ROLE OF TRADE UNIONS IN

BREEDING POOR
INDUSTRIAL RELATIONS

Presented by:
Anoop Kumar
08HR012
WHAT ARE TRADE UNION
 Trade Union definition:
a trade union is an ongoing association of wage
earners with the purpose of maintaining or
improving their working conditions (Webb and
Webb, 1894)  
 Dale Yoder has defined trade union as a
continuing long – term association of employees
formed and maintained for the specific purpose
of advancing and protecting the interests of
members in their working relationships.
 A trade union is a continuous association of
workers which is formed with the purpose of
protecting the interests of workers.”
Phases of Trade Union
 The first phase (1850 to1900)
During this phase the inception of trade unions took place.
During this period, the working and living conditions of the
labor were poor and their working hours were long. Capitalists
were only interested in their productivity and profitability.
 The second phase (1900 to 1946)
This phase was characterized by the development of organized
trade unions and political movements of the working class.
Between 1918 and 1923, many unions came into existence in
the country.
 The third phase began with the emergence of 
independent India (in 1947).
Trade Unions at present in India
 All India Trade Union Congress (AITUC) 
 Bharatiya Mazdoor Sangh (BMS) 
 Centre of Indian Trade Unions (CITU) 
 Hind Mazdoor Kisan Panchayat (HMKP) 
 Hind Mazdoor Sabha (HMS) 
 Indian Federation of Free Trade Unions (IFFTU) 
 Indian National Trade Union Congress (INTUC) 
 National Front of Indian Trade Unions (NFITU) 
 National Labor Organization (NLO) 
 Trade Unions Co-ordination Centre (TUCC) 
 United Trade Union Congress (UTUC) and 
 United Trade Union Congress - Lenin Sarani (UTUC - LS)
Features of trade unions

 It is an organisation formed by employees or workers.

 It is formed on a continuous basis. It is a permanent body and
not a casual or temporary one.
 It is formed to protect and promote all kinds of interests –
economic, political and social-of its members. The dominant
interest with which a union is concerned is, however, economic.
 It includes federations of trade unions also.
 It achieves its objectives through collective action and group
effort.
OBJECTIVES
 Better Wages
 Better Working conditions
 Bonus
 Resist unsuitable schemes
 Secure welfare
 Project Interests of workers
 Social Welfare
 Organisational growth and stability

Functions
 Militant
 Fraternal
Structure of Trade Unions
 Plant level Unions: The first level in the structure from below
is the plant level union. This comprises the unions in one organisation
or factory.
 Local level Federations:This is the second level in the
structure from below. The local trade union federation holds
together the plant level unions at the local level in a particular
craft and industry.
 Regional level federations: These are the organisations
of all the constituent unions in a particular state or region.
 National level federations :These are national level
bodies to which plant level unions, local unions or
regional level unions may get affiliated. These are the
apex bodies at the top of the structure. They act as
coordinating bodies.
Diagramatic representation

 National Level Federations

 Regional Level Federations
 Local Level Federations
 Plant Level Federations
Functions Of Trade Unions

1. Militant Functions
• To achieve higher wages and better working
conditions
• To raise the status of workers as a part of industry
• To protect labors against victimization and injustice
 2. Fraternal Functions
• To take up welfare measures for improving the morale
of workers
• To generate self confidence among workers
• To encourage sincerity and discipline among workers
• To provide opportunities for promotion and growth
• To protect women workers against discrimination
Criticism of Trade Unions by
Employers

•Lack of education
•May not welcome change
•Strike on Illogical basis
•Creation of Artificial scanity of labour
•Undue demands relating to wages
Problems and Weaknesses of Trade
Unions

•Uneven growth
•Limited membership
•Multiplicity of unions
•Outside leadership
•Financial problems
•Indifferent Attitude of workers
Suggestions for Healthy growth of
Unions

•One Union Per Industry

•Paid Union Officials
•Development of Internal Leadership
•Recognition of Trade Unions
•Improved Financial condition
 Problems of Trades Unions.
1. Create Unemployment.
If labour markets are competitive, higher wages will cause unemployment.
Trades unions can cause wages to go above equilibrium through the threat
of strikes e.t.c. However when the wage is above the equilibrium it will
cause a fall in employment.
2. Ignore non Members
Trades unions only consider the needs of its members, they often ignore the
plight of those excluded from the labour markets, e.g. the unemployed.
3. Lost Productivity.
If unions go on strike and work unproductively (work to rule) it can lead to
lost sales and output. Therefore their company may go out of business and
be unable to employ workers at all.
Contd...
 4. Wage Inflation.
If unions become too powerful they can bargain for higher wages, above the rate of
inflation. If this occurs it may contribute to general inflation. Powerful trades unions
were a significant cause of the UK's inflation rate of 27% in 1979
The benefits of trades unions depends on their circumstances. If they face a monopsony
employer they can help counterbalance the employers market power. They can increase
wages without causing unemployment.

If unions become too powerful and they force wages to be too high, then they may cause
unemployment and inflation

It also depends on whether they cooperate with firm or not on increasing productivity.
Industrial Relations

 Industrial relations are the relationships between employees 
and employers within the organizational settings. The field of 
industrial relations looks at the relationship between 
management and workers, particularly groups of workers 
represented by a union. Industrial relations are basically the 
interactions between employers, employees and the 
government, and the institutions and associations through 
which such interactions are mediated. 
Actors in the IR system

 Employers: Employers possess certain rights vis-à-vis labors. They

have the right to hire and fire them. Management can also affect
workers’ interests by exercising their right to relocate, close or merge
the factory or to introduce technological changes.
 Employees: Workers seek to improve the terms and conditions of
their employment. They exchange views with management and voice
their grievances. They also want to share decision making powers of
management. Workers generally unite to form unions against the
management and get support from these
 Government: The central and state government influences 
and regulates industrial relations through laws, rules, 
agreements, awards of court ad the like. It also includes third 
parties and labor and tribunal courts.
Diagramatic representation of IR
System
Management-labor relationship
     Three key factors to be considered in conducting an analysis of the 
management-labor relationship:
 Environmental or external economic, technological,
political, legal and social forces that impact
employment relationships.
 Characteristics and interaction of the key actors in the
employment relationship: labor, management, and
government.
 Rules that are derived from these interactions that
govern the employment relationship.
Objectives of industrial relations system

   To safeguard the interest of labor and management by 
securing the highest level of mutual understanding and good-will 
among all those sections in the industry which participate in the 
process of production.
  To avoid industrial conflict or strife and develop harmonious 
relations, which are an essential factor in the productivity of 
workers and the industrial progress of a country.
   To raise productivity to a higher level in an era of full 
employment by lessening the tendency to high turnover and 
frequency absenteeism.
Objectives
 To establish and promote the growth of an industrial democracy
based on labor partnership in the sharing of profits and of managerial
decisions, so that ban individuals personality may grow its full stature
for the benefit of the industry and of the country as well.
 To eliminate or minimize the number of strikes, lockouts and gheraos
by providing reasonable wages, improved living and working
conditions, said fringe benefits.
 To improve the economic conditions of workers in the existing state
of industrial managements and political government.
 Socialization of industries by making the state itself a major employer
 Vesting of a proprietary interest of the workers in the industries in
which they are employed.
Industrial Disputes

 The number of industrial disputes in country 
has shown slow but steady fall over the past 
ten years. In 1998, the total number of 
disputes was 1097 which fell by more than 
half to 440 in 2006.It is being estimated that 
this trend will continue in 2007 as well
Industrial Disputes
Causes Of Industrial Disputes
 Wages and allowance: In 2002,
21.4% of disputes were caused by
demand of higher wages and allowances.
 Personnel and
retrenchment: The personnel and
retrenchment have also been an
important factor which accounted for
disputes. During the year 2002,
disputes caused by personnel were
14.1% while those caused by
retrenchment and layoffs were 2.2%
and 0.4% respectively.
 Indiscipline and
violence: From the given table, it is
evident that the number of disputes
caused by indiscipline has shown an
increasing trend. In 2002, 29.9% of
disputes were caused because of
indiscipline, which rose up to 36.9% in
2003.
 Bonus: Bonus has always been an important factor in
industrial disputes. 6.7% of the disputes were because of
bonus in 2002 and 2003 as compared to 3.5% and 3.6% in
2004 and 2005 respectively.
 Leave and working hours: Leaves and working hours
have not been so important causes of industrial disputes.
During 2002, 0.5% of the disputes were because of leave
and hours of work while this percentage increased to 1%
in 2003. During 2004, only 0.4% of the disputes were
because of leaves and working hours.
 Miscellaneous: The miscellaneous factors include

- Inter/Intra Union Rivalry

- Charter of Demands
- Work Load
- Standing orders/rules/service conditions/safety
measures
- Non-implementation of agreements and awards etc.
Latest Industrial Disputes

 Jet Airways
 Air India
 Arcelor Mittal
 (search in Detail for above these Or if if u find 
any more cases u can add to it)
Impact of Industrial Disputes
Strikes

 A strike is a very powerful weapon used by 
trade unions and other labor associations to 
get their demands accepted. It generally 
involves quitting of work by a group of 
workers for the purpose of bringing the 
pressure on their employer so that their 
demands get accepted
Lockouts

  Acc to Industrial Disputes Act 1947, lock-out 

means the temporary closing of a place of 
employment or the suspension of work or the refusal 
by an employer to continue to employ any number of 
persons employed by him.
 PICKETING
When workers are dissuaded from work by stationing certain men at the factory
gates, such a step is known as picketing. If picketing does not involve any
violence, it is perfectly legal. Pickets are workers who are on strike that stand at
the entrance to their workplace. It is basically a method of drawing public
attention towards the fact that there is a dispute between the management and
employees.
The purpose of picketing is: 
to stop or persuade workers not to go to work
to tell the public about the strike
to persuade workers to take their union's side
 GHERAO
Gherao in Hindi means to surround. It 
denotes a collective action initiated by a 
group of workers under which members of 
the management are prohibited from leaving 
the industrial establishment premises by 
workers who block the exit gates by forming 
human barricades. 
Analysis Of Strikes and Lockouts
Prohibition of Strikes and Lock-Outs

Employees are prohibited from striking according to the section 22 of Industrial

Disputes Act 1947. Employees, who are working in a public utility service, cannot
go on a strike without giving a notice of strike within the six weeks before
striking.
 Illegal Strikes and Lock-Outs 
A strike or a lock-out is illegal if it is declared in noncompliance with the section 22 
(as defined above) of Industrial Disputes Act 1947, that is, if the notice period is not 
served or if the strike is held within the fourteen days of issuing the notice of strike. If 
a strike or lockout has already taken place and is being referred to a Board, the 
continuance of such a strike or lock out is not illegal provided it is in compliance with 
the provisions of act. 
 Penalty for Illegal Strikes and Lock-outs
A workman who is involved in an illegal strike can be penalized with imprisonment 
for a term extendable to a month or with a fine or fifty rupees or both. In similar way, 
an employer who initiates and continues a lockout is punishable with imprisonment 
extendable to a month or with a fine of one thousand rupees or both
 Collective Bargaining

 Collective bargaining is process of 
joint decision making and basically 
represents a democratic way of life 
in industry
 ILO has defined collective bargaining as,
negotiation about working conditions
and terms of employment between an
employer and a group of employees or
one or more employee, organization
with a view to reaching an agreement
wherein the terms serve as a code of
defining the rights and obligations of
each party in their employment/
industrial relations with one another
collective bargaining:

 It is a collective process in which representatives of 
both the management and employees participate. 
 It is a continuous process which aims at establishing 
stable relationships between the parties involved. 
 It not only involves the bargaining agreement, but 
also involves the implementation of such an 
agreement. 
 It attempts in achieving discipline in the industry 
 Itis a flexible approach, as the parties involved have 
to adopt a flexible attitude towards negotiations.
The collective bargaining process

 Prepare
 Discuss
 Propose
 Bargain
 Settlement
Measures For Improving Industrial
Relations

 Strong and Stable Union

 Mutual Trust
 Workers’ Participation in Management
 Mutual Accommodation
 Sincere Implementation of Agreements
 Sound Personnel Policies
 Government’s Role
 Progressive Outlook
Healthy industrial relations

  Uninterrupted production 
  Reduction in Industrial Disputes
 ·  High morale 
 Mental Revolution 
 Reduced Wastage