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Industrial Relations and LabourLaws

Dr A Jagan Mohan Reddy

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Introduction

Industrial Relations commonly denotesemployee- employer relations

I Rs are born out of employmentrelationship in an industrial setting

Industrial Relations concerned with peoplewho are the base of the industry

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What is IR?

IR means Relationshipthat emerges out of dayto day working and

association of labourmanagement

In wider sense it alsomeans, the relation

between an employeeand an employer in thecourse of running of anindustry

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Definition of IR

WHOLE FIELD OF RELATIONSHIP THAT

EXISTS BECAUSE OF THE NECESSARY

COLLABORATION OF MEN AND WOMENIN THE EMPLOYMENT PROCES OF ANINDUSTRY

Dale Yolder[1982]

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Background of IR

People leaving forms livelihoodProgressive, sophisticated class

Govt stepping in harmonious IRsNew techniques of production

Therefore Labour employer relationsbecomes complex clear understanding rewarding experience.

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Evolution & Growth of IR

A) Pre-Independence Era

Conditions of Employment and Wageswere very poor

No laws to protect the interests ofworkers except the Employers &

Workmen (Disputes) Act, 1860 whichused to settle wage disputes.

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B)After First World War

IR concept assumed a new dimension Workers resorted to violence& employers

to lockouts Strikes, Lockouts & Disturbances.As a result Government enacted Trade

Disputes Act, 1929, to ensure the earlysettlement of Industrial Disputes.

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C)After Second World War

India faced many problems after II WorldWar, such as:

Rise in Cost of living Scarcity of Essential Commodities

High Population growth rate

Massive Unemployment Increasingly Turbulent industrial relations

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D) Post-Independence Era

Enactment ofIndustrial Disputes Act, 1947for permanently settling industrial disputes

Setting up ofIndian Labour Conference, a

Tripartite body to look into IR problems. Enactment of many labour laws to protectthe interests of industrial workers

Offered other solutions like, recognition ofunions, grievance procedure for workers,workers participation schemes etc.

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How IR picked up

Institutionally, industrial relations was founded by JohnR. Commons when he created the first academic

industrial relations program at the University ofWisconsin in 1920.

Early financial support for the field came from John D.

Rockefeller, Jr. who supported progressive labor-management relations in the aftermath of the bloodystrike at a Rockefeller-- owned coal mine in Colorado.

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Objectives of Industrial Relations

Congenial Labor Management relations Regulate the production by minimizing industrial

conflict thereby contributing to Economic Progress

Workers to have a say in Decision Making Encourage and Develop Trade Union Avoiding Industrial Conflicts

To boost the Discipline and Morale of Workers

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Players in Industrial Relations

There are Three Major players in I Rs

1. Management / Employers

2. Labour /Workers /Employees3. Government / RegulatorThe Main Objective of IRs

To maintain harmonious relationsbetween all the three major players and

To contribute to economic prosperity of

the country.

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Employee Improve their Condition of Employment

Views in any Grievances

Exchange views and ideas with Management

Share in Decision Making

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Trade Unions

To redress the bargaining power of Individual

worker.

To secure improved terms and conditions of

employment.

To secure improved status for the worker in his or

her work.

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EmployerThe Employer see IR as

Creating and Maintaining EmployeeMotivation

Obtaining Commitment from Workforce

Achieving High Levels of Efficiency

Negotiating Terms and Conditions of

Employment

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Government

The Govt. regulates the relationship between

the Management and the Labour and seeks

to protect the interests of both the groups.

The Authority of the Courts to settle legal

disputes.

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IR covers some of the followingAreas

Collective Bargaining : Negotiation about working conditions and terms

of employment between employer and employee to reach an

agreement

Role of Management, Unions and Government

Machinery for Resolution of Industrial Disputes :Works Committee ,

Conciliatory officer( settlement) ,labor courts etc.

Grievances, labor welfare and security

Trade unions, workers participation

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Difference Between IR&HRM

Dimension Human Resources Mgmt. Industrial Relations

Parties Two: Employee, Employers Four: Employers, Employees, TradeUnion & Govt.

Contact Individual employee contacts immediatesupervisor

Employees contact even the TopMgmt. as a group

Concern Overall Mgmt. of all Resources includingworkers, staff, executives, top mgmt.and even suppliers and customers

Relations between Actual Work forceand Mgmt. of Org.

Mode of Resolving Grievance and Disciplinary Procedure Collective Bargaining and other

forms of industrial conflicts

Purpose Accomplishment of org, goals Maintain Harmonious Relationsbetween Employers and Employees

Scope Whole includes IR as well Concerned with relations betweenemployees and employers.

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Causes of Poor Industrial

Relations Uninteresting nature of work :Due to AutomationRole of Workerreduced

Political Nature of Unions : inter union rivalry, multiple unions, politicalparties involvement

Poor Wages : Inequity in Wages , complicated wage system

Occupational Instability : Do not want changes in the job-fear ofinsecurity

Resistance to change, frustration and social cost , multiplier effect (totalloss)

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Approaches to IR:Systems Approach

Systems framework by John Dunlop

Actors

Environmentalcontents

Ideology

input

bargaining

Conciliation

arbitration

process Rules

settlement

output

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Actors:Managers, Workers and Government agencies

Actors influenced by several Forces in Environment

technology, markets and power relations in society

Ideology: Though there is conflict among the actors butthere is also a shared ideology and compatibility of ideas

which help to resolve conflict by framing rules

The network or web of rules

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Unitary Approach

The organisation is, or should be, an integratedgroup of people with a single authority/loyaltystructure and a set of common values, interestsand objectives shared by all members of theorganisation.

Management's Prerogative (i.e. its right to manageand make decisions) is regarded as legitimate,rational and Accepted.

Conflict is perceived as disruptive and as a result

of agitators, interpersonal friction andcommunication breakdown. Opposition to it (whether formal or informal,

internal or external) is seen as irrational

Trade Unions are deemed as unnecessary

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Pluralist Approach

Based on assumption that organization iscomposed of individuals who make up distinctsectional groups , each with its own interests ,objectives and leadership.

The two predominant sub-groups in thepluralistic perspective are the management andtrade unions.

The role of management would lean less towardsenforcing and controlling and more towardpersuasion and co-ordination. But focus will be on ofregulating work relationships-balance of power betweenmanagement and trade unions.

Conflict is necessary ,but it can be and needs to be managedand resolved

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Radical Perspective

This view of industrial relations looks at the nature of the capitalistsociety, where there is a fundamental division of interest betweencapital and labour, and sees workplace relations against thisbackground..

This perspective sees inequalities of power and economic wealth ashaving their roots in the nature of the capitalist economic system.

Conflict is seen as inevitable and trade unions are a natural

response of workers to their exploitation by capital. Whilst theremay be periods of acquiescence, the radical view would be thatinstitutions of joint regulation would enhance rather than limitmanagement's position as they presume the continuation ofcapitalism rather than challenge it.

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Trusteeship

Proposed by Mahatma Gandhi

Company Accepts its total responsibility andmanagement role becomes that of balancing all theclaims upon the company.

Inherent responsibility to its consumers, workers,shareholders, and the community

Greater good

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Industrial Relations Today

By many accounts, industrial relations today is incrisis.

In academia, its traditional positions are

threatened on one side by the dominance ofmainstream economics and organizationalbehavior, and on the other by post-modernism..

In policy-making circles, the industrial relationsemphasis on institutional intervention is trumpedby a neo-liberal emphasis on the laissez fairepromotion of free markets.

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Industrial Relations Today contd

In practice, labor unions are declining and fewercompanies have industrial relations functions..

The number of academic programs in industrial relationsis therefore shrinking, and scholars are leaving the fieldfor other areas, especially human resource managementand organizational behavior.

The importance of work, however, is stronger than ever,and the lessons of industrial relations remain vital. Thechallenge for industrial relations is to re-- establish theseconnections with the broader academic, policy, and

business worlds

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Gruesome killing of LalitChoudhary,CEO&MDof Graziano

Transmission India Pvt ltd in 2008 Murder of VP-HR of Pricol

All these sequel to sacking-looming crisis.

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Suggestions to Improve IRs

Both Management and Union shoulddevelop constructive attitude towards

each other.All basic policies and procedures relating

to IR should be clearly communicated to

all i.e., free flow of communication. Right kind of Union Leadership

Share more..

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Sound Industrial Relations Systemcontd..

A sound industrial relations system is one in whichrelationships between management and employees (and

their representatives) on the one hand, and betweenthem and the State on the other, are more harmoniousand co-operative than conflict and creates anenvironment conducive to economic efficiency and themotivation, productivity and development of the

employee and generates employee loyalty and mutualtrust.

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Sound Industrial Relations System contd..

Industrial relations itself may again be described

as being concerned with the rules, processesand mechanisms (and the results emanatingthere from) through which the relationshipbetween employers and employees and their

respective representatives, as well as betweenthem on the one hand and the State and itsagencies on the other, is regulated

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Sound Industrial Relations Systemcontd..

Industrial relations seek to balance the economicefficiency of organizations with equity, justiceand the development of the individual, to findways of avoiding, minimizing and resolvingdisputes and conflict and to promoteharmonious relations between and among the

actors directly involved, and society as a whole.

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Role of Players:

Governments Role In IR

The essential challenge for governments in theregion in the face of globalization is to seek toencourage and regulate foreign participation innational economic development in a manner

that promotes balanced growth with equity..

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Employers Roles In IR

Proactive and preventive, the need for sound

workplace relations which emphasise theimportance of improved cooperation andconsultation and effective negotiation to addressworkplace issues, thereby avoiding (or, at least,limiting) industrial disputes and providing a basisfor achieving sustainable improvements in

enterprise performance.

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Workers & Unions Role In IR

A form of unionism which focuses on working withemployers (and their organizations) in implementingstrategies to improve enterprise

competitiveness and the quality of work throughimprovements in work organization, labour managementProactive and strategic in approach Relations and Skillsdevelopment

Avoid restrictive in nature (e.g, seeking, by variousmeans, to limit change).

The development of effective unionism (and, indeed, oftrade union movements everywhere) is contingent onthe recognition and application of the rights of freedomof association, to organize and to bargain collectively

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Constitutional Frame Work of IndustrialRelations

Directive Principles of State Policy Equal Pay for Equal Work for men and women Article

39(d)

Health and Safety of workers Article 39(c) Right to Work-Article 41 Just and Humane Conditions of Work and for Maternity

Relief-Article 42 Living Wage and Decent Standard of Life of laborers--

Article 43 Participation of Workers in the Management of

undertakings or industrial establishments by suitablelegislation or otherwise-Article 43A (42nd Amendment)

L l F k f IR

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Legal Framework of IR

Labour Laws & IR Industrial Disputes Act 1947 Industrial Employment (Standing Orders) Act

1946 Trade Unions Act 1926 Factories Act 1948 Contract Labour (Regulation And Abolition) Act

1970 Payment of Wages Act 1936 Equal Remuneration Act

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Labour Laws & IR Payment Of Bonus Act 1965

Payment of Gratuity Act 1972 Employees Compensation Act 1923 Karnataka Industrial Establishments

(National And Festival Holidays Act)19631963

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Remember Dorabji Tatas statement.

The concern for the welfare of the laboringclasses must be one of the first cares ofevery employer. Any betterment of theirconditions must proceed more fromemployers downward rather than forced upby demands from below, since labor,contended, well housed, well fed andgenerally well-looked after, is not only anasset and an advantage to the employer but

serves to raise the standard of industry andlabor in the country DORABJI TATA

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COLLABORATIONNOT CONFRONTATION

A. Avoid Negative Orientation:

Opposition

Opposition leads to suspicion Suspicion leads to aggression

Aggression leads to a deadlock

Confrontational Mindset:

Counterpart= Adversary Difference= Conflict Resources= Weapon

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B. Adopt Positive Orientation:Opposition

Opposition leads to cooperation Cooperation leads to partnership Partnership leads to Settlements

Collaborative Mindset:

Counterpart= Partner

Differences= Opportunities Resources= Incentives to Cooperate.

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In short, for sound IndustrialRelations,

we need:

Participation

Coordination

Understanding

Openness

Explicitness

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Thank You