UNIT-3

1- Industrial relation and International practices in Industrial

relation
A number of human resources best practices can help you develop a productive and collegial
relationship between management and organized labor. Up-to-date information about labor laws,
leadership training on basic industrial relations practices and well-constructed negotiation strategy are
elements that will improve your organization’s labor-management relations. Turn what traditionally
has been an adversarial relationship into one that benefits your company and employees.

Labor Laws

Fundamental to the labor-management relationship is clarity about applicable laws, such as the
National Labor Relations Act. The act establishes employees’ rights and sets out the obligations and
responsibilities of employers and labor unions. In addition to understanding basic labor law, HR best
practices include staying abreast of changes in the laws and decisions of the National Labor Relations
Board that affect your industry and your workplace.

Leadership Training

Much of leadership training covers how to assign work and provide feedback about performance and
basic employment law, such as Title VII of the Civil Rights Act and preventing workplace
harassment. Supplement your supervisory training with labor-management-related components, such
as union contract interpretation, conflict resolution and, if your workforce isn’t unionized, how to
maintain a union-free workplace. Supervisors and managers have the most direct contact with
workers, and workforce management principles suggest that HR equip them with the skills necessary
to be first responders concerning labor-management issues.

Collective Bargaining

HR best practices in collective bargaining include developing management strategy and proposals for
contract negotiation at least six months before the contract expiration date. Assess the negotiating
team’s workload and reassign long-term projects that could interfere with their availability for
bargaining sessions. The NLRA requires that both management and the union make themselves
available for contract negotiations, as that demonstrates good faith. If you anticipate changes in your
employee benefits package, get clarification from your compensation and benefits specialist on how
the group health plan, pension and other benefits will affect negotiations.

Resources

Take advantage of resources available to HR staff, supervisors and managers. Continuing education
courses, workshops and seminars on building relationships with labor union representatives generally
are sponsored by law firms, management consulting groups and colleges. Use social media and
Internet research to learn about union-organizing drives, including the occupations and industries that
labor unions are targeting.

Union-Free Workplace
If your employees aren’t union workers, improve your employee relations practices. Strengthen the
employer-employee relationship by addressing workplace issues as soon as possible to avoid the
lingering effects of conflict that often lead employees to seek unionization. Conduct routine
vulnerability assessments to determine the likelihood of your employees supporting a union.
Vigilance pays off — showing interest in and appreciation for your employees keeps job satisfaction
high so they won’t seek union representation.

Grievance Handling

HR management should address union grievances as soon as they arise. When a union employee feels
that he has been unjustly reprimanded or terminated, he can file a grievance. The HR manager or a
labor relations specialist is responsible for processing a union-employee grievance, which usually is a
three-step process. The process includes a union steward who represents the employee’s interests. If
the matter isn’t resolved within the allotted three steps, the case goes to arbitration. The arbitration
process can be as lengthy and costly as litigation, both being processes that HR management would
like to avoid whenever possible.

2- Shifts in IHRM and IR

There have been several shifts in International Human Resource Management (IHRM) and Industrial
Relations (IR) over the years. Here are some of the key shifts:

Globalization: With the increasing globalization of business, there has been a shift towards managing
a more diverse workforce across different countries and cultures. This has led to a greater emphasis on
IHRM, including managing international assignments, cross-cultural training, and developing global
compensation and benefits packages.

Technological advancements: The rise of technology has enabled more remote working and
collaboration across borders, leading to a greater need for managing virtual teams and ensuring
effective communication and collaboration.

Economic changes: Changes in the global economy have led to increased competition for talent, as
well as changes in the demand for skills and the nature of work. This has led to a greater emphasis on
talent management and workforce planning in IHRM.

Legal and regulatory changes: Changes in labor laws, immigration policies, and other legal and
regulatory frameworks have impacted how organizations manage their workforce across borders. This
has led to a greater need for compliance and risk management in IHRM.

Changing attitudes towards work: There has been a shift in attitudes towards work, with employees
placing greater importance on work-life balance, job satisfaction, and purpose-driven work. This has
led to a greater emphasis on employee engagement and well-being in IHRM.

Digitalization and AI: The rise of digitalization and artificial intelligence has led to new ways of
managing the workforce, including the use of HR analytics, talent assessment tools, and chatbots for
employee support.
3- SHRM: Definition, Need and Importance
Strategic human resource management or SHRM is a branch of HRM. It emerged from the
discipline of human resource management and is a fairly new field. Strategic HRM is defined as “the
linking of human resources with strategic goals and objectives in order to improve business
performance and develop organizational culture that foster innovation and competitive advantage.”
SHRM in an organization means “to accept and involve the functions of HR as a strategic partner in
formulating and implementing the company’s strategies through human resource activities which may
involve recruiting, selecting, rewarding and training company personnel. In spite of the similarity in
names, HRM and SHRM are two different practices; SHRM is basically a part of the complete HRM
process. Besides that SHRM focuses more on long-term objectives rather than the in-house objectives
with employees dealt by HRM. In the late 1980’s writers started stating strong opinions for a much
more strategic approach to managing people than was the standard practice of that time. They
clamored for the change of traditional management practices of industrial relations and people to the
modern more improved ones.

The center point of SHRM is to address and solve problems that effect management programs
centering on people in the long run and more than often globally. We can say that the main goal or
objective of SHRM is to increase productivity not only in the employees but in the business overall, it
achieves this by focusing on business problems and obstacles outside of the human resources range.
SHRM identifies important human resource areas where strategies can be implied for the
improvement of productivity and employee motivation. To achieve good results communication
between human resource and top management of the organization is of utmost importance as
cooperation is not possible without active participation.

KEY FEATURES OF SHRM

The key features of strategic human resource management are given below:

 Some organizing strategies or schemes link individual human resource interventions so that
they are ‘mutually supportive’
 A great amount of responsibility is transferred down the line for the management of HR
 There is a precise link between overall organization strategy, organization environment, HR
policies and practices.

DEVELOPMENT IN SHRM

In recent times HRM professionals have been facing challenges with employee participation,
performance management, employee reward systems, high commitment work systems and human
resource flow because of globalization. Traditional models and techniques have no place in today’s
business world; also local companies which go global cannot use the same tactics in the global
business world. Top managements and HR professionals that are involved in strategic human resource
management face a wide range of issues which include some of the following:

 Rapid change in technology

 Introduction of new concepts of general management
 Globalization of market integration
 Increased competition, which may not necessarily be local
 Resultant corporate climates
 Constantly changing ownership
4-International labour Standards
International labour law is the body of rules spanning public and private international law which
concern the rights and duties of employees, employers, trade unions and governments in regulating
the workplace. The International Labour Organization and the World Trade Organization have been
the main international bodies involved in reforming labour markets. The International Monetary Fund
and the World Bank have indirectly driven changes in labour policy by demanding structural
adjustment conditions for receiving loans or grants. Issues regarding Conflict of laws arise,
determined by national courts, when people work in more than one country, and supra-national
bodies, particularly in the law of the European Union, has a growing body of rules regarding labour
rights.

International labour standards refer to conventions agreed upon by international actors, resulting from
a series of value judgments, set forth to protect basic worker rights, enhance workers’ job security,
and improve their terms of employment on a global scale. The intent of such standards, then, is to
establish a worldwide minimum level of protection from inhumane labour practices through the
adoption and implementation of said measures. From a theoretical standpoint, it has been maintained,
on ethical grounds, that there are certain basic human rights that are universal to humankind. Thus, it
is the aim of international labour standards to ensure the provision of such rights in the workplace,
such as against workplace aggression, bullying, discrimination and gender inequality on the other
hands for working diversity, workplace democracy and empowerment.

While the existence of international labour standards does not necessarily imply implementation or
enforcement mechanisms, most real world cases have utilised formal treaties and agreements
stemming from international institutions. The primary international agency charged with developing
working standards is the International Labour Organization (ILO). Established in 1919, the ILO
advocates international standards as essential for the eradication of labour conditions involving
“injustice, hardship and privation”. According to the ILO, international labour standards contribute to
the possibility of lasting peace, help to mitigate potentially adverse effects of international market
competition and help the progress of international development.

Implementation, however, is not limited to the ILO nor is it constrained to the legislative model that
the ILO represents. Other alternatives include direct trade sanctions, multilateral enforcement, and
voluntary standards. In addition to controversies that arise over each of these models, greater issues
have also been raised concerning the debate over the need for international labour standards
themselves. However, while critics have arisen, the international community has largely come to a
consensus in favour of basic protection of the world’s labour force from inhumane practices.

Associated with the development of successful international labour standards is proper monitoring
and enforcement of labour standards. Most monitoring occurs through the ILO, but domestic agencies
and other NGOs also play a role in the successful monitoring of international labour standards.

Objective of ILO

 Formulation of international policies and programmes to promote basic human rights,

improve working and living conditions, and enhance employment opportunities;
 Creation of international labour standards in the form of Conventions and Recommendations,
backed by a unique system to supervise their application;
 An extensive programme of international technical cooperation.
 Training, education, research, and publishing activities to help advance all of these efforts.
 To promote and realize standards and fundamental principles and rights at work;
 To create greater opportunities for women and men to secure decent employment;
 To enhance the coverage and effectiveness of social protection for all.
STRUCTURE OF ILO

Some of the most important organisational structure of ILO are as follows:

1. International Labour Conference (ILC)

2. Governing Body
3. International Labour Office (ILO).

(1) INTERNATIONAL LABOUR CONFERENCE (ILC)

This is the Apex body of ILO which makes labour policies for international labour. The ILC holds its
sessions at a frequency not less than once in a year. The delegates from three group’s viz. the
government, the employers’ and the workers attend ILC sessions in the ratio of 2:1:1 respectively.
Each representative has a vote. The representatives from the Government are mostly ministers,
diplomats or officials.

The conference is empowered to appoint committees to deal with different matters relating to labour
during each session. Examples of such committees are the selection committee, The Credential
Committee, The Resolution Committee, The Drafting Committee, The Finance Committee, etc. All
committees except Finance Committee are tripartite in nature.

The functions performed by the ILC are to:

1. Formulate international labour standards.

2. Fix the amount of contribution to be paid by the member states.
3. Decide budget and submit the same to the Governing Body.
4. Study the labour problems submitted by the Director General and assist in their solutions.
5. Appoint committees to deal with different problems during its sessions.
6. Elect the president.
7. Select members of the Governing Body.
8. Develop policies and procedures.
9. Seek advisory opinion from International Committee of Justice.

 Confirm the powers, functions and procedure of Regional Conference.

(2) GOVERNING BODY

It is also a tripartite body. It implements decisions of the ILC with the help of the International Labour
Organization. It consists of 56 members in the same ratio of 2:1:1, i.e. 28 representatives of the
Government, 14 of the employers and 14 of the workers. Of the 28 representatives of the Government,
10 are appointed by the members of the States of Chief Industrial Importance and remaining 18 are
delegates of the other governments.

Industrial population is the criteria for chief Industrial Importance. India is one of the ten states of
chief Industrial Importance. The tenure of the office of this body is 3 years. It meets frequently in a
year to take decisions on the programmes of the ILO.

The functions of the Governing Body are to:

1. Co-ordinate work between the ILC and ILO.

 2. Prepare agenda for each session of the ILC.
3. Appoint the Director General of the office.
4. Scrutinize the budget.
5. Follow up with member states in regard to implementation of the conventions and
recommendations adopted by the ILC.
6. Fix the date, duration, schedule and agenda for the Regional Conferences
7. Seek as and when required, advisory opinion from the International Court of Justice with the
consent of the ILC.

(3) International Labour Office:

This is the secretariat of the ILO in Geneva and is the third major organ of the ILO. The Director
General (DG) of the ILO is the Chief Executive Officer of the Secretariat appointed by the Governing
Body. He also serves as the Secretary General of the ILC. His tenure is for 10 years and extendable by
the Governing Body.

The Director General is assisted by two Deputy Director Generals, six Assistant Director Generals,
one Director of the International Institute of Labour Studies, and one Director of the International
Centre for Advanced Technical and Vocational Training, Advisors, Chief of Divisions from 100
nations.

Following are the main functions of this office:

1. Prepare briefs and documents for agenda of ILC.

2. Assist the Governments of the States to form labour legislation based on recommendations of
the ILC.
3. Bring out publications relating to industrial labour problems of international nature and
interest.
4. Carry out functions related to the observance of the conventions.
5. Collect and distribute information on international labour and social problems.
6. To promote and realize standards and fundamental principles and rights at work;

THE ROLE OF THE ILO

The mission of the International Labour Organization (ILO) is to promote social justice and
internationally recognized human and labour rights, based on the founding principle that social justice
is essential to universal and lasting peace.

Decent Work Agenda

As part of its mission, the ILO aims to achieve decent work for all by promoting social dialogue,
social protection and employment creation, as well as respect for international labour standards. The
ILO provides technical support to more than 100 countries to help achieve these aims, with the
support of development partners.

1 Comment

International labour standards

The ILO sets international labour standards with Conventions, which are ratified by member states, or
Recommendations, which are non-binding.
Conventions are drawn up with input from governments, workers’ and employers’ groups at the ILO.
Conventions are adopted by the International Labour Conference, which meets every year in Geneva.

The ILO’s supervisory role

The ILO monitors the implementation of ILO Conventions ratified by member states. This is done
through:

 The Committee of Experts on the Application of Conventions and Recommendations

 The International Labour Conference’s Tripartite Committee on the Application of
Conventions and Recommendations
 Member states are also required to send reports on the progress of the implementation of the
Conventions they have ratified.

ILO Declaration on Fundamental Principles and Rights at Work

Adopted in 1998, the Declaration commits member states to respect and promote eight fundamental
principles and rights in four categories, whether or not they have ratified the relevant Conventions.

They are:

 Freedom of association and the right to collective bargaining (Conventions 87 and 98)
 The elimination of forced or compulsory labour (No. 29 and No. 105)
 The abolition of child labour (Conventions No. 138 and No. 182)
 The elimination of discrimination in respect of employment and occupation

5- International Strategic Human Resources management

International Strategic Human Resource Management (ISHRM) refers to the development and
implementation of HR strategies that support the achievement of an organization’s global business
objectives. Here are some key features of ISHRM:

Alignment with business strategy: ISHRM involves aligning HR strategies with the overall business
strategy of the organization. This includes developing HR strategies that support the organization’s
goals for growth, market share, and profitability.

Global mindset: ISHRM involves developing a global mindset among HR professionals, recognizing
the cultural and institutional differences that exist in different countries and regions, and developing
HR strategies that are responsive to those differences.

Talent management: ISHRM involves identifying and developing talent across the organization, with
a focus on building a diverse and inclusive workforce that can contribute to the organization’s success
in different regions.

HR analytics: ISHRM involves the use of data and analytics to inform HR decision-making, including
the use of metrics to measure the effectiveness of HR strategies in supporting business objectives.

Flexibility and agility: ISHRM involves developing HR strategies that are flexible and agile, able to
adapt to changing business needs and market conditions in different countries and regions.
Risk management: ISHRM involves managing HR-related risks, including compliance with local
labor laws and regulations, protecting intellectual property, and ensuring the safety and security of
employees working in different regions.

In summary, ISHRM involves developing and implementing HR strategies that support an

organization’s global business objectives, while also recognizing the cultural and institutional
differences that exist across different countries and regions. By aligning HR strategies with business
strategy, building a diverse and inclusive workforce, and leveraging data and analytics to inform
decision-making, organizations can achieve greater success in the global marketplace.

International Labour Standards

International Labour Standards (ILS) are a set of guidelines, principles, and norms established by the
International Labour Organization (ILO) to promote decent work and social justice worldwide. ILS
are developed through a tripartite process involving representatives from governments, employers,
and workers.

ILS cover a wide range of issues related to work and employment, including:

Fundamental principles and rights at work: This includes the abolition of child labor, elimination of
forced labor, freedom of association and the right to collective bargaining, and elimination of
discrimination in employment.

Industrial relations: This includes policies related to collective bargaining, labor-management

relations, and dispute resolution.

Social dialogue: This includes policies related to promoting dialogue between workers, employers,
and governments on issues related to employment, labor market policies, and social protection.

ILS are not legally binding, but they provide guidance and a framework for the development of
national laws and policies related to work and employment. ILO member states are encouraged to
incorporate ILS into their national legal frameworks and to promote their implementation.

In summary, ILS are a set of guidelines and principles developed by the ILO to promote decent work
and social justice worldwide. They cover a wide range of issues related to work and employment, and
provide a framework for the development of national laws and policies. While not legally binding,
ILS are an important tool for promoting fair and decent working conditions globally.

Global Unions

Global unions are international labor organizations that represent workers and their interests
worldwide. These unions work towards promoting workers’ rights, social justice, and equality in the
workplace, regardless of geographical or national boundaries.

Global unions operate at a global level, and they bring together national and regional trade unions
from around the world to coordinate campaigns and actions that affect workers’ interests. These
unions also act as a platform for sharing information and best practices, and they provide training and
support to member organizations to improve their organizing and bargaining skills.

Global unions advocate for workers’ rights and promote decent working conditions through lobbying
and advocacy efforts, international solidarity campaigns, and collective bargaining agreements. They
also collaborate with other civil society organizations and stakeholders to address social and
environmental issues that affect workers’ lives, such as climate change and inequality.

Examples of global unions include the International Trade Union Confederation (ITUC), which
represents over 200 million workers in 163 countries, and Global Union Federations (GUFs), which
are sector-specific unions that represent workers in specific industries such as manufacturing, mining,
and transport.

In summary, global unions are international labor organizations that represent workers’ interests
worldwide, promote workers’ rights and decent working conditions, and coordinate campaigns and
actions that affect workers’ interests. They collaborate with other stakeholders to address social and
environmental issues that affect workers’ lives and work towards a fairer and more equitable global
economy.

6- Regional integration and Framework Agreements

Regional Integration is a process in which neighboring states enter into an agreement in order to
upgrade cooperation through common institutions and rules. The objectives of the agreement could
range from economic to political to environmental, although it has typically taken the form of a
political economy initiative where commercial interests are the focus for achieving broader socio-
political and security objectives, as defined by national governments. Regional integration has been
organized either via supranational institutional structures or through intergovernmental decision-
making, or a combination of both.

Past efforts at regional integration have often focused on removing barriers to free trade in the region,
increasing the free movement of people, labour, goods, and capital across national borders, reducing
the possibility of regional armed conflict (for example, through Confidence and Security-Building
Measures), and adopting cohesive regional stances on policy issues, such as the environment, climate
change and migration.

Intra-regional trade refers to trade which focuses on economic exchange primarily between countries
of the same region or economic zone. In recent years countries within economic-trade regimes such as
ASEAN in Southeast Asia for example have increased the level of trade and commodity exchange
between themselves which reduces the inflation and tariff barriers associated with foreign markets
resulting in growing prosperity.

Regional integration has been defined as the process through which independent national states
“voluntarily mingle, merge and mix with their neighbors so as to lose the factual attributes of
sovereignty while acquiring new techniques for resolving conflicts among themselves.” De
Lombaerde and Van Langenhove describe it as a worldwide phenomenon of territorial systems that
increases the interactions between their components and creates new forms of organization, co-
existing with traditional forms of state-led organization at the national level. Some scholars see
regional integration simply as the process by which states within a particular region increase their
level interaction with regard to economic, security, political, or social and cultural issues.

In short, regional integration is the joining of individual states within a region into a larger whole. The
degree of integration depends upon the willingness and commitment of independent sovereign states
to share their sovereignty. The deep integration that focuses on regulating the business environment in
a more general sense is faced with many difficulties.
Regional integration initiatives, according to Van Langenhove, should fulfill at least eight important
functions:

 The strengthening of trade integration in the region

 The creation of an appropriate enabling environment for private sector development
 The development of infrastructure programmes in support of economic growth and regional
integration
 The development of strong public sector institutions and good governance
 The reduction of social exclusion and the development of an inclusive civil society
contribution to peace and security in the region
 The building of environment programmes at the regional level
 The strengthening of the region’s interaction with other regions of the world.

The crisis of the post-war order led to the emergence of a new global political structure. This new
global political structure made obsolete the classical Westphalian concept of a system of sovereign
states to conceptualize world politics. The concept of sovereignty became looser and the old legal
definitions of the ultimate and fully autonomous power of a nation-state are no longer meaningful.
Sovereignty, which gained meaning as an affirmation of cultural identity, has lost meaning as power
over the economy. All regional integration projects during the Cold War were built on the
Westphalian state system and were designed to serve economic growth as well as security motives in
their assistance to state building goals. Regional integration and globalization are two phenomena that
have challenged the pre-existing global order based upon sovereign states since the beginning of the
twenty-first century. The two processes deeply affect the stability of the Westphalian state system,
thus contributing to both disorder and a new global order.

Regional integration agreements

Regional integration agreements (RIAs) have led to major developments in international relations
between and among many countries, specifically increases in international trade and investment and
in the formation of regional trading blocs. As fundamental to the multi-faceted process of
globalization, regional integration has been a major development in the international relations of
recent years. As such, Regional Integration Agreements has gained high importance. Not only are
almost all the industrial nations part of such agreements, but also a huge number of developing
nations too are a part of at least one, and in cases, more than one such agreement.

The amount of trade that takes place within the scope of such agreements is about 35%, which
accounts to more than one-third of the trade in the world. The main objective of these agreements is to
reduce trade barriers among those nations concerned, but the structure may vary from one agreement
to another. The removal of the trade barriers or liberalization of many economies has had multiple
impacts, in some cases increasing Gross domestic product (GDP), but also resulting in greater global
inequality, concentration of wealth and an increasing frequency and intensity of economic crises.

The number of agreements agreed under the rules of the GATT and the WTO and signed in each year
has dramatically increased since the 1990s. There were 194 agreements ratified in 1999 and it
contained 94 agreements form the early 1990s.

The last few years have experienced huge qualitative as well as quantitative changes in the
agreements related to the Regional Integration Scheme. The top three major changes were the
following:

 Deep Integration Recognition

 Closed regionalism to open model
  Advent of trade blocs

Recent regional integration

Regional integration in Europe was consolidated in the Treaty on the European Union (the Maastricht
Treaty), which came into force in November 1993 and established the European Union. The European
Free Trade Association is a free trade bloc of four countries (Iceland, Liechtenstein, Switzerland and
Norway) which operates in parallel and is linked to the European Union. In January 1994, the North
American Free Trade Agreement was formed when Mexico acceded to a prior-existing bilateral free
trade agreement between the US and Canada. In The Pacific there was the ASEAN Free Trade Area
(AFTA) in 1993 which looked into reducing the tariffs. The AFTA started in full swing in 2000.

Alternative Regional Integration

In the last decade regional integration has accelerated and deepened around the world, in Latin
America and North America, Europe, Africa, and Asia, with the formation of new alliances and
trading blocks. However, critics of the forms this integration has taken have consistently pointed out
that the forms of regional integration promoted have often been neoliberal in character, in line with
the motives and values of the World Trade Organization, the International Monetary Fund and the
World Bank – promoting financial deregulation, the removal of barriers to capital and global
corporations, their owners and investors; focusing on industrialisation, boosting global trade volumes
and increasing GDP. This has been accompanied by a stark increase in global inequality, growing
environmental problems as a result of industrial development, the displacement of formerly rural
communities, ever-expanding urban slums, rising unemployment and the dismantling of social and
environmental protections. Global financial deregulation has also contributed to the increasing
frequency and severity of economic crises, while Governments have increasingly lost the sovereignty
to take action to protect and foster weakened economies, as they are held to the rules of free trade
implemented by the WTO and IMF.

Advocates of alternative regional integration argue strongly that the solutions to global crises
(financial, economic, environmental, climate, energy, health, food, social, etc.) must involve regional
solutions and regional integration, since they transcend national borders and territories, and require
the cooperation of different peoples across geography. However, they propose alternatives to the
dominant forms of neoliberal integration, which attends primarily to the needs of transnational
corporations and investors. Renowned economist, Harvard professor, former senior vice president and
chief economist of the World Bank, Joseph Stiglitz has also argued strongly against neoliberal
globalisation. Stiglitz argues that the deregulation, free trade, and social spending cuts or austerity
policies of neoliberal economics have actually created and worsened global crises. In his 2002 book
Globalization and Its Discontents he explains how the industrialized economies of the US, Europe,
Japan, South Korea and Taiwan developed not with the neoliberal policies promoted in developing
countries and the global South by the WTO, IMF and World Bank, but rather with a careful mix of
protection, regulation, social support and intervention from national governments in the market.