Term 2 mid sem HRM

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1-2. Nature ofIndustrial Relations:

Traditional & ChangingPerspectives

Debi S. SainiProfessor & Chairperson—HRM Area

Management Development Institute, Gurgaon

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The issues discussed in this presentation are:

1. Conflict dynamics & different approaches of IR Mgt.

2. Working of an IR system: Dunlop’s System Model

3. IR & related terms: IR—LR—ER

4. Has Globalizations changed IR scene? How?

5. IR: Actors—Issues—Institutions—Procedures

6. Traditional issues in IR

7. Frames of reference of IR: Unitarist––Pluralist––Marxist

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Two Main Components of this Course:

Management of Personnel/People(Systems, effectiveness, engagement, productivity)

Management of Industrial Relations (Conflict, interests, rights, peace)

Lately, the two perspectives are gettingmerged into an integrated HRM framework

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The Roots ofIndustrial Conflict

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Peace Requires: Balancing of Business Needs & People Needs

• High Earnings

• Speed to Marketplace

• Market Share

• Product Quality

• Customer Service

• Customer Responsiveness

• Low Costs

• Efficiency/Productivity

• Flexibility

• Benchmarking

• Responsive/Innovative

• Future Oriented

• Customer Satisfaction

• Reward & gain sharing

• Reasonable job security

• Work-life balance

• Flexibility

• Empowerment

• Welfare facilities

• Social security

• Learning Atmosphere

• Respect for their Diversity

• Growth opportunities

• Recognition/ belonging

• Participation/ Involvement

• Management style

People Needs are Managed differently in

Different Orgs.

IBMTata Steel

Ballarpur IndustriesHero MotoCorp

NDPL

Business Needs People Needs

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First know: Why Labour-Mgt. Conflict Occurs

Conflict is at the centre in organizational working

Why:

Industrial Conflict: a Complex & difficult issue

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Difference in interests, values, goals, attitudes

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Mgts. differently handle conflict:

Positive or Negative Meaning of Work

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• Work is interesting

• Reflects good quality of life

• Gives us meaning of life(WM feels: meditating/ bldg. a temple)

What does work mean to People: Two extremesPositive (win-win) Negative (lose–lose)

Sheer Drudgery/unpleasant

A way to kill time

Just a means to living

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Can we think ofsome basic approaches to

managing employer-employee relations?

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• Graziano: CEO killed • Maruti-Suzuki HR Chief burnt

• HMSI Violence 2005• Tata Steel (35 K workers; no strike since 1958)

• Classic Stripes: 3-6 best employer co.

How do we go about understanding these issues?

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500 WM including contract WM—Most are blue-collared

4 WM 25 yrs. ago (in 10’ x 10’): Built 44 acre campus in Vasai3 plants now: Mumbai; Vasai; Hardwar— No Union

Kishore Musale Charitable Trust:

Main motto: “dignity at work.”—Believes in: “valuing every individual, giving people their due,

freedom, respect, opportunity backed by lots of training.”

Classic Stripes (Mfg.): Come Out of Control Mindsethttp://classicstripes.com/manufacturing_plants.html

Won Safety & Environt. 2003 award (SIGA given to 5 cos. worldwide)

— Kaizen Training: 2½ hrs per month

A relationship committee: Meets twice in a month

Has a library with trade journals, magazines & books

DM: 1/3 Women workers; also physically-challenged

Shares with employees a %age of its annual profits

Classic Stripes: Some HR Initiatives contd…

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Tata Steel Ltd.: HRM Model

• Sr. Mgt. work at less than 60% of market worth; don’t leave

• Meets need for dignity, stability, security: No strike since 1958

• Participation, paternalism (kin employment), family focus

• Ethical working

• CSR creates a sense of pride in employees

Comparing two US Cos.: South West Comparing two US Cos.: South West && American AirlinesAmerican Airlines

• On same day (May 2010): AG meeting of airlines: SWA & AA

--AA meeting was picketed by AA Pilots Assn.--Southwest celebrated 37 yrs. of service by founder, Herb Kellehar

• Paper carried picketing news; same paper carried an ad: “Kellehar knew, knows & will always know that

the secret to bus. success, small or large, is to put people first.”

• Kellehar sees “employees as my principal customer.”

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UnderstandingEmployee Relations& related Terms?

Employees as Individual (Market operates here)

Employees as collective(Class solidarity operates here i.e. Unions)

Org. needs: Employee retention & engagement, indl. peace in both situations

2 Sets of Concerns for Employer & Employee

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ER & IR both deal with all aspects of employment relationsi.e. unionized & non-unionized [Today, Global focus: cooperation—decent work]

—But IR’s key focus is unionized workers, & —ER’s key focus is individualized workers

ER: is ongoing relations-building process with employees

through HR practices & orgl. culture-bldg. efforts

for securing employee commitment/engagement

• LR (labour Relations) focuses exclusively onemployment relations in a unionized environment (i.e. Unions & mgt.)

Employee Relations, IR & LR

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What does good ER Involve: Research?

1. Dialogue & communication for trust & culture

2. Partnership through involvement & feeling valued

3. Proactive, not reactive efforts (Hero MotoCorp)

4. Employee rights, fairness, just grievance mgt.

5. Employee discipline (Tata Steel; Classic Stripes)

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Employee Relations

Employee Communication

for Trust bldg.

Partnership& Employee Involvement

Employee Rights/fairness/Grievance mgt.

EmployeeDiscipline

Fig.: Key Dimensions of Employee Relations

ProactiveEfforts

Manifestations of Poor Employee Relations

Unionization

Poor Performance

Employee Absenteeism

Employee dissatisfaction & Turnover

Litigation

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What do youthink is meant by

Industrial Relations?

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Industrial Relations: Simply Speaking:

Industrial relations (IR)

is the process of rule making

that mediates between divergent interests

of capital and labour

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How can we view Industrial Relations

J. H. Richardson (Leeds University)

• “Industrial relations is

the art of living together

for purposes of production”

ImportantSome

regulation is needed

inall relations;

State determines

the regulatory framework

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How can we view Industrial Relations contd…

Hugh Clegg (Clegg & Flanders pioneers of Classical Oxford School of IR)

“Industrial relations is a study of

workers and their unions,

employers and their associations,

and State & its institutions/agencies

concerned with regulation of employment.”

Imp.: Different powers, roles, interests, duties of Actors

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Is Globalization Syndromelinked to

Industrial Relations: How?

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What Does Globalization mean?

• Global movement of capital

• Global movement of businesses

• Driven by principles of free market economy

• & less obstructed people movement

• Across borders within companies

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Globalization & Other Causes of Changes in Business1. GLOBALIZATION Syndrome

2. Information Revolution/Internet

3. New Technology

4. Emergence of Service Industry

5. HR Philosophy:

M. Thatcher has been named UK’s most effective prime minister of the 20th centuryby BBC History Magazine 30 Aug, 2006, TOI

Globalization has led to:• Internl integration of economies• PSU reforms & privatization• Collaborations & jt. ventures• Dominance of market

rationality• Decline of welfare state

Psychological Contract &Focus on: Employee Relations

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What is meant by:•IR Actors

•IR Institutions•IR Procedures

•IR Issues

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Focus of the Discipline of IRA. Characters (or actors) in IR

––Union leaders

––HR Managers

––Conciliation Officers/ Mediators

—Arbitrators/judges

––Labour Courts/

––Labour Lawyers/Management Consultants

––Others

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Focus of the Discipline of IRB. IR Institutions

(permanent form of custom or law)

––Unions––Employer associations ––State/Labour Bureaucracy

––ILC––ILO––Tribunal/Labour Court ––Labour law––Higher judiciary

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Focus of the Discipline of IR cond…

C. IR procedures (aim at: Procedural justice)

––Bargaining/Negotiation

––Conciliation —Arbitration—Adjudication––Reference––Procedure for going on strikes/ lockouts––Inquiries/Disciplinary procedure

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IR is studied by many academic disciplines• Economics

• History

• Law

• Sociology

• Political Science

• Management

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What do you thinkare some of the key issues

in IR?

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Traditional Problems/Issues in IR

1. Job satisfaction: Job design––Working conditions––supervision

2. Negotiating Wage/salary/VRS/bonus/benefits

3. Alienation & discontent

4. Grievance management

5. Trade union, strikes, lockouts

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Traditional Problems in IR6. Industrial dispute settlement

7. Indiscipline, absenteeism & mobility

8. Labour Laws

9. Labour welfare/QWL

10. Communication

11. Joint consultation, participation, involvement

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Three Basic Approachesto looking at IR:

Pluralism, Unitarism, RadicalismWhat are these?

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Frames of Referencein Industrial Relations

& New Issues in IR

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Frames of Reference: Unitarism & PluralismUnitarism

1. Assumptions about Interests—Common interest/objectives

2. Assumptions about conflict—Inevitable, destructive: Be avoided —Caused by: Poor mgt/communication

3. Assumptions about trade unions—Unwanted intrusion

4. Assumptions about collective bargaining—CB generates workplace conflictrather than resolve it

Pluralism1. Assumptions about Interests

—Mgrs. & employees have: different objectives

2. Assumptions about conflict—Inevitable—Be negotiated—Caused by difference of opinions/values

3. Assumptions about trade unions—Not the cause of conflict: Conflict inherent—Legitimate part of workplace relations

4. Assumptions about Collective bargaining—CB ensures fairer outcomes —Balances employee & mgt. power

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III. Marxist (Radical/ Critical) Perspective

• Market economies are social arrangements created by historical forces

• Private property is a social construct, not created by nature

• Owners of capital accumulate capital; take all or most of it

• Power of ownership & control cause WM’s impoverishment

• Classes struggle: for control of industry, economy & state

• Differential access to education, media, government jobs

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III. Marxist (Radical) Perspective contd…

• View of society based on post-capitalism is wrong––Capitalist profit is key influence on co. policy

•Control enforced downwards by capital’s agents––Surplus value generation by capitalist

• Employees socialized into accepting status quo

•Class conflict is the source of societal change––Without conflict society will stagnate

•Capitalism will collapse due to its inherent contradictions

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III. Marxist Perspective contd…

• CB: limited accommodation of fundamental divisions––Unions/IR instts. deal with marginal issues

• Law not independent referee

• Industrial Justice: only if revolution

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How do we Conceptualizethe Different Workings of

IR System?

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I. Traditional Pluralism(German Pharma)

II. Paternalistic Pluralism(Tata Steel/NDPL)

III. Ambivalent Pluralism(Most unionized cos.Maruti-Suzuki Ltd.)

IV. Repressive Pluralism(Simran Foods Ltd.)

V. Coercive Unitarism(Glaziano before the violence; SMEs)

VI. Ambivalent Unitarism(Or manoeuvredunitarism through law, shenanigans, paternalism, collusion with bureaucracy)

VII. Paternalistic Unitarism

(Most Indian SMEs, Flaxo Exports)

VIII. IBM type Unitarism(New Unitarism)

(Hero-Honda, Air Tel)

Eight Broad Typologies of IR Models

© Debi Saini 2010

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What can be Learnt from these two Sessions:• Conflict in industry is inevitable, given different interests

• Variegated models of IR are practiced by different organizations

• IR is a system of rule-making about gains of & power in industry

• IR concept is changing into employee relations in new era

• IR focuses on actors, institutions, procedures

• Unitarism & Pluralism are 2 broad approaches to IR

• IR can be divided into 8 broad typologies

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3-4. Traditional & ChangingIR Perspectives &

Emerging IR StrategiesDebi S. Saini

Professor of HRMManagement Development Institute, Gurgaon

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This presentation focuses on the following issues:

1. Changing world of work; emergence of new thinking

2. New developments in industrial relations

3. New Focus: union-substitution & Employee Engagement

4. Strategic IR agenda & Re-orienting key actors in IR

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Changes in World of Work

and new pointers in IR

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The Evolution of Employment Systems Since 1980sThe Evolution of Employment Systems Since 1980s• The “old” system based on implicit job security is “dead” (Cappelli, 2000)

• It is argued that the old system should be replaced by a “new” equilibrium in which job security is replaced by something else

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I. Traditional Pluralism(German Pharma)

II. Paternalistic Pluralism(Tata Steel/NDPL)

III. Ambivalent Pluralism(Most unionized cos.Maruti-Suzuki Ltd.)

IV. Repressive Pluralism(Simran Foods Ltd.)

V. Coercive Unitarism(Glaziano before the violence; SMEs)

VI. Ambivalent Unitarism(Or manoeuvredunitarism through law, shenanigans, paternalism, collusion with bureaucracy)

VII. Paternalistic Unitarism

(Most Indian SMEs, Flaxo Exports)

VIII. IBM type Unitarism(New Unitarism)

(Hero-Honda, Air Tel)

Eight Broad Typologies of IR Models

© Debi Saini 2010

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New Developmentsin

Industrial Relations

Shifts from IR to Employee Relations

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1. Changing role of state

2. Unions in crisis (bldg. cooperation)

3. New actors in IR: e.g. Consumers/society

4. Emergence of Cooperative bargaining

5. Emphasis on performance-related pay

6. Pressures on labour law rigidity

7. Changing role of ILO: Decent work

8. Employers’ Primacy on flexibility9. IR impacted by HR philosophy

New Developments in Employee Relations

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1. Changing Role of State

• Welfare state: inefficient

• Government as facilitator

• Social justice to market & trickle down

• Changed labour policies of states:

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2. Union-dilution is Major Agenda: Causes• Shift: adversarial to cooperative IR:

—Also called Individualized IR

• State’s primacy to productivity

• Service orgs.: white/gold-collar WM

• Declining core; rising periphery WM

• Influence of HRM Philosophy

• Employment of labour law consultants

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Globalization and Crisis in Unionism Globalization and Crisis in Unionism

• Decline Decline inin Union Union PresencePresence (density)(density)

•• Decline Decline inin Union Union Influence Influence (reach)(reach)

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Country 1970 1980 1990 1997 2003Austria 63.6 59.6 56.2 46.6 35.2

Denmark 62.6 87.8 88.9 89.9 75.5

France 21.0 17.1 9.2 8.6 5.8

Germany 37.7 40.6 38.5 33.4 22.2

Italy 38.5 49.0 39.2 38.0 47.1

Netherlands 39.8 39.4 29.5 28.9 23.9

Norway 57.9 64.4 70.3 71.3 63.0

Spain - 13.8 16.8 15.1 11.5

Sweden 66.6 78.2 82.4 86.4 78.0UK 48.5 54.5 38.1 30.2 25.9

Tab. 1: Percentage of Trade Union members among Total Workforce in Selected Industrialized Countries

Source: Accessed on 12 January, 2006 from Cornell Institute of Industrial Relations (IR) Statistical Record on Trade union Membership at http://www.ilr.cornell.edu/library/downloads/FAQ/UNIONSTATS2002.pdf

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3. New Actors in IR 1. Multilateral IR: consumer/society

2. New issues:––Customer Creation and sustenance ––Protecting environment

––Gender issues ––Safety promotion––Child labour abolition

3. Media’s role in new issues

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4. Emergence of Cooperative Bargaining

1. Shift: industry level to unit level CB

2. Squeezing of bargaining zone

3. Pressure: fear of corp. incompetence

Earlier: fear of corporate power

4. New clauses:Productivity linkage & Wage/benefits cut

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5. Emphasis on Performance-related Pay (PRP)

• Flexible pay

• Cost saving: a big concern

• Competencies & results are imp.

• Knowledge pay in high-tech. industries

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6. Pressure on Labour Law FrameworkPressure on Legislature

––Do not allow union militancy; co. have to compete globally

––Flexible workforce: withdraw Ch-VB of IDA

––Keep away law of Employee Participation

––Respect sanctity of managers’ rights

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7. Change in ILO’s AgendaILO’s desire for adaptation, renewal, change

• From adversarial C.B. to sophisticated compromise “Securing decent work for women and men everywhere”

• Common purpose––For all three social partners

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8. Flexibility: Key in New Era

What is labour flexibility?

The ability to adjust the size and mix of labour inputsin response to changes in product demandso that org. doesn’t have excess labour

Hard and Soft issues in Flexibility

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9. HRM Philosophy & Psychological contract

It is a philosophy of people-mgt:

• Identify & enforce behaviour

• Aims: Competitive advantage

• Focus on new interventions

• PM & IR merged to produce positive energy

• HRM strategy is the Single most imp. Consultancy Area

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Working TowardsHPWS & Employee Cooperation

throughNeo-Unitarist & Neo-Pluralist

Strategies

A High Performing Organization (HPO) is one that is

able to produce extraordinary results &

consistently displays the ability

to sustain performance over time

and over changing circumstances.

Leaders need to Build World-Class Organization, an HPO

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Shifting Strategic Tools: McKenzie’s 7-S FrameworkDeveloped by Peters & Waterman

Strategy Structure

Style Systems

Staff Shared Values

Skills

StrategicFramework

& Tools

7 elements or strategic tools in an org. that must be aligned for business to be successfulShifts from Systems to People-centricity

Range of Interventions are used for Org. Culture

A pat on those who work with

you: A symbol

of your care for them

Luxurious facilities to, & Care for, employees So that they do not have home worries

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Union-Substitution Strategies and

Employee Engagement

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Neo-Unitarism through Union Substitution

UnionSubstitution attemptsThrough Progressive

HR

EmpEmp Involvement,Involvement,empowermentempowerment

AttractiveAttractiveReward strategy Reward strategy

CultureCultureBuilding, flexibilityBuilding, flexibilityIndividual diversityIndividual diversity

Maximize Maximize opportunitiesopportunities

DesignDesignsatisfying jobssatisfying jobs

Strategic Strategic SelectionSelection

Investment in Investment in HRD for WM HRD for WM & managers& managers

Make workplace Make workplace funfulfunful & implement& implement

Fair standardsFair standards

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Practicing Strategic IRand Building

Developmental Agendafor promoting New IR

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Towards Developing Strategic IR Two Dimensions

I. Competency-building amongst mgt. & union• Management (at different hierarchical levels)• Unions

II. New Approach to Developing Processes (OCTAPACE)

• Openness• Confrontation• Trust• Autonomy• Proactivity• Authenticity• Collaboration• Experimentation

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Re-orienting the Top Management• De-humanization often seen especially in larger bureaucracies

• CEO’s personal predisposition is critical––His beliefs about union—People policies—IR policies—Mgt.

• Top mgt. shapes org. culture: Through: beliefs, actions, styles

• Development of top management should aim at:

––Becoming aware of biases & prejudices––Learning to treat IR as important managerial business

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Developing Middle ManagementI. Its competency-building will include:

1. Knowledge about new issues in IR2. Understanding customs/practices in dealing with WM/union3. Knowledge about the legal framework of IR4. Knowledge of history of union & its leadership5. Knowledge about new economic environment/practices

II. Skills1. Skills in diagnosing the problem2. Skills in grievance resolution3. Skills in negotiation4. Skills in communication and inter-personal relations

III. Attitudes1. Orientation to positive problem-solving2. Positive belief-system about existence of union (if one exists)3. Faith in participative decision-making

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Development of Union Leadership

• This requires sensitizing them to various issues:

––General economic and industrial environment

––New technology

––Competitors and their HR practices

––New compulsions of mgt. & need for flexibility

––Need for democratization within trade unions

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Implementing HR Agenda for Workers• Creating developmental climate in general

• Communication & internationalization HR values/goals

• Involve unions in cooperation with workers

• Continuously communicating the HR action areas: EI

• Create right HR architecture to implement intentions

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What can one learn from this presentation?• New order is emerging in IR: called employee relations

• Shifts from adversarialism to neo-pluralism or neo-unitarism

• Shift from shenanigans to trust & cooperation

• Along with traditional issues, new issues have emerged in IR

• Flexibility is one of the most salient concerns of cos.

• Govt.’ new eco. agenda is moving from social justice to growth

• HPWS through union-substitution & employee engagement

• HR strategy: for top mgt.—middle mgt.—union—workers

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5. Trade Unions as Actors in the HRM system:

Debi S. SainiProfessor of HRM


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Trade Unions as actors in HRM SystemObjectives of this session are to discuss the following:• Nature and meaning of trade union

• Role and functions of trade unions

• Overview of the Trade Unions Act 1926

• Rights & liabilities of a trade union

• Issues in recognition of unions

• De-unionization strategies of employers

• What should Indian unions do to remain relevant in today’s era

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Meaning and Natureof

Trade Unionism

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Meaning of Trade Unions

Nature

Unions: A major component (actor) of IRS

Meaning:

An organizationformed by employeesto protect their interests including improving working conditions

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A Working Definition: (Salamon, 1998)

• “Any organization,• whose membership consists of employees,• which seeks to organize & represent their interests

• both in the workplace and society• and in particular,• seeks to regulate the employment relationship• through the direct process of• collective bargaining with management”

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Union Goals and Philosophy

Business UnionismBusiness Unionism Social (Reform) UnionismSocial (Reform) Unionism

Practice of unionsPractice of unionsseeking to improveseeking to improvethe wages, hours,the wages, hours,and workingand workingconditionsconditionsin a businesslike in a businesslike mannermanner

A characteristic ofA characteristic ofunions seeking to furtherunions seeking to further

members’ interests bymembers’ interests byinfluencing the social,influencing the social,

economic, and legaleconomic, and legalpolicies ofpolicies of

governments governments

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Union Structure and Function

National/Intl. UnionsNational/Intl. Unions• Many local unions are part

of a larger national or international union

• (e.g. ICFTU)

Local UnionsLocal Unions

• Basic unit of union organization formed in a particular plant or locality

Craft UnionsCraft Unions

• Composed of workers who possess the same skills or trade

Industrial UnionsIndustrial Unions

• Includes the unskilled and semiskilled workers at a particular location

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Trade Unions Act 1926

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Trade Union under TUA: Definition2 (h) “Trade Union” means

any combination, whether temporary or permanent,formed primarily for the purpose of

regulating the relations between

workmen and employers, or between workmen and workmen,or between employers and employers,

or for imposing restrictive conditions on the conduct of any trade or business,and includesany federation of 2 or more TUs:

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T U Act 1926: Components• The Act consists of 33 sections: Deals with these:

––Regis.––Rights/liab.––Regulations––Penalties/procedures

• Extends to whole India: Provides registration/immunities

• Act amended in 1948 to provide for recognition––But never notified by Government

• Act amended in 2001: Checks multiplicity

• Administered by “appropriate government”

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Salient Features of TU Act 19261. Provides who can register a T.U.:

––Any 7 or more WM employed in industry/ trade can––Later added: At least 10% or 100 whichever is less

2. Registrar of TUs: in each state––procedure for regis. ––Appeal

3. Min. subscription: Rs. 1/ 3/ 12 p.a. (Rural/Unorganized/org. sectors)

4. Envisages general/political funds of a TU: Politicization

5. Outsiders permitted as TU members

6. Rights of TUs: Immunities to TU/members (Criminal/civil)

7. Obligation of TUs envisaged: Also to file returns

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TU under the TU Act 19262 (h) “Trade Union” meansany combination, whether temporary or permanent,formed primarily for the purpose of regulating the relations between

workmen & employers, or between WM & WM,or between employers and employers,

or for imposing restrictive conditions on the conduct of any trade or business,

and includes

any federation of 2 or more TUs:

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Roleof

Trade Unionism

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Why Unions Evolved

1. Easy to fight for rights collectively

2. Innate people desire to seek protection––Desire increases with social/political/economic advancement

3. Unions as footholds to political parties

4. Employers find it easy to deal with groups

5. Countervailing power: social legitimacy

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Unions: Broad Areas of FunctionsExercise of Power: Key Function

“A TU is first & foremosta medium of power” (R. Hyman)

Sources of power:––Its resources–– Negotiation skills––Collection strength––Political support––Unions do research on: economy, court cases

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Determinants of Trade Union’s Power

• TU’s power in labour movement, depends on:––Its Size––Leadership quality––Alliance between unions

• TU’s power towards Govt.: Depends on Govt’s desire to support

• Its power towards employers depends on:––Union density––Economic, technological, political factors

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Union Power used for Various functions1. Economic Regulation

––Protecting terms & conditions ––Fighting against PRP

2. Job Regulation ––Joint rule-making ––WM dignity ––Attack on this by HRD/EI

3. Social change––Adopting political role: ILC, strikes, ILO, laws, advisory boards

4. Member services––Welfare services––WM Education––organization––information

5. Self fulfilment: Mechanism to individuals to develop leadership

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History of Trade Unionism

In India

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Early History of T. U. in India

• Earliest TUs organized: Bombay, Calcutta, Madras––Industries: Cotton textiles, jute, railways

• One of 1st lab orgs.: Bombay Mill Hand Assn.––Formed in 1890: was a welfare organization

• Gandhi’s satyagraha: Ahmedabad in 1917:––50% wage hike demanded: Rejection––Strike––Gandhiji said: 35% fair––WM pledged for strike––Gandhiji on fast after 3 weeks of strike: Accepted––This was 1st major union success: Fillip to unionism

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Early History of T. U. in India contd…

• 1st TU: Madras Lab Union (1918: by BP Wadia)––Organized WM of Binny Mills Ltd.

•TLA: organized in 1920 by Ansuyaben Sarabhai

• Madras Labour Union strike call in 1920––Suit for damages/injunction––Damages awarded: Rs. 75000, Union held a conspiracy

• Binny Mills (Mad HC) case: led to TU Act in 1926––Unionism accepted also due to check spread of communism

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Why Outsiders in Unions1. Low union participation & lack of interest

2. Poor earnings and lack of leisure time

3. Political parties' attempt to widen base

4. WM’s need protection against ULPs

5. Need for negotiators, legal knowledge

6. Instability of workforce/illiteracy/fear of victimization

7. Under-developed class-consciousness

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Union SubstitutionIn the Era of

Globalization

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Union-Substitution Policy of Larger Firms• Union substitution policies of some firms: IBM / Kodak

––This is typical HRM model

• Offering attractive package to employees––Competitive pay––Communication, involvement, info sharing––Induction programme to develop orgl. ethos––Training, career development––Commitment by providing satisfying work

• For success, HRM model should: ––Fit core values of the organization––Reflect integrated approach

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Unions in Crisis: Causes• State’s covert primacy to productivity

• Unitarist/individualized IR: gold-collar WM

• Declining employment––automation

• Emergence of service organizations

• New tech.––white- & Gold-collar WM

• Home working

• Emergence of lean, mean, green organization

• Taylorism to Toyotaism: flexible specialization

• Decline in core; rise in peripheral workforce

• Employment of labour law consultants

• Unipolar world and Post-capitalist society

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Change in ILO’s raison d’etreILO’s desire for adaptation, renewal, change

Adversarial tripartism to sophisticated unitarism--through new paradigm:“Securing decent work for women and men everywhere”

Unity of purpose of the three constituents

Four strategic objectives:--Fundamental principles and rights at work--Employment--Social protection--Social dialogue

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What Should Unions Do to Remain Relevant

in New Era?

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Agenda for Unions in New Era

1. Need to retain political unionism in India--Make Alliances with other union federations

2. Fight with state for rights of contract labour

3. Organize unorganized labour: SEWA/Gramin Bank

4. Workers’ education & skill development

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Agenda for Unions in New Era contd…

5. Cooperate with industry but be firm on rights:--Accept HRM philosophy

6. Understand needs of workers in BPO/IT--Try to provide them service that they need from a union

7. Focus on existing labour law enforcement

8. Curb brief-case trade unionism; improve image

10/1/2012

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6. Legal Framework Of

Industrial Relations

Professor Debi S. Saini([email protected])


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Legal Framework of IR

Issues discussed in the presentation are:• Main laws affecting IR: IDA—IESOA—TUA

• IDA: Objectives, features, definitions

• IR machinery: Conciliation, adjudication, Arbitration

• IInd and IIIrd Schedules under the IDA

• Standing Orders Act: Applicability & Features

• TUA: Features, Rights & Obligations of union

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Background &

Salient Features of IDA

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Principal Laws Affecting IRBasically 3 laws affect IR:

1. The ID Act 1947––Lays down framework for ID resolution

2. The Industrial Employment (Standing Orders) Act, 1946––Promotes uniformity in employment. conditions

3. Trade Unions Act 1926––Registration of TUs & protection for CB

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The IDA: Structure & Background• Principal IR law: Applies to whole of India

• IDA contains: 40 sections + 5 Schedules

• Creates bodies: conciliatory/adjudicatory/administrative

• Rules: ID (Central) Rules, 1947 ––80 Rules + Various formats provided

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Main Features of the ID Act 1947

1. Provides framework of CB for non-mgrl. WM

––Defines ID (S. 2k); workman as non-mgrl. (S. 2s)––Prohibits parties to indulge in ULPs (Sch. V)

2. Provides a consultative/arb./adj. IR model

––Consult: WC; CO; BOC; Court of Inquiry (Ss. 3–6)––Voluntary arbitration of indl. disputes (S. 10-A)––Adj. machinery: LC––IT––NT (one-member bodies)––Though both conciliators/adjudicators need training

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Main Features of the ID Act 1947 contd…

3. Provides re-instatement by LC/IT (S. 11-A/17-B)

4. Provides two sets of lab. adm: Cent./State (S. 2a)

5. Ensures Govt.’s major control in IR/indl. peace

6. Notice for changing the service conditions (Ss. 9-A/33)

7. Regulates strikes/lockouts (for indl. Peace)

8 Restricts lawyers in concil. & adjudi. (S. 36)

Main Definitions in the IDA:Workman, and

Industrial Dispute

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Who is a Workman under IDA [Sec. 2 (s)]Any person (including apprentice)

employed in industry

to do any of the following work:––Manual/unskilled/skilled/tech./operational/clerical/supervisory

for hire or reward (with express or implied terms)

But does not include:

• One who is subject to Army Act/Air Force Act/Navy Act• Employed in police/prison service• Employed mainly in managerial/administrative capacity• Employed as supervisor but draws salary of Rs. 10000+

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Who is a Workman under IDA [Sec. 2 (s)] contd…

Person employed:

Contract of & for employment (Case: Dharagdhra Chemical Works)––Supervision & control––Former is an employee/WM; but latter is an independent contractor––Employer can require what/how; contractor only what is to be done

Designation not of great importance––Nature of duty is the essence ––Mainly clerical & incidentally supervisory is clerical work & vice versa

Piece-rate can also involve master–servant relationship

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Workman contd….

Employed mainly in mgrl./administrative capacity (Standard Vacuum Oil Co. v. Commissioner of Labour)

Held:“If an individual has officers subordinate to himwhose work he is required to oversee,if he has to take decisionsand also is responsible for ensuring thatmatters entrusted to him are efficiently conducted,& an ascertainable section of work is assigned to him,an inference of a position of mgt. would be justifiable”

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What is an Industrial dispute? (S. 2 k.)

Any dispute or difference

between : employers & employersemployers & WMWM & WM

which is connected with

employment, non-employment, terms of employment, or conditions of labour

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Industrial dispute contd…Existence of dispute is central: demand+ rejection

Who can espouse the dispute:––Substantial no. of WM themselves or a union (even minority)––About 20% WM held as substantial––Community of interest is important (Rationale: CB promotion)

Individual dispute per se is not ID unless espoused as collective––Except termination disputes (Sec 2A)

Who can be “Any person”--can even be a non-workman, if community of interest

Authorities Under the IDA

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Authorities under the IDAI. Preventive/Conciliatory Mechanism

1. Works Committee (Section 3)––To be constituted in industries with 100 or + WM––to promote measures for amity and good relations ––& to that end comment on matters of common interest

• Role as agreed by ILC:Conditions of work—Safety—Welfare fund—Recreation—Adjusting of festival holidays—Thrift & savings--Education

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Authorities under the IDA contd…

2. Conciliation Officer (S. 4)

––Can be appointed for an area or industry ––Duty: Promoting the settlement of indl. disputes

3. Board of Conciliation: Constitution & Duty (S. 5)

––Chairman + 2 or 4 members ––Members represent both parties equally––Appointed by govt. on recommendation of parties––Duty: Promoting settlement

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4. Court of Inquiry (S. 6)––To enquire into any matter connected or relevant to an ID

––When appointed: App. Govt. appoints it as occasion arises

––May consist of one independent person or more as specified

––where 2 or more persons mentioned one to act as chairperson

––Rationale: legitimacy to genuineness of claim

––Also: in U.K.: Court of inquiry USA: Fact finding boards

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Authorities under the IDA contd…II. Adjudicatory Mechanism

5. Labour Court (LC) (Section 7)––App. Govt. may constitute one or more labour court/s ––Done for adjudicating ID of any matter in 2nd Schedule––Or for performing such other functions, as specified ––Constitution: Shall consist of One person only

Qualifications:HC Judge/ADJ 3 yrs./Jud. Off. 7 yrs. Or P.O. of LC under a State Act 5 yrs.

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6. Tribunal (Sec 7-A) (Also called Indl. tribunal or IT)

––App. Govt. may constitute one or more IT

––Done for adjudicating any matter in Schs. II/ III

––Constitution: Shall consist of One person only

––Qualification: HC Judge/ADJ for 3 years

––App. Govt. can appoint 2 assessors to assist IT

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7. National Tribunal (Sec 7-B)––Cent. Govt. may constitute one or more NT

––Done for adjudicating IDs, which involve

––Qs. of national importance

––or WM in more than one state are likely to be affected

––Constitution: Shall consist of one person only

––Qualification: High Court Judge

–– C. Govt. may appoint two assessors to assist

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After section 9B of the principal Act, for Chapter IIB, the following Chapter shall be substituted, namely:—

“CHAPTER IIB

Grievance Redressal Machinery: Setting up of Grievance Redressal Machinery

9C. (1) Every indl. establishment with 20 or + workmen to have one or + Grievance Redressal Committee for the resolving individual grievances.

(2) It shall consist of equal no. of members from the employer & workmen.

(3) Chairperson: From employer & WM alternatively on rotation every yr.

(4) Total no. of members of this Committee shall not exceed 6

Provided: one woman member if has 2 members; and if more than it will increase proportionately.

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After sec. 9B of the principal Act, for Chapter IIB, the following Chapter shall be substituted, namely: Contd…

(5) Shall not affect WM’s right to raise ID on same matter under IDA

(6) May complete proceedings: in 30 days on receipt of a written application.

(7) The workman may prefer an appeal to the employer--Who will decide within within 1 month of receipt

--And send a copy of his decision to the workman

Amendment of section 11

(8) This sec. not to apply to workmen for whom there is an established Grievance Redressal Mechanism in the establishment concerned.”.

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Major Schedules in theIDA

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THE SECOND SCHEDULE

1. Propriety/legality of an order passed under SOs

2. Application & interpretation of standard orders (SOs)

3. Discharge/dismissal of WM including re-instatement

4. Withdrawal of any customary concession/privilege

5. Illegality of a strike or lockout

6. All matters other than those specified in 3rd Schedule

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THE THIRD SCHEDULE1. Wages, including period & mode of payment

2. Compensatory & other allowances

3. Hours of work and rest intervals

4. Leave with wages & holidays

5. Bonus, profit sharing, PF & Gratuity

6. Shift working other than as per standing orders

7. Classification by grades

8. Rules of disciplines

9. Rationalisation

10. Retrenchment of WM & closure of establishment

11. Any other matter that may be prescribed

Trade Unions Act 1926

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T U Act 1926: Components

• The Act consists of 33 sections: Deals with these:––Regis.––Rights/liab.––Regulations––Penalties/procedures

• Extends to whole India: Provides registration/immunities

• Act amended in 1948 to provide for recognition––But never notified by Government

• Act amended in 2001: Checks multiplicity

• Administered by “appropriate government”27

Salient Features of TU Act 19261. Provides who can register a T.U.:

––Any 7 or more WM employed in industry/ trade can––Later added: At least 10% or 100 whichever is less

2. Registrar of TUs: in each state––procedure for regis. ––Appeal

3. Min. subscription: Rs. 1/ 3/ 12 p.a. (Rural/Unorganized/org. sectors)

4. Envisages general/political funds of a TU: Politicization

5. Outsiders permitted as TU members

6. Rights of TUs: Immunities to TU/members (Criminal/civil)

7. Obligation of TUs envisaged: Also to file returns 28

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Trade Union under TUA: Definition2 (h) “Trade Union” means

any combination, whether temporary or permanent,formed primarily for the purpose of

regulating the relations between

workmen and employers, or between workmen and workmen,or between employers and employers,

or for imposing restrictive conditions on the conduct of any trade or business,and includesany federation of 2 or more TUs:

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Industrial Employment(Standing Orders)

Act, 1946

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IE (SO) Act: Preliminary & Objectives• The Act seeks to regulate:

––Classification of WM––Discharge/dismissal––Shifts––Disciplinary action––Attendance––Holidays–– provides terms & condns

• Preamble:to define with sufficient precisionthe conditions of employment and to make the said conditions known to WM

• What are St. Orders: Rules––relate to matters in the schedule

• Major features:––precision of working conditions––make the condns. known––give WM a voice in them––uniformity of conditions––regulation of: recruitment, leave, shift, discharge, dismissal 31

IE (SO) Act: Salient features

1. Application:––Every est. with 100 or +WM; App. Govt. can extend: estab. 50 or +WM ––Cent. Government has extended to estab. employing 50 or +

2. Clarify to WM: empl. conds. relating to matters in schedule

3. Meaning of certain major terms:––Wages/WM, same as in IDA––App. Govt. same except controlled industry

4. Cert. Off. can modify/add to SOs & adjudicate––Fairness, reasonableness

5. App. Govt. empowered to frame: Rules, model SOs32

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IE (SO) Act: Salient features contd…

6. Appellate Auth. provided for to hear/decide appeal

7. Provides for subsistance allowance––suspension

8. Provides for temporary application of SOs

9. Penalties provided––Fines only; no imprisonment

10. Model St. orders framed by Central Govt.

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7. Managing Discipline:Legal Issues

Professor Debi S. SainiManagement Development Institute

Gurgaon

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Disciplinary Action for Misconduct by WMObjectives of this session are to discuss the following: • What is meant by misconduct?

• What acts of misconduct are mentioned in SOs?

• How Broad Steps are involved in Disciplinary Action?

• Who can be an Enquiry Officer; what points to be kept in mind?

• What points are involved in considering WM’s reply?

• What considerations decide appointing an Enquiry Officer?

• What considerations are kept in mind in conducting an inquiry?

• What are the principles of natural justice?

• What punishments can be given for a misconduct?

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Discipline aims at =

Teaching &Culture bldg.

Punishmentnot

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What is Misconduct?• Difficult to define

––Not defined in the IDA

• It can be an act as well as an omission

• Generally: An act unbecoming of an employee

• Many times: It is a habitual act––It spoils employer–employee relationship

• Industrial Employment (Standing Orders) Act 1946––Provides for Model Standing Orders––Acts of misconduct laid down in: Model Standing Orders

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Broad Stepsin

Disciplinary Action

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Broad Steps in Disciplinary actionI. Preliminary Enquiry

II. Issuing charge sheet or show cause

III. Considering workman’s reply to the show cause

IV. Appointment of an Enquiry Officer

V. Conducting the Domestic Enquiry––Participants––Procedure––Proceedings––Report

VI. Perusal of Enquiry report by employer

VII. Second show cause, if applicable

IX. Punishment Order

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I.Preliminary Enquiry

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I. Preliminary Enquiry• It is a fact-finding exercise

• Object: To know whether charge sheet be issued

• Charges dropped: If authority satisfied

• Only prima facie assessment, not conclusive

• It shows employer’s fair intention

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II. Charge Sheet

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Issuing Charge SheetWhat is a charge sheet?

• A memorandum of allegations

• Containing charges against the workman

What is its Purpose?

• To tell the WM the nature of charges against him

• So that he gets an opportunity to defend himself

• And offer an explanation

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Issuing Charge Sheet contd…

What should a charge sheet contain?

• Details of allegations

• Not necessary to mention: witnesses, documents relied

• Charges be in form of allegations: “It is reported…”

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Specimen a Charge SheetFrom:Name of appointing OfficerDesignationAddress of the Officer

ToName of the employeeCategory & Other Particulars

Charge SheetMemo no. 18 October, 2011It has been reported,1. That on 17th October, 2011 at about 3 p.m., you Shri Mukesh Kumar (category,

etc. ) Asstt. Fitter along with Shri Naresh Chauhan (category, etc.) mounted the roof of the Labour Office and hoisted two flags atop the said building and shouted slogans saying that workmen must unite under the flag to raid the office of the manager and kick the said manager until death. You are therefore prima facie guilty of acts subversive of discipline.

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Specimen a Charge Sheet contd…

2. That on the same day at about the same time when the Asstt. Mgr. Shri R.L. Kaushal who was on duty and was present at the spot, requested you not to behave in that manner and provoke other workmen to resort to violence and further to remove the said flags from the roof of the aforesaid buildings, you and the aforesaid shri Shekhar Singh abused him in filthy terms such as “ imposter,” “pet dog of the management,” “black sheep,” etc., and threatened to murder him on the spot if the flags hoisted on the roof were removed. You are therefore prima facie guilty of insubordination and acts subversive of discipline. The acts alleged to have been committed by you constitute acts of misconduct under clauses ……… of the Standing Orders and would warrant either your dismissal from the service or any other major punishment.

You are therefore, required to submit, within four days from the date of receipt of this charge sheet , a written statement of reply to me stating whether you desire to be heard in person.

If you fail to submit your explanation within the prescribed time limit it will be presumed that you have no explanation to offer and as such the matter may be disposed off ex parte without further references to you.

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Specimen of a Charge Sheet contd….

If you desire to inspect any document or documents for preparation of your written reply to the charges, you will contact Shri (mention name and designation of the officer) immediately on receipt of the charge sheet. He is being instructed to arrange for your inspection of documents without least delay.

3. Since the charges against you are of grave and serious nature you are hereby placed under suspension with immediate effect pending enquiry and final decision in the matter. During the period of suspension you will be entitled to subsistence allowance as per provisions of law (or standing orders).

Signature (Manager/ employer/ Administrator)DesignationDate

Note: 1. separate charge sheet has to be served on each delinquent. There should be separate domestic enquiry in respect of each delinquent.2. Delete if there is no standing orders.3. Delete if suspension is not necessary or if the workman has already been

suspended.

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Rules as to Framing/Issuing Charge Sheet

• Language: be understandable to workman

• Refer to: SOs/Service rules/period & time of commission

• Who can issue: Appointing authority/authorised person

• If past misconduct relied: Mention it in charge sheet

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Rules as to Framing/Issuing Charge Sheet contd…• Time given for reply

––Be reasonable: 4 to 7 days; extend if workman asks for it

• Service of charge sheet––Get WM’s signature on a duplicate copy––If he refuses to take it, have it endorsed by two witnesses––Send it by registered post––If still refuses: publish it in a daily of wide circulation

• Refusal to accept: a misconduct

• Tearing it in front of server: a serious misconduct

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III. Considering the Workman’s

Reply

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• If WM’s reply unsatisfactory––Employer informs WM about holding inquiry

• Suspension pending enquiry––Should be conferred by standing orders––If not: full wages during suspension pending enquiry

• If WM accepts guilt: Mgt. can take action––Should convey penalty in writing

• Subsistence allowance––If not paid, enquiry vitiated––Case: Re.1 a day paid: Held inadequate, inquiry vitiated

III.Considering the Workman’s Reply

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How much subsistence allowance?

• Provided in Industrial Employment (SO) Act

• Rate: 50% of wages for first 3 months; 75% for rest

• SOs can provide it at a better rate

• To be given even in orgs. having –50 WM

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IV. Appointmentof

Enquiry Officer

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IV. Appointment of Enquiry OfficerWho is he?

––Can be an officer of the establishment

––Can be an outsider, including a lawyer

When disqualified?

––If has a bias

––Has personal interest

––Is an eye-witness

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Employer to Notify Inquiry Officer Appointment

• Employer to notify WM about inquiry––If he does not do so, inquiry is vitiated

• Rationale of employer’s obligation:––WM gets time to prepare his self-defence––WM can arrange matching skill

• What should this notice contain?––Information about Enquiry Officer––Information about: date, time, place

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V. Conductingthe

Enquiry

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V. Conducting the EnquiryA. Rules as to conducting enquiry

1. Enquiry Officer to read out charge––Explain the charge, ask if he understands

2. Allowing WM to have a representative

––Usually, a co-worker or TU leader allowed––Allow advocate only if SOs provide for it

[J. Ahmadi in Crysant Dyes & Chemicals v. RN Tripathi (1993, SC)]

––Earlier, advocate was allowed to represent WM if:WM illiterate or Mgt. rep. a skilled person (LL.B; conducts enquiry)

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Rules as to conducting enquiry contd…3. Hold enquiry in WM’s presence

––Unless WM refuses to participate

4. Employer to bring material evidence on record––Material witnesses on record––Copies of documents: Late coming (Muster roll); false medical (Dr.)

5. Examining employer’s witness first, WM’s later

6. Observing principles of natural justice

7. Giving a copy of findings to WM

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V. Conducting the Enquiry contd…B. Examining Witnesses• Examining mgt. witnesses first

––In ACC (1963) case, WM’s witnesses examined firstHeld: Procedure vitiated

––British School: watchman asked 50 Qs. first–Held vitiated

• Procedure of examining employer’s witnesses––Examining the witness in front of both parties––Cross-examining the witness––If WM does not want to cross-examine, record this fact––Witnesses be called one by one

––Don’t examine one witness in front of another––In the end, both parties and witness sign proceeding

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B. Examining Witnesses contd… • Procedure of examining WM’s witnesses: same

• Give full opportunity to defend to WM

––Allowing oral evidence––Witnesses and documentary evidence––Taking WM’s signature on proceedings

Urdu case: “WM wrote: all written is wrong”Held: Employer should have engaged a language expert

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V. Conducting the Enquiry contd…

C. Principles of Natural Justice: Mainly 3

1. Hear the other side (audi altrem partem)

2. No one shall be a judge in one’s own cause

3. Reasoned decisions

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V. Conducting the Enquiry contd…

• Receipt of findings’ copy by WM & employer

––If findings’ copy not given: Held, enquiry is vitiated––In Ramjan’s case (1991, SC) it was so held ––Findings copy be given even if SOs don’t provide

• Format of Enquiry Report

––Introduction––Charges––Gist of evidence: WM and Employer––Findings based on reason

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VI. Perusalof Report

by the Authority

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VI. Perusal of Report by the Authority

• Authority decides action after perusing report

• Authority needn’t accept findings; but give reasons

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VII. Second Show Cause

in Some cases

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VII. Second Show Cause in Some Cases

• To be given if SOs provide for it ––If not provided, enquiry vitiated

• Contents: ––Mention proposed action with a copy of report––State why action should not be taken

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Punishments

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PunishmentsMinor Punishments

1. Oral reprimand

2. Written reprimand

3. Loss of privilege

4. Fines

5. Punitive suspension

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Punishments contd…Major Punishments

1. Withholding of increments

2. Demotion

3. Discharge

4. Dismissal

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Dismissal & Discharge: DifferenceDismissal Discharge

1. A punishment for misconduct 1. Not always a punishment

2. Stigma attached to dismissal 2. Considered less severe punishment

3. No notice required 3. Agreed or reasonable notice required

4. Employer can withhold his 4. Usually entitled to thesecontribution of bonus, gratuity

5. Disciplinary proceedings 5. May or may not be heldto be held ––Can give notice as per SOs

6. Done on basis of notions 6. In cases done on basis of of propriety equity & good conscience

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9. Employee Involvement

as

HR Strategy

Professor Debi S. Saini

([email protected])


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Objectives of this session are to discuss the following:

• EI & EP: Nature & Types of EI: Downward & Upward

• EI as an instrument of employee engagement

• Co. newsletter & Team Briefing: Top down EI

• Team working/suggestion scheme/attitude surveys & EI tools

• QCs: Nature/merits/prerequisites; TQM: Nature/features/themes

HRM and Employee Involvement

mailto:[email protected]

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EI and EP: Recent Thinking contd…

• Thatcherism led to Globalization

• Japanization in HRM was seen attractive

• Shift from Collective bargaining to HRM: EI a key theme

• HRM/New IR aim to Build employee commitment

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How is EI Linked to Japanese Mgt. Practices

• Japan exemplary in participatory practices

• Impact of Confucius: leadership theorist

––Cooperation and harmony

––Social hierarchy through benevolent leader

––Leader to act in interest of followers: Young to respect sr.

• Export of Japanization to other countries esp. UK

––Used partly to water down pluralist UK attitude

Confucius

551 to 479 B.C.

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HRM Philosophy & Employee Involvement

• HRM/excellence movement in 1980s: EI

––Tom Peters: “People are most valuable asset”

• HRM: Mgrl. aversion to EP in general—But EI helps

• EI reflects: managerial strategies for productivity

––Not for building a participatory society

• Shift from Taylorism: i.e. indl. revolution model of HR mgt.

• Taylorism reflects: Control—Discipline—Sanctions—Direction

• As in music, even in business there is a Shift to involvement/teams

• EI seeks to intertwine trust & responsibility

• The idea: Help & take others along with you

What is Noticeable in People Mgt. Today?

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Employee Participation

and

Involvement: Historical

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Michael Salamon’s Distinctions

• Industrial Democracy:

Worker control

• Employee Participation: Influences decision making

• EI: contribution, understanding,

commitment & Engagement

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Nature

of

Employee Involvement

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Meaning of EI and EP

Employee Participation: Refers to

• State or collective-employee initiatives in promoting

collective representation of employees

in organizational decision-making

possibly in face of employer resistance

(Hyman & Mason, 1995)

EP includes financial participation & profit sharing

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Meaning of EI and EP


• EI is a strategic device used by mgt.

in promoting employee commitment

& the cooperation of the workforce

through information given directly

(not representatives)

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&

Engagement: What Does Research Say?

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Cummings & Worley, 8e (c)2005 Thomson/South-Western

EI and Productivity

Employee

Involvement

Intervention

Improved

Communication

and Coordination

Improved

Motivation

Improved

Capabilities

Improved

Productivity

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Types of


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Types of Employee Involvement

Downward communication––top-down

I. In-house journals/company newsletters

II. Team-briefing sessions

Upwards problem-solving forms

III. Team Working

IV. Suggestion schemes & problem-solving grs.

V. Attitude surveys

VI. QCs

VII. TQM

Communication

is key

The synergy

of team

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II. Team Briefing

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Social events are particularly reported to promote employee ownership

A device to involve everyone in the organization

level by level in face to face meetings

organized by line managers

to present, receive, discuss info.

approved by top management

on a regular basis

by providing a two-way communication

• Aimed to replace casualism, & inject order in system

• It was viewed as productivity breakthrough of 1990s

(Fortune magazine)

II. Team Briefing (TB): What is it?

Team-briefing session

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II. Team Briefing (TB) contd…

• TB seen as a key ingredient of the new IR/HRM

• Changed focus ––In 1980s: bad news to convey;

Now: maintain initiative

• Organization:

––Covers all levels

––between 4 to 15 in each gr.

––run by immediate leader of group at each level

––leader be properly trained and briefed

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II. Team Briefing (TB) contd…

• Subjects:

––Explains new and changed policies––Explaining co. plans

––Telling progress in aspects of organizational functioning

––People: appointments, personnel matters

––Feed back to top––Provides for two-way communication

• Timing & duration:

• At least once a month for incharges

––Once in 2 months for others

• But meet only if something to say––Duration be about 20-30 Mnts.

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III. Team Working

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B. Upward Forms of Communication

III. Team Working [originated in Japan]

• Focus: problem-solving in a Group—Team Size:7-10

• It is a recent initiative in EI

• Not as widespread as TQM; but its influence spreading

• It requires task flexibility & job rotation

• Training in: team culture/inter-personal skills/communication

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IV. Suggestion

Schemes

Creative ideas needed

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IV. Suggestion Schemes: What is it?

A method providing established procedure

for submitting & evaluating ideas

so as to recognize meritorious ideas

without discouraging unacceptable ones

Products of creative ideas

Employee Suggestion Scheme at Maruti-Suzuki

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•Maruti-Suzuki has employee suggestion scheme

• Received about 229,000 suggestions in 2010-11 --Saved about Rs 1.6 B. in 2010-11 by implementing it

• Saved Rs 2 B. in 2009-10

• It claims use of transparency at all levels

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V. Attitude Surveys

V. Attitude Surveys (AS)--What it is:

• It is a questionnaire survey of employees

• On a one-off or regular basis

• Which is designed to discover their views

• About a variety of factors connected with work

• AS presumes: WM want their views implemented

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• Opinions are taken on a wide range of issues ––Job satisfaction––job specification––Co. org. & mgt.

• Used by large no. of orgs. ––Some use them very regularly: IBM

• Enlightened orgs. make imp. changes in policy

––Cussons (UK, soap mfrs.) introduced equal opportunity policy

––Also, it did training program to tackle employee harassment

V. Attitude Surveys (AS) contd…

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I. Quality Circles

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• A voluntary group of employees

• holding meetings

• to search solutions

• for work-related problems

VI. Quality Circles: What it is

• Members usually from a single deptt., similar work

––Usually 6-12 members + supervisor

• Member trained: Meeting––team bldg.––presentation skills

• A QC may be a part of the TQM programme

• QC implements its recommendation where practicable

––When implemented, QC monitors the process

VI. Quality Circles

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1. Improve communication

2. Increase job satisfaction

3. Stimulate personal growth

4. Increase employee’s sense of involvement

5. Enhance leadership skills

Merits of QCs

32

VI. Quality Circles contd…

– Popular in 1980’s, not as much today

– Positive impact on productivity

– But incidentally, little effect on satisfaction

Many Problems led to Dilution of Their Effectiveness

• Inadequate training

• Not truly voluntary

• Indifference of management

• Not really empowered to decide Source: www.freequality.org/beta%20freequal/fq%20web%20site/Training/ Classes%20Spring%202002/Quality%20Circles.ppt

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33

VII. Total

Quality

Management

• A total company wide effort

• that includes employees, suppliers, customers

• that seeks continuously to improve quality

• of products and processes

• to meet customers’ needs/expectations (Dean & Evans, 1994)

Definition of Total Quality Management

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35

What does TQM Pre-suppose?

• That everyone in organization understands

The expectations of the customer

And meets the expectations every time

Based on Presumption of two Achievable Results

• Lower the cost of operations

• Improve the quality delivered

And thus attract the customer

36

Working of


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1. Mgt’s willingness to concede some prerogatives

2. Training of mgrs/WM in group-working skills

––Presentation––Leadership––Assertiveness––Problem-solving

3. Provision of proper feedback mechanisms

4. Taking action to implement group decisions

5. Realize: Conflict helps developing initiative

Factors Impacting Working of EI

• Contradiction in mgrs’ projections & practices

• Control by top mgt; Resist power shift to WM

––EP and even EI perceived as a power challenge

• Japanese practices possible if workforce compliant

––And, also it works in situation of high-unemployment

Reality of EI at Global Level: Lessons

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• EI used only for efficiency of organization

––Dilemma: how much power to give for creative energy

––Undermining of managerial prerogatives not tolerated

––New technology, TQM, culture change are used for control

Reality of EI at Global Level: Lessons contd…

40

How To Overcome EI Challenges?

• Cultural Differences

– EI works better in low power-distance cultures (e.g.Japan)

• Management Resistance

– Solution: Train mgrs. as facilitators

• Unions Resist; see it as dilution of rights/power

– Solution: Promote trust and involvement

Copyright © 2008 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin

11. Transformational

Leadership Development:

the Essence of SHRM

Dr. Debi S. Saini

Professor & Chairperson—HRM Area

Management Development Institute, Gurgaon-122007

Issues discussed in this Session:

• Linking leadership with SHRM

• Film analysis: Transformational Competencies

• Transactional & Transformational leaders

• People & Task concerns: GRID Theory

• Changing perceptions through leadership dev.

3

Cooperation/Engagement

Is the essence of Strategic HRM: Need to Change People’s Perception

4

The above realities necessitate

Developing

Transformational Leadership

for Employee Engagement

5

Learn to Lead Change in Chaotic Comptt.:

Jack Welch--From a Cost-cutting Butcher to Change Master

Jack Welch took GE

from a 13 B. to 500 B. Company

in 20 years

6

Leaders Focus on Culture & Outcome; not Rules

1. Develop business vision

2. Culture to achieve vision

3. Flatten the organization

4. Eliminate bureaucracy

5. Empower individuals

6. Raise quality & efficiency

7. Eliminate boundaries

Welch’s 7 Point Program for

Mgt by Leadership

GE Market

Capitalization

Sam Pitroda

espoused a mission

for the masses of India

He became the architect of

the telecom revolution in India

He led changes

in structure & culture

at a massive scale

to provide a tele-network

of global standard

Great Leaders Inspire;

Create Enthusiasm

Enthusiasm is Highly contagious

• “Without doubt, the head of HR should be

the 2nd most important person

in any organization. from the point of view of CEO,

the HR director should be at least equal to CFO.” --Jack Welch

9

What do you Think are

the Leadership Qualities

Shown by

the Successful Jailor

Transformational Leadership Involves:

1. Vision—Orgl.; individual

2. Team-building

3. Trusts

4. Results/task balancing

5. Charisma (see him in sky as well)

6. Risk-taking

7. Paternalism/Care (Indian context)

8. Credibility/integrity

9. Listening/Communication

10. Empathy

11. Good human-being

12. Guiding/Counseling

13. Change master

14. Servant leadership

15. Transparency

16. Diversity mgt.

17. Idiosyncratic passion

18. Admits failure

19. Social responsibility

20. Inter-personal skills

21. Inspires

22. Leads by example

23. Compassion

24. Empowers/delegates

25. Tact

26. Emotional intelligence

27. Metrics:

Who is a Transformational Leader?

Burns (1978)

A transformational leader is one

who looks for potential motives in followers,

seeking to satisfy higher needs,

and engages the full person of the follower

TL: inspires their followers

to go beyond the calls of duty

and acts as mentor

Who is a Transformational Leader?

“The goal of transformational leadership

is to “transform” people & orgs. in a literal sense

—to change them in mind and heart;

enlarge vision, insight, and understanding;

clarify purposes;

make behavior congruent with beliefs, principles, or values;

and bring about changes that are

permanent, self-perpetuating, & momentum building.”

Steven Covey, Author of 7 Habits of Highly Successful People

Since late 1970’s (James Burn), a ‘New leadership’ model talked

1. Vision, look for potential motives inspire Ideas &

create shared “dreams”

2. Integrity: Honest & credible; acts out of conviction

3. Charisma: Uses emotion for faith, loyalty, pride, TRUST

4. Empower: Helps others develop, delegates challenging work

5. Symbolism: Identifies “heroes,”: celebrates excellence

6. Proactive Communication: orally & with body language

7.Desired culture: Teach—Be Innovative—Build leaders—Use Metrics

What do Transformational Leaders do?

Transformational & Transactional Leadership: Difference

Category Transactional Transformational

Source of power Rank, position Character, competence

Follower reaction Compliance Commitment

Time frame Short-term Long-term

Rewards Pay, promotion, etc. Pride, self-esteem, etc.

Supervision/Control Important Less important

Counseling focus Evaluation Inspiration/Development

Where change occurs Follower behavior Follower attitude, values

Where leadership found Leader’s behavior Follower’s heart

1

5

Let us Look at

these two Situations:

Task & People Need:

GRID

R.R. Blake & Jane S. Mouton Leadership Grid

Low

High

Low High 9 7 8

9

6 5 4 3 2 1

1

2

3

4

5

6

7

8

Concern for Production

Concern for

People

1,9

9,1 1,1

9,9

5,5

Country Club Mgt. Team Management

Impoverished Mgt. Authority-Compliance

Middle of the Road Mgt.

Thoughtful attention to the

needs of people for satisfying

relationships leads to a com-

fortable, friendly org.

atmosphere and work tempo

Work accomplishment is from

committed people; interdependence

through a “common stake” in org.

goals leads to relation of trust/respect

Exertion of minimum effort to get

required work done is appropriate

to sustain org. membership.

Adequate org. performance is possible

through balancing the necessity to get

out work with maintaining morale of

people at a satisfactory level.

Efficiency in operations results

from arranging conditions of work

in such a way that human elements

interfere to a minimum degree.

Source: Robert R. Blake and Jane S. Mouton.

Interpersonal Orientation Task Orientation

• Solicits opinions

• Recognizes others’ positions/ideas

• Flexible, open communication

• Listens carefully

• Makes requests

• Focus: Feelings, emotions, needs

• Productivity through personal skills

• Mostly communicates orally

• Maintains open-door policy

• Disseminates info.

• Ignores others’ positions/ ideas

• Rigid communication

• Interrupts others

• Makes demands

• Focus: Data/info. on tasks

• Productivity through tech. skills

• Mostly communicates in writing

• Maintains “closed door” policy

Be an Emotionally Intelligent Leader

• They manage interpersonal relationships & build networks (teams)

[D. Goleman’s 5 components of EI leaders]:

• Self-awareness

• Self-regulation

• Motivation

• Empathy (Understand & share feelings of another)

• Social skills (inter-personal)

Daniel Goleman, Ph.D.

What is EI

• EI is the ability

to identify, assess, & control

the emotions

of oneself, of others, & of grs.

What Have we Focused on in This Session?

• HR must facilitate cooperation through Leadership

• Transformatl. leadership is most used framework

• Leaders must inspire, care, be fair, honest, measure

• Leading is different from managing

• Important to balance task/people needs in managing

• SHRM is difficult to implement without transfl leadership

Documents

Term 2 mid sem HRM