Name of Teacher: Dr Suman Solanki
Course name: HRM
Semester: vi
Section: A &B
Subject : Industrial relations
Unit : 1
Evolution of industrial Relations in INDIA
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.
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 sum 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 Defence 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 legislate, 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”.
APPROACHES TO INDUSTRIAL RELATIONS
The terms "industrial relations" is used to denote a specialist area of organizational
management and study which is concerned with a particular set of phenomena associated
with regulating the human activity of employment. It is, however, difficult to define the
boundaries of this set of phenomena-and, therefore, the term itself-in a precise and
universally accepted way. Any more specific definition must, of necessity, assume and
emphasise a particular view of the nature and purpose of industrial relations.
Consequently, there are as many definitions as there are writers on industrial relations.
For example, the two most frequently used terms of industrial Climate for Industrial
Relations, and 'employee relations' are, in most practical senses, interchangeable; yet they
have very different connotations. The former, more traditional, term reflects the original
historical base of unionized manual workers within the manufacturing sector of the
economy whilst the latter has come into greater use with the development of less
unionised white collar employment and the service and commercial sectors of the
economy. (The term 'industrial relations' is used because it is the more commonly known
and used term'). The terms may be used in a very restrictive sense to include only the
formal collective relationship between management and employees (through the medium
of trade unions) or in an all-inclusive sense to encompass all relationships associated with
employment (those between individuals at the informal level as well as those of a formal
collective or organisational nature).
However, it is doubtful whether the two approaches can, or should, be separated so
easily-informal, interpersonal or group relationships are influenced by the formal
collective relationships which exist within the industrial relations system, and it may be
argued that the formal collective relationships are themselves, in part, determined by the
nature of individual relationship. Clearly, the borderline between formal and informal or
individual and collective relationships within organisations cannot provide a natural
boundary for the subject matter of industrial relations.
In short, the various approaches are highlighted below:-
(A) Unitary Perspective: The unitary perspective is based on the assumptions that the
organisation is-or if it is not, then it should be an integrated group of people with a single
authority/loyalty structure and a set of common values, interests and objectives shared by
all members of the organisation. Management's prerogative (i.e., its right to manage,
make decisions) is regarded as legitimate, rational and accepted and any opposition to it
(whether formal or informal, internal or external) is seen as irrational. The organisation is
not, therefore, regarded as a 'them and us' situation- as Farnham and Pimlott put it. There
is "no conflict between the interests of those supplying capital to the enterprise and their
managerial representatives, and those contributing their labour....the owners of capital and
labour are but complementary partners to the common aims of production, profit and pay
in which everyone in the organisation has a stake" The underlying assumption of this
view, therefore, is that organisational system is in basic harmony, and conflict is
unnecessary and exceptional.
This has two important implications:
Conflict (i.e., the expression of employee dissatisfaction and differences with
management) is perceived as an irrational activity.
Trade Unions are regarded as intrusions into the organisation from outside which
compete with management for the loyalty of employees. The unitary perspective is found
predominantly amongst managers particularly line-management-and, therefore, is often
regarded as a management ideology.
Fox has argued that management clings to this view because:
It legitimises its authority-role by projecting the interests of management and
employees as being the same and by emphasising management's role of
'government in the best interests of the organisations, as a whole;
It reassures managers by confirming that conflict (dissatisfaction), where it
exists, is largely the fault of the government rather than management;
It may be projected to the outside world as a means of persuading them that
managements decisions and actions are right and the bets in the circumstances
and that any challenge to them is, at best, misguided or, at worst, subversive.
(B) Pluralistic Perspective: Fox believes that this view of the organisation
"probably represents the received orthodoxy in many Western societies" and is
often associated with a view of society as being 'post-capitalist,' i.e., that there is a
relatively widespread distribution of authority and power within the society, a
separation of ownership from management, a separation of political and industrial
conflict, and an acceptance and institutionalisation of conflict in both spheres.
This perspective is based on the assumption that the organisation is composed of
individuals who coalesce into a variety of distinct sectional groups, each with its
own interest, objectives and leadership (either formal or informal). The
organisation is perceived as being multi-structured and leadership (either formal
or informal). The organisation is perceived as being multi-structured and
competitive in terms of groupings, leadership, authority and loyalty and this, fox
argues, gives rise to complex of tensions and competing claims which have to be
'managed' in the interests of maintaining a viable collaborative structure' the
underlying assumption of this approach, therefore, is that the organisation is in a
permanent state of dynamic tension resulting from the inherent conflict of interest
between the various sectional groups and requires to be managed through a
variety of roles, institutions and processes. The implications of this view for the
nature of conflict and the role of the trade unions are very different to those of the
unitary approach.
(C) Radical Marxist Perspective: The radical perspective, which is also often
referred to as the Marxist perspective, concentrates, on the nature of the society
surrounding the organisation. It assumes and emphasises that the organisation
exists within a capitalist society where, Hyman argues, "the assumes and
production system is privately owned.......; profit.....is the key influence on
company policy.........; and control over production is enforced downwards by the
owners' managerial agents."
The Marxist general theory of society argues that:
I. Class (group) conflict is the source of societal change-without such
conflict, society would stagnate;
II. Class conflict arises primarily from the disparity in the distribution of, and
access to, economic power within the society-the principal disparity being
between those who own capital and those who supply their labour;
III. The nature of the society's social and political institutions is derived from
this economic disparity and reinforces the position of the dominant
establishment group, for example, through differential access to education,
the media, employment in government and other establishment bodies,
etc.;
IV. Social and political conflict in whatever from is merely an expression of
the underlying economic conflict within the society.
