Module - II

Dr. Bidya Dash

Contents
Industrial Relations:
 Concept

 Scope

 Approaches to Industrial Relations – Unitary, Pluralistic, Radical

Approach
 Industrial Relations systems

Trade Unionism: Concept, Structure, and function

Industrial Dispute:
 code of discipline and grievances management,

 dispute resolution and industrial harmony,

 Collective bargaining
Questions to be addressed?

 What were the issues of strike?

 What is the demand of Subbu and his team?

 If You were in place of Sudarshan, what action you would have

taken to avoid strike so as to save M.Feeds.

Industrial Relation – As a Concept

 It is a most complex problem in Morden industrial society.

 It is an art of living together for the purposes like:

1. production,

2. productive efficiency,

3. human well-being

4. industrial progress.

IR is concerned with the relationship between management and workers

and the role of regulatory mechanism(trade unionism, collective
bargaining, law) in resolving any industrial dispute.
Industrial Relation – As a Concept

 Industrial relations is a social concept because it deals with social

relationships in different walks of life.

 It is also a relative concept because it grows and flourishes or

stagnates and decays in accordance with the economic, social and

political conditions prevailing in a society.
 Defining IR by Dale Yoder

 “whole field of relationship that exists because of the necessary

collaboration of men and women in the employment process of an

industry.”
 The four main parties who are actively associated with any

industrial relations system are the workers, the managements, the

organisations of workers and managements, and the State.
 Here the term collective interest has lot of importance.
 Importance of IR
 IR is key for increased productivity in Industrial establishment.

 In Eicher (Alwar Plant) – Tractor Productivity went up from 32%

between 1994-1996 to 38% 1997.

 The Brutal Side of IR ( Militancy of workers)

 Case 1 – Roy George – VP, Pricol killed by worker.

 Case 2 – Lalit Kumar Chaudhury , Graziano Danmission, Italian

Company killed by worker in factory premises

 Case 3 – Union leader and executives were killed in group clashes in

ceramic factory, puducherry, 2012

 Case 4 – Avinash Kumar Dev- GM- HR, Manesar Palnt Maruti, 2012

killed by workers by broking his limbs, and burnt him.

So, here IR has moral in 2 dimensions
 1. To protects the workers interest

 2. To protect right’s of managers

To Protects the workers interest:

 It is unethical on the part of a management to take advantage of the

helplessness of workers and exploit them.

 Unemployment compels worker to accept jobs, inhuman working

conditions and low wages.

 So the objective of IR here is to protect the workers’ interest and to

improve their economic condition.

To protect right’s of managers

 Managers expect workers to observe code of discipline, not to do

illegal strikes, not to indulge in damage to company’s property,

not to assault supervisors, peers, not to come inebriated to the
workplace.
 Any deviation in worker's behaviour, it is the prerogative to take

action.
Conclusion on two dimension aspects of IR

 It is the people who create problem everywhere, it is only they who

can find solutions too. Viewing every problem seriously and

restoring to manipulative style of IR will not help full to the
manager or management. The new age of IR should be free from
suspicion , prejudice and ill-will towards workers.
Scope of IR
 It is not confined to only common labour-management relations or

employer-employee relations.
 It exists at various levels of the organisational structure.

 relations among workers themselves within the class of employees,

relations among the managements within the managerial class, and

relations between the two distinct classes of workers and
management.
Scope of IR
 It denotes all types of inter-group and intra-group relations within
industry.
 The network of relations is arise out of functional interdependence

between workers and managements and between industrial

organisations and society.
Approaches to Industrial Relations

Unitary approach

Pluralistic approach

 Radical Approach
Unitary approach
 Under unitary approach, IR is grounded in mutual co-operation,

individual treatment, team work and shared goals.

 Work place conflict is seen as a temporary aberration.

 It result into poor management from employees who do not mix

well with the organisation’s culture .

 Union co-operate with the management and the management’s right

to manage accepted .
 It is because there is no “ we-they” feeling.

 The focus of unitary approach is every one benefits. (i.e. common

interest and promotion of harmony)

Case – Goodbye to strikes and lockouts
Pluralistic Approach
 The perceptions under this approach are:

 1. organisations as coalitions of competing interests, where the

management’s role is to mediate amongst the different interests
 2. trade union as legitimate representative of employee interests.

 3. Stability of IR as the product of concessions and compromises between

management and unions.

 In pluralistic approach, a strong union is not only desirable but necessary.

 Here there is more than one source of power in the relationship between

workers and management.

 Unions are central components to the balance of power between

management and workers.

Marxist Approach
 This approach is named after Karl Marx.

 According to Marx, the adversarial relations in the workplace are simply

one aspect of class conflict.

 Thus it focuses on the type of society in which an organisation functions.

 Here the conflict arises not due to competing interests within the

organisation.
 Because there is a division within society.

 Means the group who own the production and another group those who

have only offer their labour.

 Here trade union acts from both the side.

 In Marxist approach there is a clashes of interest between capital and labour.

Dunlop’s IRS
DUNLOP’S SYSTEM THEORY (1958) (INDUSTRIAL
RELATION SYSTEM)
 “The actors, in given contexts, establish rules for the
workplace and the work community, including those
governing the contacts among the actors in an
industrial relations system. This network or web of
rules consists of procedures for establishing rules, the
substantive rules and the procedures for deciding
their application to particular situations. The
establishment of these procedures and rule – the
procedures are themselves rules-is the centre of
attention in an industrial relations system. If further
element is required to complete the analytical system:
an ideology or a set of ideas and beliefs, commonly
held by the actors, that helps to bind or to integrate
the system together as an entity” Dunlop (1958).
Industrial Relations systems
 A sound IRS is one in which relationships between management and

employees(union) in one hand and in other hand relationship between

management and state.
 The industrial relations system in India has been under pressure for

decades. The main architecture of the system was established prior to

independence and remains mostly unchanged.
 IRS is highly centralised. The state is the main mediator between

capital and labour.

 Fundamental challenges of IRS is size of informal or unorganised

workforce.
Statistics
 India’s estimated 450 million informal workers comprise 90% of its total

workforce, with 5-10 million workers added annually.

 According to Oxfam’s latest global report, out of the total 122 million

who lost their jobs in 2020, 75% were lost in the informal sector.
 The Covid-19 pandemic experience tells us that there is also a need to

provide social protection, as the vulnerabilities of the informal sector

became even more prominent as the entire country went into a state of
suspension due to the lockdown.
 financial year 2020-21, the economy is expected to contract by 7.7%. So,

there is an urgent need to revive the economy by generating employment.

Labour Related Challenges
 The large number is employed in the rural sector, the bigger

challenge is in the urban workforce in the informal sector.

 Long working hours, low pay & difficult working conditions.

 Low job security, high turnover and low job satisfaction.

 Inadequate social security regulation.

 Difficulty in exercising rights.

 Child and forced labour and discrimination on basis of various

factors.
 Vulnerable, low-paid and undervalued jobs.
Labour Related Challenges

 Productivity: informal sector basically comprises MSMEs and household

businesses which are not as big as firms like Reliance. They are unable to take
advantage of economies of scale.
 Inability to Raise Tax Revenue: As the businesses of the informal economy are

not directly regulated, they usually avoid one or more taxes by hiding incomes
and expenses from the regulatory framework. This poses a challenge for the
government as a major chunk of the economy remains out of the tax net.
 Lack of Control and Surveillance: The informal sector remains unmonitored

by the government.
 Difficult for the government to make policies regarding the informal sector in

particular and the whole economy in general.

Recent Initiatives Taken by Government
to strengthen IRS
Labour Codes:

The new labor codes that have been passed by parliament to take

care of the informal urban segment of the informal economy

 i.e. the gig economy workers now are the worst affected in a

pandemic like situation.

E-Shram Portal

The Ministry of Labour & Employment has

developed eSHRAM portal for creating a National Database of
Unorganized Workers (NDUW) for optimum realization of their
employability and extend the benefits of the social security
schemes to them.

It is the first-ever national database of unorganised workers

including migrant workers, construction workers, gig and
platform workers, etc.
Labour Reform:

The Parliament passed four labour code on industrial

relations; occupational safety, health and working
conditions; and social security — proposing to simplify the
country’s archaic labour laws and give impetus to economic
activity without compromising with the workers’ benefits.
Dimensions of IRS
 IR may exist between:

 employees to employees

 employees to employers

 Employers to employers

 The above all dimension is depends on one question that is

under what conditions it operates.

Significance of IRS

 Important benefit of IRS is that this ensures continuity of

production and also the resources can be fully utilized, resulting

in the maximum possible production.
 It reduce the industrial dispute, strike, lockout .

 How does this significance has affected to employee relation

concept?
 The answer is:

 Attitude of employees and management and union will likely to

be strengthened. There will be no disagreement of procedure of

doing things and easily resolve the grievances.
 There will be no inter union rivalry in case of more than one

union. The militancy nature of workers can be reduced .

IRS @ Tata Steel
 Tata Steel – pioneering worker welfare schemes.

 According to survey by Business Today, India (2016) Tata steel is

declared as the “Best place to work in the core sector”.

 5 days work week

 Tata steel is the first company who introduce first in employee

welfare measures introduced overtime.

 8-hours work day in 1912, leave with pay scheme in 1936 and

worker’s provident fund scheme in 1920.

 All these initiatives were subsequently adopted by International

Labour organisation and enacted by law in India.

Parties to IR
 Employee
 Major stakeholder in IR are employees.

 The roles of employee are to redress the bargaining advantage

on one-on one basis, i.e. Individual worker is-a-visa individual

employer by way of joint or collective actions.
 To secure better terms and conditions of employment for their

members.
 To obtain improved status for the worker in his / her work.

 To increase democratic mode of decision making at various

levels.
Role of Employers Association
 Employers associations are representative voluntary organisation

led by elected leaders and managed by professional managers with

a permanent staff-which specialise in collective bargaining.
 These organisations provide support and advice to employers and

employees to help them better understand their rights and

obligations in the workplace.
 It focuses mainly on matters relating to a wide range of

employment issues including industrial relations.

Role of Employers Association
 Chambers of commerce usually set up to defend the economic

interests of employers.
 Sectoral association like CII( mainly confined to engineering

industry).
 So the objective of Employers Association are:

 Protect interest of employers engaged in industry, trade and

commerce
 Disseminate information relating to labour policy, labour
management relations, collective bargaining.
 Liaise with union government.
 Examples of employers’ associations
 ASSOCHAM (The Associated of Chambers of Commerce and Industry of

India – represent the interest of trade and commerce)

 FICCI ( The federation of Indian chambers of commerce and industry –

business organisation)
 AIMO (All India manufacturers organisation)

 WASME ( World association for small and medium enterprises)

 FASSI ( Food Safety and standards authority of India)

 NASSCOM ( National Association of software and service companies –

trade association of Indian information technology(IT) and BPO

companies.
 FIEO ( The federation of Indian export organisations)
What role does the government in IR?
 The relationships between employees and employers are influenced by the

government through law, policies and regulations.

 The legal frame work within which industrial relations must function is

determined by the government.

 For example the amount of hours an employee is allowed to legally work per

week and employer is obligated to pay to an employee .

 It also involve in setting an industrial relations dispute in court.

 Basically, the government benefits from industrial relations in that a safe

working environment promotes employee and employer satisfaction, which in

turns helps in maintaining high employment rates that reflects well on
government to address the poverty and crime.
TRADE
UNION
 Concept

 Trade union came into being as an agent of workers and

working class.
 Over the year workers struggled hard to achieve an adequate

measure of their protection against exploitation.

 Trade union is also called labour union.

 It is an association of labourers in particular trade, industry or

company created for the purpose of securing improvement in

pay, benefits, working conditions.
Characteristics of trade union

 Trade unions are voluntary association of either employee or

employer or independent workers.

 Trade unions are generally permanent in condition.

 Basic objective is to protect the needs of workers.

Why union???
Trade union emerge due to group
psychology.
Trade union is an organising centre, it
provide the locus of for collecting the forces
for working class.
Trade union provides job security to the
employees.
 Reformist Union
 It aims to retain the present structure of capitalist society.

 They never try to destroy the existing social, economical and

political structure.
 It has two types:

 Business unionism

 Uplift unionism
Business unionism
1. Here smooth and cordial relationship exist between employee and
employers.

2. All the problems of workers solved by collective bargaining.

Employees seek to achieve economic objectives.

3. It favours voluntary arbitration and avoid strikes and lockout.

Uplift Unionism:

4. It is also called friendly or ideal unionism aim to act as an

social, intellectual and moral values of the workers.

5. It puts more emphasis on insurance benefits , health ,

education and welfare measure
Revolutionary Union
 It seek to achieve their objectives by destroying the existing

capitalist structure and replacing with socialist or communist

structure.
 They try to destroy the existing economic system by revolutionary

measure.
 Anarchist Union: such union aim at destroying the present

economic system by resorting to revolutionary measure.

 Political union: seek to redistribute the wealth by giving effective

share to the workers. The get power basically through political

actions only.
Revolutionary Union
 Predatory union: They seek their objectives without sticking to

any approach.
 Guerrilla Union: They believe in exploitation, violence and non

cooperation. They are generally non democratic. They don’t

believe in cooperation with their employees.
On the basis of membership structure
 Craft union: it covers all workers engage in a single occupation or craft

irrespective of the industries form a union.

 All craft union links together those workers who possess similar skills, craft

training, apprenticeship and specialization.

 Example : all workers of textile industries.

 Industrial union:

 Unions organised on the basis of an industry rather than craft is called industrial

union.
 All workers skill , unskilled and semi skilled working in a particular industry

regardless of the difference in crafts, skill position or gender form together an

industrial union.
 Ex- textile labour association, engineering mazdoor sabha.
On the basis of membership structure
 Staff union: it’s a combination of craft union and industrial
relation.
 Staff union is mostly formed by the workers to tertiary sectors

like health, tour and travel industry.

 General union :

 It comprises of workers from various industry and various skills.

 Workers from different industries and different occupation

formed general union.

Structure of trade union in
India
Structure of trade union in India
 The national / central federation is the apex trade union that

brings coordination in the activities of different trade union.

 Such federation takes collective action when needed.

 Ex- INTUC, AITUC, National labour organization, All India

bank employees associations, Railway association, electricity

associations.
State Branches of Central
Federations
The central federations have their State
branches. These branches are free to
manage their own affairs. However, in
actual practice these federations seek their
guidance of the central federations on
various issues.
Industrial Federations
 Workers belonging to a particular industry have certain
problems in common, which can at best be settled at the
industrial level. In order to deal with their problems
effectively, the plant level and or locality level unions have
tended to form federations at two levels: regional and
national levels.
 Examples of regional level federations are: the UP chini
Mazdoor Federation and the Bihar Sugar Workers' Federation.
 All India Coal Workers' Federation, All India Bank Employees'
Federation, National Federation of Posts and Telegraph
Employees, and All India Railway Men's Federation. Industrial
federations Trade Union Structure at their national level are
also existing in cotton textiles, sugar,, insurance, and
Recognition engineering, iron and steel, and oil-refining
industries
Region-cum-Industry Level
Industrial Unions
This type of unions cover all categories of
employees of a particular industry
(irrespective of their number of plants or
the employers) located in a particular city/
region. Examples are: Rastriya Mill Mazdoor
Sang located in Mumbai.
Functions of trade union
 Five types of functions trade union does.

 1. Basic function

 2. Economic function

 3. Welfare function

 4. Legal function

 5. Political functions
 Basic function of trade union is to build their organisation, both

numerically and financially.

 Economic function essentially implies bread and butter functions.

 Welfare function : trade union should shoulder social responsibilities.

 Legal function: trade unions closely associate themselves with the

law-making process, interpretation of laws and providing infomations

about the various for the benefit of their members.
 Political functions: Trade union kept themselves abreast of the

political events.
Further concluding the functions of trade union:
 Broadly we can say that trade union has militant functions

and fraternal functions.

 Militant Functions:

 1. to achieve higher wages and better working condition.

 2. To raise the status of workers as a part of Industry.

 3. To protect labours against victimization and injustice.

 Fraternal Functions:

 To take up welfare measures for improving the morale of workers.

 To generate self confidence among worker.

 To provide opportunity for growth and promotion.

 To protect women workers against discrimination.

Industrial Dispute - 1947

 It means may dispute of difference between employees and

employers or between employers & women, between

workmen and workmen.
 The dispute occurs for two reasons.

 1. employment issues

 2. non- employment issues

4 types of Industrial Disputes

 Interest disputes: it refers to gains the conflicts concerning the

economic or non-economic interests of the employees, like

remuneration, working condition, job security, benefits.
 Recognition dispute: The trade unions often enter into a dispute

with the management during negotiation or collective bargaining

for benefit of members.
4 types of Industrial Disputes
 Grievance: The conflicts concerning the employee’s rights and

legal issues with the management are termed as grievance

disputes.
 Unfair labour practices disputes: The disputes over the

unethical treatment of the management towards the labourer such

as discriminating them for holding membership of trade union,
restricting communication, employing new workers during
strikes .
Code of Discipline

 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.
 This code of discipline evolved at the Indian Labor Conference in
1958.
 It specifies various obligations for the management and the workers

with the objective of promoting cooperation between their

representatives.
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
 Grievances
 Grievance means any type of dissatisfaction or discontentment's

arising out of factors related to an employee's job which he thinks are

unfair.
 Grievances may occur due to a number of reasons:

 Economic: Employees may demand for individual wage adjustments.

 Work environment: It may be undesirable or unsatisfactory

conditions of work. For example, light, space, heat, or poor physical
conditions of workplace, defective tools and equipment, poor quality
of material, unfair rules, and lack of recognition.
 Grievances

 Supervision: attitudes of the supervisor towards the employee such as

perceived notions of bias, favouritism, nepotism, caste affiliations and

regional feelings.

 Organizational change: change in the organizational policies can

result in grievances. For example, the implementation of revised

company policies or new working practices.

 Employee relations: unable to adjust with their colleagues, suffer from

feelings of neglect and victimization and become an object of ridicule

and humiliation.
The effects of the Grievances
 On the production:

 a. Low quality of production

 b. Low productivity

 c. Increase in the wastage of material, spoilage/leakage of machinery

 d. Increase in the cost of production per unit

One the employees:

 a. Increase in the rate of absenteeism and turnover

 b. Reduction in the level of commitment, sincerity and punctuality

 c. Increase in the incidence of accidents

 d. Reduction in the level of employee morale.

The effects of the Grievances
 On the managers:

 a. Strained superior-subordinate relations.

 b. Increase in the degree of supervision and control.

 c. Increase in indiscipline cases

 d. Increase in unrest and thereby machinery to maintain

industrial peace
Formal Procedure to Handle Grievances
 Grievance means any type of dissatisfaction or discontentment’s arising

out of factors related to an employee’s job which he thinks are unfair.

A grievance may arise due to several factors such as:
Violation of management’s responsibility such as poor working
conditions
 Violation of company’s rules and regulations

 Violation of labor laws

 Violation of natural rules of justice such as unfair treatment in

promotion
Procedure

 Grievance procedure is a Step by step process an employee must follow

to get his or her complaint addressed satisfactorily.

 In this process, the formal (written) complaint moves from one level of

authority (of the firm and the union) to the next higher level.
 The grievance procedures differ from organization to organization.

 Open door policy

 Step-ladder policy
Open and close door policy

 Open door policy: Under this policy, the aggrieved employee is free to

meet the top executives of the organization and get his grievances redressed.
 Such a policy works well only in small organizations.

 However, in bigger organizations, top management executives are usually

busy with other concerned matters of the company.

 Moreover, it is believed that open door policy is suitable for executives;

operational employees may feel shy to go to top management.

Close door policy
 Close door policy: Under this policy, the aggrieved employee has to follow

a step by step procedure for getting his grievance redressed.

 In this procedure, whenever an employee is confronted with a grievance, he

presents his problem to his immediate supervisor.

 If the employee is not satisfied with superior’s decision, then he discusses

his grievance with the departmental head to find a solution.

 However, if the committee also fails to redress the grievance, then it may be

referred to chief executive. If the chief executive also fails to redress the

grievance, then such a grievance is referred to voluntary arbitration .

GRIEVANCE PROCEDURE IN INDIAN INDUSTRY
 Collective bargaining
 It is the formal process of negotiation between an employer and a

group of employees – with their union representative.

 It is result in a collective bargaining agreement (CBA) an legally

binding agreement that layout policies agreed by management and

labour.
 CBA often referred to as the ‘law’ at workplace.

 CBA includes provision that address compensation, scheduling,

promotions discipline and job standards.

 CBA also contains a grievance procedures.
When does collective bargaining occur?
Employees and employers engage in
collective bargaining to negotiate new
contracts and renegotiate existing contracts
that have expired.
In 2015 alone, an estimated five million men
and women are engaged in the collective
bargaining process.
Who can collectively bargain?
The National Labor Relations Act (NLRA)
grants most private sector employees the
right to organize unions and collectively
bargain.
Some members of the private sector,
including employees of very small
businesses,
agricultural workers, domestic workers,
supervisors and independent contractors, do
not have the right to engage in
collective bargaining
Collective bargaining process