International Journal of Civil Engineering and Technology (IJCIET)

Volume 8, Issue 6, June 2017, pp. 67–74, Article ID: IJCIET_08_06_008

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ISSN Print: 0976-6308 and ISSN Online: 0976-6316

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A STUDY ON RECOGNITION OF TRADE

UNION AND ITS NECESSITY
G. Gopalakrishnan
Research Scholar in Management Studies, Bharath University, Chennai, India

Dr. G. Brindha
Research Supervisor, Professor & Head, Depart of Management Studies,
Dr. MGR University (Phase II). Adayalambattu. Chennai, India

ABSTRACT
Trade union plays significant role in shaping the worker’s life in India. But in
developed countries like India, unions are losing its membership in recent decades.
This downward trend is prevalent in certain group of workers like female workers,
young workers and those who are working in private sector particularly in a smaller
organisation. Worker being weaker segment they can get their rights only through
collective representation i.e. collective bargaining. Collective bargaining is the
backbone for harmonious industrial relations. Right to collective bargaining is
available only to recognized trade union. Recognition of trade union means accepting
or conferring right to negotiate on behalf of workers. In Bharat petroleum
corporation cases, the court of India held that there is no provision regarding
recognition, the right cannot be enforced by writ petition, to be conferred by the
management. In views of the above to bestow workers fundamental right and ensure
industrial peace, there should be a legislation of recognition of trade union.
Key words: Recognition, Union Recognition, Collective Bargaining, Settlements.
Cite this Article: G. Gopalakrishnan and Dr. G. Brindha. A Study on Recognition of
Trade Union and its Necessity. International Journal of Civil Engineering and
Technology, 8(6), 2017, pp. 67–74.
http://www.iaeme.com/IJCIET/issues.asp?JType=IJCIET&VType=8&IType=6

1. INTRODUCTION
Recognition of trade union and registration are not one and the same, they differ in nature.
Trade union registration is mandatory under “The Trade Union act, 1926”, but recognition of
trade union is not mandatory, it is process of conferring right to the trade union by the
management to represent the member employees as a sole bargaining agent during various
negotiations ether in to settlements on behalf of its members with the management and to
raise the members voice and opinion while formulating management policies and procedures
relating to their working conditions.

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 G. Gopalakrishnan and Dr. G. Brindha

Freedom of association / formation of trade union is a fundamental right conferred under

article 19 (1) (c) of Constitution of India, 1950 and it is statutory obligation on the part of
trade union to get it registered with registrar of trade unions. But, on the other hand, there is
no obligation on the part of management to recognize the trade union whether it is registered
or not. Though the trade union is in Union as well as Concurrent list, but there is no central
rule in India regarding recognition of trade union. However, states like Kerala, Andhra
Pradesh, Madhya Pradesh, Maharashtra, Odisha and Gujarat have made it statutory to
recognize the trade union, in Tamil Nadu the government is yet to think of making a law
towards recognition. ILO during its 32nd convention at Geneva, vide its Convention Number
98 made it mandatory for all its member countries to recognize the trade union but India is
yet to ratify.
The parliament had once made an amendment in “Trade Union (Amendment) Act, 1947
introducing recognition of trade union but it was neither notified nor brought in to force. At
present, the only provision for recognition is contained section 36 of Industrial Dispute Act,
1946, where under “in any proceeding under the act, a workman who is party to an industrial
dispute is entitled to be represented by (a) any member of the executive or other office bearer
of a registered trade union of which he is a member, or (b) any member of the executive or
other office bearer of a federation of trade unions to which the trade union referred to in
Clause (a) is affiliated; and (c) where the worker is not a member of any trade union, by any
member of the executive or other office bearer of any trade union connected with”. The said
provision concerns only with representation in industrial disputes and it does not as such
provide for recognition of any trade union.

2. REVIEW OF LITERATURE
Subramanian KN (1967) : The Royal Commission on Labour in India reported that that,
recognition of trade union should mean that the employer recognizes the right of the union to
negotiate with him in respect of matters affecting either the common or the individual interest
of the members.
Gupta (1973) : In an innovative study conducted at coal mines on union role of trade
union in wage regulation, it is found that only an organized labour movement can bring wage
parity among the workers in coal mines.
Devashis Rath and Snigdharani Misra (1996) : In an empirical study carried out by the
author on future of Industrial Relation, it is found that the IR in future will move towards
friendship between the management and trade union. The attitude of trade union shows a sign
of drastic change. The management and union have realized that without one’s support the
other cannot survive, both have surrendered their personal interest for the common
economical cause.
John Pencavel, (1996) : In a study probing how should the law treat labour unions and
collective bargaining?, what the unions do? In the study, various activities of the union were
analyzed. It was found that the standard of living of the workers can be improved only by
increasing the productivity. Because raising the worker’s salary through distributing income
from profit, dividend is persistent because ultimately the profit, divided all depends on
productivity. In the past 30 years it is evident from the countries like South Korea, Taiwan,
Hong Kong, Singapore that the standard of living of the workers can be raised only through
increasing productivity.
Verma (1998) : The study reveals that more than 40% of the workers are satisfied with the
working condition and the work load is adequate. Majority of the workers are satisfied with
the working of trade union and feel that their grievance could be effectively voiced through
the union and collective bargaining is possible only through recognized union.

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 A Study on Recognition of Trade Union and its Necessity

David Metcalf, (2002) : Study carried out on effect of Trade union and Productivity and
financial performance in 6 countries i.e. USA, Canada, UK, Germany, Japan and Australia. In
the study it was found that the union can both enhance or lower the productivity, in other
words the productivity depends on the level of industrial relation and work practices followed
by the union in the industry. In USA the evidence indicates that the performance was better
due to recognition of trade union and high performance work systems. In case of UK and
Australia, the productivity was low due to great competition and multi-unionism. In
Germany, the productivity was enhanced due to consultation with works councils, sharing of
information. In Japan, the unions tend to raise labour productivity by ensuring life time job /
job security.
Morris M. Kleiner & Hwikwon Ham (2002): A study was conducted in 20 OECD nations
and 50 states of United States for 10 years to examine the impact of unionization, strike
levels, labor policies, and collective bargaining within a nation on a country’s foreign direct
investment (FDI). Systematic approach was applied to examine the effect of Industrial
Relation on foreign Direct Investment. The study shows that the industrial relations system is
statistically significant and of moderate size in the arrangement of the systems variable. The
study also proves that Multinational companies in developed nations tend to be sensitive to
the industrial relations climate, preferring ones that provide management with a greater
amount of flexibility in allocating labor and setting standards at work. Giving workers an
atmosphere where they have a greater say at the workplace with higher wages and benefits
may be worth the reduction in foreign investment.
Anita Sarkar Biju Varkkey (2008) : There are two type of worker in the industry, the first
one is blue collar worker who do manual work and other being white collar work who are in
clerical category. In a study carried out on unionized employees of Tata plant, it is found that
dual loyalty exists among the workers. Conflict between the management and union is lesser
as compared to blue collar workers union. As compared to union, the management plays
bigger role on recruitment, job allocation, skill enhancement decision and monetary benefits.
Job security is the most important factor and white collar employees join the union mainly for
the security of their job.
Cristina Bălăneasa, Aurel Manolescu (2009) : A study carried out in Romania to find the
role to trade unions in regulating labour relations, it was found that good industrial relation
improves productivity and economy. Making policy on working conditions, labour market
and training is no longer the responsibility of state but the union and employers. Good
industrial relation between employees and employers will improve the situations help to
overcome the hardship.
Piyali Ghosh, Shefali Nandanand Ashish Gupta (2009) : In an exploratory study carried
out on NTPC, Unchahar on changing role of union at plant level, in addition to their regular
role of maintaining good industrial relation, along with employer union is actively involved in
improving the employee’s quality of work life. Worker participation in decision making
regarding their welfare activities are encouraged. Union also actively participating in
organizing training and development programs for their workers to improve their skill.
Unions are involving themselves in welfare measures to retain and attract more members
towards their union. Growth of small unions are avoided by union involving in welfare
activities, thereby workers are motivated to remain within the union rather than joining other
unions. Welfare of the workers proved to be an unavoidable component of the functions of
trade union.
Ratna Sen (2009) : Recognition of trade union is the process through which managements
acknowledges and accept the trade union as representative of workers in an organisation and

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 G. Gopalakrishnan and Dr. G. Brindha

with the union, the management is willing to have discussion of all issues concerning to
workers.
Anthea Hollist, (2012): CFA Business skills at work was commissioned by the UK
Commission for Employment and Skills to investigate Labour Market and report on the
Industrial Relations in UK. The report focused on, profile of trade union membership in UK,
membership, characteristics, qualification levels of union, skills challenges, skills related,
skill gap faced by employers in UK, and learning provisions available. From the commission
it is found that, the union representatives provide service for the benefit of employee and
employer by improving the skill level of employees thereby improve the productivity;
negotiate with the employee and employer to avoid labour turn over by way of unfair
dismissals. Create awareness among employees on health and safety. Reduce absenteeism
and improve labour retention thereby improving productivity.

3. DATA COLLECTION AND ANALYSIS

In Tamil Nadu, Chennai sub-urban area there are around 6 industrial parks, namely
Oragadam, Sriperumbudur, Irungattukottai, Sriperumbudur, Pillaipakkam and Maraimalai
Nagar where major Automobile industries like Ford, Renault Nissan, Daimler (Bharat Benz),
Hyundai, Komatsu, Apollo tyres, Allison Transmission and their ancillaries are located, all
together more than 500 industries of tier-I, II and III are located to cater for the above said
Original Equipment Manufacturers. Data was collected by simple questionnaire in local
language (Tamil) from 500 employees working in the industries. The data was collected from
male, female employees, age ranging from 21 to 50 years and unionized and non-union
industries to ensure homogeneity of data.

Table 1 Sample distribution based on age

Age group Frequency Percent Valid percent Cumulative percent
Less than 30 202 40.4 40.4 40.4
30 ~ 40 225 45.0 45.0 85.4
40 ~ 50 50 10.0 10.0 95.4
More than 50 23 4.6 4.6 100.0
Total 500 100.0 100.0
According to the employee’s age, the employees are divided in to 4 groups. From the
above table it is found that the sample unit consists of maximum of 202 employees, which
amounts to 40.4 % in the age group less than 30. Maximum of 225 employees, which
amounts to 45 % in the age group between 30 to 40. Maximum of 50 employees, which
amounts to 10 % in the age group between 40 to 50, and Maximum of 23 employees, which
amounts to 4.6 % in the age group above 50.
Gender plays main role in any social science or study, present business environment men
and women equally opt for professional carrier. In industry too, there is need to hire and
retain large number of skilled employees. Most of the industries where assembly work is
involved, the management prefers women employees, but women employees are less likely to
join any trade union and fight for their rights as compared to men. In industries where women
are employed, we can say there is no union. the following table shows men and women
participant in the survey :

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 A Study on Recognition of Trade Union and its Necessity

Table 2 Sample distribution based on gender

Gender Frequency Percent Valid percent Cumulative percent
Male 433 86.6 86.6 86.6
Female 67 13.4 13.4 100
Total 500 100 100
From the above table it is found that out of 500 samples collected, 433 were male, which
is equivalent to 86.6 % and 67 employees i.e. 13.4 % were female.

Table 3 Sample distribution based on qualification

Qualification Frequency Percent Valid percent Cumulative Percent
ITI 209 41.8 41.8 41.8
Diploma 245 49.0 49.0 90.8
Graduate 46 9.2 9.2 100.0
Total 500 100.0 100.0
Qualification plays an important role in the industry. Employees are employed according
to their qualification. Based on the qualification the employees are grouped in to three
categories i.e. ITI, Diploma and Graduate. From the above table, out of 500 samples, 41.8 %
of the employee’s possess ITI, 49 % of the employee’s possess Diploma and 9.2 % of the
employee’s belonging to Graduate.

Table 4 Sample distribution based on marital status

Marital status Frequency Percent Valid Percent Cumulative Percent
Married 340 68.0 68.0 68.0
Unmarried 160 32.0 32.0 100.0
Total 500 100.0 100.0
Marital status plays important role in Industrial Relations. Married employees are less
likely to join trade union because of their responsibility towards the family. From the above
table it is evident that 340 are male, which is 68 % and 160 are female which is 32%

Table 5 Sample distribution based on position they hold

Position Frequency Percent Valid Percent Cumulative Percent
Lower level 419 83.8 83.8 83.8
Middle level 75 15.0 15.0 98.8
Senior level 6 1.2 1.2 100.0
Total 500 100.0 100.0
Position plays important position in Industrial Relation. Employees in middle and higher
level are considered as staff and not covered under the category of worker under the “The
industrial Dispute Act, 1947”. Employees in lower lever are considered as Worker under
section 2(s) of Industrial Dispute Act. From the above mentioned table it is clear that out of
500 samples, 419 are from lower category, which is 83.8 %, 75 are from middle category,
which is 15%, 6 are from higher category, which is 1.2%

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 G. Gopalakrishnan and Dr. G. Brindha

Table 6 Sample distribution based on present company they work

Department Frequency Percent Valid Percent Cumulative Percent
Production 438 87.6 87.6 87.6
Admin 62 12.4 12.4 100.0
Total 500 100.0 100.0
Department plays key role in determining industrial relations. Employees employed in
production are more related to industrial relation and employees working in administration
department are generally not concerned about Industrial Relation. From the table it is evident
that from the sample of 500, 438 employees i.e. 87.6% are from production department and
62 employees i.e. 12.4 % from administrative department
The Recognition of Trade Union consists of 10 variables. In Likert’s 5 point scale, this
ranges from Strongly Agree to Strongly Disagree. The parametric “t-test” is applied and the
following results are obtained:

Table 7 t-tests (5 Likert’s points scale)

Vari N Mean Std. Deviation Std. Error t Sig. Rank
Mean (2-tailed) (mean)
1 500 3.4180 .66042 .02953 14.153 .000 5
2 500 3.3580 .68027 .03042 11.768 .000 7
3 500 3.4460 .64180 .02870 15.539 .000 4
4 500 3.4140 .66595 .02978 13.901 .000 6
5 500 3.9760 .76459 .03419 28.544 .000 1
6 500 2.1960 .83124 .03717 -21.628 .000 10
7 500 2.9600 .88088 .03939 -1.015 .310 9
8 500 3.2120 .99046 .04429 4.786 .000 8
9 500 3.7000 .69207 .03095 22.617 .000 3
10 500 3.7460 .74201 .03318 22.481 .000 2
From the above table it is found that the employees in the manufacturing companies have
strongly agreed for the necessity of making rule for recognition of trade union, training for
the office bearers of trade union and bargaining councils can perform better. Neutral opinion
about qualification for the officer bearers, awareness about freedom of association,
acceptance by the management on freedom of association, and workers participation
management. But, strongly disagree for acceptance of external union by the management and
union performance.

4. FINDINGS
It is found that employees in the age group of less than 30, married employees, employees in
lower rank and ITI/Diploma qualified employees mainly working in production department
have strongly agree, while female employees have expressed neutral opinion for making rule
towards recognition of trade union.
It is also found that recognition of trade union influences collective bargaining, wage
settlement, dispute resolution, interpersonal relation and work environment. Unless there is
statutory obligation on the part of management to recognize the registered trade union,
collective bargaining is a mirage.

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 A Study on Recognition of Trade Union and its Necessity

Unless the recognition of trade union is made mandatory, freedom of association has no
meaning. Only by association or forming the trade union, fundamental right cannot be
guaranteed.

5. SUGGESTION
Only the recognized trade union has the right to do collective bargaining to negotiate wage
and working condition on behalf of employees. There is no central government law on
recognition of trade union in India. Few states have made recognition as statutory, but in
Tamil Nadu it is not so. Therefore, the government should come forward to enact law for the
recognition of trade union to ensure constitutional guarantee.
In India, most of the trade unions are affiliated to political parties. Other than top leaders,
other officer bearers are mostly active erstwhile union members who had been associated
with establishments for sometimes. In other words, the office bearers are neither qualified nor
trained adequately in labour laws and negotiation procedures. Therefore, training should be
given to trade union officer bearers on labour related laws, negotiation procedures for
effective performance.
Industrial Relations involve continuous and sustained relationship between union and
management. The tendency to view trade union as a rival must be avoided. Management
should come forward to accept the union and have meaningful exchange of views on matters
affecting the long term interests of the company and the employees. The fact that employees
are also stake holders should not be forgotten.

6. CONCLUSIONS
Recognition of trade union is the backbone of collective bargaining. Collective bargaining
plays an important role in maintaining employer employee relationship and harmonious
industrial relations at workplace. It is well settled legal position that constitution of India,
1950 Article 19 (1) (c) does not confer any right on the part of trade union to claim for
recognition from the management. Although the Industrial Dispute Act, 1947, has made
refusal to bargain collectively by the employer with the union as an unfair labour practice, the
provision does not have much significance without statutory obligation to recognize the trade
union. The National Commission on Labour recommended compulsory recognition of
representative union, and worked out a comprehensive legislation draft covering all aspects of
industrial relation, but it remained in papers. Considering the advantages of recognition of
trade union, being the founder member of International Labour Organisation (ILO), the
government of India should change its mind set and ratify ILO convention No. 98 for
recognition of trade union.

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