Priya Pathriya

MBA IV SEM.

Industrial Relations and Labor Laws

Assignment
Q1. Outline the factors affecting the Industrial relations.
Individual Behaviour
Every person has a different perception, background, skills, knowledge, experience and
achievements which influences an individual’s behaviour. The employees, therefore, behave
differently in different situations, thus impacting the work environment in the organization.
Organizational Structure
The hierarchical structure creates more formal relationships among the employees belonging
to different hierarchical levels in an organization. Also, the delegation and execution of
decision-making power by the superior influences the industrial relations between the
managers and the employees.
Psychological Factors
An employee’s attitude and mentality towards the employer and the given task; and the
employer’s psychology towards the workers can be positive or negative, which ultimately
impacts the employee-employer relationship.
Leadership Style
Every manager possesses certain leadership traits and different style to function even in a
formal organization. Through his/her formal or informal ways of generating team spirit and
motivating the employees, he/she impacts the organization’s industrial relations.
Economic and Technical Environment
To cope up with the changes in the economic conditions or technology, organizations need to
restructure the task of the employees including their work duration, conditions and wages;
which leads to a difference in their behaviour, attitude, adapting spirit, etc. towards the
organization and its people.
Legal and Political Environment
The legal framework and political circumstances influence the organization and its industrial
relations. It contributes to the framing of rules, rights, authority, powers, roles and
responsibilities of all the parties of the organization.
Institutional Factors 
State Policy: These are the rules that the state goes by, which are set by the government of the
country. Labour Laws: These are the laws regulating labour in India. Labour law or
employment law mediates the relationship between workers(employees), employers, trade .
unions and government. 
Voluntary Codes: Specific standards of conduct for an industry including how to deal with
the workers and other individuals. Collective Bargaining Agreements: These agreements
allow organized group of workers and management to negotiate wages. Labour Unions:
Also known as trade unions, is an organization whose membership consists of workers and
union leaders , united to protect and promote their common interest.  Employer’s
Federation Of India (EFI,1933): An association of autonomous organizations of industry and
was set up with the purpose of protecting, promoting the interests of employers in the area of
Industrial relations, labour problems.
Economic Factors
Economics forces are the factors that help to determine the competitiveness of the
environment in which the industry operates. The economic factors include the level of
unemployment in an industry, the government changes taking place.  Socialist, capitalist
and communist type of ownership: In socialist,there is public and private ownership, in
capitalist-there is private ownership and in communist there is public ownership. Company:
Domestic,MNC,government. Level of Unemployment: It means the percentage of total
workforce who are unemployed and are looking for a paid job. Economic Cycle: It also
refers to as the business cycle which includes various phases: Boom, Slowdown, Recession,
and Recovery.
Social Factors 
It includes items like social groups (caste or joint family). Social Values and norms: These
explain the way in which social processes operate in a given society.  Social status: High or
low.  Influenced industrial relations in the early stages of industrialization gave rise to
relationship as master and servant, haves and have-nots , high and low caste.
Technological Factors
It includes: Work Methods. Type of Technology used. Rate of technological change.
Research & Development Activities ability to cope with emerging trends. “ The
technological factors influence the patterns of Industrial relations and have a direct influence
on employment status, wage level, collective bargaining process in an organization”
Enterprise-Related Factors  It includes the issues like style of management prevailing in
the enterprise. Organizational climate which refers to the business environment in which a
business is operating.  Extent of competition. Adaptability to change and various human
resource management policies.
Global Factors
The various issues included are: International Relations: It refers to the study of
relationships among countries. Global Conflicts. Economic and trading policies.
International trade agreements and relations. Role of International Labour Organization: It
has a significant role to play in bringing companies, trade unions and government together to
bring about improvements to working conditions.
Q2. Define the meaning and importance of collective bargaining.

Collective bargaining is a process of negotiating between management and workers

represented by their representatives for determining mutually agreed terms and conditions of

work which protect the interest of both workers and the management. According to Dale

Yoder’, “Collective bargaining is essentially a process in which employees act as a group in

seeking to shape conditions and relationships in their employment”.

Michael J. Jucious has defined collective bargaining as “a process by which employers, on

the one hand, and representatives of employees, on the other, attempt to arrive at agreements

covering the conditions under which employees will contribute and be compensated for their

services”.

Thus, collective bargaining can simplify be defined as an agreement collectively arrived at by

the representatives of the employees and the employers. By collective bargaining we mean

the ‘good faith bargaining’. It means that proposals are matched with counter proposals and

that both parties make every reasonable effort to arrive at an agreement’ It does not mean

either party is compelled to agree to a proposal. Nor does it require that either party make any

specific concessions.

Why is it called collective bargaining? It is called “collective” because both the employer and

the employee act collectively and not individually in arriving at an agreement. It is known as

‘bargaining’ because the process of reaching an agreement involves proposals and counter

proposals, offers and counter offers.

Importance:

The need for and importance of collective bargaining is felt due to the advantages it offers to

an organisation.

1. Collective bargaining develops better understanding between the employer and the

employees:
 It provides a platform to the management and the employees to be at par on negotiation table.

As such, while the management gains a better and deep insight into the problems and the

aspirations of die employees, on the one hand, die employees do also become better informed

about the organisational problems and limitations, on the other. This, in turn, develops better

understanding between the two parties.

2. It promotes industrial democracy:

Both the employer and the employees who best know their problems, participate in the

negotiation process. Such participation breeds the democratic process in the organisation.

3. It benefits the both-employer and employees:

The negotiation arrived at is acceptable to both parties—the employer and the employees.

4. It is adjustable to the changing conditions:

A dynamic environment leads to changes in employment conditions. This requires changes in

organisational processes to match with the changed conditions. Among other alternatives

available, collective bargaining is found as a better approach to bring changes more amicably.

5. It facilitates the speedy implementation of decisions arrived at collective negotiation:

The direct participation of both parties—the employer and the employees—in collective

decision making process provides an in-built mechanism for speedy implementation of

decisions arrived at collective bargaining.

Q3. What are Industrial conflicts? Why do they take place and what can be done to
resolve them amicably to restore harmony at workplace.
Ans. Industrial conflict occurs when employees express their dissatisfaction with management
over the current state of the management-employee relationship. The causes of such
dissatisfaction are typically matters related to regular wage payment, wage increase or
remunerations according to terms of the employment contract.
The causes of industrial disputes are many and varied.

1. Wage Demands - The demand for wages has never been fully met because of inflation and
high cost of living. High inflation results in increased cost of living resulting in never-ending
demands from unions.
2. Union Rivalry -Multiplicity of unions leads to inter-union rivalries. If one union agrees to a
wage settlement, another union will oppose it. The consequence is never-ending disputes, as
has been happening at the Singareni Collieries.

3. Political Interference - Major trade unions are affiliated to political parties. Political
affiliation is not peculiar to our country alone. Even a cursory assessment of labour
movements around the world would show that trade unions are, by their very nature,
political, and that politicisation of labour is the rule rather than the exception.

4. Multiplicity of Labour Laws - Labour laws in our country, as in several other countries,
have been enacted to create conditions for the protection of labour from unfair employment
practices and to provide a legal framework within which Industrial Relations is to be
regulated.

Measures for Industrial Peace:

1. Enactment of the Factories Act, 1948 and other labour laws for regulating conditions of work
in factories.
2. Introduction of schemes like profit sharing, workers participation in management, subsidized
industrial housing etc.
3. Framing of Industrial Employment, (Standing Orders) Act, 1948 for defining conditions of
employment and for framing model service rules.
4. Introduction of bonus scheme making it compulsory for all establishment to pay a minimum
of 8.33 per cent bonus to all employees under the Payments of Bonus Act, 1965.
5. Arrangement for settlement of industrial disputes under the Industrial Disputes Act, 1947.

Q4. Discuss the provisions regarding strikes, lockouts, layout, and retrenchments
under the Industrial Dispute Act.

Layoffs:
Essentially, a lay-off is a condition where the employers are constrained to deny work to their
workforce owing to conditions that bring forth a temporary inability to keep their business going.
The said case scenario can happen only in a continuing establishment.

Special Provisions: The employer cannot, without prior permission from the appropriate
government, lay-off an employee featuring on the muster rolls of the establishment A copy of the
said application has to be given to the concerned workmen as well. If the lay-off happened where
the workmen (other than badli workmen or casual workmen) of an industrial establishment, being a
mine, owing to reasons of fire, flood or excess of inflammable gas or explosion, the employer, in
relation to such establishment, shall, within a period of thirty days from the date of commencement
of such lay-off, apply in the prescribed manner, to the appropriate Government or the specified
authority for permission to continue the lay-off. 

Strike:-
Strike action, also called labour strike, on strike, greve (of French: grève), or simply strike, is a
work stoppage caused by the mass refusal of employees to work. A strike usually takes place in
response to employee grievances. Strikes became important during the industrial revolution, when
mass labour became important in factories and mines. In most countries, they were quickly made
illegal, as factory owners had far more political power than workers. Most western countries
partially legalized striking in the late 19th or early 20th centuries.
Lock-out :
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;
The essential requirements of lockout are:-

1. There should be some demand for which industrial establishment is locked out.
2. The temporary closing of a place of employment/undertaking. The permanent closure
does not constitute lockout.
3. Intention to re-open or take the worker back if they accept the demand must exist.

Retrenchments:

The Act defines “Retrenchment” as the termination by the employer of the services of a workman
for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action,
but doesn't include-

(a) Voluntary retirement of the workman; or

(b) Retirement of the workman on reaching the age of superannuation if the contract of
employment between the employer and the workman concerned contains a stipulation in that
behalf; or Termination of the service of the workman as a result of the on-renewal of the contract
of employment between the employer and the workman concerned on its expiry or of such contract
being terminated under a stipulation in that behalf contained therein; or
(c) Termination of the service of a workman on the ground of continued ill-health;

Special Provisions: It is pertinent to note that a worker who has served for at least a year of
continuous service cannot be retrenched unless served a notice three months in advance and prior
permission from the appropriate government. The said application has to be submitted by the
employer along with the reasons for such retrenchment. The said application will be taken into
consideration and scrutinized through an inquiry. They shall provide an opportunity to be heard for
both sides and may decide on the outcome of the application for reasons recorded in writing. If
there’s no reply from the appropriate government for a period of sixty days from the date of
application, the permission shall be deemed to have been granted.