aware to recognize the industries that would developed in the diversified characteristics of the economy, they could make an approach of the industrialization by spending in those industries that have higher probability of succeed, In the developing economies such as in India, regional inequality is a crucial factor of development. It is eminent fact that in a large economy different regions have different abundant resource base in the different region. It leads to the different growth path for the economy over the periods. Therefore, poliey makers preferred decentralized planning instead of centralized planning to deal with the regional disparities. Recently a concept, convergence is emerged to study the growth rate of the economy in behalf of the social welfare. The Convergence theorem (Barro, 1991) hypothesized that as the growth progress of the economy started, the regions with better resources endowments develop more rapidly than the less resource endowments regions. But, as the time passes, law of diminishing returns occurred. It results in convergence of growth rate caused by discrepancy in the marginal productivity of capital in different regions. It is higher in backward regions and lower in advanced regions. This leads to mitigate the gap in the income levels across the regions. However, empirically sometimes this convergence theorem becomes imelevant. In. the presence of market economy, the regions with better infrastructure facilites attract the more foreign investment than the regions with lack of infrastructure facilities. It enhanced the regional disparity between the regions. The regional inequality in China after the post economic reform is a practical example, There are triangle relationships between the economic growth, employment and poverty in a region, The analysis of this relationship is ‘most important factor in the recent economic development. The role of growth on the poverty level influenced the researcher to study this nexus extensively. Hence, the reduction of the poverty level is a key factor of most of the govemments and international institutions like World Bank. The basie purpose of the poverty reduction objective is that it directly linked with the social welfare of the people of an economy. As the poverty reduction increases, it leads to the increase of social well-being in behalf of the poor people in the economy. Therefore, economic growth has been considered as a most vital weapon to reduce absolute poverty. To achieve momentous economic progress and poverty mitigation, in 1980s’ many developing economies accepted structural adjustment reform forward by the Bretton Woods institutions. Adoption of flexible exchange rate policies and opening up of international trade are the major initiative under the reform, These policies attract the foreign investment that helps to promoted economic growth. Similarly, World Bank also forwarded a reform to alleviate poverty level, It involves the investment on human capital, environmental issues, and privatization of government personal enterprises and economic progress in the economy. There are numbers of determinants of poverty in the economy. The most important feature of the economic growth is that ifthe growth occurred in favor of poor people it helps to increase the employment growth among the poor people in the economy. It leads to increase the income of the poor. The increase of employment opportunities results in reduction of the poverty level in the economy. This is because earnings facilitated the poor to aecess the basic au (CU IDOL SELF LEARNING MATERIAL (SLM)amenities for livelihood, Therefore, because of this relationship, the key purpose of the researcher is to study the employment growth ofa region in a depth manner (Nayyar, 2005), The study of employment opportunities has various dimensions, In general, the decision of employment generation is depends upon both private and government sector. Private sector always motivated by the profit while government sector do it in behalf of distributional aspect of the people in the economy. It implies that to enhance the welfare of the society, government required to take active role. However, in the process of economic expansion, employment growth is take place in both the sectors. Therefore, one can viewed that employment growth is determined by planned output as well as distributional purpose of the society. Since, the private sector is guided by the profit motive; hence it is the responsibility of the government to enhance the employment growth in the society, Basically, government required to focus on the employment growth of poor people, because it increases their earnings and helps them to release from the poverty level (Theodore, 2009). India is an underdeveloped country in the world, It is characterized by the high unemployment rate, higher amount of population, lack of capital formation etc. Th € whole country divided into different regions such as southem region, eastern region ete, North Easter Region (NER) is, one of them. The NER of India is a region that diversified in characteristics. The whole region is characterized by the lack of infrastructure, lower level of per capita power availability, lower state growth rate, lower amount of employment growth ete. The region has been ignored since the Colonial periods. In the British Colonial periods, Assam was the basic source of resource exploitation to the British. They developed the infrastructure fx such as railway track only at the place from where they ean carry the resources of the region. However, some states of the NER were the part of Assam at this period, The NER of India has the tremendous amount of resources. The whole region has the potential to grow and compete with the rest of the region of India, Unfortunately, the region is lacks behinds the other developed region of the country. There are eight states in the NER of India, Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura, Each states of the region have different features that influenced the growth rate of each state of the region. The most of the population of the whole region is living in the rural areas. In the rural areas, people are basically belongs to poor. They engaged in the activities that are accessible to them. Their basic wealth is only labour hours that used as a source of income. Except the labour hour, they do not have significant wealth. Therefore, the employment growth of the whole NER of India is a key factor to reduce the poverty level. It is because, as mentioned by the earlier researcher, as employment growth takes place among the poor people in a region, it leads to increase the income opportunities to the poor people of that region, So, the study of the employment growth in the NER of India is important to reduce the poverty level. The present paper focused on the study of employment growth in the manufacturing industry in the North Eastem Region of India. The whole paper consists of seven sections, After the introduction of the paper, next section provides the existing research on the topic of the paper. Third section forwards the objective and data source of the paper. In the fourth section, 212 (CU IDOL SELF LEARNING MATERIAL (SLM)author discussed about the methodology of the paper. The present paper applied the shift share technique that used to study the growth rate ofa variable between the periods. In the fifth section, the paper estimates the data and provides the results. In the sixth section, author forward some suggestions regarding the study area and variable. Finally, in the last section, author concluded the research, Existing literature: The study of existing research is important to understand the present scenario of an economy. It is also required to understand the methodology of the research, There are lots of researches in favor of economic growth, employment growth, manufacturing industry and shift share analysis. Bhattacharya and Sakthivel (2004) studied the comparison of regional growth and disparity between the pre reforms and post reforms periods in India, The study analysed the relationship between the growth rate and population and found that poorer state with higher population growth shows less SDP growth in the 1990s period. Again, the study also found that population growth did not highly influenced in the 1980s period. Similarly, the study also estimated the SDP growth for different sectors of 17 rich and poor states in India during the analysis periods, Nayyar (2008) discussed the regional inequality and economic growth in India. The author studied the growth of the 16 major states of India for the periods 1978-79 to 2002-03. The study found that in the steady state levels of income, the states are not converging to identical levels of per capita income, The poor states grow more rapidly than the rich states when the factors of steady state income are controlled. Again, the research also found that per capita income scattered across states over the analysis periods, Marr and Whitney (1983) discussed the regional growth in Canada for the periods 1951-61 and 1961-71. The author also applied the technique to estimate the various industrial growths in the various regions during the periods. The study also estimated the allocation of labor shift of the different regions. Chaube et.al (1975) discussed the regional development of North Eastern Region of India. The paper estimated the economic: OBJECTIVES OF THE NATIONAL MANUFACTURING PLAN In the light of the above discussion, India’s strategic objectives for the manufacturing sector in the next 15 years should be to bring about a quantitative and qualitative change via a set of policy choices with the following five core objectives: i, Increase manufacturing sector growth to 12-14% over the medium term to make it the engine of growth for the economy. The 2 to 4% differential over the medium term growth rate of the overall economy will enable ‘manufacturing to contribute at least 25% of the National GDP by 2025. ii, Increase the rate of job creation in manufacturing to create 100 million additional jobs by 2025, Emphasis should be given to creation of appropriate skill sets among the rural migrant and urban poor to make growth inclusive. iti, Increase ‘depth’ in manufacturing, with focus on the level of domestic value addition, to address the national strategic requirements, iv. Enhance global competitiveness of Indian manufacturing through appropriate policy support. v. Ensure sustainability of growth, particularly with regard to environment. 213, (CU IDOL SELF LEARNING MATERIAL (SLM)THE STRATEGY FOR DEVELOPMENT OF MANUFACTURING SECTOR A close look at the impact of the policies adopted by India since 1990 shows that while the performance of some sub-sectors of manufacturing e.g. automobiles and auto parts, has improved, overall manufacturing has failed to contribute to the economy as much as expected. In fuet India’s growth has been, unusually fiom economists” perspective, service led. The relatively weak growth of the manufacturing sector against expectations of contributions from it, and the contrast with the rapid growth of manufacturing in other countries during the lif-offs of their economic growth, China in particular, compels a re- thinking of strategy. While clearly the country must not revert to the system of government controls from which industry was freed by liberalization, government must shape policies to stimulate faster and broader growth of manufacturing. There are constraints on manufacturing growth that the first wave of reforms has not addressed adequately so far, such as infrastructure, Also, the more open global trade regime since the 1990s requires new approaches and mote sophisticated policies to grow depth in Indian manufacturing. Protection will not do, but neither can we go on as we are, Investments must be attracted to ‘manufacturing sectors that will provide the country with the benefits it needs, of rapid growth of employment, technological development and depth in sectors that are strategically important—some for the security of the country, others for the base they provide for ining the competitiveness of the manufacturing sector. Just as policymakers make choices about what types of transport infrastructure would be best to promote in the country, not leaving this entirely to the market, and make assessments of which types of renewable energies it will be desirable to promote considering the country’s resource endowments, they must consider which types of manufacturing industries are desirable to promote to achieve the outcomes expected from the growth of the manufacturing sector. The integrated development of the Manufacturing sector also requires an appreciation of the trade-off8 to be made to develop manufacturing more systemically. A national Manufacturing Plan cannot be merely an aggregation of policies for sub-sectors of Manufacturing, The country is developing and implementing fairly successful policies for sub-sectors such as automobiles. However, the connection of these policies with the growth of other critical sectors, such as machine tools is insufficiently understood until the whole of Manufacturing is considered together. Similarly, policies for the power sector and telecom sector effect the growth of the manufacturing capabilities required to support the growth of those sectors, Therefore a more holistic view must be taken. For this, the participation of several ministries and several sectors of industry is necessary. Sustainable growth of the manufacturing sector will be achieved by the growth of internationally competitive enterprises in the country. ‘Therefore the policy-makers’ role is to create conditions for the growth of such enterprises, This requires that constraints within the country on their growth and competitiveness must be addressed, Recent analysis by economists of countries that grew their manufacturing sectors rapidly show that the strength of the process of collaboration between producers (in the private sector as well as public sector if significant) and policy-makers has been the key to sus 214 (CU IDOL SELF LEARNING MATERIAL (SLM)the evolution of appropriate strategies and policies. These analyses of the successful growth of the manufacturing sector in several countries highlight the quality of the process of learning that results in “getting it right”, The manufacturing sector is complex. Not only are there inter-relationships between its sub-sectors as mentioned before. Several constraints affect the sector, such as infrastructure, labor policies, ete, It is not necessary to relieve them all at the same time; but to relieve those that, stitutions, technology acquisition, trade at that stage of development of the sector in the country, are the most binding constraints; and to relieve them in contextually appropriate ways. In other words, each country that successfully grew its manufacturing sector developed innovative solutions to overcome its constraints, Mere imitation of other countries’ solutions cannot work, Producers in the country who know where exactly the shoe pinches and policy-makers have to devise solutions together, In sum, the quality of the process of consultation and policy-formulation is the key to a good industrial strategy/policy for the 2Ist century. Indeed, some suggest that, in a dynamic world in which strategy and policy must respond dynamically, to build a strong the best strategy. process for consultation to evolve policies THE COMPONENTS OF THE MANUFACTURING PLAN In line with the architecture suggested above the National Manufacturing Plan will have three components, namely: 1 Special focus on some sectors of manuficturing which will enable the country to more rapidly achieve its goals for manufacturing and strengthen the overall manufacturing sector. This focus may shift over time as new threats and opportunities emerge. 2. An identification of the constraints that cut across manufacturing sectors, and policies to relieve these constraints, The constraints that need most attention at the time, and the policies to relieve them, must be developed through effective processes for consultation between stakeholders and policy makers. Since many stakeholders are involved, and various ministries in government too, a nodal agency must be accountable to coordinate the evolution of the policy in each area and to manage its progress within the overall Plan, 3. Active attention to improving the processes of implementation. Consultation between policy-makers and producers are required within each of the policy-areas, as well as for overall co-ordination since the various sectors and policy areas interact systemically. Accountability. for development of the overall framework and also accountability for coordination of its implementation must be appropriately and clearly located Growth in the region for the periods 1961 and 1971. The analysis also viewed the diversified characteristics in the different parts of the region, Paraskevopoulos (1974) estimated the regional growth of manufacturing industry in Canada for the two time periods from 1949-59 and 1961-67, The author also discussed the regional employment growth pattern at the regional and country level. The research applied the shift share technique to study the growth. Similarly, Houston (1967) also studied the regional growth of shift share technique. The research critically discussed the components of shift share technique. The research criticized 21s (CU IDOL SELF LEARNING MATERIAL (SLM)that estimation of shift component from the aggregate data is different from the disaggregated data. The author viewed that as the industrial sectors enlarged the competitive component of the technique tends to vanish. Again, Curtis (1972) estimated the income changes of different components of income sources for four rural countries in Alabama during the periods from 1960 to 1969. The research also estimated the employment change in the different indus and government sector for four rural countries in Alabama during the same periods. The study applied the shift-share method of estimating regional growth to estimate the objective. Similarly, Dasgupta (1998) discussed the employment growth in the manufacturing industries of eight rich and poor states of India during the periods from 1965-66 to 1970-71 and 1970- 71 to 1977-78. The study also viewed the value added by the considered industry in the considered states during the periods 1970-71 to 1977-78. The author included the additional components of shift share technique on the paper over what does Stevens and Moore (1980), Objective & Data source: The North Eastern Region of India consists of different industries The employment growth may differ for different industries in the region. It is because of possession of different characteristics by the region in favor of different industries. The objective of the present paper is to estimate the absolute numbers of the employment growth in the manufacturing industry in the North Eastern Region of India, The author to estimate the employment growth collected the data from the secondary source, Census of India, The author considered the time periods from 2001 to 2011, METHODOLOGY: The author applied @ method that used to estimate the regional growth rate of a variable such as regional food production growth rate, employment growth rate etc. in the economy. The method famous as a shift share technique. The present paper applied the method to estimate the employment growth in the manufacturing industry in the NER of India during the analysis periods. Initially, the technique was formulated by the Daniel Creamer in 1940s, The author in the present paper applied the technique forward by the Stevens and Moore (1980) to find out the absolute numbers of the employment growth, Read the case given below and answer the questions given at the end: ‘The National Manufacturing Company reached an agreement with its Union on a production incentive scheme to increase production. The Company had an unprecedented demand for its goods and the Union agreed for the incentive scheme, The management was pleased with the assurance of the Union leader to personally undertake the task of implementing the scheme. The management promised to give him a free hand if he could inerease the production. The Union did increase production to almost double the original level, As a result, the Union gained importance, Any problem could be sorted out by the Union by its direct access to the chief executive. The management staff as a result became wary of its interaction with the Union, Non-members of the Union were discriminated by the Union. Its members could get special favours like disposal of their grievances, promotions, and so on, The incentive scheme benefitted primarily the Union members. The scheme was inequitable as 216 (CU IDOL SELF LEARNING MATERIAL (SLM)some workers got disproportionately large incentives, some low and some no incentive at all ‘The second feature was that as the incentive was linked to the Consumer Price Index (CPI) the distortion got further accentuated. However, when the Union tried to misuse its new found powers the management struck back one day by taking disciplinary actions against all the leaders and the Union found all of a sudden that it was without a leader. Another Union arrived on the scene and the leader had established rapport with the chief executive and this new Union faithfully followed the tenets of the management but as a price extracted some benefits for its members exclusively. It had a say on all aspects of the management function like recruitment, selection, transfers, job classification, and so on. In return the Union saw to it that production became its exclusive responsibility and it had a hot line with the chief executive for any problem resolution, Again the management became wary that their path should not cross the path of the Union resulting in a confrontation, As the years passed, the Union started agitating for improvement in the wage scales. Because of the incentive scheme, the company found that any improvement in the basie wage would pose greater problems and the primary question before the management was to delink the CPI from the incentive scheme, The Union refused to delink the CPI from the incentive scheme as some of its members were caring an amount equal to, if not more than, the salary as an incentive itself. At the same time workmen with no incentive and being grade barred began to lose. And this resulted in discontentment amongst the workmen, But the dilemma could not be resolved and this led to an explosive situation, A third Union emerged on the seene and this led to intense inter - Union rivalry resulting in indiscipline, loss of production, and violence within the factory premises, as a result of which the company declared a lockout When the plant reopened after four months, the Union in power lost its credibility and the new Union had the complete support of the workmen, In the meanwhile, the new HR Manager who joined the company during this period of strife found that a new approach to deal with the problem was very helpful. Normaley in discipline and production seemed to return when a realistic approach of meeting the workmen for resolving problems and difficulties was made by the HR Manager and the Plant Manager. Simultaneously contact with workmen led to the formation of committees to look after various matters relating to the canteen, working conditions, and welfare functions, The management also withdrew at the instance of the HR Manager, charge - sheets which were in force for over two to three years. The abuse of discretion by the old Union leaders was also rectified. This had an immediate effect and the workmen responded favourably and they even admitted that there was somebody to look into the problems of the workmen, The new Union leader was happy that the management could develop a rapport not only with the leader but even the workmen and hoped that it could expect the management to rectify the defect of not having revised the wage scales. But this was not an easy task as there were a lot of inequalities that the management wanted to set right. The Union, though agreeing with the management, would not agree for a cut in the wages in any manner to set right the inequalities. The Union not only wanted to cling to the beneficial aspects of the incentive scheme but also. Insisted that 217 (CU IDOL SELF LEARNING MATERIAL (SLM)the management somehow give an increase in the basic wages. The management was being drawn into a vicious circle of the incentive scheme being inequitable, but when the Union's attention was being brought to the high incentive categories it reverted to the low basic wage theme. The management remained in a quandary as regards how to convince the workmen, to win over the constituency of workmen, and make managers effective and regain supremacy in production, Questions: (a) Identify the problems and their eauses in the case. (b) Under the given situation, how are the problems to be remedied? (0) Suggest various principles and strategies the management has to keep in mind while formulating a wage incentive scheme for the employees. CASE STUDY 2 Business Situation An India based automotive manufacturing company was in the process of a large-scale expansion, Due to space constraints, the Machine shop, CNC machines and the Gear Box. Assembly Line were shifted to a hired place (Unit 2), away from the main plant. The workers for this manufacturing activity are also transferred along with managerial staff Challenge ‘The company was looking for financial services help — they needed a firm to independently ‘manage the material accounting for Unit 2, so the company could focus on their core manufacturing activities, Our Services and Solution The company gave a detailed situation brief to Team Leaver’s trained and experienced accounting professionals, The Team was also given a tour of Unit 2 so they could understand the entire process. The Team identified all areas which could be outsourced, Based on the study the following processes were outsourced to Levare: ‘+ The entire material accounting activity at the new site + Receipt of castings and components required for machining and assembly of Gear Boxes + Physical verification of the material received and reporting of any discrepancies to the main plant ‘+ Issue of material to production based on the daily production plan 218 (CU IDOL SELF LEARNING MATERIAL (SLM)‘+ Dispatch of Gear boxes manufactured at Unit 2to the main plant based on the daily schedules ‘+ Maintenance of records for the purpose of Excise authorities, including filing of monthly returns + Continuously updating management regarding all transactions at Unit 2 Results and Benefits ‘+ The company can concentrate on manufacturing ~ its core activity + The company can eliminate its separate store and excise department at Unit 2 + The company receives a continuous information update about material consumption, including production wastage at Unit 2 ‘+All material discrepancies are promptly identified, communicated, and investigated ‘+ The company achieved significant savings in Unit 2 staff costs, which were higher than Leaver’s professional fees CASE STUDY -3 ‘The National Manufacturing Company CAST STUDY solution Read the case given below and answer the questions given at the end: The National Manufacturing Company reached an agreement with its Union on a production incentive scheme to increase production. The Company had an unprecedented demand for its goods and the Union agreed for the incentive scheme, The management was pleased with the assurance of the Union leader to personally undertake the task of implementing the scheme. The management promised to give him a fee hand if he could inerease the production, ‘The Union did increase production to almost double the original level. As a. result, the Union gained importance, Any problem could be sorted out by the Union by its direct access to the chief executive. The management staff as a result became wary of its interaction with the Union, Non-members of the Union were discriminated by the Union. Its members could get special favours like disposal of their grievances, promotions, and so on. The incentive scheme benefitted primarily the Union members, The scheme was inequitable as some workers got disproportionately large incentives, some low and some no incentive at all The second feature was that as the incentive was linked to the Consumer Price Index (CPI) the distortion got further accentuated. However, when the Union tried to misuse its new found powers the management struck back one day by taking disciplinary actions against all the leaders and the Union found all of a sudden that it was without a leader. Another Union arrived on the scene and the leader had established a rapport with the chief executive and this new Union faithfully followed the tenets of the management but as a price extracted some benefits for its members exclusively. It had a say on all aspects of the management function like recruitment, selection, transfers, job classification, and so on. In 219 (CU IDOL SELF LEARNING MATERIAL (SLM)return the Union saw to it that production became its exclusive responsibility and it had a hot line with the chief executive for any problem resolution. Again the management became wary that their path should not cross the path of the Union resulting in a confrontation. As the years passed, the Union started agitating for improvement in the wage scales. Because of the incentive scheme, the company found that any improvement in the basic wage would pose greater problems and the primary question before the management was to delink the CPI from the incentive scheme. The Union refused to delink the CPI from the incentive scheme as some of its members were eaming an amount equal to, if not more than, the salary as an incentive itself. At the same time workmen with no incentive and being grade barred began to lose. And this resulted in discontentment amongst the workmen, But the dilemma could not be resolved and this led to an explosive situation, A third Union emerged on the scene and this led to intense inter - Union rivalry resulting in indiscipline, loss of production, and violence within the factory premises, as a result of which the company declared a lockout When the plant reopened after four months, the Union in power lost its credibility and the new Union had the complete support of the workmen, In the meanwhile, the new HR ‘Manager who joined the company during this period of strife found that a new approach to deal with the problem was very helpful. Normaley in discipline and production seemed to return when a realistic approach of meeting the workmen for resolving problems and difficulties was made by the HR Manager and the Plant Manager. Simultaneously contact ‘with workmen led to the formation of committees to look after various matters relating to the canteen, working conditions, and welfare functions. The management also withdrew at the instance of the HR Manager, charge - sheets which were in force for over two to three years. The abuse of discretion by the old Union leaders was also rectified. This had an immediate effect and the workmen responded favourably and they even admitted that there was somebody to look into the problems of the workmen, The new Union leader was happy that the management could develop a rapport not only with the leader but even the workmen and hoped that it could expect the management to rectify the defect of not having revised the ‘wage scales. But this was not an easy task as there were a lot of inequalities that the management wanted to set right. The Union, though agreeing with the management, would not agree for a cut in the wages in any manner to set right the inequalities. The Union not only wanted to cling to the beneficial aspects of the incentive scheme but also. Insisted that the management somehow give an increase in the ba drawn into a vicious circle of the incentive scheme being inequitable, but when the Union's attention was being brought to the high incentive categories it reverted to the low basic wage theme, The management remained in a quandary as regards how to convince the workmen, to win over the constituency of workmen, and make managers effective and regain supremacy in production, c wages. The management was being Questions: (a) Identify the problems and their causes in the case. 20 (CU IDOL SELF LEARNING MATERIAL (SLM)(b) Under the given situation, how are the problems to be remedied? (©) Suggest various principles and strategies the management has to keep in mind while formulating a wage incentive scheme for the employees. 8.4 SUMMARY © Inspite of the fact that large number of labour laws have been enacted and the Indian labour scene is crowded with various complex judicial formalities and legalities and the court has to play a peaceful role * The labour management relations have been shattered and the expected workers involvement has not been adequately achieved. * A code of discipline has been laid down to maintain harmonious relations and promote industrial peace. It applies to both public and private sector enterprises and aims to secure the settlement of disputes and grievances by a mutually agreed procedure. * Ttspecifies various obligations for the management and the workers with the objective of promoting cooperation between their representatives. This code of discipline requiring the employers and workers to settle disputes making use of the existing machinery and abstaining from taking direct action was evolved at the Indian Labor Conference in 1958, * Discipline is essential for any successful activity and, where it refers to industrial discipline, it essentiality gets an added value, In industrial organizations, discipline is ‘a must, The condition of complete peace and harmony as opposed to chaos is a very important factor for the success of an industrial unit. + In an atmosphere of discipline, work environment improves productivity of labour increases, production gears up and the organization, as a whole, attains prosperity and achieves its objectives and goals. Discipline may be self-imposed or enforced. In the case of self-imposed discipline, employees regulate themselves and their conduct but, in enforced discipline, regulation comes from the top. * The COD js a goverment induced self-imposed and mutually agreed voluntary principle of discipline and relations between management and workers in industry. It aims at preventing disputes by providing voluntary and mutually agreed settlement of disputes through negotiations and conciliation, voluntary arbitration without the interference of an outside agency. The code has been aimed at establishing cordial 21 (CU IDOL SELF LEARNING MATERIAL (SLM)relations between management and workers on a voluntary basis to promote harmony ‘and to put an end to industrial unrest. The objective is to ensure a smooth transition between employers and employees, wherein each party recognises the rights and obligations towards each other and the society. It also helps constructive cooperation between both the parties to secure and settle disputes, grievances by negotiations, conciliation and voluntary arbitration, 8.5 KEY WORDS + Regional Employment — Employment generated locally + Manufacturing Industry ~ fabrication, processing, + NER of India ~ North Eastern Region + Code of Discipline — principles to follow + Industrial Unrest-A state of disagreement between employers and employees, resulting in action taken by employees as a protest, 8.6 LEARNING ACITIVITY 1. Importance of Code of Discipline in the industry. 2. Understand the concept, meaning and importance of National manufacturing Co ease study 8.7 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Definition of Industrial Discipline 2. Types of Industrial Discipline 3. Causes of Indiscipline 4, Codes 5. How to Maintain Industrial Discipline? Long Questions (CU IDOL SELF LEARNING MATERIAL (SLM)1. Define and explain the concept of industrial discipline + 2.Explain the meaning of misconduct 3. Identify the steps to be taken when exercising the power to take disciplinary action against erring workman. 4, Objectives of National Manufacturing Discipline 5.Which are the ways that are adopted to maintain industrial discipline? Explain in detail B. Multiple choice Question 1. Recognition of the trade union in industry under the code of disei the year ine was developed in a. 1952 b. 1957 ec. 1958 4. 1962 2. Majority of industrial disputes are settled by which of the following machinery in India? a. Conciliation Machinery b. Arbitration Machinery Adjudication Machinery None of these 3.Which of the following is the meaning of “Cooling off” period in industrial relations? a. Workers to have bath after long hours of work with cold water b. Notto be annoyed at the place of work. To have a proper spirit of implementing agreements, 4. The period from ser strike in order to think coolly whether the workers should go on a strike or not. ng the notice of strike and the date of resorting to a 4, Which one of the following is not a subject matter of industrial relations? a. Trade Union and Collective Bargaining 23 (CU IDOL SELF LEARNING MATERIAL (SLM)b, Strikes and Lockouts ¢. Unfair Labour Practices 4. Employee Compensation and Welfare 5.Which among the following includes data concerning family background and educational development? a. Case Study b. Code of Discipline ©. General Behaviour study 4. Allofthese Answers 1 -b, 2-0, 3-d,4-4,5—a 8.8 REFERENCES Text Books + Employee complaint handling ~ Charles Boyd + The Employers guide to Grievance and Disciple procedure ~ Mike Parkin * Workplace investigation ~ Lisa JD Reference Books — * Agyemang, Eric (2014), ‘Economic growth, income inequality and poverty reduction’ a regional comparative analysis’, University of Let bridge Research Repository, available at https:/*hdl.handle.net/10133/3635. 2. Ahluwalia, M.S. (2000), ‘Economic Performance of States in the Post-Reforms Period’, Economic & Political Weekly, Vol. 35, No. 19. 3. Barff, Richard A. and Prentice L. Knight III (1988), ‘Dynamic Shift Share Analysis’, Growth and Change, Vol.19, No.2, pp.1- 10. 4, Bhattacharya, BB. and Sakthivel, S. (2004), ‘Regional Growth and Disparity in India: Comparison of Pre- and Post-Reform Decades’, Economic and Political Weekly, Vol. 39, No. 10, pp. 1071-1077 Website ‘© https:/'www egyankosh.ac.inbitstreamy/123456789/6928//Unit-17.paf # hup://arts.brainkart comvarticle/code-of-discipline-in-the-indian-industry-—managing- diseipline-844) 224 (CU IDOL SELF LEARNING MATERIAL (SLM)UNIT - 9: INDUSTRIAL DISPUTES- CODE OF DISCIPLINE STRUCTURE 9.0 LearningObjectives 9.1 Introduction 9.2 Industrial Employment (Standing Orders) Act, 1946 9.3 Summary 9.4 Keywords 9.5 Learning Activity 9.6 Unit End Questions 9.7 References 9.0 LEARNING OBJECTIVES After studying this unit, you will be able to: + Objectives and importance of Code of Discipline * Definition for Standing order committee 9.1 INTRODUCTION A code of discipline has been lad down to maintain harmonious relations and promote industrial peace. It applies to both public and private sector enterprises and aims to secure the settlement of disputes and grievances by a mutually agreed procedure. It specifies various obligations for the management and the workers with the objective of ig the employers and workers to settle disputes making use of the existing machinery and abstaining from taking direct action was evolved at the Indian Labor Conference in 1958 promoting cooperation between their representatives. This code of discipline req ‘The Code is Applicable to: 1. All Central Organizations of Employers and workers, (except those under Ministry of Defence, Railways, Ports and Docks.) 2. Insurance industry. 3. The State Bank of India. (CU IDOL SELF LEARNING MATERIAL (SLM)4, The Reserve Bank of India, Committees have set up by a few of these organizations, to screen cases for dissuading the affiliate members form filing appeals in higher courts in order to honor the Code of Discipline, Basic Objectives of the Code of Discipline: The Basic Objectives of Code of Discipline are to: 1. Maintain peace and order in industry. 2. Facilitate a free growth of trade unions 3. Promote constructive criticism at all levels of management and employment 4, Eliminate all forms of coercion, intimidation and violations of rules and regulations, governing industrial relations, 5. Avoid stoppage of work in industry. 6. Avoiding litigations ‘The Code of Discipline Ensures that: 1. There should be no strike or lock-out without prior notice 2. No deliberate damage should be caused to a plant or property 3. Acts of violations, intimidation and coercion should not be resorted to, 4, Actions that disturb cordial relationships should be avoided 5. No unilateral action should be taken in connection with any industrial matter. 6. The existing machinery for the settlement of disputes should be utilized. To ensure better discipline in industry, management and unions agree to abstain from indulging in violation of rules and regulations. Actions having Mutual Agreement of Management and Union: 1. That there should be no strike or lock-out without prior notice, 2. That no unilateral action should be taken in connection with any industrial matter and that should be settled at appropriate level 26 (CU IDOL SELF LEARNING MATERIAL (SLM)3. That they will avoid litigation, sit-down and stay-in strikes and lock-outs 4. that neither party will have recourse to coercion, intimidation, victimization or go -slow tactics, 5. that the existing machinery for settlement of disputes should be utilized with the utmost efficiency. 6. that they will formulate a mutually agreed grievance procedure which will ensure a speedy, sation leading to a time bound settlement and comprehensive inves 7. that they will abide by the various stages in the grievance procedure and take no arbitrary action which would by-pass this procedure 8. that they will promote constructive co-operation between their representatives at all levels, and as between workers themselves Actions Agreed to by the Management: 1. Not to increase workloads unless agreed upon or settled otherwise. 2. Not to support or encourage any unfair labor practice such as, victimization of any employee. 3. To take prompt action for settlement of grievances and implementation of settlements, awards, decision and orders. 4. To take appropriate disciplinary action against its officers and members in cases enquiries reveal that they were responsible for precipitate action by workers leading to indiscipline Actions Agreed to by the Union: 1. Abstain from resorting to violent demonstrations. 2. Not to engage in any form of physical duress. 3. To discourage unfair labor practices such as negligence of duty, damage to property and insubordination 4. To take prompt action to implement awards, agreements, settlements and decisions, 5. Abstain from instigating the employe hours. to engage in any union activity during working 27 (CU IDOL SELF LEARNING MATERIAL (SLM)Provisions in the Code of Discipline: All central organizations of employees and workers have voluntarily accepted the *Code of Discipline’ applicable in Indian Industry. This code of Discipline applied both to the public as well as the Private sector. According to the Code of Discipline, it is Mandatory: (i) To lay down a regular grievance procedure in every organization, (ii) Bach grievance should be promptly redressed by legal means and through the normal channels, There should be no direct, arbitrary or unilateral action on either party, (iii) To avoid litigation, lock-outs and strikes (sit-down and stay in) intimidatio victimization or delaying tacties should be avoided. (iv) Unfair practices like negligence of duty, damage to property and physical stress should be discouraged. (v) Management should give workers the freedom to form trade unions. (vi) Management should promptly implement awards, agreements, settlements and policy decisions, (vii) The trade unions should fianction in a democratic fashion and discourage violence, casteism, communalism, provincialism, intimidation or personal deformation in inter-union. dealings. ‘A machinery for implementation and evaluation has been set up at the center and state level to ensure that the obligations outlined in laws, agreements and the code of Discipline are observed by both management as well as labor, 9.2 INDUSTRIAL EMPLOYMENT (STANDING ORDERS) ACT, 1946 Short title, extent and application.-(1) This Act may be called The Industrial Employment (Standing Orders) Act, 1946, (2) It extends to [the whole of India] [* * *] [(3) It applies to every industrial establishment wherein one hundred or more workmen are employed, or were employed on any day of the preceding twelve months: Provided that the appropriate Government may, after giving not less than two months ‘notice of its intention so to do, by notification in the Official Gazette, apply the provisions of this Act to any industrial establishment employing such number of persons less than one hundred as may be specified in the notification.) 28 (CU IDOL SELF LEARNING MATERIAL (SLM)[rey [(4) Nothing in this Act shall apply to- (i) Any industry to which the provisions of Chapter VII of the Bombay Industrial Relations Act, 1946 (Bombay Act 11 of 1947), apply; or (ii) Any industrial establishment to which the provisions of the Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961 (26 of 1961), apply: Provided that notwithstanding anything contained in the Madhya Pradesh Industrial Employment (Standing Orders) Act, 1961 (26 of 1961), the provisions of this Act shall apply to all industrial establishments under the control of the Central Government} Object & Reasons 2. Interpretation.-In this Act, unless there is anything repugnant in the subject or context,- [(a) "appellate authority "means an authority appointed by the appropriate Government by notification in the Official Gazette to exercise in such area as may be specified in the notification the functions of an appellate authority under this Act: Provided that in relation to an appeal pending before an Industrial Court or other authority immediately before the commencement of the Industrial Employment (Standing Orders) Amendment Act, 1963 (39 of 1963), that Court or authority shall be deemed to be the appellate authority:] (b) “appropriate Government "means in respect of industrial establishments under the control of the Central Government or a [Railway Administration] or in a major port, field, the Central Government, and in all other cases, the State mine or Government: [Provided that where any question arises as to whether any industrial establishment is under the control ofthe Central Government, that Government may, either on a reference made to it by the employer or the workman or a trade union or other representative body of the workmen, of on its own motion and after giving the parties an opportunity of being heard, decide the question and such decision shall be final and binding on the parties:] [(c) "Certifying Officer "means a Labour Commissioner or a Regional Labour ‘Commissioner, and includes any other officer appointed by the appropriate Government, by notification in the Official Gazette, to perform all or any of the functions of a ing Officer under this Act; } (@) "Employer "means the owner of an industrial establishment to which this Act for the time being applies, and includes- (9) Ina factory, any person named under [clause () of sub-section (1) of section 7 ofthe Factories Act, 1948 (63 of 1948), as manager of the factory; 29 (CU IDOL SELF LEARNING MATERIAL (SLM)(i) in any industrial establishment under the control of any department of any Government in India, the authority appointed by such Government in this behalf, or where no authority is so appointed, the head of the department; (iii) In any other industrial establishment, any person responsible to the owner for the supervision and control of the industrial establishment; (e) "Industrial establishment "means- (i) An industrial establishment as defined in clause (ii) of section 2 of the Payment of Wages Act, 1936 (4 of 1936), or [(ii) A factory as defined in clause (m) of section 2 ofthe Factories Act, 1948 (63 of 1948),] or (iii) A railway as defined in clause (4) of section 2 of the Indian Railways Act, 1890 (9.0f 1890), or (iv) The establishment ofa person who, for the purpose of fulfilling a contract with the owner of any industrial establishment, employs workmen; (0) "Prescribed "means prescribed by rules made by the appropriate Government under this Act; (g) "Standing orders "means rules relating to matters set out in the Schedule; (b) "trade union "means a trade union for the time being registered under the Indian Trade Unions Act, 1926 (16 of 1926); [G) "wages "and "workman "have the meanings respectively assigned to them in clauses (rr) and (s) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947).] 3. Submission of draft standing orders .-(1) Within six months from the date on which this Act becomes applicable to an industrial establishment, the employer shall submit to the Centfying Officer five copies of the draft standing orders proposed by him for adoption in his industrial establishment (2) Provision shall be made in such draft for every matter set out in the Schedule which may be applicable to the industrial establishment, and where model standing orders have been prescribed, shall be, so far as is practicable, in conformity with such model. (3) The draft standing orders submitted under this section shall be accompanied by a statement giving prescribed particulars of the workmen employed in the industrial establishment including the name of the trade union, if any, to which they belong, (4) Subject to such conditions as may be prescribed, a group of employers in similar industrial establishments may submit a joint draft of standing orders under this section, 4. Conditions for certification of standing orders.-Standing orders shall be certifiable under this Act, if 230 (CU IDOL SELF LEARNING MATERIAL (SLM)(a) Provision is made therein for every matter set out in the Schedule which is applicable to the industrial establishment, and (b) The standing orders are otherwise in conformity with the provisions of this Act, and it [shall be the function] of the Certifying Officer or appellate authority to adjudicate upon the faimess or reasonableness of the provisions of any standing orders. 5. Certification of standing orders -(1) On receipt ofthe draft under section 3, the Centifying Officer shall forward a copy thereof to the trade union, ifany, of the workmen, or where there is no such trade union, to the workmen in such manner as may be preseribed, together with a notice in the prescribed form requiring objections, ifany, which the workmen may desire to make to the draft standing orders to be submitted to him within fifteen days, from the receipt ofthe notice. (2) After giving the employer and the trade union or such other representatives of the ‘workmen as may be prescribed, an opportunity of being heard, the Certifying Officer shall decide whether or not any modification of or addition to the draft submitted by the employer is necessary to render the draft standing orders certifiable under this Act, and shall make an. order in writing accordingly. (3) The Certifying Officer shall thereupon certify the draft standing orders, after making any modifications therein which his order under sub-section (2) may require, and shall within seven days thereafter send copies of the certified standing orders authenticated in the prescribed manner and of his order under sub-section (2) to the employer and to the trade union or other prescribed representatives of the workmen, 6. Appeals -(1) [Any employer, workman, trade union or other prescribed representatives of the workmen] aggrieved by the order of the Certifying Officer under sub-section (2) of section $ may, within [thirty days] from the date on which copies are sent under sub-section (3) of that section, appeal to the appellate authority, and the appellate authority, whose decision shall be final, shall by order in writing confirm the standing orders either in the form fied by the Certifying Officer or after amending the said standing orders by making such modifications thereof or additions thereto as it thinks necessary to render the standing orders fiable under this Act. (2) The appellate authority shall, within seven days of its order under sub-section (1), send copies thereof to the Certifying Officer, to the employer and to the trade union or other prescribed representatives of the workmen, accompanied, unless it has confirmed without amendment the standing orders as certified by the Certifying Officer, by copies of the standing orders as certified by it and authenticated in the prescribed manner. cert cert 7. Date of operation of standing orders.-Standing orders shall, unless an appeal is preferred. under section 6, come into operation on the expiry of thirty days from the date on which authenticated copies thereof are sent under sub-section (3) of section 5, or where an appeal as Bl (CU IDOL SELF LEARNING MATERIAL (SLM)aforesaid is preferred, on the expiry of seven days from the date on which copies of the order ofthe appellate authority are sent under sub-section (2) of section 6. 8. Register of stam Act shall be filed by the Certifying Officer in a register in the prescribed form maintai ig orders -A copy ofall standing orders as finally certified under this cd for the purpose, and the Certifying Officer shall furnish a copy thereof to any person applying therefor on payment of the prescribed fee 9. Posting of standing orders.-The text of the standing orders as finally certified under this Act shall be prominently posted by the employer in English and in the language understood by the majority of his workmen on special boards to be maintained for the purpose at or near the entrance through which the majority of the workmen enter the industrial establishment and in all departments thereof where the workmen are employed. 10, Duration and modification of standing orders.-(1) Standing orders finally certified under this Act shall not, except on agreement between the employer and the workmen [or a trade union or other representative body of the workmen] be liable to modification until the expiry of six months from the date on which the standing orders or the last modifications thereof ame into operation. [ 2) Subject to the provisions of sub-section (1), an employer or workman Jfor a trade union or other representative body of the workmen][may apply to the Certifying Officer to have the standing orders modified, and such application shall be accompanied by five copies of | [* * *J[the modifications proposed to be made, and where such modifications are proposed to be made by agreement between the employer and the workmen J[or a trade union or other representative body of the workmen|[, a certified copy of that agreement shall be filed along with the application.] (3) The foregoing provisions of this Act shall apply in respect of an application under sub- section (1) as they apply to the certification of the first standing orders, [(4) Nothing contained in sub-section (2) shall apply to an industrial establishment in respect of which the appropriate Government is the Government of the State of Gujarat or the Government of the State of Maharashtra.] [10-A. Payment of subsistence allowance (1) Where any workman is suspended by the employer pending investigation or inquiry into complaints or charges of misconduct against hhim, the employer shall pay to such workman subsistence allowance- (a) At the tate of fifty per cent. Of the wages which the workman was entitled to immediately prec suspension; and g the date of such suspension, for the first ninety days of (b) At the rate of seventy-five per cent. Of such wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings against such ‘workman is not directly attributable to the conduct of such workman, 232 (CU IDOL SELF LEARNING MATERIAL (SLM)(2) Ifany dispute arises regarding the subsistence allowance payable to a workman under sub-section (1), the workman or the employer concerned may refer the dispute to the Labour Court, constituted under the Industrial Disputes Act, 1947 (14 of 1947), within the local limits of whose jurisdiction the industrial establishment wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall, after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and binding on the parties (3) Notwithstanding anything contained in the foregoing provisions of this section, where provisions relating to payment of subsistence allowance under any other law for the time being in force in any State are more beneficial than the provisions of this section, the provisions of such other law shall be applicable to the payment of subsistence allowance in that State. ] 11, Certifying Officers and appellate authorities to have powers of Civil Court. - [()] Every Certifying Officer and appellate authority shall have all the powers of a Civil Court for the purposes of receiving evidence, administering oaths, enforcing the attendance of witnesses, and compelling the discovery and production of documents, and shall be deemed to be a Civil Court within the meaning of [sections 345 and 346 of the Code of Criminal Procedure, 1973 (2.0f 1974)} [(2) Clerical or arithmetical mistakes in any order passed by a Certifying Officer or appellate authority, or errors arising therein from any accidental slip or omission may, at any time, be corrected by that Officer or authority or the suecessor in office of such Officer or authority, as the case may be. ] 12, Oral evidence in contradiction of standing orders not admissible -No oral evidence having the effect of adding to or otherwise varying or contradicting standing orders as finally certified under this Act shall be admitted in any Court, [12-A. Temporary application of model standing orders .-(1) Notwithstanding anything contained in sections 3 to 12, for the period commencing on the date on which this Act becomes applicable to an industrial establishment and ending with the date on which the standing orders as finally certified under this Act come into operation under section 7 in that establishment, the preseribed model standing orders shall be deemed to be adopted in that establishment, and the provisions of section 9, sub-section (2) of section 13 and section 13-A shall apply to such model standing orders as they apply to the standing orders so certified. (2) nothing contained in sub-section (1) shall apply to an industrial establishment in respect of which the appropriate Government is the Government of the State of Gujarat or the Government of the State of Maharashtra.] 13, Penalties and procedure.-(1) An employer who fails to submit draft standing orders as required by section 3, or who modifies his standing orders otherwise than in accordance with section 10, shall be punishable with fine which may extend to five thousand rupees, and in 233 (CU IDOL SELF LEARNING MATERIAL (SLM)the case of a continuing offence with a further fine which may extend to two hundred rupees for every day after the first during which the offence continues. (2) An employer who does any act in contravention of the standing orders finally certified under this Act or his industrial establishment shall be punishable with fine which may extend to one hundred rupees, and in the case of a continuing offence with a further fine which may extend to twenty-five rupees for every day after the first during which the offence continues. (3) No prosecution for an offence punishable under this section shall be instituted except with the previous sanction of the appropriate Government. (4) No Court inferior to that of [a Metropolitan Magistrate or Judicial Magistrate of the second class] shall try any offence under this section, [13-A. Interpretation, etc., of standing orders.-Ifany question arises as to the application or interpretation ofa standing order certified under this Act, any employer or workman ][Or a trade union or other representative body of the workmen][may refer the question to any one of the Labour Courts constituted under the Industrial Disputes Act, 1947 (14 of 1947), and specified for the disposal of such proceeding by the appropriate Government by notification in the Official Gazette, and the Labour Court to which the question is so referred shall, after aiving the parties an opportunity of being heard, decide the question and such decision shall be final and binding on the parties. 13-B. Act not (o apply to certain industrial establishments -Nothing in this Act shall apply to an industrial establishment in so far as the workmen employed therein are persons to whom the Fundamental and Supplementary Rules, Civil Services (Classification, Control and. Appeal) Rules, Civil Services (Temporary Services) Rules, Revised Leave Rules, Civil Service Regulations, Civilians in Defence Service (Classification, Control and Appeal) Rules orthe Indian Railway Establishment Code or any other rules or regulations that may be notified in this behalf by the appropriate Government in the Official Gazette, apply. } 14, Power to exempt.-The appropriate Government may by notification in the Official Gazette, exempt conditionally or unconditionally, any industrial establishment or class of industrial establishments from all or any of the provisions of this Act. [14-A. Delegation of powers ~The appropriate Government may, by notification in the Official Gazette, direct that any power exercisable by it under this Act or any rules made thereunder shall, in relation to such matters and subject to such conditions, ifany, as may be specified in the direction, be exercisable also- (a) where the appropriate Government is the Central Government, by such officer or authority subordinate to the Central Government or by the State Government or by such officer or authority subordinate to the State Government, as may be specified in the notification; (b) Where the appropriate Government is a State Government, by such officer or authority subordinate to the State Government, as may be specified in the notification.) 234 (CU IDOL SELF LEARNING MATERIAL (SLM)15, Power to make rules -(1) The appropriate Government may, after previous publication, by notification in the Official Gazette, make [rules] to carry out the purposes of this Act. (2) In particular and without prejudice to the generality of the foregoing power, such rules may- (a) Prescribe additional matters to be inchided in the Schedule, and the procedure to be followed in modifying standing orders certified under this Act in accordance with any such addition; (b) Set out model standing orders for the purposes of this Act; (0) Prescribe the procedure of Certifying Officers and appellate authorities; (d) Prescribe the fee which may be charged for copies of standing orders entered in the register of standing orders; (©) Provide for any other matter which is to be or may be prescribed: Provided that before any rules are made under clause (a) representatives of both employers and workmen shall be consulted by the appropriate Government, [(3) Every rule made by the Central Government under this section shall be laid as soon as may be after it is made, before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or J[in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid |[both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule, ] THE SCHEDULE [See sections 2(g) and 3(2)] Matters to be provided in Standing Orders under this Aet 1. Classification of workmen, e.g., whether permanent, temporary, apprentices, probationers, (badlis] [fixed term employment workmen in apparel manufacturing sector] 2. Manner of intimating to workmen periods and hours of work, holidays, pay-days and wage rates. 3. Shift working, 4, Attendance and late coming. 5. Conditions of procedure in applying for, and the authority which may grant, leave and holidays. 6, Requirement to enter premises by certain gates, and liability to search, 235 (CU IDOL SELF LEARNING MATERIAL (SLM)7. Closing and re-opening of sections of the industrial establishment, and temporary stoppages of work and the rights and liabilities of the employer and workmen arising therefrom, 8. Termination of employment, and the notice thereof to be given by employer and workmen. 9. Suspension or dismissal for misconduct, and acts or omissions whieh constitute misconduct. 10, Means of redress for workmen against unfair treatment or wrongful exactions by the employer or his agents or servants. 1, Any other matter which may be prescribed.Act to require employers in industrial establishments formally to define conditions of employment under them. WHEREAS it is expedient to require employers in industrial establishments to define with sufficient precision the conditions of employment under them and to make the said conditions known to workmen employed by them, This Act is to require employers in industrial establishments to formally define conditions of employment under them and submit draft standing orders to certifying Authority for its Centification. It applies to every industrial establishment wherein 100 (reduced to 50 by the Central Government in respect of the establishments for which it is the Appropriate Government) or more workmen ate employed. And the Central Government is the appropriate Government in respect of establishments under the control of Central Government or a Railway Administration or in a major port, mine or oil field. Under the Industrial Employment (Standing Orders) Act, 1946, all RLCs(C) have been declared Contifying Officers to certify the standing orders in respect of the establishments falling in the Central Sphere, CLC(C) and all Dy.CLCs(C) have been declared Appellate Authorities under the Act. The concept of ‘Standing Orders” is one of the recent growth in relation to Indian labour- management. Prior to 1946, there existed chaotic conditions of employment, wherein the workmen were engaged on an individual basis with uncertain and vague terms of employment. The Act was enacted as a simple measure to remedy this situation ~ by bringing about uniformity in the terms of employment in industrial establishments so as to minimize industrial conflicts, The Preamble of the Act imposes a compulsion upon the employers, “to define with suflicient precision the conditions of employment” and make the same known to the workmen, Appli jon of the Act Section 1 of the Act provides that the Act shall apply to the industrial establishments (within India) with an engagement of more than a hundred workmen at present or as noted on any 236 (CU IDOL SELF LEARNING MATERIAL (SLM)day in the preceding year unless provided by the appropriate Government for application to any such industrial establishment — with less than a hundred employees. Exclusion of certain industrial establishments, Certain industrial establishments have been exeluded from its application via various statutory provisions enlisted in this Act: + Section 1(4) excludes those establishments to which Chapter VII of the BIRA or MPIESOA applies unless controlled by the Central Government, + Section 13-B excludes those establishments whose workmen are subject to the Fundamental & Supplementary Rules; various Civil Services Rules; or any other rules provided by the ‘appropriate Government. ‘+The provisions of Sections 10 and 12-A (1) do not apply to the establishments under the control of the States of Gujarat/Maharashta, Power to exempt: Seetion 14 Section 14 empowers the appropriate Government to exempt any industrial establishment from being subject to all or any of the provisions of this Act, either conditionally‘unconditionally. Special features of the Act ‘The Act envisages three important features, they are: + Concept of Standing Orders; + Adjudicatory powers of the Certifying Officer, and ‘+ CSOs (short for ~ Certified Standing Orders) to have the force of law. Whether a contract can override in the certified Standing Orders? CSOs cannot be deemed as a statutory concept, but can also not be confined to the individualistic notions of a contract, as they transcend its limits. Hence, standing orders effectuated in compliance with the statutory provisions may be considered as a special kind of contact or a ‘statutory contract’, Herein, to answer the question of whether a contract can override in the CSO, it can be concurred from the Westem India case, that “the employer & workmen cannot enter into a contract overriding the statutory contract as embodied in the CSO, except when such a 237 (CU IDOL SELF LEARNING MATERIAL (SLM)contract is entered into in compliance with Section 10(1), so as to modify such CSO, but not otherwise.” Centification of standing orders — (1) On receipt of the draft under section 3, the Certifying Officer shall forward a copy thereof to the trade union, if any, of the workmen, or where there is no such trade union, to the workmen in such manner as may be prescribed, together with a notice in the prescribed form requiring objections, if any, which the workmen may desire to make to the draft standing orders to be submitted to him within fifteen days from the receipt of the notice (2) After giving the employer and the trade union or such other representatives. of the workmen as may be prescribed, an opportunity of being heard, the Certifying Officer shall decide whether or not any modification of or addition to the draft submitted by the employer le under this Act, and shall make an is necessary to render the draft standing orders cert ofder in writing accordingly. (3) The Certifying Officer shall thereupon certify the draft standing orders, after making any modifications therein which his order under sub-section (2) may require, and shall within seven days thereafler send copies of the certified standing orders authenticated in the prescribed manner and of his order under sub-section (2) to the employer and to the trade union or other prescribed representatives of the workmen, State amendment Maharashtra: Gujarat, Standing orders Section 2(g) of the Act states that “Standing orders” are the rules relating to matters set out in the Schedule, i. with reference to: + The classification of workmen; ‘+ Manner of intimation to workers about work and wage-related details; ‘+ Attendance, and conditions of granting leaves, ete.; «+ Rights & liabilities of the employer! workmen in certain circumstances; + Conditions of ‘termination of ‘suspension from’ employment; and ‘+ Means of redressal for workmen, or any other matter. + Submission of draft standing orders, (1) Within six months from the date on which this Act becomes applicable to an industrial establishment, the employer shall submit to the Certifying Officer five copies of the draft standing orders proposed by him for adoption in his industrial establishment 238 (CU IDOL SELF LEARNING MATERIAL (SLM)(2) Provision shall be made in such draft for every matter set out in the Schedule which may be applicable to the industrial establishment, and where model standing orders have been prescribed, shall be, so far as is practicable, in conformity with such model (3) The draft standing orders submitted under this section shall be accompanied by a statement giving prescribed particulars of the workmen employed in the industrial establishment including the name of the trade union, if any, to which they belong. (4) Subject to such conditions as may be prescribed, a group of employers in similar industrial establishments may submit a joint draft of standing orders under this section. state amendment Maharashtra: Gujarat—(i) In section 3, for sub-section (1), substitute the following sub-section, namely:— “(1) Within six months from the date on which the model standing orders apply to any industrial establishment under section 2A, the employer or any workman employed therein may submit to the Certifying Officer five copies of the draft amendments for adoption in such industrial establishment: Provided that no amendment which provides for the deletion or omission of any rule in the model standing orders relating to any matter set out in the ‘Schedule shall be submitted under this section;” Submission of Draft Standing Orders: Section 3 A statutory obligation is imposed by the Act upon the employer(s) to submit, individually/ Jointly, five copies of a ‘Draft Standing Order’ within six months of its applicability to the industrial establishment, which should be inclusive of the matters enlisted in the Schedule and of the MSOs (short for ~ Model Standing Orders), if'any, and to which shall be annexed such documents containing particulars of the workmen employed. S.K. Sheshadri v H.A.L and others, (1983) In this case, the Hon’ble Karnataka High Court held that, as long as the Standing Orders fall within the Schedule to the Act, irrespective of the fact that they contain additional provisions which are not accounted for in the MSOs, the Standing Orders would not be deemed to be invalid or ultra vires of the Act, The MSOs only serve as @ model for framing the Standing Orders. Hindustan Lever v Workmen, (1974) In the present case, the issue relating to the ‘transfer of workmen’ was highlighted by concurring that, the Manager is vested with the discretion of transfer of workmen amongst different departments of the same company, so far as the terms of the contract of employment are not affected. Further, if the transfer is found to be valid, the onus of proving it to be invalid lies on the workmen in dispute 239 (CU IDOL SELF LEARNING MATERIAL (SLM)Management of Continental Construction Ltd. vy Workmen of Continental Construction, (2003) In the instant case, the employer's right to terminate the service of a probationer was recognised by declaring that, ifa person is an employee on probation, itis an inherent power ofthe employer to terminate during! at the end of the probationary period, provided, that even while acting in accordance with the CSO, the employer's action be fair and consistent with the principles of natural justice, Conditions for Certification of Standing Orders: Section 4 Section 4 of the Act declares the conditions upon the fulfilment of which, a standing order can be certified. It thereby requires a standing order to provide for all the matters set out in the Schedule of the Act and be in conformity with the provisions of this Act. Deviation from Model Standing Orders Section 4(b) when read with Section 32) of the Act, requires the draft standing order to, as far as practicable, be in conformity with the MSO, hence, in cases where it cannot be so claimed, the appropriate authority may permit deviation from the MSO, and negate the addition of such impracticable provision in the Standing Order. Reasonableness of Standing Order The proviso to Section 4 of the Act, as amended by Act 56 of 1956, necessitates the Certifying Officer or appellate authority to adjudicate upon the fairness or reasonableness of the contents of such Draft Standing Order in order to proceed with its certification, Matters not covered by the Schedule ‘The Act contemplates by itself that the Standing Orders must cover matters included in the Schedule initially, and those which may be added to the Schedule by the appropriate Government in exercise of the authority conferred on it under Section 15. Any other provisions of such kind may be made if so certified by the Certifying Officer to be fair and reasonable under Section 4 of the Act. Different set of Standing Orders “Once the standing orders are certified, they constitute the conditions of the service binding upon the management and the employees serving already and in employment or who may be employed after certification.” This implies that different set of standing orders eannot exist in respect of distinet sections of workmen or the employer(s), for that would frustrate the intent 240 (CU IDOL SELF LEARNING MATERIAL (SLM)of the legislature by rendering the conditions of employment as indefinite & diversified, just as existed prior to the enactment of the said Act Certification Process: Section S ‘The procedure for certification of Standing Order, as prescribed under Section 5 of the Act, is threefold: + The Certifying Officer to send a copy of the Draft Standing Order to the workmen or trade union, along with a notice ealling for objections, that shall be submitted to him within 15 days of receiving such notice. + Upon receipt of such objections, the employer and workmen to be given an opportunity of being heard, after which the Certifying Officer shall decide and pass an onder for modification of the Standing Order. + Finally, the Certifying Officer shall certify such Standing Order, and thereby, within seven days, send a copy of it annexed with his order for modification passed under Section 5(2). Appeals: Section 6 Any related party aggrieved by the order of the Certifying Officer may appeal to the “appellate authority’ within 30 days, provided that its decision, of confirming such Standing Order o amending it, shall be final. The appellate authority shall thereafter send copies of the Standing Order, ifamended, to the related parties within seven days, Modification of Standing Order: Section 10 A.CSO cannot be modified, except on agreement between the related parties, until six months, from the last modification or operation of such standing order under Section 7. Further, subject to Section 10(1) and other provisions of this Act, the parties may apply to the Centfying Officer for modifications in the standing order by annexing five copies of the proposal or a certified copy of the agreement for modifications, Payment of Subsistence Allowance: Section 10-4, Section 10-A of the Act stipulates for the payment of subsistence allowance by the employer to a workman who is suspended, pending the investigation’ inquiry of his misconduct, at the rate of 50% for the first 90 days, and 75% for the remaining period if the delay is not attributable to the workman. The Act also allows an appeal to the Labour Court constituted under IDA-1947 in case of a dispute relating to such subsistence allowance, whose decision shall be final, Moreover, it deckares that the provisions applicable to a particular State, if more beneficial, shall prevail over this Section. 241 (CU IDOL SELF LEARNING MATERIAL (SLM)‘Temporary Application of Model Standing Orders: Section 12-A. Section 12-A provides that in spite of the provisions under Section 3 ~ 12, in the period between the applicability of this Act and operation of the CSO, MSOs to be adopted, with Sections 9, 13(2), and 13-A applying in the same way as would apply to a CSO. It also declares that if there exist two categories of workmen, and the daily rated have a CSO in existence for them, then the MSO be adopted for the monthly rated workmen, Penalties and procedure: Section 13, The Act makes it a penal offence in case of a violation of Section 3 or 10 of the Act by the employer, by imposing a fine of Rs. $000 and an additional Rs. 200 per day for a continuing offence. Further, in ease ofan infringement of the CSO, a fine of Rs. 100 and an additional of Rs, 25 per day for a continuing offence. The Section declares that no prosecution shall be instituted under it except on prior approval by the appropriate Government, and whence instituted, be tried only by such Courts not inferior to the Metropolitan/Judicial Magistrate of Second Class. Interpretation of Standing Orders: Section 13-A, Any question relating to the application/interpretation of this Act may be referred to the Labour Courts constituted for this purpose, whose decision shall be final and binding on all parties Delegation of Powers: Section 14-4 The appropriate Government may delegate its powers under the Act to an Officer/Subordinate Authority to the Central or the State Govemment, as the case may be, and subject to such directions as may be provided under the notification. Power to make rules: Section 15 The Act empowers the appropriate Government to make rules for the purpose of this Act, in consultation with representatives of related parties, relating to: + Additional matters to be included in the Schedule & the procedure for modification; + Set out MSOs; + Procedure to be followed by Certifying Officers & appellate authorities; +The fee to be charged for the copies of registered standing orders, and any other matter so prescribed. 242 (CU IDOL SELF LEARNING MATERIAL (SLM)Provided that the rules made by the Central Government be passed/annulled through each House of Parliament without prejudice to the validity of anything done under it Conclusion The Act is a regulatory regime to formally define the employment relations between the workmen/trade union and the employer. A very prominent initiative of this Act is the concept of ‘standing orders’ which is amorphous in nature being a contract promulgated statutorily, that represent the will of the parties so regulated, Finally, it may be stated that, though it lays an exemplary notion, it requires thorough reforms in respect of the present scenario of employment practised by the principal employer so as to fulfil the Constitutional objective of ice substantially securing socio-economic jus 9.3 SUMMARY * The Act is a regulatory regime to formally define the employment relations between the workmen/trade union and the employer. * A very prominent initiative of this Act is the concept of ‘standing orders’ which is amorphous in nature being a contract promulgated statutorily, that represent the will of the parties so regulated. Finally, it may be stated that, though it lays an exemplary notion, it requires thorough reforms in respect of the present scenario of employment practised by the principal employer so as to fulfill the Constitutional objective of securing socio-economic justice substantially 9.4 KEY WORDS + Standing order act- rules of conduct for workmen employed in industrial establishments, + Regulatory regime- A system of regulations and the means to enforce them, usually established by a government to regulate a specific activity + Delegation of Powers- the transfer of @ specific authority by one of the three branches of goverment * MSO- Management Services Organization -is a legal entity created to provide ‘management and administrative services to other organizations, * CSO- chief security officer (CSO) is a company executive responsible for the security of personnel, physical assets, and information in both physical and digital form. 9.5 LEARNING ACITIVITY 243. (CU IDOL SELF LEARNING MATERIAL (SLM)1. Understand Industrial employment Standing order act 1946, concept and the existence for the same. 2. Code of disciple 9.6 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1 2, 3 4. 5s. Define Code of Disciple Importance of Code of discipline in industrial sector What are the matters provided in standing order? What are the conditions for certification for standing order? What is Basie Objectives of the Code of Discipline Long Questions 1 2, 4 5. What is the objective of industrial standing order 1946? ‘What are the contents of model standing order? What is the Actions having Mutual Agreement of Management &Actions Agreed to by the Management Actions Agreed to by the Union What is the Matters to be provided in Standing Orders under this Act> B. Multiple choice Question 1. The code of discipline was evolved at the Indian Labour Conference in a. 1958 b. 1927 ©. 1936 d. 2008, 2. Industrial employment standing orders act is applicable in every industrial establishment 244 (CU IDOL SELF LEARNING MATERIAL (SLM)‘where _ workmen are employed. a 100 b. 50 . 600 3. An authority who is appointed by the appropriate government by notification in the official gazette to exercise in such area as may be specified a. Appellate authority b. Certifying officer ©. Acting officer . None of these 4. Which of the following is an additional matter to be provided as per the act relating to all industrial establishments in coal mines? a. Transfers b. Service certificate c. Exhibition and supply of standing order 4. Allofthese 5. In which language is the text of the standing orders posted on the notice board? a. English or that is understood by majority of the workman, b. Only English c. Language as understood by the workman 4. Allofthese Answers 1 -a, 2-a,3-a,4-d,S-a 9.7 REFERENCES Text Books ~ 245 (CU IDOL SELF LEARNING MATERIAL (SLM)+ Employee complaint handling ~ Charles Boyd * The Employers guide to Grievance and Disciple procedure ~ Mike Parkin '* Workplace investigation ~ Lisa JD Reference Books ~ + Walton RE. and Mckersie R.B., A Behavioural theory of Labour Negotiations (1963), MoGraw Hill, New York, pp.1-7. 2. A.M. Sarma, Industrial Relations, Himalaya Publishing House, 194-202. 3, Mamoria, Mamoria, Gankar, “Dynamics of Industrial Relations”, Himalaya Publishing House, 2010, p.257 Website * hitps://indiankanoon.org/doe/1376794/ © hitps://legislative.gov. insites/default/files/A1946-20. pdf # https://www.indiacode.nic.in/bitstream/123456789/2257/1/AAA1946Em_20.pdf 246 (CU IDOL SELF LEARNING MATERIAL (SLM)UNIT - 10: EMPLOYMENT ACTS- THE EMPLOYEES PROVIDENT FUND & MISCELLANEOUS, PROVISIONS ACT, 1952 STRUCTURE 10.0 Learning Objectives 10.1 Introduction 10.2 Definitions; Schemes under the act 10.3 Employees State Insurance Act, 1948 10.4 Objectives and applicability of the scheme; Definitions, 10.5 Summary 10.6 Keywords 10.7 Learning Activity 10.8 Unit End Questions 10.9 References 10.0 LEARNING OBJECTIVES ter studying this unit, you will be able to: * Understand the importance of ESIC & other employment acts in India. © Benefits of Health care 10.1 INTRODUCTION employment scheme means the Guarantor’s program under its Regional Development Fund, established and operating pursuant to Joint Decree No. 4 of 1986 (XIL30.) of the President of the National Planning Office, the Minister of Finance and the Minister of Construction and Urban Development of the Guarantor, and Employment Fund, established and operating pursuant to Decree No. 52 of 1987 (X.15.) of the Couneil of Ministers of the Guarantor, for the development of new employment opportunities in areas experiencing adverse employment impact as a result of measures undertaken to restructure the economy, Social Security laws related to employment ‘The principal social security laws enacted in India are the following: 247 (CU IDOL SELF LEARNING MATERIAL (SLM)+ 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. ‘+ 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. AS per the Employees’ Provident Funds (Amendment) Scheme 2014 the wage ceiling for coverage under the scheme has been increased from Rs 6500 to Rs 15000 per month. + The Employees! 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. + The Matemity Benefit Act, 1961 (MLB. Act), which provides for 12 weeks wages uring matemity as well as paid leave in certain other related contingencies. ‘+ 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 find legislation exists for workers employed in Coal Mines and ‘Tea Plantations in the State of Assam and for seamen. ‘+ Employees’ Pension Scheme 1995 came into force on 16 November, 1995 and applies to the employees of all factories and other establishments to which the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 applies. The Scheme was amended in 2014 to increase the wage ceiling for coverage under the scheme from Rs {6500 to Rs 15000 per month. Under the scheme, a guaranteed minimum pension of Rs 1000 per month was launched in September 2014, 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:- ‘+ Employees? Provident Fund and Miscellaneous Provisions Act, 1952 ‘+ Employees’ State Insurance Act, 1948 + Payment of Gratuity Act, 1972. ‘+ Maternity Benefit Act, 1961 + Employee’s Compensation Act, 1923 Employment Generation in India 248 (CU IDOL SELF LEARNING MATERIAL (SLM)Anti-poverty strategy comprises of a wide range of poverty alleviation and employment generation programmes, many of which have been in operation for several years and have been strengthened to generate more employment, create productive assets, impart technical and entrepreneurial skills and raise the income level of the poor. Under these schemes, both wage employment and self-employment are provided to the people below the poverty line From 1998-99, various poverty alleviation and employment generation programmes are grouped under two broad categories of + SelfEmployment Schemes ‘+ Wage Employment Schemes. ‘Unorganized Sector Workers in India “Unorganized Sector Worker” means a person who works for wages or income; directly or through any ageney or contractor; or who works on his own or her own account or is self employed; in any place of work including his or her home, field or any public place; and who is not availing of benefits under the ESIC Act and the P.F Act, individual insurance and pension schemes of LIC, private insurance companies, or other benefits as decided by the Authority fiom time to time. Employment Generation — Government Initiatives + Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA). The Ministry of Rural Development, Mahatma Gandhi National Rural Employment Guarantee Act (Mahatma Gandhi NREGA) aims at enhancing livelihood seeurity of houscholds in rural areas of the country by providing at least one hundred days of guaranteed wage employment in a financial year to every household whose adult members volunteer to do unskilled manual work. The Act came into force on February 2, 2006. All ural districts are covered under Mahatma Gandhi NREGA. ‘+ Sampoorna Rojgar Yojana. The primary objective of the Scheme is to provide skilled and local employment and thereby improve skills levels in all rural and urban areas, The scheme is open to all rural and urban unemployed educated youth who are in need of employment and desire to do manual and skilled work in and around his locality/village/habitat. Beneficiary gets fixed based payment of wages and incentives based on performance: ‘+ Aajeevika - National Rural Livelihoods Programme. Aajecvika was launched by the Ministry of Rural Development (MoRD), Government of India in June 2011 NRLM has set out with an agenda to cover 7 Crore rural poor households, across 600 districts, 6000 blocks, 2.5 lakh Gram Panchayats and 6 lakh villages in the country through self-managed Self Help Groups (SHGs) and federated institutions and support them for livelihoods collectives in a period of 8-10 years. In addition, the poor would 249 (CU IDOL SELF LEARNING MATERIAL (SLM)