Evolution of Industrial Relations Through the Ages

Evolution of Industrial Relations
Learning Objectives
To understand
the historical perspective of Industrial

Relations in India.
the union comparison across countries.

Structure
2.1 Introduction
2.2 Industrial Relations in India
2.3 Union Comparisons Across Countries
2.4 Summary
2.1 Introduction
Unique type of employer-employee relationship has

been brought forth by ever growing and fast
changing scientific , technological development,
industrial production techniques and ideological
values.
This new relationship has replaced the traditional
master –servant relationship.
Historical review of industrial relations in a few
countries is required for their proper theoretical
perspective.
Ancient literature throws light on India’s advances

in the fields of commerce & industry. Several
artisans & workers were engaged in maintaining
peaceful relations between capital & labour.
They understood benefits of being united & formed
shreni or guild to manage their affairs.
During Mughal rule such organizations were not
there & as a result workers were entirely dependent on
their employers who forced them for work.
Phase 01 : From 1850s to the end of the 1st World war
the British Government enacted several legislative
measures. They aimed at minimizing competitive
advantage of local employers against British
employers.
The 1st World war brought about labour unrest as
wages were not keeping pace with either rising prices
or growing aspirations.
Central & Provincial Legislatures initiated social
legislation and started a new phase of industrial
relations .
Establishment of International Labour Organization

in 1919 and formation of All India Trade Union
Congress in 1920 were significant events in the
history of industrial relations.
Phase 02 : The policy after the war related to
improvement in the working conditions & provision
of social security benefits.
Trades Disputes Act 1929 sought to provide a
conciliation machinery to bring about peaceful
settlements of disputes.
2nd World War forced the Government to

maintain an adequately contended work force to
maximize production to support the war. Appropriate
labour policy was shaped by bringing all the
interests together at a common forum.
Expressing its faith in ILO philosophy,
tripartite consultative system was initiated in India.
Gradually, tri-partism developed into a full-fledged
system, a kind of parliament for labour and
management.
At the national level it aimed at ;
i] promotion of uniformity in labour

legislation;
ii] laying down a procedure for settlement of
industrial disputes;
iii] discussion of all matters between employer
& employees.
The positive action of this new tripartite
arrangement was in the four areas
i] discussions on proposed legislation /
amendments among interested parties to arrive
at consensus ;
ii] setting up normative guidelines for
resolving labour management disputes;
iii] codification of their rights & duties through
mutual agreement;
iv] advising the Government on ratification of
ILO conventions
Indian Labour Conference [ILC] & Standing

labour Committee [SLC] formed in 1940s facilitated
enactment for minimum wages, tripartite industrial
committees, health insurance , provident fund.
Voluntary schemes were also adopted for
workers’ participation in management & workers’
education.
Criticism is voiced over tripartite system as
consensus of the parties was superficial & real issues
were side tracked.
Phase 03 : Post Independence industrial relations

policy sought peace in industry & fair deal to
workers.
Towards this objective appropriate labour legislation,
labour administration & industrial adjudication were
planned by the state.
However, growing spirit of litigation, & delays
attendant on legal processes resulted in wide spread
dissatisfaction.

The new Constitution of India laid down a labour
policy that planned
to prevent exploitation of the weaker section,
to ensure fair distribution of national income,
to provide social security in times of need,
to develop harmony & community of interests
between workers & management with the
objective of building a cooperative structure
based on mutuality of interest.
The approach to labour problems in the First Five Year

Plan related on one hand to “ the requirements of the
well being of the working class “ and on the to “ its
vital contribution to the economic stability & progress
of the country
Subsequent Plans lay emphasis on
harmonious relations between capital & labour
increasing share for labour in working of
industry
Subsequent Plans lay emphasis on [contd.]
trade unions as a part & parcel of the industrial

system.
preventive measures for industrial peace
promoting productivity for employees &
community
satisfying workers’ urge for self expression
strong works committees
training programmes for labour officers
Subsequent Plans lay emphasis on [contd.]
settlement of disputes through

mediation, conciliation, arbitration &
adjudication.
improvement in capacity utilization
maximizing employment generation
tackling industrial sickness
rehabilitation of displaced workers
labour participation in management
etc etc.

While the basic contents of the industrial relations
policy practically remained unaltered, the emphasis,
based on social, economic & political factors, changed
to
laissez-faire policy
protective labour legislation
paternal administration
active intervention treating industrial
relations as law & order issue
control over entire labour field.
2.3 Union comparison across countries
Unions find various degrees of strength across

countries.
Most unionized group in each country is that of
government employees, followed by private blue
collared workers.
White collared private sector employees are least
unionized.
Bargaining systems vary from country to country.

Britain has private associations with least restraint

from the Government. Craft unions predominate and
agreements relate to minimum wages, have
indefinite tenor and are silent on grievance redress.
In Germany, collective bargaining focuses on wages

& hours of work. Industry wise agreements are
applicable to all firms in the industry, unless
employer / employee have a separate agreement.
Japanese labour system is based on

lifetime employment for regular workers
seniority based wage system
enterprise unions.
In Japan, considerable loyalty exists for company.
Workers work with devotion, are offered job rotation,
enjoy distinct structure of wages & promotions, have
opportunity to mingle with supervisors both in and
outside the place of work as a part of their culture.
Evolution of Industrial Relation
2.4 Summary
Industrial system has brought about many
complexities which have rendered the management of
people in an enterprise more difficult .
Traditional industrial relations is gradually giving

place to modern industrial relations posing a variety
of problems for workers and managers.
2.4 Summary
Obviously the industrial relations scene in different

countries have shown different characteristics &
trends signifying dynamic relationship between the
parties.
The forces of change are operating with such

intensity & velocity that it is indeed very difficult to
predict the future , more so now than before.
The End!
In the next session we cover chapter three on
“ Grievance Function in
Industrial Relations.”
ZÉÉw _âv~4

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Evolution of Industrial Relations

the historical perspective of Industrial

the union comparison across countries.

Unique type of employer-employee relationship has

2.2 Industrial Relations in India

Ancient literature throws light on India’s advances

2.2 Industrial Relations in India

Establishment of International Labour Organization

2nd World War forced the Government to

2.2 Industrial Relations in India

At the national level it aimed at ;

i] promotion of uniformity in labour

Indian Labour Conference [ILC] & Standing

2.2 Industrial Relations in India

Phase 03 : Post Independence industrial relations

2.2 Industrial Relations in India

2.2 Industrial Relations in India

The approach to labour problems in the First Five Year

Subsequent Plans lay emphasis on [contd.]

trade unions as a part & parcel of the industrial

Subsequent Plans lay emphasis on [contd.]

settlement of disputes through

2.2 Industrial Relations in India

2.3 Union comparison across countries

Unions find various degrees of strength across

Bargaining systems vary from country to country.

2.3 Union comparison across countries

Britain has private associations with least restraint

In Germany, collective bargaining focuses on wages

2.3 Union comparison across countries

Japanese labour system is based on

Traditional industrial relations is gradually giving

Obviously the industrial relations scene in different

The forces of change are operating with such

In the next session we cover chapter three on

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