Industrial Relations

and
Technological Change
Contents
 Industrial Relations

 Concept of Technological Change

 Rationalization and Automation

 Implementation and Progress of Rationalization and

Automation in India

 Automation at LIC (1963)

 Impact of Technological Change

 Appropriate technology
Industrial Relations

 The relation between an employee and an employer

in the course of running of an industry and may
project itself to spheres which may transgress to the
areas of quality control, marketing, price fixation and
disposition of profits among others.

 Industrial Relations or Labour relations, is an

expression used not only for relationships between
employers and Trade Unions, but also for those
involving Government with the aim of defining
policies, facing labour problems.
Concept of Technological Change
 Technology is an instrument of development.
 Affects various aspects of economic and social
life.

 Types of Technological Changes-

Scientific Change in shift in change in Automation

Management location product machinery
Or time and of plants demand
Motion studies
Rationalisation & Automation

 Rationalisation implies a basic change in the

structure and control of industrial activities. Its
techniques can be applied to methods, material and
men.

 In Automation, technology itself controls the

operations. The machine provides data from its
operations and feeds it back to its own controls
which governs the production process.
Implementation of Rationalisation and
Automation in India
 Influenced by American Model
 To Increase productive efficiency
 Vast surplus of Labour after II World War

 Safeguards by Labour Ministry and Planning Commission-

-Fixing the work load
-Stopping fresh Recruitment
-Offering higher wages
-Voluntary Retirement
-Sharing of gains

 Second Five year plan- Rationalization was to be attempted only

when it did not lead to unemployment.
 Progress of Rationalisation and
Automation in India

3 industries- Cotton-textile, Jute and Coal

 Cotton-textile- Workers accepted it.
- Introduced in the form of efficiency measures.
-Additional strain & Inadequate increase in earnings.

 Jute- International Competition

- Progress slow, Dependence on foreign country for Raw Material

 Coal- Rationalization in larger mines, old methods in small mines

Automation at LIC (1963)
 Central trade union
organization opposed it.
 Loss of employment and
addition to cost.
 Management argued-
accelerated industrialization,
increased productivity,
raised standard of living.
 In order to bring
reconciliation- meeting of
Standing Labour Committee
to consider the impact of
automation and remedial
measures.
 There was underutilization
of computers because they
were introduced without
adequate preparation,
planning and thought.
Cont….

 The question of installation of computers in

these established industries were to be
governed by two criteria, namely:
1)The effect on employment in relation to the
whole economy
2)The effect on employment in the relevant
departments of these establishments.
Impact of Technological Change
NEGATIVE IMPACT POSITIVE IMPACT
 Impact on employment  Labour saving
 Redundancy  Improves level of earnings
 Occupational Adjustment  Higher productivity
 Allocation of gains  Reduction in cost and increase in
 Transfer & Retraining Problems benefits
 Resistance to change- Strikes,  Product standardization
Absenteeism, resignations etc.
 Job Satisfaction
 Worker & Union Reations
 Changes in job content thereby
creating new jobs to replace old
ones
 Fitting new jobs into the existing
incentive scheme
Appropriate Technology: Its
relevance to the Indian Context
 The kind of technology which would be found
appropriate to the conditions found in the country
where it was being introduced.

 Less developed countries do not possess requisite

labour skills to replace the machine skills, technical
know how and infrastructure.

 Example- The solar pump developed by a French

firm which is being used in Mexico.
CONCLUSION

 Thus, one must not only examine very

carefully the cost benefit analysis from the
economic point of view but also take into
account the repercussions on industrial
relations.