CH-03 Asjad Sir

8/13/2019 CH-03 Asjad Sir

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Changing Profiles of Major Stakeholders of Industrial Relations in India

3Chapter

Changing Profiles of

Major Stakeholders of

Industrial Relations in India


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Trade Unions

1. Blue Collar-Workers' Trade UnionTrade Unionism grew as one of the most powerful socio-economic political

institutions of our time - to fill in the vacuum created by industrial revolution in the

industrial society. It came as a countervailing force to reconcile social and economic

aberrations created by Industrial Revolution.

FORMATIVE STAGES

Trade Union had to pass through a very difficult and hostile period in the initial

years. The employers wanted to crush them with iron hands.

Then came the period of agitation and occasional acceptance.

When the union gained strength, they started confronting the employer. This isthe period of struggle which continued for long.

Employers were forced to accommodate, tolerate and hesitatingly accept them.

Then came the period of understanding collective bargaining in the industry.


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DEFINITION

Trade union is an association either of employees or employers or of

independent workers.

It is relatively a permanent formation of workers. It is not a temporary or casual

combination of workers.

It is formed for securing certain economic (like better wages, better working

and living conditions), and social (such as educational, recreational, medical,

respect for individual) benefits to members.

A more recent and non-legislative definition of a union is:

"An organisation of workers acting collectively, who seek to protect and promote

their mutual interests through collective bargaining".

De Cenzo and Robb ins (1993)


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FORMS OF TRADE UNIONS

1. Classical: A trade union's main objective is to collectively protect the interestsof its members in a given socio-economic-political system.

2. Neo-classical: It goes beyond the classical objectives and tries to improve

other wider issues like tax-reliefs, raising saving rates, etc.

3. Revolut ionary change in the system: Establishing the rule of working class

even through violence, use of force, etc.

Functions of Trade Unions

a) Mil i tant or pro tect ive or intra-mutual func t ions

b) Fraternal or extramural fun ct ion s

c) Pol i t ica l funct ion s

d) Socia l funct ion s


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Objectives of Trade Unions

a) Wages and Salaries

b ) Work ing cond i t ions

c) Discipl ine

d) Personnel po l ic ies

e) Welfare

f) Emp loyee-emplo yer relat ions

g) Negot ia t ing machinery

h ) Safeguarding organisat ional health and the interest of the indus try


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ROLE OF TRADE UNIONS

a) Sect ional Bargainer

b ) Class Bargainer

c) Agents of State

d ) Partners in Social Contro l

e) Union s' role

f) Bu siness Oriented Role

g) Unions as Change Agent


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CLASSIFICATION OF TRADE UNIONS

Classification based on ideology

Revolutionary Unions: Believe in destruction of existing social/economic

order.

Reformist or Welfare Unions: Work for changes and reforms within the

existing socio-political framework of the society - European Model.

Uplift Unions:They advocate extensive reforms well beyond the area ofworking condition.

Classification Based on Trade

Many unions have memberships and jurisdictions based on the trades they

represent. The most narrow in membership is the craft union, which represents

only members certified in a given craft or trade, such as pipe fitting, carpentry

and clerical work.

At the other extreme, in terms of the range of workers represented in the

general union, which has members drawn from all trades. Most unions in India

and Sri Lanka are in this category.


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Classification Based on Agreement

Closed Shop

Union Shop

Preferential Shop

Maintenance Shop

Agency Shop

Open ShopTheories of Trade Unionism

a) Political Revolutionary Theory of Labour Movement of Marx and Engels

b) Webb's Theory of Industrial Democracy

c) Cole's Theory of Union Control of Industry

d) Common's Environment Theory

e) Mitchell's Economic Protection Theory of Trade Unionism

f) Simon's Theory of Monopolistic, anti-Democratic Trade Unionism

g) Perlman's Theory of the "Scarcity Consciousness" of Manual Workers


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GROWTH OF TRADE UNION MOVEMENT AND MEMBERSHIP

Early PeriodEfforts towards organising the workers for their welfare were made during the early

period of industrial development by social workers, philanthropists and other

religious leaders mostly on humanitarian grounds. The first Factories Act, 1881, was

passed on the basis of the recommendations of the Bombay Factory Commission,

1875. Due to the limitations of the Act, the workers in the Bombay Textile Industry

under the leadership of N. Lokhande demanded reduced hours of work, weekly rest

days, mid-day recess and compensation for injuries.

Modest Beginning

The beginning of the Labour Movement in the modern sense started after the

outbreak of World War I in the country. Economic, political and social conditions of

the day influenced the growth of trade union movement in India. Establishment of

International Labour Organisation in 1919 helped the formation of trade unions in

the country.


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Some of the typical Joint Comm ittees are:

1. Compensation Committee2. Welfare Committee

3. Canteen Management Committee

4. Transport Management Committee

5. Sports and Entertainment Committee

6. Employee of the Month Committee

7. Suggestion Committee

8. Employees Health Safety and Environment Management Committee

9. Good House Keeping Committee

10. Grievance Committee




Cont.

TRADE UNION ACT, 1926

The Trade Union Act 1926 legalises the formation of trade unions by allowingemployees to form trade union. It allows trade union to get registered under the Act.

Registration provides legal status to the trade union and it becomes body corporate.

It can hold moveable and immoveable property and can enter into contract and can

sue and can be sued. The Act also provides immunities to the unions from civil and

criminal prosecution for bona fide trade union activities. The Union can generate

General Fund for the day-to-day activities and Political Fund for political activities

(For details - Refer Act).




Cont.

RECOGNITION OF TRADE UNION

The underlying idea of forming a trade union is to negotiate and bargain withemployers to improve the service and employment conditions of workers on their

behalf. This collective bargaining process can be possible only when the employer

recognises the trade union as a bargaining agent and agrees to negotiate with it

because it is difficult to negotiate with multiple trade unions in a single organisation.

The Trade Union Act 1926, is the only Central Law, which regulates the working of

the unions and does not have any provision for recognition of trade unions. Some

attempts were made to include compulsory recognition in the Trade Union Act of

1947, 1950, 1978 and 1988, but these did not get materialised.




Cont.

RIGHTS OF RECOGNISED UNIONS

a) the right to raise issues with the management,b) right to collect membership fees within the premises of the organisation,

c) ability to demand check-off facility,

d) ability to put up a noticeboard on the premises for union announcements,

e) ability to hold discussions with employees at a suitable place within the

premises

f) right to discuss members' grievances with the employer,

g) ability to inspect beforehand a place of employment or work of its members,

and

h) nomination of its representatives on committees formed by the management for

industrial relations purposes as well as in statutory bipartite committees.




Cont.

PROBLEMS CONFRONTING UNIONS AND MEASURES TO STRENGTHEN

TRADE UNION MOVEMENT IN INDIA

Trade Union Leadership

Reasons for Emergence of outside Leadership

The Evil Effects of outside Leadership

Measures to Minimize the Evil Effects of outside Leadership

Measures to Minimise Union Rivalry

Multiple Unions

Union Rivalry

Finance

Other Problems

1. Illiteracy

2. Uneven growth

3. Low membership

4. Heterogeneous nature of labour

5. Lack of Interest

6. Absence of paid office-bearers




Cont.

Measures to strengthen Trade Union Movement in India

The following are some of the measures to minimise trade union problems and to

strengthen the Trade Union Movement of India.

United Labour Front

Efficient Leadership

Membership Fees

Other Measures

BUILDING RESPONSIVE TRADE UNIONISM

i. Inactive Indifferent, none of their business' posture.

ii. Reactive Violent reaction, blocking, rejecting, coercing, striking.

iii. Responsive Addressing, supporting, adopting.

iv. Proactive Agent/catalyst of change.

v. Partnering Responsible, taking risks along with employers.




Cont.

STRATEGY FOR BUILDING RESPONSIBLE TRADE UNIONISM

1. Micro to macro focus

2. Bargain ing to shar ing

3. Groom ing trade union leadership

4. Conf l ic t to col laborat ion

5. Developm ental role

6. Enhancing union inf luence

7. Protect ive regulat ion to self-sus tenance

8. Openness and transparency

9. Effect ive ut i l isat ion of alternat ive forums

10.ACCEPT, SHARE and GROW




Cont.

FEMALE WORKERS and TRADE UNIONS

Female workers in India are mostly employed in the organized sector. Therefore,the trade unions, which initially represented mostly organized workmen, did not pay

much attention to female labour. It is only recently that some national trade union

centers in India have announced that if their affiliates send nominations for

representation at various decision-making levels in the union hierarchy without a

woman member in the panel, they will not consider the panel.

Union membership and union leadership amongst women is higher in some

occupations than in others. In the garment industry, the proportion of women to the

total members could be about 70%. In plantations, hospitals, hotels,

telecommunication, public service, and anganwadis, women occupy positions as

joint secretary/secretary. In teaching and nursing they hold even higher positions.




Cont.

Why Women Do Not Join Unions

1. Family responsibilities-childcare, all household duties-are left mainly to women.

2. Religion, taboos, and cultural inhibitions make it difficult for women to break

into male environments.

3. In the workplace, women are often employed in subordinate positions under

the supervision of men in more powerful positions. The occupational

segregation in union structures create barriers for women's advancement.4. Trade unions are often male dominated because of

The notion that working in the union is a 24 hours a day job, The tendency to hold meetings at night,

Union jargon and sexist language,

Informal male structure(old-boys network), Less interest in women's issues, Less access to education and training for women in many places,




EMERGING TRENDS

1. The customized services hypothesis that union will individualise services.

2. The cyber organizing hypothesis that the Web will produce virtual minority

unions in many non-union firms.

3. The cyber democracy hypothesis that the Web will become an important forum

for industrial disputes.

4. The Web will strengthen the international labour community.

5. The Web will strengthen the international labour community by helping union

exploit the opportunities on the Web to gain membership.




Cont.

2. White-collar Trade Unions

There was a time when unions and strikes were known only to blue-collar workers

in factories, mines, railways docks, etc. White-collar employees and professional

people like doctors, engineers, lawyers, professors and senior executives and

managerial staffs thought it below their dignity to band themselves in unions, march

the high streets and yell slogans. Today, it is different. Trade unions exist among

most professionals, white-collar employees, officers, senior executives and

managers, and so do strikes and gheraos.

C f f S f


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WHITE-COLLAR WORKERS AND BLUE-COLLAR WORKERS

Differences between Blue and White-Collar Workers

S.No. Blue-Collar Worker White Collar Worker

1. All shop -floor workers (Part of the productionteam who operate machines and relatedsystems) are termed as blue -collar workers,as their work is not generally clean.

All clerical or office staff who do notwork on theshop floor, are termed as white -collar workersas their work and working places are clean.

They are generally involved in a desk job orproviding service over the counter.

2. They are manual workers with lower literacy

and education and have their own social andeconomic background.

They are non-manual workers forming a distinct

social ground, characterised by divergent socio-economic backgrounds, level of education,manner of speech, social custom and ideology.They are better educated and ha ve jobsrequiring mental capabilities to a greater extent.

3. They may be paid by time, or by piece, orresults, either on daily, or weekly, orfortnightly, or monthly basis. They are

generally wage earners, and may have lesserholidays, and leave facilit ies and otherprivileges than white-collar workers.

They are time -workers paid on monthly basis.They enjoy longer holidays and leave facilitiesand better privileges.

4. They are not so i nc li ned towardsmanagement. On the other hand, they may becaring f or their unions than for themanagement.

They hold such jobs that they are regarded aspart of the management, and so they are moreinclined towards it than the blue-collar workers.

Ch i P fil f M j St k h ld f I d t i l R l ti i I di


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5. Excepting highly skilled categories who are in

greater demand and can manage to havehigher wages in income, the blue -collarworkers are not so well paid.

Their fringe benefits and perquisites are lowerthan those of white-collar workers.

Because of their professional and social

standing they are generally better paid andhave bet ter t erms and condi tions ofemployment, including better perquisites andfringe benefits.

6 They have better union protection and jobsecurity by labour legislation, such asIndustrial Disputes Act.

They have no union protection if they are notunionised, and also job security if they are notcovered by the Industrial Disputes Act, 1947 as

may be the case with a few of them.7 They are mostly engaged in production

processes.They are concentrated in the fields ofcommerc e, t rans port, st or age andcommunication. They are engaged in differentoccupations that fall under the category ofprofessional, administrative, executive andmanagerial workers, clerical and relatedworkers, sales staff, technical and supervisoryand other workers, engaged in transp ort and

communication services, or in sports andrecreational facilities, artists and musicians.

8 They have no authority, nor are theyassociated with decisiontaking.

They are linked with their employers by beingassociated with that part of the product iveprocess where authority is exercised anddecisions are taken.



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Why White-Collar Workers' Unions?

The growth of white-collar unionism are:

1. Denial of both, job security and social security to them by their exclusion from

the purview of labour laws like Industrial Disputes Act, 1947.

2. Anomalies in pay caused by implementation of the recommendations of Wage

Boards and Pay Commissions.

3. Nationalisation and consequent rationalisation of pay and perquisites.

4. Inconsistent and discriminatory promotion and salary policies which have been

causing so many conflicts and disputes.

5. Gradual narrowing of wages and salary differentials of blue and white-collar

workers due to fast improvement in the wages.

6. Inflation and soaring prices resulting in erosion of pay and standard of living of

white-collar workers and, thus, leading to demand for higher pay, dearness

allowance and annual bonus and other fringe benefits.



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Managerial Associations

Managerial trade unionism is no longer a fiction, but is an established fact. Though

this phenomenon is more than forty years old, it is yet to be considered as

worthwhile to be concerned with, either by the Government or by the Central bodies

of trade unions or by academicians. The Government could not enact a legislation

concerning this aspect of trade unionism or could not introduce some procedure forredressal of grievances of the managerial staff. The Central organisations of trade

unions could have provided leadership or guidance for proper organisation of such

unions. The academicians, if they had wished, could have attempted an indepth

study of managerial unionism and workshops. It is only the corporate managements

who could not ignore this happening. In fact, they are finding it difficult to develop

working relations with their managers and other officers in the absence of any

corporate or national policy on this subject.



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Employers' Associations

Employers' Organisations (EOs) are "formal groups of employers set up to defend,

represent or advise affiliated employers and to strengthen their position in society at

large with respect to labour matters as distinct from economic matters. They may

conclude collective agreements but this is not a formal rule and cannot be an

element of their definition. Unlike trade unions, which are composed of individualpersons, employers' organisations are composed of enterprises. Most legal

definitions of a trade union apply to them (Oechslin, 1990). The Trade Union Act,

1926 includes in its purview, both associations of workers as well as employers.

Employers' Associations came into existence as a result of the formation of ILO andthe growing presence of Trade Unions, especially after the First World War.



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Objectives

Primary

a) Promote and protect the interests of employers engaged in industry, trade and

commerce in India.

b) Study, analyse and disseminate information relating to labour policy, labour-

management relations, collective bargaining, etc.

c) Offer advice concerning various aspects of labour policy.

d) Liaise with Union Government and initiate steps that are representative and

legislative in nature.

Secondary

a) Train and develop staff and members.

b) Obtain data on wages and conditions of work in industries attached to them.

c) Take up projects for social and family welfare.

d) Initiate steps to improve public image and improve public relations.



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Government Policies and Industrial Relations

In the initial years of Industrial Revolution, Government followed the policy of

Laissez faire (non-interference) in settling Employers' and Workers' problems.

Parties were left free to settle scores the way they liked. Towards the end of the

19th century, the change was witnessed in the attitude of the Government. It was

constrained to intervene and bring protective legislations because of the following

reasons:

Pressure from ILO/ILC/SLC.

Pressure from T.U. Movements.

Gandhian philosophy of trusteeship, Govt. felt the need to develop instruments

of voluntarism.

Pressure from Constitutional obligations to fulfil Pledges and Promises as

enshrined in the Preamble, Fundamental Rights and Directive Principles of

State Policies.

Government emerged as the biggest employer.



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ROLE OF THE STATE IN INDUSTRIAL RELATIONS

As the National Commission on Labour (1969) observed, "The concern of the Statein labour matters emanates as much from its obligations to safeguard the interests

of workers and employers, as to ensure to the community, the availability of their

joint product/service at a reasonable price. The extent of its involvement in the

process is determined by the level of social and economic advancement, while the

mode of intervention gets patterned in conformity with the political system obtaining

in the country and the social and cultural traditions of its people."



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CONSTITUTION AND LABOUR POLICIES

The preamble to the Constitution of India provides the framework within which thelabour policies of the organisation can be formulated in India:

"We, the people of India, having solemnly resolved to constitute into a sovereign

socialist secular democratic republic and to secure to all its citizens;

JUSTICE, social, economic and political;

LIBERTY of thought, expression, belief, faith and worship;

EQUALITY of status and of opportunity; and to promote them among all,

FRATERNITY assuring the dignity of the individual and the unity and integrity of theNation"



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Evolution of labour policy during the five year plans

A major landmark event influencing post-independence era labour policies was the

report of the Labour Investigation Committee, 1946. The National Government in

1946 drew up a four-year phased programme to:

a) revise the existing labour legislations to meet the changing needs of the time;

b) eliminate completely and/or control contract labour;

c) extend employment opportunities/exchanges to cover all classes of workers;

d) evolve fair terms of service and deal for workers;

e) fix wages in sweated industries, rationalise rate of dearness allowance to

promote fair wage agreement; and

f) lay down nucleus for an industrial health insurance programme.


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THE WORKING OF TRIPARTISM A CRITICAL ANALYSIS

Tripartite deliberations helped to reach a consensus, inter alia, on statutory

minimum wage fixation (1944), introduction of a health insurance scheme (1945), a

provident fund scheme (1950), leading to the passing of three importance Central

Labour Laws, namely, the Minimum Wages Act, 1948, the Employees' State

Insurance Act, 1948, and the Employees' Provident Fund Act, 1952. the tripartite

deliberations during 1942-46 on the revision of the Trade Disputes Act, 1929 helpedthe Union Government to enact the Industrial Disputes Act, 1947 which laid down

comprehensive disputes settlement procedures to be applicable to all states.

However a few states (e.g. Maharashtra and Gujarat, Madhya Pradesh, Uttar

Pradesh, and Rajasthan) made their own legislation which were operative within the

state boundaries along with the Central legislation. This duality of labour

administration could not be mitigated by the ILC due to obvious limitations set on it

by the inclusive of 'labour' in the 'Concurrent List' of the Constitution.



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BIPARTITE CONSULTATIVE MACHINERY

Towards the realization of the goals set out in the national economic plans, theGovernment of India has also created bipartite consultative machinery for ensuring

cooperation between workers and employers. Here we shall briefly consider the

experience with Joint Consultative Board (JCB) and National Apex Body (NAB).

Joint Consultative Board

A Joint Consultative Board (JCB) of Industry and Labour was set up in 1951 largely

at the initiative of Mr. GL Nanda, then Minister for planning and deputy Chairman of

the Planning Committee of Industries of Planning Commission. To begin with, the

JCB was set up as an official body to consider, advise, and cooperate with theGovernment on matters relating to industrial relations in general and specific issues

such as retrenchment in particular.



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PARADIGM SHIFT IN INDUSTRIAL RELATIONS POLICY OF GOVERNMENT OF

INDIA

Keeping in view the emerging economic scenario, government policies should

make a paradigm shift from regulation, protection and control to enabling,

facilitating and protecting from dispute resolution to social and economic

development.

There should be a gradual decline in the role of the state not too much and

too frequent interventions.

There should be a shift in industrial relation-information sharing, consultation,

communication, transparency and consensus development at all levels.

The state should broad-base their labour policies and labour legislations to

cover unorganised sectors in a big way.

The state should address the problems of diverse labour force-female worker,

bonded labour, child labour, unorganised labour and migrant labour from India

and abroad.



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STATE GOVERNMENTS AND INDUSTRIAL RELATION

Labour is in the Concurrent List of the Constitution. According to Article 246 of the

Constitution of India, both, the Parliament and State Legislatures can enact laws on

aspects relating to employment, trade unions, industrial disputes, social security etc.

Generally speaking, the State Government is the appropriate authority for

administering Central Laws in most cases.

Different Practices at State Level

Changes in Labour Law/Policy at the State Level

Recognition of Bargaining Agent

Simplified Labour Inspection

New Thrust in Labour Policy

Permissions for Closure, Retrenchment, and Lay-off

Wages



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Limits to the Powers of the State

There is a limit to the role and powers of the state governments. They are duty-bound to refer their enactments and amendments to the Centre for the assent of the

President of India. The Central Government may on its own, or upon being referred

to by the President, tender advice to form the basis for the President's decision. The

usual practice of the President's office is not to act, rather than to turn down the

proposals for changes perse. Some years ago, the Tamil Nadu government raised

the limit of the number of employees required in an establishment for application of

certain Central Legislations (like the Factories Act and the Industrial Disputes Act),

as well as for prior approval for lay-offs, lock-outs and closures. Similarly, it took

many years for Andhra Pradesh to get Presidential approval for its legislations

concerning worker's participation in management and insurance for workers

affected by structural changes. Finally, of course, Andhra Pradesh did not go ahead

with its proposals.

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CH-03 Asjad Sir