Tag: Performance Management & Career Planning Mumbai University BMS Notes

The areas of an individual’s rights and responsibilities depend on his relation with those around him. One belongs to a family. His first and strongest relation, in the normal circumstance, is therefore with members of his family. Then comes his work place, the society around him, the state, his professional and religious group, etc.

In his relation with his family, he has certain rights and responsibilities. Maybe he is a husband and a father. He fulfills his responsibilities and in turn exercises his rights. Similar is the case with other groups as well. The differences are in the manner in which they are established and exercised and also the degree.

Trade unions, unlike a yogi, do not live in isolation. Like family people, they interact with others around. They interact with their members as individuals do with their family members and other social groups. They interact with definite motives, in establishment of a relationship. And such a relationship in turn establishes rights and responsibilities.

The primary objective of trade unions is the welfare of their members. This is achieved by protection and promotion of workers’ interest. In this objective fulfillment, the unions interact with employers, Government, apex bodies, sister organizations, rivals, etc. In this interaction, the unions develop certain relationships, both positive and negative. The State at times interferes and regulates the relationship. The union rights and responsibilities flow from such relationships and State regulations.

The major areas of the union rights and responsibilities can be classified as:

1. In relation to members
2. In relation to employers
3. In relation to Government

Rights and Responsibilities in Relation to their Members:

1. To prescribe membership qualification, admission fee and membership fee. This is normally taken care of in the constitution of the unions.
2. To admit or refuse to admit workers who have applied for membership. The union is not bound to accept any or all those who apply for membership. It reserves the right to exercise its discretion in admission of members.
3. To make working rules and procedure for day-to-day work.
4. To take functional and administrative decisions in day-to-day work of the union.
5. To collect and administer the union fund.
6. To demand loyalty and support from members. The strength of any union depends on its membership, which supports the union in its work.
7. To discipline the members in their relations with the unions and personal life. The unions can take disciplinary action against those members who violate the union rules.
8. To act as legal representative of their members in matters of unions’ own affairs and those related to labour-management relations.

Responsibilities towards Members:

• To conduct election of office bearers and organizational meetings as provided in the constitution of the union.
• To function democratically. This means to function according to the majority’s wishes and as per the constitution of the union.
• To collect union revenues, and meet expenditure as per sanctioned budget.
• To refrain from compelling any members to contribute towards the political fund, if kept.
• To exercise no discrimination between those who subscribe to the political fund and those who do not in their trade union rights.
• To account to the members of the union fund.
• To keep open the records of the union for the benefit of the members if they choose to see them.
• To strive for objective fulfillment of the union. This may be to protect the workers from victimization, low wage payment, irregular wage payment, etc., to promote working and service conditions, i.e. gradually improve the physical environment of the working place, shorter hours of work, longer leave, more wages and fringe benefits, bonus, etc. This in short is collective bargaining.
• To take up individual and collective grievances of members with the management for removal of the same within the agreed working and service conditions. While individual aggrieved workers can singly take up such cases with the management at the initial stage of grievance procedure, the union has a responsibility to involve itself at higher stages, if the grievances are not solved to the satisfaction of the aggrieved workmen.
• To act as the legal representative of the workmen and to enter into agreement with others in defence or promotion of members’ interest. Keep the members intimated of union activities by circular, meetings, etc.

Responsibilities towards the Employer:

• To intimate to the employer the union’s address, names of office bearers and affiliation, if any, and membership strength.
• To supply to the employer a copy of the constitution.
• To intimate to the employer the amendments in the constitution of the union and changes in office bearers, affiliation, etc.
• To intimate to the employer the name of protected workmen.
• To make commitment on behalf of workers and enter into agreement with the employer.
• To try all means for peaceful settlement of disputes before resorting to direct action.
• To take ballot or otherwise know the mind of the members before resorting to strike.
• To give notice of strike before going on strike. This is a legal requirement in public utility service.
• To advise the essential services like firefighting squad, watch and ward, etc. to be on duty even when a general strike is held.
• To honour the agreements, awards, conventions and established practices.
• To represent the grievances of workers to the proper authority designated and in time.
• To co-operate with the employer in the formation and working of:

(i) Works Committee

(ii) Production Committee

(iii) Grievance Committee

(iv) Joint Management Council

(v) Canteen Committee

(vi) Welfare Committee

• To co-operate with management in maintaining discipline in plant life.
• To co-operate with management to increase productivity.

Rights and Responsibilities in Relation to Government:

Labour is a Concurrent subject. This means that both the Central and State Governments have jurisdiction in the subject. However, in certain industries the Central Government enjoys the exclusive right. Oil and oilfields, civil aviation, railways, port and docks, banks, mines and quarries are some examples.

Certain other industries fall under the State Government jurisdiction. But here again certain areas are carved out for the Central Government. Provident Funds, Employees State Insurance Scheme, Wage Boards are examples.

They are so for administrative convenience as well as for uniformity. The rights and responsibilities of trade unions in relation to Government therefore are meant both for Central and State Governments. The rights are conferred and the responsibilities imposed more by legislations and by administrative orders.

The Rights are:

• To register trade unions. By registration a union becomes a corporate body.
• To sue and to be sued in the registered name. A union acquires this right only on registration.
• Immunity from criminal conspiracy. The trade union on registration becomes immune from any charges of criminal conspiracy as well as civil suit.
• To acquire movable and immovable property.
• To have outsiders also as office bearers of unions.
• To receive a copy of draft standing orders submitted by the employer to the certifying authority.
• To suggest modifications to draft standing orders.
• To appeal against the provisions of certified standing orders.
• To suggest amendment to standing orders on expiry of six months from its certification.
• To represent the workmen before Labour Courts, Industrial Tribunal and appellate judicial authorities.
• To represent the union by an officer of a federation of unions.
• To declare protected workmen.
• To represent for recognition of union.
• For enforceability of agreements and awards, Wage Board recommendations and tripartite conclusions.
• Interference of Government industrial relations machinery in case of public utility services.
• To request the Government for adjudication of industrial disputes.
• To cross-examine the employer’s witnesses in industrial adjudication.

1. Conventions/sessions
2. General council (President, VP, Secretary-General, etc.)
3. Provincial bodies (at state level chairman, secretariats)
4. Local bodies (affiliated unions)

National convention/conferences are hold at periodic intervals, say annually or bi-annually. This is the highest policy­making body. This is presided over by the president of the union attended by the delegates such as chairmen of state units, representatives of specialized services, legal experts and delegates from international bodies and special invitees. Office bearers are also elected by this conference.

General council consists of president, vice-president, secretary and other office bearers. It carries out policy decisions taken by convention. Various standing committees are set up on rendering study, analysis and recommendations on various aspects like legislative measure, Research and publications, international services etc.

State units are headed by chairman of state/regional areas. State units also liaise with National Headquarters; keep a close watch of faithful implementation of labour legislation and practices. It assists/influence state government to pass labour friendly legislation and executive/administration actions.

It is also responsible for membership of various unions representing workers in industrial undertakings (units) and/or representing trade and industrial units affiliated to the central trade union. These state units get themselves attached to State/Provincial/HQ/Regional unions/Units.

Headquarters (HQ) unions are responsible for welfare of its members and membership drive. As bargaining agents they are involved in collective bargaining with Central Government/ and or State government and assist passing legislative measures.

Objectives:

(i) The organisation of a trade union on the basis of the craft or industry in which its members are employed, such as general unions and professional employee’s organisations.

(ii) Collective bargaining, which is the essence of industrial relations, for it is through collective bargaining that the terms and conditions of employment are determined and under which work is performed’ satisfactorily.

(iii) Grievance processing and handling procedures, under which grievances are redressed or dealt with by a correction of situation or by channelling up of these “up the line”.

(iv) Arbitration, by which unsettled or unresolved disputes can be settled by an outside agency.

(v) Political pressure exercised through legislators who are capable of bringing about changes in labour laws; and

(vi) Mutual insurance through common contributions to meet the financial needs of workers when there are stoppages of work.

Characteristics of Trade Union:

• A union normally represents members in many companies throughout the industry or occupation.
• A union is fundamentally an employer regulating device. It sharpens management efficiency and performance while protecting the interests of the members.
• A union is a part of the working class movement.
• A union is a pressure organisation originating in the desire on the part of a group with relatively little power to influence the action of a group with relatively more power.
• A union is a political institution in its internal structure and procedures.

Good industrial relations depend on the co-operative and constructive attitude from both part as management & union. Still there exist some certain conditions/principles/essentials that helps to maintain harmonious industrial relations:

Mutual and Voluntary Negotiations:

The relationship between an employee and the employer will be congenial only, where the difference between them are settled through mutual negotiations and consultations. Collective beginning is a process, through which employee issues are settled, through mutual discussions and negotiations, through a give and take approach.

Efficient management:

To reduce disputes & other conflicts, efficient management helps to maintain good IR.

Existence of Organised Employers Unions:

These associations are helpful for the promotion and maintenance of uniform personnel policies, among various organisations and to protect the interest of weak-employers.

Proper democratic environment:

Proper democratic environment in any enterprise is essential in order to maintain a sound IR.

Existence of Democratic Employee is Unions:

Industrial, relations are sound only when the bargaining power of the employees’ unions, is equal to that of management

Existence of strong, organized trade unions:

Sound IR requires equality of bargaining power of the workers’ union & management. A strong trade union can protect the workers’ interests relating to wage, job security etc.

Existence of sound, organized employers’ unions

All organizations within industry must follow identical policy, rules and regulation in order to maintain a sound IR.

Spirit of collective bargaining:

Collective bargaining means, negotiation between an employer and a labor union usually on wages, hours, and working conditions. Here it means both parties must consider each other for removing conflict.

IR is dynamic in nature. The nature of IR can be seen as an outcome of complex set of transactions among the major players such as the employers, the employees, the trade union, and the state in a given socio-economic context. In a sense, change in the nature of IR has become sine quo non with change in the socio-economic context of a country.

During this period the industry (both employees and employers) faced severe problems like:

• Poor working condition
• Poor wages
• Absence of job security
• Absence of welfare activities
• Employee’s strike
• Low productivity
• Long working hours
• Absence of skilled labour

Keeping this fact in view, IR in India is presented under the following two sections:

1. IR during Pre- Independence
2. IR during Post-Independence

1. IR During Pre-Independence:

The structure of the colonial economy, the labour policies of colonial government, the ideological composition of the political leadership, the dynamics of political struggle for independence, all these shaped the colonial model of industrial relations in pre-independent India”. Then even union movement was an important part of the independence movement.

However, the colonial dynamics of the union movement along with the aggressiveness of alien capital, the ambivalence of the native capital and the experience of the outside political leadership frustrated the process of building up of industrial relations institutions. Other factors like the ideology of Gandhian class harmony, late entry of leftists and the bourgeois character of congress also weakened the class approach to the Indian society and industrial conflict”.

Till the Second World War, the attitude of the colonial government toward industrial relations was a passive regulator only Because, it could provide, that too only after due pressure, the —um of protective and regulative legal framework for industrial relations Trade Union Act 1926 (TL A) Trade Disputes Act 1929 (TDA). It was the economic emergence of the Second World War that altered the colonial government’s attitude on industrial relations.

The state intervention began in the form of introduction of several war time measures, viz. the Defense of India Rules (Rule 81- A), National Service (Technical Personnel) Ordinance, and the Essential Service (Maintenance) Ordinance As such in a marked contrast to its earlier stance, the colonial government imposed extensive and pervasive controls on industrial relations by the closing years of its era-. Statutory regulation of industrial relations was on plank of its labour policy. The joint consultative institutions were established primarily to arrive at uniform and agreeable labour policy.

The salient features of the colonial model of IR can be summarized as close association between political and trade union movement, dominance of ‘outsiders’ in the union movement, state intervention and federal and tripartite consultations.

The eve of Independence witnessed several instances that served as threshold plank for IR during post Independence era. The prominent instances to mention are passing of Indian Trade Unions (Amendment) Act, 1947, Industrial Employment (Standing Orders) Act 1946, Bombay Industrial Relations Act, 1946, and Industrial Disputes Act, 1947 and split in AITUC and formation of INTUC.

2. IR During Post-Independence:

Though Independent India got an opportunity to restructure the industrial relations system the colonial model of IR remained in practice for sometimes due to various reasons like the social, political and economic implications of partition, social tension, continuing industrial unrest, communist insurgency, conflict, and competition in the trade union movement. In the process of consultation and confrontation, gradually the structure of the industrial relations system (IRS) evolved.

State intervention in the IRS was a part of the interventionist approach to the management of industrial economy. Several considerations like unequal distribution of power in the labour market, neutrality of the state, incompatibility of free collective bargaining institution with economic planning etc. provided moral justification for retaining state intervention in the IRS. State intervention in the IRS is logical also when the state holds large stakes in the industrial sector of the economy.

However state intervention does not mean suppression of trade unions and collective bargaining institution. In fact, state intervention and collective bargaining were considered as complementary to each other. Gradually, various tripartite and bipartite institutions were introduced to supplement the state intervention in the IRS.

The tripartite process was considered as an important instrument of involving participation of pressure groups in the state managed system. Non formal ways were evolved to do what the formal system did not legistate, for one reason or other.

The political and economic forces in the mid 1960s aggravated industrial conflict and rendered non-formal system ineffective. In the process of reviewing the system, National Commission on Labour (NCL) was appointed in 1966.

Now the focus of restructuring shifted from political to intellectual. However, yet another opportunity was lost when there was an impasse on the NCL recommendations in 1972. The Janta Government in 1978 made, of course, a half-hearted attempt to reform industrial relations. Unfortunately, the attempt met with strong opposition from all unions. The BMS, for example, termed it as “a piece of anti-labour, authoritarian and dangerous legislation””.

Several committees were appointed to suggest measures for reforming die IRS. In the process, tripartism was revived in 1980s. Government passed the Trade unions and the Industrial Disputes (Amendment) Bill, 1988. But, it also proved yet another legislative disaster. The bill was severely criticised by the left parties. It was even viewed by some as a deliberate attempt to destroy “autonomous; organised or militant trade union movement”.

Interactive and Consultative in Nature:

Industrial relations in­cludes individual relations and joint consultation between labour, management, unions, the state etc. It pinpoints the importance of compromise and accommodation in place of conflict and contro­versy in resolving disputes between labour and management.

Government’s Role:

The government influences and shapes indus­trial relations with the help of laws, rules, agreements, awards of courts and emphasis on usages, customs, traditions, as well as the implementation of its policies and interference through executive and judicial machinery.

Employer-Employee Interactions:

Industrial relations arise out of em­ployer-employee interactions. These relations cannot exist without the basic building blocks, i.e., the employer on one side and the employees on the other side.

Dynamic and Changing:

Industrial relations change with the times, generally keeping pace with the expectations of employees, trade unions, employers’ associations, and other economic and social institutions in a society. Apart from the legal framework, these societal forces generally influence the direction of industrial re­lations within a country.

Economic Factors:

These factors include economic organisations, like capitalist, communist, mixed, etc., the structure of labour force, demand for and supply of labour force, etc.

Institutional Factors:

These factors include government policy, la­bour legislation, voluntary courts, collective agreements, employee courts, employers’ federations, social institutions like community, caste, joint family, creed, system of beliefs, attitudes of workers, system of power, status, etc.

Web of Rules:

Industrial relations are a ‘web of rules’ formed by the interaction of the government, the industry and the labour. They include the relations between employer and employees and between employers’ associations, trade unions as well as the State.

Technological Factors:

These factors include mechanisation, automation, rationalisation, computerisation etc.

Spirit of Compromise and Accommodation:

The industrial relations system is characterized by forces of conflict and compromise on either side. In the larger interests of society, both the employer and the employees must put out fires amicably and get along with each other in a spirit of compromise and accommodation. The individual differences and disagreements must be dissolved through persuasion and even pressure. The factors responsible for conflictful situations need to be resolved through constructive mechanism.

Wide Coverage:

The scope of industrial relations is wide enough to cover a vast territory comprising of grievances, disciplinary measures, ethics, standing orders, collective bargaining, partici­patory schemes, dispute settlement mechanisms etc.

Industrial relations climate/situation is greatly influenced by the issues-economic, non-economic governed by service contract/terms and conditions of employment. Besides, the issues not covered under service rules viz., behavioural, and attitudinal issues influence IRs pattern.

They mobilize public opinion on vital labour issues and help the government in enacting progressive labour laws. They develop right kind of leadership, avoid multiplicity of unionism and union rivalry. Hence, a strong, responsible and enlightened trade union promote healthy industrial relations.

Maintaining Industrial Peace:

Industrial peace is essential to increase production and ensure healthy relations between the workers and employers.

The following measures help attain industrial peace:

1. Industrial disputes can be settled with the help of legislative enactment such as The Trade Unions Act, The Industrial Disputes Act and Work Committees and by Joint Management Councils.
2. The Government should be empowered to refer disputes to adjudication, specially when the situation gets out of hand. Government intervention is required during frequent stoppage of production due to long strikes or lockouts.
3. Forums based on the code of discipline in industry, the code of conduct, the code of efficiency, etc. can be set up to settle disputes.

Conflict Management:

Conflicts at the workplace affect the physical and mental health of the people. This has a bearing on organisational performance. Therefore, it is important to recognise, understand, and resolve conflicts in labour relations.

Trust and Co-Operation:

Trust and co-operation are essential in labour relations. They help build a partnership between workers and employers and both groups to work together. Lack of trust and co-operation between the two groups can result in conflicts, disputes and strikes. That slows down the productivity of the organisation.

Challenges

• International labour standards, their importance and implications.
• Globalisation has brought about internationalisation of employees; transnational, multi-location employees with cross cultural characteristics.
• WTO, IMF, WB and their influence
• Consumer forums, environment activists, citizens forum at time clash with TUs.
• Manpower diversities: Multi-racial, Multinational, multicultural, multi-lingual and multi-ethnic manpower requires different system/mind set to deal with.
• New management practices like Casualism, contracting, off-locating, out-sourcing part time/home based work/flextime, Team working/Quality Circles/Total Quality Management.
• Highly educated, careerist, ambitious manpower.
• IT revolution has changed the complexion of workplaces; Lesser manpower, Multi-skilled and Committed to profession.
• Individual/decentralised bargaining is replacing collective bargaining.
• Performance linked packages are the order of the day.

Government:

The role of the government has been changing from time to time in the matter of IR. Till 19th century, the governments throughout the world adopted a policy of laissez faire and left the IR matters to be settled by the employers and employees. However, with the increasing conflicts between them even on tiny matters, the governments’ attitudes changed to some kind of intervention in IR matters towards the end of 19th century.

In the present context, everywhere, governments intervene in the HR system in different ways. In India, government has prescribed various laws dealing with employer-employee relations and set machinery for resolving conflicts labour courts, tribunals at state and national levels.

These courts and tribunals intervene in the solution of industrial disputes referred to these. While developing IR system, an organization has to take into account the role played by the government in IR activities.

Employers’ Associations:

Like employees’ associations, employers may also join associations at the local or national level. The major associations of employers at all-India level are Federation of Indian Chambers of Commerce and Industry (FICCI), Confederation of Indian Industry (CII), Associated Chambers of Commerce and Industry (ASSOCHAM), Federation of Indian Export Organizations (FIEO), etc.

Besides, there are associations at national level representing each major industrial sector and state/regional level associations.

The major functions of the employers’ associations with regard to IR are:

• To represent employers in collective bargaining at the national or industry level.
• To develop machinery for the avoidance of disputes.
• To provide information on employee relations.
• To advise member organizations on the issues related to IR.

Employers:

The second party to IR is employers. Since in the corporate form of organization, management represents the owners/employers, it can be treated as the second party to IR. The management is an organization is responsible to various stakeholders including the employees. Therefore, employer-employee relationship is also termed as management-labour relations.

Management tends to see employee relations in terms of the following activities:

• Creating and maintaining employee motivation.
• Obtaining commitment from the workforce.
• Establishing mutually beneficial channels of communication throughout the organization.
• Achieving high level of efficiency.
• Negotiating terms and conditions of employment with employees’ representatives.
• Sharing decision making with employees.
• Engaging in a power structure with trade unions.
• Management’s role in determining the status of IR system is quite crucial.

The following factors related to the management are important for IR:

1. Attitudes of management towards the employees and their unions.
2. The extent to which the management wants to exercise absolute authority to enforce decisions affecting the interests of the employees.
3. The extent to which the management has designed the procedures for handling grievances, claims, and demands of the employees.
4. The extent of the effectiveness of management in dealing with the problems and disputes related to IR.
5. The organization’s business strategy; Stagnating, Growing, or Declining. In different situations, different IR strategy will be adopted.

Employees:

Employees are a party to IR as they are affected most by the IR outcomes. In an IR system, employees may be grouped into two categories- those who have been defined as workers/workmen under the Industrial Disputes Act, 1947 and those who are not covered by this Act.

Various characteristics of employees such as their commitment to the organization, their level of education and social background, their attitudes towards the management and the organization, and their commitment to the work determine the extent to which they will-

1. Improve their conditions of employment
2. Voice any grievances
3. Exchange views and ideas with management
4. Share in decision making.

Trade Unions:

Trade unions or other employees’ associations play crucial role in the effectiveness or otherwise of an IR system. The employees may have grievances, claims, and other demands on individual basis but they express these, often, on group basis. In order to strengthen their bargaining power, they form some kind of associations to voice their grievances.

According to Armstrong, trade unions/employees’ associations have the following broad objectives in relation to IR:

1. To secure improved terms and conditions of employment for their members, and the maximum degree of security to enjoy these terms and conditions.
2. To increase the bargaining advantage of the individual worker vis-a-vis the individual employer by joint or collective action for the individual action.
3. To obtain improved status for the worker in his work.
4. To increase the extent to which unions can exercise democratic control over decisions that affect their interests by power sharing at the national, corporate, and plant levels.

The role of unions in determining the status of IR in an organization depends on their membership, attitudes towards management, inter-union rivalry, and the strengths at the national or local level.

The term ‘Industrial Relations’ comprises “Industry” and “relations”. Industry means any productive activity in which an individual is engaged. It includes:

(a) Primary activities like agriculture, fisheries, plantation, forestry, horticulture, mining etc. etc.

(b) Secondary activities like manufacturing, construction, trade, transport, commerce, banking, communi­cation etc.

Industrial relation aims at building a strong relation between the employees and the employer as well as among the employees themselves. A strong industrial relation ensures protection of employee’s interest and successful attainment of organisational objectives in smooth and efficient manner.

Industrial relations are the relationships between employees and employers within the organizational settings. It looks at the relationship between management and workers, particularly groups of workers represented by a union. Industrial relations are basically the interactions between employers, employees and the government, and the institutions and associations through which such interactions are mediated.

Principles

• All employees be treated equally in the organisation. No discrimination should be practised in enforcing the policies and rules of the organisation.
• Workers should be given reasonable remuneration for their work. It will lead to contentment among them and contribute to industrial peace.
• Sense of belonging to organisation is created among workers when they get opportunity of participation in management. Their morale is boosted. It leads to good industrial relations.
• Industrial disputes should be a resolved by collective bargaining between trade unions and employers’ associations. Legal methods be used only if all other measures fail.
• Frank and free exchange of views between Trade Unions and Employers’ associations.
• In order to establish good industrial relations there should be desire for mutual co-operation between trade unions and management associations.
• There should be effective communication between workers and managements for good industrial relations. In this case, there will be minimum conflicts between them.
• Human treatment be meted out to the workers. Such a treatment will go a long way to make good industrial relations.