08 Chapter 4

Chapter 4
HUMAN RESOURCE MANAGEMENT IN

BHARAT HEAVY ELECTRICALS LIMITED
4.1 History of BHEL
After attaining the freedom in 1947, one of the greatest challenges before the
Government of India was to provide a strong base in infrastructure and capital goods
for the development of economy. Under the leadership of Prime Minister, Pt.
Jawaharlal Nehru, the government realized that there should be a broad manufacturing
base and adequate technically qualified people for sustained economic growth.
It has been recognized that adequate supply of electric power is a precondition for
long term economic and industrial growth. The Planning Commission recommended
initiating steps regarding setting up a factory for the manufacture of almost all types
of heavy electrical equipment required for various development projects. As a result,
the Indian Government signed an agreement on 17th November, 1955, for the
establishment of a factory at Bhopal with Associated Electrical Industries (AEI), UK.
This completed in all respects for the manufacturing of heavy electrical equipment in
India. The company was registered as Heavy Electricals (India) Limited in the Public
Sector under the Ministry of Industry and Commerce dated 29th August, 19561.
Considerable increase in demand for mainly power generating capacity was expected
in Five Year Plans by the Government of India, with the resolve to thrust the installed
capacity in the country for the generation of power up to 1,00,000 MW by the turn of
the century. Further, the Indian Government took decision to set up three more plants
for the manufacturing of heavy electrical equipment.
The first one was at Tiruchirappalli, Tamil Nadu for the manufacturing of high
pressure boilers, the second one was at Hyderabad, Telangana for the manufacturing
of steam turbo generators, high pressure pumps and compressors. Both of these were
with collaboration from Czechoslovakia. The third plant was at Haridwar,
1 Annual Report of BHEL, 2012-13

Human Resource Management in Bharat Heavy Electricals Limited
Uttarakhand with erstwhile collaboration from USSR for the manufacturing of large
steam turbo generating sets as well as motors and also hydro generating sets along
with turbines and generators.
These three newly conceived projects were the part of Heavy Electricals (India)
Limited and the work for them was initiated at Bhopal. Upto November 1964, all the
initial preparatory work was carried out from Bhopal. The Government decided to
establish a separate corporation for setting-up and management of these three
units. Consequently, Bharat Heavy Electricals Limited (BHEL) was born and
formally incorporated on 13th November, 1964.
The three new plants went into the task of production in the latter half of the 60’s,
focusing on power generating equipment, apart from the the Bhopal plant, which had
already been indulged in the manufacturing of thermal and hydro generator plants on
customer orders from Electricity Boards.
The plants under BHEL have also made rapid progress. Although, there was
considerable overlap as also complementarities in the production profile and adopted
technologies of the two corporations. There was an urgent need for rationalization of
product profile, design standardization and engineering practices. Integration of the
corporations results in synergy and optimal use of resources of the enterprises.
The merged entity was better able to stand in growing global competition. After long
deliberations, Government of India in 1972, decided to create a truly modern global
enterprise through the merge the operations of the two corporations and accordingly,
HE(I)L and BHEL formally merged in January 1974.
4.2 Decade-Wise Growth of BHEL

The BHEL has got enormous growth from its origin to till date. Its growth and
achievements can be studied decades wise as follows:
4.2.1 1970’s: Era of Strategic Planning and Management
The merged entity, BHEL upgraded its facilities for the manufacturing of thermal
generating sets of individual capacities ranging from 30 MW to 210 MW and hydro
generating plants of various ratings as well as transmission products up to 400 KV
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ratings. It began transforming itself from the phase of production or operations

management to the phase of strategic planning and management. BHEL reached a
turnover level of Rs. 230 crore with its team of 45,000 highly trained and widely
experienced technicians and engineers, by the year 1973-74. By end of Fourth Plan
(the mid-seventies), the company contributed 910 MW of power generating
equipment to India's capacity of 4,579 MW. To meet changing domestic needs and
exports, BHEL upgraded its products in association with leaders of global reputation.
During this period, BHEL embarked on its overseas journey and executed the first
export order for Malaysia.
In the early years, BHEL realized that the future growth could only come by
providing total service to customers by developing strong system of integration and
service capability. The integration of the two corporations created competitive
engineering enterprise to meet stronger future challenges. Equal importance was
given to the creation of in-house visioning and long-term planning capability to meet
technology and rapid change in market. After consultations with the stakeholders and
benchmarking with globally leading companies, it brought-out a Corporate Plan in
March 1974. This resulted in galvanization of the organization for rapid growth and
development and laid the foundation for creating a global enterprise in true scenes.
This was a landmark in the corporate history of India.
As mentioned in the Corporate Plan of transformation of BHEL from "Production

Orientation" to "Engineering, Development and Market Orientation", the strategic
initiatives were implemented in BHEL. It emphasized on the strategy of functional
orientation, product rationalization and standardization, establishment of R&D
department, vertical integration, system sales, business expansion by the mean of
acquisition, focus on exports and strengthening customer service.
Further, the second-generation manufacturing units as Transformer Factory was set up

at Jhansi, Central Foundry Forge Plant at Haridwar. Similarly, Seamless Steel Tube
Plant at Tiruchirappalli was established to meet the objective of expansion as well as
vertical integration. After that, diversification was achieved in 70's with the
acquisition of Radio and Electrical Manufacturing Company (REMCO) in Electronics
Division to give fillip to the control electronics business. To ensure supplies of
[113]
BHEL generating and transmission equipment including nuclear power generating

plants, industries and Railways, various important steps were initiated and taken with
the formation of an Engineering Committee with the motto to rationalize the
engineering procedures and to result in a unified design for all products under the
banner of BHEL.
In the mid of the decade, BHEL had also planned for the manufacturing of higher
voltage equipment for transmission of power and increased ratings of generation
equipment in keeping view of global trends. One more important step was then taken
for collaboration with Kraftwerke Union (KWU) of Germany in 1974-75 for the
design and technology for thermal generating sets of above 210 MW and up to 1,000
MW. Through the setting up of Corporate Research and Development (CRD) division
with a chain of laboratories at Hyderabad and with scientists and highly qualified
staff, improvements had continuously been made in designs which suit local
conditions to enable satisfactory operation of all major equipment.
BHEL rose to the occasion by developing steam generators for nuclear power projects
on its own. Another example of rising of the company to the critical needs of the
country was at the time of critical situations of Oil Shock in 70’s. During this
situation, the company organized quickly for the production of oil field equipment.
One of the important productions was on-shore oil rigs for ONGC's exploration
programmes.
By the end of 1970's, systems concept had taken a deep roots and BHEL was
providing total services with the concept to commissioning to all the customers.
During the first two decades, the company had made substantial investments to meet
the needs of technicians and competent engineers. By 1970's, it was recognized that
nurturing of managerial talent and future leaders within the organization become
imperative. The corporate plan also helped in addressing this need. This resulted as
the source for budding leaders in many public as well as private sector enterprises in
India.
4.2.2 1980’s: Era of Market Orientation and Technological Advances
The decade of 1980 was a phase of market orientation and to face the increased
[114]
overseas competition resulting from the resource constraints for power projects within
the country. BHEL's operations were reorganized around business sectors as well as
in various regions. The concept of Product Manager was introduced to tackle
increased accountability and responsibility for an integrated approach pertaining to
maintaining all round growth. Stress was taken for the commercialization of in-house
technologies and entry into new potential growth such as gas turbines, locomotives
and fluidized bed combustion boilers etc.
By the mid-eighties, next generation of manufacturing units were added in the form of
four smaller plants, for manufacturing of ceramic insulators at Jagdishpur, industrial
valves at Goindwal, boiler auxiliaries at Ranipet, and non-conventional energy source
(NCES) products at Rudrapur. Mysore Porcelains Limited (MPL) in Bangalore was
merged with BHEL and became the company’s Electro Porcelains Division, for
manufacturing of insulator and ceramic liners.
BHEL’s continuing thrust on technology absorption as well as assimilation resulted in

speedy stabilization of 210 MW thermal sets, introduced in 1977 for the first time in
Indian power systems. By mid of 1980's, BHEL started supplying 500 MW thermal
power equipment and established itself as a premier public sector organization within
the country. This had been made possible through the learning mainly from various
stakeholders especially customers and through regular feedback on power plants. The
company had developed strengths in engineering and manufacturing areas for the
production and supply of equipment of any specification and complexity. BHEL
accepted the significance of owning intellectual property as well as technology to
compete and be maintained in the global area.
4.2.3 1990’s: Era of Resurgence, Ideation and Innovation
During this decade, the business environment was undergoing a major transformation
which was became imperative with the conquest of economic liberalization and
lowering down of trade barriers in the regime of WTO. This had forced the BHEL to
meet the increased expectations of all stakeholders. The global changes in economic
and trade policies have brought into sharper focus on the immense potential of the
strategic moves that the company had already initiated. Most significant among these
were enhancing international competitiveness with the up gradation of technology,
[115]
developing in-house capability for the manufacturing of key production inputs,

comparatively more emphasis on exports, and introduction of new product as well as
business areas.
BHEL was enabled to respond to the challenges by the technique of reorganizing and
strengthening of marketing and capabilities of project execution only due to the sound
Corporate Plan for 90's. It became the only organization of its type in the country,
which had demonstrated its international competitiveness by bagging all the power
plant orders in the domestic market. The company also emphasized on the concept of
selective financing services to meet their customers’ requirements.
During 1990’s new growth areas were also identified as defence, telecom, large gas
turbines and 3-phase AC locomotives. The effort of R&D has always been improved
in BHEL's competitive edge. BHEL entered the fields of wind energy, the frontier
technology of superconductivity and HVDC power transmission. In the transportation
sector, it developed a 40-seater battery powered passenger bus.
It was the era of 1990’s decade when, BHEL became the first public sector company
to obtain ISO 9000 and ISO 14000 accreditations. This geared the company to enter
the next century as a Y2K-ready enterprise.
4.2.4 The New Millennium: Era of Competence Building
In 2000s, India felt major acceleration in economic growth. India's growth rate at ~8%
CAGR was much higher than the same of previous phases when it was 3-4% from
1950s to the early 1980s, and 5-6% from early 1980s to until early 2000s. During the
time, an ambitious programme of ensuring 'Power for all by 2012' was embarked
which resulted into aggressive push for generation capacity addition, rural
electrification and expansion of T&D network. Consequently, electricity sector
witnessed a lot of vivacity and actions from all fronts with the offer of once-in-a-
lifetime growth opportunities for all stakeholders
BHEL focused on manufacturing capacity expansion, innovation, as well as

manpower augmentation to capitalize opportunities as identified in its fifth strategic
plan 'Strategic Plan 2007' applicable for 2002-07. The company continued to be
concentrated on these strategies in addition to focus on exports and spares as well as
[116]
services business in 'Strategic Plan 2012'. The Manufacturing capacity of BHEL was
progressively augmented from 6,000 MW to 20,000 MW. Some units were set up at
Jagdishpur for manufacture of stampings for electrical equipments and transformers
and for power plant piping systems at Thirumayam.
Apart from the above, Bharat Heavy Plates and Vessels (BHPV) at Visakhapatnam
was merged with BHEL and became the 17th manufacturing unit, Heavy Plates and
Vessels Plant. More than 20,000 personnel were recruited during 2007-12 and
manpower reached to around 50,000 as of March 2012. To face the natural resource
scarcity and climate change compulsions, it forged technology collaboration
agreements with Alstom of USA and Siemens of Germany for bringing energy and
fuel efficient technology to India. BHEL identified innovation as the key strategy to
stay in competitive market. In addition to spending more than Rs 1,000 crore on R&D
in 2012, in-house developed products, it contributed almost 20% to the top line. On
the other hand, various strategies with focus on cost, increased performance of
equipments and fast delivery were adopted to counter cheap the imports as well as
emerging domestic competition.
4.2.5 Today: Creating BHEL of Tomorrow: Responsive, Robust and Rising
Today India’s economy is on the cusp with higher growth. The new era definitely will
present new growth opportunities however, the landscape of technology and
competition is still under transformation. BHEL too is transforming itself and has
embarked upon a journey having a vision of “Creating BHEL of Tomorrow”–an
organization that will be Responsive, Robust and Rising, to the needs of the
customers, shareholders, employees and society2.
Leveraging BHEL’s glorious past, enviable strengths as well as contribution towards

nation building, it has put together a series of initiatives strongly focusing on
sustaining growth and considerable profit, asserting leadership in core sectors,
developing people, enhancing digitalization and building potentials in new as well as
diversified businesses and technologies for sustained growth of the economy.
2 ibid. p. 27
[117]
4.3 Vision of BHEL
“A global engineering enterprise providing solutions for a better tomorrow.”3
4.4 Mission of BHEL

“Providing sustainable business solutions in the fields of Energy, Industry &
Infrastructure.”4
4.5 Location of Corporate Office of BHEL
Bharat Heavy Electricals Limited, BHEL House, Siri Fort, New Delhi-110049
4.6 Contact Detail of Some Corporate Leaders of BHEL5
4.6.1 Chairman & Managing Director
Dr. Nalin Shinghal
Chairman & Managing Director
Bharat Heavy Electricals Limited,

BHEL House,
Siri Fort, New Delhi-110049
Ph. No. 011-26001001
Email ID: nalinshinghal@bhel.in
4.6.2 Board of Directors
Shri Amit Varadan
Joint Secretary
Deptt. of Heavy Industry,
Ministry of Heavy Industries & Public Enterprises,
Udyog Bhavan,
New Delhi-110011
Ph NO.-011-23061858
Email ID: amit.varadan@gov.in
3 Annual Report of BHEL, 2017-18, p.29

4 ibid. p. 29
5 Ibid. p. 9
[118]
Shri R. Swaminathan
Independent Director
Email ID: swami1955@yahoo.co.uk
Shri Desh Deepak Goel

Email ID: ddgoel1956@gmail.com
Shri Ranjit Rae

Email ID: ranjitrae@gmail.com
Shri Rajesh Sharma

Email ID: rajeshsharmaca@rediffmail.com
Shri D. Bandyopadhyay
Director (HR)
BHEL House,
Ph. No. 011-26001003
Email ID:db@bhel.in
Shri Subodh Gupta

Director (Finance)
BHEL House,
Ph. No. 011-26001005
Email ID: finsgupta@bhel.in
Shri S. Balakrishnan
Director (IS&P)
Integrated Office Complex,
[119]
Lodhi Road, New Delhi-110003

Ph. No.011-24366006
Email ID: balu@bhel.in
Shri Manoj Kumar Varma

Director (Power)
BHEL House,
Ph. No.011-26001002
Email ID: manojvarma@bhel.in
Shri Kamalesh Das

Director (E,R&D)
Office Address
BHEL House,
Ph. No.011-26001004
Email ID:kd@bhel.in
4.7 Major Highlights of BHEL
 Over 50 years of experience
 Consistent dividend paying company for last forty years
 Integrated power plant equipment manufacturer with capability to deliver

20,000 MW of power plant equipment per annum
 Catering to all fuel types viz. Coal, Hydro, Nuclear, Gas & Solar with entire
range
 Serving core sectors of industry viz. Power, Transmission, Industrials Systems

and Products, Transportation (Railway), Renewable Energy, Oil & Gas, and
Defence
 17 manufacturing units + 2 repair units + 8 service centres
[120]
 Infrastructure to deal with 150+ project sites (across India and abroad)
 About 40000 employees
 1 Subsidiary + 6 Joint Ventures
 References in 82 countries
 About 17,000 MW contracted
 Executing 24 projects in 14 Countries
 178 GW capacity installed globally
 30,000+ AC machines supplied
 360+ Electric Locos supplied to Indian Railways & Other Industries
 560,000+ MVA transmission equipment supplied
 R&D Expenditure (>2.5% of Turnover) – one of the highest in Indian

engineering field
 Filing patent / copyright applications regularly – total fillings of 3915 nos.
4.7.1 Business Offices
 Bangalore
 Bhubaneswar
 Chandigarh
 Chennai
 Guwahati
 Ranchi
 Jabalpur
 Jaipur
 Kolkata
 Lucknow
 Mumbai
 New Delhi
 Raipur
[121]
 Secunderabad
 Vadodara
4.7.2 Manufacturing Units
 Bangalore (3 Units)
 Bhopal
 Goindwal
 Haridwar (2 Units)
 Hyderabad
 Jagdishpur (2 Units)
 Jhansi
 Ranipet
 Rudrapur
 Tiruchirappalli (2 Units)
 Thirumayam
 Visakhapatnam
4.7.3 Service Centres
 Chandigarh
 Kolkata
 Nagpur
 Noida
 Patna
 Secunderabad
 Vadodara
 Varanasi
4.8 Joint Ventures and Subsidiaries of BHEL
Joint Ventures
 BHEL GE Gas Turbine Services Pvt. Ltd. (50%)
 NTPC – BHEL Power Projects Pvt. Ltd. (NBPPL) (50%)
[122]
 Raichur Power Corporation Limited (26%)
 Dada Dhuniwale Khandwa Power Limited (50%)
 Power Plant Performance Improvement Limited (50%)
 Latur Power Company Limited (50%)
Subsidiaries
 BHEL Electrical Machines Limited (51%)
4.9 Sector-wise Production Details of BHEL

BHEL is involved in the production of various products. Its production can be
categories into a number of sectors such as Power Sector, Transmission Sector,
Transportation Sector, Sector of Non-Conventional Energy Source, Defence Sector
and Sector of Industrial Products. The production details are as follows:
4.9.1 Power Sector
 Contributes to approximately 80% of the total revenues
 Proven capabilities to execute thermal power projects on EPC basis
 178 GW installed base of power plant equipment globally
Major Products
 Thermal: Entire range up to 1000 MW ratings including supercritical sets of

660/ 700/ 800/ 1000 MW
 Gas: Advanced class gas turbines up to 289 MW (ISO) for open and combined
cycle.
 Hydro: EM Package up to 250 MW
 Nuclear: TG sets 220/235/500/540/700 MW
4.9.2 Transmission Sector
 Offers wide range of transmission systems and products

 Present in UHV, EHV, HVDC and GIS segments
Major Products
 Power Transformers
[123]
 Instrument Transformers
 Shunt Reactors
 Switchgears
 Capacitors
 Control & Protection Equipment
 HVDC terminals
 Flexible AC Transmission
4.9.3 Transportation Sector
 Offers system range including traction machines, Electric Locomotive

(AC/DC), Diesel Electric Shunting Locos, EMU Coaches and traction drive
systems
 BHELs’ IGBT propulsion equipment accounts for majority share of IGBT
based locomotives in Indian Railways
 > 50% of Indian Railways equipped with traction equipment built by BHEL
Major Products
 Locos and EMU

 Electric Rolling Stock – AC & DC
 Electrics for Urban Transportation System
4.9.4 Sector of Non-Conventional Energy Source
Solar PV
 Offers EPC solutions from concept to commissioning for PV Power Plants

 Capability to manufacture space grade solar panels and space grade batteries
Water Management
 Offers turnkey solutions for industrial and power plant water systems
Major Products
 Solar cells and modules

 Power Control Unit (PCU) for Solar PV Plants
[124]
4.9.5 Defence Sector
 Contributing strategic equipment to Indian defence forces for over 20 years

Major Products
 Super Rapid Gun Mount

 IPMS for Naval Ships
 Turret Casting for T72 Tanks
 Equipment for naval ships
 Compact HE for LCA
4.9.6 Sector of Industrial Products & Systems
 Designs, manufactures and services various types of onshore rigs since 1975
 Capability to manufacture onshore deep drilling rigs up to a depth of 9,000
meters
 86+ oil drilling rigs supplied
Major Products
 Oil Rigs
 Well Head & Xmas Trees
 Fabricated Equipment & Boiler Feed Pumps
 Compressors
 AC Machines
 Valves
4.10 Global Presence of BHEL
 References in 82 countries across all six continents of the world and Offices in
3 countries
 First large turnkey project export by Indian co. – Libya (1977) – 2 x 120 MW
Thermal Power Station
 About 17,000 MW contracted and 11,000 MW executed
 Presence in all segments
 Thermal
[125]
 Hydro
 Oil & Gas
 Solar
 Transmission
BHEL’s major contributions
 Bhutan (4356 MW/ 98%)
 Oman (1124 MW/ 30%)
 Libya (1174 MW/ 15%)
Executing 24 projects in 14 Countries
 Executing largest ever export order of 2 x 660 MW Maitree

Super Thermal Power Project, Bangladesh
4.11 Shareholding Pattern in BHEL

In BHEL, there are mainly two categories of shareholders namely Promoter and Non-
Promoters. Mainly President of India is the Promoter of BHEL while LIC of India and
other growth funds are the Non-Promoter shareholder of BHEL.
Table 4.1: Shareholding Pattern in BHEL (as on 31.03.2019)
Shareholders Name Percentage
President of India 63.17
Foreign Portfolio Investments 11.68
Financial Institutions & Banks 15.47
Insurance & Mutual Funds 3.07
Others 6.61
Total 100.00
Source: Annual Report of BHEL, 2018-19, p.97
[126]
4.12 Major Departments in Corporate Office of BHEL
It has following major departments:
 Business Development
 Business Information System
 Company Secretariat
 Contract and Procurement
 Corporate Affairs
 Corporate Planning
 Corporate Communication and CSR
 Finance and Accounts
 Human Resource Development
 Human Resource
 Internal Audit
 Marketing
 Petrochemical
 Pricing
 Project
 Project C&P
 Project Development
 Project F& A
 Regulatory Affairs
 Security
 Vigilance
 Nodal officer for Superannuation/PF/Pension Group
[127]
Table 4.2: Ranking of BHEL in CPSEs in Terms of Gross Block (in Lakh)
Year Gross Block Net Block Rank on Gross Block
2004-05 372426 104424 32
2005-06 400663 98228 32
2006-07 443759 98874 33
2007-08 510150 98126 30
2008-09 638184 147040 26
2009-10 810969 241540 24
2010-11 981192 340092 24
2011-12 1105425 429681 23
2012-13 1195485 445849 23
2013-14 1269261 469294 23
2014-15 1310657 414052 24
2015-16 1361331 396319 24
2016-17 554082 359588 36
2017-18 582890 306884 39
Source: Various Issues of Public Enterprises Survey
Gross Block is the sum total of all the assets of a company valued at its cost of
acquisition. This is inclusive of the depreciation which is to be charged on each asset.
On the other hand, Net block is the Gross Block minus accumulated depreciation on
asset of the company. Net Block is actually what the asset has worth to the company.
The table 4.2 shows that rank of BHEL in CPSEs in terms of it Gross Block. It is very
clear from the table that from 2004-05 to 2007-08 the rank of BHEL was around 32
and 2008-09 to 2015-16 that rank was around 25 and after that the company again lost
its rank and placed at 36 in 2016-17 and at 39 in 2017-18.
[128]
Table 4.3: BHEL’s Rank in CPSEs in Terms of Employment
Year No. of Employees (including casual labour) Rank
2004-05 43302 10
2005-06 42601 9
2006-07 42124 9
2007-08 43636 9
2008-09 45666 9
2009-10 42274 8
2010-11 46748 8
2011-12 49390 8
2012-13 48399 8
2013-14 47525 8
2014-15 44905 9
2015-16 42198 9
2016-17 39821 8
2017-18 37540 8
The table 4.3 depicts that BHEL falls at mostly 8 th or 9th rank in terms of Number of
Employees in the enterprise. It is symbol of sustained implementation of HR
Management in the organization that it has been maintaining its rank.
4.13 HR Management in BHEL

The development, allocation, utilization and conservation of human resources through
their gainful employment are continuing inevitable process in any organization. The
planning, direction and control of human being in employment is a function that must
be performed diligently and efficiently, as the success or failure of every management
endeavour is dependent upon the effective administration of personnel. HR
[129]
Management plays a significant role in the management and working of every

organization. It provided leadership and direction of people in their working
relationships. Personnel problems should not be thought of as something different or
separate from technical problems. Both are in fact parts of a single situation that needs
to be handled carefully. The success of the organization largely depends on the quality
and strength of its personnel.
Today, HR Management has developed into a major function with a broad spectrum
of activities concerned with the recruitment, training, assessment, selection,
placement, development appraisal, compensation and organization. For the successful
functioning of an organization, the personnel department is required to provide a
continuous supply of competent and well trained people at all levels.
4.13.1 Structure of Board of Directors in BHEL:
The composition of Board of Directors of BHEL to maintain the independence of the

Board and to separate the Board functions of management and control, has an
appropriate mix of-
 Executive Directors represented by Functional Directors including CMD,

 Non-Executive Directors represented by Government Nominees and
 Independent Directors
The total number of Directors sanctioned for BHEL Board is 16 represented by 6

Functional Directors (including CMD), 2 Govt. nominees and 8 Independent
Directors.
There is a woman director on the Board of BHEL as required under the provisions of
Companies Act & Listing Regulations.
4.13.2 Terms & Conditions of Appointment of Independent Directors
Part-time Non-official or Independent Directors are appointed for a period of three

years pursuant to the order of the following departments/authorities/bodies:
 Department of Heavy Industry,
 Ministry of Heavy Industries & Public Enterprises and
[130]
 Government of India.
Independent Directors are required to comply with the requirements of the:
 Code of Business Conduct & Ethics for Board Members and Senior
Management Personnel,
 Code of Conduct for Prevention of Insider Trading and
 Charter for the Board of Directors approved by the BHEL Board.
Apart from the requirements and duties enumerated for Independent Directors in the
Companies Act, 2013, they are also required to observe certain Dos & Don'ts for other
Independent Directors (approved by the Board of BHEL) in the course of
performance of their duties as Independent Directors.
Independent Directors are entitled to claim a sitting fee @ Rs. 30,000/- for per Board
Meeting and Rs. 20,000/- for per Board Level Committee Meeting attended by them.
Independent Directors are not eligible for any commission pertaining to profit or stock
option.
4.13.3 Human Resource Objectives of BHEL
The Human Resource objectives of Bharat Heavy Electricals Limited are as follows:
 To develop and sustain core values
 To develop business leaders for tomorrow
 To provide job contentment through empowerment accountability and

responsibility
 To build and upgrade competencies through virtual learning, opportunities for

the growth and providing challenges in the job
 To foster the climate of creativity, innovation and enthusiasm
 To enhance the quality of life of employees and their family
 To inculcate high understanding of ‘service’ to a greater cause.
[131]
4.13.4 Human Resource Strategy in BHEL
 To meet challenging demands of the business environment, focus of the HR

strategy is on challenge of the employees’ ‘mindset’
 Building quality culture and resources
 Re-engineering and re-development for maximizing utilization of HR

potentials
 To build and upgrade competencies through virtual learning, opportunities for

growth and providing challenge in the job.
 Re-strengthening mutual faith, trust and respect
 Inculcating a spirit of learning and enjoying challenges
 Developing Human Resource through virtual learning, providing opportunities

for growth, inculcating involvement and exposure to benchmarking in
performance
4.13.5 Role of HR in BHEL
 Alignment of HR vision with corporate vision
 Shift from support group to strategic partners in business operations
 HR as a change agent
 Enhance productivity and performance by developing employees’ competency

and potential.
 Developing professional attitude and approach
 Developing global managers for tomorrow to ensure to the role of global

players
The company has over the years been committed to good corporate governance
practices. The Company’s Compliance report on corporate governance and the
certificate from the auditors of the company regarding compliance of conditions of
corporate governance as stipulated under clause 49 of the Listing Agreement.
[132]
4.13.6 A Critique of Recruitment and Selection Policy of BHEL
After having determined the number of and kind of personnel required, the HR or
Personnel Manager proceeds with identification of sources of recruitment and finding
suitable candidates for employment. Both internal and external sources of man power
are used depending upon the type of personnel needed.
The selection procedure starts with the receipt of applications for various jobs from
the interested candidates. Totally unsuitable candidates are rejected at the screening
stage. The personnel department administers various kinds of test to the candidates to
determine if they would be able to do their job efficiently. Those passing this stage are
called for employment interview. Candidates found suitable for employment are
require to go through the medical examination and reference checking. The
employment process is completed when appointment letters are issued to the
candidates clearing on the stages in the selection procedure.
Figure 4.1: Sources of Recruitment
Recruitment
(Searching Source of Personnel)
Internal Source External Source

1. Transfer 1. Recruitment at Factory Gate
2. Promotion 2. Casual Callers
3. Advertisement
4. Employment Agencies
5. Management Consultants
6. Educational Institutions
7. Recommendations
8. Labour Contractor
9. Telecasting
As shown in the figure 4.1, the various sources of recruitment may be grouped into
the above two categories.
BHEL (Bharat Heavy Electricals Limited) has adopted both the sources of
[133]
recruitment are:
 Internal Sources (recruitment from within the enterprise); and
 External Sources (recruitment from outside)
The procedure of selection will vary from organization to organization and even from
department to department within the same organization according to the kind of jobs
to be filled. The numbers of steps in the selection procedure and the sequence of
steps also vary. For instance, some organizations do not hold preliminary interview,
test or screening, whereas in other organizations such as commercial banks,
preliminary test are given to eliminate a large number of applicants. Similarly, in
some cases medical examination is given before final selection and in others medical
checkup follows final selection. Thus, every organization will design a selection
procedure that suits its requirements. However, the main steps could be incorporated
in the selection procedure are:
 Preliminary Interview
 Receiving of Applications
 Screening of Applications
 Employment Interview
 Checking References
 Employment Test
 Physical Examination
 Final Selection
The above method of selection has been adopted by BHEL. As discussed above,
every candidate for a job has to clear a number of hurdles before getting selected for
the jobs. If he is not found suitable at any stage, he is not considered for the further
stages. Thus, he will be rejected. For instance, if a candidate’s particulars in the
application are not found suitable, he will not be called for the tests. Similarly, if a
candidate fails in tests, he will not be called for the interview.
[134]
Figure 4.2: Framework of Recruitment and Selection in BHEL
Recruitment Organizational Job Analysis

Advertisement Goal
Job Description
Job Specification
Applicants Work Load Analysis
Manpower Requisition
Selection Process
Application Forms
Tests
Interviews
Referral Checks
Medical Examination
Selected candidates
The above figure clearly shows the major steps or processes followed by BHEL to
select candidates for the organization. The process starts with the advertisement for
recruitment and ends at the selection of the candidates.
Although, recruitment and selection are the two way process in any organization.
These processes are equally important for the organization as well as for the
candidates. The process comes to an end only on the execution of the steps from both
side within a stipulated span of time and in a fixed manner. For instance, any
organization issues advertisement for recruitment generally on a fixed interval of time
and mention a fixed span of time within which the applicants have to apply for the
posts and to pay required fee. After that the organization has to finish the process of
preliminary test or screening process to reduce the number of candidates to appear in
the written test or interview for the selection. Similarly, on the other hand the
applicants have to follow the instructions issued by the recruiting organization time to
time. They have to appear in the written test or computer based test (CBT) followed
[135]
by trade test or interview, if any, on a fixed date as determined by the organization.
Figure 4.3: The Recruitment Process for the Organisation as well as for the
Applicants
Organization Applicant
Vacant or New Receive Education and

Position Occurs Choose Occupation
Perform Job Analysis &

Plan Recruiting Efforts Acquire Employment
Experience
Search for Jobs

Generate Application Opening
Pool via Internal or
External Recruiting
Methods
Apply for jobs
Evaluate Applicants Impress Company

via Selection Process during Selection Process
Impress Applicants Evaluate Jobs and

Companies
Accept or Reject
Make Offer
Job Offers
Source: Cynthia D. Fisher, Lyle F. Schoenfeldt, James B. Shaw, n.4, p. 224
[136]
4.14 Human Resource Management in BHEL
HR Management has great relevance in BHEL in view of its large size and complex
structure. The corporate policy of the enterprises stated the following and important
personnel objectives:
 To evolve a participative style of management which will ensure good

working conditions and job satisfaction to all employees, wages
commensurate with their performance, career advancement and goodwill
amongst all employees and respect for the human and material resources of the
business.
 To ensure continuous development of competent managerial personnel and
make best use of both the human and material resources of the business.
 To design an organizational structure with clearly enunciated objectives and
policies where freedom to function and flexibility to perform will be ensured for
all in accordance with their abilities capacities, resourcefulness and initiative.
To achieve the above objectives, the personnel functions in BHEL, headed by a full
time Functional Director, are organized to generate an increased sense of belonging
and team spirit among the employee through the concept of Matrix Organisation at all
levels, dovetailing suitably with personnel departments at units, The concept involves
provisioning of opportunities to individuals for development from growth, while
ensuring high standards in quality of service to the units. Accordingly each of the
officers is assigned responsibilities for dealing with all matters of a few units, in
addition to specializing in some functional areas for all units. The corporate personnel
department discharges the following important functions which are:
 To evolve policies on all aspects of human resources management in the

company.
 To coordinate recruitment of personnel for all company cadres such as
Engineers/Executive Trainees, and
 To monitor the administration of the company’s policies in the units and adopt
such measures as would enable the company to achieve its corporate goals in
the area of Human Resource Management.
[137]
Computers are being increasingly made use of in personnel activities at corporate

level. Computerized bio-data of the employees is maintained by the Personnel
Department both at corporate and unit levels. A centralized data bank and
computerized statistics cell is established at the corporate personnel department, to
provide the management with information relating to management, personnel and
statistics cell is established at the corporate and statistics as and when required for
arriving at appropriate decisions. At the Unit level the General Manager
(Administration) is in overall charge of all the functions related to personnel
administration and the head of the personnel department reports to him. They are
responsible for the effective administration of all the facts of the policies and practices
of HR Management in the unit. To ensure that service is rendered by the department
to all the functional groups to their satisfaction, personnel cells are headed by a
coordinator who is responsible for coordinating all the personnel affairs related to this
cell, in addition to making his expertise or knowledge in a specific function available
to all other functional personnel cells. The Head of the Personnel Department kin the
Unit also has a functional relationship with the Director (Personnel) at the corporate
level in all policy matters to ensure commonality of approach amongst in all the units
on all matters.
The personnel manager performs a variety of functions. He acts as the eyes and ears
of the General Manager. In addition to providing leadership to the personnel
departments, he provides assistance to all functional heads in the organisation in all
matters pertaining to HR Management.
The following are important functions performed by personnel department in BHEL:
4.14.1 Manpower Planning
Manpower management is the procedure by which human resources are organized

and directed in making their contribution to current social and industrial goals. In
BHEL, there is a systematic planning of the manpower requirements and budgeting of
the human resources with requisite qualification, skills, aptitudes, merit and
suitability. This is done by advanced planning for manpower through rolling plans
made on three years basis at the units, the manpower committee prepares manpower
budget of the enterprise.
[138]
4.14.2 Recruitment
The guidelines issued by the Government as India constitute to be the basic for
recruitment at BHEL. In the case of all unskilled workers, even without any special
effort they are generally drawn from the locality. In case of skilled workers, clerks,
and other non-technical staff, possession of minimum qualification is considered
adequate and they are appointed subject to other conditions of eligibility and
reservation of posts .In case of middle level technical and non-technical posts, on par
with Government of India class I and junior scales, recruitment is made on all India
basis, merit and qualifications being the main criteria. In the case of higher non-
technical posts of E1 and E2 level candidates available in the industrial management
pool are considered first. Failing such candidates, recruitment is done on All India
basis all vacancies at lower levels are referred to employment exchange in the area.
The selection committee setup recruitment to all middle or higher technical posts
should include at least one representative of the state government. The
Executive Director can make the urgent ad-hoc appointments. In the beginning BHEL
has made recruitment to following positions:
 Trade apprentices for the post of artisan grade A, B, and C-
 Draughtsman
 Technical apprentices for the posts of Asstt. Foreman and Foremen.
 Junior Supervisory staff
 Graduate Engineers to be absorbed as officers or engineers.
The sources of recruitment go various positions are considerably wide which are:
 from employment exchanges as per the provisions of Employment Exchange

Act, 1959.
 from the open market through the advertisement in the press.
 by considering department candidates possessing the specified requirement.
 by absorption of deputationists from the central or state government and other

public sector undertakings.
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 by making reference to recognized associations and agencies who maintain

rosters of suitable persons in different skills and specialties for promotion of
the interest and welfare of the scheduled casts, scheduled tribes, ex-
servicemen and other similar categories.
4.14.3 Promotion
In BHEL, the polices on promotion are issued by the corporate office and it is found
to be a clearly defined, concise and positively with a view to avoid diverse
promotions periods, all the promotions are coordinated and administered on a
stipulated date. Such a data is announced every year by the corporate personnel
department. Generally, promotions take place in April or May every year, when a
clear appraisal is expected to be available for the year’s performance also. For
promotions in the executive cadres, merit constitutes to be in main criteria. Service
and performance in the grade is evaluated and irrespective of whether one is a degree
holder or diploma holder, consideration for promotion will be based on one’s
performance and duration of service and not mere by one’s educational attainments.
4.14.4 Training
There is a separate full fledge training division aimed at imparting and upgrading the
technical skills. The training division developed its own facility by deputing them for
training to professional institutes like National institute of Training in Industrial
Engineering, Indian Society for Applied Behavioural Sciences for programmes like
training techniques and human relations etc. The enterprise also organizes similar
programmes for the benefit of internal faculty. Supervisory development programmes
are conducted regularly with a view to develop core faculty in training technology.
The enterprises also organise specialized programme like MBO, career planning,
computer appreciation, general management programme for the middle level
managers and production management, and production planning and control, PERT &
CPM and Behavioural Science oriented programmes like sensitivity training or
laboratory training for personnel growth, inter-personal relations and team building
and communications.
[140]
4.14.5 Industrial Relations
The Industrial relations wing in BHEL is a part of the personnel department. The
wing is headed by joint personnel manager. He is responsible to maintain cordial
industrial relations within the enterprise. The manager is assisted by an industrial
relations officer and a Labour Welfare Officer. The industrial relations officer is
primarily responsible for the relations between the management and employees who
are represented by the recognized union and acts as liaison between them. He arranges
for the industrial relations meetings at the shop level, Heads of department level and
General Manager Level. He fixes industrial relations meetings between the
managements and the recognized union after getting agenda. The minutes of the
meetings are circulated by him and the decisions taken in the industrial relations
committee meetings are followed up by him for implementations. He also represents
the management at the conciliation meetings before of the conciliation officer and
also deals with the disputes before the labour courts.
4.14.6 Industrial Safety
The safety engineer is responsible for the following:-
 Providing and instituting safety procedure and observance of the same for all
manufacturing and process centers.
 Recommending protective equipment and safety devices.
 Providing for safety posters and carrying of safety educational classes in

safety measures for the workers and operators and also disseminating
broachers and write-up on matters pertaining to safety precautions.
He/She is primarily responsible for the prevention of accidents in the factory. He/She
is associated by one Technician and one Junior Technical Assistant and also a painter.
The Labour Officer is responsible for the welfare activities in the factory and in the
township. He is also in-charge of the two canteens, one outside the factory for the
staff and the other in the factory for the factory workers. He is also associated by a
Labour Welfare supervisor and one canteen supervisor and a few ministerial staff.
For the prevention and settlement of day- to-day problems between the management
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and labour unions, a three-tier machinery exists in BHEL. The first tier at the shop
level wherein the problems are discussed between the concerned shops superintends
and the representative delegates of the concerned shop. The meeting is also attended
by the Industrial Relations Officer of the personnel department. In this meeting the
matters under the jurisdiction and competence of the concerned shop superintendent
or departmental officers are discussed and settled and the matters on which no
agreement is arrived at are brought up by the union in the meetings at the second tier
or third tier.
The second tier of the machinery is at the level of Heads of departments and
representatives of the recognized union. These meetings are held once in a month.
The subjects which are discussed in these meetings are those which relate to the
general issues pertaining to the common problems of the various blocks in the factory.
The third tier of the machinery is at the level of the General Manger, the Heads of
departments and the President, General Secretary and representatives of the
recognized union. The subjects which are discussed in this meeting relate to important
policy matters which require the sanction and approval of the General Manager. With
the above machinery in existence, the industrial relations in BHEL have been very fair
and contributed to the smooth running of the industry.
Another tremendous achievement made by the BHEL as a whole is a settlement on

wage revision for its workers numbering about 73976 engaged in all the units of
BHEL. Anticipating the demands that would arise from the employees regarding
wage revision, the BHEL management had set up a joint committee to formulate the
revised and rationalized wage structure common to all units.
The joint committee in addition to representatives of the union at the unit level consist
the leaders of the central trade union organizations. It was observed that both the
management and workers representatives were satisfied with the existing machinery
of industrial relations. There has been a great similarity in the opinions of the union
office bearers irrespective of their ideology and recognition status. The discussions
held with the union leaders revealed that by and large the management has been very
response and positive in their attitude and approach in resolving employees, problems.
Trade union leaders expressed their satisfaction regarding the existing industrial
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relations machinery. On its part management has been taking swift decisions to carry
out the decisions of joint committee and ensure the establishment of a climate of trust
and confidence.
Apart from the above, the present study high lightened certain problems which were
involved in the present existing industrial relations machinery. The first and foremost
lacuna pointed out by management was the inadequate staff which had to perform
multifarious duties under various laws. Further, management advocated that the lack
of awareness about the various provisions of the laws was pointed out to be a major
handicap in the follow-up action to be taken by the workers at the plant level.
On the other hand, the unionists disclosed that labour laws were frequently violated
and infringements were rectified after a great deal of time concern over the necessity
of amending the existing law and introducing some sensible provisions regarding
union recognition and collective bargaining. They were of the view that adjudication
has been getting costlier day by day and it was gradually going out of their reach to
cope-up with the ever mounting costs involved in the process.
4.14.7 Grievance Machinery
There is hardly an industrial concern which functions without any grievance of

employees at all times. In some concerns, the employees have common complaints
against their employers, while in others; it is the employers who have a grievance
against their employees. Broadly speaking, a complaint effecting one or more workers
constitute a grievance. The complaints may relate to promotion, pay fixation, payment
of wages, leave interpretation of service agreements, working conditions, seniority,
transfers, work assignments, discharge or dismissal or a complaint against a foreman,
against the quality of the plant or the parts unused in it, against machinery. Generally,
a grievance is any dissatisfaction that adversely affects organizational relations and
productivity. The term “Grievance” is used to designate claims by workers of a trade
union concerning the workers individual or collective rights under an applicable
collective agreement, individual contract of employment, law regulations, works rule,
custom or usage, such claims involve questions relating to the interpretation or
application of the rules concerned.
[143]
An employee is dissatisfied and harbours a grievance when he feels that there has
been an infringement of his rights, that his interests have been jeopardized and that his
due claim have been overlooked. This sense of grievance generally arises out of a
misinterpretation or misapplication of company policies and practices. It has been
observed that grievances exist in the minds of individuals are produced and dissipated
by situations, are fostered or healed by group pressures, are adjusted or made worse
by supervisors, and are nourished or dissolved by the climate in the organization
which is affected by all the above factor and by the managements.
4.14.8 Grievance Machinery in BHEL
With the object of providing employees easy and readily accessible machinery for the
ventilation and prompt redressal of their day-to-day grievance, a mutually agreed
grievance procedure is adopted. This grievance procedure may be availed by
workman or employees of all the departments. This will not cover trainees or
apprentices. The Grievance committee consisted of two representatives of the
management and two representatives of the recognized union. Deputy General
Manager (Production) or his nominee and chief personnel manager will be the
management representatives on the Grievance committee. Two representatives of the
recognized union will be nominated by the recognized union.
4.14.8.1 Scope
Complaints effecting one or more individual employees in respect of their wage

payments, overtime, leave, transfers, promotion, seniority, work assignment, working
conditions, interpretation and implementation of service agreements, welfare
amenities etc., constitute grievance where the points at dispute are of general
applicability of considerable magnitude and where policy matters are involved, they
will fall outside the scope of this procedure. In case of any grievance arising out of a
discharge or dismissal of workman or employee, this grievance procedure shall not
apply. Instead, discharges or dismissed workman shall have the right to appeal to the
dismissing authority or to the appellate authority.
[144]
4.14.8.2 Various Stages of the Grievance Procedure
Stage I
The aggrieved employee or workman well first present his grievance in person to the
foreman concerned within one week from the date of occurrence of the grievance. All
such grievances will be entered in a grievance register maintained, in the prescribed
form, by the said officer, who will give reply to the employee or workman within
seven days of the date of receipt of the grievance.
Stage II
If the employee is not satisfied with the decision of the officer or fails to receive an
answer within the stipulated period, he will either in person or accompanied by his
departmental representatives of the recognized union, present his grievance in writing
to the shop manager or senior engineer. For this purpose, fixed hours will be specified
during which on any working day, an aggrieved employee or workman could meet the
said officer for presentation of his grievance. The said officer will give his answer in
writing within 7 days of the presentation of grievance. If action cannot be taken
within that period reasons for the delay should be recorded.
Stage III
If the discussion of the shop manager or senior engineer is not satisfactory, the
aggrieved employee or workman may request the shop manager or senior engineer for
forwarding his grievance to the chief personnel manager, who has to communicate the
reply with 7 days from the date of receipt of his grievance.
Stage IV
If the reply of the Chief personnel manager is not satisfactory, then the aggrieved
employee or workman may request for forwarding his grievance to the Grievance
Committee which will make its recommendations to the General Manager within 10
days of the employee’s request. If the recommendations cannot be made within this
time limit, the reason for such delay will be recorded. Unanimous recommendations
of the Grievance Committee will be implemented by the management. In the event of
difference of opinion among the members of the grievance committee, the view of the
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members along with the relevant papers will be placed before the General Manger for
final decision. In either case, the final decision of the management will be
communicated to the employee concerned by the chief personnel manager within 5
days from the receipt of grievance committee recommendations.
Stage V
The aggrieved workman or employee; has right to appeal to the General Manager for
a revision of the final decision of the management. In making this appeal, the
employee if he desires so, will have the right to take a union official along with him to
facilitate discussions with the General Manager. The General Manager or the person
designated by him will communicate the decision within a week of the employee’s
revision petition. If no agreement could be reached the union and the management
will refer the grievance to voluntary arbitration. Where a workman or employee has
taken up a grievance for redressal, under this procedure, the formal conciliation
machinery will not intervene till all steps in the procedure are exhausted. A grievance
will be presumed to the form of dispute only when the final decision of the General
Manager in respect of the grievance is not satisfactory to the workman or employee.
If a grievance arises out of an order given by management, the said order shall first be
complied with before the workman or employee concerned invokes the procedure laid
down for redressal of grievance. However, there is a time lag between the issue of
order and its compliance, the grievance procedure may immediately be invoked but
the order nevertheless must be complied with on the due date even if all the steps in
the grievance procedure have not been exhausted. The union representatives on the
grievance committee will have the right of access to any document relevant to the
enquiry and reference to which may be necessary to understand the merit or otherwise
of the workers or employees grievance. The management representatives will have the
right, however, to refuse to show any document or give any information which they
consider to be of a confidential document however it may be used against the
employee in the course of the grievance proceedings. There is a time limit within
which an appeal may be preferred from one stage to other. For this purpose, the
aggrieved workman or employee will within 72 hours of the receipt of the decision at
each stage (or if no decision is received, on the expiry of the stipulated period) file his
[146]
appeal with the authority at the next higher stage, should he feel inclined to appeal. In
calculating the various time intervals under the above claws, holidays will not be
reckoned.
But most of these grievance were settled at the level of stage I. Few other grievance
were settled at the level of Stage II and very few grievances were settled at the level
of stage III. The present study highlighted that most of the grievance at the committee
level settled through the process of conciliation. Other grievance settled through
adjudication and arbitration. The following table indicates the mode of settlement of
grievance.
It was observed that most of the grievance in case study unit pertained to the seniority
followed by the promotion, pay fixation, financial benefits, house rent allowed and
leave facilities. There is a strong institution base for resolving the grievance in the
unit. The Grievance Redressal procedure adopted by the unit is successful in settling
the grievance in the enterprise. It was found that existing grievance machinery has
aroused a cordial atmosphere in the undertaking for harmonious industrial relations.
The management and trade unions are cooperative with each other I resolving the
grievance the main thing is that it is not the procedure or the number of subject that
are dealt with by the organsiation but be that wherever a grievance procedure is
followed. There should be definite time limit set for the supervisor according to which
he has got to give a reply within the specific period and not only give a formal reply
but he should see that it is implemented so. The grievance procedure adopted in the
case study unit fulfills all these requirements.
4.14.9 Unionism in BHEL
Under democratic institutions what one gets universally in one form or the other in the
free organisation of labour, are trade unions. Depending upon the ideology and
political affiliations, the number of trade unions has increased over the years and they
have practically/developed into competing centers. A heavy responsibility is cast on
the management to develop labour relations system fully taking into account the
existence of trade union competition. The BHEL is no exception to this situation
consists of multiple trade unions. All are registered trade unions in BHEL. The
various trade unions, associations exist in the enterprise to look after employees’
[147]
welfare and service conditions. The BHEL Hyderabad Unit was divided into two units
viz., Heavy Electrical Equipment Plant and Switch-Gear Unit. These Units were
governed by different trade unions. In Heavy Electrical Equipment Plant, there are 10
trade unions and all are registered. The following table reveals the different registered
trade unions in Heavy Electrical Equipment Plant. The above two recognized unions
have been playing a crucial role in protecting the interest of the workers. Apart from
the trade unions, All BHEL Workers Association and Management Association have
also been playing an important role in protecting their own interest. It was observed
that there is not much scope for the inter-union rivalry in most of the BHEL Units. It
is due to the fact that majority of the trade unions are affiliated to the INTUC in both
the units.
The Trade Unionism is very powerful inn BHEL. As true to its very purpose and
objectives, demands were raised from time to time by the recognized union., which
were settled to a large extent. The demands are largely pertaining to regularization or
NMR or work charged employees, absorption of civil engineering staff. Enhancement
of wages to work charged NMR staff, Departmental promotions for various categories
of employees, Revision and rationalization of pay scales, Holidays, Leave rules,
Medical facilities and Recreation facilities etc., From time to time employee unions
have been raising their demands pertaining to matters which have a bearing on their
service conditions, living conditions, welfare and safety measures. Several agreements
which were entered into between the management and representatives of recognized
unions in the areas of absorption of NMR or work charged employees, promotions.
Payment of House rent allowance and city compensatory allowance, overtime
allowance, filling up the posts by departmental candidates. Absorption of Apprentice
Trainees, Reduction of working house, Revision of pay scales in respect of certain
categories of workers, Reduction of working hours to the Administration staff,
increase of casual leave to industrial workers, Dearness and other allowances and
revision of wages for daily rated and casual NMR and work charged employees. since
early 1960’s to present day. The Appendix I presents list of agreements reached
between management and unions.
It is observed that management of BHEL has been enjoying excellent cooperation
[148]
from labour barring few stray incidents. BT and large, management, has been very
sympathetic and considerate towards the employees demands. Most of the problems
were settled across the table through discussions, negotiations and dialogue rather
than through confrontation or show of strength. Several agreements signed between
the two are a clear indication of the cooperation and understanding between the
management and employees.
4.14.10 Welfare Measures in BHEL
The management of the BHEL has been proving various welfare facilities to
employees in addition to the requirements of the workmen compensation Act 1923,
the Employees State Insurance Act 1948 and the Employees Provident Fund Act
1952. The welfare amenities in BHEL can be classified into tow heads viz., statutory
and non-statutory.
4.14.10.1 Statutory Welfare Measure
The Statutory Welfare Measures include those measures for which government of any
other competent authority formulate guidelines, rules and acts from time to time. This
consists of mainly Provident Funds, Gratuity, Health Facilities etc.
4.14.10.1.1 Provident Fund
A new entrant compulsorily becomes a member of BHEL Employees Provident Fund

from the beginning for the month following that which completes 120 days of
continuous service under the Provident Fund Act an employee is required to
contribute at the rate of 8.33 percent of pay plus DA to the Contributory Provident
Fund (C.P.F) company makes a matching contribution.
Members are entitled to get the full company’s contribution after contributing a
minimum period of seven years service. However, officers on contract basis, do get
the full amount of company’s contribution at the termination of their contract service
with the company, irrespective of their period of contribution.
4.14.10.1.2 Gratuity
All the employees of BHEL drawing Rs. 10,000 and above are governed by the
BHEL Gratuity Rules. BHEL Gratuity Rules provided for payment of gratuity in the
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case of death while in service even before eligibility period. BHEL Gratuity Rules
made provision for maximum ceiling limit of Rs. 30,000 on the total amount of
gratuity payable to an employee. Gratuity shall be payable to an employee on the
termination of his employment after he had rendered continuous service of not less
than five years (a) on his superannuation , or (b) on his retirement or (c) on his death,
or disablement due to accident or disease. Gratuity equal to 15 days wages for every
year of service, subject to a maximum of 20 months wages or Rs. 30,000 whichever is
less, is payable to an employee.
4.14.10.1.3 Medical and Public Health Services
All employees of BHEL are eligible for free medical aid. Bharat Heavy Electricals
Ltd., organization has got of fully equipped hospital attached to its township. There is
provision for every modern specialization in the hospital. To elaborate this point a
little further, it may be stated that there is a surgeon, a fully qualified Anesthetist, with
operation theatre with modern equipment under his control, a Gynecologist, a
Physician, an Ophthalmologist and also a Dental Surgeon in the BHEL hospital. An
employee of the BHEL Company can avail modern facilities available in the hospital
under the ablest care of the above specialists. Presently, the hospital consists of 260
staff members and 160 beds. The employees who are not residing in the township of
BHEL and residing in various parts of the city are at liberty to go to any medical
practitioner in the city for availing medical help. The annual budget for the hospital is
Rs. 50 lakhs, out of which Rs. 15 lakhs are spent on procurement of medicines. The
amount incurred in this direction by them would be reimbursed by the company
provided the medicines used are reimbursable as per the Government list.
4.14.10.1.4 Canteen Services
BHEL is having two canteens, one for administration staff and other for the Factory
workmen. The latter is situated within the factory premises and called works canteen.
No doubt the provision of canteen facilities is according to the provisions of the
Factories Act. While it apart, both the staff canteen and the works canteen are
provided with latest modern electrical equipment. For example, there are electrical
segarees which is useful for preparing vegetables, sweets and snacks; there is a boiler
pan (Non-pressure type) which is useful for boiling rice and for tea and coffee mixing.
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With the modern kitchen electrical equipment the required neatness and quick service
could be ensured. With help of this modern electrical equipment, meals and other
food materials are prepared very quickly and supplied to its employees at a subsidized
rate. It is a matter of interest to write that even in these days where prices are all time
high, a plate of idly is supplied to the employees for only 0.15 paise and plate meals is
supplied only at the rate of 0.70 paise in the staff canteen and at the rate of 0.50 paise
in the works canteen.
4.14.10.2 Non- Statutory Welfare Measure
Those welfare measures which are generally established by the organization

according to its Vision, Mission and value are termed as Non-Statutory Welfare.
Generally organizations have some liberty to implement these measures in their
organizations. But, for effective implementation of the concept of HR Management
within the organization, these measures are imperative to be implemented. Staff
Benefit Funds, Death Relief Fund, Group Insurance Scheme etc. are the major
examples of these measures.
4.14.10.2.1 Staff Benefit Fund
The management has started a scheme of staff benefit fund. The management has
sanctioned Rs. 10,000 just as grant and all the employees below the officer level are
eligible to become the members of the staff benefit fund. The members of the fund are
required to contribute only 0.25 paise a month. This is also arranged to be recovered
from their monthly salaries in the pay bill itself. This fund is managed by a committee
and the committee is authorized to sanction money to the members of the fund for the
purpose of educating the children of the members of the fund for the payment of their
fee, for the purchase of books, for the sickness of the member himself, etc., when the
members of the fund is found to be in distress, when his house is being burnt or any
such natural calamity, the committee is authorized to provide an assistance to the tune
of Rs. 30,000/- this being a maximum to the members of the staff benefit fund. There
are nearly 3,500 employees who have become the members of the staff benefit fund.
Efforts are being made to persuade the eligible employees to become the members of
the fund.
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4.14.10.2.2 Death Relief Fund
The BHEL management has started another fund called Death Relief Fund in 1972.
All the employees of the BHEL right from the General Manager down to the unskilled
worker of the Factory are eligible to become members of the Death Relief Fund. On
becoming a member of the fund, one rupee is deducted from his salary and thereafter
one rupee is deducted from his salary and thereafter one rupee is deducted from every
member of the fund. There are nearly 10,500 members as on today on the rolls of
death relief fund. If any employees who is member of this fund dies, If any employees
who is member of this fund dies, his heirs may be given immediately Rs. 31,000/-. By
this, the bereaved members of the family need not wait for the money is due to them
towards provident a fund, gratuity and other terminal benefits. Contributing one rupee
by a member is nothing for him. But all contribution put together giving to the
bereaved members of the family of one late member is a substantial relief. This is
thus, a very good welfare measure. Another advantage of this fund is; it could be
immediately given to the heirs with no lapse of time.
4.14.10.2.3 Group Insurance Scheme
With a view to providing the most essential financial security to the families of
employees in the event of death while in service of the company BHEL takes great
pleasure in introducing the Group Insurance Scheme of LIC under which the life of
every full-time employees of the company will be insured for amounts as given below
and the premium is paid by the company. The entire cost of premium will be borne by
the company and the employee will not be called upon to make any contribution
towards premium. All employees are covered under the Group Insurance Scheme of
the LIC.
4.14.10.2.4 Housing Facilities
Regular employees with not less than 5 years service are eligible for the grant of
advance for construction or acquisition of a house or flat. In the case of ready built
houses the agency offering for sale should be Government, semi- government or an
autonomous institution. Advance not exceeding Rs. 25,000/- can also be granted for
enlarging living accommodation in a house owned by the employees. The advance is
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restricted to 75 months pay plus D.A or Rs. 1,00,000 or 80% of the cost of house
whichever is the least. It is further restricted to paying capacity of the employee which
is taken at 40% of pay plus
D.A All advance together with interest thereon is recoverable in equal monthly
installments within a period not exceeding 25 years. The advance shall carry simple
interest at the rate notified from time to time.
4.14.10.2.5 Advances
The Bharat Heavy Electricals Ltd., company is earmarking a certain provision in its
budget towards the grant of car advance, motor cycle/scooter advance and bicycle
advance. Every employee whoever is in receipt of Rs. 250 per month and more, as
basic pay is eligible and they will be granted scooter advance on the basis of seniority
subject to availability of the funds within the budgetary limits. Each individual
applicant is granted to a maximum of Rs. 3,000/- towards scooter advance and interest
at the rate of ten % is charged thereon. The recovery can be made in sixty equal
installments unless otherwise the individual applicant requests for reduction in
instatements less than sixty. In the similar way some amount is earmarked every year
for the grant of car advance, every employee is eligible but the criterion is ability to
pay. Therefore, normally employee of officers level are granted car advance is 12
months basic pay of individual employee subject to a maximum of R.s. 16,000 which
can be recovered in eighty installments . The same interest as that of scooter advance
is charged on this amount. Likewise, some amount is earmarked in every year budget
for the grant of bicycle advance of Rs. 200 the amount is recoverable in twenty easy
installments.
Apart from the above facility, there is a provision for allotment on priority basic from
the Government quota, for the motor cycle/scooters and cars for the employees of
Bharat Heavy Electricals Ltd., Every year, the applicants who requests for the
allotment of most cars or scooters on priority forms, and those applications are
forwarded to the Ministry, Government of India and they are allotted in their turn. By
this method, the employees of Bharat Heavy Electricals, Ltd., are getting scooters and
cars from Government quota at fairly reasonable Government rates.
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4.14.10.2.6 Leave Travel Concession
All employees of Bharat Heavy Electricals Ltd., irrespective of their pay range and
pay scale are eligible for leave travel concession. Every employee is asked to declare
his home town to which he is required to visit every year for discharge of his religious
obligations and where their parents and kith and kin live at the time of his joining the
organization. That particular employee can visit that particular home town and for
such a visit once in two lock years and he is eligible for leave travel concession
irrespective of its distance to the home town.
4.14.10.2.7 Educational Facilities
There are four schools in the BHEL Township which cater to the needs of education
for the children of its employees. One is zilla parished High School in Telugu
medium. The company itself has provided a building and also furniture to an extent.
There is one Higher Secondary School (with Central School Regulation and Rules) in
English medium. Majority of the children of the employees are having their schooling
in this school. There is one MISSIONARY SCHOOL in English medium. The
management of this Missionary school has a proposal to make it exclusively for girls.
There is also one Kindergarten school called Geetanjail. In this school, medium of
instruction is in English at the level of lower and higher KGs. For higher studies
employees may either be sponsored by the company study leave subject to certain
eligibility criteria. If sponsored by the company, employees will execute a bond the
period and amount of which depend upon the period and place of study or training, if
granted study leave, the bond is normally 3 years or Rs. 10,000 in lieu thereof.
Minimum service for grant of either is normally 3 years including training
apprenticeship in the company. With the above educational facilities, the employees
of the Bharat Heavy Electricals Ltd., are quite satisfactory.
4.14.10.2.8 Other Facilities
There are two clubs in the BHEL Township for its employees residents. One is called
BHEL club and other is called International Club. Every employee can become a
member by giving a subscription of 0.50 paise every month , of the BHEL Club and
there is a big building constructed by the company itself for the club facility with a
[154]
big auditorium , so that dramas , dance performance and such other cultural activities
could be arranged in the auditorium. There is a scope left also for a open air theater.
This facility could be used in the summer. There is also a Library attached to the
BHEL club and every member could make use of this Library facilities. So far as
International Club is concerned, all the officers could become members. One good
library and also a bar is attached to the club. Another attraction of the International
Club is the swimming pool, which may perhaps be of its kind in the whole of twin
cities with its modern system of outflow and inflow of the water of the a swimming
pool .In the BHEL, township attached to its factory there is an ample playground
available. With its vast scope for encouragement of sports and games by BHEL
management there are football and hockey grounds, volley ball, basketball, and
badminton courts. BHEL management as a matter of policy recruits some good
players in each of these games and encourage them to improve their talents in sports
and games.
4.15 Safety Measures in BHEL
Safety of workers for prevention of accidents assumes importance in a factory like

BHEL where high sophisticated and complex nature of machinery is being used in
manufacturing process. For this work, there is an Industrial Safety Committee and
shops Safety Committee for which the Safety Engineer is the Convener. The duties of
the Safety Committee are as below:
 Proving and instituting safety procedures and observance of the same for all
manufacturing and process centers.
 Recommending for protective equipment and safety devices.
 Providing for safety posters and carrying out safety educational classes in
safety measures for the workers and operators and also disseminating
brochures and write-ups on matters pertaining to safety precautions
In order to fulfill all these functions the committee meets once in a month to review
reports of accidents, study safety suggestions, discuss training arrangements, organize
refresher courses and draw up recommendations for new, improved safety measures.
However, the committee work certainly deem not end there. Each meeting is carefully
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minutes and all suggestions are immediately implemented. At regular intervals, a

member of the committee visits factory departments to identify unsafe working
conditions and practices, and suggest corrective measures. Though the organizational
set up of the safety committee differs marginally from each other, the structure of a
typical safety committee at BHEL basically follows the pattern outlines below.
Composition of the Safety Committee
Deputy General Manager (Production) Chairman
Deputy Manager (safety) Secretary
Personnel Manager Member
Manager (Services) Member
Chief Medical Officer Member
Representatives of Industrial Workers Two Members
It is noticed that safety at BHEL follows a definite pattern a systematic, logical

process, calculated to install the maximum appreciation of safety in its workers. The
following table reveals the analysis of the accident data from 1981-87 in various
production shops. The overall study reveals that management of the BHEL has
evolved very comprehensive employee welfare programmers covering both workers
as well as officials. Management as well as trade union leaders expressed their
satisfaction in this regard. Because of the care that is being taken by the management,
work stoppages have been very few. Thus, human side of enterprise is being taken
care of by the management with utmost care.
4.16 Workers Participation in Management

With the rapid growth of socialistic and democratic ideas, workers participation in
management became a popular slogan in the fast developing countries all over the
world. The national goals of democratic socialism aiming at reducing inequalities in
different walks of life and ensuring a minimum desirable standard of living through
democratic and peaceful means. It can be attained through the optimization of
production of goods and services and it is possible through creation of democratic
atmosphere at the place of production. The responsibility for optimizing productivity
[156]
falls squarely on the shoulders of workers and management. Mere wage increase no
longer suffices, what is needed is a human engineering approach to solution of human
relationship problems. It is possible through the system of participative management
at all strata on the basis of equality and mutual respect for specific and rightful role of
both labour and management in industry. In a structure of political democracy every
adult has an equal opportunity for participation. Labour should no longer be regarded
as “commodity value” that is to be brought in maximum use, replaced periodically
and discarded when damaged. It is the human factor which will determine the final
productivity of the enterprises. Thus, the vital role of workers and importance of his
participation in management practices is clearly recognized. The system of workers
participation in management has been discussed and debated quite extensively in the
past many years and also adopted in several countries and industries in different
forms. The form and connotation of the terms vary according to the socio-economic
goals of a particular country.
But management experts and executives look upon it as a tool for improving the
overall performance of an enterprise, for them, it means that workers are given an
opportunity to take part in those decisions which affect their wages, their working
conditions, their vary jobs, and this participation paves the way to harmonious
industrial relations in an atmosphere which is conducive to increasing productivity
and efficiency for labours. It is just like a co-decision or co-determination. So, the
concept of workers participation in management has been a very confused,
controversial and debatable issue in the field of personnel and industrial relations. In
general, it broadly means involvement of workers in the decision-making. The
concept of workers participation in management refers to situations where the system
provides an opportunity for workers to enjoy job autonomy or right to influence the
managerial decisions.
In India the concept of workers participation in management has been advocated for
achieving a wide range of objectives such as increasing productivity and production,
greater efficiency and job satisfaction, improved industrial relations, better discipline,
improved operation of safety measures and workers welfare activities, the
development of the human personality and internal leadership, creation of a sense of
[157]
belonging and establishment of harmonious industrial relations. These objectives may

be achieved as a result of consequences flowing from the process of workers
participation.
4.16.1 Workers Participation in BHEL
BHEL is a multi-unit corporation with several large plants located in different parts of
the country. Till 1972 the individual plants and their own self-contained collective
bargaining machinery with the usual multiplicity of unions as elsewhere in industry.
Participation in different forms and areas of operation broadly in line with the
participative forum such as works committee, production committee, education,
grievance committee, etc., envisaged in the statues and the Industrial Policy
Resolution, has been in vogue in various units of BHEL. In April 1973, a bipartite
joint committee at the apex national level, consisting of representatives of the
management and representatives of employee drawn from the local recognized unions
of the plants and eminent leaders of the two major national trade unions, namely,
INTUC and AITUC was constituted. Subsequently with a view to broad base the
representation on this forum even unions having ten per cent following have been
given representation on this forum, besides corresponding representation to
central trade union organizations of INTUC, AITUC, CITU and EMS in
proportion to the following of their affiliates in the different units. The present
composition of the joint committee of BHEL has been shown in Ann. No. 1. The
tenure of the joint committee is generally decided by the committee itself, in a true
spirit of bi- partisan and enjoys normally two years tenure excepting for singular
situation where the committee has decided unanimously to continue beyond two
years. At the time of reconstitution in 1973, 1975, & 1977 the committee decided the
mode of determination of representation through mutual consultations and consensus.
The effectiveness of the forum has been distinctly built on certain features which are
essentially very special to this BHEL forum, namely.
 The decision-making process – the decisions are taken in the joint committee
in an atmosphere of cordiality and understanding and usually by consensus.
 The Sanctity of Decision - The joint committee decisions or agreement have
always enjoyed an unquestioned sanctity and respect.
[158]
 Participation based on equal opportunity – The representative on the joint

committee irrespective of their affiliations, etc., have an equal opportunity for
frank and open expression of their view points or position.
 Broad–based representation – The Joint committee has a broad-based
representation which represents over 90 per cent of the employees through
various unions.
Both management and workers representative have realized the need for effective
cooperation and have been working in a cordial atmosphere. It is hoped that in course
of time, it would be possible to extend the scope and coverage of the joint committee
to ensure maximum contribution from one and all and maximize the benefits. Taken
as a whole, the joint committee has been functioning very successfully, Both parties,
i.e., management members and representative of trade unions have been functioning
in a very cordial atmosphere. All major issues are discussed and deliberated before
any decision is taken on matters considered by it. The devise of joint committee has
succeeded in creating a climate of trust and confidence. A cross- section of trade
union representatives as well as executives have responded very favorably regarding
the working of the joint committee during the course of discussions held with them.
The joint committee of BHEL which has been functioning for more than a decade,
now has institutionalized the epitome of participation and has discussed and settled
number of issues. Maters that are generally considered by joint committee includes:
 Revision and rationalization of pay scales.
 Framing the employees’ participation schemes at the shop and plant levels.
 Promotion of various categories of employees.
 Reduction of working hours.
 Fringe benefits.
 Bonus.
 Incentive payments.
 Interim relief fund.
[159]
 Holidays.
 Rationalization of leave facilities.
 Medical facilities.
 Overtime allowance.
 Recruitment to various categories of employees.
 House rent allowance and city compensatory allowance.
 Facilities to the unions.
This forum does not concern itself to the settlement of employee demands only but
also the health of organization too. It is also concerned with increasing production and
productivity, quality and technological improvements and reviewing the work of the
shop and plant level participating forums. Another dimension of the success of this
apex level form is revealed by the stability witnessed in the industrial relations
climate in the organization. Having created a reasonable infrastructure and a general
participative culture through the functioning of the joint committee and other allied
measures and encouraged by the achievements of the participative forum at the apex
level, BHEL extended the participative system from the apex level down to the grass
root level so as to ensure that the spirit of participation permits down the plants and
shop floor levels in the various units of the company. Most of the BHEL units consist
of production department. According to the formula of representation under the
scheme of participation in BHEL representative of workers from amongst those
actually engaged in the plant or in shop as the case may be are nominated by the
unions in the ratio of two of the recognized union to one of INTUC and one of
AITUC Central.
The latest scheme of employee participation promulgated by the Government of India

significantly enlarged the scope of participation both at the shop floor and the plant
level in BHEL. Most of the functions of the shop council related to:
 Assist the management in achieving monthly or yearly production targets.
 Improvement of production, productivity and efficiency, including elimination

of wastage and optimum utilization of machine capacity and manpower.
[160]
 Specially identify areas of low productivity and take necessary corrective steps
at shop level to eliminate relevant contributing factors.
 To study absenteeism in the shop departments and recommend steps to reduce

them.
 Safety measures.
 Assist in maintaining general discipline in the shop.
 Physical conditions of working, such as lighting, ventilation, noise, dust, etc.,

reduction of fatigue.
 Welfare and health measures to be adopted for efficient running of the shop.
 Ensure proper flow of adequate two-way communications between the

management and the workers, particularly on matters pertaining to production
figures, production schedules and progress in achieving the targets.
The functions earmarked for the plant level participation are more elaborate than
those for the shop level. These include.
 Evolution of productivity schemes taking into account the local conditions
 Planning, implementations, fundamental and review of monthly targets and

schedules
 Materials supply and its short fall
 Storage and inventories.
 Improvements in productivity in general, and in critical areas in particular.
 Quality and technological improvements
 Machine utilization, knowledge and development of new products.
 Operational performance figures.
 Matters not resolved at the shop level or concerning more than one shop.
 Review of the working of the shop level bodies.
 Review of the operating expenses, financial results and cost of sales.
[161]
 Absenteeism
 Initiation and supervision of workers training programmes
 Administration of social schemes.
 Safety measures
 Township administration
Financial matters have been included for the first time, within the scope of
participation at this level. The scope of welfare a matters is also much wider.
Inclusion of environmental matters, community development and pollution control
extends the scope of participation beyond the plant.
There are certain problems involved in the functioning of the participative forums at
BHEL when the unit has been given scope for the trade unions to participate at the
apex level; they require certain knowledge and skills in decision making process. But
it was observed that most of the workers representative and lacking knowledge of
these aspects. Accordingly, some management representatives suggested the need of
education and training of workers representatives for effective participation in
decision-making. The success of the participative management greatly depends upon
their in-built character. It depends upon their attitude and outlook of that the parties to
the councils and the atmosphere in which exchange of thoughts and opinions takes
place. So, the workers participation in management programme cannot achieve its
objective without developing the necessary attitude on the part of
management and workers. While on the management side there has been no change in
their traditional attitude towards labours, labour too continued to be divided on
account of multiple unions and able to speak with one voice. The labour has realized
the need for unit and gave up its traditional agitational role to function as responsible
partner in industry, also certain standard of education helps to maintain good labour
management relation, decision making skills in councils, sharing responsibility and
power.
Training for representatives of councils in the area of basic technology of industry,

primary management practices and organizational behavior and in committee work
for office-bearers of councils would help in effective participation in fixing and
[162]
implementing; the norms or organisation. And moreover, it helps in improving inter-

personal relationship, and working of the council. The BHEL management accepted
the philosophy of workers participation in management as a national policy without
any apparent at hindering the participation of employees in management. It was
observed that the management treated the workers representatives as an enlightened
union leader, one who would protect the workers interest while operating, at the same
time in the interest of the company. The BHEL management has been positive. It is
enthusiastic to involve people at all levels in the process of decision- making. The
present research study reveals the fact that the BHEL management has consistently
encouraged the recognized trade union to engage themselves in healthy trade union
activities during the workers hours. On the other hand, workers representatives view
that they alone have the monopoly to protect the interest of the workers and have
viewed these forums as platforms to further strengthen their roles to protect the
unjustified interest of the workers to the detriment of the organisation. The trade
unions utilize the participative forums to further their union interest and do take little
interest in orgainsational vitality especially in the multi-union scenario. The trade
unions are reluctant to take upon themselves managements functions in production,
productivity, maintaining discipline, etc., A feeling persists in them that management
and labour are two opposite sides. They find themselves in a different position to rise
above class-consciousness. They have a feeling that the management is indifferent or
non-responsive to workers issues contrary to what is prevalent. Here it appears to be a
considerable gap between workers and management, even though it does not have
much effect on the production, its performance and industrial relations. This gap can
be bridged by giving proper training and motivation to the workers. With all the
negative experience management is still hopeful and has a belief in improvements in
future. It is seriously interested in making participating of workers in management - a
success.
4.17 An Assessment of HR Management in BHEL

The assessment of proper implementation of Human Resource Management in Bharat
Heavy Electricals Limited can be done by the analysis of the information provided by
the below mentioned tables:
[163]
Table 4.4: Break-Up of Total Employees in BHEL
Supervisory Non-Executives Casual/ Contract

Managerial/
Year Non- daily Rated Workers/ Total
Executives Unionized Skilled Unskilled
Unionnised Workers Employees
2004-05 9984 0 7175 22504 3639 0 - 43302
2005-06
2006-07 9567 0 7479 22494 2584 10078 - 52202
2007-08 10353 0 8329 22744 2210 0 10722 54388
2008-09 11038 0 8872 23774 1982 0 11103 56769
2009-10 11685 7921 1116 24389 1163 0 11543 57817
2010-11 12210 7777 1301 21960 3500 1963 12017 58765
2011-12 13690 8208 1261 24994 1237 0 11773 61163
2012-13 13564 8449 1019 24443 924 0 14003 62402
2013-14 13347 8085 889 23599 1605 0 0 47525
2014-15 12727 7416 1103 22067 1592 0 22600 67505
2015-16 12166 0 8041 20909 1082 0 20807 63005
2016-17 11590 0 7645 19617 969 0 19577 59398
2017-18 10943 0 7285 18595 717 0 19777 57317
The table 4.4 shows the bifurcation of total number of employees in Bharat Heavy
Electricals Limited. As per the table, the BHEL consists of various categories of
employees such as employees of Managerial or Executive cadre, employees of
supervisory cadre and non-executive employees. Apart from this, there are daily rated
as well as contractual employees also in BHEL.
The table depicts a trend starting from 2004-05 to 2017-18 that the proportion of non-
executive as well as daily rated and contractual employees are mostly increasing with
the passes of the years however in the year 2016-17 and 2017-18, the proportion starts
decreasing. This shows that the management of BHEL is of the thought that
employees of lower cadre even daily rated and contractual are more productive rather
than employees of higher cadre. In some of the year the number of contractual
employees is zero, this suggests that there must be a absorption policy for regularize
the service of contractual workers and turn them into permanent employees of the
organization. On the other hand, there may be effective scheme of retrenchment and
some of the employees during the year 2016-17 and 2017-18 may be retrenched.
[164]
Table 4.5: Number of Employees and Houses Constructed in BHEL
No. of House No. of Houses Total No. of

Total No. of
Year Constructed Under Houses
Employees
in Township Construction Constructed
2004-05 43302 32782 0 32782
2005-06 42956 32845 0 32845
2006-07 42124 31067 0 31067
2007-08 43636 31067 0 31067
2008-09 45666 31067 0 31067
2009-10 45274 31067 262 31329
2010-11 46748 31067 262 31329
2011-12 49390 31329 300 31629
2012-13 48399 31329 300 31629
2013-14 47525 31629 243 31872
2014-15 44905 32926 86 33012
2015-16 42198 31589 166 31755
2016-17 39821 29959 0 29959
2017-18 37540 21465 26 21491
The table 4.5 provides information of year wise total number of employees in the
Bharat Heavy Electricals Limited and the number of houses constructed or under-
construction for the their employees. Providing suitable accommodations to the
employees also works as an effort to develop sound HR management in the
organization.
It is clear from the table that BHEL takes into consideration the arrangement of proper
accommodation to their employees as in most of the year number of house
constructed in township is changed in approximate proportion with the change in the
total number of employees in BHEL.
[165]
4.18 Representation of Employees of Reserved Categories i.e., Scheduled

Castes/ Scheduled Tribes and Other Backward Castes in BHEL
The implementation of reservation policies regarding employment and promotion at
every level of appointment i.e., at Managerial or Executive level, at Supervisory level
or at Non-Executive level could be analysed through the information collected from
the various reports of Public Enterprises Survey. The information has been arranged
in tabulation forms which are as follows:
Table 4.6: Representation of SCs, STs and OBCs in Group ‘A’

Managerial/Executives Level of BHEL
Group ‘A’ Managerial/Executives Level

Year
Total No. of Employees SCs STs OBCs
2010-11 13339 2023 787 1902
2011-12 13358 2095 813 2247
2012-13 13259 2102 877 2436
2013-14 13347 2252 957 2710
2014-15 12727 2159 921 2671
2015-16 12166 2094 898 2632
2016-17 11590 2012 883 2610
2017-18 10943 1932 866 2557
The table 4.6 depicts the representation of SCs/STs and OBCs at Group ‘A’ Level of
employees in BHEL. The employees of Managerial Level or Executive Level are
considered as the employees of Group ‘A’.
The table carries the total number of employees of Group ‘A’ in BHEL. On observing
the table, it is very clear that BHEL is maintaining the reasonable proportion of
SCs/STs and OBCs on their employees of Group ‘A’ Level.
[166]
Table 4.7: Representations of SCs, STs and OBCs in Group ‘B’ Supervisory Level
of BHEL
Group ‘B’ Supervisory Level
Year
2010-11 11057 1862 251 681
2011-12 10849 1753 301 886
2012-13 9371 1596 387 1489
2013-14 8974 1669 488 1916
2014-15 8519 1596 493 1896
2015-16 8041 1534 506 1864
2016-17 7645 1464 497 1857
2017-18 7285 1398 497 1852
The table 4.7 depicts the representation of SCs/STs and OBCs at Group ‘B’ Level of
employees in BHEL. The employees of Supervisory Level are considered as the
employees of Group ‘B’.
The table carries the total number of employees of Group ‘B’ in BHEL. On observing
the table, it is very clear that BHEL is maintaining the reasonable proportion of
SCs/STs and OBCs on their employees of Group ‘B’ Level.
Table 4.8: Representations of SCs, STs and OBCs in Group ‘C’ Workers (Skilled)
of BHEL
Group ‘C’ Workers (Skilled)
Year
2010-11 19591 4564 1376 5284
2011-12 20486 4861 1411 5953
2012-13 21847 5153 1419 6744
2013-14 23599 5248 1427 7859
2014-15 22067 5010 1386 7964
2015-16 20909 4593 1299 7663
2016-17 19617 4298 1240 7564
2017-18 18595 4169 1218 7519
[167]
The table 4.8 depicts the representation of SCs/STs and OBCs at Group ‘C’ Level of
employees. The skilled workers of PSEs are considered as the employees of Group
‘C’.
The table carries the total number of employees of Group ‘C’ in BHEL. On observing
the table, it is very clear that in most of the year representation SCs /STs and OBCs in
total number skilled workers is increasing. This may have two reasons; first,
applicants of reserved categories who applied for the recruitment are more competent
in terms of Educational Qualifications as well as in terms of Working Experience.
Secondly, it may be the consequent of the policy of No-Interviews at Group ‘C’ Level
of employees being followed by most of the PSEs.
Table 4.9: Representation of SCs, STs and OBCs in Group ‘D’ Workers (Un-
Skilled) of BHEL
Group ‘D’ Workers (Un-Skilled)

Year
2010-11 1233 297 37 423
2011-12 1382 293 35 389
2012-13 1493 289 34 301
2013-14 1605 288 33 296
2014-15 1592 196 12 165
2015-16 1082 266 28 552
2016-17 969 240 24 317
2017-18 717 115 8 172
The table 4.9 depicts the representation of SCs/STs and OBCs at Group ‘D’ Level of
employees. The unskilled workers of PSEs are considered as the employees of Group
‘D’.
The table carries the total number of employees of Group ‘D’ in BHEL. On observing
the table, it is very clear that in most of the year representation SCs /STs and OBCs in
total number unskilled workers is increasing. This may have two reasons; first,
applicants of reserved categories who applied for the recruitment are more competent
[168]
in terms of Educational Qualifications. Secondly, it may be the consequent of the

policy of No-Interviews at Group ‘D’ Level of employees being followed by most of
the PSEs.
After analyzing the information shown by the above tables from table no. 4.6 to to
table no. 4.9, it can be said in conclusive form that in BHEL, reservation policies are
being strictly followed regarding the employment.
Table 4.10: Application of Value Addition for Employees Payment in BHEL (in
Crore)
Year Value Added Personnel Payment Portion for Employee Cost (%)
2004-05 3550 1651 46.51
2005-06 4748 1879 39.57
2006-07 6503 2451 37.69
2007-08 7908 3146 39.78
2008-09 9327 4113 44.10
2009-10 12326 5243 42.54
2010-11 15015 5410 36.03
2011-12 16619 5466 32.89
2012-13 16264 5753 35.37
2013-14 12064 4934 40.90
2014-15 8759 5450 62.22
2015-16 5027 5541 110.22
2016-17 5434 5380 99.01
Source: Various issues of Annual Reports of BHEL
The table shows the portion of profit applied for making personnel payment which are
in tunes of 40% up to 2013 and after that this percentage is increasing rapidly due to
fall in net value addition from 2014-15. The decrease in net value addition suggests
that the numbers of loss making enterprises are increasing. The highest percentage of
value addition used for personnel payment is in 2015-16 i.e., 110.22 %.
[169]
Table 4.11: Year wise Break up of Newly Appointed Employees by Direct

recruitment in BHEL
Group/As on A B C D Total
31.12.2001 40 5 26 0 71
31.12.2002 267 0 56 1 324
31.12.2003 162 0 240 3 405
31.12.2004 375 0 27 9 411
31.12.2005 105 0 686 0 791
31.12.2006 214 0 676 208 1098
31.12.2007 564 0 1665 0 2229
31.12.2008 1736 9 3550 9 5304
31.12.2009 549 37 1776 0 2362
31.12.2010 983 11 1833 49 2876
31.12.2011 1311 0 3233 9 4553
31.12.2012 1112 1 2925 97 4135
31.12.2013 353 0 1 0 354
31.12.2014 11 0 859 0 870
31.12.2015 4 1 4 1 10
31.12.2016 92 0 1 22 115
The above table depicts the total number of vacancies filled by direct recruitment with
their group wise bifurcation.
[170]
Table 4.12: Number of Reserved Vacancies in Direct Recruitment and Filled by

Members of Scheduled Castes and Scheduled Tribes
% age of Total No. of

Total No. of No. of Vacancies
Group Vacancies Filled by
Year Vacancies Filled by STs/SCs
of Post STs/SCs
filled
SC ST SC ST
A 40 8 5 20.00 12.50
B 5 1 0 20.00 -
2001 C 26 4 2 15.38 7.69
D 0 0 0 - -
Total 71 13 7 18.31 9.86
A 267 41 39 15.36 14.61
B 0 0 0 - -
2002 C 56 14 0 25.00 -
D 1 0 0 - -
Total 324 55 39 16.98 12.04
A 162 23 18 14.20 11.11
B 0 0 0 - -
2003 C 240 53 4 22.08 1.67
D 3 1 0 33.33 -
Total 405 77 22 19.01 5.43
A 375 59 25 15.73 6.67
B 0 0 0 - -
2004 C 27 5 1 18.52 3.70
D 9 5 0 55.56 -
Total 411 69 26 16.79 6.33
A 105 24 9 22.86 8.57
B 0 0 0 - -
2005 C 686 143 38 20.85 5.54
D 0 0 0 - -
Total 791 167 47 21.11 5.94
[171]
A 214 28 17 13.08 7.94

B 0 0 0 - -
2006 C 676 108 46 15.98 6.80
D 208 32 40 15.38 19.23
Total 1098 168 103 15.30 9.38
A 564 77 43 13.65 7.62
B 0 0 0 - -
2007 C 1665 315 141 18.92 8.47
D 0 0 0 - -
Total 2229 392 184 17.59 8.25
A 1736 296 132 17.05 7.60
B 9 1 0 11.11 -
2008 C 3550 701 213 19.75 6.00
D 9 5 0 55.56 -
Total 5304 1003 345 18.91 6.50
A 549 105 31 19.13 5.65
B 37 4 6 10.81 16.22
2009 C 1776 340 106 19.14 5.97
D 0 0 0 - -
Total 2362 449 143 19.01 6.05
A 983 147 67 14.95 6.82
B 11 1 0 9.09 -
2010 C 1833 329 163 17.95 8.89
D 49 8 0 16.33 -
Total 2876 485 230 16.86 8.00
A 1311 201 96 15.33 7.32
B 0 0 0 - -
2011 C 3233 646 214 19.98 6.62

D 9 5 0 55.56 -
Total 4553 852 310 18.71 6.81
[172]
A 1112 163 83 14.66 7.46

B 1 1 0 100.00 -
2012 C 2925 601 156 20.55 5.33
D 97 23 2 23.71 2.06
Total 4135 788 241 19.06 5.83
A 353 53 25 15.01 7.08
B 0 0 0 - -
2013 C 1 0 0 - -
D 0 0 0 - -
Total 354 53 25 14.97 7.06
A 11 2 1 18.18 9.09
B 0 0 0 - -
2014 C 859 158 54 18.39 6.29
D 0 0 0 - -
Total 870 160 55 18.39 6.32
A 4 1 0 25.00 -
B 1 0 0 - -
2015 C 4 1 0 25.00 -
D 1 0 0 - -
Total 10 2 0 20.00 -
A 92 14 3 15.22 3.26
B 0 0 0 - -
2016 C 1 0 0 - -
D 22 2 0 9.09 -
Total 115 16 3 13.91 2.61
The above table reflects the number of reserved vacancies in direct recruitment and
filled by members of scheduled castes and scheduled tribes. It suggests that in most of
the years the percentage of total vacancies filled by SCs and STs is close to the
percentage determined by government for them i.e., 15 % and 7.5 % respectively.
[173]
4.19 Summing Up
Today, HR Management has developed into a major function with a broad spectrum
of activates concerned with human resources of the organization. Taking into account
the rapid expansion of the public sector in the country, several experiments are being
made in the field of HR Management. But even today, the Government has not been
able to decide a clear out policy on managerial personnel for public sector
undertakings. The personnel activities in BHEL are performed both at the corporate
and unit level. It is based on centralized policy making and decentralized
administration of Human Resource Management. The computer are being
increasingly made use of in personnel activities of the enterprise both at corporate and
unit level. Another important feature of most of the BHEL Units; the HR
Management undertakes its activities with full cooperation and support of top
management which is very necessary for the success of any organization to achieve its
objectives. Another important observation of the study is concerned with the
industrial relations machinery. It was found that the present existing machinery is
more effective in dealing with employees grievance as a result it achieved the support
of both management and workers representatives.
Out of the 16 registered trade unions in two units, tow trade unions are recognized. In
spite of a number of trade unions are recognized. In spite of a number of trade unions
operating, it is found that the inter-union rivalry is negligible. This chapter has also
brought out various agreements reached between the trade unions and management
which in turn reveal the nature and types of problems that surfaced in the functioning
of BHEL over a period time.
The study highlighted the unique scheme of Joint Committee which has been
functioning very successfully in BHEL Labour-Management relations are is sought
through this device. Matters which have a direct bearing on employees working and
service conditions, welfare and safety measures - are considered and decided through
this forum. The variety of welfare measures – statutory and non-statutory are
discussed at length in this chapter. The Provident fund, gratuity, medical and public
health services in respect of statutory obligations and staff benefit fund, death relief
fund, Group Insurance Scheme, housing facilities, educational facilities and a host of
[174]
advance in the non-statutory sector are the prominent among various welfare measure.
Last but least, the organization for ensuring the safety of the workers is also dealt in
this chapter would like to make an attempt to undertake an in-depth study of industrial
relations in BHEL.

[175]

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Chapter 4

HUMAN RESOURCE MANAGEMENT IN

4.1 History of BHEL

1 Annual Report of BHEL, 2012-13

4.2 Decade-Wise Growth of BHEL

4.2.1 1970’s: Era of Strategic Planning and Management

ratings. It began transforming itself from the phase of production or operations

As mentioned in the Corporate Plan of transformation of BHEL from "Production

Further, the second-generation manufacturing units as Transformer Factory was set up

BHEL generating and transmission equipment including nuclear power generating

4.2.2 1980’s: Era of Market Orientation and Technological Advances

BHEL’s continuing thrust on technology absorption as well as assimilation resulted in

4.2.3 1990’s: Era of Resurgence, Ideation and Innovation

developing in-house capability for the manufacturing of key production inputs,

4.2.4 The New Millennium: Era of Competence Building

BHEL focused on manufacturing capacity expansion, innovation, as well as

4.2.5 Today: Creating BHEL of Tomorrow: Responsive, Robust and Rising

Leveraging BHEL’s glorious past, enviable strengths as well as contribution towards

4.3 Vision of BHEL

“A global engineering enterprise providing solutions for a better tomorrow.”3

4.4 Mission of BHEL

4.5 Location of Corporate Office of BHEL

4.6 Contact Detail of Some Corporate Leaders of BHEL5

4.6.1 Chairman & Managing Director

Dr. Nalin Shinghal

Chairman & Managing Director

Bharat Heavy Electricals Limited,

4.6.2 Board of Directors

Shri Amit Varadan

3 Annual Report of BHEL, 2017-18, p.29

Shri Desh Deepak Goel

Shri Ranjit Rae

Shri Rajesh Sharma

Shri Subodh Gupta

Lodhi Road, New Delhi-110003

Shri Manoj Kumar Varma

Shri Kamalesh Das

4.7 Major Highlights of BHEL

 Over 50 years of experience

 Consistent dividend paying company for last forty years

 Integrated power plant equipment manufacturer with capability to deliver

 Serving core sectors of industry viz. Power, Transmission, Industrials Systems

 17 manufacturing units + 2 repair units + 8 service centres

 About 40000 employees

 1 Subsidiary + 6 Joint Ventures

 About 17,000 MW contracted

 Executing 24 projects in 14 Countries

 178 GW capacity installed globally

 30,000+ AC machines supplied

 360+ Electric Locos supplied to Indian Railways & Other Industries

 560,000+ MVA transmission equipment supplied

 R&D Expenditure (>2.5% of Turnover) – one of the highest in Indian

 Filing patent / copyright applications regularly – total fillings of 3915 nos.

4.7.1 Business Offices

4.7.2 Manufacturing Units

4.7.3 Service Centres

 BHEL GE Gas Turbine Services Pvt. Ltd. (50%)

 NTPC – BHEL Power Projects Pvt. Ltd. (NBPPL) (50%)

 Raichur Power Corporation Limited (26%)

 Dada Dhuniwale Khandwa Power Limited (50%)

 Power Plant Performance Improvement Limited (50%)

 Latur Power Company Limited (50%)

 BHEL Electrical Machines Limited (51%)

4.9 Sector-wise Production Details of BHEL