentioned below
after the activities. Lets check out both of them.
HRM Activities –
1. HR Planning
2. Job Analysis
3. Job Design
4. Recruitment & Selection
5. Orientation & Placement
6. Training & Development
7. Performance Appraisals
8. Job Evaluation
9. Employee and Executive Remuneration
10. Motivation
11. Communication
12. Welfare
13. Safety & Health
14. Industrial Relations
7 Categories of Scope of HRM
1. Introduction to HRM
2. Employee Hiring
3. Employee and Executive Remuneration
4. Employee Motivation
5. Employee Maintenance
6. Industrial Relations
7. Prospects of HRM
ROLE OF HRM
1. Advisory Role: HRM advises management on the solutions to any problems affecting
people, personnel policies and procedures.

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a. Personnel Policies: Organization Structure, Social Responsibility, Employment Terms &
Conditions, Compensation, Career & Promotion, Training & Development and Industrial
Relations.
b. Personnel Procedures: Relating to manpower planning procedures, recruitment and
selection procedures, and employment procedures, training procedures, management
development procedures, performance appraisal procedures, compensation procedures, industrial
relations procedures and health and safety procedures.
2. Functional Role: The personnel function interprets and helps to communicate personnel
policies. It provides guidance to managers, which will ensure that agreed policies are
implemented.
3. Service Role: Personnel function provides services that need to be carried out by full time
specialists. These services constitute the main activities carried out by personnel departments and
involve the implementation of the policies and procedures described above.
Role of HR Managers (Today)
1. Humanitarian Role: Reminding moral and ethical obligations to employees
2. Counselor: Consultations to employees about marital, health, mental, physical and career
problems.
3. Mediator: Playing the role of a peacemaker during disputes, conflicts between individuals
and groups and management.
4. Spokesman: To represent of the company because he has better overall picture of his
company’s operations.
5. Problem Solver: Solving problems of overall human resource management and long-term
organizational planning.
6. Change Agent: Introducing and implementing institutional changes and installing
organizational development programs
7. Management of Manpower Resources: Broadly concerned with leadership both in the
group and individual relationships and labor-management relations.
Role of HR Managers (Future)
1. Protection and enhancement of human and non-human resources
2. Finding the best way of using people to accomplish organizational goals
3. Improve organizational performance
4. Integration of techniques of information technology with the human resources
5. Utilizing behavioral scientists in the best way for his people
6. Meeting challenges of increasing organizational effectiveness
7. Managing diverse workforce
FUNCTIONS OF HRM ALONG WITH OBJECTIVES
HRM Objectives Supporting HRM Functions
Social Objectives (3) 1. Legal Compliance
2. Benefits
3. Union Management Relations
Organizational Objectives (7) 1. Human Resource Planning
2. Employee Relations
3. Recruitment & Selection
4. Training & Development
5. Performance Appraisals
6. Placement & Orientation
7. Employee Assessment
Functional Objectives (3) 1. Performance Appraisals
2. Placement & Orientation
3. Employee Assessment

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Personal Objectives (5) 1. Training & Development
2. Performance Appraisals
3. Placement & Orientation
4. Compensation
5. Employee Assessment

Managerial Functions of HRM

1. Planning: Plan and research about wage trends, labor market conditions, union demands and
other personnel benefits. Forecasting manpower needs etc.
2. Organizing: Organizing manpower and material resources by creating authorities and
responsibilities for the achievement of organizational goals and objectives.
3. Staffing: Recruitment & Selection
4. Directing: Issuance of orders and instructions, providing guidance and motivation of
employees to follow the path laid-down.
5. Controlling: Regulating personnel activities and policies according to plans. Observations
and comparisons of deviations
Operational Functions of HRM
1. Procurement: Planning, Recruitment and Selection, Induction and Placement
2. Development: Training, Development, Career planning and counseling.
3. Compensation: Wage and Salary determination and administration
4. Integration: Integration of human resources with organization.
5. Maintenance: Sustaining and improving working conditions, retentions, employee
communication
6. Separations: Managing separations caused by resignations, terminations, lay offs, death,
medical sickness etc.
CHALLENGES OF HRM IN INDIAN ECONOMY or CHALLENGES OF
MODERN MANAGEMENT
1. Globalization: - Growing internationalization of business has its impact on HRM in
terms of problems of unfamiliar laws, languages, practices, competitions, attitudes, management
styles, work ethics and more. HR managers have a challenge to deal with more functions, more
heterogeneous functions and more involvement in employee’s personal life.
2. Corporate Re-organizations: - Reorganization relates to mergers and acquisitions,
joint ventures, take over, internal restructuring of organizations. In these situations, it is difficult
to imagine circumstances that pose a greater challenge for HRM than reorganizations itself. It is a
challenge to manage employees’ anxiety, uncertainties, insecurities and fears during these
dynamic trends.
3. New Organizational forms: - The basic challenge to HRM comes from the changing
character of competitions. The competition is not between individual firms but between
constellations of firm. Major companies are operating through a complex web of strategic
alliances, forgings with local suppliers, etc. These relationships give birth to completely new
forms of organizational structure, which highly depend upon a regular exchange of people and
information. The challenge for HRM is to cope with the implications of these newly networked
relations more and more, in place of more comfortable hierarchical relationships that existed
within the organizations for ages in the past.
4. Changing Demographics of Workforce: - Changes in workforce are largely
reflected by dual career couples, large chunk of young blood between age old superannuating
employees, working mothers, more educated and aware workers etc. These dynamic workforces
have their own implications for HR managers and from HRM point of view is a true challenge to
handle.
5. Changed employee expectations: - With the changes in workforce demographics,
employee expectations and attitudes have also transformed. Traditional allurements like job

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security, house, and remunerations are not much attractive today, rather employees are
demanding empowerment and equality with management. Hence it is a challenge for HRM to
redesign the profile of workers, and discover new methods of hiring, training, remunerating and
motivating employees.
6. New Industrial Relations Approach: - In today’s dynamic world, even unions have
understood that strikes and militancy have lost their relevance and unions are greatly affected by
it. The trade union membership has fallen drastically worldwide and the future of labor
movement is in danger. The challenge before HRM is to adopt a proactive industrial relations
approach which should enable HR specialist to look into challenges unfolding in the future and to
be prepared to convert them into opportunities.
7. Renewed People Focus: - The need of today’s world and business is the people’s
approach. The structure, strategy, systems approach which worked in post war era is no more
relevant in today’s economic environment which is characterized by over capacities and intense
competition. The challenge of HR manager is to focus on people and make them justifiable and
sustainable.
8. Managing the Managers: - Managers are unique tribe in any society, they believe they
are class apart. They demand decision-making, bossism, and operational freedom. However in the
post liberalization era, freedom given to managers is grossly misused to get rid of talented and
hard working juniors. The challenge of HRM is how to manage this tribe? How to make them
realize that the freedom given to them is to enable them make quick decisions in the interest of
the organization and not to resort to witch-hunting.
9. Weaker Society interests: - Another challenge for HRM is to protect the interest of
weaker sections of society. The dramatic increase of women workers, minorities and other
backward communities in the workforce has resulted in the need for organizations to reexamine
their policies, practices and values. In the name of global competition, productivity and quality
the interests of the society around should not be sacrificed. It is a challenge of today’s HR
managers to see that these weaker sections are neither denied their rightful jobs nor are
discriminated against while in service.
10. Contribution to the success of organizations: - The biggest challenge to an HR
manager is to make all employees contribute to the success of the organization in an ethical and
socially responsible way. Because society’s well being to a large extent depends on its
organizations.

Importance of HRM functions:

􀂙To hire the right person for the job

􀂙To reduce high turnover
􀂙To find out people doing their best
􀂙To reduce idle time
􀂙To reduce discriminatory actions.
􀂙To be quoted under good example of safe practices
􀂙To have some of your employees think their salaries are fair and equitable
relative to others in the organization
􀂙To allow training to instill department's effectiveness
􀂙To commit fairer labor practices
Definition of personnel Management:
“ It is that phase of management which deals with the effective control and use of manpower as
distinguished from other sources of power.”
“ The management of human resources is viewed as a system in which participants seek to attain
both individual and group goals”.

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“ Its objectives is to understand what has happened and is happening and to be prepared for what
will happen in the area of working relationships between the managers and the managed.”
Functions of Personnel Management:
1. The procurement function- obtaining of a proper kind and number of
personnel necessary to accomplish an organization’s goals
2. The development function- personnel development of employees, training
3. The compensating function- securing adequate and equitable remuneration to
personnel
4. The integration function- an “integration” of human resources with
organisation through job enlargement, job evaluation, variable compensation
plans, disciplinary action programmes.
5. The maintenance function- maintaining the physical conditions of employees
(health and safety measures) and employee service programmes

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HRM versus HRD

 HR planning, concept & methods.

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Human Resource Planning
Manpower planning and human resource planning are synonyms. The basic idea of manpower
planning is, we look at the numbers we are likely to need because of growth or contraction,
promotion and wastages. In other words, it simply means ensuring availability of right numbers
of men , right kinds [types in terms of skill], at the right point of time, at the right places for
utilising the most economically and effectively and develop their potentials in terms of skills,
performance and capacity.

Recruitment and Selection

Recruitment is the process of generating of applications or attracting applicants for specific
positions through four common sources, viz. Advertisement, state employment exchange
agencies , present employees and campus recruitment.

Counselling
“Counselling is helping the employee to recognise his own strengths, weaknesses and potential
and potential and helping him to prepare action plans for own development.” Giving feedback in
a “threatening way” or correcting the undesirable or unsatisfactory behaviour of employees by
pointing it out the deficiencies or other malfunctioning and warning them not to repeat these
behaviour are all integral parts of a manager’s role and are not the same as counselling.

1. They give critical and supporting feedback.

2. They discuss with the employee the difference between his self rating and the
rating by the immediate superior.
3. They discuss the steps the employee can take for improvement.
4. They provide support

Career Planning

Career planning involves identifying the right potential well in time, for development to take over
higher responsibilities.

Succession Planning

Succession planning entails in identifying the key jobs in an organisation and ensuring that , if
anything, planned or unplanned were to remove the present job holder from his post, there would
be some one ready to take the place.
Training
Training comprises an integral part of HRD process. The purpose of training is to improve the
capabilities of the human resources in order to increase their efficiency and effectiveness on the
job. Training is expected to indicate positive changes in knowledge, skill and attitudes.

Job Evaluation:

Job evaluation is concerned with establishing the relative worth of a job compared to other jobs
within an organisation. In job evaluation one attempts to consider and measure the inputs required

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of employees (know-how, accountability and problem solving etc.) for minimum job performance
and to translate such measures into specific monetary returns.

Transfer, Promotion & demotion!!!

Transfer is a lateral movement within the same grade, from one job to another. A transfer may
result in changes in duties and responsibilities, supervisory and working conditions, but not
necessarily salary.
Job Analysis

Job analysis is the process of studying and collecting department information relating to
operations and responsibilities of a specific job.

Role Analysis
Role analysis is the process of defining a role in the context of its work system., in terms of
expectation of important persons, detailing specific tasks under each function, and elaborating the
process, standards and critical attributes namely knowledge, attitude, skill, habits (KASH)
required for effective role.

PERFORMANCE APPRAISAL

Definition 1: Systematic Evaluation

“It is a systematic evaluation of an individual with respect to performance on the job and
individual’s potential for development.”
Definition 2: Formal System, Reasons and Measures of future performance
“It is formal, structured system of measuring, evaluating job related behaviors and outcomes to
discover reasons of performance and how to perform effectively in future so that employee,
organization and society all benefits.”

Performance Appraisals and Job Analysis Relationship

Job Analysis  Performance Standards  Performance Appraisals

Describe the work and Translate job requirements Describe the job relevant
personnel requirement of a into levels of acceptable or strengths and weaknesses of
particular job. unacceptable performance each individual.

4 Goals of Performance Appraisals

General Goals Specific Goals
Developmental Use Individual needs
Performance feedback
Transfers and Placements
Strengths and Development needs
Administrative Decisions / Uses Salary
Promotion

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 Retention / Termination
Recognition
Lay offs
Poor Performers identification
Organizational Maintenance HR Planning
Training Needs
Organizational Goal achievements
Goal Identification
HR Systems Evaluation
Reinforcement of organizational needs
Documentation Validation Research
For HR Decisions
Legal Requirements

Difference between Traditional and Modern (Systems) approach to Appraisals

Categories Traditional Appraisals Modern, Systems Appraisals
Guiding Values Individualistic, Control oriented, Systematic, Developmental,
Documentary Problem solving
Leadership Styles Directional, Evaluative Facilitative, Coaching
Frequency Occasional Frequent
Formalities High Low
Rewards Individualistic Grouped, Organizational

Performance Appraisal is an objective assessment of an individual’s performance against well

defined benchmarks job analysis sets out requirements which are translated into performance

Job Analysis Performance standards Performance Appraisal

Describes work and Translate job Describes the job

personnel requirement requirements into levels relevant strengths and
of a particular job of acceptable or weakness of each
unacceptable individual
performance

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Motive of Performance Appraisal

Administration needs, Development of the employee,

Programme Assessment

a) To create and maintain a satisfactory level of performance.

b) To meet an individual’s development needs,
c) To bring about better operational or business results.
d) To facilitate fair and equitable compensation based on performance,
e) To help the superiors to have a proper understanding about their
f) Subordinate.
g) To provide information useful for manpower planning by identifying employ with a
potential for advancement.
h) To facilitate testing and validating selection tests, interview techniques dir comparing their
scores with performance appraisal ranks.
The Appraisers:

1. The immediate manager or supervisors

2. The employee’s peers
3. The employee himself- - i.e., self appraisal
4. The employee’s subordinates,
5. Other managers familiar with the employees work
6. A higher-level manager
7. Personnel department specialist.
Purposes

1) To enable an organization to maintain an inventory of the number and quality of all managers
and to identify and meet their training needs and aspiration.
2) To determine increments and provide a reliable index for promotions and transfer to position
of greater responsibility.
3) To maintain individual and group development by informing the employee of his
performance standard.
4) To suggest ways of improving the employee’s performance when one is not found up to the
mark.

5) Performance Appraisal provides a process of dialogue between the superior and subordinate
and improves understanding of personal goals and concern.
6) Performance Appraisal assess the training and development needs of employee.

IMPORTANCES

Performance, Making Correct Decisions, Minimizing Cost of Litigation, Increase Job

Satisfaction and Less Employee Turnover, Consistent Organizational Strategy and Behaviour

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Method / Techniques:

(A) Traditional Methods

(1) Straight Ranking Method or Rating Scales

(2) Paired Comparison Technique

(3) Man to Man Comparison Method or Factor Comparison Method

(4) Grading Method

(5) Forced Choice Method:

(6) Forced Distribution Method

(7) Critical Incident Method

(8) Group Appraisal Method

(9) Field Review Method

(10) Checklist

(11) Free Essay Method

(12) Confidential Records

(B) Modern Methods:

1. Appraisal by Result or Management by Objectives (MBO):

(2) Psychological Appraisals

3) Assessment Centres:

(4) Human Asset Accounting Method

(5) Behaviorally Anchored Rating Scales (BARS – BARS ) are said to be behaviorally
ancored as the scale represents a range of descriptive statements of behaviour varying from
external poor performance. Poor performance neither poor nor good performance. Slightly good
performance good performance to extremely good performance. BARS are having the following
features -

(i) Persons who are having the knowledge of the job are asked to describe specific
illustration of effective and ineffective performance behaviour.
(ii) These people then cluster the incidents into a smaller set of performance dimension.
(iii) A group of people who is actually having the knowledge of the job reallocate these
original critical incidents.
(iv) This group is meant to rate the behavior described in the incident to measure the
performance on the appropriate dimension.
(v) Some subject of incidents are used as behavior for the performance dimension.

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 (vi) A rater is expected to indicate which behaviour each scale best describes an employee’s
performance.
(6) 360 Degree Feedback

Errors

1. Leniency or Severity of Stricture

2. Central Tendency

3. Rater Effect:

4. Perceptual Set

5. Setting of Performance Dimension:

6. Halo Effect:

7. Spill over Effect

8. Status Effect:

9. Similarity Error

10. Primacy and Recency Effects:

11. Miscellaneous Biases

12. Social Differentiator

HR planning process:

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 WAGE, SALARY AND COMPENSATION MANAGEMENT

Wages mean any economic compensation paid by the employer under any contract to the workers
for the services rendered by them. Any remuneration consists of two parts (a) basic salary (b)
allowances.

Essentials of Sound Wage Plan:

Simple:

Minimum Guaranteed Earnings

Additional Payments and Allowances:

Equal to All:

Easy Collective Bargaining:

Factors Influencing Wage Structure:

Ability of the organization to pay.

1. Demand for Labour

2. Market Rate
3. Cost of living Index
4. Productivity6. Job requirements
5. Attitude of the management
6. Bargaining power of the Trade Union.
The principles governing the fixation of wages are

1. Job Requirements: Wages should be based on the variations in job requirements as skill,
effort, responsibility, labour market.
2. Criterion: The level of wages paid should be in line with the prevailing rate in labour
market.
3. Equal Pay for Equal Work: If two jobs have the same requirements and responsibilities,
the pay should be the same.
4. Reasonable Standard of Living: Workers should receive a guaranteed wage to assure them
of a reasonable standard of living.
5. Flexible Wage Structure: The wage structure should be flexible so that required conditions
can be easily met
6. Distinguish between Jobs and Employees: A job should carry a certain skill; person should
be assigned to fill it at that rate.
7. Avoid Secrecy in Wage Matters: Every employee should be informed at procedure used to
establish wage rates.
8. Appointment of Wage Committee: For revision of wages, a wage committee be appointed,
as individual judgment could be biased

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Pay Policy

The pay policy includes the following:

1. Fair Wages: The next higher level is fair wage. The Fair wage is wage which lies above
the minimum wage but lies below the living wage.
2. Minimum Wages: According to Committee (as Fair wages set up by the government in
1948)the minimum wage should represent the lower limit of a fair wage. “the wage
which provide not only for the bare sustenance of life, but for the preservation of the y of
the worker. For this purpose, the minimum wage must provide for some of education,
medical requirements and amenities”.
3. Living Wages: the highest level is living wage. According to the Committee, the Living
Wage is one which enable the earner to provide for himself and his family not only the
basic essentials of food, clothing and shelter, but a measure of frugal contrast including
education for his children protection against ill health, requirements of essential social
needs, measure of insurance against the most important misfortune including old age
Types of wages:

(1) Time wage: Workers are paid according to the work done during a certain period of time at
the rate of so much per hour, per day, per week, per fortnight or per month or any other fixed
period of time.

(2) Piece Wage: Under this system workers are paid in proportion to his physical output.
Workers are paid according to the amount of work done or the number of units completed on the
basis of pre determined rate.

(3) Balance or Debt Method: The worker is guarantee 1 an hourly or a day rate with an
alternative piece rate. It the earnings of a worker calculated at the piece rate exceed the amount
which he would have earned. If paid on time basis he gets credit for balance i.e. the excess piece
rate earnings over the time rate earning.

Wage differentials:

Wages differ in different employment or occupation industries & localities & also between
person in the same employment or grade. Wage differentials can be of the following types

(i) Occupation at Differentials

(ii) Regional Differentials

(iii) Inter-occupational Differentials

(iv) Inter-Industry Differential

(v) Personal Wage Differentials:

Fringe Benefits:

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Any benefits or services that employee receives in addition to direct remuneration is called Fringe
Benefits. Fringe should have the following features : (a) It is computable in terms of money (b)
The amount is not predetermined (c) No contract exists for the sum . Fringe does the following
things (a) try to reduce fatigue (b) try to reduce labour unrest (c) satisfy employee objectives (d)
aid recruitment (e) try to reduce employee turnover (f) try to minimize overtime costs.

In following paragraphs we can cite examples of some fringe benefits:

(1) Legally required payments

(i) old age, survivors, disability & health insurance i.e. social security

(ii)Workers’ compensation (in) unemployment compensation

(2) Contingent and deferred benefits

i) Pension plans
ii) Group Life Insurance
iii) Group health Insurance
(a) Medical expenses (b) Disability Income

iv) Guaranteed Annual Wages

v) Prepaid legal plans
vi) Maternity leave
vii) Child Care leave
viii) Sick Leave
ix) Dental benefits
x) Tuition benefits
xi) Suggestion awards
xii) Service awards

(3) Payment for time not worked

(i) Vacation (ii) Holidays

(4) Other benefits

(i) Travel Allowance (ii) Company Car & Subsidies (iii) Moving expenses

(iv) Uniform & tool expenses (v) Employee Meal Allowance (vi) Discount

on employers’ goods & services (vii) Child Care facilities.

(5) On the job facilities

(i) more responsibility (ii) Job rotation (iii) Training (iv) Special assignment

(6) Office Environment

(i) Redecoration (ii) Piped Music (iii) Flexible hours

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(7) Treats

(i) Free Lunches (ii) Festival bashes (iii) Coffee Break (iv) Picnics

(v) Dinner with boss (vi) Dinner for family (vii) Birthday treats

(8) Knick – Knacks : (i) Company Watches (ii) Tie-Pins, brooches (iii) Calendars (iv) Wallets
(v) Desk accessories

(9) Tokens: (i) Movie tickets (ii) Vacation Trips (iii) Anniversary/birthday allowances/ presents
etc.

A sound fringe benefit programme can be designed by:

(1) Establishing benefit objectives: Benefits have the following objectives (a) Nurturing external
competitiveness (b) meeting individuals needs & preferences (c) increasing cost effectiveness (d)
complying with legal compulsions.

(2) Assessing Environment: External environment which include government policies &
regulation tax policies. Other benefit laws which determine fringe benefits, Organizational
strategic & objective, employee preference, & demographics. Labour unions which constitute the
internal environment also determines the fringe benefits.

(3) Competitors: Organizations plan the benefit programme to outstrip the competitors.

(4) Communication of benefits: Benefit programmes should be communicated to employees,

through booklets, brochures, slide presentation or though employee meetings.

(5) Cost-benefit analysis: Cost of fringe benefits comprises of the following :

(i) Total cost of benefits annually for employees

(ii) Cost per employee per year
(iii) Percentage to annual payroll
(iv) Cost per employee per hour.

EMPLOYEE BENEFITS AND SERVICES

These are available to all employees based in their membership in the organization. The purpose
of such benefits and services is to retain people in the organization and not to stimulate them to
greater effort and higher performance.

These benefits are usually known as “fringe benefits”, & the employer offers these to the
employee. The term fringe benefits are as follows – paid vacation, pension, health insurance plan
etc.

There are five categories of services and benefits under the term fringe benefits.

• Legally Required Payments: - Old age pension, survivor benefits, disability pension and
payments made under the Workmen’s Compensation Act.
• PENSION AND GROUP INSURANCE: -

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 • PAID REST PERIODS, WASTE-UP TIME
• PAYMENT FOR TIME NOT WORKED
• FESTIVAL BONUS

CLASSIFICATION OF FRINGE BENEFITS: -

• Premium Payments: - This is the period of time a worker has worked, and payment is
based on daily or weekly.
• Payment for special duties: - Such as working on grievance redressal procedures and
labour contract negotiations.
• Payments for health & Security benefits: - These include retirement plans, social
security payments, Saving plans, Profit sharing plans, Group Life Insurance etc.
• Payment for time not worked: - Which include payment for sick leave and for time
during which an employee is under medical care. Payments for holiday, vacations, call
back time, dressing time, portal-to-portal time and wet time.
• Payment for employee service: - This include Cafeteria subsidies, union credit, house
financing etc.
• Other expenditure: - Like holiday bonus, on educational reimbursements, employee
uniforms, work cloths, supper money or meal allowance etc.

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EMPLOYEE SERVICES: .

In addition to the benefits, organizations also provide a wealth of services that employees find
desirable. These services are usually provided by the organization at no cost to employee or at a
significant reduction from what might have to be paid without the organization’s support.

The employee services include:

• Services related to the types of work performed

This including subsidies for purchase and upkeep of work, clothing and uniforms and of
various types of tools, used by a worker in the course of his work;

• Eating facilities: - Which include the provision of company restaurants, cafeterias,

canteens, lunchrooms etc.
• Transportation facilities: - Like parking lot and bus services
• Child Care facilities: - Comprising nurses and day care centers for children
• Housing Services: - It includes company owned housing projects and subsidies.

• Financial and legal services: - This includes sponsoring of loan funds, credit unions,
income tax services, saving plans and group insurance plans.

20
 • Purchasing Services: - This includes company operated stores and discount on company
products and services.
• Education Services: - Which include sponsorship for off duty courses, educational
leave, tuition fee, refunds and scholarship for employees and their children.
• Medical Services: - Including plant infirmaries, (clinics and hospitals, counseling and
referrals to community to social services.)
• Outplacement Services: - This include, contact with other employers in the area, help in
writing up resumes and secretarial services.
• Flexi time: - The employees are permitted to build up their flexible workday: It is called
flexi time because the workers themselves determine their own starting and stopping
time.

INDUSTRIAL RELATIONS

Acc. To. J. Henry Richardson“Industrial relations is an art, the art of living together for purposes
of production. The parties whileworking together learn this art by acquiring the skills of
adjustment.”
Features of Industrial Relations

1) Industrial relations are born out of employment relationship in an industrial setting. Without
the existence of two parties i.e. labour and management, this relationship cannot exist. It is the
industry, which provides the environment for industrial relations

(II) Industrial relations are characterized by both conflict and co-operation

. So the focus of industrial relations is on the study of the attitudes, relationships, practices and
procedures developed by the contending parties to resolve or at least minimise conflicts.

III) As the labour and management do not operate in isolation but are a part of the large system, so the
study of industrial relations also includes vital environmental issues like technology of the
workplace, country's socio-economic and political environment, nation's labour policy, attitude of
trade unions, workers and employers.

(IV) Industrial relations also involve the study of conditions conducive to the labour,
management co-operation as well as the practices and procedures required to elicit the desired
co-operation from both the parties.

(V) Industrial relations also study the laws, rules, regulations, agreements, awards of court, customs and
traditions, as well as policy framework laid down by the government for eliciting co-operation between
labour and management. Besides this, it makes an in-depth analysis of the intervening patterns of the
executive and judiciary in the regulation of labour-management relations.

scope of Industrial Relations. The scope can be studied under three main categories. These categories
are:

• Promotion and development of healthy labour-management relations

• Maintenance of industrial peace and avoidance of industrial strife and

21
 • Development of industrial democracy.

human rights………….

(b) Recognition of Human Rights in Industry: This implies that labour is not a commodity of
commerce, which can be purchased and disposed of at the whims and fancies of employers. The
workers are to be treated as human beings whose sense of self-respect is to be fostered. Their urge
for self-expression (through closer association with management) should be satisfied. These are
the basic prerequisites for achieving industrial democracy.
(c) Increase in Labour Productivity: The factors that contribute to higher productivity of labour are:

Improvement in:

• Level of efforts and skills of workers

• Production process,
• Materials,
• Equipment,
• Layout,
Contemporary issues in Industrial Relations:

(i) Low Wages

(ii) Employment of Women

(iii) Ignorance and illiteracy

(iv) Industrial Housing

(v) Child Labour.

Industrial disputes

"Any disputes or differences between employers and employers, or between employers and
workmen, or between workmen and workmen, which is connected with the employment or non-
employment or the terms of employment or with the conditions of labour, of any person."

Let us understand that the definition identifies three parties to disputes. They are:

(i) Employers and Employers

(ii) Employers and Workmen

(iii) Workmen and Workmen

Weapons used by labour during times of industrial disputes.

1) Strike. When workers collectively cease to work in an industry, it is known as strike. Strike
can be defined according to the Industrial Disputes Act, 1947 as:

22
 "It means a cessation of work by a body of persons employed in an industry acting in
combination; or a concerted refusal of any number of persons who are or have been so
employed to continue to work or to accept employment; or a refusal under a common
understanding of any number of such persons to continue to work or to accept
employment".

Strikes can be divided into two categories. They are:

• Primary strikes
• Secondary strikes
The primary strikes are:

(i) Economic Strike. Most of the strikes of workers are for more facilities and increase in wage
levels. In economic strike, the labourers demand increase in wages, travelling allowance, house
rent allowance, dearness allowance and other facilities such as increase in privilege leave and
casual leave.

(ii) General Strike. It means a strike by members of all or most of the unions in a region or an
industry. It may be a strike of all the workers in a particular region of industry to force demands
common to all the workers. It may also be an extension of the sympathetic strike to express
generalised protest by the workers.

(iii) Stay-in Strike. In this case, workers do not absent themselves from their place of work
when they are on strike. They keep control over production facilities. But do not work. Such a
strike is also known as 'pen down' or 'tool down' strike.

(iv) Slow Down Strike. Employees remain on their jobs under this type of strike. They do not
stop work, but restrict the rate of output in an organised manner. They adopt go-slow tactics to
put pressure on the employers.

These are some of the primary strikes. A few more will come up in the diagram that we will
be discussing shortly.

The secondary strike is:

(1) Sympathetic Strike. When workers of one unit or industry go on strike in sympathy with
workers of another unit or industry who are already on strike, it is called a sympathetic
strike. The workers of sugar industry may go on strike in sympathy with their fellow
workers of the textile industry who may already be on strike.

(2) Boycott. The workers may decide to boycott the company in two ways. Firstly by not using
its products and secondly by making an appeal to the public in general. In the former case, the
boycott is known as primary and in the latter secondary If is a coercive method whereby the
management is forced to accept their demands.

(3) Picketing. When workers are dissuaded from work by stationing certain men at the factory
gates, such a tep is known as picketing. If picketing does not involve any violence, it is perfectly
legal.

23
(4) Gherao. Gherao in Hindi means to surround. The workers may gherao the members of the
management by blocking their exits and forcing them to stay inside their cabins. The main object
of gherao is to inflict-physical and mental torture to the person being gheraoed and hence this
weapon disturbs me industrial peace to a great extent.
Some of the weapons used by the management are:
1. Employers' Association. The employers may form their unions to collectively oppose the
working class and put pressure on the trade unions.
2. Lock-out. An employer may close down the place of employment temporarily. Such a step is
technically known as lock -out. It is the reverse of a strike and is a very powerful weapon in the
hands of an employer to pressurise the workers to return to the place of work.

According to the Industrial Disputes Act, 1947, "lock-out means the closing of a place of
employment or the suspension of work, or the refusal by an employer to continue to employ any
number of persons employed by him.

3. Termination of Service. The employers may terminate the services of those workers who
are on strike by blacklisting them. Their lists may be circulated to other employers so as to
restrict their chances of getting employment with those employers

24
 Cause of Industrial Disputes:

1. Economic Cause: These causes may be classified as:

o Demand for increase in wages on account of increase in all-India Consumer Price Index
for Industrial Workers.
o Demand for higher gratuity and other retirement benefits.
o Demand for higher bonus.
o Demand for certain allowances such as:
o House rent allowance
o Medical allowance
o Night shift allowance
o Conveyance allowance
o Demand for paid holidays.
o Reduction of working hours.
o Better working conditions, etc.
2. Political Causes: Various political parties control Trade unions in India. In many cases, their leadership
vests in the hands of persons who are more interested in achieving their political interests rather than the
interests of the workers.
3. Personnel Causes: Sometimes, industrial disputes arise because of personnel problems like dismissal,
retrenchment, layoff, transfer, promotion, etc.
4. lndiscipline: Industrial disputes also take place because of indiscipline and violence on the part of the
workforce. The managements to curb indiscipline and violence resort to lock -outs

5. Misc. causes: Some of the other causes of industrial disputes can be:
o Workers' resistance to rationalisation introduction of new machinery and change of place
o Non- recognition of trade union
o Rumours spread out by undesirable elements
o Working conditions and working methods
o Lack of proper communication
o Behaviour of supervisors
o Inter trade union Rivalry etc.

Measures to improve industrial Relations:

(i) Progressive Management Outlook
(ii) Strong and Stable Union
(iii) Atmosphere of Mutual
Trust.
(iv) Mutual Accommodation
(v) Sincere
Implementation of Agreements.
(vi) Workers’ Participation in Management
(vii) Sound Personnel Policies
(viii) Government’s Role.
Dispute Resolution
Topics to be covered:
• Industrial Relations machinery
• Preventive machinery
• Settlement machinery

25
INDUSTRIAL RELATIONS MACHINERY

Prevention of industrial disputes:

The preventive machinery has been set up with a view to creating harmonious relations between
labour and management so that disputes do not arise. It comprises the following measures:
a) Schemes of workers’ participation in management such as works committees, joint
management councils and shop councils and joint councils.
b) Collective bargaining.
c) Tripartite bodies
d) Code of discipline.
e) Standing orders.
Tripartite Bodies

Industrial relations in India have been shaped largely by principles and policies evolved through tripartite
consultative machinery at industry and national levels. The aim of the consultative machinery is “to bring
the parties together for mutual settlement of differences in a spirit of cooperation an goodwill”
• Code of Discipline

The Code of Discipline is a set of self-imposed mutually agreed voluntary principles of discipline and
relations between the management and workers in the industry. Standing Orders

The purpose of having Standing Orders at the plant level is to regulate industrial relations. They define
with sufficient precision the conditions of employment under the employers and hold them liable to make
the said conditions known to workmen employed by them. These orders regulate the

following:

• Conditions of employment
• Discharge
• Grievances
• Misconduct
• Disciplinary action etc.

SETTLEMENT OF INDUSTRIAL DISPUTES

(JUDICIAL MACHINERY)

The machinery for the settlement of industrial disputes has been provided under the Industrial Disputes
Act, 1947.

This machinery comprises:

(a) Conciliation,
(b) Arbitration, and
(c) Adjudication.

Conciliation
Conciliation or mediation signifies third party intervention in promoting the voluntary settlement of
disputes.

26
The conciliator assists the parties to dispute in their negotiations by removing bottlenecks in
communication between them. Conciliation machinery as provided under the Industrial Disputes Act,
1947is as under:

I. Conciliation Officers. The Act provides for the appointment of conciliation officers, permanently
or for a limited period, for specific area or for a specific industry, to whom the industrial disputes
shall be referred for conciliation. The conciliation officer enjoys the powers of a civil court; he can
call and witness parties on oath. The conciliation officer examines all facts relevant to the disputed
matter and then gives his judgment.
II. Board of Conciliation. The Act also empowers the Government to appoint a Board of
Conciliation for promoting the settlement of disputes where the Conciliation Officer fails to do so
within 14 days. The Conciliation Board is a tripartite adhoc body consisting of a chairman and two
to four other members nominated by the parties to the dispute. The mode and procedure of the
functioning of the Board are similar to those of the Conciliation Officer.
III. Court of Inquiry. In case the conciliation proceedings fail to settle an industrial dispute, the
Government has yet another option of referring the disputed to the Court of Inquiry. The Court is
expected to give its report within six months. The performance of conciliation machinery cannot be
said to be satisfactory. Only 25% of cases are annually handled. Besides a very large number of
disputes are filed and then withdrawn later on by workers or unions. It means petty issues are taken
up for conciliation. Finally, a substantial number of cases remain pending

• Arbitration

Voluntary arbitration became popular as a method of settling difference between workers and
management with the advocacy Mahatma Gandhi, who had applied it very successfully in the Textile
industry of Ahmedabad. However, voluntary arbitration was lent legal identity only in 1956 when
Industrial Disputes Act, 1947 was amended to include a provision relating to it.

National Commission on Labour (1969) identified following causes for the failure of voluntary
arbitration:

1. Lack of arbitrators who command the confidence of the parties to the disputes.
2. Law provides no appeal against the award given by arbitrator
3. Easy availability of adjudication on the failure of negotiation or conciliation.
4. The absence of simplified procedure to followed in voluntary arbitration.
• Adjudication

The ultimate remedy for the settlement of an unresolved dispute is its reference by the
Government to adjudication.

Adjudication may be described as process which involves intervention in the dispute by a third
party appointed by the government, with or without the consent of the parties to the dispute, for
the purpose of settling the dispute.

The Industrial Disputes Act, 1947 provides a three-tier adjudication machinery comprising

(i) Labour Courts,

(ii) Industrial Tribunals, and

27
 (iii) National Tribunals

(i) Labour Courts. The Labour Courts can deal with disputes relating to:
a) The propriety or legality of an order passed by an employer under the standing
Orders.
b) The application and interpretation of Standing Orders.
c) Discharge and dismissal of workmen and grant of relief to them.
d) Withdrawal of any statutory concession or privilege.
e) Illegality or otherwise of any strike or lock-out
f) All matters not specified in the third schedule of Industrial Disputes Act, 1947, (it
deals with the jurisdiction of Industrial Tribunals).
1. Wages including the period and mode of payment.
2. Compensatory and other allowances.
3. Hours of work and rest intervals
4. Leave with wages and holidays
5. Bonus, profit sharing, provident fund and gratuity.
6. Shift working otherwise than in accordance with standing orders.
7. Rules of discipline
8. Rationalisation
9. Retrenchment.
10. Any other matter that may be prescribed.
(ii) Industrial Tribunals. The Industrial Tribunals can deal with the following matters
(iii) National Tribunals. These tribunals are meant for those disputes which, as the name
suggest, involve the questions of national importance or issues which are likely to affect
the industrial establishments of more than one state, The employers and unions use
adjudication as a primary measure of resolving disputes. About 90 to 95 per cent of
disputes are referred to adjudication machinery on an average annually.

Disputes that do arise can be resolved in any of the following ways:

1. One or more parties agree to accept a situation in which their interests are not fully satisfied.
2. The parties submit the situation to an impartial person or panel, who decides which interests
should be satisfied and which should not. Usually, the impartial person or panel will refer to pre-
existing rules or guidelines that had been agreed by all parties or were at least known to all
parties. Often these rules are what we call laws.
3. The perceptions of one or more parties change, so that there is no longer a perceived difference
in interests.
4. The interests of one or more parties change, so that there is no longer a difference in interests.
The Three Factors
At this point, it is useful to recognize that there are three independent fundamental factors that affect the
resolution of disputes:

28
Interests:
Are defined by a party in an interaction and are the things that that party is interested in (money,
recognition, physical goods, or whatever).
Power:
Is given by a combination of external circumstances and self-confidence.
Rights:
Are given by an external framework, for example national laws or contracts between parties.
When a party has a common interest with another party, and power, and rights, it is in a very favorable
situation. For example, Hewlett-Packard (HP) shares with its customers the interest in producing and
selling high-quality, low-cost printers; HP has the financial power to develop printers and the marketing
power to distribute them; HP has the rights to patents and trade secrets that allow it to produce the best
products.
More commonly, one of the elements is missing. For example, in the laserjet printer market, Canon has
the same interests as HP and its customers, many of the same rights as HP to the patents on the
technology, but it lacks the marketing power.
Rights may confer power: for example, a patent confers the power to prevent competitors from creating a
given product. But power may be required to exercise a right: for example, financial power is required to
litigate a patent-infringement suit against a large company.
Either rights or power may be ceded in order to satisfy an interest; conversely, to satisfy an interest may
require ceding rights or power: for example, authors whose interests are financial rewards typically cede
their copyright rights to a publisher.

Thus there are connections between interests, power, and rights, and in real life there are usually trade-
offs between the three factors.

Methods of Dispute Resolution

Negotiation:

Is a method of dispute resolution largely based on power; it often results in solutions of type A
above.

Arbitration and Litigation:

Are methods largely based on rights; they result in solutions of type B above. The advantage of
arbitration is that parties can select the judges and, to some extent, the rules to be used. For more

29
 information, see Constituting Arbitral Tribunals, International Commercial Arbitration Primer,
and Dispute Resolution in Telecommunications.

Non-binding arbitration:

is a way of obtaining impartial information regarding a situation; it often results in solutions of

type C above.
Mediation:

Is a way of finding out if parties' interests can be broadened so that a true common ground can be
found; it often results in solutions of type D above.

Seemingly simple disputes can become very acrimonious and hard to resolve when parties focus on
power or rights; an important component in the process of mediation consists in reminding parties that
interests should always play a significant role in dispute resolution, and in helping the parties to find
common interests. For more information see Non-Adversarial Mediation and Mediation and Lean
Arbitration.

30
 STRESS MANAGEMENT
The nature of stress has been studied by scholars in a wide range of academic disciplines. Physicians,
psychiatrists, and researchers in management have all studied its causes and its symptoms, and have
defined the term in a variety of different ways. Stress is defined as "the reactions of individuals to new or
threatening factors in their work environments”.
Stress can be either positive or negative. Some new work situations can bring us positive
challenges and excitement. For example, promotions to new jobs present employees with positive stress.
Employees may feel anxious about their new work assignments; they also anticipate them eagerly and
look forward to the additional challenges, rewards, and excitement. In these cases, the new and uncertain
job situations create positive stress. The positive stress is also called the eustress. However, there are
certain other types of work that are very threatening and anxiety-arousing. For example, depression in the
economy can create negative stress for sales personnel, because they will be much more anxious about
making sales commissions and sales quotas.
For every individual there is an optimum level of stress under which he or she may perform to
full capacity. If the stress experienced is below this optimum level, then the individual gets bored, the
motivational level to work reaches a low, point, and apathy sets in. If one operates in a very low stress
environment and constantly experiences boredom, the person is likely to psychologically or physically
withdraw from work. Psychological withdrawal will result in careless mistakes being frequently made,
forgetting to do things, and thinking of things other than work during work hours. Physical withdrawal
will manifest itself in increased rates of tardiness and absenteeism, which may ultimately lead to
turnover. Though the optimum stress level is different Form different individuals, each individual can
sense and determine how much stress is functional for an individual to operate in a productive manner.
Research indicates that those who possess high tolerance of ambiguity, internal locus of control
and self-esteem seem to effectively handle a high level of stress. An individual possessing high degree of
tolerance for ambiguity allows him to experience very little anguish while operating under conditions of
insufficient information or in an uncertain environment. People with an internal locus of control also
handle stress well since they feel they are in control of the situation, rather than feeling controlled by the
situation they are facing. This makes it possible for them to manage their environmental stress without
experiencing its harmful effects. Those with high self-esteem also handle stress with ease since a high
self-esteem increases the confidence and enables them to deal with stressful situations with calmness and
clear thinking. The more successfully one handles a stressful situation without panicking or getting
overwhelmed by it, the more confidently will the individual face further stressful situations. Thus, it is
possible to raise one’s capacity to handle in different situations.

SOURCES OF STRESS
Stress is a reality of our everyday life. There are both positive and negative stresses that come from our
work and non-work lives. As pointed out by Near. Rice, and Hunt (1980) and Sckaran (1986), among
others, the work and non-work domains of one's life are closely interrelated. The stresses and strains
experienced in one domain are carried over to the other. Thus, if one experiences stress at work, that
stress will be carried over to the home.
One major source of job stress is the job itself. The way the job is designed, the amount of time
pressure an individual faces and the amount of expectations others have of a person at work can all lead to
job stress. Interpersonal relationships are a second source of job stress. How much contact an individual
has with coworkers and managers, how much time he or she deals with clients or consumers, and how
pleasant those interactions are all influences of how much stress an individual experiences at work. Third
source is problems in personal lives, which can spill over into the work environment, adding further
tension to an already stressful work situation.

SOURCES OF JOB STRESS

 Job Characteristics
o Role ambiguity

31
 o Role conflict
o Role overload o Ethical dilemmas
 Interpersonal Relationships
o Amount of contact with others
o Dealing with people in other departments
o Organizational climate
 Organizational Factors
 Personal Factors
o Career concerns
o Geographical mobility
o Rate of life change

Job Characteristics
A major source of job stress is a person's role in the organization. A role is simply the set of expectations
that other people in the organization have for an individual, For example, supervisors, coworkers,
customers and suppliers expect an employee to behave in certain predictable ways. The expectations
others have of an employee arc sometimes unclear, in conflict, or too high for the employee to meet
within the time allotted, and he or she experiences stress.
 Role Ambiguity: When there is a lot of uncertainty surrounding job definitions or job
expectations, people experience role ambiguity. With the recent increase in mergers and
acquisitions among major organizations, more and more employees arc experiencing job stress as
a result of role ambiguity. Role ambiguity is anxiety arousing among employees that leads to job
stress.
 Role Conflict: Often employees discover that different groups of people in an organization have
widely varying expectations of them, and that they cannot meet all those expectations. This
inconsistency of expectations associated with a role is called role conflict, which results in stress.
 Role Overload: Role overload is a situation in which employees feel they are being asked to do
more than time or ability permits. Working under time pressure is especially stressful.
 Role Underload: Role Underload is the condition in which employees have too little work to do
or too little variety -in their work. For example, salespeople in a store with no customer, standing
around all day with nothing to do, could be said to experience role underload. Ironically, role
underload leads to low self-esteem, increased frequency of nervous symptoms and increased
health problems.
 Ethical Dilemmas: Ethical dilemmas such as whether or not one should report the observed
unethical behaviors of another person can cause extreme levels of stress in individuals. This will
be especially true for those who have strong moral values of right and wrong and a deep sense of
personal and corporate social responsibility. Tensions arise because one might have to contend
against one's own colleagues who might be close friends, and may fear of reprisal and other
undesirable consequences.

Interpersonal Relationships
Another major source of stress in organization is poor interpersonal relationships with supervisors,
subordinates, coworkers. or clients. When interpersonal relationships at work are unpleasant, employees
develop a generalized anxiety, a diffuse feeling of dread about upcoming meetings and interactions. Three
aspects of interpersonal relationships at work, which have a negative impact on job stress, are as follows:
 Amount of contact with others: Jobs vary in terms of how much interpersonal contact is built
into them. Too much prolonged contact with other people can cause stress.
 Amount of contact with people in other departments: Having contacts with people outside one's
own department creates a special sort of stress. People in other departments do not always have
an adequate understanding of jobs outside their own areas, which can cause stress.

32
  Organizational climate: The overall psychological climate of the organization can create stress.
When day-to-day life in an organization is marked by unfriendly, distant, or hostile exchanges,
employees are continually tense and this causes stress.

Organizational Factors
Following are the organizational factors that cause stress in individuals:
 Work environment factors such as noise, heal, poor lighting, radiation and smoke are stress-
inducing agents.
 Insufficient resources such as time, budget, raw materials, space or manpower also induce stress
in the work environment. When one has to produce and perform with inadequate resources on a
long-term basis, this naturally imposes stresses and strains on the individuals who are responsible
for getting the job done.
 Structural factors in the organizational setting such as staff rules and' regulations and reward
systems, may cause stress.
 Lack of career promotion in organizations may be sometime cause stress.
 Environmental factors of stress include sudden and unanticipated changes in the marketplace,
technology, the financial market and so on.

Personal Factors
Employees’ personal lives have a marked effect on their lives at work. If things are going well personally,
they are more likely to be upbeat and optimistic. They have more energy and patience for dealing with
problems at work. On the other hand, if employees are having some personal problems, they might be
more tense or distracted when they go to work.
Factors that influence how much stress people bring from their persona! lives to the work setting
are as follows:
 Career Concerns: One major career concern that can cause stress is lack of job security. A
second career concern that can cause employees stress is status incongruity, i.e., having jobs with
less status, power and prestige than they think they deserve.
 Geographical Mobility: Geographical moves create stress because they disrupt the routines of
daily life. When geographical moves arc undertaken as part of a job transfer, the moves can be
even more stressful. The transferred employees are likely to feel out of control at work, too, and
experience their new work environments as unpredictable.

EFFECTS OR CONSEQUENCES OF JOB STRESS

Negative stress has unpleasant consequences for them, their families and for the organizations they serve.
Effects on the Individual
The impacts of distress on individuals are of following types:
 The subjective or intrapersonal effects of stress are feelings of anxiety, boredom, apathy,
nervousness, depression, fatigue, and anger. Sometimes experiencing the stress may cause aggressive
behaviors on the part of the individual.
 The cognitive effects include poor concentration, short attention span, mental blocks and inability to
make decisions.
 The physiological effects can be seen in increased heart and pulse rate, high blood pressure, dryness
of throat, and excessive sweating.
 The behavioral effects arc manifest in such things as accident proneness, drinking, excessive eating,
smoking, impulsive behaviors, depression, and withdrawal behaviors.
 The manifest health effects could be stomach disorders, asthma, eczema, and other psychosomatic
disorders. In addition, the mental health, i.e. the ability lo function effectively in one's daily life, will
also decline as excessive stress is experienced.

33
Consequences for the Family
Negative stress, which is handled by individuals in dysfunctional ways, such as drinking or withdrawal
behaviors, will have an adverse effect on their home life. Spouse abuse, child abuse, alienation from
family members, and even divorce could result from dysfunctional coping mechanisms.

Consequences to Organizations
The adverse consequences on an organization include low performance and productivity, high rates of
absenteeism and poor decision-making. It also leads to lost of customers because of poor worker attitudes,
increased alienation of the worker from the job, and even destructive and aggressive behaviors resulting
in strikes and sabotage. The stresses experienced by employees who take on critical roles and are
responsible for safety can sometimes be detrimental to the public. For instance, the stresses experienced
by a train driver or railway guard, or that of an airline pilot, navigator, or air traffic controller may result
in serious accidents. Needless to say that the costs of employee stress to the organization in terms of lost
profits, poor image and loss of future business are enormous.

METHODS OF MANAGING STRESS

Stress is a factor that everybody has to contend with on a daily basis both in the work and non-work
spheres of life. Since the body has only a limited capacity to respond to stress, it is important for
individuals to optimally manage their stress level to operate as fully functioning human beings.
There are several ways in which stress can be handled so that the dysfunctional consequences of
stress can be reduced. Some of them are:

Role Analysis Technique (RAT)

The Role Analysis Technique helps both the manager and the employee to analyze the requirements and
expectations from the job. Breaking-down the job into various components clarifies the role of the job for
the entire system. This also helps to eliminate reduction of work and thus lowering down the stress level.

Job Relocation
Job relocation assistance is offered to employees who are transferred, by finding alternative employment
for the spouses of the transferred employees and getting admissions in schools for their children in the
new place. These arrangements help to reduce the anxiety and stress for the moving family.

Recreational Program
Providing recreational facilities, arranging group meditation programs, help to reduce the stress levels of
the employees.

Employee Assistance Program

Another widely used strategy is the employee assistance Programs, which offer a variety of assistance to
employees. These include counseling employees who seek assistance on how to deal with alcohol and
drug abuse, handling conflicts at the work place, dealing with marital and other family problems.

Career Counseling
Career Counseling helps the employee to obtain professional advice regarding career that would help the
individual to achieve personal goals. It also makes the employees aware of what additional educational
qualifications or specialized technical training, if any, (hat they should acquire. By becoming
knowledgeable about the possible avenues for advancement, the employees who consider their careers to
be important can reduce their stress levels by becoming more realistic about their options and can start
preparing themselves for it.

Time Management

34
Another way of coping with stress is to manage time more effectively. People can learn to get better
organized so that they can do their work more efficiently.

Delegation
Another way of coping with job stress is to delegate some responsibilities to others. Delegation can
directly decrease workload upon the manager and helps to reduce the stress. !

More Information and Help

Some new employees have to spend more time on a job than necessary because they are not sure what
they are doing. So it is necessary that some help should be provided before doing the work that would
lead to much efficient, effective work. It would also reduce anxiety and stress among the employees.

Health Maintenance
Probably the most frequently used organizational stress management program is health maintenance.
Many companies invest large sum of money in gym and sport facilities for maintaining the health of the
employees.

Supervisor Training
Another type of stress management Program that organizations are experimenting with is supervisor
training. The emphasis on supervisory training Program is how to prevent job stress. Managers are trained
to give better performance appraisals, to listen to employees’ problems more effectively, and to
communicate job assignments and instructions more clearly.

Individual Stress Reduction Workshops

Some organizations have also sponsored individual stress reduction workshops for their employees. These
programs include biofeedback, meditation to career counseling, time management and interpersonal skills
workshops. In lectures and seminars, participants are given a basic understanding of the causes of stress
and its consequences. Then, participants are given materials to help them identify the major sources of
stress in their own lives, and some strategies for dealing with that stress more effectively.
What is Health?
Health at the individual employee level is not just the absence of illness but also includes positive
health or optimal functioning

Health at the organizational level now includes human resource factors such as turnover rates, the
number of grievances, and the overall morale of employees of the organization
External Environment
Four external factors affect the ways that organizations deal with health issues:
 Americans with Disabilities Act (ADA)
 Family and Medical Leave Act (FMLA)
 Rising health care insurance costs
 General workforce trends
Americans with Disabilities Act
The ADA was designed to promote the employment of individuals with disabilities
Disabilities are defined as impairments that limit one or more major life activities but do not prevent
individuals from performing the essential duties of the job

Family and Medical Leave Act (FMLA)

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  The Family and Medical Leave Act of 1993 requires employers to provide up to 12 weeks of
job-protected leave for employees who need it for family or medical crises
 The FMLA does not require paid leave by the company
 Rising Health Care Insurance Costs
 Per capita health care expenditures increased between 5% and 9% per year between 1993 and
2002
 Insurance companies provide incentives and support to reduce accidents and illnesses
General Workforce Trends
The workforce is becoming older, includes more women, and is ethnically and racially diverse
affecting internal health related issues
Internal Factors
Internal factors in health and safety include:
 Job stress
 Safety
 Diversity and discrimination
 Sexual harassment, violence, and incivility
Job Stress
A 2002 national survey found that half of all workers see job stress as a major problem, which is over
double the proportion who expressed this view just 10 years earlier
Job Role Stressors
 Role ambiguity - lack of clarity and specificity about one’s occupational role responsibilities
 Role conflict - the presence of competing or incompatible role demands
 Role overload - having too much work to do, too little time to do that work, and/or not having
the resources to complete the work required

Emerging Job Stressors

 Conflict between work and family roles
 Technological advances – may blur work and nonwork roles
 Increased service industry jobs may require more emotional regulation due to frequent
customer interaction

Safety
 The overall number of occupational injuries and days missed due to injuries has declined
between 1990 and 2005
 With the expansion of service-producing businesses, we have seen an increase in the number
of deaths in the retail and transportation industries
How to Improve Safety
 Safety climate - refers to the shared perceptions of an organization’s policies, practices, and
procedures with respect to the priority placed on safety
 Work design- creating physical barriers between employees and known hazards
 Technology
 Technology can lead to safety issues through:
o New machinery
o Extensive computer usage
Diversity and Discrimination
 Discrimination is associated with negative mental health outcomes
 Diversity can increase stress and make communication with coworkers more difficult

Sexual Harassment, Violence, and Incivility

 Increases in the service industry will increase the potential for aggression from customers
 Sexual harassment may lead to psychological distress and overall health issues

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  HR Responses
 Organizational health and safety interventions can be classified into two general categories:
o Initiatives that reduce and prevent strain and injury from occurring in the first place
o Initiatives that help to rehabilitate individuals who have already experienced strain and
injury

Preventative Interventions
 Primary interventions - aimed at reducing or eliminating the source of strain and risk in the
workplace and are targeted at everyone
 Secondary interventions - target individuals that are particularly at risk and help them to manage
the causes of stress, strain, and injury
 Compensation
 Financial incentives may promote safe behaviors as long as the incentive programs are aligned
with other organizational systems
 Employee Involvement and Job Enrichment
 Organizations can involve their employees in the development and implementation of policies
and practices related to occupational health and safety
 Diversity Training
 Diversity training can be integrated with other, more general training initiatives such as team
building, mentoring programs, and management training
 Work-Life Balance Initiatives
 Flexible work hours and childcare assistance
 Flexible leave options that go beyond the requirements of the FMLA
 Safety Management
 Ways to target and prevent injuries:
o Eliminate hazards entirely by redesigning jobs such that exposure to hazards is no longer
necessary
o Block access to hazards that the organization cannot eliminate
o Training employees to recognize hazards and avoid them
 Employee Assistance Programs
 Programs aimed at helping employees that are experiencing a range of personal concerns such as
stress, family difficulties, substance abuse, financial troubles, and legal problems
 Health Promotion
 Health promotion programs are aimed at increasing positive health behaviors such as exercise and
relaxation techniques, while decreasing negative health behaviors such as smoking or unhealthy
diets
Guidelines
 Conduct Health and Safety Audits
 Incorporate Health and Safety into Performance Appraisals
 Incorporate Health and Safety into Compensation Systems
 Guidelines Continued
 Integrate the Health and Safety Functions Within the Organization
 Monitor the External Environment for Health and Safety Issues
 Promote the Importance of Health and Safety
 Conclusion
 Environmental factors have increased the importance of health and safety in the workplace
 Organizations have responded with various initiatives
 Guidelines have been provided to promote health and safety in the workplace

Employee Health and Safety

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Employers are responsible for providing a safe and healthful workplace for their employees. The
Occupational Safety and Health Administration (OSHA), an agency of the U.S. Department of Labor, has
the responsibility of assuring the safety and health of America's workers by setting and enforcing
standards; providing training, outreach and education; establishing partnerships; and encouraging
continual improvement in workplace safety and health.
Twenty-four states, Puerto Rico and the Virgin Islands operate their own OSHA-approved safety and
health programs under Section 18 of the Act. While the programs in these states may differ in some
respects from Federal OSHA, the standards imposed by State Plan States must be at least as effective as
Federal OSHA standards. A list of states that operate their own safety and health programs can be found
on OSHA's website.
Safety and Health Add Value

Addressing safety and health issues in the workplace saves the employer money and adds value to the
business. Recent estimates place the business costs associated with occupational injuries at close to $170
billion - expenditures that come straight out of company profits.
When workers stay whole and healthy, the direct cost-savings to businesses include:
 lower workers' compensation insurance costs;
 reduced medical expenditures;
 smaller expenditures for return-to-work programs;
 fewer faulty products;
 lower costs for job accommodations for injured workers;
 less money spent for overtime benefits.
Safety and health also make big reductions in indirect costs, due to:
 increased productivity;
 higher quality products;
 increased morale;
 better labor/management relations;
 reduced turnover;
 better use of human resources.
Employees and their families benefit from safety and health because:
 their incomes are protected;
 their family lives are not hampered by injury;
 they have less stress.
Simply put, protecting people on the job is in everyone's best interest - our economy, our communities,
our fellow workers and our families. Safety and health add value to businesses, workplaces and lives.
Developing a profitable strategy for handling occupational safety and health

Nobody wants accidents to happen in his or her business. A serious fire, a permanent injury, or the death
of an employee or owner can cause the loss of profit or even an entire business. To prevent such losses,
you don't have to turn your business upside down. You may not have to spend a lot of money, either. You
do need to use good business sense and apply recognized prevention principles.
There are reasons why accidents happen. Something goes wrong somewhere. It may take some thought,
and maybe the help of friends or other trained people, to figure out what went wrong, but an accident
always has a cause - a reason why. Once you know why an accident happened, it is possible to prevent
future incidents. You need some basic facts and perhaps some help from others who already know some
of the answers. You also need a plan to prevent accidents.
Not all dangers at your worksite depend on an accident to cause harm, of course. Worker exposure to
toxic chemicals or harmful levels of noise or radiation may happen in conjunction with routine work as
well as by accident. You may not realize the extent of the exposure or harm that you and your employees
face. The effect may not be immediate. You need a plan that includes prevention of these health hazard
exposures and accidents. You need a safety and health management system.

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It is not difficult to develop such a plan. Basically, your plan should address the types of accidents and
health hazard exposures that could happen in your workplace. Because each workplace is different, your
program should address your specific needs and requirements.

There are four basic elements to all good safety and health programs. These are as follows:

1. Management Commitment and Employee Involvement: The manager or management team leads
the way, by setting policy, assigning and supporting responsibility, setting an example and
involving employees.
2. Worksite Analysis: The worksite is continually analyzed to identify all existing and potential
hazards.
3. Hazard Prevention and Control: Methods to prevent or control existing or potential hazards are
put in place and maintained.
4. Training for Employees, Supervisors and Managers: Managers, supervisors and employees are
trained to understand and deal with worksite hazards.

Regardless of the size of your business, you should use each of these elements to prevent workplace
accidents and possible injuries and illnesses.

The Four-Point Workplace Program is based upon the Safety and Health Program Management
Guidelines issued by OSHA in January 1989. Although voluntary, these guidelines represent OSHA's
policy on what every worksite should have in place to protect workers from occupational hazards. The
guidelines are based heavily on OSHA's experience with its Voluntary Protection Programs (VPP), which
recognize excellence in workplace safety and health management.

CONCEPT OF LABOURWELFARE FUND:

_ The concept of Labour Welfare Fund has been evolved in order to extend a measure of social assistance
to workers in the unorganized sector. Towards this end, separate legislations have been enacted by
Parliament to set up five Welfare Funds to be administered by Ministry of Labour to provide housing,
medical care,educational and recreational facilities to workers employed in beedi industry,certain non-
coal mines and cine workers.Efforts are afoot to substantially expand the Welfare Fund approach to cover
more categories & sub-categories of workers in the unorganized sector such as tendu patta pluckers, fish
processing industry workers and salt industry workers ._ The scheme of Welfare Funds is outside the
framework of specific employer and employee relationship in as much as the resources are raised by the
Government on a non-contributory basis and Einstein College of Engineering

delivery of welfare services effected without linkage to individual worker’s contribution. This approach
has been adopted by some State Governments also as in Gujrat,Orrisa,Madhya Pradesh, Maharashtra, Goa
and Kerala etc. Welfare funds which follow a sectorial approach are in addition to a large number of
various other poverty alleviation and employment generation programmes,which follow a regional
approach and for which most of these workers are eligible.

SOCIAL SECURITY: GROUP INSURANCE SCHEMES FOR BEEDI AND CINE WORKERS: Group
Insurance Schemes for beedi and cine workers came into force w.e.f. 1.4.1992 and 1.4.197 respectively.
These are managed by LIC on no profit no loss basis. The beedi and cine workers between the age group
of 18 to 60 years and those who have been issued genuine Identity Cards up to end of the preceding
financial year by the following authorities have been covered under the purview of this Scheme :
(i) by employers;
(ii) by executive authorities of local bodies;

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 (iii) by authorities implementing Beedi &Cigar Workers (Conditions of Employment)
Act, 1966; /Cine Workers Welfare Fund Act, 1981; and 59
(iv) by Officers of the Labour Welfare Organization.However, those Identity Cards
holders who are enrolled as subscribers by the Employee's Provident Fund
Organization are not covered under these Schemes.The premium is charged at the
rate of Rs.18/-and Rs.30/- for beedi and cine workers respectively, per annum per
member. While for beedi workers, premium is shared by Labour Welfare
Organization and Social Security Fund of India on 50--50 basis, for cine workers, full
premium is paid by Labour Welfare Organization._ The claim amount is Rs.3,000
and Rs.5,000/ - for natural death and Rs.25,000/- and Rs.10,000/- in case of
accidental death, for beedi and cine workers respectively, subject to the provisions of
the Schemes._ The attempts are afoot to improve delivery of these Group Insurance
Schemes.

SOCIAL SECUIRTY UNDER MINE WORKERS WELFARE FUND An amount of Rs.1500/- is

admissible in case of permanent incapacitation of mine workers. Besides, a sum of Rs.450/- per month for
5 years is also admissible to his widow. In addition to this scholarship of Rs 100 to each of the school
going child till the age of 21 or his/her marriage,whichever is earlier. LABOUR WELFARE FUNDS: The
Ministry of Labour is administering five Welfare Funds for beedi, cine and certain categories of non-coal
mine workers. The Funds have been set up under the following Acts of Parliament for the welfare of these
workers. The Mica Mines Labour Welfare Fund Act,1946; The Limestone and Dolomite Mines Labour
Welfare Fund Act, 1972 The Iron Ore, Manganese Ore and Chrome Ore Mines Labour Welfare Fund Act,
1976; The Beedi Workers' Welfare Fund Act,1976; and The Cine Workers' Welfare Fund Act, 1981The
above Acts provide that the Fund may be applied by the Central Government to meet the expenditure
incurred in connection with measures and facilities which are necessary to provide the welfare of such
workers and in particular: to defray the cost of measures for benefit of such persons, directed towards the
provision/and improvement of the public health and sanitation, medical facilities and the prevention of
disaster supply and facilities for washing; educational facilities; housing and recreational facilities
including standards of living, nutrition and amelioration of social conditions; family welfare, including
family planning education and services; transportation to and from place of work (for mine workers only);
and such other welfare measures and facilities as may be prescribed; to grant loan or subsidy to a State
Government, a local authority or an employer, in aid of any scheme approved by the Central Government
for the purpose connected with the welfare of workers Einstein College of Engineering engaged in
beedi/cine/non-coal mine sector; to pay annual grants-in-aid to a State Government/local
authority/agency/owner of a mine which satisfies the prescribed criteria or to an employer who provides
to the satisfaction of the Central Government welfare measures and facilities of the prescribed standard
for the benefit of workers engaged in Beedi/Cine and non-Coal Mine sector; to meet the allowances of the
members to the State Advisory Committees and the Central Advisory Committee; any other expenditure
which the Central Government may direct to be defrayed from the Fund. In order to give effect to the
above objectives laid down in the above Acts, various welfare schemes have been formulated and are
under operation in the fields of: _ Health _ Social Security _ Education _ Housing _ Recreation _ Water
Supply _ The Labour Welfare Organization which administers these Funds is headed by a Director
General (Labour Welfare)/Joint Secretary. He is assisted by the Welfare Commissioner (Headquarters)of
Director rank, who supervises nine Regional Welfare Commissioners for the purpose of administration of
these Funds in the States.

ADVISORY COMMITTEES: To advise the Central Government on matters related to administration of

the above Funds, tripartite Central Advisory Committees have been set up under the respective Welfare
Fund Acts. These Committees are headed by Union Labour Minister. The C.A.Cs. have 18 members, 6
each from Central Government, Employers' Organizations, and Employees' Organization excluding the
Chairman and Secretary. State-wise tripartite Advisory Committees headed by the Labour Minister of the

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concerned State, have also been set up in the States of Andhra Pradesh, Bihar,Madhya Pradesh,
Rajasthan, Orissa, West Bengal, Karnataka, Kerala, Tamil Nadu,Gujarat and Maharashtra under the Beedi
Workers Welfare Fund . Under the Limestone & Dolomite Mines Labour Welfare Fund, SACs have been
constituted in the States of Uttar Pradesh,Madhya Pradesh, Bihar, Maharashtra,Karnataka, Gujarat, and
Orissa. Under Iron Ore, Manganese Ore & Chrome Ore Mines Labour Welfare Fund, State Advisory
Committees have been set up in the States of Madhya Pradesh, Bihar, Karnataka, Maharashtra, Goa, and
Andhra Pradesh._ Mica Mines Labour Welfare Fund has SACs in the States of Rajasthan, Bihar, and
Andhra Pradesh._ Cine Workers Welfare Fund has SACs in the States of Maharashtra, Andhra Pradesh,
Kerala, Tamil Nadu, Karnataka, and West Bengal.

MINE WORKERS: The eligibility ceiling of monthly income has been raised to Rs 10000 per month to
bring more workers in the net of welfare schemes. The need for this was being felt for quite some time as
most of the workers had gone out of the preview of the schemes on general increase of the wages in the
industry.

LABOUR WELFARE
The State Governments have to ensure the identifying and issuing of cards to beedi workers. LWO having
primary aim of running welfare schemes can supplement their efforts in limited manner only. The number
of identity cards issued by them in various States is given in . The Beedi Workers’ Welfare Fund
Rule,1978 have recently been amended to authorize Welfare Einstein College of Engineering
Commissioners/Assistant Welfare Commissioners and Welfare Administrators to file prosecution in
appropriate course against beedi manufacturers for violation of Rules which also includes issue of identity
cards by the employer. However the primary responsibility in this regard remains that of State
Governments who have extensive machinery by way of Labour Department to enforce the Beedi & Cigar
Workers (Conditions of Employment ) Act.1966.

ENHANCEMENT IN THE QUANTUM OF FINANCIAL ASSISTANCE: The Central Advisory

Committees on various Welfare Funds in their meetings held on 2.5.2000 have approved the proposals to
enhance quantum of financial assistance in various schemes covering various aspects in the areas of
health care, education, housing, and recreation. In most of the schemes, the quantum of financial
assistance has been doubled. In case of Integrated Housing Scheme, the amount has been enhanced from
Rs.9,000/- to Rs.20,000/- per dwelling unit. The financial assistance for treatment of diseases related to
heart and kidneys has been raised to Rs.1.00 lakh each from the present amount of Rs.10,000/- and
Rs.15,000/-, respectively.

FINANCIAL ASSISTANCE FOR HOUSING FACILITIES Shelter has been recognized as one of the
necessities for protection of all living beings from the vagaries of nature. Human habitation in a civilized
society perceives certain irreducible minimum standards of living.

INDUSTRIAL DISPUTE CAUSES: The most common causes of industrial disputes are economic
causes. These are follows: Demand for higher Wages: Rise in the cost of living forces the workers to
demand more wages to meet the rising cost of living index and to increase their standards of living. This
brings them into conflict with their employers who are never willing to pay more wages to workers.
Demand for Allowances and Bonus: Increase in cost of living was the main cause of the demand of
certain allowance allowances such as dearness allowance, house allowance, medical allowance, night
shift allowance, conveyance allowance etc; by the workers to equate their wages with the rise of prices.
Bonus also plays an important role as a cause of industrial dispute. Both the amount and the method of
bonus payment have led to a number of disputes. High Industrial Profits: In the changing world, concept
of labour has changed considerably. At the present, employers consider themselves as a partner of the
industry and demand their share in the profits. Non- Economic Causes:

41
Working Conditions and Working Hours: The working conditions
 in Indian industries are not hygienic. There is not ample provision of water, heating, lighting, safety
etc. On the other hand, working hours are also greater. The demand of palatable working conditions and
shorter hours of work led to labour disputes Modernization and Automation of Plant and

 Machinery: The attempt at modernization and Einstein College of Engineering introduction of

automatic machinery to replace labour has been the major cause of disputes of India. Workers go on
strike, off and on, to resist such rationalization.

Personnel Causes:
 Sometime industrial disputes arise because of personnel problems like dismissal, retrenchment, layoff,
transfer, and promotion etc. Political Causes:

 Various political parties control trade unions in India. In many cases, their leadership vests in hands of
persons who are more interested in achieving their political interests rather than the interests of the
workers.

 Indiscipline: Industrial disputes also take place because of indiscipline and violation on part of the
workforce. The managements to curb indiscipline and violence resort to lockouts Non-reorganization of
trade unions:

The  employers usually do not like the interference by trade unions. They do not recognize them. This
brings the workers into conflict with their employers. Weakness of Trade Unions: Weaknesses of trade
unions encourages
the employers to deny certain basic needs of the workers such as medical, education and housing
facilities etc. This led to resentment on the part of workers who resorted to direct action. Miscellaneous
causes: Behaviour
of supervisors, Lack of proper communication between management and workers, Rumors spread out
by trade union, Inter-trade union rivalry etc; are the other causes that cause dispute between management
and employers.

Causes of Industrial Accidents Definition:

an accident, often causing serious injury, that is job-related in that it usually happens on a work site
such as a factory floor or a construction site
There are a just as many causes of industrial accidents as there are types of industrial accidents. The broad
category of industrial accidents covers anything from small cuts and bruises to huge disasters that affect a
large population of people. Approximately 120 million industrial accidents occur in the work place world
wide each year. Approximately 210,000 of these accidents result in fatality. The industries which have the
highest rate of accidents are the mining, construction, transportation, and agricultural industries.
Construction accidents account for fifteen percent of all accidents and thirty percent of all fatalities in
industrial work environments.

Causes of industrial accidents can be broken down into two broad categories: unsafe conditions and
unsafe acts. The causes of industrial accidents that pertain to unsafe conditions can include insufficient
workspace lighting, excessive noise, slippery or unsafe flooring, extreme temperature exposure,
inadequate protection when working with machinery or hazardous materials, unstable structures,
electrical problems, machine malfunction or failure, and more. The causes of industrial accidents that
involve unsafe acts can include actions or failures to act which result in injury. This can be a result of
employee negligence but employers, organizations, and product manufacturers can also be liable for the
causes of industrial accidents. The causes of industrial accidents can occur in the environment around the
workplace or within the work environment. External causes of industrial accidents may include fires,

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chemical spills, toxic gas emission or radiation. The causes of industrial accidents in these cases might
include organizational errors, human factors, abnormal operational conditions, natural forces, software or
component failures, and outside interference. Internal causes of industrial accidents can involve
equipment or other work related tangibles, harmful materials, toxic chemicals, and human error. There are
several ways that a worker can be injured in the work environment. Injuries that result from the causes of
industrial accidents can include any one or combination of the following occurrences: falls, being struck
by objects in motion, slides and cave ins, structure collapse, being trapped in or by an object, overexertion
or strenuous physical actions, exposure to temperature extremes, electrical accidents, radiation exposure,
and the inhalation, ingestion, or absorption of harmful substances. These industrial accidents can result in
a number of injuries including superficial injury, fractures, sprains and strains, amputation, concussion,
internal injury, poisoning, infection, and death. The causes of industrial accidents are numerous. There are
several cases where employee negligence is a factor in industrial accidents. As a general rule, worker''s
compensation laws protect employers from lawsuits brought by injured employees. There are cases where
an employer can be held liable for worker injuries if they had knowledge of unsafe conditions and failed
to act in order to prevent injury. Injured workers may also be able to seek compensation for their injuries
from the makers of faulty or dangerous industrial products. Victims of industrial accidents greatly benefit
from consulting a personal injury lawyer who can advise them of their rights and options in a case.
Industrial Accident Prevention

Industrial accidents refer to any accident that occurs on an industrial site. Causes can range from workers''
negligence or fatigue to faulty machinery, improper supervision of the work site, inadequate safety
precautions and unknown safety hazards.

When industrial accidents are the result of workers'' negligence or fatigue, the injured party can
seek workers'' compensation - a portion of pay to compensate for disability and medical Einstein
College of Engineering expenses due to the accident. When a third party - such as a site supervisor
or equipment manufacturer - is responsible for inadequate safety training, enforcement of safety
regulations or design and production of faulty products, the injured party may be entitled to
additional damages gained through an industrial accident lawsuit. In most cases, industrial
accident prevention revolves around the safety of the industrial site. On construction sites, for
example, contractors are required to inspect the site with safety engineers and to warn employees
of possible danger zones. Workers, in turn, must comply with the safety requirements set forth by
their supervisors in order to maximize industrial accident prevention. If contractors or
subcontractors fail to enforce safety rules or take safety precautions on their industrial site, they
can be held liable in a third party suit. If workers'' negligence is to blame, the injured party is only
entitled to workers'' compensation. Industrial accident prevention also lies on the shoulders of the
manufacturing companies of equipment frequently used on industrial sites. Such equipment
consists of, but is not limited to: scaffolding (many industrial accidents are caused by falls from
heights or faulty scaffolds), motorized vehicles (tractors, forklifts), gas pressure machinery,
electricity conductors and heavy machinery. Industrial accident prevention obligates equipment
and machinery manufacturers to design, produce and maintain properly functioning products.
When industrial accident prevention fails and an incident occurs, it is imperative to determine the
negligent party in order to reach a fair settlement. A personal injury lawyer can help ascertain
responsibility in an industrial accident case. Occupational Health Introduction Occupational
hazards cause or contribute to the premature death of millions of people worldwide and result in
the ill health or disablement of hundreds of millions more each year. The burden of disease from
selected occupational risk factors amounts to 1.5% risks of the global burden in terms of DALY.
The World Health Report 2002 places occupational risks as the 10thleading cause of morbidity
and mortality. Almost 22.5 million DALY and 699,000 deaths are attributable to these risk factors.
According to the Report, work related injuries cause nearly 310,000 deaths each year, and nearly
146,000 deaths are attributable from the region remains largely uncharacterised. Member countries

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of South East Asia Region have witnessed major occupational health problems highlighted by the
Bhopal disaster in India and the Kader Toy Factory fire in Thailand. However, workers of the
region are exposed to a wider range of occupational hazards and risks including chemical, physical
and biological hazards as well as inadequate ergonomics practice and high psychsocial stress.
Most of the countries in the Region are in the process of rapid economical development, a process
that potentially amplifies the pre-existing traditional risks and introduces new occupational risks in
the region. Thus occupational health is of major concern in the South East Asia Region of WHO
with a work force of about 500 million persons.

Strategic Goals Objective Activity

1. Strengthening of occupational 1. Sharing a common occupational 1. Existing National centers to start

health network health and safety strategy 2. local networking 2. Expansion of
Expansion of network 3. network towards eventual WHO

44
 Information sharing 4. Enhanced Designation 3. Share information on
Inter Agency collaboration norms, standards, guidelines, modules
and methods through web base, mail
and meeting
2. Promotion of health risk paradigm 1. Compilation of country profiles 1. Development of standard protocol
2.1 Health risk assessment 2.2 on occupational hazards. 2. for rapid assessment of country hazard
Health Risk Management Improvement and applications of profile 2. Establishing national data
exposure assessment methods and base of hazards profiles 3. Development
guidelines 1. Promoting Protective and promulgation of standard protocols
Policies 2. Promoting Protective for exposure assessment 4. Developing
Practices through engineering, and compilation of job-exposure matrix
biological, administrative and 1. Including safety clause in
training measures 3. Strengthen international trade and technology
surveillance system for tracking transfer. 2. Collaborating with
pattern of occupational injuries and Ministries of Labor, factory inspectorate
diseases 4. Formulation of National and UN agencies to improve
plan of action engineering control and use of Personal
Protective Device 3. Intersectoral
collaboration to improve environmental
monitoring of worker places 4.
Strengthening methods for regular
biological monitoring of work-places 5.
Enhancing health promotion by training
of health care giver and workers 6.
Conducting epidemiological studies in
relevant target and vulnerable groups to
assess Threshold Limit Values(TLV) of
occupational hazards 7. Develop
regional guidelines and national
protocols and data bases for
occupational disease and injury
surveillance 8. Provide technical
support for formulation of national plan
based on regional strategy and national
situation analysis.
3. Capacity Building 1. Assessing, Strengthening and 1. Review of existing short course
implementation of Occupational curriculum in each country and
Safety and Health Training 2. regionally 2. Standardize course
Building capacity for research in contents and teaching method in
occupational Safety and Health industrial hygiene, basic medical
surveillance, occupational health and
safety management, chemical exposure
in agricultural hygiene and other
nationally relevant areas. 3. Support
training in these areas and surveillance
of occupational diseases 4. Standardize
protocol for burden of disease estimates
in major economic sectors.

PSYCHOLOGICAL PROBLEM – MEANING Scientific discipline that studies mental processes and
behaviour in humans and other animals. Literally meaning "the study of the mind," psychology focuses
on both individual and group behaviour. Clinical psychology is concerned with the diagnosis and
treatment of mental disorders. Other specialized fields of psychology include child psychology,
educational psychology, sports psychology, social psychology, and comparative psychology. The issues

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studied by psychologists cover a wide spectrum, including learning, cognition, intelligence, motivation,
emotion,perception, personality, and the extent to which individual differences are shaped by genetics or
environment. The methods used in psychological research include observation, interviews, psychological
testing, laboratory experimentation, and statistical analysis.
Psychological Disorders
Symptoms, Treatments, & Statistics of Psychological Problems
Here's a guide to various mental illnesses and psychological disorders, such as obsessive compulsion,
schizophrenia, phobias, anxiety disorders, and depression. Psychological disorders range from post
traumatic stress syndrome to common phobias. This guide to various psychological disorders is a good
introduction to mental illnesses, both mild and severe.

WORKFORCE IN INDIA The dimensions and complexities of the problem in India can be better
appreciated by taking into consideration the extent of the labour force in the organized and unorganized
sectors. The latest NSSO survey of 1999-2000 has brought out the vast dichotomy between these two
sectors into sharp focus. While as per the 1991 census, the total workforce was about 314 million and the
organized sector accounted for only 27 million out of this workforce, the NSSO’s survey of 1999-2000
has estimated that the workforce may have increased to about 397 million out of which only 28 million
were in the organized sector. Thus, it can be concluded from these findings that there has been a growth
of only about one million in the organized sector in comparison the growth of about 55 million in the
unorganized sector. Organized and Unorganized Sectors The organized sector includes primarily those
establishments which are covered by the Factories Act, 1948, the Shops and Commercial Establishments
Acts of State Governments, the Industrial Employment Standing Orders Act, 1946 etc. This sector already
has a structure through which social security benefits are extended to workers covered under these
legislations. The unorganized sector on the other hand, is characterized by the lack of labour law
coverage, seasonal and temporary nature of occupations, high labour mobility, dispersed functioning of
operations, casualization of labour, lack of organizational support, low bargaining power, etc. all of which
make it vulnerable to socio-economic hardships. The nature of work in the unorganized sector varies
between regions and also between the rural areas and the urban areas, which may include the remote rural
areas as well as sometimes the most inhospitable urban concentrations. In the rural areas it comprises of
landless agricultural labourers, small and marginal farmers, share croppers, persons engaged in animal
husbandry, fishing, horticulture, bee-keeping, toddy tapping, forest workers, rural artisans, etc. where as
in the urban areas, it comprises mainly of manual labourers in construction, carpentry, trade, transport,
communication etc. and also includes street vendors, hawkers, head load workers, cobblers, tin smiths,
garment makers, etc.

SOCIAL SECURITY LAWS The principal social security laws enacted in India are the
following: (i) The Employees’ State Insurance Act, 1948 (ESI Act) which covers factories and
establishments with 10 or more employees and provides for comprehensive medical care to the
employees and their families as well as cash benefits during sickness and maternity, and monthly
payments in case of death or disablement. ii) The Employees’ Provident Funds & Miscellaneous
Provisions Act, 1952 (EPF & MP Act) which applies to specific scheduled factories and establishments
employing 20 or more employees and ensures terminal benefits to provident fund, superannuation
pension, and family pension in case of death during service. Separate laws exist for similar benefits for
the workers in the coal mines and tea plantations. (iii) The Workmen’s Compensation Act, 1923 (WC
Act), which requires payment of compensation to the workman or his family in cases of employment
related injuries resulting in death or disability. (iv) The Maternity Benefit Act, 1961 (M.B. Act), which
provides for 12 weeks wages during maternity as well as paid leave in certain other related contingencies.
(v) The Payment of Gratuity Act, 1972 (P.G. Act), which provides 15 days wages for each year of service
to employees who have worked for five years or more in establishments having a minimum of 10
workers. Separate Provident fund legislation exists for workers employed in Coal Mines and Tea
Plantations in the State of Assam and for seamen. NEW INITIATIVES –  The various Central Acts on

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Social Security are being examined in the light of the recommendations of the 2nd National Commission
on Labour. Relevant amendments are proposed in the EPF and MP Act as also the ESI Act. The
consultation process is on with reference to the amendment suggestions received in case of the Maternity
Benefit Act and the Workmen’s Compensation Act.  Innovative measures are proposed in the running
of the Social Security Schemes of EPFO and ESIC. This includes flexible benefit schemes tailored to the
specific requirements of different segments of the population.

PRESENT INITIATIVES IN WORKING OF EPFO & ESIC The profiles of the

Employees’ Provident Fund Organization and the Employees’ State Insurance Corporation are being
changed towards greater accessibility and client satisfaction. The EPFO extends to the entire country
covering over 393824 establishments. At present, over 3.9 crore EPF Members and their families get
benefits under the social security schemes administered by the EPFO. The total corpus of the EPF
Scheme 1952, EDLI Scheme, 1976 and Employees Pension Scheme 1995 together amounts to about
Rs.1,39,000 crores. Over the years, the volume of service rendered to subscribers as well as investments
made, etc. by EPFO have grown manifold. With a view to provide better services to subscribers and
employers, the organization has launched the Project RE-INVENTING EPF, INDIA since June, 2001.
The prime objectives of this Project are to provide the subscribers better and efficient services, to help the
employers by reducing the cost of compliance and to benefit the organization to register geometric growth
in all fields. An important part of this Project is the allotment of the UNIQUE IDENTIFICATION
NUMBER-the SOCIAL SECURITY NUMBER to the EPF subscribers, issuing of BUSINESS
NUMBERS to the employers and Business Process Re-engineering. The strategy for implementation has
been evolved and the allotment of the Social Security Number has begun with the entire activity being
carried out in smaller phases for effective data collection. The criteria considered for the allotment of SSN
include the centralized control of Uniqueness, ensuring the least manual intervention during allotment and
near 100% Uniqueness accuracy levels. The Social Security Number in a nutshell is a big effort towards
solving the problem of providing social protection to migrant labour and to make the data base of EPFO
adaptable to the present trend of high job mobility among workers. The Employees State Insurance
Scheme provides need based social security benefits to insured workers in the organized sector. As in the
case of the EPFO, the ESIC has also taken up the daunting task of tailoring different benefit schemes for
the needs of different worker groups. The scheme, which was first introduced at two centers in 1952 with
an initial coverage of 1.20 lakh workers, today covers 71.59 lakh workers in about 678 centers in the
country. It benefits about 310. 54 lakh beneficiaries including the family workers of the insured persons,
across the country. The scheme is being gradually to cover new centers and steps are being taken for
creation of requisite infrastructure for providing medical care to a larger number of insured persons and
their families. While the cash benefits under the scheme are administered through a network of about 850
local offices and pay offices, medical care is provided through 141 ESI Hospitals, 43 ESI Annexes, 1451
ESI Dispensaries and 2789 Clinics of Insurance Medical Practitioners. The total number of medical
officers under the Scheme is about 10,480. There have been a number of new
developments in the ESIS during the past five years. Each year, it is extended to new areas to cover
additional employees. The new employees covered varied from 30,500 in 1998, 89030 in 2000 to 46430
till Jan., 2003. Low paid workers in receipt of daily wages up to Rs. 40/- have been exempted from
payment of their share of contribution. Earlier this limit was Rs. 25/-. This measure has benefited about
six lakh insured workers across the country. In order to provide relief to insured persons suffering from
chronic and long term diseases, the list of diseases for which Sickness Benefit is available for an extended
period up to two years at an enhanced rate of 70% of daily wages, was enlarged by adding four new
diseases, keeping in view the international classification of disease profiles and the quantum of
malignancies of some diseases which had come to light over the last few years. The contributory
conditions for this benefit were also reduced from 183 days to 156 days in the two-year period preceding
the diagnosis. The ESIC has made plans to commission Model hospitals in each State. Thirteen States/
UTs have so far agreed, in principle, to hand over one hospital each to the ESIC for setting up of Model
hospital. Two Hospitals have been earmarked for being developed for superspeciality medical care in

47
cardiology, i.e., Rohini at Delhi and Chinchwad in Maharashtra. In order to improve the standard of
medical care in the States, the amount reimbursable to the State Governments for running the medical
care scheme has been increased to 87.5 % of Rs. 700 per capita with effect from 1.4.2003. The ESIC has
formulated action plans for improving medical services under the ESI scheme with focus on
modernization of hospitals by upgrading their emergency and diagnostic facilities, development of
departments as per disease profiles, waste management, provision of intensive care services, revamping
of grievance handling services, continuing education programme, computerization and upgradation of
laboratories etc. The action plans have been in operation since 1998. The ESIC has also taken certain new
initiatives to promote and popularize Indian Systems of Medicines (ISM) along with Yoga and have
drawn up programmes for establishing these facilities in ESI hospitals and dispensaries in a phased
manner. SOCIAL SECURITY TO THE WORKERS IN THE ORGANIZED SECTOR Social Security to
the workers in the Organized Sector is provided through five Central Acts, namely, the ESI Act, the EPF
& MP Act, the Workmens’ Compensation Act, the Maternity Benefit Act, and the Payment of Gratuity
Act. In addition, there are a large number of welfare funds for certain specified segments of workers such
as beedi workers, cine workers, construction workers etc. SOCIAL SECURITY COVERAGE IN INDIA
Most social security systems in developed countries are linked to wage employment. In India our
situation is entirely different from that obtaining in developed countries. The key differences are: i) We
do not have an existing universal social security system ii) We do not face the problem of exit rate from
the workplace being higher than the replacement rate. Rather on the contrary lack of employment
opportunities is the key concern, iii) 92% of the workforce is in the informal sector which is largely
unrecorded and the system of pay roll deduction is difficult to apply. Even today 1/8th of the world’s
older people live in India. The overwhelming majority of these depend on transfers from their children.
Addressing social security concerns with particular reference to retirement income for workers within the
coverage gap has been exercising policy makers across the world. In India the coverage gap i.e. workers
who do not have access to any formal scheme for old-age income provisioning constitute about 92% of
the estimated workforce of 400 million people. Hence the global debate and evaluation of options for
closing the coverage gap is of special significance to India. The gradual breakdown of the family system
has only underscored the urgency to evolve an appropriate policy that would help current participants in
the labour force to build up a minimum retirement income for themselves. 4. The coverage gap in India is
broadly categorized under the following groups: a) Agricultural sector = 180 million. b) Contract,
services, construction = 60 million. c) Trade, Commerce, transport, storage & Communications = 100
million. d) Others = 30 million. ___________ Total = 370 million HOWEVER ONE IMPORTANT
FACTOR TO BE KEPT IN MIND ON THE COVERAGE ISSUE IS THAT THIS CLASSIFICATION
DOES NOT INCLUDE THE VARIOUS SOCIAL SECURITY SCHEMES RUN BY OTHER
MINISTRIES FOR DIFFERENT TARGET GROUPS. WE HAVE ALSO NOT INCLUDED INDIRECT
FUNDING THROUGH SUBSIDIES, PDS, SOCIAL ASSISTANCE PROGRAMMES, FOOD-FOR-
WORK PROGRAMMES, TAX CONCESSIONS ETC.
EXTENSION OF COVERAGE

EPFO Programs At A Program Type Financing Coverage

Glance Program name

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Employees Provident  Mandatory  Employer: 1.67-3.67%  Firms with + 20
Fund (EPF)  Employee:10-12%  employees
Government: None

Employees Pension  Mandatory  Employer: 8.33%   Firms with + 20

Scheme (EPS) Employee: None  employees
Government: 1.16%

ESI Contribution Rates  Employees- 1.75% of wages  Employers- 4.75% of wages  State Govts.-
1/8th share of expenditure A few examples of other retirement programs giving social security
(Information on extent of Program Type Financing Coverage
coverage of the labour
force under these
programs is not
available) Program Name
Civil Service Pension Mandatory Mandatory State or Central Civil servants at state and
Scheme Government Government Employee central government level
Provident Fund contributions Civil servants at state and
central government level

Special Provident Funds Mandatory Employer and employee Applies to Workers in

contributions particular sectors: Coal,
Mines, Tea Plantation,
Jammu and Kashmir
Seamen, etc.
Public Provident Fund Voluntary Contributions All individuals are
eligible to apply
VRS plans Voluntary Contributions Employees as decided by
respective establishments
Personal Pension Voluntary Purchase of annuity type All individuals
products
State level social Government sponsored State Government Varies by State and type
assistance social assistance of Scheme
National Old Age Government sponsored Central Government Poor persons above age
Pension Scheme social assistance 65

MOTIVATION THEORIES
Performance is a function of ability and motivation. P = f (A x M)
Definition 1: Choices among voluntary activities
A process governing choices made by persons or lower organisms among alternative forms of voluntary
activity
Definition 2: Arouse enthusiasm to pursue
A result of internal and external processes to the individual that arouse enthusiasm and persistence to
pursue a certain course of action
Definition 3: Need that activates behavior

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A process that starts with a physiological deficiency or need that activates behavior or a drive that is
aimed at a goal or an incentive.
Meaning of Motivation
Motivation is a set of forces that cause people to behave in certain ways.
Motivation Process (6 Steps)
1. Individual Needs
2. Search for ways to satisfy needs
3. Goal & Objectives directed
4. Increased performance
5. Receiving rewards or punishment
6. Reassessment of needs
Criticality of Motivation to Managers
Importance of Motivation
 Motivation helps employees find new ways of doing a job
 Motivation makes employees quality conscious
 Motivation increases productivity very high
 Motivation stimulates both participation and production at work
 Motivation comprehends jobs related behaviors
 Motivation increases attention towards human resources along with physical resources
Challenges of Motivation
 Diverse and changing workforce
 Rightsizing, Downsizing, Hire-n-Fire, Pay-for-Performance strategies
 Motives can only be inferred, not seen
 Dynamic nature of human needs
Objectives of Motivation
High productivity
Increase quality consciousness
Stimulate participation at work
Theories of Motivation
Early Theories
Scientific Management: Motivation by scientific management is associated with F.W. Taylor’s
techniques of scientific management. Taylor said that people are primarily motivated by economic
rewards and will take direction if offered an opportunity to improve their economic positions. Based on
this Taylor described following arguments
 Physical work could be scientifically studied to determine optimal method of performance of a
job
 Workers could be more efficient by telling them how they were to do a job
 Workers would accept the above prescription if paid on differentiated piecework basis
 Disadvantages – Dehumanized workers, treated them as mere factors of production, only stressed
on monetary needs, ignored human needs
Human Relations Model: Elton Mayo’s human relations model stressed on social contacts as
motivational factor. Greater importance was given to informal groups. However too much reliance on
social contacts to improve productivity was a major drawback.
Contemporary Theories

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Content Theories (Maslow’s Need Hierarchy, Herzberg’s 2-factors, Alderfer’s ERG, Achievement
Motivation Theory)
Process Theories (Vroom’s expectancy, Adam’s Equity, Porter’s Performance and Satisfaction Model)
Reinforcement categories
ERG Theory (Alderfer): Existence – Relatedness – Growth
ERG theory emphasizes more on three broad needs that is existence, relatedness and growth. Its
hypothesis is that there may be more than one need operating at the same time. ERG theory further states
that when a higher level need is frustrating, the individual’s desire to increase lower level needs takes
place. Thus ERG theory contains frustration-regression dimension. Frustration at higher level need may
lead to regression at lower level need.
Advantages – More consistent with our knowledge of differences among people, it is less restrictive and
limiting, it is a valid version of need hierarchy.
Disadvantages – No clear-cut guideline of individual behavior patterns, too early to pass a judgment on
the overall validity of the theory.
Two-Factor Theory (Herzberg)
Fredrick Herzberg states that the motivation concept is generally driven by two factors of motivators of
job satisfactions and hygiene factors about job dissatisfaction. Motivators are generally achievement,
recognition, the work itself, responsibility, advancement and growth, which are related to job satisfaction.
Hygiene factors deal with external factors like company policy, supervision, administration and working
conditions, salary, status, security and interpersonal relations. These factors are known as hygiene factors
or job dissatisfiers, job context factors.
Advantages – tremendous impact on stimulating thought on motivation at work, increased understanding
of role of motivation, specific attention to improve motivational levels, job design technique of job
enrichment is contribution of herzberg, double dimensions of two factors are easy to interpret and
understand.
Disadvantages – Limited by its methodology, reliability questioned, it focuses more on job satisfaction
not on motivation, no overall measure of satisfaction utilized, inconsistent with previous research,
productivity factor ignored.

MORALE
Definition 1: Mental condition, attitude, willingness
Morale is a mental condition or attitude of individual and groups, which determines their willingness to
co-operate.
Definition 2: Attitudes, voluntary cooperation
Morale is attitudes of individuals and groups towards their work environment and towards voluntary
cooperation to the full extent of their ability in the best possible interest of the organization.

Distinction between Morale and Motivation: -

Morale Motivation
1. Composite of feelings, attitudes and 1. Motivation moves person to action.
sentiments that contribute towards general 2. A Process of stimulating individuals into

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satisfaction at workplace. action to accomplish desired goals.
2. A Function of freedom or restraint towards 3. A Function of drives and needs.
some goal. 4. It mobilizes energy.
3. It mobilizes sentiments. 5. Motivation is a potential to develop morale.
4. Morale reflects Motivation.

Importance of Morale as a Responsibility of Management

 Organization Climate: Morale is an important part of organization climate.
 Attitudes & Sentiments: Morale reflects attitudes and sentiments towards organization goals and
objectives.
 Productivity: Morale highly affects productivity and satisfaction of individuals.
 Total Satisfaction: Morale is total satisfaction derived from employees job, boss and his
organization.
 Labor Problems Solved: High morale assists managers to overcome several labor problems like
labor turnover, absenteeism, indiscipline, grievances, disharmony etc.
 Cooperation: Morale helps to seek cooperation from the workers in getting higher production at
minimum possible cost by reducing wastages of time, man, machines and materials.
 Production & Productivity: Production and productivity are directly affected by high morale in a
positive manner.

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