5.

Trade Unions as Actors

in the HRM system:
Debi S. Saini
Professor of HRM
Management Development Institute, Gurgaon

Trade Unions as actors in HRM System

Objectives 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 todays era
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Meaning and Nature

of
Trade Unionism

Meaning of Trade Unions

Nature
Unions: A major component (actor) of IRS

Meaning:
An organization
formed by employees
to 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

Union Goals and Philosophy

Business Unionism

Social (Reform) Unionism

Practice of unions
seeking to improve
the wages, hours,
and working
conditions
in a businesslike
manner

A characteristic of
unions seeking to further
members interests by
influencing the social,
economic, and legal
policies of
governments

Union Structure and Function

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

Industrial Unions
Includes the unskilled

and semiskilled workers

at a particular location

Craft Unions
Composed of workers who

possess the same skills or

trade

National/Intl. Unions
Many local unions are part
of a larger national or
international union
(e.g. ICFTU)
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Trade Unions Act 1926

Trade Union under TUA: Definition

2 (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 includes
any federation of 2 or more TUs:

T U Act 1926: Components

The Act consists of 33 sections: Deals with these:
Regis.Rights/liab.RegulationsPenalties/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 1926

1. 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 stateprocedure 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 1926

2 (h) Trade Union means
any 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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Role
of
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 Functions

Exercise of Power: Key Function
A TU is first & foremost
a 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 Unions Power

TUs power in labour movement, depends on:
Its SizeLeadership qualityAlliance between unions

TUs power towards Govt.:

Depends on Govts desire to support

Its power towards employers depends on:

Union densityEconomic, technological, political factors

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Union Power used for Various functions

1. 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 servicesWM Educationorganizationinformation

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

Gandhis satyagraha: Ahmedabad in 1917:

50% wage hike demanded: RejectionStrike
Gandhiji said: 35% fairWM 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 Unions

1. Low union participation & lack of interest
2.

Poor earnings and lack of leisure time

3.

Political parties' attempt to widen base

4.

WMs 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 Substitution
In 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

States covert primacy to productivity
Unitarist/individualized IR: gold-collar WM
Declining employmentautomation
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 ILOs raison detre

ILOs 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
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