Industrial relations Industrial Relations
• Multidisciplinary field that studies the employment relationship - include the relationships and interactions between employers and employees • Also called employment relations because of the importance of non-industrial employment relationships. • Studies and examine various employment situations - Covers all aspects of the employment relationship, including human resource management, employee relations, and unionmanagement (or labour) relations

Industrial relations
• Industrial progress is impossible without cooperation of labours and harmonious relationships. Therefore, it is necessary to create and maintain good relations between employees (labour) and employers (management). • “Industry” - “any productive activity in which an individual (or a group of individuals) is engaged”. • “relations” - “the relationships that exist within the industry between the employer and his workmen.”

Industrial relations & human relations
• Industrial relations deals with the study and practice of collective bargaining, trade unionism, and labourmanagement relations • Human resource management is a separate, largely distinct field that deals with nonunion employment relationships and the personnel practices and policies of employers.

Terms in industrial relations
Industry • Any systematic activity carried on by co-operation between an employer and his workmen for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes by investing a capital with a motive to make any gain or profit. • An industry is a whole range of activities that are carried on by an employer with the help of his employees and labours for production and distribution of goods to earn profits

Terms in industrial relations
Employer An employer can be defined as:a person or business that pays a wage or fixed payment to other person(s) in exchange for the services of such persons. • a person who directly engages a worker/employee in employment. • any person who employs, whether directly or through another person or agency, one or more employees in any scheduled employment in respect of which minimum rates of wages have been fixed.


These markets occur because different conditions characterize different geographical areas. • Collective agreements reached by these negotiations usually set out wage scales. • Interests of the employees are commonly presented by representatives of a trade union to which the employees belong. Scope of industrial relations The scope or industrial relations include the following: • Collective bargaining • Machinery for settlement of industrial disputes • Standing orders • Workers participation in management • Unfair labour practices Collective bargaining • Process of negotiations between employers and a group of employees aimed at reaching agreements that regulate working conditions. working hours. grievance mechanisms and rights to participate in workplace or company affairs 2 . training. piece-rates or time rate.3/31/2012 Terms in industrial relations Employee Employee is a person who is hired by another person or business for a wage or fixed payment in exchange for personal services and who does not provide the services as part of an independent business. health and safety. • A person who works for a public or private employer and receives remuneration in wages or salary by his employer while working on a commission basis. occupations. It acts as the external source from which organizations attract employees. • An employee is any individual employed by an employer. and professions at any given time. industries. overtime. • The Terms in industrial relations state of Employment being employed or having a job. Labourmarket The market in which workers compete for jobs and employers compete for workers.

to increase production. i. picketing or gheraos. • To work in the direction of establishing and maintaining industrial democracy. • High morale – Good industrial relations improve the morale of the employees. relations between industry and society. To increase the morale and discipline of workers. This means. i.3/31/2012 Industrial disputes • Defined as a conflict or difference of opinion between management and workers on the terms of employment • Disagreement between an employer and employees' representative. over pay and other working conditions and can result in industrial actions • When an industrial dispute occurs. To ensure better working conditions. • To ensure constructive contribution of trade unions. • The management may resort to lockouts while the workers may resort to strikes. To develop employees to adapt themselves for technological. 3 . relations between union and management. • Socialization of industries by making the state itself a major employer Main aspect of Industrial Relations • labour Relations. improved living and working conditions • To improve the economic conditions of workers in the existing state of industrial managements and political government. Significance of industrial relation The healthy industrial relations are key to the progress and success.e. • To safeguard the interest of workers and the management. Objectives of industrial relations The main of industrial relations system are:• To bring better understanding and cooperation between employers and workers. Disputes are reflections of the failure of basic human urges or motivations to secure adequate satisfaction or expression which are fully cured by good industrial relations. i. Objectives of industrial relations • Objectives of industrial relations Vesting of a proprietary interest of the workers in the industries in which they are employed • • • • • To ensure workers’ participation in decision-making. • Employer-employees relations. • To eliminate or minimize the number of strikes. • Reduction in Industrial Disputes – Good industrial relations reduce the industrial disputes. • To avoid industrial conflicts and to maintain harmonious relations. Employees work with great zeal with the feeling in mind that the interest of employer and employees is one and the same. continuous employment for all from manager to workers. social and economic changes. To make positive contributions for the economic development of the country. i.e. • Uninterrupted production – The most important benefit of industrial relations is that this ensures continuity of production. relations between various groups of workmen. • To establish and promote the growth of an industrial democracy based on labour partnership in the sharing of profits and of managerial decisions. living conditions and reasonable wages. relations between management and employees.e. that is the management and the workmen. • Promotions and development of healthy labour-managements relations. i. • Group relations. usually a trade union. both the parties. • Maintenance of industrial peace and avoidance of industrial strife • Development of true industrial Democracy. lockouts and gheraos by providing reasonable wages. • To establish a proper channel of communication between workers and management. • Community or Public relations.e. try to pressurize each other.e.

judges of labour court. It will help increase production. Desirability of associations of workers and managements with the Government while formulating and implementing policies relating to general economic and social measures affecting industrial relations. The industrial peace lies ultimately in a transformed outlook on the part of both. independently and with responsibility.. social security. grievance re-dressal machinery. • Reduced Wastage – Good industrial relations are maintained on the basis of cooperation and recognition of each other. organizations of protests through methods like revisions of existing rules. • • Causes of Poor Industrial Relations Mental inertia on the part of management and labour. To make positive contributions for the economic development of the country. • • • • • • • Factors of industrial relations Industrial Relations Machinery 3. regulations governing labour welfare. Developing proper communication system between management and employees. Desire on the part of the workers for higher bonus or DA and the corresponding desire of the employers to give as little as possible. dispute settlements machinery working of closed shops. Comprises of • Conciliation • Arbitration • Adjudication 4 . etc. health. Principle of Good Industrial Relations • • • The willingness and ability of management and trade unions to deal with the problems freely. regulations. tribunals and other organizations which have direct or indirect impact on the industrial relations systems. 2. Contents : Includes matter pertaining to employment conditions like pay. mediator/conciliators / arbitrator. leave with wages. unions federations or associations. 4. employers. shop stewards. Introducing a suitable system of employees education and training. trade unions.3/31/2012 Significance of industrial relation • Mental Revolution – The main object of industrial relation is a complete mental revolution of workers and employees. social and economic changes. Fair redressal of employee grievances by the management Providing satisfactory working conditions and payment of fair wage. living conditions and reasonable wages. 1. dismissals retirements etc. procedures. Recognition of collective bargaining. industrial relations officers/ manager. • • • • • Inadequate fixation of wage or wage structure. An intolerant attitude of contempt of contempt towards the workers on the part of management. hearing of labour courts. industrial relations. laws relating to such activities. Characters : It aims to study the role of workers unions and employers’ federations officials. discipline procedure. Unhealthy working conditions. Methods : Focus on collective bargaining. and safety disciplinary actions. workers’ participation in the Industrial Relation schemes. issues concerning with workers’ participation in management. To ensure better working conditions. layoff. collective bargaining. tribunals etc. Institution: It includes government. To develop employees to adapt themselves for technological. labour courts. policies. Lack of human relations skill on the part of supervisors and other managers. tribunal etc. government bodies. Factors of industrial relations •Industrial Relation encompasses all such factors that influence behavior of people at work. union reorganization. Indiscipline. hours of works.

interpreting issues.. • It is a settlement technique in which a third party reviews the case and imposes a decision that is legally binding for both sides • Arbitration is often used for the resolution of commercial disputes. Three types of disputes are resolved through adjudication: • Disputes between private parties. i. and peace between workers and • When workers participate in organizational decisions. by whose decision (the "award") they agree to be bound. such as individuals or corporations • Disputes between private parties and public officials • Disputes between public officials or public bodies What's the difference? The difference between arbitration and mediation • In mediation a neutral facilitator works with all parties to assist them to reach a solution. Worker Participation And Employee Involvement • The word ‘participation’ means sharing the decision-making power with the lower ranks of the organization in an appropriate manner. • has no legal standing. how their actions would contribute to overall growth of the company. who then meets with the parties separately in an attempt to resolve their differences. exploring potential solutions and bringing about a negotiated settlement. "arbiters" or "arbitral tribunal"). where the parties to a dispute refer it to one or more persons (the "arbitrators". Adjudication • legal process by which an arbiter or judge reviews evidence and argumentation including legal reasoning set forth by opposing parties or litigants to come to a decision which determines rights and obligations between the parties involved. where arbitration may be mandated by the terms of employment or commercial contracts. improving communications.3/31/2012 Conciliation • Alternative dispute resolution (ADR) process whereby the parties to a dispute (including future interest disputes) agree to utilize the services of a conciliator (mediator). particularly in the context of international commercial transactions • The use of arbitration is also frequently employed in consumer and employment matters. and the conciliator usually has no authority to seek evidence or call witnesses. • They do this by lowering tensions. is a legal technique for the resolution of disputes outside the courts. and makes no award. 5 .e. Arbitration is a formal process in which an independent third party hears from all parties and makes a decision about how to resolve the dispute. Arbitration is a more formal process. and the arbitrator's decision is legally binding. The difference between arbitration and adjudication • The aim of adjudication is to resolve disputed issues in order to enable work to continue (either indefinitely or while awaiting the decision of a judge or arbitrator). usually writes no decision. providing technical assistance. they are able to see the big picture clearly. Arbitration • A form of alternative dispute resolution (ADR). • Has a unique motivational power and a great psychological value • promotes harmony management.

• Political objective of participation is to develop workers conscious of their democratic rights on their work place and thus bring about industrial democracy. vii. To promote increased productivity for the advantage of the organization. workers and society at large. psychological. • Formal & informal participation The participation of workers may be formal or informal. Facilitate self-development of worker. Shop Councils. • participation includes the willingness to share the responsibility by works as they have a commitment to execute their decisions. and allotment of worked or transfer of workers from one department to another. To strengthen labour management co-operation and thus maintaining industrial peace and harmony. so that the management become “Auto Management”. To build the most dynamic human resource. xiv. An instrument for improving efficiency of the company and establishing harmonious industrial relations. departmental level or at the top level. Objectives of Workers’ Participation in Management vi. involvement and a feeling of belongingness.may be such as the supervisor consulting the workers for granting leave. ethical and political objectives. • Psychological objective . ii. Objectives of Workers’ Participation in Management The main objectives of workers’ participation in management include: i. v. the share-holders.to secure full recognition of the workers Association of worker with management provides him with a sense of importance. ix. • Ethical objective of participation is to develop workers free personality and to recognize human dignity. Safety Committee. Development of working class. and iv. To provide a better understanding to employees about their role and place in the process of attainment of organizational goals. Creation of a just egalitarian (equal) society. Formal participation . the community and the workers equally invested in it. Canteen Committee etc. iii. Development of human personality xii. To build the nation through entrepreneurship and economic development. xi. viii. • participation is conducted through the mechanism of forums which provide for association of workers representatives. Need for workers participation • Reduced industrial unrest • Reduced misunderstanding • Increased organization balance • Higher productivity • Increased Commitment • Industrial democracy • Less resistance to change Objectives of Workers’ Participation in Management The scheme has economic. To satisfy the workers’ social and esteem needs. • Socially. • participation may be at the shop level. xiii. overtime. 6 . the need for participation arises because modern industry is a social institution with the interest of employer.it takes the forms of formal structures such as Works Committee. Development of leader from within the industry. x. xv. • The basic idea is to develop self control and self discipline among works. An ideological point of view to develop self-management in industry. Joint Management Councils.3/31/2012 Worker Participation And Employee Involvement Workers’ participation in management encompasses the following: • Provides scope for employees in the decision making of the organisation. To develop social education for effective solidarity among the working community and for tapping latent human resources. • Informal participation. Production Committee. To improve the quality of working life by allowing the workers greater influence and involvement in work and the satisfaction obtained from work.

 Ensure complete sharing of information which shall ensure effective consultations and formation of policies. with emphasis on autonomy and satisfaction of higher needs of the workers.3/31/2012 Workers’ participation in management in India • Entered the Indian scene in the year.without any political forces and multiplicity in unions.  Creation of working environment conducive to participation . • The attitude of trade unions towards the schemes is negative as they consider these schemes are reducing the power of Trade Unions.  Rights of each other are recognized and protected by the presence of legal framework. demographic and representative unionnism. and must have full faith in the soundness of this concept.without much rigid hierarchical structure and close supervision. Suggestion to make WPM Schemes Successful in India • The success of any scheme of participative management is dependent on some of the basic points regarding work environment . thought is not used often. Suggestion to make WPM Schemes Successful in India  Formation of mutually agreed and clearly spelt objectives for participation. Suggestion to make WPM Schemes Successful in India  Both parties should develop their attitude and outlook. The preventatives of workers are not given due recognition by the management.which are as under:  There should be a strong. when Mahatma Gandhi had suggested that workers should participate and contribute to the organization and also share its prosperity. The factors responsible for the failure are: • Attitude of the management towards the scheme is not encouraging. Workers’ participation in management in India The various forms of workers’ participation in management currently prevalent in the country are: 1) Works Committee 2) Joint Management Councils (JMCs 1958) 3) Joint Councils 4) Unit councils 5) Plant Council (6) Shop Councils (7) Workers’ Representation on Board of Management (8) Workers’ Participation in Share Capital Workers’ Participation in Management in India • Even after taking all these initiatives. 7 . WPM in India was a failure. 1920. Some Trade Unions boycott Joint Management Council meetings.

New welfare measures are added to the existing ones from time to time. • The purpose of labour welfare is to bring about the development of the whole personality of the workers to make a better workforce. Workers take active interest in their jobs and work with a feeling of involvement and participation. cultural and material conditions of living of the workers. enacted a number of laws and has introduced and implemented many schemes to provide social security to industrial workers. Social security programmes include – • Medicare and insurance benefits • Medical help at the time of injury and accident and provision financial compensation and relief. etc are reduced to a greater extent by the welfare policies. employees or by any social or charitable agency. government. This makes workers to pay more attention towards work and thus increases their productivity. • Employers get stable labour force by providing welfare facilities. services and amenities provided to workers for improving their health. • Welfare measures may be introduced by the employers.. • The social evils prevalent among the labours such as substance abuse. • After independence. sickness. disablement. • Welfare measures are in addition to regular wages and other economic benefits available to workers due to legal provisions and collective bargaining • Labour welfare schemes are flexible and ever-changing. old age or other contingencies.3/31/2012 Labour welfare • Involves all those activities of employer which are directed towards providing the employees with certain facilities and services in addition to wages or salaries. medical benefits. efficiency. and education and recreation facilities for workers’ families help in raising their standards of living. Labour welfare labour welfare includes various facilities. • Employee welfare measures increase the productivity of organization and promote healthy industrial relations thereby maintaining industrial peace. a beginning was made in social security with the passing of the Workmen’s Compensation Act. Social Security Programmes in India • In pre-independence period. Labour welfare The important benefits of welfare measures can be summarized as follows: • They provide better physical and mental health to workers and thus promote a healthy work environment • Facilities like housing schemes. economic betterment and social status. industrial accidents. Social security System of protection or support provided by the society or government to workers and their families in time of sudden calamity. injuries. Labour welfare has the following objectives: • To provide better life and health to the workers • To make the workers happy and satisfied • To relieve workers from industrial fatigue and to improve intellectual. unemployment. 1923. • Pension in case of disablement • Unemployment insurance or allowance • Maternity benefits • Death payments and family pension • Retirement benefits or old age relief etc. 8 .

1924 -provided for payment of compensation to workmen and their dependents in case of injury. provides for the fixation of minimum rates of wages by the Central or State governments within a specified period for workers employed in certain scheduled employments Industrial safety • Factories act 1948 caters for the industrial safety of the worker • The Act has been enacted primarily with the object of protecting workers employed in factories against industrial and occupational hazards. hours of work for adults and children. a piece of social legislation. leave with wages etc. 1923 . disablement benefit. • The Contract Labour (Regulation and Abolition) Act of 1970. plantations. written permission of the government is required along with relevant particulars of the industry. • Payment of Gratuity Act. 9 . welfare. dependants’ benefit. • The Employees’ Provident Funds and Miscellaneous Provisions Act. safety. 1961. 1948.provide a scheme for the payment of gratuity to employees employed in factories. 41 and 43. the employer has to ensure safety and security of his employees. employment of young persons and women.should enhance the well being of employees and thus should be accident free A construction worker hanging in the rope without any protection at a construction site in Chennai. and medical benefit.became effective from July 1. (5) funeral benefit. 1948. 39. accident and some occupational diseases arising our of and in the course of employment and resulting in disablement and death. provides for the abolition of contract labour wherever possible and to regulate the conditions of contract labour in establishments or employments • The Minimum Wages Act. 1948 provided sickness benefit and extended sickness benefit. INDUSTRIAL SAFETY & WELFARE PROVISION Industrial safety Main features of act are: • Before starting any industry. • Health and safety form an integral part of work environment. maternity benefit. • The Employees’ State Insurance Act. oil fields. are also social security measures • Workmen’s compensation act. Children shall not be employed in big or dangerous machines Employee Health and Safety • For smooth functioning of an organization. holidays.(at least 15 days notice is required) • Complete security arrangements shall be made. mines. 1972 .. 1952 and the Maternity Benefit Act. shops and establishments Social security • The Factories Act.3/31/2012 Social security Social security is guaranteed in our Constitution under Acts. ports. railways. provides for health.

• • • • welfare provisions 10 . vibrations and shocks or atmospheric conditions such as inadequate ventilation. and • Environmental factors including illness due to radiation. especially factories. • Biological factors including sickness caused by bacteria. Canteen facilities: Cafeteria or canteens are to be provided by the employer so as to provide hygienic and nutritious food to the employees. sulphuric acid. cancer and neurological disorders they may shorten life expectancy. Facilities for sitting: In every organization. (ii) Fostering the adaptation of workers to the jobs and work environment and thus contributing towards the employees’ physical as well as mental adjustments. and (iii) Promoting the establishment and maintenance of the highest possible degree of physical mental and social wellbeing of the workers. lighting arrangement or very high or low temperature at the work place. noise. Employee Health and Safety Normal health hazards may be caused by• Chemical substances at the work place such as carbon monoxide. fungi.3/31/2012 Employee Health and Safety Industrial safety and health may comprise measures for : (i) Protecting the workers/employees against any health hazards arising our of their work or the condition under which it is carried on. suitable seating arrangements are to be provided. allergies. dietary deficiencies. anxiety etc. First aid appliances: First aid appliances are to be provided and should be readily assessable so that in case of any minor accident initial medication can be provided to the needed employee. sulphur dioxide. Employee Welfare Schemes • The statutory welfare schemes include the following provisions: Drinking Water: At all the working places safe hygienic drinking water should be provided. . emotional strains due to fear. Latrines and Urinals: A sufficient number of latrines and urinals are to be provided in the office and factory premises and are also to be maintained in a neat and clean condition. viruses.Inhaling causes respiratory or heart diseases. carbon dioxide. acetic acid etc.

Employee Welfare Schemes Many non statutory welfare schemes may include the following schemes: • Personal Health Care (Regular medical check-ups): Some of the companies provide the facility for extensive health check-up • Flexi-time: The main objective of the flextime policy is to provide opportunity to employees to work with flexible working schedules. bathrooms. • The object of legislation is : • the equitable distribution of profits and benefits adding from industry between industrialists and workers • affording protection to the workers against harmful affects to their health safety and morality Principles of Labour Legislation : There are four principles on which the labour legislation is based viz. • Medi-claim Insurance Scheme: This insurance scheme provides adequate insurance coverage of employees for expenses related to hospitalization due to illness. • Social Justice • Economic Justice • National economy • International conventions 11 . • Maternity & Adoption Leave – Employees can avail maternity or adoption leaves. etc. • • A spittoon (or spittoon) is a container made for spitting into. disease or injury or pregnancy. Changing rooms: Adequate changing rooms are to be provided for workers to change their cloth in the factory area and office premises. • Employee Referral Scheme: In several companies employee referral scheme is implemented to encourage employees to refer friends and relatives for employment in the organization. in the dock area and office premises spittoons are to be provided in convenient places and same are to be maintained in a hygienic condition. store places. guidelines are provided for proper action and also for protecting the aggrieved employee. Washing places: Adequate washing places such as bathrooms. Adequate lockers are also provided to the workers to keep their clothes and belongings. • The evils of industrialization have led to the labour legislation. Paternity leave policies have also been introduced by various companies. wash basins. Lighting: Proper and sufficient lights are to be provided for employees so that they can work safely during the night shifts. such as ware houses. Rest rooms: Adequate numbers of restrooms are provided to the workers with provisions of water supply. wash basins with tap and tap on the stand pipe are provided in the port area in the vicinity of the work places. especially by users of chewing and dipping tobacco welfare provisions welfare provisions Employee Welfare Schemes • Harassment Policy: To protect an employee from harassments of any kind. Flexible work schedules are initiated by employees and approved by management to meet business commitments while supporting employee personal life needs • Employee Assistance Programs: Various assistant programs are arranged like external counseling service so that employees or members of their immediate family can get counseling on various matters. Labour Legislation in India • Labour Legislation refers to all laws of the Government which have been enacted to provide social and economic security to the labour or workers. Now the state has a direct interest in the industrial peace and prosperity • These acts are aimed at reduction of production losses due to industrial disputes and to ensure timely payment of wages and other minimum amenities of the workers welfare provisions Need of labour Legislation • The basic principle of industrial legislation is to ensure social justice to the workers . toilets.3/31/2012 Employee Welfare Schemes • • • Spittoons: In every work place.

medical expenses. etc. light vehicle charges. 1948 • Provides for certain benefits to employees in case of sickness. 12 . 1923 • The Workmen’s Compensation Act. (5) funeral benefit. (4) dependents' benefit. 1948 • The benefits provided to the employees under the scheme are: (1) sickness benefit and extended sickness benefit. Conditions of work. trade unions. The administration of labour law. 3) Payment of Wages Act. All the benefits are provided in cash 2) Workmen’s compensation Act. (2) maternity benefit. • Includes social security and disability insurance as well • • • • • • • • Elements of labour law The basic subject matter of labour law can be considered under nine broad heads: Employment. remuneration. 1936 • To ensure regular and prompt payment of wages and to prevent the exploitation of a wage earner by prohibiting arbitrary fines and deductions from his wages. and welfare. health. but do not include house rent reimbursement. and industrial relations. • It provides for payment by certain classes of employers to their workmen compensation for injury by accident. bonus. maternity and employment injury. • It applies to all factories employing ten or more persons and carrying on a manufacturing process with the aid of power or employing 20 or more persons and carrying on a manufacturing process without the aid of power Employees’ State Insurance (ESI) Act. Individual employment relationships Wages and remuneration. Special provisions for particular occupational or other groups 1) Employees’ State Insurance (ESI) Act. aims to provide workmen and/or their dependents some relief in case of accidents arising out of and in the course of employment and causing either death or disablement of workmen. and (6) medical benefit. (3) disablement benefit. or sums payable for termination of service. TA.3/31/2012 Labour laws • Varied body of law applied to such matters as employment. conditions of work. • Applicable for payment of wages to persons employed in any factory. safety. Social security Trade unions and industrial relations. • Wages include all remuneration.

creation of industrial harmony through infrastructure for health. • Aims at making provisions for the statutory fixation for the minimum rate of wages in number of industries where there are extensive chances for the exploitation of labour Role of state in labour welfare • The improvement of labour welfare and increasing productivity with reasonable level of social security is one of the prime objectives concerning social and economic policy of the Government. accident and unemployment for the workers and then families. • The resources have been directed through the Plan programmes towards skill formation and development. Role of state in labour welfare • Various welfare measures adopted by the state are: • • • • • • Factories act 1948 Trade union act Payment of wages act Minimum wages act Workmen compensation act Contract labour act Role of labour welfare officer Labour welfare officer is appointed as per the requirement of section 49 of the Factories Act • 1) To act as a negotiating officer 2) To shape and formulate labour policies 3) To establish contact 4) To deal with wages and employment 5) To prevent from anti social activities 6) To bring about peaceful settlement 7) To comply with provision of factory to promote relation between the factory and workers 9) To encourage formation of committees 10) To secure provision of amenities 11) To help factory management in regulation of Leave 12) To secure welfare provisions 13) To advice factory management 13 .3/31/2012 4) Minimum wages Act. monitoring of working conditions. 1948 • The Minimum wages Act of 1948 was passed for the welfare of labour and provided for fixing the minimum rate of wages of labour. industrial relations and insurance against disease.

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