INDUSTRIAL RELATIONS AND LABOR LAWS

EMESTER

INDUSTRIAL REVOLUTION1760 : Industrial Revolution – Great Britain-

spread to other countries

1830 :France ,Belgium , USA

1850 : Sweden and Japan

1870 -80 : Canada , USSR ,Japan , India

Agrarian , Artisans – use of machines in mass production (Industrialization)

Out-workers – people working at their homes with their own tools

REPLACED BYFactory System – Owners provided premises , machinery and

means of productionWorkers supplied their labor

EMERGENCE OF TWO DISTINCT CLASSES

Capitalist WorkingClass Class

Initial stages – industrialization – workers –

uneducated , untrained and unorganized Exploitation of labour – slaves , unhygienic

working conditions , employment of children Problems / Disagreements – Management /

Workers Inability to terminate the arrangement or find

employment easily This led to both sides – studying the problems

more closely – the need for IR – began The size of modern companies – added to the

dimensions of the relationship

Labour relations departments – added – to negotiate and administer – complex contracts – with union pressures

State – stepped in – exploitation of workers Organized labour – began lobbying the

government for favorable legislation to counter the management

Personnel departments – had to monitor compliance – with labour laws

Further on – Human Resource Departments were added

IR IS A TRI-PARTITE PROCESS

LABOUR MANAGEMENT

GOVERNMENT (STATE)

INDUSTRIAL RELATIONS All matters that arise in day-to-day association

between employers , managers / supervisors and workers , and includes –

(a) Relations between supervisors / managers and individual workers

(b) collective relations between employers and trade unions ; and

(c) role of government in regulation of these relationships.

COMPONENTS OF IR Relations between manager / supervisor and

individual workers (Personnel Management)( worker – absenting , chronic alcoholism ,

insubordination) The collective relations between Employers and

Trade Unions (Collective Bargaining)( revision of wages , profit-sharing , welfare measures for

workers , improve working and living conditions) The Role of Government in the regulation of

these relationships (Labour Legislation)

NATURE/FEATURES OF IR 1) IR does not emerge in vacuum (emptiness)

– born out of ‘employment relationship’. Without – existence of two parties – labour

and management – this relationship cannot exist

Industry – provides the environment- for IR

2) IR characterisized – both conflict and co-operation (Focus of IR – study of relationships ,

practices and procedures developed by the parties to resolve or atleast minimize conflicts)

3) The study of IR includes issues like – technology of the workplace , countries socio-economic environment , political environment , Nations labour policy, attitude of TU,employers and workers.

4 ) Both the groups (labor and management) develop different orientations and perceptions of their interests.

They generally , also develop negative images about each other.

5) IR involves the role of three players viz. Management , Labor and the State

6) The concept of IR , draws heavily from a variety of disciplines like social sciences , humanities , behavioral sciences , law , economics , sociology etc.

7) The levels covered by IR , range from, individual relations at the shopfloor to the regional , national and international bodies.

OBJECTIVES OF IR To safeguard the interests labour and management securing – highest level of - mutual

understanding and goodwill among them.(TISCO)

To establish - growth of industrial democracy labor partnership in – sharing of profits & participative decision-making

To avoid - industrial conflict and strife. To raise productivity to highest levels To eliminate or minimize the number of strikes ,

lockouts and gheraos Vesting of a proprietary interest - workers in

industries - in which they are employed.

EVOLUTION OF IR IN INDIA

Divided into 4 Phases –

1) Ancient Times 2) Early British Rule 3) First World War to Pre-

Independence Period 4) Independence and After

1) Ancient TimesVedas – one of the important factors necessary for

happiness in a group or community good mutual relationsVillages – Madhymasi ( mediator) a man of position and influence in the

society – settled disputesKautilyas Arthashastra and the edicts ( an

order proclaimed by authority) of Emperor Ashoka reveal that :

workers enjoyed privileges – were paid good wages and were given sick leave and old-age

pensions.Any dispute , which could not be settled by

the local Panchayat , was disposed of by a Board appointed by the King , on the authority of the depositions of witnesses and secret agents.

During Mughals period ( specially Akbar) - the disputes were solved and decided by the Emperor himself on the advice of Kadis.

2) Early British RuleRapid expansion of Rail networkThe laborers were recruited through

JobbersWages were deducted by the employers

for late attendance , insubordination and negligence

British industrial capitalism – aim – India agricultural resources – supplying Britain with raw materials – and buying her finished and manufactured products.

1877 : First indication of industrial unrest and earliest work stoppage – Weavers of Empress Mills , Nagpur

Trade Unions informally existed – but unequal power balance

1890 : The first formal association – Bombay Millhands Association was established

1907 : Postal Union3) First World War to Pre- Independence Period World War I (1914-18) resources being used up in war-

more demand– rising profits for capitalists – not shared – economic distress brought workers together and an organized working class movement began in the country.

Worker unrest :Ahmedabad – led by Mahatma Gandhi

1921 – Madras labor unrest – led by B.P. Wadia

Trade Disputes Act (1917) Workmens Compensation Act (1923) Trade Union Act (1926)

4) Independence and After 1947 : INTUC was formed 1947 : Industrial Disputes Act enacted 1948 : The Factories Act ,The Minimum Wages Act , and

the ESI Act were all enacted in 1948. 1951 (First 5 year Plan) – great importance to the

maintenance of industrial peace 1965 – Payment of Bonus Act – to resolve the most

important cause of discord between the two parties Emergency 1975 and 1976 – IR peaceful – as strikes and

lockouts were prohibited. Automation , Mechanization , Computerization – skill

levels – IR ----------------------

CHARACTERISTICS OF INDIAN INDUSTRIAL RELATIONS SYSTEM

1. Employer / Management consider Trade Unions as a necessary evil of the Industrial system

2. The Trade Unions perceives its main task is to challenge and oppose decisions of Management

3. Trade Unions are poorly organized in the country ( grip of political parties , run in acute financial crises , dominated by outside leadership , within small groups – religion, caste and ideology)

4 . Parties in disagreement over scope of collective bargaining ( Very few agreements – arbitration)

5 . India - Agreements concluded at shopfloor level , plant level , industry level and at the National level

6 . The employers are highly organized ( play a major role in shaping the countries wages and labor policies

8 . The Indian Industrial Relations system is slowly changing over time.

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ROLE OF WORKERS , MANAGEMENT AND THE STATE

WORKERS Alienated , monotonous ,and unhygienic

work environment – activities closely regulated and controlled by managerial personnel- workers dissatisfaction with the system- revolt – so workers form unions

Safeguarding worker’s interests The workers organizations have become

political institutions – with the specific purpose of securing concessions from employers

They acquire power , status , authority through membership of Unions.

Pressurize Management for better wages , improvement in working conditions and more amenities .

MANAGEMENT They provide jobs to workers and lay down

terms and conditions for work. They are strongly organized. Workers are often intimidated / victimized by

Management – sometimes the opposite happens

The philosophy of the Management often decides the state of Industrial Relations

The State In the system of Industrial Relations , the

Govt. acts as a judge and regulator State emerged as one of the largest single

employer in the country Labor Office / Labor Commissioner Labor Courts Labor Ministry Govt. now trying to strike a fair balance

between the demand of liberalization and expectation of its workforce.

TRADE UNIONSDefinition – Trade Union Act , 1926o Any combination ( association)o Whether temporary or permanento formed primarily for the purpose of regulating

the relations between workers and employerso or for imposing restrictive conditions on any

trade or business ( irrational , arbitrary and illegal actions of employers )

o and includes any federation of two or more unions

Non-legislative definition – Trade Union‘ An organization of workers acting

collectively , who seek to protect and promote their mutual interests through collective bargaining ‘

TRADE UNIONS TU – To fill vacuum – created by industrial

revolution – in the industrial society Individual dispensability and collective

indispensability – basic principle for its formation

Philosophy – ‘ United we stand and divided we fall’

The Government philosophy – of Laissez – faire – left the working class – at the mercy of employers

The worker lacked bargaining power Supply of labour was more and demand

was less Employers employed on their own terms

– which were exploitative The exploitation of labor was at its peak Combination of workers was considered

as ‘ criminal conspiracy’ Discontent was brewing Marxism – fanned the discontent – and

gave birth to an institution - ‘Trade Union’.

FORMATIVE STAGES OF TRADE UNIONS

Trade Unions – initial years – difficult and hostile period

Employers – crush them – iron hands Subsequently – period of agitation – and

occasional acceptance – also the period of struggle

Employers – were forced to – accommodate – tolerate and hesitatingly – accept them

Then – period of understanding – collective bargaining in industry

Unions matured – employers started consulting them

Desired stage – Fusion stage – joint efforts- for union ; management cooperation and partnership

TRADE UNIONS IN INDIA

SOME MAJOR TRADE UNIONS IN INDIA All India Trade Union Congress-AITUC- (

Communist Party of India)

Bharatiya Mazdoor Sangh –BMS- (Rashtriya Swayamsevak Sangh)

Indian National Trade Union Congress-INTUC- (Indian National Congress)

New Trade Union Initiative (Independent from political parties, but left)

Centre of Indian Trade Unions – CITU (Communist Party of India (Marxist))

Hind Mazdoor Sabha- HMS - (socialists)

Labour Progressive Federation (Dravida Munnetra Kazhagam)

Trade Union Coordination Committee (All India Forward Bloc)

PROMINENT TRADE UNIONISTS OF INDIA

V.V. Giri (AITUC) Lala Lajpat Rai ( Founder – AITUC) S.A. Dange (founders of Communist

Party of India) Datta Samant (INTUC) N.M. Joshi (AITUC) B.T. Ranadive (AITUC , subsequently

formation of CITU)

2008 While the biggest gainer is the Rashtriya

Swayamsevak Sangh-backed Bharatiya Mazdoor Sangh (BMS), (60 Lakh) which has added almost 33 lakh members to its 1996 strength of 27 lakh,

The Congress-supported Indian National Trade Union Congress ranks second in the list of 10 central unions with (38 lakh) members as against 24 lakh in the previous survey.

the CPI-affiliated All-India Trade Union Congress has moved to the third position with (33 lakh) members from the fifth slot in 1996 when its membership was nine lakh.

The Hind Mazdoor Sabha, ranked fourth, has added about 18 lakh new members, taking its enrolment to (32 lakh).

Unorganised sector The increase in membership is largely from the

unorganised sector such as plantation, agricultural , beedi workers, and cart-pullers.

It is believed that the BMS has gained primarily on RSS `ideology' without being a militant organisation. The mobilisation is basically on Hindu `ideology.'

2013Going by data from various trade unions, submitted by them to the union labour ministry as part of the survey :

The Indian National Trade Union Congress (INTUC), affiliated to the Congress party, has emerged as the biggest of the seven central trade unions, with a membership of 33.3 million.

This is also more than the total membership size of all trade unions in the previous survey conducted in 2008, signifying a giant leap in the size of unions, coinciding with the economic slowdown, which was supposed to push workers into the arms of unions.

.

The Bharatiya Mazdoor Sangh (BMS), lenient to the Bharatiya Janata Party (BJP), is in second place after INTUC, with 17.1 million members.

In the 2008 survey, BMS had been the leader, with a membership of 6.6 million, while with 3.9 million members, INTUC held the second position.

.

The All India Trade Union Congress (AITUC), affiliated to the Communist Party of India, has retained the number three slot with a 14.2 million membership

Following it is the Hind Mazdoor Sabha (HMS), an independent union, with 9.1 million members, up from 3.2 million in 2008.

GENERAL FEATURES OF TRADE UNIONS1) The TU is an association either of employers or

employees like – General Labor Unions Employers Associations ( Bombay Mill

Owners Association , Tea Planters Association of North India , Indian Paper Mills Association )

Combination of intellectual labor ( All India Teachers Association , All India Medical Doctors Association , All India Bank Employees Association)

2) Labor unions are relatively permanent association of workers and are not temporary or casual

Persist throughout the years Purpose not immediate but continuous

3) A Trade Union is an association of workers who are engaged in securing economic benefits for its members.

To secure control of the supply of labor in one or more markets

Maintain that control as a means of fixing the price of labor as well as conditions under which it works.

Contemporary approach of Trade Unions –a. Protection of workers and provision for their securityb. Improving the wages , conditions of work and standards of

living.c. Raising the status of the workers as a part of industry and

citizen of society.d. Contributing to nation’s socio-economic development.4) The origin and growth of trade unions have been influenced

by a number of ideologies- Communism - Karl Marx – Theory of Class War , class-conflict

– change in social order-overthrow the capitalist class Socialism – upliftment of all sections of society –trade

unionism extension of the ‘principle of democracy’.

5)The character of Trade Unions has been constantly changing :

from illegal activities , they have become legalized and recognized institutions

From small bodies they have become gigantic institutions

They now contribute to the social , cultural , economic and political development of the country.

STRUCTURE OF TRADE UNIONS IN INDIA

Local level State level National level The National Federations The central union organizations are national

federations of labour based on different political ideologies.

Some of the trade union leaders are MP’s , MLA’s , elder man of city corporations.

A majority of these federations allow their affiliates to bargain independently with their respective employers.

Function through : Affiliated unions General council ( including office-bearers) Working committees Pradesh bodies

WHITE-COLLAR TRADE UNIONS Earlier - Unions and Strikes – known only to

blue-collared workers in factories , mines , docks etc.

Doctors , Engineers , Lawyers , Teachers and managerial staffs – thought it below their dignity- to march streets – and yell slogans

Today – Trade Unions exist – among white collared employees

Employees in Banks , Teachers , Lawyers , LIC Officers – organized

They take recourse to – strikes , mass casual leaves , dharnas and gheraos

All India Defense Employees Federation

All India LIC Employees Federation Indian Federation of Working

Journalists All India Bank Employees Association Indian Medical Association RBI Officers Association

EMPLOYERS ASSOCIATIONS Employer’s organizations (EO’s) are

composed of enterprises The Trade Union Act , 1926 – includes in its

purview – both associations of workers + employers

The Chambers of Commerce – usually set up – defend the economic interests of employers – In some countries – UK , Norway and Jordan – the same organization deals with economic interests – as well as industrial relations

The Royal Commission on Labor – recommended – Indian employers need an organization ‘ to deal with labor problems – from the employer’s point of view

1920 – ASSOCHAM – Associated Chambers of Commerce

1927 – FICCI- Federation of Indian Chamber of Commerce and Industry

ILO - Treaty of Versailles – terms – technical – FICCI – AIOE ( All India Organization of Employers)

ASSOCHAM – EFI ( Employer’s Federation ofIndia) 1970 – public sector – SCOPE – Standing

Conference on Public Enterprises

After several initiatives and meetings – 1956 – AIOE and EFI included CIE (Council of Indian Employers) – to ensure closer cooperation and coordination – between the two bodies – which together represent – the interests of large-scale industry in India

1973 – SCOPE joined the CIECOUNCIL OF INDIAN EMPLOYERS (CIE) To discuss matters coming up with the ILO and

Industrial committees Policy and attitude of Indian employers – with

employers of other countries Discuss problems confronting Indian Employers Select members of Indian Employers Delegation to

ILO Conferences and committees.