Assignment Code: MMPH–004/TMA/ JULY/2023

Course Code: MMPH–004

Assignment Name: Industrial and Employment Relations

Year: 2023

Verification Status: Verified by Professor

Q1) Briefly explain the approaches of industrial and employment relations.

Ans) Industrial and employment relations refer to the complex interactions between employers, employees, and the government in the world of work.

The Unitarist Approach: The unitarist approach views the organization as an integrated and harmonious entity where everyone shares common goals. It assumes that conflicts are minimal and temporary, and that any disputes arise from misunderstandings.

In unitarism, the focus is on creating a unified workplace culture where management and employees work together toward the achievement of organizational objectives. Conflict is seen as a disruption to this unity and is to be resolved through effective communication and consensus-building. This approach often aligns with a paternalistic leadership style.

The Pluralist Approach: Contrastingly, the pluralist approach assumes that conflicts are inherent in the employment relationship due to the divergent interests and values of diverse groups in the workplace. Pluralists acknowledge the existence of various interest groups such as trade unions, management, and employees, each pursuing their own objectives.

Unlike the unitarist perspective, pluralism accepts that conflicts can be unavoidable and that organizations need a formalized system to manage these conflicts. The emphasis is on bargaining, negotiation, and the involvement of multiple stakeholders in decision-making processes.

The Marxist Approach: The Marxist or radical approach to industrial and employment relations takes a critical stance toward the existing capitalist system. It views the employment relationship as inherently exploitative, with management representing the interests of the bourgeoisie and employees representing the proletariat.

According to Marxists, true industrial relations can only be achieved through the abolition of the capitalist system, emphasizing the need for collective ownership and control of the means of production. This approach often aligns with the ideology of labour movements and socialist or communist political perspectives.

The HRM (Human Resource Management) Approach: The HRM approach focuses on managing people as valuable assets to achieve organizational goals. Unlike traditional personnel management, HRM emphasizes strategic integration, employee development, and a commitment to creating a high-performance work culture. It seeks to align individual and organizational goals, emphasizing employee participation, training, and development. HRM aims to create a positive and cooperative work environment where employees are viewed as partners in the business.

The Strategic Approach: The strategic approach integrates HRM practices with overall business strategy. It views employment relations as a strategic element that can contribute to the organization's competitive advantage. This approach considers the alignment between HR practices, organizational culture, and business goals. It emphasizes flexibility, innovation, and responsiveness to external market conditions.

The Employee-Centred Approach: This approach places a strong emphasis on employee rights, welfare, and well-being. It highlights the importance of fair treatment, job security, and work-life balance. Employee-centred approaches often overlap with HRM practices that focus on employee engagement, satisfaction, and retention. In this perspective, employees are seen as key stakeholders whose interests should be safeguarded.

Q2) Discuss the role of the ILO in improving labour conditions in India.

Ans) The International Labour Organization (ILO) plays a significant role in shaping labour conditions globally, and its impact on India has been substantial. Established in 1919 as a specialized agency of the United Nations, the ILO aims to promote social justice and fair labour practices worldwide. In the context of India, the ILO has been instrumental in influencing labour policies, promoting decent work, and addressing various challenges faced by the Indian workforce.

Formulation of Labor Standards: The ILO sets international labour standards through conventions and recommendations. India, as a member state, actively participates in the development and adoption of these standards. These standards cover a wide range of labour issues, including fundamental principles and rights at work, occupational safety, and health, working conditions, and social security. By adhering to these standards, India commits to providing decent work and safeguarding the rights and well-being of its workers.

Technical Assistance and Capacity Building: The ILO provides technical assistance and capacity-building support to its member states, including India, to strengthen their labour institutions and policies. This assistance encompasses a variety of areas such as labour market governance, skills development, social dialogue, and the implementation of labour laws. The ILO's expertise and guidance contribute to building the capacity of Indian institutions to address emerging labour challenges effectively.

Decent Work Agenda: The ILO's Decent Work Agenda is a global framework that emphasizes four key pillars: employment creation, social protection, rights at work, and social dialogue. In the Indian context, the ILO has actively promoted the concept of decent work, encouraging policies that focus not only on job creation but also on ensuring fair wages, safe working conditions, and workers' rights. This agenda aligns with India's own efforts to enhance the quality of employment.

Elimination of Child Labour: Child labour is a persistent challenge in India. The ILO has been actively involved in supporting India's efforts to eliminate child labour through various projects and initiatives. The ILO's Convention No. 182 on the Worst Forms of Child Labour provides a framework for action, and India has taken steps to align its legislation with international standards. The ILO's technical assistance and collaboration with government and non-governmental organizations have contributed to the development and implementation of effective strategies against child labour.

Social Dialogue and Tripartism: The ILO encourages the practice of social dialogue, involving governments, employers, and workers in decision-making processes. In India, the ILO promotes tripartite consultations, which involve representatives of the government, employers, and workers coming together to discuss and negotiate labour policies. This approach ensures that the perspectives of all stakeholders are considered, leading to more inclusive and effective labour laws and regulations.

Capacity Building for Trade Unions and Employers' Organizations: The ILO supports the capacity building of trade unions and employers' organizations in India. By strengthening these entities, the ILO contributes to the development of a robust industrial relations system. This involves providing training, resources, and guidance to worker and employer representatives to enhance their ability to engage in constructive social dialogue and negotiations.

Addressing Informality in the Labor Market: A sizeable portion of India's workforce operates in the informal sector, facing challenges such as lack of job security, social protection, and access to basic rights. The ILO collaborates with India to address issues related to informality by promoting formalization, social protection schemes, and inclusive labour policies.

Q3) Describe the salient features of Industrial Relations Code, 2020.

Ans) The Industrial Relations Code 2020 is a landmark legislative initiative aimed at reforming labour laws in India. With its primary objective being the advancement of the country and the facilitation of business activities, the Code focuses on safeguarding the rights of both employers and employees, fostering labour reforms, and establishing industrial peace and harmony by effectively settling disputes. The Code amalgamates three crucial laws – The Trade Unions Act, 1926; Industrial Employment (Standing Orders) Act, 1946; and The Industrial Disputes Act, 1947.

Features of the Industrial Relations Code 2020:

1. Broadened Definition of Worker: The Code expands the definition of a worker, now encompassing working journalists, employees of sales promotion, and individuals employed in a supervisory capacity earning less than Rs. 18,000 per month or any amount notified by the Central Government.

2. Legal Basis for Fixed-Term Employment: It provides a legal foundation for fixed-term employment, offering employers greater flexibility in hiring based on organizational needs. Fixed-term employees now enjoy equality with permanent employees in terms of working conditions, wages, allowances, and benefits.

3. Applicability Threshold: The Code applies to industrial establishments with 300 or more employees, with provisions for the "appropriate government" to grant exemptions to certain establishments from specific Code provisions.

4. Multiplicity of Unions: In situations with multiple unions, the bargaining union status is granted to the one with 51% of employees as members. Additionally, the provision allows for the creation of a bargaining council with representatives from various unions.

5. Government Permission for Layoffs and Closures: Industrial establishments covered by the Code must seek government permission for layoffs, staff reductions, and closures, emphasizing the need for prior approval in such scenarios.

6. Regulation of Strikes and Lockouts: The Code defines a strike as the concerted casual vacation on a given day by fifty percent or more of workers in an industry. Both employees and employers are required to provide a 14-day notice before striking or locking out, respectively, with these notifications valid for a maximum of 60 days.

7. Standing Orders for Establishments with 300 or More Employees: Provisions regarding standing orders are applicable to establishments with 300 or more employees, requiring employers to prepare a draft of standing orders within six months from the Code's start date, in consultation with recognized bargaining unions or members of the negotiating council.

8. Reskilling Fund: A significant inclusion is the creation of a "reskilling fund" for employees laid off, with contributions from employers. The fund is equivalent to 15 days of the last drawn salary of the worker before being laid off.

9. Approval Requirement for Lay-offs and Retrenchment: Non-seasonal industrial establishments with at least 300 workers need prior approval from the central or state government before implementing lay-offs, retrenchments, or closures.

10. Redressal Committees for Dispute Resolution: Establishments employing more than 20 employees must have one or more complaint redressal committees for resolving disputes arising from individual complaints. These committees ensure equal representation from employers and workers, with the chair elected alternately from among employees and workers.

Q4) Enumerate the types and features of the Industrial Federations and Central Federations functioning in India.

Ans) In the Indian trade union movement, industrial federations form the second tier in the hierarchical structure, playing a crucial role in addressing common problems faced by workers within a specific industry. These federations operate at both regional and national levels, bringing together plant-level and locality-level unions. The primary purpose is to effectively resolve industry-wide issues, supplementing the efforts of local unions.

Industrial Federations: Industrial federations, operating at regional and national levels, bring together unions from various units within an industry. Examples include the Indian National Mine Workers’ Federation, Indian National Iron and Steel Workers’ Federation, All Indian Railwaymen’s Federation, and Indian National Defence Workers’ Federation. These federations deal with familiar challenges cutting across different units and contribute to collective bargaining forums. Factors such as the setting up of Wage Boards, increased reliance on industry-level collective bargaining, and the formation of industrial committees have facilitated the formation and strengthening of these federations.

The First National Commission on Labour has acknowledged the positive trend, emphasizing the effectiveness of such national federations in collective bargaining and educational activities. Regional-level industrial federations, like the UP Chini Mazdoor Federation and the Bihar Sugar Workers’ Federation, may operate independently or become constituents of national-level federations. The affiliation with national centres or remaining independent depends on the preferences of these regional federations.

It is worth noting that not all industries have industrial federations, and those that do may not have the affiliation of all primary unions within the industry. Political affiliations of primary unions may lead to the creation of rival federations under different political parties. For instance, in the coal mining industry, there are parallel federations affiliated with different central federations.

Central Federations: Central federations sit at the apex of the trade union movement in India. Affiliated primary unions, regional, and industrial federations align themselves with central federations based on convenience and political inclinations. These central federations coordinate activities, provide guidance, and formulate broad policies, giving a national character to the overall trade union movement.

Major central federations include AITUC, INTUC, HMS, CITU, and BMS. These federations may have political affiliations with parties like the Communist Party of India, Indian National Congress, or Rastriya Swayamsevak Sangh. State branches of central federations manage their affairs with guidance from the central bodies. While central federations offer support to their affiliates during crises, the real centres of trade union activity are the affiliates themselves. Central federations may intervene by providing publicity, appealing for funds, and offering political support during industrial disputes. However, their role in the actual negotiations at lower levels is limited.

Industrial federations and central federations play pivotal roles in representing the interests of workers, ensuring their rights, and fostering harmonious industrial relations in India. These entities are instrumental in negotiating with employers, advocating for labour-friendly policies, and contributing to the overall development of the labour force.

Representation of Specific Industries: Industrial federations are typically sector-specific, representing workers employed industries such as manufacturing, textiles, or construction. They focus on addressing industry-specific challenges and negotiating for sector-specific labour reforms.

Collective Bargaining: One of the primary functions is engaging in collective bargaining on behalf of the workers to secure better wages, working conditions, and benefits.

Central federations often collaborate with industrial federations to formulate collective bargaining strategies at a broader level.

Policy Advocacy: Federations actively participate in policy advocacy, voicing concerns related to labour laws, social security, and other regulatory matters. They work towards influencing policy decisions at the national and regional levels to protect the rights and interests of the workers.

Conflict Resolution: Industrial federations and central federations play a crucial role in resolving conflicts between employers and workers through negotiation and mediation. They work towards preventing industrial disputes and strikes through dialogue and consensus-building.

Skill Development and Training: Many industrial federations focus on skill development and training programs for workers in their respective industries. These initiatives aim to enhance the employability of workers and address the changing skill requirements in evolving industries.

Legal Representation: Federations provide legal representation to workers in case of disputes, ensuring that their rights are protected, and legal recourse is available when needed. They may initiate legal actions or support individual workers in legal proceedings.

Political Advocacy: Central federations engage in political advocacy to influence labour-related policies and regulations at the national level. They may collaborate with political parties, participate in policy discussions, and present the concerns of the labour force.

Welfare Activities: Federations often undertake welfare activities for workers, including health and safety programs, insurance benefits, and support for workers' families. These initiatives contribute to the overall well-being of the workforce.

Education and Awareness: Federations conduct educational programs and awareness campaigns to inform workers about their rights, entitlements, and changes in labour laws. This helps empower workers with knowledge about their legal protections and responsibilities.

Collaboration with Government Bodies: Federations collaborate with government bodies to participate in tripartite forums, where representatives from labour, management, and government discuss and formulate labour-related policies.

International Collaboration: Some central federations engage in international collaborations and affiliations with global labour organizations, fostering cross-border cooperation and sharing best practices.

Ensuring Gender Inclusivity: Modern industrial federations are increasingly focusing on gender inclusivity, advocating for the rights and interests of female workers, and addressing gender-based discrimination.

Q5) Give an account of various theories on collective bargaining.

Ans) Various models of collective bargaining have been developed, drawing on social psychology, economics, and management theories. These models provide insights into the dynamics of negotiations between employers and labour unions.

Walton and McKersie Theory:

Developed by Richard E. Walton and Robert B. McKersie, this theory identifies four sub-processes in collective bargaining.

Sub-Processes:

1. Distributive Bargaining: Involves conflicting goals between union and management.

2. Integrative Bargaining: Addresses issues not necessarily in conflict with the other party.

3. Attitudinal Structuring: Focuses on building friendly, trusting, and cooperative relationships.

4. Intra-organizational Bargaining: Examines interactions within the union and management.

5. Outcome: The interactions of these sub-processes shape the outcome of negotiations and the long-term relationship between union and management.

Bargaining Range Theory:

Rooted in the work of A.C. Pigou, this theory explains how labour and management establish upper and lower wage limits within which a settlement is reached.

1. Process: Both sides establish upper and lower limits. Through proposals and counterproposals, they navigate toward a settlement point influenced by bargaining skills and strengths.

2. Limitations: The settlement point depends on negotiators' skills, and both parties have predetermined limits.

   
   

Chamberlain Model:

Developed by Edward Chamberlain, this model focuses on the determinants of bargaining power.

1. Bargaining Power: Defined as the ability to secure the opponent's agreement to one's terms.

2. Decision-Making: The union's decision to agree or disagree depends on the perceived costs of disagreement versus agreement.

3. Implications: Bargaining power is relative, affected by factors such as the size of wage increases, misjudgement, and the economic environment.

   
   

Hicks Bargaining Model:

Proposed by John Hicks, this model focuses on the length and costs of work stoppages in negotiations.

1. Balancing Act: Negotiators balance the costs and benefits of a work stoppage when making concessions.

2. Relation Between Wage and Strike Length: The model suggests a functional relation between the wage one party will accept and the anticipated length of a strike.

3. Difference from Bargaining Range Theory: Hicks model pinpoints a precise wage settlement, unlike the broader range theory.

   
   

Comparative Analysis:

1. Common Thread: All models emphasize the importance of balancing interests, building relationships, and considering the costs and benefits associated with agreements and disagreements.

2. Diversity: The models vary in their focus, ranging from specific sub-processes in bargaining to determining bargaining power and predicting strike lengths.