Industrial Relations

The term industrial relations includes the study of workers and their
trade unions, management, employers associations and the state
institutions concerned with the regulation of employment.
It can also be defined as the relations between employers and
employees in industry and also the relations between various
unions, between the state and unions as well as between various
unions, between the state and unions as well as between the
employers and the state.
Its scope includes:
Relations between managers and individual workers
The collective relations between employers and labour
The role of govt. in the regulation of these relationships

Objectives of Industrial Relations

1.

Good industrial relations should ensure that employees and unions

deal with their problems freely, independently and responsibly

2.

They should try to solve their problems through collective

bargaining. However, they can take the help of govt. m/c if desired.

3.

To check industrial conflicts and minimize the occurrence of

lockouts and gheraos.

4.

To minimize labour turnover and absenteeism by providing job

satisfaction to workers and increasing their morale

5.

To establish industrial democracy by ensuring workers participation

in management.

6.

to facilitate govt. control over industries in regulating production and

industrial relations.

Importance / Significance of Industrial

Relations
1.

Industrial Peace: Cordial industrial relations bring harmony and

remove causes of disputes. This leads to industrial peace which is
an ideal situation for industrial unit to concentrate on productivity
and growth

2.

Higher Productivity: due to cordial industrial relations, workers

take interest in their jobs and work efficiently. This leads to
higher productivity and production of the enterprise. Thus they
will contribute to the national growth of the nation

3.

Industrial democracy: Sound industrial relations are based on

consultation between workers and management. This assists in
the establishment of industrial democracy in organisation which
motivates employees to contribute their best to the success of
organisation.

Importance / Significance of Industrial

Relations
4.

5.

6.

Collective Bargaining; Cordial industrial relations are

extremely helpful for entering into long-term
agreements as regards various issues between
labour and management. Such collective bargaining
agreements and partcipation of students in decision
making process motivate the employees.
Fair Benefits to workers: the workers should get
sufficient economic and non-economic benefits to
lead a happy life. It is possible when the relations
between labour and management are cordial and the
productivity is high.
Higher morale: good industrial relations imply the
existence of an atmosphere of mutual cooperation,
confidence and respect within the enterprise. In
such an atmosphere there are common goals, which
motivates all members to contribute their best.

Importance / Significance of Industrial

Relations
7.

Facilitation of change: sound industrial relations by creating a

climate of cooperation and confidence, make the process of
change easy. Hence, full advantage of latest inventions,
innovations and other technological advancements can be
obtained. The workforce will easily adjusts itself to required
changes for betterment.

Parties to Industrial Relations

1.

2.

3.

Workers and Trade Unions: the personal characteristics of

workers, their culture, educational qualifications, skills and attitude
play an imp. role in industrial relations. Trade Unions are formed to
safeguard the economic and social interests of workers. They put
pressure on management through strikes, gheraos.
Employers and their organisation: Employers provide
employment and try to regulate the behaviour of employees.
Industrial disputes or unrest arise when their expectations are high
and they offer low economic and other benefits to employees.
Employers have their associations which put pressure on trade
unions and govt.
Government: - Govt. interferes in matters relating to rules regarding
employment, working conditions and regulates wages, bonus. It
keeps an eye on both Trade Unions and Employers organizations to
regulate their activities in the interest of nation .

Industrial Disputes
The term Industrial Dispute is defined by
Section 2(k) of the Industrial Disputes Act,
1947 as any disputes or differences
between employers and employers or
employers and workmen or between
workmen and workmen which is convicted
with the employment or non-employment
or the terms of employment or with the
conditions of labour of any person.

Causes of Industrial Disputes

1.
2.
3.
4.

5.
6.
7.

Economic Cause
Demand for increase in wages
Demand for increase in gratuity and other retirement
benefits
Demand for higher bonus
Demand for certain allowances such as HRA, Medical
Allowance, Night Shift Allowance, Conveyance
allowance
Demand for paid holidays
Reduction in working hours
Better working conditions

Causes of Industrial Disputes

2. Political Causes
Trade unions in India are controlled by various political parties. In
many cases, their leadership vests in the hands of persons who are
more interested in achieving their political interests rather than the
interests of labourers

3. Personnel Causes
Industrial Disputes sometimes are caused on account of personnel
problems like dismissal, retrenchment, layoff, transfer, promotion
etc.

4. Indiscipline
5. Industrial disputes also take place because of indiscipline
and violence on the part of workers.
Lockouts are
resorted to by the management to curb indiscipline and
violence.

Effects of Industrial Disputes

1. Effects on Employees
a) When the workers are on strike, the wages may not
be paid to workers for the strike period. Thus,
workers and their families have to face financial
difficulties due to such disputes.
b) The rate of bonus also comes down due to disputes as
it reduces the profitability
c) due to continuous disputes, the employer may
introduce lock out and the workers will have to suffer
d)
Some workers, particularly temporary workers, may
be dismissed during the period of disputes
e) Prolonged industrial disputes lead to industrial
sickness and even closure of the enterprise. As a
result, workers lose their job.

Effects of Industrial Disputes

1. Effects on Employees
f) Due to industrial disputes, the employers loss
sympathy for the workers. As a result, certain welfare
and other facilities may be denied to them.
1. Effects on Employer
a) The productivity and

profit ability of the

industrial unit go down due to industrial
disputes.
b) The quality of production and thereby the
market reputation is adversely affected due to
limited interest or non-cooperation from
workers during the period of dispute. I

Effects of Industrial Disputes

c) Industrial disputes bring higher labour

turnover.
Moreover, efficient and
sincere staff workers may not like to
continue with the firm where such
disputes are common.
d) Spoiled work increases due to indifferent
attitude of workers during the period of
dispute.
e) Industrial
disputes
affect
labour
management relations and this disturbs
the smooth working of the industrial unit

Effects of Industrial Disputes

Effects on Society
a) Industrial productivity goes down. In addition,
exports suffer and this affects the entire national
economy
b) Industrial disputes lead to shortages and artificial
price rise. This affects consumers and the
society at large.
c) Industrial growth of the country is jeopardized
due to large scale industrial disputes. The
expansion programmes are disturbed and the
rate of investment in the corporate sector goes
down.

Industrial Relations
Machinery
1. Preventive Machinery
a) Workers Participation in Management
b) Collective Bargaining
c) Grievance Procedure
d) Tripartite Bodies
e) Code of Discipline
f)

Standing Orders

Industrial Relations
Machinery
2. Curative Machinery
a) Conciliation
b) Court of Enquiry
c) Voluntary Arbitration
d) Adjudication

Labour Court
Industrial Tribunal
National Tribunal