Employer Associations
Employer Associations
Employers’ Organisations (EOs) are
“formal groups of employers set up to defend, represent or advise affiliated
employers and to strengthen their position in society at large with respect to labour
matters as distinct from economic matters. They may conclude collective agreements
but this is not a formal rule and cannot be an element of their definition. Unlike trade
unions, which are composed of individual persons, employers’ organisations are
composed of enterprises.
• Employers’ Organisations are mainly concerned with matters relating to
a wide range of employment issues including industrial relations.
• Chambers of Commerce are usually set up to defend the economic
interests of employers.
• In some countries such as the U.K., Norway and Jordan, for instance, the
same organisation deals with both.
• Primary Objectives
– Promote and protect the interest of employers engaged in
industry, trade and commerce in India.
– Study, analyse and disseminate information relating to labour
policy, labour management relations, collective bargaining, etc.
– Offer advice concerning various aspects of labour policy.
– Liaise with Union Government and initiate steps that are
representative and legislative in nature.
Employer Associations
• Secondary Objectives
– Train and develop staff and members.
– Obtain data on wages and conditions of work in industries attached to them. Come out with
surveys, research-based reports on issues of importance to both labour and management.
– Take up projects for social and family welfare.
– Deal with safety and health at work place and working environment.
– Initiate steps to improve public image and improve public relations.
– Educate the public regarding the character, scope, importance and needs of trade, industry and
commerce represented by members.
Structure of Employers’ Organisations
EOs are organised at three levels: a)
Local Organisations:
• They serve the interests of local businessmen. The Bombay Mill Owners Association, for example, has been
formed to protect the local interests of manufacturing units operating within the city. Such bodies operate
through the local chambers of commerce.
b) Regional Organisations:
• The regional outfits such as Employers’ Federation to South India, Employers’ Association, Calcutta are
affiliated to central employers organisation. They offer consultancy service; take care of training, safety
and welfare measures on behalf of their members. They even have special committees for specific region
or industry related problems.
c) Central Organisations:
• AIOE ( All India organization of Employers), EFI (Employer Fedration of India), AlMO ( All India Manufacture’s
Organization ) operated as apex bodies governing the affairs of several regional, local associations. To have better
coordination a super structure called the Council of Indian Employers was formed in 1956, bringing AIOE and EFI
under one umbrella.
Different Employers’ Organisations in India
• AIOE:
• The All India Organisation of Employers is a unitary type of organisation, setup in 1953; members hail from
manufacturing, banking, insurance, commercial establishments; and has no sub-organisation on an industrial or
geographical basis. The President is elected every year.
• EFI:
• The Employers’ Federation of India has a federal structure formed in 1933, it has governing body executive
committee and the secretariat. The governing body formulates policies, the executive committee implements
policies and the secretariat with its own permanent staff is responsible for carrying out the decisions of the
governing body. It had only four presidents in over 50 years. EFI was registered as a trade union in 1963 under the
Indian Trade Unions Act of 1926.
• IOE:
• International Organisation of Employers, represents the interests of employers in all social and labour matters at
the international level. Founded in 1920 with headquarters in Geneva, it has a membership of Employers’
Associations from over 100 countries. The Central Council of Indian Employers is a matter of IDE.
FUNCTIONS OF EMPLOYERS’ ORGANISATIONS
>The main role of an employers’ organization is to protect and promote the interests of its members.
➢ Its activities are designed and directed on a broader plan; labour problems are only a part of their overall
responsibilities.
➢ Economic, commercial and fiscal matters and policies are equally or even more important for them.
➢ Employers’ organizations find it necessary to have legislative support for the realization of their objectives.
FUNCTIONS OF EMPLOYERS’ ORGANISATIONS
a) Communication:
The employers’ associations keep their members informed of all new labour legislations (even at the formative
stage), regarding all changes in labour policy, important court decisions on labour matters, obligations accepted at
the national level, proceedings of important tripartite deliberations, etc.
b) Advisory Functions:
They advise their affiliates on complex legal provisions, procedures etc., when such advice is sought. Some of the
employers’ organizations have built up an expert advisory service on labour matters for their members
FUNCTIONS OF EMPLOYERS’ ORGANISATIONS
c) Educational Efforts:
They organize seminars, conferences and training programs at different levels to discuss important issues in the
labourmanagement relations. Important studies on collective agreements, role of the private sector in national
development, etc. have been carried out by the Employers’ Federation of India.
d) Representational Functions:
They are represented on various committees, wage boards, etc. set up by the government from time to time and
place before these bodies the point of view of employers. They have also set up special committees of their own to
study particular problems
FUNCTIONS OF EMPLOYERS’ ORGANISATIONS
e) Undertaking Social Responsibilities:
They also discharge certain social responsibilities towards the country and society by participating in
national plans for economic development, eliciting responsive cooperation from the unions in improving
levels of production and productivity, pursuing policies that are conducive to the development of
industry and the economy, adopting neighborhood, social development schemes, etc.
Membership of Employer Organization
➢ As in most countries in India too membership in EOs is voluntary.
➢ AIOE has two categories of members:
➢Individual (enterprise) and
➢Association (group of enterprises)
➢ EFI additionally has provision for honorary membership whereby individuals with special skills or
experience, such as legal luminaries or professionals are co-opted to serve on various committees of the
federation.
➢ The predominantly private sector EOs do not bar public sector enterprises becoming members and rather
welcome their entry and indeed have a few, the SCOPE remains an EO exclusively for the public sector that
too mainly the public sector enterprises in the central sphere
Organisation Structure of Employer Organization
➢ The federal type of organization structure with its activities distributed over a central body and the regional
committees.
➢ Both the AIOE and the EFI have a
Governing body - Supreme policy-making body
Executive committee - Responsible for implementing the policies and objectives
of the organization
Secretarial - A permanent staff, is responsible for carrying out the decisions of the governing body
Finance of Employer Organization
➢ Nearly half of the income of the EFI and one fourth of the income of the AIOE are from membership
subscriptions.
➢ Other incomes include interest on corpus/ deposits, conferences, publications, etc.
➢ Excessive dependence on income from subscription makes EOs financially vulnerable.
➢ The surest way for them to raise funds is to upgrade the quality, relevance and usefulness of
services to their members and other constituents, including the community.
Functioning of Employer Organization
(i) Study and analysis of problems and dissemination of information —
advice, advocacy and dispute settlement;
(ii) Guidance or conduct of collective bargaining. In India this role is voluntary and at the initiative and
request of the members;
(iii)Training and development of staff and members;
(iv) Safety and health at workplace and working environment; and
(v) Public image and public relations.
LEGAL STATUS OF EMPLOYERS’ ORGANISATIONS
➢ EOs could be registered in any of the following legal forms:
- The Trade Union Act, 1926
- Indian Companies Act, 1956 - The Societies Act, 1860.
