Industrial Relations

Industrial Relations
the regulation of relationship between employers and employees Industrial relations encompasses a set of phenomena, both inside and outside the workplace, concerned with determining and regulating employment relationship

 J.T. Dunlop defines

the complex interrelations among managers, workers and agencies of the governments.

Dale Yoder
industrial relations is the process of management dealing with one or more unions with a view to negotiate and subsequently administer collective bargaining agreement or labour contract.

 In the words of Richard Lester, "Industrial relations involve attempts at arriving at solutions between the
conflicting objectives and values; profit motive and social gain; discipline and freedom, authority and industrial democracy; bargaining and co-operation; and conflicting interests of the individual, the group and the community.

OBJECTIVES OF IR
To safeguard the interest of labor and management by securing the highest level of mutual understanding and good-will among all those sections in the industry which participate in the process of production. To avoid industrial conflict or strife and develop harmonious relations, which are an essential factor in the productivity of workers and the industrial progress of a country. To raise productivity to a higher level in an era of full employment by lessening the tendency to high turnover and frequency absenteeism. To provide an opportunity for WPM decision making. To establish and promote the growth of an industrial democracy based on labor partnership in the sharing of profits and of managerial decisions, so that ban individuals personality may grow its full stature for the benefit of the industry and of the country as well.

OBJECTIVES OF IR
To eliminate or minimize the number of strikes, lockouts and gheraos by providing reasonable wages, improved living and working conditions, said fringe benefits. To improve the economic conditions of workers in the existing state of industrial managements and political government. Socialization of industries by making the state itself a major employer Vesting of a proprietary interest of the workers in the industries in which they are employed.

NATURE OF IR
Shaped by the interaction of Govt, industry & labor IR is multi dimensional: influenced by complex set of institutional. economic & technological factors IR is dynamic and changing: owing to PESTER IR is characterized by forces of conflict and compromise. Individual differences and disagreements resolved through constructive means. Scope of IR is very wide see next slide Interactive and consultative in nature: in resolving conflict, controversies and disputes between labor and management.

SCOPE OF IR
Management Union relationship Employer Employee relationship Relationship amongst various groups of employees Effect of PESTER on workplace relationships Also covers such aspects of industrial life as
trade unionism, collective bargaining, workers participation in management, discipline , grievance handling, industrial disputes and interpretation of labor laws , rules and code of conduct.

 Does HRM pose a challenge to IR? How can conflicts between the two, if any, be reconciled so that they can complement each other?

 IR theory, practice and institutions traditionally focus more on the collective aspect of relations.
IR occupies a central place in labour law, Through
freedom of association, collective bargaining, the right to strike, employee involvement practices which involve unions, trade unionism and so on.

HRM deals
with the management of human resources,
rather than with the management of collective relations.

There is of course a certain measure of overlap.

 Individual grievance handling falls within the ambit of both disciplines, Dispute settlement of collective issues more properly falls within the scope of IR. Four processes central to a HRM system
selection, appraisal, rewards and Development

Team-building, communication and cooperation, though primarily HRM initiatives, have a collectivist aspect.

 Thus "at its most basic HRM represents a set of managerial initiatives." "Based on theoretical work in the field of organizational behaviour it is proposed that HRM comprises a set of policies designed to maximise
organizational integration, employee commitment, flexibility and quality of work.

Within this model, collective industrial relations have, at best, only a minor role."

 In IR the central monetary reward is wages and salaries, given effect to by collective bargaining, internal equity and distributive justice and standardisation across industry. HRM increasingly places emphasis on monetary rewards linked to performance and skills through the development of performance which seeks to individualise monetary rewards

The Industrial Revolution

From the 1790s to 1860s Major changes in agriculture, manufacturing, mining, transportation, and technology Had a profound effect on the social, economic and cultural conditions of the times. It began in the UK, subsequently spread throughout Western Europe, North America, Japan, and eventually the rest of the world. Almost every aspect of life was influenced in some way.

The Industrial Revolution

In the two centuries following 1800, the world's average per capita income increased over tenfold, while the world's population increased over sixfold. The First Industrial Revolution, which began in the 18th century, merged into the Second Industrial Revolution around 1850, when technological and economic progress gained momentum with the development of steam-powered ships, railways, and later in the 19th century with the internal combustion engine and electrical power generation.

Impact of Industrial reveloution

Fundamental Shifts in Social Structure During the Industrial Revolution, the social structure of society changed dramatically. The new enclosure lawswhich required that all grazing grounds be fenced in at the owner's expensehad left many poor farmers bankrupt and unemployed, machines capable of huge outputs made small hand weavers redundant. As a result, many people were forced to work at the new factories.

Impact of Industrial revolution Social Structure

It led to migration to towns and cities Workers made less money for longer hours. higher living expenses due to urbanization, women and children were sent out to work, making up 75% of early workers
they could be paid little, and children could be controlled more easily than adults, Children also had smaller hands, which were often needed to reach in among the parts of a machine. Furthermore, children were more malleable, and adapted to the new methods Children were also sent to work in mines, being small enough to get more coal and ore They could also be forced to work as long as eighteen hours each day.

Impact of Industrial revolution Social Structure

The laissez-faire approach taken by the governmentand advocated by philosopher-economist Adam Smith allowed capitalism to flourish. Little or no government regulations allowed the wealthy owners to pursue whichever path was most profitable, regardless of safety and well being of workers. As women and children, were labouring up to 18 hours/day, there was very little family contact, contributed to the breakdown of the family unit.
Children received little education, had stunted growth, and were sickly. They also grew up quite maladjusted, having never been taught how to behave properly

Impact of Industrial revolution Social Structure

However, the social changes were not all negative.
Most classes eventually benefited from the huge profits By 1820 most workers were making somewhat better wages. The "widespread poverty and constant threat of mass starvationlessened, Overall health and material conditions of the populace clearly improved

Impact of Industrial revolution Political and economic conditions

Politically, the electoral reforms were introduced to include more people in the right to vote. During the 1800s, worker disenchantment grew as living conditions deteriorated. As the Industrial Revolution progressed, the factory owners accumulated great wealth while the working classes retained none. Socialism grew during the 1800s as a reaction to the Industrial Revolution. Its egalitarian nature, preaching more state influence, equal rights, and an end to inhumanity, stood strongly opposite individualism and laissez-faire politics

Evolution of Industrial relation

Industrial relations has its roots in the industrial revolution which created the modern employment relationship . Labor problems arose, low wages, long working hours, monotonous and dangerous work, and abusive supervisory practices led to high employee turnover, violent strikes, and the threat of social instability. Intellectually, industrial relations was formed at the end of the 19th century as a middle ground between classical economics and Marxism, with Sidney Webb and Beatrice Webbs Industrial Democracy (1897) being the key intellectual work. Institutionally, it was founded by John R. Commons with his first academic industrial relations program at the University of Wisconsin in 1920.
Early financial support for the field came from John D. Rockefeller, Jr. Montague Burton, endowed chairs in industrial relations at Leeds, Cardiff and Cambridge in 1930, and the discipline was formalized in the 1950s with the formation of the Oxford School by Allan Flanders and Hugh Clegg.

Industrial relations was formed with a strong problem-solving orientation that rejected both the classical economists laissez faire solutions to labor problems and the Marxist solution of class revolution.

Factors affecting employee relations

INTERNAL FACTORS:
Attitudes of management towards employees and unions Attitudes of employees towards management and unions Attitudes of unions towards unions towards management and employees Present and likely future strength of unions Effective and agreed procedures for discussing and resolving grievances or handling disputes within the company

Factors affecting employee relations

Inter union rivalries in case of more than one union Effectiveness and capability of managers and supervisors in resolving grievances and handling disputes. Company's strategy like expansion, diversification, contraction , stabilization, turnaround and stagnation etc Quality of work life ( QWL), growth and developmental opportunities Degree of Autonomy and Empowerment given to employees

FACTORS AFFECTING EMPLOYEE RELATIONS EXTERNAL FACTORS:

Militancy of unions- nationally or locally Authority and effectiveness of the employers family The extend to which bargaining is carried out at national, local or plant level The effectiveness of any national or local procedure agreements that may exist Employment situation nationally or locally Legal framework within which IR exists

Effects of poor Industrial Relations

1. Multiplier effects: Modern industry and for that matter modern economy are interdependent. The total loss caused due to its multipliers effect on the total economy is always very great. 2. Fall in normal tempo : The work falls below the optimum level. Costs build up. Absenteeism and labor turnover increase. Plants discipline breaks down and both the quality and quality of production suffer. 3. Resistance of change : Dynamic industrial situation calls for change more or less continuously involves a whole chain of changes and this is resisted bitterly if these are industrial conflict. 4. frustration and social cost : When employees find difficulty in satisfying their social and psychological needs they feel frustrated. They reduce cordiality and aggravate social tension.

UNITARY APPROACH
IR is grounded in mutual cooperation, team work and shared goals. Work place conflict is temporary aberration,
resulting from poor management

Employees mix easily with organization culture Unions cooperate with the management
everyone benefits when the focus is on common interest and promotion of harmony

Managements right to manage is accepted

there is no we/they feeling

Participation of Govt, tribunals and unions are not sought or seen as being necessary

PLURALISM
(CONFLICT APPROACH )

The assumption of existence of more than one ruling principle It perceives organizations as coalitions of competing interests
managements role is to mediate among different interest groups.

It perceives trade unions as legitimate representative of employee interests It also perceives stability in IR as the product of concessions and compromises between management and unions. Conflict between management and workers is inevitable, essential for innovation and growth
It is containable through various institutional arrangements ( like collective bargaining, conciliation and arbitration etc).

Employees join unions to protect their interests and influence decision making by the management. Unions balance the power between management and employees. In pluralistic approach a strong unions is not only desirable but necessary

MARXIST APPROACH
Marxists regard conflict as inevitable but see it as a product of capitalistic society For them conflict arises because of the division in the society between capitalists and labour class. Industrial conflict is thus equated with political and social unrest Trade Unions are seen as
labor reaction to exploitation by capitalists, a weapon to bring about a revolutionary social change.

For them all strikes are political and state intervention ( via legislations and creation of Industrial Tribunals ) is for supporting managements interests.

Systems approach
IR - a social sub-system within the economic & political systems Components
Actors employer, employee and govt. contexts - PESTER, Demographics etc rules - regulatory elements - developed by IR processes

OTHER APPROACHES OF INDUSTRIAL RELATIONS

( DIFFERENT SCHOOLS OF THOUGHT )

PSYCHOLOGICAL APPROACH
Differences in the perceptions factors influencing their relations i.e. wages. Benefits, services and working conditions etc Dissatisfaction compels workers to turn aggressive and resort to strike, lockouts and gherao etc.

SOCIOLOGICAL APPROACH
Sociological factors such as
value system, customs and traditions etc

affect the relations between labor and management

OTHER APPROACHES OF INDUSTRIAL RELATIONS

( DIFFERENT SCHOOLS OF THOUGHT )

HUMAN RELATIONS APPROACH

Human behavior is influenced by
feelings, sentiments and attitudes.

As per this approach humans are motivated by variety of social and psychological factors
like economic and non-economic awards to be used.

 V V GIRI APPROACH
Collective bargaining and joint negotiations be used to settle disputes between labor and management. Outside interference to be avoided.

GANDHIAN APPROACH
worker's right to strike but cautioned that this right be exercised in just cause and in a peaceful and non-violent manner for minimum wages etc like satyagrah- Non violent non- cooperation

Pre-requisite/Functional Requirements of A Successful Industrial Relations Programme

Top Management Support Sound Personnel Policies Adequate Practices should be developed by professionals Detailed Supervisory Training Follow-up of Results

Role of government and Management in Industrial Relations

Governments
Legislation Administrative action, and The system of courts

Management
Implementing the mechanism of industrial relations Facilitating trade unions Encouraging collective bargaining Adhering to industrial laws

Occupations in Ancient India

Agriculture Trading Manual working Largely influenced by caste system
Brhamana priest class Shaytriya warriors Vyasya money lending, and merchants Shudra manual scavengingz, cobblers, etc.

Professions passed through heredity

Goldsmiths, blacksmiths, potter, carpenter, charioteers, architests, sculptors, artisans, weavers, armours etc

Occupations in Medieval India

Largely same as in the ancient India with a few developments like:
Foreign invasions change the occupation patterns Changes during Moghul rule Formation of guilds and unions Exploitation of land lords started

Early British rule impact on industry

Entry of East India company Infrastructure development Exploitation of locals Interference in local affairs Mining industry started Railways laid High demand of products from Europe

First World War to PreIndependence Period

Taking over of rule Infrastructure development Exploitation of locals High demand of products from Europe Local rich enters competition Enactment of laws under influence of ILO
Workmen Compensation Act 1923, Trade Union Act, 1926, Industrial Dispute Act, 1917