Case Study on M/s.

Mass Exports, Chennai

M/s. Mass Exports is one of the leading firms in Chennai. It had 3 partners namely, A, B & C.

Mr. A is the Managing Partner and took active part in the day to day affairs of the business. The

firm exports apparels to countries, like, Italy, France, U.K., Thailand, Malaysia, and Singapore.

It had around 200 employees on its pay-roll. 158 employees are members of registered trade

union of the organization. One of the conditions laid down in the bye-laws of the trade union is

that to become a member of the union, an employee must have put in at least 5 years of

completed service in the organization. 40 employees had less than five years of experience, and

hence, are not part of the union. Normally, the salaries of employees, who are part of union is

much higher than the non-union employees by 30%.

The style of management was autocratic. Union was not consulted even in the matters affecting

employees’ welfare. The office-bearers of the union on their part remained passive in order to be

in the good books of the management and pledged their rights to the management.

Out of 40 non-union employees, 6 employees were highly skilled, sincere and dedicated to their

work and their work culture caught the attention of Mr.A, the Managing partner and decided to

reward those 6 workers as a sign of appreciation and by convincing other partners, increased

their salaries by 30% i.e., to make it on par with the union-employees . This act by the managing

partner was not liked by the other 34 non-union employees, as their salaries remained the same.

Few non-union employees met Mr.A and requested him to increase the salaries for all the 40

employees but their request was turned down. As a last resort, they represented the matter to the

union office-bearers in an informal way, as they are not members of the union. Their main
contention was, “equal pay for equal work”. They further explained that they are frustrated

and it had created a permanent division among non-union employees.

The office –bearers of the union after contemplating for two months over the issue represented

the matter and asked the management to bring in parity in salaries among the same category of

workers. As Mr.B & Mr.C were personally unhappy regarding the increment given to the 6

employees, because it had resulted in more cash outflow. Therefore, as soon as the union

represented the matter, they convinced Mr.A about the consequences and reduced the wages of 6

employees by 30% after paying increased salaries for two months, in order to make it uniform

for all the 40 employees.

As far as the union is concerned, they were happy because, their request was honored by the

employers. Motivated by the success, the union pressurized the management to consult them in

all major policy decisions of the firm and as a consequence the union became more aggressive

and became a hindrance in the process of decision making at M/s. Mass exports.

Analyze the industrial relations climate, especially the role of trade union and record your

views.