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 explain the relationship between employees and management which stem directly or indirectly from union-employer relationship.
Industrial relations are the relationships between employees and employers within the organizational settings. The field of industrial relations looks at the relationship between management and workers, particularly groups of workers represented by a union. Industrial relations are basically the interactions between employers, employees and the government, and the institutions and associations through which such interactions are mediated.
The term industrial relations have a broad as well as a narrow outlook.
Originally, industrial relations were broadly defined to include the relationships and interactions between employers and employees. From this perspective, industrial relations cover all aspects of the employment relationship, including human resource management, employee relations, and union-management (or labor) relations. Now its meaning has become more specific and restricted. Accordingly, industrial relations pertains to the study and practice of collective bargaining, trade unionism, and labormanagement relations, while human resource management is a separate, largely distinct field that deals with nonunion employment relationships and the personnel practices and policies of employers.
The relationships which arise at and out of the workplace generally include the relationships between individual workers, the relationships between workers and their employer, the relationships between employers, the relationships employers and workers have with the organizations formed to promote their respective interests, and the relations between those organizations, at all levels. Industrial relations also includes the processes through which these relationships are expressed (such as, collective bargaining, workers’ participation in decision-making, and grievance and dispute settlement), and the management of conflict between employers, workers and trade unions, when it arises.
For better understanding of industrial relations, various terms need to be defined here:
Industry:
Industrial Disputes Act 1947 defines an industry as any systematic activity carried on by co-operation between an employer and his workmen for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes whether or not any capital has been invested for the purpose of carrying on such activity; or such activity is carried on with a motive to make any gain or profit. Thus, an industry is a whole gamut of activities that are carried on by an employer with the help

2 of his employees and labors for production and distribution of goods to earn profits.
Employer:
An employer can be defined from different perspectives as:-
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A person or business that pays a wage or fixed payment to other person(s) in exchange for the services of such persons.
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A person who directly engages a worker/employee in employment.
Any person who employs, whether directly or through another person or agency, one or more employees in any scheduled employment in respect of which minimum rates of wages have been fixed.
As per Industrial Disputes Act 1947 an employer means:-

In relation to an industry carried on by or under the authority of any department of
[the Central Government or a State Government], the authority prescribed in this behalf, or where no authority is prescribed, the head of the department;
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In relation to an industry carried on by or on behalf of a local authority, the chief executive officer of that authority;
Employee: -
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Employee is a person who is hired by another person or business for a wage or fixed payment in exchange for personal services and who does not provide the services as part of an independent business.
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An employee is any individual employed by an employer.
A person who works for a public or private employer and receives remuneration in wages or salary by his employer while working on a commission basis, piece-rates or
 time rate.
Employee, as per Employee State Insurance Act 1948, is any person employed for wages in or in connection with work of a factory or establishment to which the act applies.
In order to qualify to be an employee, under ESI Act, a person should belong to any of the categories:

Those who are directly employed for wages by the principal employer within the premises or outside in connection with work of the factory or establishment.
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Those employed for wages by or through an immediate employer in the premises of the factory or establishment in connection with the work thereof those employed for wages by or through an immediate employer in connection with the factory or establishment outside the premises of such factory or establishment under the supervision and control of the principal employer or his agent.

Employees whose services are temporarily lent or let on hire to the principal employer by an immediate employer under a contract of service (employees of security contractors, labor contractors, house keeping contractors etc. come under this category).
Employment: The state of being employed or having a job.
Labor market:
The market in which workers compete for jobs and employers compete for workers. It acts as the external source from which organizations attract employees. These markets occur because

3 different conditions characterize different geographical areas, industries, occupations, and professions at any given time.
Industrial Relation System
An industrial relations system consists of the whole gamut of relationships between employees and employees and employers which are managed by the means of conflict and cooperation.
A sound industrial relations system is one in which relationships between management and employees (and their representatives) on the one hand, and between them and the State on the other, are more harmonious and cooperative than conflict and creates an environment conducive to economic efficiency and the motivation, productivity and development of the employee and generates employee loyalty and mutual trust.
Actors in the IR system:
Three main parties are directly involved in industrial relations:
Employers: Employers possess certain rights vis-à-vis labors. They have the right to hire and fire them. Management can also affect workers’ interests by exercising their right to relocate, close or merge the factory or to introduce technological changes.
Employees: Workers seek to improve the terms and conditions of their employment. They exchange views with management and voice their grievances. They also want to share decision making powers of management. Workers generally unite to form unions against the management and get support from these unions.
Government: The central and state government influences and regulates industrial relations through laws, rules, agreements, awards of court ad the like. It also includes third parties and labor and tribunal courts.
SCOPE:
The concept of industrial relations has a very wide meaning and connotation. In the narrow sense, it means that the employer, employee relationship confines itself to the relationship that emerges out of the day to day association of the management and the labor. In its wider sense, industrial relations include the relationship between an employee and an employer in the course of the running of an industry and may project it to spheres, which may transgress to the areas of quality control, marketing, price fixation and disposition of profits among others.
The scope or industrial relations are quite vast. The main issues involved here include the following:
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Collective bargaining.
Machinery for settlement of industrial disputes.

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Standing orders.
Workers participation in management.
Unfair labor practices.
Importance of Industrial Relations:
The healthy industrial relation is a 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 reduces 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. Wastages 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:-

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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.
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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.
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To raise productivity to a higher level in an era of full employment by lessening the tendency to high turnover and frequency absenteeism.
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To raise productivity to a higher level in an era of full employment by lessening the tendency to high turnover and frequency absenteeism.
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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.
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To eliminate or minimize the number of strikes, lockouts and gheraos by providing reasonable wages, improved living and working conditions, said fringe benefits.
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To improve the economic conditions of workers in the existing state of industrial managements and political government.
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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.
Dunlop's Contribution to Industrial Relations
One of the significant theories of industrial labor relations was put forth by John Dunlop in the
1950s. According to Dunlop industrial relations system consists of three agents – management organizations, workers and formal/informal ways they are organized and government agencies.
These actors and their organizations are located within an environment – defined in terms of technology, labor and product markets, and the distribution of power in wider society as it impacts upon individuals and workplace. Within this environment, actors interact with each other, negotiate and use economic/political power in process of determining rules that constitute the output of the industrial relations system. He proposed that three parties—employers, labor unions, and government-- are the key actors in a modern industrial relations system. He also argued that none of these institutions could act in an autonomous or independent fashion. Instead they were shaped, at least to some extent, by their market, technological and political contexts.
Thus it can be said that industrial relations is a social sub system subject to three environmental constraints- the markets, distribution of power in society and technology.
Dunlop's model identifies three key factors to be considered in conducting an analysis of the management-labor relationship:
1.
Environmental or external economic, technological, political, legal and social forces that impact employment relationships.
2.
Characteristics and interaction of the key actors in the employment relationship: labor, management, and government.
3.
Rules that are derived from these interactions that govern the employment relationship.
Dunlop emphasizes the core idea of systems by saying that the arrangements in the field of industrial relations may be regarded as a system in the sense that each of them more or less intimately affects each of the others so that they constitute a group of arrangements for dealing with certain matters and are collectively responsible for certain results”.

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In effect - Industrial relations is the system which produces the rules of the workplace. Such rules are the product of interaction between three key “actors” – workers/unions, employers and associated organizations and government
The Dunlop’s model gives great significance to external or environmental forces. In other words, management, labor, and the government possess a shared ideology that defines their roles within the relationship and provides stability to the system.
COLLECTIVE BARGAINING
Bargaining form and tactics
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 program 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.
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.

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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 employmentrelated 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.
Collective bargaining generally includes negotiations between the two parties (employees’ representatives and employer’s representatives). Collective bargaining consists of negotiations between an employer and a group of employees that determine the conditions of employment.
Often employees are represented in the bargaining by a union or other labor organization. The result of collective bargaining procedure is called the collective bargaining agreement (CBA).
Collective agreements may be in the form of procedural agreements or substantive agreements.
Procedural agreements deal with the relationship between workers and management and the procedures to be adopted for resolving individual or group disputes.
This will normally include procedures in respect of individual grievances, disputes and discipline. Frequently, procedural agreements are put into the company rule book which provides information on the overall terms and conditions of employment and codes of behavior.
A substantive agreement deals with specific issues, such as basic pay, overtime premiums, bonus arrangements, holiday entitlements, hours of work, etc. In many companies, agreements have a fixed time scale and a collective bargaining process will review the procedural agreement when negotiations take place on pay and conditions of employment.
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.

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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.
Collective bargaining includes not only negotiations between the employers and unions but also includes the process of resolving labor-management conflicts. Thus, collective bargaining is, essentially, a recognized way of creating a system of industrial jurisprudence. It acts as a method of introducing civil rights in the industry, that is, the management should be conducted by rules rather than arbitrary decision making. It establishes rules which define and restrict the traditional authority exercised by the management.
Importance to employees
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Collective bargaining develops a sense of self respect and responsibility among the employees.
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It increases the strength of the workforce, thereby, increasing their bargaining capacity as a group.
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Collective bargaining increases the morale and productivity of employees.
It restricts management’s freedom for arbitrary action against the employees.
Moreover, unilateral actions by the employer are also discouraged.
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Effective collective bargaining machinery strengthens the trade unions movement.
The workers feel motivated as they can approach the management on various matters and bargain for higher benefits.

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The workers feel motivated as they can approach the management on various matters and bargain for higher benefits.
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It helps in securing a prompt and fair settlement of grievances. It provides a flexible means for the adjustment of wages and employment conditions to economic and technological changes in the industry, as a result of which the chances for conflicts are reduced.
Importance to employers
1.
It becomes easier for the management to resolve issues at the bargaining level rather than taking up complaints of individual workers.
2.
Collective bargaining tends to promote a sense of job security among employees and thereby tends to reduce the cost of labor turnover to management.
3.
Collective bargaining opens up the channel of communication between the workers and the management and increases worker participation in decision making.
4.
Collective bargaining plays a vital role in settling and preventing industrial disputes.
Importance to society
1.
Collective bargaining leads to industrial peace in the country
2.
It results in establishment of a harmonious industrial climate which supports which helps the pace of a nation’s efforts towards economic and social development since the obstacles to such a development can be reduced considerably.
3.
The discrimination and exploitation of workers is constantly being checked.
4.
It provides a method or the regulation of the conditions of employment of those who are directly concerned about them.
Collective bargaining operates at three levels:
1. National level
2. Sector or industry level
3. Company/enterprise level
Economy-wide (national) bargaining is a bipartite or tripartite form of negotiation between union confederations, central employer associations and government agencies. It aims at providing a floor for lower-level bargaining on the terms of employment, often taking into account macroeconomic goals.
Sectoral bargaining, which aims at the standardization of the terms of employment in one industry, includes a range of bargaining patterns. Bargaining may be either broadly or narrowly defined in terms of the industrial activities covered and may be either split up according to territorial subunits or conducted nationally.

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The third bargaining level involves the company and/or establishment. As a supplementary type of bargaining, it emphasizes the point that bargaining levels need not be mutually exclusive.
TRADE UNIONS
Trade unions are formed to protect and promote the interests of their members. Their primary function is to protect the interests of workers against discrimination and unfair labor practices.
Trade unions are formed to achieve the following objectives:
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Representation: Trade unions represent individual workers when they have a problem at work. If an employee feels he is being unfairly treated, he can ask the union representative to help sort out the difficulty with the manager or employer.
Unions also offer their members legal representation. Normally this is to help people get financial compensation for work-related injuries or to assist people who have to take their employer to court.
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Negotiation: Negotiation is where union representatives, discuss with management, the issues which affect people working in an organization. There may be a difference of opinion between management and union members. Trade unions negotiate with the employers to find out a solution to these differences. Pay, working hours, holidays and changes to working practices are the sorts of issues that are negotiated.
In many workplaces there is a formal agreement between the union and the company which states that the union has the right to negotiate with the employer. In these organizations, unions are said to be recognized for collective bargaining purposes.
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Voice in decisions affecting workers: The economic security of employees is determined not only by the level of wages and duration of their employment, but also by the management’s personal policies which include selection of employees for lay offs, retrenchment, promotion and transfer. These policies directly affect workers.
The evaluation criteria for such decisions may not be fair. So, the intervention of unions in such decision making is a way through which workers can have their say in the decision making to safeguard their interests.

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Member services: During the last few years, trade unions have increased the range of services they offer their members. These include: o Education and training - Most unions run training courses for their members on employment rights, health and safety and other issues. Some unions also help members who have left school with little education by offering courses on basic skills and courses leading to professional qualifications. o Legal assistance - As well as offering legal advice on employment issues, some unions give help with personal matters, like housing, wills and debt. o Financial discounts - People can get discounts on mortgages, insurance and loans from unions. o Welfare benefits - One of the earliest functions of trade unions was to look after members who hit hard times. Some of the older unions offer financial help to their members when they are sick or unemployed.
Trade unions perform a number of functions in order to achieve the objectives. These functions can be broadly classified into three categories:
(i) Militant functions,
(ii) Fraternal functions
Militant Functions
One set of activities performed by trade unions leads to the betterment of the position of their members in relation to their employment. The aim of such activities is to ensure adequate wages, secure better conditions of work and employment, get better treatment from employers, etc.
When the unions fail to accomplish these aims by the method of collective bargaining and negotiations, they adopt an approach and put up a fight with the management in the form of goslow tactics, strike, boycott, gherao, etc. Hence, these functions of the trade unions are known as militant or fighting functions. Thus, the militant functions of trade unions can be summed up as:
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To achieve higher wages and better working conditions.
To raise the status of workers as a part of industry.
To protect labors against victimization and injustice.
Fraternal Functions
Another set of activities performed by trade unions aims at rendering help to its members in times of need, and improving their efficiency. Trade unions try to foster a spirit of cooperation and promote friendly industrial relations and diffuse education and culture among their members. They take up welfare measures for improving the morale of workers and generate self confidence among them. They also arrange for legal assistance to its members, if necessary.
Besides, these, they undertake many welfare measures for their members, e.g., school for the education of children, library, reading-rooms, in-door and out-door games, and other recreational facilities. Some trade unions even undertake publication of some magazine or journal. These activities, which may be called fraternal functions, depend on the availability of funds, which the unions raise by subscription from members and donations from outsiders, and also on their competent and enlightened leadership. Thus, the fraternal functions of trade unions can be summed up as:
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To take up welfare measures for improving the morale of workers.
To generate self confidence among workers.
To encourage sincerity and discipline among workers.
To provide opportunities for promotion and growth.
To protect women workers against discrimination.

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The existence of a strong and recognized trade union is a pre-requisite to industrial peace.
Decisions taken through the process of collective bargaining and negotiations between employer and unions are more influential. Trade unions play an important role and are helpful in effective communication between the workers and the management. They provide the advice and support to ensure that the differences of opinion do not turn into major conflicts. The central function of a trade union is to represent people at work. But they also have a wider role in protecting their interests. They also play an important educational role, organizing courses for their members on a wide range of matters. Seeking a healthy and safe working environment is also prominent feature of union activity.
Trade unions help in accelerated pace of economic development in many ways as follows:
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By helping in the recruitment and selection of workers.
By inculcating discipline among the workforce.
By enabling settlement of industrial disputes in a rational manner.
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By helping social adjustments. Workers have to adjust themselves to the new working conditions, the new rules and policies. Workers coming from different backgrounds may become disorganized, unsatisfied and frustrated. Unions help them in such adjustment.
Trade unions are a part of society and as such, have to take into consideration the national integration as well. Some important social responsibilities of trade unions include:
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Promoting and maintaining national integration by reducing the number of industrial disputes.
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Incorporating a sense of corporate social responsibility in workers.
Achieving industrial peace.
The important forces that make the employees join a union are as follows:
1. Greater Bargaining Power
The individual employee possesses very little bargaining power as compared to that of his employer. If he is not satisfied with the wage and other conditions of employment, he can leave the job. It is not practicable to continually resign from one job after another when he is dissatisfied. This imposes a great financial and emotional burden upon the worker. The better course for him is to join a union that can take concerted action against the employer. The threat or actuality of a strike by a union is a powerful tool that often causes the employer to accept the demands of the workers for better conditions of employment.
2. Minimize Discrimination
The decisions regarding pay, work, transfer, promotion, etc. are highly subjective in nature. The personal relationships existing between the supervisor and each of his subordinates may influence the management. Thus, there are chances of favoritisms and discriminations. A trade union can compel the management to formulate personnel policies that press for equality of treatment to the workers. All the labor decisions of the management are under close scrutiny of the labor union. This has the effect of minimizing favoritism and discrimination.
3. Sense of Security
The employees may join the unions because of their belief that it is an effective way to secure adequate protection from various types of hazards and income insecurity such as accident, injury, illness, unemployment, etc. The trade union secure retirement benefits of the workers and compel the management to invest in welfare services for the benefit of the workers.

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4. Sense of Participation
The employees can participate in management of matters affecting their interests only if they join trade unions. They can influence the decisions that are taken as a result of collective bargaining between the union and the management.
5. Sense of Belongingness
Many employees join a union because their co-workers are the members of the union. At times, an employee joins a union under group pressure; if he does not, he often has a very difficult time at work. On the other hand, those who are members of a union feel that they gain respect in the eyes of their fellow workers. They can also discuss their problem with’ the trade union leaders.
6. Platform for self expression
The desire for self-expression is a fundamental human drive for most people. All of us wish to share our feelings, ideas and opinions with others. Similarly the workers also want the management to listen to them. A trade union provides such a forum where the feelings, ideas and opinions of the workers could be discussed. It can also transmit the feelings, ideas, opinions and complaints of the workers to the management. The collective voice of the workers is heard by the management and give due consideration while taking policy decisions by the management.
7. Betterment of relationships
Another reason for employees joining unions is that employees feel that unions can fulfill the important need for adequate machinery for proper maintenance of employer-employee relations.
Unions help in betterment of industrial relations among management and workers by solving the problems peacefully.
INDUSTRIAL DISPUTES
The causes of industrial disputes can be broadly classified into two categories: economic and non-economic causes. The economic causes will include issues relating to compensation like wages, bonus, allowances, and conditions for work, working hours, leave and holidays without pay, unjust layoffs and retrenchments.
The non economic factors will include victimization of workers, ill treatment by staff members, sympathetic strikes, political factors, indiscipline etc.
Wages and allowance s: Since the cost of living index is increasing, workers generally bargain for higher wages to meet the rising cost of living index and to increase their standards of living.
In 2002, 21.4% of disputes were caused by demand of higher wages and allowances. This percentage was 20.4% during 2003 and during 2004 increased up to 26.2%. In 2005, wages and allowances accounted for 21.8% of disputes.
Personnel and retrenchment: The personnel and retrenchment have also been an important factor which accounted for disputes. During the year 2002, disputes caused by personnel were
14.1% while those caused by retrenchment and layoffs were 2.2% and 0.4% respectively. In
2003, a similar trend could be seen, wherein 11.2% of the disputes were caused by personnel, while 2.4% and 0.6% of disputes were caused by retrenchment and layoffs. In year 2005, only
9.6% of the disputes were caused by personnel, and only 0.4% was caused by retrenchment.
Indiscipline and violence: From the given table, it is evident that the number of disputes caused by indiscipline has shown an increasing trend. In 2002, 29.9% of disputes were caused because of indiscipline, which rose up to 36.9% in 2003. Similarly in 2004 and 2005, 40.4% and 41.6%

14 of disputes were caused due to indiscipline respectively. During the year 2003, indiscipline accounted for the highest percentage (36.9%) of the total time-loss of all disputes, followed by cause-groups wage and allowance and personnel with 20.4% and11.2% respectively. A similar trend was observed in 2004 where indiscipline accounted for 40.4% of disputes.
Bonus: Bonus has always been an important factor in industrial disputes. 6.7% of the disputes were because of bonus in 2002 and 2003 as compared to 3.5% and 3.6% in 2004 and 2005 respectively.
Leave and working hours: Leaves and working hours have not been so important causes of industrial disputes. During 2002, 0.5% of the disputes were because of leave and hours of work while this percentage increased to 1% in 2003. During 2004, only 0.4% of the disputes were because of leaves and working hours.
Miscellaneous: The miscellaneous factors include
- Inter/Intra Union Rivalry
- Charter of Demands
- Work Load
- Standing orders/rules/service conditions/safety measures
- Non-implementation of agreements and awards etc.
The number of industrial disputes in country has shown slow but steady fall over the past ten years. In 1998, the total number of disputes was 1097 which fell by more than half to 440 in
2006.It is being estimated that this trend will continue in 2007 as well. To support this, only 45 cases of disputes have been recorded during the first four months of 2007. This significant decline is attributed to the serious attempts made by industries to improve industrial relations with their workers. However, a deeper look at the data reveals that the number of mandays (i.e., the industrial unit of production equal to the work one person can produce in a day) lost due to disputes has not come down as significantly. The country, on an average, lost 25.4 million
Mondays of work annually between 1998 and 2006, which might have affected its industrial output.
More than 2.14 lakh Mondays were lost due to work stoppages in 23 industrial disputes during
January to March 2007. Though there has been a decline in the number of strikes, the country still witnessed some major strikes between 2004 and 2006, like those in Honda, Escorts, Apollo, and Skumars factories and in SBI bank.
A strike is a very powerful weapon used by trade unions and other labor associations to get their demands accepted. It generally involves quitting of work by a group of workers for the purpose of bringing the pressure on their employer so that their demands get accepted. When workers collectively cease to work in a particular industry, they are said to be on strike.
According to Industrial Disputes Act 1947, a strike is “a cessation of work by a body of persons employed in an industry acting in combination; or a concerted refusal of any number of persons who are or have been so employed to continue to work or to accept employment; or a refusal under a common understanding of any number of such persons to continue to work or to accept employment”. This definition throws light on a few aspects of a strike. Firstly, a strike is a referred to as stoppage of work by a group of workers employed in a particular industry.
Secondly, it also includes the refusal of a number of employees to continue work under their employer.

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In a strike, a group of workers agree to stop working to protest against something they think is unfair where they work. Labors withhold their services in order to pressurize their employment or government to meet their demands. Demands made by strikers can range from asking for higher wages or better benefits to seeking changes in the workplace environment. Strikes sometimes occur so that employers listen more carefully to the workers and address their problems.
Causes of strikes:
Strikes can occur because of the following reasons:
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Dissatisfaction with company policy.
Salary and incentive problems.
Increment not up to the mark.
Wrongful discharge or dismissal of workmen.
Withdrawal of any concession or privilege.
Hours of work and rest intervals.
Leaves with wages and holidays.
Bonus, profit sharing, Provident fund and gratuity.
Retrenchment of workmen and closure of establishment.
Dispute connected with minimum wages.
TYPES OF STRIKE
1. Economic Strike: Under this type of strike, labors stop their work to enforce their economic demands such as wages and bonus. In these kinds of strikes, workers ask for increase in wages, allowances like traveling allowance, house rent allowance, dearness allowance, bonus and other facilities such as increase in privilege leave and casual leave.
2. Sympathetic Strike: When workers of one unit or industry go on strike in sympathy with workers of another unit or industry who are already on strike, it is called a sympathetic strike.
The members of other unions involve themselves in a strike to support or express their sympathy with the members of unions who are on strike in other undertakings. The workers of sugar industry may go on strike in sympathy with their fellow workers of the textile industry who may already be on strike.
3. General Strike: It means a strike by members of all or most of the unions in a region or an industry. It may be a strike of all the workers in a particular region of industry to force demands common to all the workers. These strikes are usually intended to create political pressure on the ruling government, rather than on any one employer. It may also be an extension of the sympathetic strike to express generalized protest by the workers.
4. Sit down Strike: In this case, workers do not absent themselves from their place of work when they are on strike. They keep control over production facilities. But do not work. Such a strike is also known as 'pen down' or 'tool down' strike. Workers show up to their place of employment, but they refuse to work. They also refuse to leave, which makes it very difficult for employer to defy the union and take the workers' places. In June 1998, all the Municipal
Corporation employees in Punjab observed a pen down strike to protest against the nonacceptance of their demands by the state government.
5. Slow Down Strike: Employees remain on their jobs under this type of strike. They do not stop work, but restrict the rate of output in an organized manner. They adopt go-slow tactics to put pressure on the employers.
6. Sick-out (or sick-in): In this strike, all or a significant number of union members call in sick on the same day. They don’t break any rules, because they just use their sick leave that was

16 allotted to them on the same day. However, the sudden loss of so many employees all on one day can show the employer just what it would be like if they really went on strike.
7. Wild cat strikes: These strikes are conducted by workers or employees without the authority and consent of unions. In 2004, a significant number of advocated went on wildcat strike at the
City Civil Court premises in Bangalore. They were protesting against some remarks allegedly made against them by an Assistant Commissioner.
A lockout is a work stoppage in which an employer prevents employees from working. It is declared by employers to put pressure on their workers. This is different from a strike, in which employees refuse to work. Thus, a lockout is employers’ weapon while a strike is raised on part of employees. Acc to Industrial Disputes Act 1947, lock-out means the temporary closing of a place of employment or the suspension of work or the refusal by an employer to continue to employ any number of persons employed by him.
A lockout may happen for several reasons. When only part of a trade union votes to strike, the purpose of a lockout is to put pressure on a union by reducing the number of members who are able to work.
For example, if a group of the workers strike so that the work of the rest of the workers becomes impossible or less productive, the employer may declare a lockout until the workers end the strike. Another case in which an employer may impose a lockout is to avoid slowdowns or intermittent work-stoppages. Occupation of factories has been the traditional method of response to lock-outs by the workers' movement.
PICKETING
When workers are dissuaded from work by stationing certain men at the factory gates, such a step is known as picketing. If picketing does not involve any violence, it is perfectly legal.
Pickets are workers who are on strike that stand at the entrance to their workplace. It is basically a method of drawing public attention towards the fact that there is a dispute between the management and employees.
The purpose of picketing is:
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 to stop or persuade workers not to go to work. to tell the public about the strike. to persuade workers to take their union's side
GHERAO
Gherao in Hindi means to surround. It denotes a collective action initiated by a group of workers under which members of the management are prohibited from leaving the industrial establishment premises by workers who block the exit gates by forming human barricades. The workers may gherao the members of the management by blocking their exits and forcing them to stay inside their cabins. The main object of gherao is to inflict physical and mental torture to the person being gheraoed and hence this weapon disturbs the industrial peace to a great extent.
In 1990, 1,825 strikes and lockouts were recorded. As a result, 24.1 million workdays were lost, from which 10.6 million were lost to strikes and 13.5 million to lockouts. More than 1.3 million workers were involved in these labor disputes. The number and seriousness of strikes and lockouts have varied from year to year. As can be seen from the below chart, there has been a steep decline in the number of strikes and lockouts. This continuous decline in strikes and lockouts indicates that the industrial relations in India are improving. There were 227 strikes in

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2005, resulting in the loss of 10.81 million man-days, while the number of lockouts stood at 229 with a loss of 18.86 million man-days. In January-September 2006, there were only 154 strikes and 192 lockouts across the country, as compared to the statistics of 2005, which resulted in the time loss of 3.16 million man-days and 10.60 million man-days respectively.
During 2000, 426 strikes and 325 lockouts were observed which resulted in total time-loss of
28.76 million Mondays. Maximum time-loss was caused by 297 lockouts during 2003 which resulted in a time-loss of 27.05 million Mondays. As compared to previous years, in 2006 only
13.76 million Mondays were lost due to strikes and lockouts.
Employees are prohibited from striking according to the section 22 of Industrial Disputes Act
1947. Employees, who are working in a public utility service, cannot go on a strike without giving a notice of strike within the six weeks before striking. They can not go on strike either within fourteen days of providing the strike notice or before the expiry of the date of strike specified in any such notice. The same rule applies to the employers. Employers who are carrying on a public utility service can not lockout any of their employees without giving them a prior notice within six weeks before the lock out or within the fourteen days of giving such a notice. Moreover, the notice of strike or lockout is to be given in a prescribed manner showing the number of persons involved in the strike/lockout.
The notice of strike or lockout is not necessary when there is already a strike or lockout going on in the company. However, a notice should be issued on the day on which the lockout is declared just to intimate the appropriate authorities about the lockout. The employer is supposed to report the number of notices of strikes received by him to the appropriate Government or the authority prescribed by the government within the five days of receiving such notices.
Illegal Strikes and Lock-Outs
A strike or a lock-out is illegal if it is declared in noncompliance with the section 22 (as defined above) of Industrial Disputes Act 1947, that is, if the notice period is not served or if the strike is held within the fourteen days of issuing the notice of strike. If a strike or lockout has already taken place and is being referred to a Board, the continuance of such a strike or lock out is not illegal provided it is in compliance with the provisions of act. Moreover, a lockout declared in consequence of an illegal strike or a strike declared in consequence of an illegal lock-out shall not be deemed to be illegal.
Penalty for Illegal Strikes and Lock-outs
A workman who is involved in an illegal strike can be penalized with imprisonment for a term extendable to a month or with a fine or fifty rupees or both. In similar way, an employer who initiates and continues a lockout is punishable with imprisonment extendable to a month or with a fine of one thousand rupees or both. According to Section 25 of Industrial Disputes Act 1947, no person should provide any sort of financial aid to any illegal strike or lock-out. Any person who knowingly provides such a help in support of any illegal strike or lock-out is punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
The following measures should be taken to achieve good industrial relations:
Strong and Stable Union: A strong and stable union in each industrial enterprise is essential for good industrial relations. The employers can easily ignore a weak union on the plea that it hardly represents the workers. The agreement with such a union will hardly be honored by a large section of workforce. Therefore, there must be strong and stable unions in every enterprise to

18 represent the majority of workers and negotiate with the management about the terms and conditions of service.
Mutual Trust: Both management and labor should help in the development of an atmosphere of mutual cooperation, confidence and respect. Management should adopt a progressive outlook and should recognize the rights of workers. Similarly, labor unions should persuade their members to work for the common objectives of the organization. Both the management and the unions should have faith in collective bargaining and other peaceful methods of settling disputes.
Workers’ Participation in Management: The participation of workers in the management of the industrial unit should be encouraged by making effective use of works committees, joint consultation and other methods. This will improve communication between managers and workers, increase productivity and lead to greater effectiveness.
Mutual Accommodation: The employers must recognize the right of collective bargaining of the trade unions. In any organization, there must be a great emphasis on mutual accommodation rather than conflict or uncompromising attitude. One must clearly understand that conflicting attitude does not lead to amicable labor relations; it may foster union militancy as the union reacts by engaging in pressure tactics. The approach must be of mutual “give and take rather than “take or leave.” The management should be willing to co-operate rather than blackmail the workers.
Sincere Implementation of Agreements: The management should sincerely implement the settlements reached with the trade unions. The agreements between the management and the unions should be enforced both in letter and spirit. If the agreements are not implemented then both the union and management stop trusting each other. An environment of uncertainty is created. To avoid this, efforts should be made at both ends to ensure the follow up of the agreements.
Sound Personnel Policies: The following points should be noted regarding the personnel policies. The policies should be:
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Formulated in consultation with the workers and their representatives if they are to be implemented effectively.
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Clearly stated so that there is no confusion in the mind of anybody.
Implementation of the policies should be uniform throughout the organization to ensure fair treatment to each worker.
Government’s Role:
The Government should play an active role for promoting industrial peace. It should make law for the compulsory recognition of a representative union in each industrial unit. It should intervene to settle disputes if the management and the workers are unable to settle their disputes. This will restore industrial harmony.
Progressive Outlook: There should be progressive outlook of the management of each industrial enterprise. It should be conscious of its obligations and responsibilities to the owners of the business, the employees, the consumers and the nation. The management must recognize the rights of workers to organize unions to protect their economic and social interests.

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