Forms and Level of Workers Participation

Workers’ participation in management may take the form of ascending or descending participation. In ascending participation an opportunity is given to the workers to participate in the decision-making process at a higher level.

Forms of Workers’ Employees’ Participation in Management are:

(I) Works, Committee;

(II) Joint Management Councils;

(III) Joint Councils;

(IV) Shop Councils; and

(V) Unit Councils.

(I) Works’ Committees:

The Industrial Disputes Act, 1949 provides for the setting up of works, committees as a scheme of workers participation in management which consist of representatives of employers and employees. The Act provides for these bodies in every undertaking employing 100 or more workmen.

The aim of setting up of these bodies is to promote measures for maintaining harmonious relations in the work place and to sort out differences of opinion in respect of matters of common interest to employers and employees. The Bombay Industrial Relations Act, 1946 also provides for these bodies, but under the provisions of this Act they can be set up only in units which have a recognised union and they are called joint committees. The workers directly elect their representatives where there is no union.

Functions:

These works committees/joint committees are consultative bodies. Their functions include discussion of conditions of work like lighting, ventilation, temperature, sanitation etc., and amenities like water supply for drinking purposes, provision of canteens, medical services, safe working conditions, administration of welfare funds, educational and recreational activities, and encouragement of thrift and savings.

It shall be the duty of the works committee to promote measures for securing and preserving amity and good relations between the employers and workmen and to comment upon matters of their common interest or concern and endeavour to reconcile any material difference of opinion in respect of such matters.

Structure:

The works committees have, as office bearers, a President, a Vice-President, a Secretary and a Joint Secretary. The President is a nominee of the employer and the Vice- President is the Workers’ representative. The tenure of these bodies is two years. The total strength of these bodies should not exceed 20. The employees’ representatives have to be chosen by the employees.

These committees functioned actively in some organisations like Tata Iron and Steel Company, Indian Aluminium Works at Belur, and Hindustan Lever. In all these, the managements have evolved joint committees independently of the statutory requirements.

(II) Joint Management Councils (JMCs):

The Second Five Year Plan recommended the setting up of joint councils of management consisting of representatives of workers and management. The Government of India deputed a study group (1957) to study the schemes of workers’ participation in management in countries like U.K., France, Belgium and Yugoslavia.

The report of the study group was considered by the Indian Labour Conference (ILC) in its 15th session in 1957 and it made certain recommendations:

(1) That workers’ participation in management schemes should be set up in selected undertakings on a voluntary basis.

(2) A sub-committee consisting of representatives of employers, workers and government should be set up for considering the details of workers’ participation in management schemes. This Committee should select the undertakings where workers’ participation in management schemes would be introduced in the first stage on an experimental basis.

Objectives:

The objectives of Joint Management Councils are as follows:

(i) To increase the association of employers and employee thereby promoting cordial industrial relations;

(ii) To improve the operational efficiency of the workers;

(iii) To provide welfare facilities to them;

(iv) To educate workers so that they are well equipped to participate in these schemes; and

(v) To satisfy the psychological needs of workers.

A tripartite sub-committee was set up as per the recommendations of Indian Labour Conference which laid down certain criteria for selection of enterprises where the JMCs could be introduced.

They are:

(i) The unit must have 500 or more employees;

(ii) It should have a fair record of industrial relations;

(iii) It should have a well organised trade union;

(iv) The management and the workers should agree to establish JMCs.

(v) Employers (in case of private sector) should be members of the leading employers’ organisation; and

(vi) Trade unions should be affiliated to one of the Central federations.

It was observed by the sub-committee that if the workers and employers mutually agree they can set up JMCs even if these conditions are not met.

The sub-committee also made recommendations regarding their composition, procedure for nominating workers’ representatives, the membership of JMCs etc. The details of these aspects have to be worked out by the parties themselves. A draft model was drawn up regarding the establishment of JMCs. The sub-committee was later reconstituted as the “Committee on Labour- Management Co-operation” to advice on all matters pertaining to the Scheme.

Criteria for Selecting of Units for Setting up of JMCS:

The sub-committee of the Fifteenth Indian Labour Conference which selected 48 units for introduction of the scheme of joint management council had laid down the following criteria for selecting the units-

In private sector, the industries selected were cotton and jute textiles, engineering, chemicals, tobacco, paper, cement, mines and plantations.

In public sector, industries included railway workshops and yards, posts and telegraphs, ports, shipyards, transport workshops, mines, printing and electrical undertaking.

(i) The undertaking should have a well-established, strong trade union functioning.

(ii) There should be a readiness in the parties between employers’ and workers’ union to try out experiment in a spirit of willing co-operation.

(iii) The size of the undertaking should be at least 500 workers.

(iv) The employer in a private undertaking should be member of one of the leading employers’ organisation; and similarly the trade union be related to one of the central federations.

(v) The company should have a fair record of industrial relations.

Functions:

The following are the important functions of JMCs:

(i) To be consulted on matters like standing orders, retrenchment, rationalisation, closure, reduction of operations etc.

(ii) To receive information, to discuss and offer suggestions.

(iii) To shoulder administrative responsibilities like maintaining welfare measures, safety measure, training schemes, working hours, payment of rewards.

Employees’ Participation in Management Scheme of 1975:

Government of India on 30th October, 1975, announced a scheme of workers’ participation in management which consisted of establishment of Joint Councils and Shop Council as part of its 20 point economic programme. The scheme envisages for the establishment of joint councils and shop councils in manufacturing and mining industries employing 500 or more employees in public, private and cooperative sectors.

The scheme contemplated participation of workers in the decision-making process in the matters relating to production, productivity, absenteeism, safety measures, general discipline, working conditions and welfare, and over-all efficiency of the shop/department.

Important features of this new scheme are:

(1) All decisions of a Shop Council as well as of the Joint Council shall be on the edifice of the “Consensus and not by process of voting.”

(2) It is non-statutory like JMCs and there is a clear-cut function of these councils.

(3) “Consensus and time-bound implementation” are the tools for arriving at decisions. Thus, the scheme tries to eliminate the chances of direct interference by outside elements. The decisions are required to be implemented within one month.

(4) The scheme provides for participation of workers at the shop floor level; otherwise the framework is not materially different from that of WCs. and JMCs.

(5) It provides for a two-way communication and an exchange of information between the management and the workmen.

(6) The very change in the nomenclature of the scheme from participation of workers in management’ to that of participation of workers in industry’ makes it more acceptable to employees as the latter are likely to offset some of their misgivings and apprehensions caused by the former.

(7) The scheme hits at three principal objectives to which the reform of industrial democracy is directed, viz., recovery of individual human rights at the work place; consolidation of social and political freedom (to join a particular union of his own choice without any coercion); and the framing of new industrial system functionally suitable to the country’s economy.

(III) Joint Councils:

The joint councils are for the whole unit and its membership remains confined to those who are actually engaged in the organisation. The tenure of the joint councils is for two years. The Chief Executive of the unit becomes its Chairman. Workers’ members of the council nominate the Vice Chairman. The joint council appoints the Secretary. The Secretary is responsible for discharging the functions of the council.

The joint councils will meet once in four months, but the periodicity of the meeting varies from unit to unit, it may be once in a month, quarter etc. The decisions taken at the joint council meetings are by the process of consensus and the management shall implement the decisions within one month. The scheme was implemented by the major units of the central and State governments. The government enlarged the functions of the councils in 1976.

In every industrial unit employing 500 or more workers, there shall be a Joint Council for the whole unit.

The main features of the scheme of Joint Council may be as follows:

(i) Only such persons who are actually engaged in the unit shall be members of the joint council.

(ii) The council shall function for a period of two years.

(iii) The Chief Executive of the unit shall be the Chairman of the joint council and there shall be a Vice-Chairman who will be nominated by worker-members of the council.

(iv) The joint council shall appoint one of the members of the council as its Secretary. Necessary facilities for the efficient discharge of function by the Secretary shall be provided with the premises of the undertaking/establishment.

(v) The term of council once formed shall be for a period of two years; if, however, a member is nominated in the mid-term of the council to fill a casual vacancy, the member nominated to such a vacancy shall continue in office for the remaining period of the term of the council.

(vi) The joint council shall meet, at least, once in a quarter.

(vii) Every decision of the joint council shall be on the basis of consensus and not by a process of voting and shall be binding on employers and workmen and shall be implemented within one month unless otherwise stated in the decision itself.

Functions of Joint Council:

The joint council should deal with matters relating to:

(i) Optimum production, efficiency and fixation of productivity norms of man and machine for the unit as a whole.

(ii) Functions of a shop council which have a bearing on another shop or the unit as a whole.

(iii) Matters emanating from shop councils which remain unresolved.

(iv) Matters concerning the unit or the plant as a whole, the respect of production targets; more specifically, task assigned to a shop council at the shop/department levels but relevant to the unit as a whole will be taken up by the joint council.

(v) The development of skills of workmen and adequate facilities for training.

(vi) Awarding of rewards for valuable and creative suggestions received from the workers.

(vii) The preparation of schedules of working laws and of holidays.

(viii) Optimum use of raw materials and quality of finished products.

(ix) General health, welfare and safety measures for the unit of the plant.

(IV) Shop Councils:

The shop council represents each department or a shop in a unit. Each shop council will consist of an equal number of representatives of employers and workers. The employers’ representatives will be nominated by the management and must consist of persons from within the unit concerned.

The workers representative will be from among the workers of the department or shop concerned. The number of members of each council may be determined by the employers in consultation with the recognised union. The total number of members, however, may not generally exceed twelve.

The decisions of the shop council are to be taken on the basis of consensus but not by voting. Management has to implement the decisions within one month. The tenure of the shop council is for a period of two years. Members of the shop councils meet at least once in a month. Management nominates the Chairman at least once in a month. Management nominates the Chairman of the shop council whereas workers’ members of the council elect the Vice- chairman of the council.

The number of shop councils to be established in an organisation is determined by the employer in consultation with the recognised trade unions/workers of the organisation. The decisions of a shop council which have a bearing on another shop will be referred to joint council for consideration and approval.

Main Features:

The main features of the scheme of Participative Management through Shop Councils are as follows:

(i) In every industrial unit employing 500 or more workmen, the employer shall constitute a Shop Council for each department or shop or one council for more than one department or shop, considering the number of workmen employed in different departments or shops.

(ii) (a) Each council shall consist of an equal number of representatives of employers and workers.

(b) The employer’s representatives shall be nominated by the management and must consist of persons from the unit concerned.

(c) All the representatives of workmen shall be from amongst the workers actually engaged in the department of the shop concerned.

(iii) The employer shall decide in consultation with the recognised union or the various registered trade unions or with workers, as the case may be, in the manner best suited to local conditions, the number of shop councils and departments to be attached to each council of the undertaking or establishment.

(iv) The number of members of each council may be determined by the employer in consultation with the recognised union, registered unions or workers in the manner best suited to local conditions obtaining in the unit; the total number of members may not generally exceed

(v) All decisions of a shop council shall be on the basis of consensus and not by process of voting, provided that either party may refer the unsettled matters to the joint council for consideration.

(vi) Every decision of a shop council shall be implemented by the parties concerned within a period of one month unless otherwise stated in the decision itself and compliance report shall be submitted to the council.

(vii) Such decision of a shop council which have bearing on another shop, or the undertaking of establishment as a whole will be referred to the joint council for consideration and decision.

(viii) A shop council once formed shall function for a period of two years. Any member nominated or elected to the council in the mid-term to fill a casual vacancy shall continue to be a member of the council for the unexpired portion of the term of the council.

(ix) The council shall meet as frequently as in necessary and that at least once in a month.

(x) The chairman of the shop council shall be a nominee of the management; the worker members of the council shall elect a Vice-Chairman from amongst themselves.

Functions of the Shop Councils:

The shop councils should in the interest of increasing production, productivity and overall efficiency of the shop department attend to the following matters:

(i) Assist management in achieving monthly/yearly production targets.

(ii) Improvement of production, productivity and efficiency including elimination of wastage and optimum utilisation of machine capacity and manpower.

(iii) Specially identify areas of low productivity and take necessary corrective steps at shop level to eliminate relevant contributing factors.

(iv) To study absenteeism in the shop/departments and recommend steps to reduce them.

(v) Safety measures.

(vi) Assist in maintaining general discipline in the shop/department.

(vii) Physical conditions of working, such as lighting, ventilation, noise, dust, etc., and reduction on fatigue.

(viii) Welfare measures to be adopted for efficient running of the shop/department.

(ix) Ensure proper flow of adequate two-way communication between the management and the workers, particularly on matters relating to production schedules and progress in achieving the targets.

(V) Unit Councils:

Encouraged by the success of the scheme in manufacturing and mining units, a new scheme of workers’ participation in management in commercial and service organisation in the public sector, having large-scale public dealings, was announced on 5th January, 1977. The Scheme envisaged setting of Unit Councils in units employing at least 100 persons.

The organisations include hotels, restaurants, hospitals, air, sea, railway and road transport services, ports and docks, ration shops, schools research institutions, provident fund and pension organisations, municipal and milk distribution services, trust organisations, all financial institutions, banks, insurance companies, post and telegraph offices, Food Corporation, State Electricity Boards, Central Warehousing, State Warehousing Corporations, State Trading Corporation, Mines and Minerals Trading Corporation, irrigation systems, tourist organisations, establishment for public amusement and training organisations of the Central and State Governments.

The scheme provides for unit level councils. These councils are to eliminate factors which hamper operations and improve methods of operation.

The main functions of the councils include creation of conditions for achieving optimum efficiency, better customer service in areas where there is direct and immediate contact between the workers at the operational level and the consumer, higher productivity, the elimination of pilferage and all forms of corruption, and the institutions of rewards to be given to those with proven ability in these areas.

Main Features of the New Scheme:

The main features of the scheme of workers’ participation through unit level councils would be as follows:

(i) A unit level council consisting of the workers and management of the organisation/ service may be formed generally in each unit, employing 100 or more workers to discuss day-to-day problems and find solutions; but wherever necessary a composite council may be formed to serve more than one unit or a council may be formed department-wise to suit the particular needs of an organisation/service.

(ii) Every unit council shall consist of an equal number of representatives of the management and workers. The actual number of members should be determined by the management in consultation with the recognised union, registered unions or the workers in the manner best suited to the local conditions obtaining in a unit or an organisation, but their total number may not exceed.

It would be necessary to nominate suitable and experienced workers from various departments irrespective of their cadre, affiliation or status, and not trade union functionaries who may not be actually working in the unit.

(iii) The management’s representatives should be nominated by the management and should consist of persons from the unit concerned.

(iv) The management shall decide in consultation with the recognised union or the registered unions or the workers as the case may be in the manner best suited to local conditions.

The number of unit councils and the departments to be attached to each council of the organisation/service.

(v) All decisions of a unit council shall be on the basis of consensus and not by a process of voting, provided that either party may refer the unsettled matters to the joint council for consideration.

(vi) Every decisions of a unit council shall be implemented by the parties concerned within a month, unless otherwise stated in the decision itself.

(vii) The management shall make suitable arrangement for the recording and maintenance of minutes of the meetings and designate one of its representatives as a secretary for this purpose who shall also report the action taken on the decisions at subsequent meetings of the council.

(viii) Such decisions of a unit council, which have a bearing on another unit of the organisation/ service as a whole shall be referred to the joint council for consideration and decisions.

(ix) A unit council once formed shall function for a period of two years. Any member nominated or elected to the council in the mid-term to fill a casual vacancy shall continue to be a member of the council for the unexpired portion of the term of the council.

(x) The council shall meet as frequently as is necessary but at least once in a month.

(xi) The Chairman of the council shall be a nominee of the management. The worker members of the council shall elect a Vice-Chairman from amongst themselves.

Main Functions:

The main functions of the Unit Councils may be:

(i) To create conditions for achieving optimum efficiency, better customer service in areas where there is direct and immediate contact between workers at the operational level and the consumer, higher productivity and output including elimination of wastage and idle time and optimum utilization of manpower by joint involvement in improving the work system.

(ii) To identify areas of chronically bad, inadequate or inferior service and to take necessary corrective steps to eliminate the contributing factors to evolve improved methods of operation.

(iii) To study absenteeism and recommend steps to reduce it.

(iv) To eliminate pilferage and all forms of corruption and to institute a system of rewards for this purpose.

(v) The suggest improvements in physical conditions of working such as lighting, ventilation, dust, noise, cleanliness, internal layout, setting up of customers’ service points, etc.

(vi) To ensure proper flow of adequate two-way communication between the management and workers, particularly about matters relating to the service to be rendered, fixation by targets of output and progress in achieving these targets.

(vii) To recommend and improve safety, health and welfare measures for an efficient running of the unit.

(viii) To discuss any other matters which may have a bearing on the improvement of performance of the unit for ensuring better customer service.

Board Level Participation:

Various organisations provide for the employee participation at the board of directors level. Employees elect their representative to participate in the Boards. Government of India introduced a scheme for induction of employees’ representatives as a director of the Board.

Consequently, a number of public sector undertakings nominated employees’ representatives as a member of their boards. Employees welcomed this step while managements raised their doubts about the success of this scheme.

A number of multinational companies also introduced the concept of employees’ participation at the board level. This scheme would be achieve its purpose when the employees’ representatives are trained in management skills and the functions of boards.

Reasons for Slow Growth:

Various reasons have been assigned for the slow progress and unsatisfactory working of the scheme.

These include:

(i) The apathy and even hostility of the employers and the workers; the former looked upon the bipartite bodies (Works Committees and JMCs) as substitute of trade unions, while the latter considered them to be their rivals

(ii) Lack of a proper understanding between employers and employees of the concept, purposes and benefits of the scheme

(iii) Progressive employers, who have a long tradition of having a healthy system of communication and consultation with their employees, find the bodies to be superfluous

(iv) Workers indirectly participate in management through their representatives. Their latent abilities and qualities have, therefore, been largely unutilised;

(v) The existence of a number of joint bodies: Works committees, joint management councils, production committees, suggestion committees, canteen committees, safety committees, etc., has caused confusion and a duplication of effort as well as a waste of time and energy;

(vi) The absence of a strong trade union or the existence of more than one trade union and inter-union rivalry has made the working of the scheme somewhat difficult;

(vii) The absence of a proper education and training in the principles of human relations, co­operation and participation on the part of the workers’ representatives on these bodies;

(viii) Although the representatives of the central organisations supported the scheme of national conference and committee meetings, they have shown inadequate interest in making their affiliates enthusiastic about it. In undertaking in which employee-employer relations are not cordial and in which arrangements for works committees, grievance redressal procedure and a procedure for the recognition of a trade union are absent, the joint management councils cannot be expected to function satisfactorily;

(ix) Delay in implementing the suggestions and recommendations of these bodies often leads to the waning of the workers’ interest in such bodies;

(x) The joint management councils were created without the creation of a congenial and constructive climate for them, which would ensure that each party would trust the other and would respect its rights.

Level

(1) Informative Participation:

At the initial stage, participation generally takes the stage of informative and associative participation where members have the right to receive information and give opinion on matters of general economic importance.

(2) Consultative Participation:

The next level is the consultative participation where members share their views on matters affecting their welfare with the management. It involves a higher degree of sharing of views. But the management has the discretion to accept or not to accept the views and suggestions of the employees.

(3) Administrative Participation:

At the next higher level, it is administrative participation, which provides a greater degree of share in the authority and responsibility in the management functions.

(4) Decision Participation:

It is the highest level of participation where workers are given opportunity to take part in decision making power activities. As the name suggests, the decision-making power at this level is complete and the delegation of authority is maximum.

It is important to note that participation in management is generally taken to mean only a general consultation on matters concerning the safety, welfare etc., of the workers and nothing more. The ultimate responsibility is vested in the management.

All other matters like wages, bonus etc., are subjects of collective bargaining and are excluded from the preview of the workers participation schemes the world Individual grievances are also excluded from its scope.