Industrial relations has become one of the most delicate and complex problems of modern

industrial society. Industrial progress is impossible without cooperation of labors and

harmonious relationships. Therefore, it is in the interest of all to create and maintain good
relations between employees (labor) and employers (management).

Concept of Industrial Relations:

The term ‘Industrial Relations’ comprises of two terms: ‘Industry’ and ‘Relations’. “Industry”
refers to “any productive activity in which an individual (or a group of individuals) is (are)
engaged”. By “relations” we mean “the relationships that exist within the industry between the
employer and his workmen.”.

The term industrial relations explains the relationship between employees and management
which stem directly or indirectly from union-employer relationship.

Definitions:
The term ‘industrial relations’ has been variously defined. J.T. Dunlop defines industrial
relations as “the complex interrelations among managers, workers and agencies of the
governments”.
According to 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”.
The HR Employee Relations Manager directs the organization's employee relations function.
They develop employee relations policies and ensure consistent application of company policies
and procedures. In addition, they are responsible for employee dispute resolution procedures,
performing internal audits, and taking appropriate action to correct any employee relations
issues.

The School of Industrial and Labor Relations at Cornell University was the world's first
school for college-level study in HR located in Ithaca, New York, USA. ILR (Industrial
and Labor Relations) specializes in the fields of human resource management, labor
relations, and dispute resolution.
The Center for Human Resources at the University of Pennsylvania was founded in 1921.
The Center's mission is to foster research on the strategic role of HR management in
such areas as employment, labor relations, public policy, diversity, and training and
education. The Center supports its mission through research, regular meetings,
information bulletins, and conferences and public forums.

Importance of Industrial Relations:

The healthy industrial relations are key to the progress and success. Their significance may be
discussed as under –
  Uninterrupted production – The most important benefit of industrial relations is that
this ensures continuity of production. This means, continuous employment for all from
manager to workers. The resources are fully utilized, resulting in the maximum possible
production. There is uninterrupted flow of income for all. Smooth running of an industry
is of vital importance for several other industries; to other industries if the products are
intermediaries or inputs; to exporters if these are export goods; to consumers and
workers, if these are goods of mass consumption.

 Reduction in Industrial Disputes – Good industrial relations reduce the industrial

disputes. Disputes are reflections of the failure of basic human urges or motivations to
secure adequate satisfaction or expression which are fully cured by good industrial
relations. Strikes, lockouts, go-slow tactics, gherao and grievances are some of the
reflections of industrial unrest which do not spring up in an atmosphere of industrial
peace. It helps promoting co-operation and increasing production.

 High morale – Good industrial relations improve the morale of the employees.
Employees work with great zeal with the feeling in mind that the interest of employer and
employees is one and the same, i.e. to increase production. Every worker feels that he is a
co-owner of the gains of industry. The employer in his turn must realize that the gains of
industry are not for him along but they should be shared equally and generously with his
workers. In other words, complete unity of thought and action is the main achievement of
industrial peace. It increases the place of workers in the society and their ego is satisfied.
It naturally affects production because mighty co-operative efforts alone can produce
great results.

 Mental Revolution – The main object of industrial relation is a complete mental

revolution of workers and employees. The industrial peace lies ultimately in a
transformed outlook on the part of both. It is the business of leadership in the ranks of
workers, employees and Government to work out a new relationship in consonance with
a spirit of true democracy. Both should think themselves as partners of the industry and
the role of workers in such a partnership should be recognized. On the other hand,
workers must recognize employer’s authority. It will naturally have impact on production
because they recognize the interest of each other.

 Reduced Wastage – Good industrial relations are maintained on the basis of cooperation
and recognition of each other. It will help increase production. Wastage of man, material
and machines are reduced to the minimum and thus national interest is protected.

Thus, it is evident that good industrial relations is the basis of higher production with minimum
cost and higher profits. It also results in increased efficiency of workers. New and new projects
may be introduced for the welfare of the workers and to promote the morale of the people at
work. An economy organized for planned production and distribution, aiming at the realization
of social justice and welfare of the massage can function effectively only in an atmosphere of
industrial peace. If the twin objectives of rapid national development and increased social justice
are to be achieved, there must be harmonious relationship between management and labor.
Objectives of Industrial Relations:
The main objectives of industrial relations system are:-

1. 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.
2. 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.
3. To raise productivity to a higher level in an era of full employment by lessening the
tendency to high turnover and frequency absenteeism.
4. 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.
5. To eliminate or minimize the number of strikes, lockouts and gheraos by providing
reasonable wages, improved living and working conditions, said fringe benefits.
6. To improve the economic conditions of workers in the existing state of industrial
managements and political government.
7. Socialization of industries by making the state itself a major employer
8. Vesting of a proprietary interest of the workers in the industries in which they are
employed.

Causes & Effects of Poor Industrial Relations

Industrial Relations

 Industrial Relations
o Causes & Effects of Poor Industrial Relations
o Approaches to Industrial Relations
 Collective bargaining
o Principles of Collective Bargaining
 Workers participation in Management
(The Constitution of India, Art 43A)
o Levels and Forms of Workers Participation In Management
 Employee welfare
 Occupational health and safety
o Occupational healthy and safety (Indian context)
 Industrial Disputes
 Strikes
  Lockouts
 Layoff / Laid off and Retrenchment
 Labour Courts for disputes in India
 Grievance procedure
o Methods of Identifying Grievances
 Alternative Dispute Resolution
o Arbitration & conciliation

USA

 Grievance Management

Perhaps the main cause or source of poor industrial relations resulting in inefficiency and labour
unrest is mental laziness on the part of both management and labour. Management is not
sufficiently concerned to ascertain the causes of inefficiency and unrest following the laissez-
faire policy, until it is faced with strikes and more serious unrest. Even with regard to methods of
work, management does not bother to devise the best method but leaves it mainly to the
subordinates to work it out for themselves. Contempt on the part of the employers towards the
workers is another major cause. However, the following are briefly the causes of poor industrial
relations:

 Mental inertia on the part of management and labour;

 An intolerant attitude of contempt of contempt towards the workers on the part of

management.

 Inadequate fixation of wage or wage structure;

 Unhealthy working conditions;

 Indiscipline;

 Lack of human relations skill on the part of supervisors and other managers;

 Desire on the part of the workers for higher bonus or DA and the corresponding desire of
the employers to give as little as possible;

 Inappropriate introduction of automation without providing the right climate;

 Unduly heavy workloads;

 Inadequate welfare facilities;

 Dispute on sharing the gains of productivity;

 Unfair labour practices, like victimization and undue dismissal;

  Retrenchment, dismissals and lock-outs on the part of management and strikes on the part
of the workers;

 Inter-union rivalries; and

 General economic and political environment, such as rising prices, strikes by others, and
general indiscipline having their effect on the employees’ attitudes.

Facts [+]

In USA there is no federal law or mandate that requires an employer to give workers lunch
breaks or rest periods, although most companies allow and encourage them. Studies have found
up to 58% of American workers skip their lunch break. Health and workplace experts suggest
that this practice ultimately leads to worker burnout and diminished productivity.

Effects of Bad Industrial Relations

Industrial relations are of great importance in industrial life. These relations have great bearing
on the economic, social and political spheres of our society. If in an organisation, relations
between labour and management are cordial, there will be industrial peace and interests of both
the parties will be automatically safeguarded. However, organisations where industrial relations
are strained, the organisations have to face lot of problems. The atmosphere of such
organisations is always surcharged with industrial unrest leading either to strikes or lockouts.
Organisations which ignore the importance of industrial relations face high cost of production.
Adverse effect on efficiency, low-grade production, negligence in the execution of work,
absenteeism among the workers, high rate of labour turn-over etc. are the evils that result from
poor industrial relations.

Lack of cordiality in industrial relations not only adversely affects the interests of the labourers
and employers but also cause harm to different sections of society. They are faced with lot of
difficulties and problems.

Demerits of bad industrial relations can be expressed as under:

 Effect on Workers: (i) Loss of wages, (ii) Physical injury or death on account of
violence during labour unrest, (iii) Excesses by employers, (iv) Economic losses, (v)
Bitterness in relations, (vi) Adverse affect on career.

 Effect on Employers / Industrialists: (i) Less production, (ii) Less Profit, (iii) Bad
affect on organisation, (iv) Bad effect on human relations, (v) Damage to machines and
equipments, (vi) Adverse effect on development of companies, (vii) Burden of fixed
expenses.

 Effect on Government: (i) Loss of revenue (less recovery of income tax. sales tax, etc.)
(ii) Lack of order in society, (iii) Blame by different parties.
  Effect on Consumers: (i) Rise in prices, (ii) Scarcity of goods, (iii) Bad affect on quality
of goods.

 Other Effects: (i) Adverse affect on International Trade (Fall in exports and rise in
imports), (ii) Hindrance in Economic Development of the country, (iii) Uncertainty in
economy.

To conclude, it can be said that almost all sections of the society suffer loss in one way or the
other due to bad industrial relations. In order to maintain peace in industrial units it is of utmost
importance that employers and workers should make constant endeavour to establish cordial
human relations.

Approaches to Industrial Relations

Industrial conflicts are the results of several socio-economic, psychological and political
factors. Various lines of thoughts have been expressed and approaches used to explain
his complex phenomenon. One observer has stated, “An economist tries to interpret
industrial conflict in terms of impersonal markets forces and laws of supply demand. To
a politician, industrial conflict is a war of different ideologies – perhaps a class-war. To a
psychologist, industrial conflict means the conflicting interests, aspirations, goals,
motives and perceptions of different groups of individuals, operating within and reacting
to a given socio-economic and political environment”.

Psychological approach
The problems of IR have their origin in the perceptions of the management, unions and
the workers. The conflicts between labour and management occur because every group
negatively perceives the behaviour of the other i.e. even the honest intention of the
other party so looked at with suspicion. The problem is further aggravated by various
factors like the income, level of education, communication, values, beliefs, customs,
goals of persons and groups, prestige, power, status, recognition, security etc are host
factors both economic and non-economic which influence perceptions unions and
management towards each other. Industrial peace is a result mainly of proper attitudes
and perception of the two parties.

Sociological approach
Industry is a social world in miniature. The management goals, workers’ attitudes,
perception of change in industry, are all, in turn, decided by broad social factors like the
culture of the institutions, customs, structural changes, status-symbols, rationality,
acceptance or resistance to change, tolerance etc. Industry is, thus inseparable from
the society in which it functions. Through the main function of an industry is economic,
its social consequences are also important such as urbanization, social mobility,
housing and transport problem in industrial areas, disintegration of family structure,
stress and strain, etc. As industries develop, a new industrial-cum-social pattern
emerges, which provides general new relationships, institutions and behavioural pattern
and new techniques of handling human resources. These do influence the development
of industrial relations.

Human relations approach

Human resources are made up of living human beings. They want freedom of speech,
of thought of expression, of movement, etc. When employers treat them as inanimate
objects, encroach on their expectations, throat-cuts, conflicts and tensions arise. In fact
major problems in industrial relations arise out of a tension which is created because of
the employer’s pressures and workers’ reactions, protests and resistance to these
pressures through protective mechanisms in the form of workers’ organization,
associations and trade unions.

Through tension is more direct in work place; gradually it extends to the whole industry
and sometimes affects the entire economy of the country. Therefore, the management
must realize that efforts are made to set right the situation. Services of specialists in
Behavioural Sciences (namely, psychologists, industrial engineers, human relations
expert and personnel managers) are used to deal with such related problems.
Assistance is also taken from economists, anthropologists, psychiatrists, pedagogists,
tec. In resolving conflicts, understanding of human behavior – both individual and
groups – is a pre-requisite for the employers, the union leaders and the government –
more so for the management. Conflicts cannot be resolved unless the management
must learn and know what the basic what the basic needs of men are and how they can
be motivated to work effectively.

It has now been increasingly recognized that much can be gained by the managers and
the worker, if they understand and apply the techniques of human relations approaches
to industrial relations. The workers are likely to attain greater job satisfaction, develop
greater involvement in their work and achieve a measure of identification of their
objectives with the objectives of the organization; the manager, on their part, would
develop greater insight and effectiveness in their work.

Theoretical perspectives
Industrial relations scholars have described three major theoretical perspectives or
frameworks, that contrast in their understanding and analysis of workplace relations.
The three views are generally known as unitarism, pluralist and radical. Each offers a
particular perception of workplace relations and will therefore interpret such events as
workplace conflict, the role of unions and job regulation differently. The radical
perspective is sometimes referred to as the "conflict model", although this is somewhat
ambiguous, as pluralism also tends to see conflict as inherent in workplaces. Radical
theories are strongly identified with Marxist theories, although they are not limited to
kosala.
Unitary Perspective
In unitarism, the organization is perceived as an integrated and harmonious system,
viewed as one happy family. A core assumption of unitary approach is that
management and staff, and all members of the organization share the same objectives,
interests and purposes; thus working together, hand-in-hand, towards the shared
mutual goals. Furthermore, unitarism has a paternalistic approach where it demands
loyalty of all employees. Trade unions are deemed as unnecessary and conflict is
perceived as disruptive.

From employee point of view, unitary approach means that:

 Working practices should be flexible. Individuals should be business process

improvement oriented, multi-skilled and ready to tackle with efficiency whatever
tasks are required.
 If a union is recognized, its role is that of a further means of communication
between groups of staff and the company.
 The emphasis is on good relationships and sound terms and conditions of
employment.
 Employee participation in workplace decisions is enabled. This helps in
empowering individuals in their roles and emphasizes team work, innovation,
creativity, discretion in problem-solving, quality and improvement groups etc.
 Employees should feel that the skills and expertise of managers supports their
endeavors.

From employer point of view, unitary approach means that:

 Staffing policies should try to unify effort, inspire and motivate employees.
 The organization's wider objectives should be properly communicated and
discussed with staff.
 Reward systems should be so designed as to foster to secure loyalty and
commitment.
 Line managers should take ownership of their team/staffing responsibilities.
 Staff-management conflicts - from the perspective of the unitary framework - are
seen as arising from lack of information, inadequate presentation of
management's policies.
 The personal objectives of every individual employed in the business should be
discussed with them and integrated with the organization’s needs.

Pluralistic-Perspective

In pluralism the organization is perceived as being made up of powerful and divergent

sub-groups - management and trade unions. This approach sees conflicts of interest
and disagreements between managers and workers over the distribution of profits as
normal and inescapable. Consequently, the role of management would lean less
towards enforcing and controlling and more toward persuasion and co-ordination. Trade
unions are deemed as legitimate representatives of employees. Conflict is dealt by
collective bargaining and is viewed not necessarily as a bad thing and if managed could
in fact be channeled towards evolution and positive change.Realistic managers should
accept conflict to occur. There is a greater propensity for conflict rather than harmony.

They should anticipate and resolve this by securing agreed procedures for settling
disputes.

The implications of this approach include:

 The firm should have industrial relations and personnel specialists who advise
managers and provide specialist services in respect of staffing and matters
relating to union consultation and negotiation.
 Independent external arbitrators should be used to assist in the resolution of
disputes.
 Union recognition should be encouraged and union representatives given scope
to carry out their representative duties
 Comprehensive collective agreements should be negotiated with unions

Marxist Perspective

The Marxist approach looks at industrial relations from a societal perspective. It views
industrial relations as a microcosm of the wider capitalist society. The basic assumption
of this approach is that industrial relations under capitalism are an everlasting and
unavoidable source of conflict According to this approach, industrial conflicts are the
central reality of industrial relations, but open conflicts are uncommon.15 The Marxist
approach views industrial disputes as a class struggle and industrial relations as a
politicized concept and an element of the class struggle. As per the Marxist approach,
the understanding of industrial relations requires an understanding of the capitalized
society, the social relations of production and the mechanism of capital accumulation.

The Marxist approach views the power relationship between the two classes, namely,
the employer (capital) and the employee (labour), as the crux of the industrial relations.
Both classes struggle hard to consolidate their respective positions so that they can
have a greater leverage over the other in the process of bargaining. The proponents of
this approach perceive that the employers can survive longer without labour than the
employees can without work. As far as theory is concerned, the compensation payable
to the employees is an outcome of the power struggle. For instance, the employers
seek to maximize their profits by paying less compensation to the employees, while the
latter resist such attempts, and this resistance results in industrial conflicts. However,
the weakness of this theory is that it is narrow in approach as it views industrial relations
as a product or outcome of the industrial conflict.

The System Approach

The system approach was developed by J. P. Dunlop of Harvard University in 1958.
According to this approach, individuals are part of an ongoing but independent social
system. The behaviour, actions and role of the individuals are shaped by the cultures of
the society. The three elements of the system approach are input, process and output.
Society provides the cue (signal) to the individuals about how one should act in a
situation. The institutions, the value system and other characteristics of the society
influence the process and determine the outcome or response of the individuals. The
basis of this theory is that group cohesiveness is provided by the common ideology
shaped by the societal factors.

According to Dunlop, the industrial relations system comprises certain actors, certain
contexts, and an ideology, which binds them together and a body of rules created to
govern the actors at the workplace and work community. The actors in the system are
the managers, the workers and their representatives, and the government agencies.
The rules in the system are classified into two categories:

Substantive rules and Procedural rules.

The substantive rules determine the conditions under which people are employed. Such
rules are normally derived from the implied terms and conditions of employment,
legislations, agreements, practices and managerial policies and directives.

The procedural rules govern how substantive rules are to be made and understood.
Ultimately, the introduction of new rules and regulations and revisions of the existing
rules for improving the industrial relations are the major outputs of the industrial
relations system. These may be substantive rules as well as procedural rules." The
context in the system approach refers to the environment of the system which is
normally determined by the technological nature of the organization, the financial and
other constraints that restrict the actors of industrial relations, and the nature of power
sharing in the macro environment, namely, the society.

Collective bargaining

In the work situation, an individual worker has to face many problems such as, low wages, long
hours of work, loss incentive etc. These problems of an individual or few individuals cannot
attract the attention of the employer because of their less bargaining power. The growth of trade
union increased the bargaining strength of workers and enables them to bargain for their better
conditions collectively.

Collective bargaining is a source of solving the problems of employees in the work situation
collectively. It provides a good climate for discussing the problems of workers with their
employers. The employees put their demands before the employers and the employers also give
certain concession to them. Thus it ensures that the management cannot take unilateral decision
concerning the work ignoring the workers. It also helps the workers to achieve responsible
wages, working conditions, working hours, fringe benefits etc. It provides them a collective
strength to bargain with employer. It also provides the employers some control over the
employees.

The process of collective bargaining is bipartite in nature, i.e. the negotiations are between the
employers and employees without a third party’s intervention. Thus collective bargaining serves
to bridge the emotional and physiological gulf between the workers and employers though direct
discussions.

The HR Labor Relations Manager directs the organization's labor relations agreement in
accordance with executive level instruction and endorsement. They supervise labor relations
support staff and serve as the management representative in labor negotiation, bargaining, or
interpretive meetings

Meaning
The term collective bargaining is made up of two words, ‘collective’ – which means a ‘group
action’ through representation and ‘bargaining’, means ‘negotiating’, which involves proposals
and counter-proposals, offers and counter-offers. Thus it means collective negotiations between
the employer and the employee, relating to their work situations. The success of these
negotiations depends upon mutual understanding and give and take principles between the
employers and employees.

Definitions
The phrase collective bargaining is made up of two words collective which implies group action
through its representatives; and bargaining which suggests haggling and / or negotiating. The
phrase, therefore, implies collective negotiation of a contract between the management’s
representatives on one side and those of the workers on the other. Thus collective bargaining is
defined as a process of negotiation between the employer and the organized workers represented
by their union in order to determine the terms and conditions of employment.

Stevens: Collective Bargaining as a ‘social control technique for reflecting and transmitting the
basic power relationships which underlie the conflict of interest in an industrial relations system.’

Prof. Allan Flanders: Collective Bargaining is primarily a political rather than an economic
process. He describes collective bargaining as a power relationship between a trade union
organization and the management organization. The agreement arrived at is a compromise
settlement of power conflicts. Collective Bargaining has also been described as “the great social
invention that has institutionalized industrial conflict” Dubin

Richardson says, “Collective bargaining takes place when a number of work people enter into
negotiation as a bargaining unit with an employer or a group of employers with the object of
reaching agreement on conditions of the employment of the work people”.

The ILO has defined collective bargaining as "negotiations about working conditions and terms
of employment between an employer and a group of employees or one or more employees'
organizations with a view to reaching an agreement wherein the terms serve as a code of defining
the rights and obligations of each party in their employment relations with one another; fix a
large number of detailed conditions of employment, and derivatives validity, none of the matters
it deals which can in normal circumstances be given as a ground for a dispute concerning an
industrial worker".

A collective bargaining process generally consists of four types of activities- distributive

bargaining, integrative bargaining, attitudinal restructuring and intra-organizational bargaining.

Distributive bargaining:
It involves haggling over the distribution of surplus. Under it, the economic issues like wages,
salaries and bonus are discussed. In distributive bargaining, one party’s gain is another party’s
loss. This is most commonly explained in terms of a pie. Disputants can work together to make
the pie bigger, so there is enough for both of them to have as much as they want, or they can
focus on cutting the pie up, trying to get as much as they can for themselves. In general,
distributive bargaining tends to be more competitive. This type of bargaining is also known as
conjunctive bargaining.

Integrative bargaining:
This involves negotiation of an issue on which both the parties may gain, or at least neither party
loses. For example, representatives of employer and employee sides may bargain over the better
training programme or a better job evaluation method. Here, both the parties are trying to make
more of something. In general, it tends to be more cooperative than distributive bargaining. This
type of bargaining is also known as cooperative bargaining.

Attitudinal restructuring:
This involves shaping and reshaping some attitudes like trust or distrust, friendliness or hostility
between labor and management. When there is a backlog of bitterness between both the parties,
attitudinal restructuring is required to maintain smooth and harmonious industrial relations. It
develops a bargaining environment and creates trust and cooperation among the parties.

Intra-organizational bargaining:
It generally aims at resolving internal conflicts. This is a type of maneuvering to achieve
consensus with the workers and management. Even within the union, there may be differences
between groups. For example, skilled workers may feel that they are neglected or women
workers may feel that their interests are not looked after properly. Within the management also,
there may be differences. Trade unions maneuver to achieve consensus among the conflicting
groups.

Characteristics Of Collective Bargaining

  It is a group process, wherein one group, representing the employers, and the other,
representing the employees, sit together to negotiate terms of employment.
 Negotiations form an important aspect of the process of collective bargaining i.e., there is
considerable scope for discussion, compromise or mutual give and take in collective
bargaining.
 Collective bargaining is a formalized process by which employers and independent trade
unions negotiate terms and conditions of employment and the ways in which certain
employment-related issues are to be regulated at national, organizational and workplace
levels.
 Collective bargaining is a process in the sense that it consists of a number of steps. It
begins with the presentation of the charter of demands and ends with reaching an
agreement, which would serve as the basic law governing labor management relations
over a period of time in an enterprise. Moreover, it is flexible process and not fixed or
static. Mutual trust and understanding serve as the by products of harmonious relations
between the two parties.
 It a bipartite process. This means there are always two parties involved in the process of
collective bargaining. The negotiations generally take place between the employees and
the management. It is a form of participation.
 Collective bargaining is a complementary process i.e. each party needs something that the
other party has; labor can increase productivity and management can pay better for their
efforts.
 Collective bargaining tends to improve the relations between workers and the union on
the one hand and the employer on the other.
 Collective Bargaining is continuous process. It enables industrial democracy to be
effective. It uses cooperation and consensus for settling disputes rather than conflict and
confrontation.
 Collective bargaining takes into account day to day changes, policies, potentialities,
capacities and interests.
 It is a political activity frequently undertaken by professional negotiators.

The collective bargaining process comprises of five core steps:

1. Prepare: This phase involves composition of a negotiation team. The negotiation team should
consist of representatives of both the parties with adequate knowledge and skills for negotiation.
In this phase both the employer’s representatives and the union examine their own situation in
order to develop the issues that they believe will be most important. The first thing to be done is
to determine whether there is actually any reason to negotiate at all. A correct understanding of
the main issues to be covered and intimate knowledge of operations, working conditions,
production norms and other relevant conditions is required.

2. Discuss: Here, the parties decide the ground rules that will guide the negotiations. A process
well begun is half done and this is no less true in case of collective bargaining. An environment
of mutual trust and understanding is also created so that the collective bargaining agreement
would be reached.
3. Propose: This phase involves the initial opening statements and the possible options that exist
to resolve them. In a word, this phase could be described as ‘brainstorming’. The exchange of
messages takes place and opinion of both the parties is sought.

4. Bargain: negotiations are easy if a problem solving attitude is adopted. This stage comprises
the time when ‘what ifs’ and ‘supposals’ are set forth and the drafting of agreements take place.

5.Settlement: Once the parties are through with the bargaining process, a consensual agreement
is reached upon wherein both the parties agree to a common decision regarding the problem or
the issue. This stage is described as consisting of effective joint implementation of the agreement
through shared visions, strategic planning and negotiated change.

Functions

Prof. Butler has viewed the functions as:

1. a process of social change

2. a peace treaty between two parties
3. a system of industrial jurisprudence

1. Collective bargaining as a process of social change

 Collective bargaining enhances the status of the working class in the society. Wage
earners have enhanced their social and economic position in relation to other groups.

 Employers have also retained high power and dignity through collective bargaining.

2. Collective bargaining as a peace treaty

 Collective bargaining serves as a peace treat between the employers and employees.
However the settlement between the two parties is a compromise.

3 Collective bargaining as an industrial jurisprudence

Collective bargaining creates a system of “Industrial Jurisprudence”. It is a method of

introducing civil rights into industry. It establishes rules which define and restrict the traditional
authority exercised by employers over their employees placing part of the authority under joint
control of union and management.

In addition to the above, its functions include:

 Increasing the economic strength to employers and employers.

 Improving working conditions and fair wages.
  Maintaining peace in industry
 Prompt and fair redressel of grievances.
 Promoting stability and prosperity of the industry.

Principles of Collective Bargaining

Industrial Relations

 Industrial Relations
o Causes & Effects of Poor Industrial Relations
o Approaches to Industrial Relations
 Collective bargaining
o Principles of Collective Bargaining
 Workers participation in Management
(The Constitution of India, Art 43A)
o Levels and Forms of Workers Participation In Management
 Employee welfare
 Occupational health and safety
o Occupational healthy and safety (Indian context)
 Industrial Disputes
 Strikes
 Lockouts
 Layoff / Laid off and Retrenchment
 Labour Courts for disputes in India
 Grievance procedure
o Methods of Identifying Grievances
 Alternative Dispute Resolution
o Arbitration & conciliation

USA

 Grievance Management

The success of collective bargaining is based on certain principles. These principles are to be
followed by the employers and unions. Prof. Arnold. F. Campo has laid down certain principles
for union and management, for management and for union.

For both union and management

1. Collective bargaining process should give due consideration to hear the problems on both
sides. This will develop mutual understanding of a problem which is more important for
arriving at the solutions.
 2. Both the management and union should analyze the alternatives to arrive at the best
solution.
3. There must be mutual respect on both the parties. The management should respect the
unions and the unions should recognize the importance of management.
4. Both the union and management must have good faith and confidence in discussion and
arriving at a solution.
5. Collective bargaining required effective leadership on both sides, on the union side and
management side to moderate discussions and create confidence.
6. In collective bargaining both the union and management should observe the laws and
regulations in practice in arriving at a solution.
7. In all negotiations, the labour should be given due consideration – in wage fixation, in
working conditions, bonus etc.

For management

1. Management should think of realistic principles and policies for labour regulations.
2. The recognitions of a trade union to represent the problems is more essential. If there are
more than one union, the management can recognize on which is having the support of
majority of workers.
3. Management should follow a policy of goodwill, and cooperation in collective bargaining
rather than an indifferent attitude towards the union.
4. Managements need not wait for trade union to represent their grievances for settlement.
Management can voluntarily take m

easures to settle the grievances.

5. Managements should give due consideration to social and economic conditions of

workers in collective bargaining.

For unions

1. Unions should avoid undemocratic practices.

2. Unions have to recognize their duties to the management also before emphasizing their
demands.
3. Unions have to consider the benefits to all workers rather than a section of workers.
4. Strike lock-outs should be resorted to, only as a last measure. As far as possi

Employee welfare -Activities - Statuary welfare benefits - APPROACHES TO

LABOUR WELFARE

Industrial Relations
 

However, the [International Labour Organization] ILO at its Asian Regional Conference, defined
labour welfare as a term which is understood to include such services, facilities and amenities as
may be established in or in the vicinity of undertakings to enable the persons employed in them
to perform their work in healthy, congenial surroundings and to provide them with amenities
conducive to good health and high morale.

Welfare includes anything that is done for the comfort and improvement of employees and is
provided over and above the wages. Welfare helps in keeping the morale and motivation of the
employees high so as to retain the employees for longer duration. The welfare measures need not
be in monetary terms only but in any kind/forms. Employee welfare includes monitoring of
working conditions, creation of industrial harmony through infrastructure for health, industrial
relations and insurance against disease, accident and unemployment for the workers and their
families.

Labor welfare entails all those activities of employer which are directed towards providing the
employees with certain facilities and services in addition to wages or salaries.

Labor welfare has the following objectives:

 To provide better life and health to the workers

 To make the workers happy and satisfied
 To relieve workers from industrial fatigue and to improve intellectual, cultural and
material conditions of living of the workers.

The basic features of labor welfare measures are as follows:

 Labor welfare includes various facilities, services and amenities provided to workers for
improving their health, efficiency, economic betterment and social status.
 Welfare measures are in addition to regular wages and other economic benefits available
to workers due to legal provisions and collective bargainin.
 Labor welfare schemes are flexible and ever-changing. New welfare measures are added
to the existing ones from time to time.
 Welfare measures may be introduced by the employers, government, employees or by
any social or charitable agency.
 The purpose of labor welfare is to bring about the development of the whole personality
of the workers to make a better workforce.

The very logic behind providing welfare schemes is to create efficient, healthy, loyal and
satisfied labor force for the organization. The purpose of providing such facilities is to make their
work life better and also to raise their standard of living. The important benefits of welfare
measures can be summarized as follows:
  They provide better physical and mental health to workers and thus promote a healthy
work environment
 Facilities like housing schemes, medical benefits, and education and recreation facilities
for workers’ families help in raising their standards of living. This makes workers to pay
more attention towards work and thus increases their productivity.
 Employers get stable labor force by providing welfare facilities. Workers take active
interest in their jobs and work with a feeling of involvement and participation.
 Employee welfare measures increase the productivity of organization and promote
healthy industrial relations thereby maintaining industrial peace.
 The social evils prevalent among the labors such as substance abuse, etc are reduced to a
greater extent by the welfare policies.

Facts [+]

India. The Factories act >> was enacted in the year 1948. The main objective of this law
is to maintain healthy, safety and welfare of every employee at workplace in factory .
According to this law any factory with above 500 workers should have separate welfare
officer, factory with 1000 above workers should have separate safety officer, for 500
workers should have ambulance facility and for above 250 workers canteen facility with
concession should be provided.

Employee Welfare Benefits Schemes

Organizations provide welfare facilities to their employees to keep their motivation levels high.
The employee welfare schemes can be classified into two categories viz. statutory and non-
statutory welfare schemes. The statutory schemes are those schemes that are compulsory to
provide by an organization as compliance to the laws governing employee health and safety.
These include provisions provided in industrial acts like Factories Act 1948, Dock Workers Act
(safety, health and welfare) 1986, Mines Act 1962. The non-statutory schemes differ from
organization to organization and from industry to industry.

Some of employee welfare Laws in India

 Factories Act, 1948
 Maternity Benefit Act,1961 (with latest amendments)
 Employee State Insurance Act, [ESI] 1948
 Employees' Provident Fund Scheme, 1952.
 Payment of Bonus Act, 1965

Statuary welfare benefits

The statutory welfare benefits schemes include the following provisions:

1. Drinking Water: At all the working places safe hygienic drinking water should be
provided.
2. Facilities for sitting: In every organization, especially factories, suitable seating
arrangements are to be provided.
3. First aid appliances: First aid appliances are to be provided and should be
readily assessable so that in case of any minor accident initial medication can be
provided to the needed employee.
4. Latrines and Urinals: A sufficient number of latrines and urinals are to be
provided in the office and factory premises and are also to be maintained in a
neat and clean condition.
5. Canteen facilities: Cafeteria or canteens are to be provided by the employer so
as to provide hygienic and nutritious food to the employees.
6. Spittoons: In every work place, such as ware houses, store places, in the dock
area and office premises spittoons are to be provided in convenient places and
same are to be maintained in a hygienic condition.
7. Lighting: Proper and sufficient lights are to be provided for employees so that
they can work safely during the night shifts.
8. Washing places: Adequate washing places such as bathrooms, wash basins
with tap and tap on the stand pipe are provided in the port area in the vicinity of
the work places.
9. Changing rooms: Adequate changing rooms are to be provided for workers to
change their cloth in the factory area and office premises. Adequate lockers are
also provided to the workers to keep their clothes and belongings.
10. Rest rooms: Adequate numbers of restrooms are provided to the workers
with provisions of water supply, wash ba
sins, toilets, bathrooms, etc.
11. Maternity & Adoption Leave – Employees can avail maternity or
adoption leaves. Paternity leave policies have also been introduced by various
companies.
12. Medi-claim Insurance Scheme: This insurance scheme provides
adequate insurance coverage of employees for expenses related to
hospitalization due to illness, disease or injury or pregnancy.
13. Sexual Harassment Policy: To protect an employee from
harassments of any kind, guidelines are provided for proper action
and also for protecting the aggrieved employee. For more information
go through - Sexual Harassment of Women at Workplace (Prevention,
Prohibition and Redressal) Act, 2013

NON STATUTORY BENEFITS

Many non-statutory welfare benefits may include the following schemes:
Big Business, Bad Suppliers
Walmart

Walmart workers in some supplier companies in Bangladesh, China, Indonesia, Nicaragua and
Swaziland were denied minimum wages and mandated health care and they were forced to work
overtime without compensation.

Apple Inc.

March, 2002: and Apple Company commissioned audit at Foxconn Electronics, with a big
presence in China, had documented violations like unpaid wages, excessive over time and low
salaries.

Sports goods major

the report said Adidas, Reebok, Nike and Puma were sourcing from companies whose workers
suffered seven working days a week, 16 to 18 working hours a day, sexual harassment of
women, and forced to do overtime without payment for over time.

Nestlé USA

Its suppliers have been accused of child labour, repression of workers rights, and violation of
National health and in government the laws. In 2006, the International labour rights fund and
Birmingham-based law firm filed a class action suit against Nestlé and some of its suppliers on
behalf of former child slaves.

source: the economic times

1. Personal Health Care (Regular medical check-ups): Some of the companies provide
the facility for ext
2. ensiv
e health check-up
3. Flexi-time: The main objective of the flextime policy is to provide opportunity to
employees to work with flexible working schedules. Flexible work schedules are initiated
by employees and approved by management to meet business commitments while
supporting employee personal life needs
4. Employee Assistance Programs: Various assistant programs are arranged like external
counseling service so that employees or members of their immediate family can get
counseling on various matters.
5. Employee Referral Scheme: In several companies employee referral scheme is
implemented to encourage employees to refer friends and relatives for employment in the
organization.