ABOUT disputes on the rise, the need for amicable industrial relations has achieved critical importance. Industrial relations deals with the relationship between workers of an organization

ABOUT

This document is a White Paper on the subject of industrial relations in India, and specific to the topic of sustaining economic growth and development by creating an equitable and strife free work place. This White Paper is created in conjunction with 'The 5th IR & HR Summit 2012' organized by the Western region chapter of the Confederation of Indian Industry in November 2012.

This Paper elaborates on the various perspectives brought together by eminent personalities at the Summit, and helps identify the key issues with regards each of the stakeholders and the way forward.

ACKNOWLEDGEMENTS

Aon Hewitt would like to thank the CII and the ICICI Group for their support in creating this White Paper. Aon Hewitt would also like to thank the professionals and academicians from various industries and institutions who provided their valuable insights and time towards the creation of this White Paper.

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Industrial progress plays an important role in the growth of the Indian economy. Some of the key factors necessary for sustaining economic growth and development through industries are – Adequate Infrastructure, Access to Capital, Trade Liberalization, Competent Personnel and Amicable Industrial Relations. Since the past few years, with workplace disputes on the rise, the need for amicable industrial relations has achieved critical importance. Industrial relations deals with the relationship between workers of an organization and its management. As workers form the largest section of the employed workforce, and represent a significant part of the social strata, industrial relations has a far reaching impact on the well being of workers, societies and nations.

In the context of the manufacturing industry, the key stakeholders typically involved in industrial relations are – Primary: Government, Employers, Workers and Trade Unions, Secondary: Industry Bodies and Society. The role of trade unions has evolved since their inception centuries ago. Today, trade unions work towards the Economic, Social and Intellectual progress of workers.

The 5th IR & HR Summit, organized by the Western region chapter of CII, brought together thought leaders from the public and private sector, civil society, trade unions and the government to share their opinion sand debate on three crucial perspectives which underpin the theme of 'Sustaining Economic Growth & Development: Creating an Equitable & Strife free Workplace'. The debate themes were:

Do equitable and just practices at the workplace make Unions redundant?

Archaic and inflexible labour laws create strife at work place

Bad practices of management or opportunistic practices of union leaders – Who is more responsible for criminalization of trade unions?

The discussions led to the conclusion that amicable industrial relations is a collective responsibility of all the stakeholders, and that it is in their best interests too.

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The desired role to be played by the primary stakeholders and the gap existing today can be understood by evaluating the Intent, Framework and Execution of these stakeholders. This analysis leads to the following immediate steps to be taken by the stakeholders:

Organizations to mete out respectable treatment to their workers, and ensure meeting of all the hygiene factors, through a positive organization culture

Workers not to misuse the labour laws meant to protect them, and trade union leaders to act as moderators between the employer and workers

Government to create strong deterrents for mala fide acts by either stakeholder, and review labour and other related laws to promote fair treatment

Additionally, a roundtable can be convened comprising industry bodies, trade unions and the government to discuss and deliberate on the key emergent issues.

While these steps will address the concern and control further disputes, the need in the long run is to identify a cure. One of the approaches to achieve the same is to equate the factors of engagement for white and blue collared employees with the management. Today, the basis of engagement of blue collared employees with the management is Protection. It is important to transition this to Performance, which is the basis of engagement of white collared employees with the management. In other words, the purpose and function of industrial relations and human relations should be aligned, not distinct.

This equity is the desired objective of all organizations employing workers, as workers will continue to be better connected, mobile and more aspirational and soon be no distinct from white collared employees.

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TA

BLE O

F C

ON

TEN

TS A. INTRODUCTION 5

B. HISTORICAL PERSPECTIVE 8

a) Industrial Relations

b) Trade Unions

C. TRADE UNIONS IN SERVICE INDUSTRY 11

a) Airlines

b) Retail

c) IT / ITeS

D. STAKEHOLDERS 13

a) Government

b) Employers

c) Workers

d) Trade Unions

e) Industry Bodies

f) Society

E. THE 5TH IR & HR SUMMIT 15

a) Inaugural Session

b) Debate Theme 1: Do equitable

and just practices at the workplace

make Unions redundant?

c) Debate Theme 2: Archaic and

inflexible labour laws create strife

at work place

d) Debate Theme 3: Bad practices

of management or opportunistic

practices of union leaders

– Who is more responsible for

criminalization of trade unions?

F. ANALYSIS OF THE ROLES OF

THE STAKEHOLDERS 28

a) Intent

b) Framework

c) Execution

G. THE WAY AHEAD 38

H. CONCLUSION 43

ANNEXURES 45

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India is home to over 1.2 billion people. Being the second most populous country and only the seventh largest in area, the world's largest democracy has encountered many challenges in managing its people and its economy. Industries have played a significant role in helping the nation cope with these challenges, and achieve a high growth rate, making it one of the most attractive investment destinations and markets in the world today.

Post-independence, the agriculture and industrial sectors were the key drivers of the economy. However, over the past 50 years, the contribution of the agriculture sector has declined from 50% to only about 18% today. The contribution of the industrial sector peaked at about 28% in early 80s and late 90s, only to reduce to about 26% today.

One of the reasons of the sharp decline in their contributions has been the rise of the services industry, which contributes about 56% of the GDP of the country today. However, if India is to retain and improve its market attractiveness, and achieve the desired levels of growth, all the major industries have to operate efficiently, and produce goods and services of the highest quality.

Some of the key factors necessary for sustaining economic growth and development through

1industries are:

Amicable Industrial Relations

Access to Capital

Competent Personnel

Adequate Infrastructure

Trade Liberalization

Fig 1 – Factors for sustaining economic growth and development through industries

Sustaining Economic Growth & Development: Creating an Equitable & Strife free Workplace

INTRODUCTION

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1References – OECD: Sustaining High and

Inclusive Growth in India, October 2012 and

IAS Working Paper# 106, K Narayanan and T

Palanivel

While each of these factors is of critical significance for an economy, some of these have assumed levels of crucial importance in the context of our nation. One of them is the need for 'amicable industrial relations'.

Industrial relations refers to the relationship shared by the management and the workers of an organization. In the early years post-independence, the industrial relations system in India sought to control conflicts and disputes through excessive labour legislations. These labour laws were largely protective in nature and covered a wide range of aspects of workplace industrial relations such as laws on health and safety of labour, layoffs and retrenchment policies, and industrial disputes. The basic purpose of these laws was to protect labour, and eventually the broader society.

With the advent of liberalization two decades ago, there was a shift in the basic philosophy to industrial relations policies. There was a need to balance the policies with the needs of all stakeholders of industrial relations. Employers sought workforce reduction

through technological automation, and strove for policies offering flexibility in the workplace. Furthermore, globalization brought major changes in the Indian manufacturing scenario which reinforced the contrasting needs and perspectives of employers and workers.

Unfortunately, these differences have resulted in an increase in the number of untoward incidents of violence in the workplace. The past five years alone have witnessed the deaths of several representatives of management and those of the working class, even in the most premier organizations in the country. While industry and the community at large have been alarmed about the rising differences, a constant recurrence of the same incidents and practices, (of which the one in Manesar in August 2012 is a strong case in point) has led to a furore of viewpoints and calls for action from many quarters.


INTRODUCTION

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With a view to achieve an objective and unbiased perspective of relationships between the employer and worker, the western region

thchapter of CII, organized its 5 IR & HR Summit in November 2012. The fundamental theme of the Summit was 'Sustaining Economic Growth & Development by Creating an Equitable and Strife-free Workplace'. The Summit involved debates, on three key topics pertaining to the theme, by

eminent personalities representing the various stakeholders involved in industrial relations.

The objective of this Paper is to address the key issues discussed in the Summit and analyse the situation as well as to provide a way ahead for each of the stakeholders, so that economic growth and development may be sustained.


INTRODUCTION

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To understand the current state of industrial relations, it is important to trace its history, and outline its key purposes and motives.

HISTORICAL PERSPECTIVE

a) INDUSTRIAL RELATIONS

Organized industrial work can be dated back to circa 2600 BC in Ancient Egypt when Imhotep (priest, architect, astronomer and physician) planned and built a tomb near Cairo, in the form of a pyramid, for the pharaoh Djoser. Building pyramids was a large scale activity, involving considerable planning and tremendous human effort. The builders had to provide for the labour and built 'pyramid cities' for them to live in and offered them tax breaks. In this way, to manage the large scale construction, a formal relationship was established between builders and labour. Thus, from a time over four millennia ago, the origins of industrial relations can be traced.

Industrial relations deals with the relationship between employees of an industry and its management. In the present day context, while human relations or HR usually deals with the entire organization, industrial relations or IR are specific to workers on the shop floor in a factory environment. As workers form the largest section of the employed workforce, and represent a significant part of the social strata, industrial relations has a far reaching impact on the well being of workers, societies and nations.

Apart from the workers and the management who are the primary stakeholders in industrial relations, the government plays an important role, through its industrial policies and representatives. Another key player in the gamut of industrial relations is the trade union. Since its inception centuries ago, trade unions have played a pivotal role in industrial relations.

b) TRADE UNIONS

The history of trade unions can be traced to the guilds of the medieval era, which comprised artisans of a specific skill set and created guidelines for their activities and prices, and in effect protected their interests. The modern day trade unions were first formed in Britain during the industrial revolution by skilled workers, to protect themselves against the rampant exploitation by the employers. In the early years, many attempts were made to suppress these unions, and strikes of any form were declared illegal. However, the trade union movement gathered momentum,

thand by the 19 century had generated a political inclination, with the formation of the Independent Labour Party. It wasn't long before the trade union movement was to find its way to the colonies of its origin country.

Sustaining Economic Growth & Development: Creating an Equitable & Strife free Workplace 8


The first ever demand for the regulation of the working conditions in Indian factories originated from the Lancashire textile capitalist lobby. The lobby viewed the emergence of a competitive rival in the Indian textile industry under favourable conditions as a force which could threaten their position. Hence the lobby demanded the appointment of a commission for an investigation into the factory conditions and the working condition of the labour force. The first commission was appointed in 1875, although the first Factory Act (defining the minimum employment age and working hours for children) was not passed until 1881. This gave impetus to the trade union movement in British India.

The movement got another impetus when the Bombay Mill Hands Association was formed in April 1890. The establishment of the International Labour Organizations in 1919 added an international flavour to the scene and provided a source of inspiration for the workers to

become politically conscious. India's membership to the same exerted great influence in the formation of a central organization of workers called All India Trade Union Congress (AITUC) in 1920 for the purpose of conducting and coordinating the activities of the labour organizations.

The period from 1924 to 1935 is considered as the era of revolutionary trade union movement in India. MN Roy, Muzaffer Ahmed, SA Dange and Shaukat Osmani led the trade union movements and as a result the political consciousness among industrial workers increased. The First World War and its consequences brought a period of soaring prices, unprecedented exploitation by the industrialists, and considerably low wages for the workers. The emergence of Mahatma Gandhi led to the growth of non-violent trend of the nationalist struggle, which mobilized the suffering workers and peasants for the national cause, thus adding to their unity.


Improve working and living conditions and to represent workers’ interests in various fora

Offer responsive consideration in improving levels of production and productivity, discipline, and high standards of quality

Secure fair wages for the workers

Enlarge opportunities for promotion and training

Promote identity of workers’ interests with their industries

Cooperate in and facilitate technological advancement by broadening workers’ understanding of the underlying issues


Over the years, trade unions have stepped up their agenda from handling basic rights of workers such as minimum wages to now including social rights of the workers as well. The primary functions of a trade been detailed in Figure 2.

2 union have

Fig 2 – Primary Functions of a Trade Union

Provide housing and organize cooperative societies to improve the quality of the workers’ lives

Enhance workers’ knowledge of the work environment and inform them their rights and responsibilities, and the systems and procedures

Publish newsletter, magazine to clarify their policy or stance and pass on information about their activities


In addition, trade unions also serve ancillary functions in society (as demonstrated in Figure 3).

It is thus evident that trade unions have a significant role to play in influencing industrial relations. While they fundamentally represent the workers and their best interests, they have the capability to act as tools that can influence the decisions of employers.

Welfare Activities Education Communication

Fig 3 – Ancillary Functions of a Trade Union

2References – Asian Academy of Management Journal, Vol. 14, No.1, 37-57,

January 2009: The Changing roles of trade unions in India: NTPC, Unchahar

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In India, trade unions operate predominantly in the manufacturing sector. However, the services sector, which contributes the most towards the Indian GDP, also has industries in which the workforce is unionized. Additionally, in some services industries, the debate on unionization is in progress.

TRADE UNIONS IN SERVICE INDUSTRY

a) Airlines

The Airlines industry, which has come to prominence since liberalization, has trade unions for employees of different vocations. Separate unions are identified for different groups of employees such as pilots and ground staff. The recent past has observed many instances of conflict, although not violent, between the employers and unions, especially those of the pilots. The primary cause of the conflicts has been lack of timely salaries to the employees and a demand for increase in pay. This has been driven due to the nature of the airlines business, which is highly capital intensive, and has a very high breakeven point, and also due to lack of effective management of organizations. Presently, there exists a demand to create an apex trade union for the airlines industry, and create a common union of all employees for an organization, than to have distinct bodies representing different sections of the workforce for the management to deal with.

The factors impacting relations between employees and employers in the airlines industry are different from those in manufacturing, as the airlines employees' social and economic profile differs from that of the

workers in manufacturing. However, despite this, the airlines managements' and employees' intent, framework and execution are not dissimilar from those in manufacturing. Hence, the recommended measures for better industrial relations are applicable to the airlines industry too.

b) Retail

The retail industry has grown rapidly in the past decade, and is set to achieve greater progress, with the recent thrust towards liberalizing the sector and attracting more investments. This growth has resulted in a spurt in employment across levels, especially at in-store employee level. While, present labour laws do not allow for unionization of employees in the retail industry, there is a strong case for mandating recognition of a trade union of retail employees, due to their relative similarity to workers in a manufacturing organization. Many European and American nations allow unionization in the retail industry. If the Indian retail industry is to become similar to that in Europe and America in its structure and functioning, then necessitating the recognition of retail trade unions may be a reasonable decision.


TRADE UNIONS IN SERVICE INDUSTRY

c) IT / ITeS

The IT/ITeS industry employs about 2.8 million people in India, and has grown at one of fastest rates even among the service sector industries. Today, India's labour laws do not recognize trade unions formed in this sector. However, analysing the nature of work (though not involving physical labour) in essence is not very distinct from that of a worker in a manufacturing industry. This coupled with instances of overburdening of work on employees, and a need for protection of rights and better provisioning of security for employees has prompted an active debate on the introduction of trade unions in the IT and ITeS

industries. While Central trade unions such as CITU have demanded this move, employers are anxious that the introduction of trade unions will severely reduce the efficiency and competitiveness of their organizations.

However, many employees, owing to their social and economic background, view trade unions in a negative light and are not in favour of introducing and participating in them. Hence, even if trade unions are recognized in IT and ITeS industries, their practices and functioning should be distinct from those in manufacturing industries.


The gamut of industrial relations includes several stakeholders, some of which are primary in nature, and play an active role in its functioning, while others implicitly impact the discipline, but play an important role nevertheless.

STAKEHOLDERS

a) Government

Government plays an important role in a country's industrial relations. It provides a productive platform to all the other stakeholders to fulfil their own interests and contribute to the economy at large. According to the Global Competitiveness Report of the World Economic Forum, an economy like India's needs strong institutions. The government is the source of the laws, policies and institutions necessary for ensuring productive industrial relations. In addition to being the regulator, the government is also one of the largest employers in India. Thus, it has to set precedence in creating policies and institutions which promote equity and also implement and abide by its own laws.

b) Employers

The employers (or management) have a significant role to play in maintaining smooth industrial relations. An employer creates the working environment in which the workforce operates, assigns work and pays out salaries (and other benefits) to its employees. In the past, viewing the employer as the master was not uncommon. However, with more organizations being managed professionally and the information &aspiration gap in the society reducing, employers are now more open and even necessitated to managing their workers equitably.


Industrial Relations

Government

Employers

Workers Trade Unions

Industry Bodies

Society

Fig 4 – Industrial Relations' Stakeholders

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STAKEHOLDERS

c) Workers

3 The Indian workforce comprises about 60% rural workers, 8% workers in the organized sector, and the remaining 32% in the urban informal sector (including the ones in the service sector). In the context of industrial relations, the workers in the organized and urban informal sector (total 40%) are of relevance. One of the fundamental purposes of industrial relations is to ensure the well-being of workers.

d) Trade Unions

As elaborated earlier, a trade union is a collective formed by the workers. Indian laws allow workers in the organized sector to form trade unions. They play a highly centric role in industrial relations, and much debate on industrial conflict involves them.

3References – Unorganized sector workforce

in India, May 2006 – S Sakthivel, Pinaki

Joddar, and

http://www.industrialrelations.naukrihub.c

om/labor-market.html

e) Industry Bodies

Industry bodies are collectives of organizations. Their fundamental purpose is to bring organizations together and discuss matters of common interest. In the recent past, with alarming escalations in industrial relations, industry bodies such as CII have come forward to enable debate so that organizations can be better aware of the issues at hand and take necessary action. While industry bodies may not be primary stakeholders in industrial relations, they can influence policy making, and educate organizations in matters of industrial relations.

f) Society

Though the society does not play a primary role in matters of the industry, it is a significant stakeholder in industrial relations. As workers and their families form the largest section of society, any subject directly dealing with the workers, is of interest to society. Additionally, owing to India's unique background, much of industrial relations are a reflection of the societal relationships. The perception that owner is the master and worker the slave, emerges from the societal structure from an India, of not a very distant past. Thus society impacts and is impacted by industrial relations.


The 5th IR & HR Summit, brought together thought leaders from the public and private sector, civil society, trade unions and the government to share their perspective and debate on three crucial perspectives which underpin the theme of 'Sustaining Economic Growth & Development: Creating an Equitable & Strife free Workplace'.Each of the discussions drew diverse perspectives from the speakers, which have been elaborated below.

a) Inaugural Session

The Keynote Speaker, Justice Srikrishna, described industrial relations as the creative tension that ensures equilibrium between management and employees. He was of the view that as long as profit maximization continued to be the key objective of managements, it would be quite impossible for fairness, justice and equity to be the drivers of industrial relations. It is incumbent upon management to practice self-regulation, and keep the interests of all stakeholders at the centre of all decisions, within the overarching goal of business sustainability. He emphasized the need for an egalitarian workplace,

and also felt that the role of the government should be restricted to creation of a fair and practical legal framework, relevant to current business and societal requirements, and rigorous implementation of the same. He concluded by exhorting both management and unions to do soul searching and genuinely believe and practice the adage of “Do not do to others what you do not want done to yourself”for avoiding strife at the workplace. He cautioned that till “greed” continued to dictate actions, it would be difficult to imagine a strife free workplace.

THE 5TH IR & HR SUMMIT




The Chief Guest, Mr. K.V. Kamath touched upon various relevant aspects of the employer – employee relationship across sectors. He advocated the view that as long as management was able to treat all employees in a fair and equitable manner (as is typically done in the services sector), the need to unionize would diminish, and along with this the irritants which lead to strife in the workplace would be eliminated. He commented on the impact of technology, which has led to a proliferation of information availability to all sections of society, leading to a reduction in the asymmetry of the

past. This was proving to be a great social equalizer, which is changing the dynamics of the employer-employee relationship. Mr. Kamath also identified an urgent need to address the issue of employability and skilling of the workforce, which is proving to be a challenge in the current volatile business environment. A highly skilled workforce is a great enabler for a country in difficult times. He emphasized the need for a constructive dialogue to create an effective industrial relations eco-system, and reiterated that this was the only way to arrive at relevant win-win solutions.

b) Debate Theme 1: Do equitable and just practices at the workplace make Unions redundant?

This discussion was moderated by Mr. Allen Sequeira, Advisor – Group HR, Mahindra Group, and the speakers were:

Mr. Kiran Karnik - Indian Administrator and Former President, NASSCOM

Dr. Prasenjit Bose - Leftist Economist

Mr. KBS Anand - Managing Director and Chief Executive Officer, Asian Paints Ltd

Mr. Pranoyjoy Guha Thakurta - Editor and Commentator, The Asian Age

Mr. Shekhar Gupta - Editor in Chief, The Indian Express synthesized the outcome of the session.

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Excerpts from the discussion:

Trade unions have played an integral role in industries in India for almost a century. Their role has evolved from ensuring protection of basic rights, to now working towards a platform for meeting larger aspirations. However, since globalization, the industry scenario is changing, organizations are demanded to be

more sensitive to their employees' needs, and the social divide is slowly, yet gradually diminishing. This has brought about a debate on the relevance of trade unions, if organizations are equitable and just in their industrial relations practices.

The fundamental premise of the debate's theme itself can be questioned because the perception of what is equitable and just may vary for each stakeholder. What the management may deem to be equitable and just, may not be

considered so by the workers. Hence, the management can never guarantee equitable and just practices, and the intervention of unions is necessary to preserve the rights of the workers.

1. Perception of 'what is equitable and just' will vary:

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It is a widely acknowledged fact that unions help in maintaining checks and balances in an organization. They play a significant role in maintaining wage equity in the organization, and ensure that the workers' actions are towards the well-being of the organization. Most importantly, they represent the collective interest of a large stakeholder population. The very nature of the employer–employee relationship leads to a power asymmetry between the stakeholder, and unions are necessary to preserve 'Industrial Democracy'. Furthermore, unions bring in an external perspective, through their linkages and affiliations with other unions, thus

ensuring that management practices align with those in the market. Hence it can be stated that unions in reality ensure the equity and fairness between management and workers, and hence cannot be made redundant. Additionally, the formation of unions is a fundamental right, and hence cannot be done away. Unions should strive to have a genuine interest in the growth and sustainability of their employer organizations, and once this approach is adopted, unions can play a very constructive role in ensuring a win-win relationship with employers.

2. Unions are necessary, as they bring balance to an organization:

Today's worker is better endowed with information and aspirations, thanks to the recent technology revolution in India. While society continues to be hierarchical, the aspirations gap between various strata is narrowing at a fast pace. A parallel can be drawn with the Indian Armed Forces, where the earlier distinctions between the outlook of jawans and officers are less conspicuous today. The root cause of this is again the shrinking gaps in social standing and

aspirations between the jawans and officers. The same holds true for the industrial scenario. Some employers have begun appreciating this fact, and hence are adhering to practices which address the workers' renewed needs. However, in many organizations today, unions continue to be necessary to ensure that the aspirations of the workers are addressed.

3. Narrowing of the aspirations gap needs to be accounted for:

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One of the strongest factors necessary for the smooth functioning of any workplace is trust. If management is able to include the workers' perspective in its decisions and actions, then its practices will become just and equitable. If it guarantees workers access to management for any issues and creates a mechanism for addressing their concerns, then the need for union is diminished. Workers should not

be treated as a 'necessary evil', but as 'necessary and constructive stakeholders', which will lead to fairness and honesty in all dealings. Communication plays a critical role in creating an atmosphere of mutual trust. In this way, by managing through trust, organizations can manage the needs of all their employees, workers included.

4. Organizations will be self-sufficient for their workforce, if they manage through trust:

Many industry observers are of the opinion that unions have outgrown their fundamental purpose. Through political linkages and external leadership, unions tend to serve the needs of a few, rather than those of their constituent workers. While this is not true of all Trade Unions, a large majority are affiliated to a political party led National Trade Union. These organizations

manipulate the local Unions to act in certain ways which are often detrimental to workplace harmony, with the key objective of furthering political gains for the parties to which they owe their allegiance. This causes a dysfunctional Union – Employer relationship which is an issue for all concerned parties.

5. The political nature of unions makes them redundant:

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Key Takeaways:To be self-sufficient to manage its workers and create a strife free environment, organizations need to:

UNIONS ARE NECESSARY IN INDUSTRIES EMPLOYERS CAN MANAGE BY THEMSELVES

Perception of 'what is equitable and just'

Bringing balance in organizations

Narrowing aspiration gap

Managing through Trust

Political nature of unions

Critical Factors:

Fig 5 – Critical Factors of Debate Theme 1

Inequity and unjust practices at workplace today are a reflection of the social divide existing in the country since ages. Some of the terminologies prevalent today in the industry, society and government (such as calling employment as Naukri, which essentially means work done by a servant) have not reconciled with the changes, globalization and the technology revolution have brought along in India. Organizations need to acknowledge the diminishing information and aspiration gap between the different strata, of which the workers are an integral part

Acknowledge the diminishing aspiration gap between the blue and white collared employees

It is essential that managements ensure equitable and just practices towards their workers, and work towards generating trust among all stakeholders. Organizations need to pre-empt the need for trust, and take the first steps for the well being of their workers, and in turn themselves.

Through these, some organizations may be able to function effectively without unions, whereas, some may still need them to manage the workers. However, it is certain that such an approach is a necessary condition for ensuring a conflict free workplace.

Demonstrate concern and trust towards workers

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c) Debate Theme 2: Archaic and inflexible labour laws create strife at work place

This discussion was moderated by Mr. Sharad Gangal – EVP, Thermax Ltd, and the participants were:

∙Mr. AL Somayaji - Sr. Advocate and former Advocate General of Tamil Nadu

∙Mr. TK Rangarajan - Member of Parliament and Central Committee Member, CPI (M)

∙Mr. K PandiaRajan - Member of Legislative Assembly and Founder, Ma Foi Strategic Consultants

∙Mr. Prabhat C Chaturvedi - IAS (Retired) and Former Chief Labour Secretary, India

Justice Ferdino I Rebello, Senior Advocate, Former Chief Justice, High Court of Judicature at Allahabad and Former Judge, High Court of Bombay synthesised the outcome of the session.

Labour laws are the governing principles of industrial relations. These laws have been created, mostly since independence, keeping in view the well being of the key stakeholders in industrial relations. However, since the past

few years, key stakeholders and experts have debated on the relevance of the laws in the present day context and whether they enable progress if at all.


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There is a need to provide greater flexibility to employers so that they may manage their businesses more efficiently. Laws pertaining to retrenchments, layoffs and closure require employers to seek prior permission from government authorities. Due to these interventions and the lack of flexibility, employers are restricted from managing their businesses efficiently. For instance, adopting

technological automation to help reduce cost is a challenge to an employer, if it may lead to reduction in manpower. Such restrictions in turn necessitate management to look for alternates (such as employ contract labour), and thus become strong reasons for conflict between the employers and employees.

1. Labour laws need to enable efficient management:

Over the years, the nation has witnessed many instances of employees working in critical industries (such as Hospitals, Education Institutions) coercing their employers into submitting to their demands. While such coercion leads to loss of money, business and even human lives, the methods employed by the workers are deemed legally

correct, as per the labour laws. These instances illustrate the archaic nature of the laws and the need to create necessary exclusions, so that no party is left to the mercy of the other. Some of the laws needing immediate review are the Mathadi Act, Industrial Disputes Act and the Factories Act.

Today 44 labour laws are defined at the central government level, and many more at the state level. The term 'Worker' is defined in 13 different ways, and while 'Wage'has10 different definitions. These redundancies and duplication are the primary reason for the conflicting interpretations and ambiguous applications. While the government has seen

some spurts of effort in consolidation, there is a lack of will in seeing it through. Additionally, there is a strong view that the laws be defined at the state level only. This will allow some of the progressive states to create laws which are more conducive for performing business.

2. Some labour laws lack relevance and need review:

3. Labour laws need to be consolidated:

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The view that labour laws are archaic is incorrect; rather in the context of the nation, they are quite up to date, as most laws have been created after independence, and have had revisions. Organizations

demanding flexibility of labour laws, seek it for the right to hire and fire at will. Providing such flexibility will absolve employers of their responsibilities towards the working class, and cause significant social upheaval.

4. Labour laws protect workers from exploitation:

It is not justified in blaming labour laws as the source of conflict at workplaces. While it may be true that some labour laws need review, and additional flexibility will assist the employers, the true reason for conflict lies in the actions and attitudes of the stakeholders -than to arrive at an understanding, stakeholders tend

to take opposing positions basis the laws and conflict arises due to their relentlessness. The labour laws are mere enablers and any law can be interpreted in different ways. Thus stakeholders should not await creation of utopian laws, and should instead focus on managing effectively in the existing framework.

5. Labour laws do not create Strife:

LABOUR LAWS NEED TO BE REVISED LABOUR LAWS ARE NOT CAUSING STRIFE

Need to enable more efficient management

Lack of relevance in different scenarios

Need for consolidation and empowerment

Protect workers from exploitation

All Laws are subject to interpretation

Critical Factors:


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Key Takeaways:

Shifting the focal point of labour laws completely to the states, may lead to creation of laws best suited to the local conditions, and a swifter review process. States seeking greater investment from industries will have the flexibility to define laws more conducive for business, and those preferring greater protection of its labour workforce, can define them accordingly.

Laws have their desired impact when they are enforced effectively. Likewise, for the labour laws to serve their intended purpose, it is necessary that they be enforced through the judiciary and other mechanisms effectively, with compelling incentives for adherents and prohibitive penalties for violators.

Employers, workers and trade unions need to collaborate within the framework provided by the government, and not take advantage of any possible loop holes in the law. Due to the complex nature of governance in India, reviews and revisions take longer, and it is in the best interest of all stakeholders, that the laws be used for protection and not exploitation

Swifter and Effective Judiciary

Reasonable Interpretation of the laws

Laws will be deemed archaic if they are not up to date with the present day requirements. They will be regarded as inflexible, if they do not acknowledge and balance the needs of all the stakeholders. If India is to remain in the global limelight of growth, a constant review of the labour laws (at least of their relevance) should be enabled through effective governance and judiciary

To ensure that labour laws do not cause or promote strife at work place, the following can be considered:

Greater empowerment at the State level

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d) Debate Theme 3: Bad practices of management or opportunistic practices of union leaders – Who is more responsible for criminalization of trade unions?

This discussion was moderated by Mr. SK Dutt – President and Head of Group HR, ABG Group, and the participants were:

Mr. MK Sharma - Former Vice Chairman, Hindustan Unilever

Dr. Vivek Monteiro- Trade Union Leader and Secretary, Centre of Indian Trade Unions

Mr. MN Singh - Former Police Commissioner, Mumbai

Ms. Anannya Bhattarcharjee - President, Garment and Allied Workers Union and International Coordinator, Asia Floor Wage Alliance

Mr. Siddharth Varadarajan - Editor, The Hindu, synthesized the outcome of the session”

Criminal activities in the work place, which are usually consequent of conflict in the organization, include illegitimate strikes by workers, vandalism in the form of damage to property, and physical attacks on individuals. The past few years have seen a rise in the number of

minor and major criminal activities by trade unions at the work place, few of which have even led to loss of life. These increasing incidents demand that we identify their source/es and take the necessary steps to prevent them.


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The trade union movement in India had developed along with the political movement in the pre-independence era. However, despite the changing times and needs since independence, the two entities – trade unions and politics – remain deeply intertwined. The needs of the workers need not be the same as the needs of the political parties

supporting the unions. Hence, it is unclear whether criminal activities of trade unions are a form of the workers' agitation, or an attempt to meet larger political goals. There is an urgent need to decouple the two entities, through the means of laws and policies, and the prudent choices of workers and employers.

1. Political nature of unions lead to a conflict of interest:

While the debate primarily concerns organizations with regular workforce and having a trade union, it is also essential to focus on the unorganized sector, where trade unions don't exist. This unregulated sector has been witness to numerous criminal incidents initiated both by management and independent local entities which govern the unorganized sector. In the case of contract labour, managements are known to have resorted to extortion and other forms of criminal activities to prevent

formation of unions and their related activities. It cannot be denied that organizations benefit by employing contract labour. However, to take undue advantage of the same is deemed criminal. Such practices by management can provoke even the unorganized workers to take the law in their own hands, thus escalating the matter further. Thus, there is an immediate need to create robust laws pertaining to the unorganized sector, and provide a cure to the criminalization.

2. Management are responsible for criminalization in the unorganized sector:

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MANAGEMENT IS MORE RESPONSIBLE UNION LEADERS ARE MORE RESPONSIBLE

Criminalization in the unorganized sector

Need for better judicial intervention

Political nature of unions

Critical Factors:


Fear of penalty and retribution as enabled by the law, the judiciary and the police, can be a strong deterrent to criminal activities. Consequently, an absence of the same becomes an encouragement to criminal activities, even at the workplace. While an improvement in the speed at which justice is delivered is an important factor, other measures can be taken to check criminal behaviour by trade unions. Firstly, the decoupling of

trade unions and politics will prevent the intervention of political interests in the judicial process. Secondly, strong precedence has to be set by the judiciary in the handling of workplace criminalization. Such precedents can instil the necessary respect which workplace stakeholders need to demonstrate towards the law.

3. There is a need for better judicial intervention:

Key Takeaways:

Violent acts at the workplace are either a form of action by the workers, or reaction against practices by the management. In either form, criminalization does not benefit any of the stakeholders in the long run. To ensure that criminal activities are eradicated from the workplace, the stakeholders need to:

Responsibility of the criminalization of the trade unions rests on the shoulders of the management, the union leaders (whether internal or external) and the workers too. Employers need to be proactive in identifying the potential causes of unrest among the workers, and create a grievance re-dressal mechanism within the organization. Workers need to discern the purpose (whether political or their leaders') they serve by taking the law in their own hands, and decide on the union functioning and leadership accordingly.

Take collective ownership and be discerning

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To arrive at a solution for conflicts at the workplace, it is important to understand the actions and attitudes of various stake holders, and the interactions between them. To do so, their roles should be understood in detail, and the current situation should be compared against the desired state. This can be achieved by analyzing the stakeholders basis the following factors:

ANALYSIS OF THE ROLES OF THE STAKEHOLDERS


WORKERSTRADE UNION

ORGANIZATIONGOVERNMENT

FRAMEWORK EXECUTION

INTENT

Fig 8 – Tool to analyse the roles of the stakeholders

Intent - The strategic point of view of the stakeholder and the basis of all its decisions

Framework - The channels and systems through which ones take holder interacts or engages with the other

Execution - The actual interactions, behaviours and actions occurring between the stakeholders, including the tactical approach adopted by each

For a stakeholder, each of these factors should be robust, and logically interconnected to each other. Each factor must communicate and exchange feedback with the other. For instance, if the intent of an organization is to treat its workers with respect, then it must execute it by deploying better front line managers, and engaging the managers well.

Through this analysis, the challenges faced by each stakeholder and the shortcomings have been identified, and recommendations provided to enable more productive workplace relations.

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1. Organization culture:

An organization's approach to managing people, including workers, is demonstrated through its explicitly stated and implicitly practiced culture. It is this culture which drives the frameworks for managing workers and the actual execution at a transactional level.

The culture desired for a smoothly functioning workplace is based on trust, respect and equity in the organization. This requires organizations to actively involve workers in decision making, maintain transparency through frequent and two-way communication, create policies catering to the exact needs of the workers and create a framework for sharing their concerns and feedback.

However, the culture in many organizations, with respect to

worker relations, is combative, instead of collaborative. The general approach of management is reactive and hence focused on conflict management, instead of being proactive and focusing on prevention of conflicts. As culture is top driven, the sense of mistrust is cascaded from the top management to every individual who deals with the workers. Hence, both strategically and tactically, management fails to identify workers as key stakeholders in the well-being of the organization, and instead views them as a necessary evil, which impedes progress.

Thus, we notice that in many organizations there is a gap between the desired and the practiced Intent. Organizations must realize that management must drive the right culture.

a) Intent

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2. Role of trade union leaders:

The trade union plays an important role in providing representation to the workers in an organization. This in turn also assists the management to address the workers through a common channel, and be able to manage the workers in a democratic manner. Thus, while the primary functions of the union are to secure fair wages and improve the working conditions for the workers, in today's context, the desired intent of a trade union is to arrive at a win-win situation between the management and the workers. The leaders of the trade unions are in the unique position of being 'Participant Moderators' and play the role of both a worker, as well as a moderator between the management and the workforce. Hence, while the union leaders are workers themselves, they are in a position to understand the needs of the organization and the challenges faced by the workers. Their desired intent should be to ensure the well being of the

primary stakeholders in industrial relations.

However, the history of trade unions reveals that such a balance has not been successfully aimed at. Trade unions have very often been viewed as being either pro-worker, or occasionally as pro-management. This has caused mistrust in the worker-employer relationship, becoming one of the main reasons for conflict. Unfortunately, some trade union leaders have viewed this conflict as being beneficial to themselves. Such leaders are known to harbour aspirations which do not align with both the workers' and the organizations' interests. The workers, who elect such leaders, need to be cognizant of their roles in the impending conflict. While the primary intent of the workers is to work as prescribed, and provide for their families, their roles in identifying the right leadership is significant. Lack of their proactive participation has led to opportunistic behaviour by union leaders.

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Thus, there exists a gap between the desired and demonstrated intent of trade unions and workers. It is essential that organizations and the government educate and enable union leaders and workers to align their intent for the well being of all.

Summary:

FACTOR RECOMMENDATIONS STAKEHOLDERS

INTENT

Organizations to promote the right culture

Trade union leaders to act as moderators

Organization

Trade Union, Workers

1. Labour laws: Labour Laws in India were created with a view to protect the interests of labour in organizations. Since the past few years, the laws are transitioning from being completely pro-worker, to addressing the organization's needs too. However, laws which protect the workers can sometimes empower them to an extent that they take

undue advantage of the laws. An example of this is the Mathadi Act, where organizations are compelled to hire through Mathadi unions and boards for manual labour work. While this law ensures employment, and benefits the Mathadi workers, organizations are compelled to spend more and are prevented from achieving better efficiencies.

b) Framework

Fig 9 – Recommendations on pursuing the desired Intent for the Stakeholders

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There is a strong need for the Government to review the India labour laws such that they promote parity between the management and workers. However, employers and employees need to be cognizant of the fact that laws are meant to be enablers of justice. Hence, it is imperative that they be interpreted in a balanced manner, such that no one stake holder is put at a disadvantage. Thus, the appropriate interpretation of the drafted labour laws will be a key foundation for a collaborative relationship between the employers and workers.

2. Workers' wages:

In industries, workers' wages are managed through wage settlement or long term settlement. This settlement identifies the basic salary, allowances and other pay components for different grades for a long duration, such as 10 years, including the annual increments for the duration. However, over the years, sharp contrasts have been drawn between the salaries of the workers, and the top management executives. In organizations, the salary of a top executive may be more than 800 times that of an average worker. Additionally, senior management salaries are known to increase by 30-40% annually, whereas those of workers go up by a rate less

than that of the inflation.This disparity has increased with liberalization, and today, has become one of the most significant reasons for conflicts at the workplace. Managements need to remunerate their workers adequately, and demonstrate financial prudence by example.

3. Workers' benefits:

Apart from remuneration, organizations provide benefits to their workers. The benefits are in the form of facilities at the workplace and welfare activities for the workers and their families. Some organizations are aware of the growing needs of the employees, and have instituted plans such as scholarships for the workers' children, alternate employment for women, etc. However, even today, facilities which enable basic hygiene is absent in many organizations. Employers, especially among SMEs, are known to cut corners in Canteen, Washroom and other basic facilities for workers. This makes the divide between the workers and the management more conspicuous, and compels workers to resort to conflict with the management. Benefits play an important role in equitable treatment of employees. Organizations should not discriminate in such a manner which denies workers of their dignity and basic rights.

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4. Contract labour:

The Contract Labour Act allows organizations to employ contract labour for peripheral activities at the workplace. However, employment of contract labour for perennial activities has been one of the foremost points of conflict between the management and regular workforce. Ambiguity in definition of perennial activities is one of the sources of this conflict. Some organizations claim the need for this practice due to the seasonal and even erratic nature of business, which necessitates flexibility to reduce or ramp up fixed costs. However, in some organizations, contract-labour is utilized to supress the regular workforce and reduce the influence of union. Employing contract labour in this manner further intensifies conflict at the workplace.

The conflict can be partly resolved by clearly identifying perennial activities in the organization, and allocating the workforce accordingly. While this is a decision driven mainly by economics, basic principles of fairness and 'equal pay for equal

work' need to be adhered to. Additionally, organizations need to keep in reckoning the fact that the cost arbitrage they enjoy through contract labour may diminish in the long run, as reforms to the Contract Labour Act are being called for, which may even result in adding a premium to the flexibility offered.

5. Union charter:

Union charter is created by the trade union in an organization and is a comprehensive set of guidelines applicable to all the workers of the union. It details the mission and vision of the union, as well as the specifics related to the interactions between the employer and the workers. It is essential that the union charter be drafted such that it addresses the needs of the workers. For instance, charters should clearly define guidelines which do not grant undue benefits to union leaders. The charter should empower the leaders to represent the constituent workers effectively, and at the same time not suppress the democratic nature of the union.

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FRAMEWORK

1. Front line managers:

The intent of the organization is translated into action primarily through the day to day interaction between the front line managers and the workers. Typically, line managers are responsible for getting the work done through the workers, and IR managers communicate with the workers regarding policies and related matters. Thus, front line managers act as the bearers of information, and often find themselves caught

in between the management decisions and the workers' reactions. In almost all cases of conflict and violence, the front line managers are significantly impacted; the long list of workplace casualties is a testimony to this fact. Additionally, organizations are unable to attract the best talent for such roles, due to the inherent risks and disincentives involved.

c) Execution

Labour Laws be up to date, and treated as guidelines

Workers' Wages be fair

All Stakeholders

Organization

Workers' Benefits to provide basic needs and dignity

Contract Labour to be employed rationally

Organization

Organization

Union Charter to enable democratic practices

among workers

Trade Union, Workers

Fig 10 – Recommendations on building the desired Framework for the Stakeholders

Summary:

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Organizations need to empower the front line managers to take better decisions, and also add a premium to these positions, if they are to get the best talent and effective management through these touch points.

2. Two way communication: One of the strongest means of demonstrating trust and inclusivity is by maintaining transparent, frequent formal and informal communication with the workers. Organizations with unions usually maintain formal communication with workers through unions. Smaller organizations are typically more effective at informal communication, owing to their limited scale, which may not be possible through unions in larger organizations. However, through other touch points such as line managers and IR managers, management in larger organizations can communicate with workers more often and seek their inputs, both formally and informally.

It is also essential that the union leaders set up a strong internal communication mechanism (either verbal or written) within the unions, and ensure that the entire workforce is reached out to. It is also essential that the union

leaders promote feedback from the workers and allow healthy debate on all matters. This ensures that the union is viewed as being democratic and presents a unified front to the management.

3. Skill development:

Skilling of worker is an extremely important factor at the workplace. As availability of skilled talent in the market is a significant challenge for the organizations, they need to train the worker by themselves. However, it is also essential to up-skill the workforce, which will help the organization in improving both product and process quality. However, the fear of high demands by skilled workmen and losing such workmen to competition has made some organizations wary of investing in up-skilling the workforce.

Organizations need to collaborate with workers and unions to create an ecosystem in which constant up-skilling of the work force is possible. This will help organizations be more competitive in the market and also help demonstrate their concern for the betterment of their workforce.

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4. Labour officials:

The Ministry of Labour and Employment has identified various roles across different levels, to liaison between the government, and the organizations and their workers. The officers act as representatives of the ministry, and primarily interact with organizations and trade unions. However, these officers are not empowered sufficiently, and act mainly as bearers of information,

and not those who can take active decisions. This fundamentally delays the decision making process in critical matters, and does not provide the necessary remedy in time.

Hence, the government has the basic framework in place to play its role well through these officers. It only needs to empower them sufficiently so that they may help hasten decision making and critical action.


EXECUTIONEXECUTION

Front Line Manager roles be made more premium

Two Way Communication channels for greater

inclusivity

Organization

Organization, Trade Union,

Workers

Organizations to help workers be better skilled

Labour Officials be empowered for quick

decision making

Organization

Government

Fig 11 – Recommendations on acting on the desired Execution for the Stakeholders

Summary:

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Conclusion

The immediate task at hand is to actively participate in the organization's success. The years since liberalization have seen organizations trying to extract greater value from their resources, of which the workforce is as integral part. Due to the protective nature of the labour laws and rigidities of trade unions, organizations have relied more and more on contract workforce, thus reducing the powers of trade unions and by extension the regular work. To remain relevant, trade unions have to actively moderate the relationships between management and workers. Their intent needs to align with those of the workers and the larger organization, and their approach and practices should be in line with this refreshed intent.

Government must align its labour policies with the larger national objectives. If the desired growth rates are to be sustained, then efficient framework through labour laws, greater efficiency through labour officials, and better control through the judiciary should be achieved.

Organizations need to fundamentally be cognizant of the changing outlook of the workers. With the social disparity reducing gradually, the industrial disparity should bridge at a faster pace. Managements need to drive the right culture throughout the organization, lead the demonstration of care and concern from the front.

3. Government

1. Organization

Through the analysis, it is evident that steps are necessary from all the stakeholders to achieve the desired industrial relations, without any conflict in the workplace.

2. Workers and Trade Unions


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India has evolved significantly in the past two decades. While, many industries have emerged and progressed well, almost all sections of society today are better connected and informed, than before. The social divide between the employers and employees, though not insignificant, has been bridged since liberalization. Today, many workers successfully aspire to provide their children with quality education, and an opportunity to be equal with the children of white-collared employees and even their employers. This presents a strong illustration to the changing social and industrial construct in India.

Trade unions were formed to empower workers, who may otherwise not have been informed and influential enough to safeguard their rights from possible exploitation from their employers. Trade unions had significant social relevance, as the workers represented a social strata and their well being impacted that of the society. As a result, clearly defined boundaries were created to achieve objectivity, which allowed better tracking of effort involved, quality of the effort and the compensation and benefits in return of the effort.

However, this also resulted in a lack of agreement and incentive,

for both employers and workers, to provide over and above the specified limit (of effort by workers, and benefits and opportunities by employers), when necessary. In contrast, while the relationship between employers and white-collared employees (non-workers) is also governed by contract, it offers greater flexibility and opportunity to both the stakeholders.

In the long run, it is essential that industrial relations reconcile industrial growth and the evolving aspirations of the workforce. Our analysis has revealed shortcomings in the intent, framework and execution of all the stakeholders, and we have recommended steps each stakeholder can take to achieve the desired outcome. However, these steps are short term, and with the intent of minimizing conflict at the work place. To achieve overall industrial and social development, changes to the fundamentals of industrial relations are necessary. This leads us to the conclusion that eventually, distinction between white collared and blue collared employees needs to be eliminated and uniform systems should be applicable for all the employees in an organization.

THE WAY AHEAD


White Collared Employees:

Fig 12 – Factors of Engagement of White Collared Employees with Management

Factors of engagement -

The disparity between the white and blue collared employees can be analysed by understanding their factors of engagement with the organization.

THE WAY AHEAD


Rewards (fixed and variable)

Learning and

Development

Career Management

Performance driven

Incentives

Employee Value

Proposition

FOUNDATION OF ENGAGEMENT - PERFORMANCE

It is evident that the basis of engagement between white collared employees and an organization is performance of the employee and competitiveness of the organization. Employee has to perform well to enjoy the desired benefits. Likewise, an organization has to be competitive and attractive, to retain its employees. As a result, there exists a better possibility of trust and a healthy give and take relationship between the employees and the employer, which helps employees meet their aspirations and organizations grow as desired.

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THE WAY AHEAD


Blue Collared Employees:

Fig 13 – Factors of Engagement of Blue Collared Employees with Management

Long Term Settlement

Right to Unionize

Employment Contract

Dispute Resolution

Protection under

Labour Laws

FOUNDATION OF ENGAGEMENT – PROTECTION

The basis of engagement between blue collared employees and an organization is protection and certainty, of employment and wages for workers and productivity and expenses for organizations. To achieve this, measures are taken to achieve objectivity. However, with this objectivity, workers can only partially meet their growing aspirations, and organizations are restricted from extracting more value from their workforce.

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Bridging the Gap:

To ensure that both workers and employers achieve their desired objective, the foundation of engagement of the workers should transition from protection to performance.

THE WAY AHEAD


PROTECTION PERFORMANCE

The following considerations can be made by employers and workers to ensure greater productivity, and greater benefits and achieve a win-win situation.

Workers Employers

Workers can achieve better compensation basis

performance, if they agree to salaries and

variable compensation (as a proportion of total

compensation), instead of Long Term

Settlements

Employers should include workers in decision

making and even in team building exercises

with the rest of the organization, and ensure

that everyone identified them as equals

Workers should stretch when necessary, and

assist the organization in achieving its goals,

which in turn will be beneficial to the workers

Employers can ensure better productivity by

up-skilling and investing in their workers. They

can also enable workers in taking up larger

roles, basis their skill and competence.

During recessionary times or to bring in

financial stability, workers should agree to

employers regularizing their workforce

Management should implement common dress

codes, dining places and other key facilities for

all its employees, so that the divide is bridged

both in letter and spirit

Fig 14 – Steps to be taken by Workers and Employers to transition the Foundation of Engagement

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Achieving this also requires a cultural change in the eco-system. For instance, business schools today have adapted themselves to teach young managers to bargain and deal with workers. Such an approach conditions them to view and treat workers distinctly and not at parity with white collared employees.

Our recommendation is to engage the blue collared workforce in a manner similar, not necessarily identical, to how the white collared employees are engaged.

In other words, the purpose and function of industrial relations and human relations should be aligned and not divergent.

This equity should be the objective of all organizations employing workers, as workers will continue to be better connected, mobile and more aspirational and soon be no distinct than the white collared employee.

THE WAY AHEAD


The Indian growth story has encountered many roadblocks in the recent past. Many of the impediments are social and political in nature, and require a larger participation from all sections of society. In such times, it is essential that the industrial wheel of the nation runs uninterrupted, raises the competitiveness of the nation, and also alleviates it of its other malaises.

Conflicts at workplace are highly condemnable and avoidable, and their elimination is necessary for overall industrial progress. Steps

are to be taken by all the stakeholders to ensure that all concerns should be addressed amicably, and not through the means of conflict or causing harm to the other. The recent incidents of conflicts and even deaths demand us to pause and reflect on our roles in the larger scheme of industrial health.

As a potential next step, a roundtable can be convened comprising industry bodies, trade unions and the government to discuss and deliberate on the key emergent issues.

CONCLUSION


Simplification and rationalization of labour laws and establishing common definitions for wages,

workmen, employer, employee, establishment, appropriate governance etc. along with

rationalization of inspections, maintenance of returns, records and notices under various

Consolidation of the laws under the key themes of Industrial Relations, Wages, Social Security,

Welfare and Working conditions

Establishing consensus on 5-7 key amendments in the extant labour laws for providing enhanced

flexibility to management while protecting the rights of employees. This could be carried out in

phase I followed by the next 5-7 amendments in phase II.

To examine setting up a non-governmental, impartial watchdog that could act as an effective

deterrent against strife and criminality at the workplace. The body will not adjudicate any dispute

or nor would it direct the parties in any way on the dispute resolution. Its prime objective would

be to mobilize the state to do limited intervention in terms of putting the potential perpetrators

or instigators on notice or mobilizing the law enforcement agencies for preventing outbreak of

strife at the workplace.

Fig 15 – Agenda for the Round Table between the key stakeholders

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CONCLUSION


The immediate steps to be taken by each of the stakeholders are:

Organizations to mete out respectable treatment to their workers, and ensure meeting of all the hygiene factors

Organization

Workers to not misuse the labour laws meant to protect them, and trade union leaders to act as moderators between the employer and workers

Workers

Government

Government to create strong deterrents for mala fide acts by either stakeholder, and review labour and other related laws to promote fair treatment

Fig 16 – Immediate next steps for the Stakeholders

Eliminating distinction basis the colour of the collar should be the larger and long term objective of all organizations and workers, and the government and other stakeholders should create an eco-system to enable the same.

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Mr. K V Kamath Past President, CII and Chairman, ICICI Bank and Chairman, Infosys

Justice B N Srikrishna Indian Jurist and Retired Judge, Supreme Court of India

Mr. Pradeep Bhargava Chairman, CII Western Region and Director, Cummins Generator Technologies India Ltd

Mr. K Ramkumar Chairman, CII WR 5th HR & IR Summit and Executive Director, ICICI Bank

Mr. K B S Anand Managing Director & Chief Executive Officer, Asian Paints Ltd

Mr. Kiran Karnik Indian Administrator and Former President, NASSCOM

Mr. Paranjoy Guha Thakurta Editor and Commentator, The Asian Age

Dr. Prasenjit Bose Leftist Economist

Mr. Shekhar Gupta Editor-in-Chief, The Indian Express

Mr. A L Somayaji Senior Advocate and Former Advocate General of Tamil Nadu

Mr. T K Rangarajan Member of Parliament and Central Committee Member, CPI (M)

Mr. K Pandia Rajan Member of Legislative Assembly and Founder, Ma Foi Strategic Consultants

Mr. Prabhat C Chaturvedi IAS (Rtd) and Ex-Secretary, Ministry of Labour and Employment, Government of India

Justice Ferdino I. Rebello Senior Advocate, Former Chief Justice, High Court of Judicature at Allahabad and Former Judge, High Court of Bombay

Ms. Anannya Bhattacharjee President, Garment and Allied Workers Union and International Coordinator, Asia Floor Wage Alliance

Dr. Vivek Monteiro Trade Union Leader and Secretary, Centre of Indian Trade Unions

Mr. M N Singh Former Police Commissioner, Mumbai

Mr. M K Sharma Former Vice Chairman, Hindustan Unilever

Mr. Siddharth Varadarajan Editor, The Hindu

Mr. Balkrishna Pattil Chairman, CII WR industrial Relations Sub-Committee 2012-13 and Vice President – Employee Relations, Mahindra & Mahindra Ltd

ANNEXURES


Annexure 1 – Speakers at the Summit:

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ANNEXURES


Annexure 2 – The 5th IR & HR Summit 2012 Partners

HR Magazine Partner

Webcast Partner

Knowledge Partner

Associate Partner

Digital Media Partner

Platinum Partner

In Association With

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About Aon Hewitt

Aon Hewitt is the global leader in human capital consulting and outsourcing solutions. It is also the pioneer in HR consulting in India. The company partners with organizations to solve their most complex benefits, talent and related financial challenges, and improve business performance. Aon Hewitt designs, implements, communicates and administers a wide range of human capital, retirement, investment management, healthcare, compensation and talent management strategies. With more than 29,000 professionals in 90 countries, Aon Hewitt makes the world a better place to work for clients and their employees. For more information on Aon Hewitt, please visit www.aonhewitt.com.

About CII

The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the growth of industry in India, partnering industry and government alike through advisory and consultative processes.

CII is a non-government, not-for-profit, industry led and industry managed organisation, playing a proactive role in India's development process. Founded over 117 years ago, it is India's premier business association, with

a direct membership of over 7100 organisations from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 90,000 companies from around 250 national and regional sectoral associations.

CII catalyses change by working closely with government on policy issues, enhancing efficiency, competitiveness and expanding business opportunities for industry through a range of specialised services and global linkages. It also provides a platform for sectoral consensus building and networking. Major emphasis is laid on projecting a positive image of business, assisting industry to identify and execute corporate citizenship programmes. Partnerships with over 120 NGOs across the country carry forward CII's initiatives in integrated and inclusive development, which include health, education, livelihood, diversity management, skill development and water, to name a few.

With 63 offices including 10 Centres of Excellence in India, and 7 overseas offices in Australia, China, France, Singapore, South Africa, UK, and USA, as well as institutional partnerships with 223 counterpart organisations in 90 countries, CII serves as a reference point for Indian industry and the international business community.

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About the authors

Ajay Soni is the APAC Head of the Leadership Consulting practice of Aon Hewitt.

Ryan Lowe is the Director of the Performance and Talent practice of Aon Hewitt.

Anand Radhakrishnan is a Consultant with the Performance and Talent practice of Aon Hewitt.

For further details, please contact:

Ajay SoniAon Hewitt [email protected]

+91 22 403451735

Ryan LoweAon Hewitt [email protected]

+91 22 40345172

Anand RadhakrishnanAon Hewitt [email protected]

+91 22 40345120

Charu MathurRegional Director, CII Western [email protected]

+91 22 24931790 Ext. 401

Sangita Das Deputy Director, CII Western [email protected]

+91 22 24931790 Ext. 409

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Documents

ABOUT disputes on the rise, the need for amicable industrial relations has achieved critical importance. Industrial relations deals with the relationship between workers of an organization