A STUDY ON“INDUSTRIAL RELATIONS”

In

RASHTRIYA ISPAT NIGAM LIMITED

VISAKHAPATNAM STEEL PLANT

A Project Report Submitted in partial fulfillment of

requirements for the award of the degree of
BACHELOR OF BUSINESS ADMINISTRATION

Submitted
By
P.NOOKA SAI KRISHNA
Reg.No. – 118134207047
Under the guidance of
Mrs. J.MANOGNA
LECTURER IN COMMERCE AND MANAGEMENT

TSR & TBK DEGREE COLLEGE

(VISAKHAPATNAM-530026)
(AFFILIATED TO ANDHRA UNIVERSITY)
 CERTIFICATE

This is to certify that this project work entitled ‘A STUDY ON INDUSTRIAL

RELATIONS” at RASHTRIYA ISPAT NIGAM LIMITED, VISAKHAPATNAM is a
bonafide work done and submitted by P.NOOKA SAI KRISHNA during under my
guidance and supervision partial fulfillment of the requirements for award of degree of
“BACHELOR OF BUSSINESS ADMINISTRATION“ during the period of 2020-2021.

Mrs. J.MANOGNA Mrs. V.D.N SUBHASHINI

Lecturer in commerce and management Head of the department,
Commerce and Management.

EXTERNAL EXAMINER
 DECLARATION

I Mr. P.NOOKA SAI KRISHNA hereby declare that the project work titled a study on
“INDUSTRIAL RELATIONS” with reference to Rashtriya Ispat Nigam Limited,
Visakhapatnam is the original work done by me and submitted to T.S.R. & T.B.K.
DEGREE COLLEGE from Andhra university in partial fulfillment of requirements for the
award of Bachelor degree in H.R. is a record of original work done and submitted to RINL,
Visakhapatnam Steel Plant

Place: Visakhapatnam, P.NOOKA SAI KRISHNA

Date : (118134207047)
 ACKNOWLEDGEMENT

I hereby take this opportunity to express my sincere gratitude to the following

eminent personalities whose aid and advice helped me to complete this project work
successfully without any difficulty.
I would like to forward my sincere thanks and gratitude to Mrs. V.D.N
SUBHASHINI, head of the department for commerce and management, TSR & TBK
DEGREE COLLEGE for giving an opportunity and support to do the project work.
I sincerely thank Mrs. J.MANOGNA, my internal guide in faculty department
of commerce and management to partially guided me in completion of my project work.
I have great pleasure in expressing my profound gratitude to Mr. K. Sanjeeva Roa,
DGM (HR) - IR, vizag steel plant for a valuable support and guidance during the entire
course of the project work.
I would also like to extend my gratitude to my parents and friends without whose help and
advice this project would not have been possible.

(P.NOOKA SAI KRISHNA)

118134207047
 INDEX

Serial No. Topic Page No.

Introduction
Objectives
Chapter-1 Characteristics
Need of the study 1–4
Data collection
Methodology
Limitations

Chapter-2 Industry profile

Company profile 5-31

Chapter-3 Theoretical frame work 32 - 62

Chapter-4 Data analysis & Interpretation 63 -85

Summary
Chapter-5 Findings & Suggestions
Conclusion 86 -95
Annexures
Bibliography
CHAPTER -I
 INTRODUCTION

INTRODUCTION

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.”

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).

DEFINITION:

According to ID act 1947 Industry means – “any systematic activity carried on by

cooperation between an employer & his workmen for the production of goods or services
with a view to satisfy human wants or wishes.”(Not for spiritual needs). Relations mean the
relation that exists between the employer and his workmen. The term Industrial relations
mean that cooperative relationship which exists between the employer and the employees.

According to J Henry Richardson - Industrial relations may be referred as an art of

living together for the purposes of production. Industrial relations are that part of
management which is concerned with the manpower of the enterprise. Industrial relations
have a very important concept of the science of management because it deals with the man
power of enterprise.

Scope of Industrial relations:

The concept of Industrial relations has a very wide scope. In the narrow sense it
means that the employer-employee relationship is confined to the relation that emerges out of
the day-to-day association of management and labor. In its wider sense, IR includes the
relation between employees and employer in course of running of an industry and may
project itself into spheres.

An industry is a social world in miniature. The interaction between workmen-supervisory

staff, management and employer creates industrial relationships. This relationship affects the
economic, social and political life of the whole community. Industrial relations are therefore
inherent in an Industrial life.

These include:
--Labor relations i.e. relations between Trade unions and management
--Employer and employee relations

1
 --Group relations, i.e. relations between industry and society.

The scope of industrial relations is quite vast. The main issues involved here
include the following:

1. Collective bargaining
2. Machinery for settlement of industrial disputes
3. Standing orders
4. Workers participation in management
5. Unfair labor practices

Characteristics of IR:

 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
.
 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.

 To raise productivity to a higher level in an era of full employment by lessening the

tendency to high turnover and frequency absenteeism
.
 To eliminate or minimize the number of strikes, lockouts and gheraos by providing
reasonable wages, improved living and working conditions, said fringe benefits.

 To improve the economic conditions of workers in the existing state of industrial

managements and political government.

Objectives of the study:

The healthy industrial relations are key to the progress and success. Its objective is to:

 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.

 To eliminate or minimize the number of strikes, lockouts and gears by providing

reasonable wages, improved living and working conditions, said fringe benefits.

 To improve the economic conditions of workers in the existing state of industrial

managements and political government.

 Socialization of industries by making the state itself a major employer

2
  Vesting of a proprietary interest of the workers in the industries in which they are
employed.

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.

Need for the study:

The development of any organization depends on good Industrial Relations, which

involved both management and workers. Until and unless there is commitment from both
sides good IR cannot be achieved.

Every organization faces a problem in maintaining good relations; this may be due to man,
money, machinery and material, labor, community in particular and eventually the nation’s
economy.

Steel comprises one of the most important inputs in all sectors of economy. Stell industry is
both a basic and core industry. The economy of any nation depends on a strong base of iron
and steel industry in that nation

The steel industry is both capital and labor intensive. The working conditions are also very
hazardous. So maintenance of Good Industrial Relations plays a very vital role since it has
directive impact on the production and productivity of an industry.

In the case of Visakhapatnam Steel Plant a Public Sector Unit, study industrial relations at
Visakhapatnam Steel Plant is very helpful to me to get experience on Industrial Relations.

.1.6 Methodology:

The Project Scenario entitled “HEALTHY INDUSTRIAL RELATIONS” was carried

out for a period of 8 weeks at Visakhapatnam Steel Plant, Visakhapatnam.

Data collection:

The study was carried out by collecting and analyzing the data collected both from
Primary and Secondary sources.

Primary data collection methods:

Primary Data was collected by personal discussions with managers and the
employees. A Questionnaire was prepared and administered on a sample of 50 was
distributed to the employees in the administration building in VSP. The data collected is

3
 analyzed to know the perception of executives, non-executives and unskilled labor towards
their role in maintaining the cordial Industrial Relations.

Secondary data collection methods:

This data includes the lectures from the head of the departments and so on. Secondary
data is collected from Company Records, In-house Magazines, and Internet regarding the
Industry and company profile and also about Industrial Relations events in Visakhapatnam
Steel Plant right from its inception. Some more data is collected from the company journals.

Limitations of the study:

The data opinions, observations and conclusions expressed here are collected by survey and
literature provided by Visakhapatnam Steel Plant.
Following are the few constraints faced during the study. One of the most limiting factors
for a thorough and complete study of the subject has been the insufficient period of study.

The survey was conducted on the sample based upon random selection; random
selection has its own defects.

1 The size of the sample representing the universe is very small

.
2 We were given limited number of employees to work with and we lacked
information from working group inside the plant.

4
 CHAPTER 2

STEEL INDUSTRY PROFILE

COMPANY PROFILE

5
 STEEL INDUSTRY PROFILE

Steel comprises one of the most important inputs to all sectors of the economy. Steel Industry
is both a basic and a core Industry. The economy of any nation depends on a strong base of
Iron and Steel Industry in that nation. History has shown that the countries having a strong
potential for Iron and Steel Industry have played a prominent role in the advancement in the
civilization in the world.

Steel is such a versatile commodity that every object we see in our day to day life has used
for such small items as nails, pins, needles etc., to surgical instruments, agricultural
implements, boilers, ships, railway materials, automobile parts. The great investments that
has gone into the fundamental research in Iron and Steel Technology has helped both directly
and indirectly many modern fields of today’s science and technology. Steel is versatile and
indispensable item.

The versatility of steel can be traced mainly of three reasons.

1 It is only metallic item, which can be conveniently and economically produced in
tonnage quality.
2 It has got very good strength coupled with malleability
3 Its properties can be changed over a wide range. Its properties can be manipulated to
any extent by proper heat treatment techniques.

Iron and Steel making as a craft has been known to India for a long time.
However, its production in significant quantities only after 1900.

Pre-Independence Era:
By 1950 the total installed capacity for ingot steel production was 1.5 million tons per year.
In 1830 James Heath constructed the first manufacturing plant at port Nova in Madras
Presidency. But it was a financial failure.
In 1874 James Erskine founded the Bengal Iron works. It was passed on to M/s.
Hoare Hiller and Co. in 1882 and to M/s. Martin and Co. in 1885. In 1899 Jamshedji Tata
initiated the scheme for an integrated steel plant. In 1906 Sakhi in Bihar was chosen as the
site for the “Tata Iron and Steel Company”. The same place is known as Jamshedpur. In
1918 initially “Indian Iron and Steel Company” was founded and the “Bengal Iron and Steel
Company” was merged with it in 1920. TISCO produced steel in 1939. Between 1940-50
formation of major Iron and Steel at Bhadravti in Karnataka owing to the pioneering effort of
Shri.Visveswarayya in 1936 it started manufacturing steel and after 1945 adopted electric
reduction of Iron ore. It has also started manufacturing Ferro alloys and special steel.

Post-Independence period:

After the Independence the Government has taken steps to improve the Steel Industry from
the following Five-Year Plans.

6
  First Five year plan (1951-1956)
No new steel plant came up. The Hindustan Steel Limited was born in the year 1954 with the
decision of setting up 3 plants each with one million tones ingot steel per year at Rourkela,
Bhopal and Durgapur, TISCO started its expansion program.

 Second Five year plan (1956-1961)

A bold decision was taken up to increase the ingot steel output in India to 6 million tons per
year and the production at Rourkela, Bhilai and Durgapur steel plant started. Rourkela steel
plant was established with the collaboration of West Germany, Bhilai steel plant with USSR
and Durgapur steel plant with Britain.

 Third Five year plan (1961-1966)

During the plan, the 3 steel plants under Hindustan Steel Limited (Rourkela, Bhilai and
Durgapur) Plants were expanded. In January 1964, Bokaro Steel Plant came into existence.

 Fourth Five year plan (1969-1974)

Salem Steel Plant started. Government of India gave permission for setting up Steel Plant in
south at Visakhapatnam. Steel Authority of India Limited was formed during this period on
24th January 1973.

 Fifth Five Year Plan (1974-1979)

The idea of setting up the 5 th integrated Steel Plant, the Ore-based plant at Visakhapatnam
took a definite shape. At the end of the fifth five-year plan, the total installed capacity from 6
integrated plants was 10.6 million tones.

 Annual plan (1979-1980)

The erstwhile Soviet Union agreed to help in setting up of the Visakhapatnam Steel Plant.

 Sixth Five year plan (1980-1985)

The construction activities were started at Visakhapatnam Steel Plant with a big bang and top
priority was accorded to start the plant. Schemes for modernization of Bhilai Steel Plant,
Rourkela Steel Plant, Durgapur Steel Plant and Tata Iron and Steel Company were initiated.
Capacity at the end of sixth five year plan from 6 integrated plants stood 11.5 million tones.

 Seventh five year plan (1986-1991)

Expansion work at Bhilai and Bokaro Steel Plant was completed. Progress of Visakhapatnam
Steel Plant picked up and the rationalized concept has been introduced to commission the
plant with 3 million ton capacity by 1990.

 Eight Five year plan (1992-1997)

The Visakhapatnam Steel Plant was commissioned in 1992. The plant started its production
and its cost became around Rs.8, 755 cores. Modernization of other steel plants was also
duly envisaged.

 Ninth Five year plan (1997-2002)

Visakhapatnam steel plant had foreseen a 7% growth during the entire plan period.

7
  Tenth Five Year Plan (2002-2007)
Steel industry registers the growth of 9.9 % Visakhapatnam steel plant high
regime targets achieved the best of them.

 Eleventh Five Year Plan (2007-2012)

Steel industry is trying to achieve its vision and mission by 2010 or during this entire plan
period.

The technology revolution in steel making has led to the problems of today. Until the
1980’s barriers to entry in the Industry were prohibitive. With new steel making technologies,
the structure of the Industry changes in the mid-1980. With the addition of new capacity
through the mid-1990, supply exceeded demand for the first time in the century, leading to
severe competition in the world market.
The pricing structure in the past 20 years has grown increasingly “competitive”. But
with each passing year, an ever rising number of steel mills the world over have come to
believe that their production actions make no difference when it comes it pricing. The
strategy has to maximize the output as long as prices remain above their marginal cost.
Hence price competition has grown severe, even at high operating rates.
With capacity additions becoming easier, surplus capacity particularly in developing regions
will be a problem in the coming years. The world steel market in 2001 moved largely
downhill, with volume and prices sinking rapidly over the year until early 2002.

Looking back to the mid-1990 the global steel industry has suffered through,
1. In 1995, a pricing “death spiral” when the global economy was rising.
2. In 1998 a “death spiral” when the global economy was stagnant after the Asian
Financial Crisis.
3. In 2000, a “death spiral” when the global economy was booming
4. In the second half of 2001, after a moderate recovery in the first half of the year, a
renewed price collapse.

The world leaders in steel production were the Erst-while Soviet Union, the United States, the
United Kingdom, France and Germany. However over the last 25 years, there has been a
shift from the western to the eastern hemisphere. Now China is the largest producer in the
world. India, with a capacity of 34 million tones with an actual production of 30 million
tones, continues to have unutilized capacity. One exception is RashtriyaIspat Nigam Limited
which has raised its production by 10 per cent with all major units exceeding their rated
capacities with the initiatives taken by the Government in meeting infrastructure needs, the
demand for steel has started showing significant improving.

8
 At present India is the 10th largest producer of steel in the world. In India, a major part of
steel is consumed in engineering applications, followed by automobiles and construction.
The growth of steel, as is well known, is dependent upon the growth of the economy,
industrial production and infrastructure sectors. Over the last few years the performance of
the Indian steel industry has been adversely affected due to overcapacity, cheap imports,
economic slowdown, declining global steel prices and also anti-dumping duty imposed by
USA on Indian exports. Most major steel companies, with the exception of Tata Steel, have
thus been reporting losses.

However, the initial indications are that 2002 would be a better year as far as demand is
concerned. Of late there has been some revival in the automobile sector. The demand for two-
wheelers, passenger cars and HCV segment are witnessing a recovery. This recovery in the
automobile sector is expected to benefit the steel industry. Any step up in government
expenditure on infrastructure projects is also likely to benefit the steel sector.

Industry Classification

The industry classification based on product categories and the major producers can be
divided into the following:

Iron ore – National Mineral Development Corporation (NMDC), Kudremukh Iron Ore Co
(KIOCL) and Sesa Goa (Sesa) are the major merchant producers of iron ore. SAIL and Tata
Steel have their captive.
Pig iron – KIOCL, Sesa Goa and Usha Ispat. Apart from them there are many mini blast
furnace (MBF) pig iron producers and even integrated steel plants of SAIL and RINL
produce a significant amount of pig iron.

Sponge Iron – Essar Steel, Ispat Industries, Vikram Ispat (a division of Grasim) are the
major producers of gas based sponge iron.

Flat steel products:

SAIL, Tata Steel, Essar Steel, Ispat Industries and Jindal Vijaynagar (JVSL) are the major
producers of hot rolled coils (HRC). SAIL, Tata Steel, Ispat Industries, Jindal group of
companies, Uttam Steel and Bhushan Steel are the big producers of cold rolled coils/sheets
(CRC) and galvanized sheets 9GP/GC).

Long products – RINL, SAIL and Tata Steel are the major producers of long products.
Alloy Steel products – Mukand, Mahindra Ugine (Musco) and Kalyani Carpenter are some
of the largest producers of alloy steel in the country, which is primarily used, in automotive
and engineering applications.

9
 Based on the routes of production, the industry and major producers can be classified into the
following categories;

Integrated producers – SAIL, RINL, Tata Steel and JVSL are the largest primary steel
producers.
Secondary users – Essar Steel, Ispat Industries and Lloyds steel are the largest producers of
steel through the secondary route production.

THE MAJOR STEEL AND RELATED COMPANIES IN INDIA

1. Bharat Refectories Ltd.

2. Hindustan Steel Works Construction Ltd.
3. Jindal Steel and Power Ltd.
4. Kudremukh Iron Ore Company Ltd.
5. Manganese ore (India) Ltd.
6. Metal Scrap Trade Corporation Ltd.
7. Metallurgical and Engineering Consultants India Ltd.
8. National Mineral Development Corporation (NMDC).
9. Rashtriya Ispat Nigam Ltd.
10. Sponge Iron India Ltd.
11. Steel Authority of India ltd.
12. Tata Iron Steel Company.

The global steel industry has witnessed several revolutionary changes during the last century.
The changes have been in the realms of both technology & business strategy. The ultimate
object of all these changes is to remain competitive and open global market.

The Indian steel industry is growing very rigorously with the major producers like SAIL,
RINL, TISCO, JVL and many others. Our steel industry has amply demonstrated its ability of
adopts to the changing scenario and to survive in the global market that is becoming
increasingly competitive. This has been possible to a large extent due to the adoption of
innovative operating practices and modern technologies.
Industrial Development in India has reached a high degree of self-reliance, and the steel
industry occupies a primary place in the strategy for future development. At present the
production of steel industry country is 34Mt. the public sector steel industry has been
restructured to meet challenges and a separate fund has been established for modernization
and future development of the industry. It is now being proposed that Indian steel industry
should Gear up to achieve a production level of about 100 Mt by the year2000.

GLOBAL SCENARIO (As per IISI)

1. In March’ 2005 world Crude steel output was 928Mt when compared to march 2004
(872Mt), ∙The change in percentage was 6.5%.

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 2. China remained the world largest crude steel producer in 2005 also
(275Mt) followed by Japan (96Mt) and USA (81Mt). India occupied 8 th position
(42Mt).

3. USA remained the largest importer of semi-finished and finished products in 2002
followed by China and Germany.

4. Japan remained the largest exporter of semi-finished and finished steel products in
2002 followed by Russia and Ukraine.

5. Other significant recent developments in the global steel scenario have been: Under
the auspices of the OECD (Organization for Economic Co-operation & Development)
the negotiations among the major steel producing countries for a steel subsidy
agreement (SSA) held in 2003 with the objective to agree on a complete negotiating
test for the SSA by the Middle of 2004. It also set subsidies for the steel industry of a
ceiling of 0.5% of the value of production to be used exclusively for Research &
Development

6. The global economy witnessed a gradual recovery from late 2003 on words. China
has become one of the major factors currently driving the world economy.

7. As a result of these economic developments IISI has projected an increase by 6.2% or

5.3 Mt in 2004 in the global consumption of finished steel products. IISI has split the
growth into two separate areas, china and the rest of the world (ROW). Steel
consumption in china has been estimated to increase by 13.1% or 31Mt in 2004.

8. USA has repealed the safeguard measures on import of steel as a result of a ruling by
a WTO dispute resolution panel, which held these measures to be illegal under the
WTO regime.

MARKET SCENARO

The year 2004-05 was a remarkable one for the steel industry with the world crude
steel production crossing the one billion marks for the first time in the history of the steel
industry. The world GDP growth about 4% lends supports to the expectations the steel
market is all set for strong revival after prolonged period of depression .The Indian economy
also become robust with annual growth rates of 7-8 % this will provide a major boost the
steel industry. With the nations focus on infrastructure development coupled with the growth
in the manufacturing sector, the Indian steel industry all set for northward movement. The
draft national steel police envisage production of 60 Mt by 2012 and 110Mt by2020, and
annual growth rate of 6-7%. All this should therefore augur well for the Indian steel industry.

11
Growth Potential of India’s Steel Industry
India has traditionally been one of the major producers of steel in the world. Till the 1990s
the steel industry of India was regulated and controlled by government policies.

After the economic reforms of the early 1990s, the Indian steel industry has evolved
significantly to conform to global standards.

India has set a vision to be an economically developed nation by 2020. The steel industry is
expected to play a major role in India's economic development in the coming years. The steel
industry of India has a very high growth potential and is expected to register significant
growth in the coming decades. India is expected to emerge as a strong force in the global
steel market in coming years.

The two major aspects that are expected to play a significant role in the growth of the steel
industry in India are –

1. Abundant availability of iron ore in the country.

2. The country has well established facilities for steel production.

Steel production in India has grown from 17 MT in 1990 to 36 MT in 2003. It is expected

that by 2011, the steel production in India will grow to 66 MT.

In the recent years a number of major steel corporations of the world have come flocking to
India to avail the benefits of the flourishing steel industry of India. The number of steel
projects in India has increased as well and this implies that the number of companiesliningup
to participate in these projects would be increasing too.

There are certain challenges that are being faced by the Indian steel industry of late. There are
certain issues regarding the condition of the infrastructural facilities available and the skill
level of the members of the steel fraternity.

The levels of skill of the various technical people associated with the steel industry has been
found to be wanting and this has been a result of the inability of the Indian steel industry to
attract the best people from the world of engineering and technology. The state of
infrastructure needs to be improved so that the production of steel can be taken to the next
level.

India has traditionally been regarded as one of the top steel producers of the world. In 2004 it
was ranked as the seventh largest producers of steel in the world, which is testimony to the
standing of the Indian steel industry of the world. India is also supposed to have the best
growth potential in the context of steel and is preceded only by China, which is a prominent
steel producing and consuming country of the world.

India's steel industry went through a rough phase between 1997 and 2001 when the overall
global steel was facing a downturn and recovered after 2002. The major factors that led to the
revival of the steel industry in India after 2002 were the rise in global demand for steel and
the domestic economic growth in India.

12
India has now emerged as the eighth largest producer of steel in the world with a production
capacity of 35MT. almost all varieties of steel is now produced in India. India has also
emerged as a net exporter of steel which shows that Indian steel is being increasingly
accepted in the global market.

13
 VISAKHAPATNAM STEEL PLANT PROFILE

HISTORY:

Steel in today’s economy has occupied a position inseparable from the human routine.
There is no place and no function, which the present day human can imagine working without
the use of steel. Naming a few, where we find these, recollecting the routine helps us. From
tongue cleaners to shaving kits and blades, from utensils to frying pans, from mugs to buckets
to water filters, from chassis to the engine of automobiles and the list goes on.

The GOVT. Of INDIA HAS RECOGNIZED THE IMPORTANCE OF STEEL IN INDIAN

INDUSTRY AND ESTABLISHED THE FOLLOWING STEEL PLANTS, BEFORE IT
ACTUALLY SET UP VSP/RINL. The DETAILS OF THOSE ARE TABULATED BELOW

TABLE

Sl.No. Steel plant Collaborated by

1 Durgapur steel plant Britain
2 Bhilai steel plant Erstwhile USSR
3 Bokaro steel plant Erstwhile USSR
4 Rourkela steel plant Germany

INTRODUCTION:

Steel occupies the foremost place amongst the materials in use today and pervades all walks
of life. All the key discoveries of the human genius – for instance, steam engine, railway,
means of communication and connection, automobile, aero plane and computers, are in one
way or other, fastened together with steel and with its sagacious and multifarious application.
Seeds were thus sown for the construction of a modern & sophisticated Steel Plant having
annual capacity of 3.4 Million Tons of hot metal. An agreement was signed between Gov-
ernments of India and the erstwhile USSR on June 12th, 1979 for setting up of an Integrated
Steel Plant to produce structural & long products on the basis of detailed Project report
prepared by M/s M.N. Dustur& Company. A Comprehensive revised DPR jointly prepared
by Soviets & M/s Dustur& Company was submitted in Nov' 1980 to Govt. of India

The project was estimated to cost Rs.8397.28 Cr. based on prices as on quarter of
1981. However, on completion of construction and commissioning of the whole plant in
1992, the cost escalated to around Rs.8, 500 Cr. Unlike other integrated steel plants in India,

14
 Visakhapatnam steel plant (VSP) is one of the most modern steel plants in the country. The
plant was dedicated to the nation on 1st August 1992 by the then Prime Minister, Shri PV
Narasimha Rao. The construction of the Plant started on 1st February 1982. Government of
India on 18th Feb'82 formed a new Company called RashtriyaIspat Nigam Ltd. (RINL).

New technology, large-scale computerization and automation etc., are incorporated in the
plant. To operate the plant at international levels and attain such labor productivity, the
organizational manpower has been rationalized. The plant has a capacity if producing 3.0 MT
of liquid steel and 2,656 MT of saleable steel.

MAJOR UNITS

Annual
Department Capacity Units (3.0 MT Stage)
(‘000 T)
Coke Ovens 2,261 4 Batteries of 67 Ovens &7 Meters. height
Sinter plant 5,256 2 Sinter machines of 312 Sq. Mtr. Grate area each
Blast furnace 3,400 2 Furnaces of 3200 Cu. Mtr. Volume each
3 LD Convertors each of 133 Cu. Mtr. Volume & six 4 strand bloom
Steel melt shop 3,000
casters
LMMM 710 4 stand finishing Mill
WRM 850 2x10 stand finishing Mill
MMSM 850 6 stand finishing Mill

Main Products of VSP

Steel Products By-Products

Angles Nut Coke Granulated Slag
Billets Coke Dust Lime Fines
Channels Coal Tar Ammonium Sulphate
Beams Anthracene Oil
Squares HP Naphthalene
Flats Benzene
Rounds Toluene
Re-bars Xylene
Wire Rods Wash Oil

15
Visakhapatnam Steel Plant Technology: state-of-the-art

 7 meter tall Coke Oven Batteries with coke dry quenching

 Biggest Blast Furnaces in the country
 Bell-less top charging system in Blast Furnace
 100% slag granulation at the Blast Furnace cast house
 Suppressed combustion – LD gas recovery system
 100% continuous casting of liquid steel
 “Tempcore” and “Stelmor” cooling process in LMMM & WRM respectively
 Extensive waste heat recovery systems
 Comprehensive pollution control measure

Major Sources of Raw Materials

RAW MATERIALS SOURCE

 Iron ore lumps & fines. Bailadilla, MP.

 BF limestone. Jaggayyapeta, AP.
 SMS limestone.
 BF dolomite. UAE.
 SMS dolomite. Madharam, AP.
 Manganese ore. Madharam, AP.
 Boiler coal.
 Coking coal. Gharbam, AP.
 Medium coking coal (MCC) Talcher, Orissa.
Australia.
Gidi/Swang/Rajarappa/Kargali.

Water supply:

Operational water requirement of 36 mgd is being met from the Yeleru water supply
scheme.

16
Power Supply:

Operational Power requirement of 180 to 200 MW is being met through captive

Power Plant. The capacity of the power plant is 286.5 MW. Visakhapatnam Steel Plant is
exporting 60MW power to Andhra Pradesh State Electricity Board (APSEB).

MAJOR DEPARTMENTS

 Raw Material Handling Plant:

VSP annually requires quality raw materials viz. Iron Ore, fluxes (Lime stone,
Dolomite), coking and non-coking coals etc. to the tune of 12-13 Million tons for producing 3
Million Tons of Liquid Steel. To handle such a large volume of incoming raw materials
received from different sources and to ensure timely supply of consistent quality of feed
materials to different VSP consumers, Raw Material Handling Plant serves a vital function.
This unit is provided with elaborate unloading, blending, stacking & reclaiming facilities.

 Coke ovens & Coal Chemical Plant (CO&CCP):

Blast Furnaces, the mother units of any Steel plant require huge quantities of strong, hard
and porous solid fuel in the form of hard metallurgical coke for supplying necessary heat for
carrying out the reduction and refining reactions besides acting as a reducing agent. At VSP
there are three Coke Oven Batteries, 7 Meter tall and having 67 Ovens each. Each oven is
having a volume of 41.6 cu. meters & can hold up to 31.6 tons of dry coal charge. There are 3
Coke Dry Cooling Plants (CDCP) each having 4 cooling chambers. Nitrogen gas is used as
the Cooling medium. The heat recovery from nitrogen is done by generating steam and
expanding in two backpressure turbines to produce 7.5 MW each.

The Coal chemicals such as Benzoyl (& its products), Tar (& its products), and
Ammonium Sulphate etc. are extracted in Coal Chemical Plant from C.O. Gas.

 Sinter Plant:
Sinter is a hard & porous ferrous material obtained by agglomeration of Iron Ore fines, Coke
breeze, Lime Stone fines, Metallurgical wastes viz. Flue dust, mill scale, LD slag etc. Sinter
is a better feed material to Blast Furnace in comparison to Iron Ore lumps and its usage in
Blast furnaces help in increasing productivity, decreasing the coke rate & improving the
quality of Hot Metal produced. Hot Sinter discharged from Sintering machine is crushed to
+5 mm - 50 mm size and cooled before dispatching to Blast Furnaces.

The dust laden air from the machines are cleaned in scrubbers & electrostatic
precipitators to reduce the dust content to 100 mg/ m3 level before allowing to escape into the
atmosphere and thus helping in maintaining a clean & dust free environment.

17
  Blast Furnaces:

VSP has two 3200 cu. meter Blast Furnaces (largest in India) equipped with Paul worth Bell
less top equipment with conveyor charging. Rightly named as “Godavari”&“Krishna“after
the two rivers of AP, the furnaces will help VSP in bringing prosperity to the state of Andhra
Pradesh.

Provision exists for granulation of 100% liquid slag at blast furnace cast house and
utilization of blast furnace gas top pressure (1.5-2.0 atmospheric pressure) to generate 12
MW of power in each furnace. The two furnaces are rated to produce 9720 tons of Hot
Metal daily or 3.4 Million tons of low Sulphur Hot Metal annually.

 Steel Melt Shop:

VSP produces steel employing three numbers of top blown Oxygen Converters called LD
Converters or Basic Oxygen Furnaces / Converters. Each converter is of 133 cu. Meter
volume, rated to produce 3 Million tons of Liquid Steel annually. Besides Hot Metal, Steel
Scrap, Fluxes such as calcined lime or Dolomite form part of the charge to the Converters.

This process can make different grades of steel of Superior quality by controlling
the Oxygen blow or addition of various Ferro alloys or special additives such as FeSi,
FeMn, SiMn, Coke Breeze, and Aluminum etc.

 Continuous casting Department:

VSP has six-4 strand continuous casting machines capable of producing

2.82 million tons / year Blooms of size 250 x 250 mm and 250 x 320 mm. Entire
quantity of molten steel produced (100%) is continuously cast in radial bloom casters
which help in energy conservation as well as production of superior quality products.
Facilities at continuous casting machines include a lift and Turn table for ladles,
Copper mold, oscillating system tundish, Primary & Secondary Cooling arrangement
To cool the steel bloom.

 Rolling Mills:

Blooms produced in SMS-CCD are shaped into products such as Billets, rounds,
squares, angles (equal & unequal), Channels, I-PE Beams, HE Beams, Wire rods and
reinforcements bars by rolling them in three sophisticated high capacity, high speed, fully
automated rolling mills, namely Light & Medium Merchant Mills (LMMM), Wire Rod Mill
(WRM) and Medium Merchant and Structural Mill (MMSM).

 Light & Medium Merchant Mill (LMMM):

LMMM comprises of two units. In the Billet/Break down mill 250 x 320 mm size blooms
are rolled into Billets of 125 x 125 mm size. Billets are supplied from this mill to Bar Mill

18
of LMMM & Wire Rod Mill. The Bar mill is facilitated with temp core heat treatment tech-
nology evaporative cooling system in walking beam furnaces, automated pilling & bundling
facilities, high degree of automation and computerization. The mill is designed to produce
710,000 tons per annum of various finished products.

 Wire Rod Mill (WRM):

Wire Rod Mill is fully automated & sophisticated mill. The billets are rolled in 4 strand, high-
speed continuous mill having a capacity of 8,50,000tons of Wire Rod Coils. The mill
produces rounds in 5.5 - 14 mm range and rebar’s in 8, 10 & 12 mm sizes. The mill is
equipped with standard and Retarded Stelmore controlled cooling lines for producing high
quality Wire rods in Low, Medium & High carbon grade meeting the stringent National &
International standards.

AUXILIARY FACILITIES:

 Power Generation & Distribution:

The average power demands at all units of VSP when operating the full capacity will be 221
MW. The captive generation capacity of 270 MW is sufficient to meet all the plant needs in
normal operation time. The short fall of power is availed from APSEB grid. The agreement
with APSEB provides for exporting of surplus power to APSEB. The captive generating
capacity comprises of

- TPP -247.5 MW (3x60 MW + 1 X 67.5 MW)

- Back pressure Turbines (C&CCD)* - 2 x 7.5 MW
- Gas Expansion Turbines (BF / ces)* - 2x12 MW

Power plant also meets the Air Blast requirements of Blast Furnaces through' 3 Turbo
blowers each of 6067 NM 3 / hr. capacity.

 Traffic Department:
A steel plant of the size of VSP has to handle around 60 to 65 MT traffic comprising of
incoming traffic in the form of raw materials and outgoing traffic in the form of finished or
saleable steel, and also the in process traffic such as cast pig iron, mill scrap, hot metal. Of
this 50% is transported by belt conveyors, 45% by Rail Transport and 5% by Road. VSP has
the distinction of having peripheral unloading system for the 1st time in Steel Industry.

 Engineering shops & Foundry (ES & F):

Engineering Shops are set up to meet the requirements of Ferrous & Non Ferrous spares of
different departments. This complex is divided into 1. Forge Shop 2. Structural shop
3.Foundry 4.Central machine shop 5. Wood Working Shop and 6. Utility Equipment Repair
Shop (UERS). In the Structural shops the fabricated structural of about 4500 tons are
produced annually and the input consisting of sheets, plates, channels, angles beams etc. In
Foundry Iron castings up to a weight of 5 tons and non-ferrous casting up to a weight of 1 ton
are produced. 2600 tons of iron castings and 200 tons of non-ferrous castings are produced
annually.

19
  Central Maintenance Electrical:
Maintenance of all H.T motors, L.T motors and DC motors of above 200KW. There are 810
such large rotating electrical machines spread throughout the plant including 3 Nos. of 60
MW Turbo-Generators, 1 No of 67.5M TG in TPP, 2 no's of Back Pressure Turbo Generators
of 7.5 MW each and 2 Nos. of Gas Expansion Turbo- Generator of 12 MW each. The
services provided are as mentioned below.

a) Repairs, Maintenance and condition monitoring of all rotating Electrical machines of

the plant. The job includes transportation, Overhauling and re-erection with precision
alignment.

b) Maintenance of Electrics of all streetlights, Tower lights and Weigh Bridges

throughout the plant.

Employee Profile:

RINL has a committed work force of 16,574 as on 01-04-2006. Out of

these, 3532 are executives, 1105 are in supervisory cadre and 11937 are non-executives. In
addition, there are about 7800 outsourced employees in many non-core activities in various
key and support processes. The age profile of the employees is given at (Tab.O.2 (i)) the
qualification profile of the employees is at (Tab.O.2 (ii)) and the distribution of manpower,
division-wise, is at (Tab.O.2 (iii)). VSP has rationalized the designations of non-executive
employees. VSP has introduced multi-skilling concept since inception and the employees are
trained as per this concept. VSP follows a system of overlapping shifts to ensure smooth
change over. Besides the regular manpower, about 5000 contract workers are on the rolls and
their safety and health requirements are fulfilled as per the certified OHSMS.

Age profile

(Years) >55 51- 55 41-50 30-40 <30

Executives(%) 5.11 10.96 43.84 37.11 2.98
Non-
executives(%) 2.24 6.4 50.72 40.4 0.24
Total(%) 3.04 7.67 48.79 39.48 1.01
Tab.O.2 (i)

Qualification profile

Qualification Graduate/PG Engg. Diploma ITI Literates/ Illiterates

Non-metriculates
Executives (%) 28.27 50.29 21.44 Nil Nil Nil

20
Non-Executives Nil
(%) 5.09 0.59 5.89 54.3 34.13
Total (%) 11.59 14.49 10.24 39.1 24.58 Nil
Tab.O.2 (ii)

Man power at a glance as on 31-03-2009-2010

Works Projects Mines Others Total

Executives 3249 329 93 1547 5218
Non 10476 63 267 1201 12007
Executives
TOTAL EMPLOYEES 17,225

Organizational structure:

The organization structure and supporting management structure is depicted at Fig.03

below. Besides the CMD and his team of Directors, there are two representatives of the GOI /
MOS on Board. The performance expectations of the key stakeholder i.e. MOS, are captured
through the annual MOU, which is drafted keeping in view, the vision, mission, values,
objectives and strategies and also taking stock of the company’s past performance and
capability. Annual sustainability plans are stretch targets drawn from MOU and our strategic
vision. The progress w.r.t. MOU is reviewed by the BOD every quarter and by CMD every
month.

Vizag Steel:

Thinking, learning … Vizag Steel has a history of overcoming odds right from
inception. Catapulted into the era of globalization & liberalization just after commissioning,
the journey of this young plant from ‘debts to dividend’ reiterates that, the sacrifice made by
those valiant people who gave up their lives in the struggle for the creation of Vizag Steel
was not in vain. Energy conservation, environmental preservation, safety in work place, and
occupational health gets highest priority in this regard are reproduced below.

 Quality Policy
 Environment Policy
 Energy Policy
 OSHAS Policy
 Human Resource Policy
 Human Resource Development Policy
 HRD Group – Key Initiatives
 Customer Policy
 Information Technology Policy

21
Quality Policy

Visakhapatnam Steel Plant Employees are committed to meet the needs and expectations of
our customers and other interested parties. To accomplish this, they will
 Supply quality goods and services to customers’ delight.
 Achieve quality of the products by following systematic approach through
planning, documented procedure and timely review of quality objectives.
 Continuously improve the quality of all materials, processes and products.
 Maintain an enabling environment, which encourages teamwork and active
involvement of all employees with their involvement.

Environment Policy

Visakhapatnam Steel Plant carrying out its operations without harming to the environment.
To accomplish this, they will
 Document, implement, maintain and continuously review the environmental
management system.
 Comply with all the relevant environmental legislations, regulations and other
requirements.
 Ensure continual improvement in the environmental performance and prevention
of pollution by minimizing the emissions and discharges.
 Maintain a high level of environmental consciousness amongst employees.
 Review the environmental objectives and targets on a continuous basis.

Energy Policy

Visakhapatnam Steel Plant is committed to optimally utilize various forms of energy in a

cost-effective manner to effect conservation of energy resources. To accomplish this, they
will
 Monitor closely and control the consumption of various forms of energy through
an effective Energy Management System.
 Adopt appropriate energy conservation technologies
 Maximize the use of cheaper and easily available forms of energy.

OSHAS Policy
Visakhapatnam Steel Plant is committed to occupational health and safety of employees and
contract workers. To accomplish this, the will

22
  Document, implement, maintain and periodically review the occupational health and
safety management system including the policy
 Comply with all the relevant occupational health and safety legislations, regulations
and other requirements.
 Ensure continual improvement in the environmental performance and prevention of
pollution by minimizing the emissions and discharges.
 Maintain a high level of environmental consciousness amongst employees.
 Review the environmental objectives and targets on a continuous basis.

Human Resource Policy

Visakhapatnam Steel Plant believes that their employees are the most important resources.
To realize the full potential of employees, the company is committed to

 Provide work environment that makes the employees committed and motivated
for maximizing productivity.
 Establish systems for maintaining transparency, fairness and equality in dealing
with employees.
 Empower employees for enhancing commitment, responsibility and
accountability.
 Encourage teamwork, creativity, innovativeness and high achievement orientation.
 Provide growth and opportunities for developing skill and knowledge.
 Ensure functioning of effective communication channels with employees.

Human Resource Development Policy

Visakhapatnam Steel Plant is committed to create an organizational culture, which nurtures

employees’ potential for the prosperity of the organization. To accomplish this, they will

 Identify development needs of the employees on a regular basis, provide the

necessary training and continually evaluate and monitor the effectiveness of the
training so that the quality of the training also gets updated.
 Provide inputs to the employees for developing their attitude towards work and for
matching their competencies with the organizational requirements.
 Create an environment of learning and knowledge sharing by providing the means
and facilities and also access to the relevant information and literature
 Facilitate the employees for continuous development of their knowledge base,
skills, efficiency, innovativeness, self-expression and behavior so that they

23
 contribute positively with commitment for the growth and prosperity of the
organization while maintaining a high level of motivation and satisfaction.
 Prepare employees through appropriate development programs for taking up
higher responsibilities in the organization.

HRD Group – Key Initiatives

 In – house Training Programs

 Nominations to External Training Programs
 Organization Research, Employees Satisfaction Surveys, Voice of Employees Index.
 Organization Development
 Membership with Professional bodies
 Performance Appraisal for Executives
 Human Resource Information System
 In – Plant training for Management Students
 Lectures by eminent personalities
 Corporate Presentations
 Interactions with professionals, academicians and consultants
 Knowledge Management
 Initiatives on “Six Sigma”
 Emancipation of women through WIPS, Women Development Programs (Spring Board)
 Thrust on “Samalochana”
 Pursuit of Business Excellence Model (BEM)

Customer Policy
 Visakhapatnam Steel Plant will Endeavour to adopt a Customer – focused approach at
all times with transparency
 Visakhapatnam Steel Plant will strive to meet more than the Customer needs and
expectations pertaining to Products, Quality, and Value for Money and Satisfaction.
 Visakhapatnam Steel Plant greatly values its relationship with Customers and would
make efforts at strengthening these relations for mutual benefit.

Information Technology Policy

RINL / VSP is committed to leverage Information Technology as the vital enabler in
improving the customer – satisfaction, organizational efficiency, Productivity, decision –
making, transparency and cost – effectiveness, and thus adding value to the business of steel
making.

24
Towards this, RINL shall:
 Follow best practices in Process Automation & Business Processes through IT by
in- house efforts / outsourcing and collaborative efforts with other organizations /
expert groups / institutions of higher learning etc., thus ensuring the quality of
product and services at least cost.

 Follow scientific and structured methodology in the software development

processes with total user – involvement, and thus delivering integrated and quality
products to the satisfaction of internal and external customers.

 Install, maintain and upgrade suitable cost – effective IT hardware, software and
other IT infrastructure and ensure high levels of data and information security.

 Strive to spread IT – Culture amongst employees based on organizational need,

role and responsibilities of the personnel and facilitate the objective of becoming
a world – class business organization.

 Enrich the skill – set and knowledge based of all related personnel at regular
intervals to make employees knowledge – employees

 Periodically monitor the IT investments made and achievements accrued to review

their cost effectiveness.

COMPANY’S CORPORATE SOCIAL RESPONSIBILITY

RINL’s concern for the society is reflected in its vision, mission, objectives and core
values. The statement, “We shall be a respected corporate citizen, ensure clean and green
environment and develop vibrant communities around us” forms a part of the vision of the
company. “Concern for environment” is one the five core values. Major CSR activities
undertaken by RINL are as under:

Environment
Education
Health Services
Peripheral Development
Sports and games
Contributions and Sponsorships
Promoting National Integration

25
With a view to improving the standard of living of the people in the neighboring
localities/villages and in the process improves its image; RINL has taken up some important
projects, which are indicated below.

1. Supply of drinking water to Gajuwaka (adjacent municipality)

2. Provision of roads and lighting in RH colonies
3. Donation of medical equipment to King George Hospital (KGH)
4. Construction of sports towers in port stadium, Visakhapatnam
5. Association in preparation of Visakhapatnam Development report
6. Major financial assistance for water pumping system from Godavari river to
Visakhapatnam
7. Financial assistance to agencies engaged in development of the mentally
challenged children

Apart from this, the company takes up publicity campaigns to make the people aware of the
products, services and performance of RINL. In order to maintain specific identity of RINL’s
products, the company initiated the process of branding its products. The TMT bars produced
at RINL have been branded as Vizag TMT and the structure’s as Vizag Ukku.

Training & Development

The needs of induction training, skill up gradation, unit training, computer related training,
refresher training, faculty development etc. are attended by the Training & Development
Centre while management development and attitudinal development are taken care at the
Centre for HRD.

Marketing Network

VSP has a wide network of regional offices and branch offices spread across the country for
marketing of its products. There are 5 Regional Offices and 23 Branch Offices. The details of

Region Location of Regional Branches

Office
East Kolkata Bhubaneswar, Kolkata, Patna
North Delhi Agra, Chandigarh, Dehradun, Delhi,
Faridabad, Ghaziabad, Jaipur, Kanpur,
Ludhiana
West Mumbai Ahmedabad, Indore, Mumbai, Nagpur, Pune
South Chennai Bangalore, Chennai, Kochi, Coimbatore
Andhra Visakhapatnam Hyderabad, Visakhapatnam
Regional Offices and Branch Offices are brought out below:

26
Further, VSP has 4 Consignment Sales Agents in Raipur, Jamshedpur, Pondicherry and
Jammu for selling VSP’s products.

Pollution Control and Environmental Protection

Generally, integrated steel plant is seen as a major contributor to environmental pollution as it

discharges volume of waste products. Elaborate measures have been adapted to combat air
and water pollution in Visakhapatnam Steel Plant. In order to be echo-friendly,
Visakhapatnam Steel Plant has planted more than 3.4 million trees over an area of 35 Sq.
Kms. and incorporated various technologies at a cost of Rs.460 Crores towards pollution
control measures.

Human Resource Management

Human resource initiatives at Visakhapatnam Steel Plant are closely linked to the corporate
strategy of the organization. Visakhapatnam Steel Plant has exemplary industrial relations
where the entire workforce works as a well-knit team for the progress of the company. The
productive environment prevailing in the company fosters an atmosphere of growth-both for
the employees and for the company. Visakhapatnam Steel Plant has introduced multi skilling
concept since inception and the employees are trained as per this concept. Visakhapatnam
Steel Plant has adopted a system of overlapping shifts, the first of its kind, in the industry.
This system ensures smooth changeover of the shifts and uninterrupted pace of operation of
the plant during the shift change over. The labor productivity is 389 tones/man/year for
(2007-08).

Training and Human Resource Development

Training and Human Resource Development are given due emphasis at RINL. Each
year, a minimum of one third of the employees undergo various training sessions either at
Training & Development Centre or at Centre for HRD for sharpening their skills on the
technical and management related issues. Training is also given in the area of safety, fire
prevention, and occupational health besides on the job at the shop floor.

Welfare Measures in VSP

RashtriyaIspat Nigam Limited, Visakhapatnam Steel Plant, considers human resources as the
most important of all the resources in the company. Its development & welfare have therefore

27
been given the utmost emphasis in the overall policy of Human Resources Management of
the company. Pursuant to this policy, VSP has taken several initiatives for introducing &
implementing Statutory as well as Non-Statutory Welfare schemes which together impart and
propagate the feeling that the “Company cares for its employees”.

Besides the Statutory Welfare Measures, the company has been taken up the Non-
Statutory Welfare and Social Security Schemes for the benefit of the employees and their
family members, which are detailed below:

Statutory Welfare Measures Non-Statutory Welfare Measures

Canteen Facilities Facilities For Education

Baby Creche Scholarships
First Aid Facilities Medical Facilities
Water Coolers Housing Facilities
Leave & Maternity Leave Work Dress
Factories Act Vehicle Advances To Employees
Gratuity House Building Advance
Workmen’s Compensation Motivational Schemes
Contract Labor Welfare

Achievements and Awards

The Visakhapatnam Steel Plant Bagged the Prestigious PM’s Trophy for the year
2002-03 for its best performance in the integrated steel sector of the country.
Some of the major awards received by Visakhapatnam Steel Plant are in the area of
energy conservation, environment protection, safety, Quality, Quality Circles, Rajbhasha,
Memorandum of Understanding, sports related awards and a number of awards at the
individual level.

There is something about the sea that touches each one of us. Never silent, changing
with every second, every minute, every hour of the day and night. An eternal flow that
transforms anything that comes in contact with it. It is the same driving force that guides
people at RINL to face the challenges of change.

Visakhapatnam Steel Plant achieved the distinction of bettering some of the global
benchmark thereby becoming an efficient and productive integrated Steel Plant in the
Country.

28
Some of the important awards received by RINL are indicated below:

1. ISO 9002 for SMS and all the downstream units – a unique distinction in the Indian
Steel Industry

2. Indira PriyaDarshiniVriskha Mitra Award: 1992-93

3. Nehru Memorial National Award for Pollution Control: 1992-93 & 1993-94

4. EEPC Export Excellence Award: 1994-95

5. CII (southern region) Energy Conservation Award: 1995-96

6. Golden Peacock (1St prize) “National Quality Award-96” IIM Steel Minister’s Trophy
for “Best Safety Performance – 1996”

7. Selected for “World Quality Commitment Award – 1997” of J*BAN, Spain

8. Gold Star Award for Excellent performance in Productivity

9. Udyog Excellence Gold Medal Award for Excellence in Steel Industry

10. Excellence Award for outstanding performance in Productivity management, Quality

&Innovation

11. Ispat Suraksha Puraskar (First Prize) for longest Accident free period, 1991-94
12. Best Labor Management Award from the Government of Andhra
Pradesh 13.
14. SCOPE Award for best turnaround for 2001

15. Environment Excellence Award from Greentech Foundation for energy conservation in
2002
16. Best Enterprise award from SCOPE, WIPS for 2001-02, besides

17. A number of Awards at the Local, Regional & National level competitions in the area of
Quality Circles & Suggestion Schemes, etc.
18. PM’s Trophy for the year 2002-2003

29
19. CACCI Business Achievement award for environmental conservation and
pollution control by FICCI in 2004
20. CII-GBC National Award for Excellence in Energy Management in 2005

21. Best Industrial Productivity Award (Pandit Jawaharlal Nehru Silver Rolling Trophy) for
Outstanding productivity effort in manufacture of steel products by FAPCCI in 2006

22. Organizational Excellence Award for Efficient Suggestion scheme operation given by
INSSAN in 2006

23. Best Company Work Award by ‘The Economic Times & Great Place to Work
Institute’- in 2009 for inspiring trust among people, instilling pride in them etc

30
 MANPOWER AT GLANCE
AREA Trainee Trainees Non- Jos Executives Total

Khalasis Executives Manpower

Works 0 144 11122 313 3168 14747

IT 0 0 1 0 92 93

Mines 0 0 242 16 92 350

Projects 0 0 48 10 339 397

Others 179 42 766 60 1422 2469

commercial 0 0 156 10 574 740

Finance 0 0 20 1 291 312

personnel 179 42 579 49 499 1348

Corporate 0 0 11 0 58 69

Total 179 186 12179 399 5113 18056

31
 CHAPTER-3
THEORITICAL FRAME WORK OF THE
STUDY

32
 INDUSTRIAL RELATIONS

Industrial Relations is concerned with the relationship between Management

representing the holders of capital and trade unions representing the holders of labor power
regarding the employment, unemployment, terms of employment and unemployment,
conditions of employment and unemployment and conditions of work. Industrial relations is
a developing and dynamic concept and does not limit itself merely to the complex of relations
between the unions and management, but also refers to the general web of relationships
normally obtaining between employees themselves. Both parties to industrial relations have
a common interest in industry, but many a time, they are found to be pulling in different
directions that lead to industrial unrest. Therefore, it has become necessary to secure the
cooperation of both workers and management to achieve good industrial relations.

Besides management and workers, state is another party associated with industrial
relations. The interference of government in industrial relations through legal and
administrative measures is quite common. Thus, the area of industrial relations has been
extended relations among the state, employer and employees.

Definition:
According to Encyclopedia Britannica,
“The subject of industrial relations includes individual relations and joint consultation
between employers and workers at the place of work, collective relations between employers
and their organizations and trade unions and part played by the state in regulating these
relations”.

According to Dale Yoder,

“The term industrial relations refers to the relationship between management and
employees or among employees and their organization that arise out of employment”.

Major Players to Industrial Relations:

Simply stated, industrial relations are the outcome of the employment relations in
industry. The government of a nation influences these relations to a great extent. Thus, there
are three major players in industrial relations.

33
 1. Workers and their Organizations
The personal characteristics of workers, their culture, educational attainments,
qualifications, skills, attitude towards work, etc. play an important role in industrial
relations. Workers’ organizations, known as trade unions are political institutions. They
put pressure on the management for the achievement of these objectives
.

2. Employers and their Organizations

The Employers are a very important variable in industrial relations. They provide
employment to workers and try to regulate their behavior for getting high productivity
from them. Industrial unrest generally arised when the employers’ demand from the
workers and other benefits. These associations put pressure on the trade unions and the
government. They also participate in tripartite bodies constituted by the government to
regulate industrial relations.

3. Government
The Government exerts an important influence on industrial relations through such
measures as providing employment, intervening in working relationships and regulating
wages, bonus and working conditions through various laws relating to labour. The
government keeps an eye on both the trade unions and employers’ organizations to
regulate their activities in the interest of the nation.

INDUSTRIAL RELATIONS IN VISAKHAPATNAM

STEEL PLANT

It has been considered of crucial importance in Visakhapatnam Steel Plant of establishing and
sustaining a productive work culture. Several initiatives have been taken towards it. The
concept of optimum utilization of Human Resources was adopted through Multi-skill and
Multi-pattern of working with emphasis on flexibility in job deployment. Result oriented
environment was broad through tailor made HRD programs, attitudinal change and positive
work ethics.

To carry on with such an Organizational Climate Visakhapatnam Steel Plant has

suitable supportive systems and structures for productive Industrial Relations Machinery.

34
Employee Relations

Usually, in any organization, Industrial Relations climate depends upon the

relationship with workmen and their unions. For this, the initial years are very crucial. An
approach characterized by courage, firmness and total commitment to company’s interest is
essential to build a right relationship over years. Whereas, in Visakhapatnam Steel Plant, the
initial period focused on educating the unions, establishing rapport etc., to attain the
commitment of unions, innovative agreements have been signed that reflects the Company’s
Mission and Objectives. The matters like working hours, holidays, overlapping shifts,
transport subsidy, canteen, production-linked incentives, Visakhapatnam Steel Plant made
long term agreements with the unions. The modern practices of Industrial Relations have
been put to practice, which needs few years more to make their full-fledged presence.
Industrial relations will be different at commissioning stage to that of the Operational level.
For its smooth implementation, sustaining cooperation and collaboration between the
management and unions is much needed.

CENTRAL EMPLOYEE RELATIONS SECTION-ROLE

Central Employee Relations Section was earlier called as Industrial Relation Section.
It is a wing of Personnel Department

Central Employee Relations Section acts as a bridge between the management and the Trade
unions / employees. It plays major role for maintaining Industrial Democracy.

Personnel Executives function as Industrial Relations Manager. They are placed in

each zone also in order to facilitate close relations with the employees. They, in turn, provide
the information to the Plant Head and facilitate the process of Industrial Relations at Central
Employee Relations.

The functions of Central Employee Relations are to gather the information regarding
the activities of Trade Unions and Employee Associations, predict the possible outcomes and
to take preventive measures to sustain Industrial Peace and Democracy and to ensure
uninterrupted production.

The main task of this section is to settle industrial disputes amicably within less time.
Signing of Memorandum Settlements, Coordination with the unions, liaison with State &
Central Labor Departments and Police and CISF.

The information collected from the Zones will be thoroughly analyzed and will be
used for case studies and forecasting, as and when required. It is the responsibility of the

35
Central Employee Relations to organize meetings with unions and other agencies on the
issues connected with Industrial relations. In this way Central Employee Relations
contributes much in the matters of industrial relation.

Areas focused
 Sensitive to Employees Grievance
 Expeditious Redressal of Grievances
 Reduction of Time Cycle
 Zero-grievance
 Inculcation of Union Cooperation and Collaboration
 Creating awareness among Unions towards the Organizational goals
 Confidence building measure

Central Employee Relations also helps in conducting Union Elections i.e., for every two
years in Visakhapatnam Steel Plant.

SALIENT FEATURES OF INDUSTRIAL RELATIONS IN VSP

1. Labor Productivity of Visakhapatnam Steel Plant is highest in integrated steel plants

in India.

2. Presently, 21 Registered Trade Unions are functioning at VSP. Out of these, 3 unions
viz., Visakha Steel Employees Congress (INTUC), Steel Plant Employees Union
(CITU) and Visakha Steel Workers Union (AITUC), have the support of more than
90% of the total electorate. There are 05 unions operating for espousing the cause of
contract labour. In addition, three unions each are also separately registered at
Captive Mines located at Jaggayyapeta and Madharam. By and large, a smooth and
cordial IR climate prevails at VSP.

3. The “Man days Loss” due to IR events, which were brought down considerably and
put at `Zero’ level indicating the peaceful and harmonious industrial relations scenario
in Visakhapatnam Steel Plant.

4. The Code of Discipline adopted in the state of Andhra Pradesh has envisaged
determination of Majority union by way of secret ballot elections at an interval of
every 2 years. So far 10 Union Elections were held at VSP since November `85. In
the 10th Trade Union Elections held on 3 rd March 2008, the Visakha Steel Workers
Union (VSWU) has emerged as the majority union by securing 6597 (58.94%) votes

36
 out of 11,193 eligible votes, the details of which are placed at Annexure-VI. The
union was conferred the status of recognition for a period of 2 years with effect from
15.04.2008.

5. A number of Memorandum of Understandings (MOU), Memorandum of Settlement

(MOS) was arrived at by duly following proper collective bargaining process. A list
of major MOU/MOS arrived since inception, are placed herewith. These notable
features are getting union(s) commitment for realization of Mission & Objectives,
Management Charter of Demands, Safety & environment matters, Increase of
Production & Productivity, Discipline etc.

6. We were following the practice of resolving any issue with the Recognized Union
through mutual discussions in a cordial atmosphere. However, this resulted in intense
inter-union rivalries and implementation of issues settled with Recognized Union was
found to be difficult for both the Unions and Management. To overcome such a
situation, an institutional frame work has been evolved for Joint Consultation with
representatives of 3 major unions and the representatives of the Management
providing scope for consultations in all major areas like, production, productivity,
quality, safety etc., vide Memorandum of Settlement dated 12.6.96. The Settlement is
still being pursued in true letter and spirit.

7. A number of participative fora are functioning at VSP, which have diminished inter-
union rivalries and ushered to a peaceful IR climate. More than 15% of the
employees have been given opportunity of participation in various fora at VSP
including Quality Circles and Suggestion Schemes.
8. Unique informal and formal Grievance Redress Systems have been successfully
implemented in the organization providing for an active employee
participation/involvement.

9. VSP bagged “Best Management Award” for the year 2000-2001 from the State
Government of Andhra Pradesh for outstanding contribution in maintenance of
Industrial Relations, Labor Welfare and Productivity.

37
 DISCIPLINARY PROCEDURE
Discipline is a Code of Conduct in an Enterprise in which the members of the enterprise
conduct themselves within the standards of acceptable behavior which means that the
stipulations of the code of conduct laid down by the enterprise are properly understood and
observed by one and all.

The state of Industrial Relations in a country/factory is also reflected in the discipline

and the morale of the labor force. Discipline is very essential for a healthy industrial
atmosphere and the achievement of organizational goals.

In any Organization maintenance of discipline among personnel at all levels is required

to create the conducive work environment so as to facilitate increased productivity and
organizational effectiveness. So management of an organization can adopt two approaches
for discipline maintenance:

1 Adopting preventive measures ‘prevention is better than cure’ principle is based

on the assumption that employees perform better through rewards than
punishments. So the problems of indiscipline do not emerge.
2 Curative measures that it taking “disciplinary actions” against the persons
involved in indiscipline.
The Disciplinary Action should be taken after going through specific process because the
punishment may be held invalid if there is any deviation from the procedure laid down. The
procedure for taking disciplinary action is defined by the Standing Orders formulated by the
Organization.

While taking an action, all the relevant facts leading to indiscipline must be ascertained
so that the need for disciplinary action is determined. The facts must be collected as soon as
possible to take the action promptly.

The disciplinary procedure either Punitive or Curative has to be invoked for preserving
industrial peace as well as maintaining the efficiency of the organization.

38
Disciplinary Procedure at Visakhapatnam Steel Plant:
When an act of misconduct is alleged against a workman for whom a punishment as provided
under Standing Orders of the Company. The workman shall be given an opportunity to show
cause before punishment is imposed.

Disciplinary Authority:

Any Executive/Officer to whom powers are delegated to take disciplinary action against a
workman shall be the disciplinary authority competent to initiate disciplinary action and to
impose punishment on a workman. The Disciplinary Authority shall frame definite charges
on the basis of the allegations against him. The charges together with a statement of
allegations on which they are based, shall be communicated in writing to the workman who
shall be required to submit a written statement of his defense within such time as may be
specified but not exceeding 3 days by the Disciplinary Authority. If it is necessary the
Disciplinary Authority shall hold an enquiry and take the necessary action.

Appellate Authority:
The workman shall have the right of appeal to Appellate Authority. The appeal shall
be submitted within 15 days of receipt of the order of the Disciplinary Authority, and
theAppellate authority shall dispose of the appeal within 30 days of the receipt of the appeal.
The appellate authority is the next higher authority to disciplinary authority.

INDUSTRIAL DISPUTES

Dispute, in general sense, is the expression of differences over some issues of interest
between two or more parties. Industrial disputes like problems of indiscipline and their
effective management are on the major issues in maintaining good Industrial Relations in the
Country / Organization.

Definition:

According to Industrial Disputes Act, 1947“Industrial Disputes means any dispute or

difference between employers and employers or between employers and workers or between
workmen and workmen, which is connected with the employment or non-employment or the
terms of employment or with the conditions of labor of any person”.

39
An individual dispute between an employer and one of his workmen is by itself not an
industrial dispute, which can be referred to under section 10 of the Act. But such a dispute
may become an Industrial dispute provided a majority of workmen or union of workmen
takes up the cause of particular workman, in the particular industrial establishment.

The causes of industrial disputes are many and varied and sometimes even trivial. In India,
various causes of Industrial disputes may be grouped into four categories: economic factors,
management practices, trade union practices and legal and political factors.

Machinery for Handling Industrial Disputes

In managing industrial disputes, management can take certain actions. These actions may be
grouped into two categories:

Prevention of industrial disputes:

The preventive machinery has been set up with a view to creating harmonious relations
between labor and management so that disputes do not arise. It comprises of the following
measures.
(a) Worker’s Participation in Management
(b) Collective Bargaining
(c) Grievance Procedure
(d) Tripartite bodies Code of Discipline
(e) Standing Orders

Settlement of Industrial Disputes:

If preventive machinery fails, then the industrial dispute settlement machinery should be
activated by the Government under Industrial Dispute Act, 1947, because no-settlement of
disputes will prove to be very costly to the workers, management and the society as a whole.
This machinery consists of
(a) Conciliation
(b) Court of Enquiry
(c) Voluntary Arbitration
(d) Adjudication (Compulsory Arbitration)

40
 Major Industrial Relations Events in Visakhapatnam Steel Plant

During Construction phase, displaced persons quite often organized Strikes and
RasthaRoko agitations demanding Employment in Visakhapatnam Steel Plant. During 1985-
86, approximately 9,515 man-days were lost in Construction activity because of the above
agitations.
Similarly in 1986-87, in the wake of death of an employee in the Health Centre,
employees resorted to sudden work stoppage demanding extension of adequate Medical
Facilities.
In the Operation phase, in the year 1991-92 following the death of 2 employees in an
Accident occurred in Sinter Plant, there was an illegal work stoppage at Sinter Plant from
24.8.1991 which culminated into a plant wide strike from 3.9.1991 to 6.9.1991 demanding
immediate policy for provision of immediate employment to the dependent of the deceased
employee on compassionate grounds.
During the year 1993-94 (16th – 22nd October) a week Plant wide Strike took place on
account of a conflict between CISF personnel and VSP employees on the issue of an entry
through the main gate. Subsequently, a gate monitoring system was introduced with the
officers in both line departments as well as staff departments to monitor that such incidents
do not recur.
As a preventive measure to arrest industrial relations problems a great amount of
persistence and preservence has been professed by the management in inculcating a sense of
positive discipline in the employees. It was also impress upon them through various HRD
Programs that the employees may act with restraint in all the matters and to adopt only
peaceful methods of representation. The employees have also come through the stages of
Construction, Commissioning and Operation and have been made to understand that the
pressure tactics, arm-twisting methods of work stoppages and stoppages of production units
would result only in deterioration of industrial relations and in no way help bring them any
solace.

EMERGING TRENDS:

1 As a consequence of all these happenings, a few issues are coming into sharp
focus in the Indian economic scene. Gradually, as India gets integrated into the
world market, there is cut-throat competition in the industrial sector.

2 Competition is inducing innovation and companies are evolving newer strategies

to survive the onslaught on their market share by new and more efficient

41
 enterprises, improving the quality of their goods and services and yet trying to
remain cost efficient.

3 Faced with keen competition, one sector of economy is also, at times evolving
short-term strategies with utter disregard to the interest of other sector(s).

4 The customers are becoming supreme, seeking greater and greater value in the
goods and services they buy.

COLLECTIVE BARGAINING SYSTEMS

Collective Bargaining is a technique adopted by the organization of workers and

employers collectively to resolve their differences with or without the assistance of a third
party. Its ultimate aim is to reach some settlement acceptable to both the parties involved in
labor-management relations. This concept was coined by Sydney and Beatrice Webb.
Great Britain is said to be the ‘Home of Collective Bargaining’.

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. This concept implies “Collective negotiation of a contract between the
managements’ representatives on one side and those of the workers as the other. It may
be defined as a process of negotiation between the employers and the organized workers
represented by their union in order to determine the terms and conditions of employment.

International Labor Conference also defined as ‘Collective Bargaining’ extends to all

negotiations which take place between an employer, a group of employers or one or more
employers’ organizations on the one hand and one or more workers’ organizations on the
other for determining working conditions and terms of employment and/or regulating
relations between employers and workers and/or regularizing relations between employers of
their organizations and a workers organization.

As per Harbison, collective bargaining is a process of accommodation between two

institutions, which have common and conflicting interests. It is the resolution of industrial
problems between the representatives of employers and the freely designated representatives
of employees acting collectively with a minimum of Government dictation.

It is a process in which the representatives of a labor organization and representatives

of the business organization meet and attempt to negotiate a contract or agreement which
specifies the nature of employer-employee union relationship.

42
 The technique of CB has been adopted by unions and management for resolving their
conflicting interests. It plays a significant role in improving the labor management
relations and in ensuring industrial harmony. It helps a lot in better understanding of each
other’s point of view as well as problems. Through discussion and interaction, both the
parties learn more about others and often misunderstandings may be removed. It helps in
easing out many minor differences and there are many instances in which even major
disputes are said to be settled without any work stoppage or outside intervention.
Accordingly, its role in conflict resolution is very significant.

Collective bargaining brings the employees and managers closer; develops better
understanding helps industrial peace; resolves conflicts and differences; brings social change.
It helps effective functioning of the enterprise and promotes industrial harmony. It helps
effective functioning of the enterprise and promotes industrial harmony. It is a two-way
process and mutual give and take aspect rather than take it or leave it method of arriving at
the settlement of disputes. The essence of collective bargaining is the agreement for
dispute settlement and smooth functioning of the enterprise. The agreements bring both
labour and management together to determine the conditions of employment and create new
environment for problem solving. It provides a flexible means of adjusting wages and
conditions of employment to economic and technological changes.

Scope of collective bargaining

The Encyclopedia Britannica defines collective bargaining as follows:

“In its widest sense collective bargaining is a negotiation between the employer or
group of employers and a group of work-people to reach an agreement on working
conditions. If negotiations are between an employer and a group of his own work people the
dependence of the work people on the employer for their jobs weakens their bargaining
powers, and therefore, collective bargaining is more usually understood to be negotiations
between one or more trade unions and an employer or group of associations or employers”.

It is a process of self-settlement by which management and organized labour may

discuss each other’s problems and exchange each other’s view points negotiate and reach a
common understanding to develop a setting for a better employment and working conditions
to the mutual benefit of workers and management in a spirit of cooperation and goodwill for
keeping peaceful industrial relations.

Collective bargaining performs a legislative function. The agreement under collective

bargaining as concluded between the parties performs a judicial function when it helps the
parties in the interpretation sought in case of a particular clause and also furnishes meanings,
explanation and application which a particular clause conveys.

43
Some of the salient features of collective bargaining are:

1. It is a ‘group’ process; wherein one group representing the employers and the other
representing employee sit together to negotiate terms of employment.

2. It is a process in the sense that it consists of a number of steps. The starting point is
the presentation of the charter of demands and the last stage is the reaching of an
agreement, or a contract which would serve as the basic law governing labor-
management relations over a period of time in an enterprise
.
3. Negotiations form an important aspectof the process of collective bargaining, i.e.,
there is considerable scope for discussion, compromise or mutual give and take in the
collective bargaining deliberations rather than confrontation.

4. It is a bipartite process. The employers and the employees are the only parties
involved in the bargaining process. There is no third party intervention. The
conditions of employment are regulated by those directly concerned.

The purpose of collective bargaining is that it brings parties close and develops better
understanding for industrial peace, democracy resolves conflicts and differences; guarantees
the rights and responsibilities of the workers; develops self-respect and fosters responsibility
on both workers and employers; brings social change through acceptable solutions; and
formulates the terms and conditions under which labor and management will have to work
together. The primary objective is to ensure effective functioning of the individual enterprise
and more importantly the entire economy.

Main functions of Collective Bargaining:

The main functions of Collective Bargaining are:

(a) Concentration on wage determination-fixing the prices of labor services;
(b) Establishment of a system of workers’ rights in industry – this may be termed as
democratization of industrial relations system or industrial jurisprudence;
(c) Establishment of machinery for the representation of employees in decisions
affecting their industrial and group interests.

44
 DETAILS OF MAN DAYS LOST DUE TO INDUSTRIAL
RELATIONS EVENTS

SI.No. PERIOD LOSS

OF CAUSE
MAN
DAYS

01. 1990-91 12,600 Sudden strike in the wake of accidental Deaths one at Traffic
Department and Another at Sinter Plant

02. 1991-92 56,135 Illegal work stoppage at Sinter Plant from 24.8.91 & Plant wide
strike (3.9.91- 6.9.91), death of two employees in an accident

03. 1992-93 304 Work stoppage at Steel melting Shop following an accident

04. 1993-94 87,795 Plant-wide strike from 16.10.93 to 22.10.93 on account of a

conflict between CISF personnel and VSP employees on the issue
of entry through main gate

05. 1994-95 NIL Go-slow at COCCP

06. 1995-96 2,342 Issue of job rotation at COCCP, provision of adequate Safety
measures, go-slow at CRMP, CPCCP and one day Nation-wide
strike on 23.2.96 by CITU

07. 1996-97 325 Work stoppages resenting on unsafe work practices, demanding
for provision of adequate safety measures issues of job rotation
and revision of incentive/reward schemes

45
 Work stoppages on account of accidental deaths at Sinter Plant
08. 1997-98 315 and SMS on 24.4.97 and 10.10.97 respectively, and one hour
Tool Down strike in each Shift on 15.10.97 on Bonus issue

Technicians posted in Wagon Tippler Mechanical Section of

RMHP did not attend to shutdown duties connected to Coal
09. 1998-99 78 Tippler Section. Employees of RED working in SMS area did not
attend to ramming work on Converter demanding Incentive on
par with the employees of SMS.

Non-executive employees participated in one day token strike on

2.2.2000 in response to the call given by CPSTU affiliated
10. 1999-00 13,447 unions. Technicians posted in Wagon Tippler Mechanical Section
of RMHP did not attend to shutdown duties connected to Coal
Tippler Section demanding settlement of the roster system.

11. 2000-01 10,851 Unions organized one day token strike on 11.5.2000 opposing
dis-investment policy of the Central Government

In response to the call given by the Unions, Non-executive

employees observed 2 hours strike in each shift on 16.4.2001 and
12. 2001-02 2,823 one day token strike on 17.4.2001 as a protest against the non-
settlement of Wage Revision at NJCS Level

13. 2002-03 3,163 One day nation-wide strike on 16.4.02 by all trade unions except
INTUC opposing disinvestments policy of the Govt.

46
 14. 2003-04 NIL

15. 2004-05 NIL

16. 2005-06 NIL

17. 2006-07 NIL

18. 2007-08 NIL

WORKERS PARTICIPATION IN MANAGEMENT

Workers Participation, also known as Labor participation or Employee participation,

in management is a concept shrouded with so much vagueness that for different people, it has
different meanings. The basic reason for this perceptual difference is due to different pattern
of practices and programs adopted by various Countries for implementing workers
participation in management. Many Industrial Relations experts regard it as an essential step
involving redistribution of power between management and workers in the direction of
industrial democracy though there are differences of views over the content and level of
participation. The principal forms through which workers participate are Information
sharing, Joint consultation and Suggestion schemes.

The various forms of workers participation in management have assumed great

importance these days because it serves the following purposes

1 Reduced industrial unrest

2 Maintaining good Industrial Relations
3 Higher productivity
Workers participation in management falls into several categories. These are informative,
consultative, associative, administrative and decisive participation.

47
48
Informative: In informative participation, there is sharing of information – for instance,
the information regarding production figures, the balance-sheet of the company and economic
conditions etc.

Consultative: In consultative participation workers’ representatives are consulted on

matters relating to welfare facilities by the management. Here, the workers’ representative
action an advisory capacity and the final decision rests with management.

Associative: In associate participation the management accepts the suggestions of the

council for solving a problem on hand. The management is obliged to accept and implement
if the committees take unanimous decisions regarding a problem.

Administrative:In administrative participation, the decision is already taken and the

councils (joint bodies) have the right to choose the method of implementing it. This may
include administration of welfare measures, operation of vocational training and apprentice
schemes and preparation of work schedules. This involves higher degree of delegation of
authority and responsibility to the lower rank and file of the organization.

Decisive participation:Finally there is decisive participation, the highest form of

participation where all matters, economic financial and administrative are brought under the
scrutiny of the councils and the decisions are taken jointly.

OBJECTS OF WORKERS PARTICIPATION IN

MANAGEMENT

The objective pursued by the various systems of workers’ participation in

management varies from country to country, from region to region and even from
organization. The workers or the trade unions may regard participation as a means to increase
their wages, while the others may regard it as a means to increase production, which

49
 may not necessarily result in greater security for workers. All these objectives include in
particular (ILO, 1969):

i. Moral, ethical or ideological considerations which are linked with the

growing awareness of (a) the basis equality of men which beyond the political sphere,
should extend also to that of economic pursuit and production effort, and (b) the
importance of the undertaking for the socio-cultural life of the workers in general,
and, more particularly, their need to be recognized and associated as a community in
decisions which may affect their conditions of work and living within and without the
undertaking.

ii. Socio-political objectives, aimed mainly at applying the principles of democratic

self-government within the economy; this generally claims for what has often been
defined as “industrial democracy” being particularly stressed either where the need is
felt thus to develop or to strengthen democratic institutions in the political sphere by
making them rest on the undertaking self-government, or, in the undertakings
belonging to the public sector of the economy or under the national development
programmes, also, to supplement or to replace private entrepreneurial motivation
through the association of workers in management and in the results of the
undertakings. However, the social aim in management and in the results of the
undertakings. However, the social aim of some of the participation schemes is merely
to achieve a closer integration of the workers within the undertakings while not
interfering with the latter’s basic structures;
iii. The general economic objectives based on the assumption that whenever people
are allowed to participate in the preparation of measures and policies which they are
called upon to implement, such participation may prove apt, particularly where linked
with economic advantage, to reduce conflict and to enhance the cooperative spirit of all
concerned.

50
SPECIAL FEATURES LEADING TO THE SUCCESS
OF PARTICIPATION

One reason for the successful functioning of the joint consultation is the clear demarcation of
issues to be discussed by various forums, which is strictly, adhered to. Another important
reason for the continued success is that both management and union treat it as a dynamic
system. From time to time, new subjects are added to the list and financial powers of JDCs
are increased. The list of subjects which the highest council – the JCM – discusses is
impressive. It includes not only performance in relation to production, cost and manpower,
but also sales, finance and industrial relations. It is indeed a rare sight in India to see a
meeting attended by an equal number of top management and union officials which is chaired
by the union president. Again, despite the pressures on his time the Managing Director makes
it a point to attend DC meetings. Other reasons of success are peaceful industrial relation
climate, good upward communication system, and progressive personnel policy of the
organization.

SOME SUGGESTIONS FOR PROMOTING WORKERS

PARTICIPATION IN MANAGEMENT
Some important points which may be considered by the Government, management and
trade unions for making participative management a success and reality.

(1) INDUSTRIAL RELATIONS: The quest for industrial peace has been the
central preoccupation of employers, workers and government for a long time. The
Five Year Plans, Labor legislations, the Industrial policy, have all endeavored to
emphasize industrial peace as the necessary pre-requisite for industrial growth and
development, but it has remained elusive. Here an attempt has been made to indicate
briefly some important measures which are considered necessary for bringing about a
conducive industrial relations climate which is one of the basic pre-requisites for the
success of participative management. The essential features are: -

51
(A) It is a fact that in the absence of an arrangement for statutory recognition
of unions, or voluntary recognition by employers on moral grounds, collective
agreements have not made much headway.

(B) Consequently, there is a greater scope for more reliance on collective

bargaining thereby replacing avoidable adjudication or more of governmental
interference.

(C) To create appropriate climate for collective bargaining, it becomes necessary

to resort to statutory recognition of a sole bargaining agent, where voluntary
efforts fail.

(D) Recognition of trade union should be made compulsory under

a central law:

(i) For all undertakings employing more than 1000 workers;

(E) Provided the trade union seeking recognition has at least 45% membership
among workers at present, but attempts should be made to have a higher
percentage of around 55 to 60.

(F) There should be a properly recognized authority under a central legislation to

decide disputes through verification of records, where the difference in the
verified membership is 10% or less than a secret ballot open to all the
employees should be taken.

(G) The recognized union should be statutorily given:

(i) Exclusive right of sole representation;

(ii) Exclusive right to enter into collective bargaining;
(iii) Exclusive right to collect membership subscription within the factory
premises;
(iv) Right to nominate representatives on different joint committees.

52
 (H) The minority union should only be allowed the right to represent individual
cases of dismissal and discharge before a labor court.

(I) TRAINING FOR PARTICIPATION: All employees (both

management and workers) should be briefed on the reason for the introduction
of participation and its likely impact; they should receive clear documentation
and have the facility of questions being answered. Training for those
management and workers’ representatives who are going to be directly
involved in participative forums should cover three main points:

(i) Basic knowledge of the philosophy, operation and intent of participation within
the company. This approach should be intended to promote joint working based on
problem resolution rather than negotiating ‘conflict’. Team development techniques
in a workshop situation may be used for this purpose.

(ii) Special skills training to enable them to discuss and contribute to the decisions in
which they are to be involved

(iii) Contextual training – participation puts strains on and questions the company’s
traditional approach to management. Opportunities therefore have to be provided for
management teams to consider the impact that participation will have on them.

WORKERS PARTICIPATION IN VISAKHAPATNAM STEEL

PLANT
Management of Visakhapatnam Steel Plant also facilitates Workers Participation,
which secures a right for the recognized union in representing their views and opinions
regarding production, safety, canteen and township development etc., through the formation
of different Committees at Shop floor and Plant level. But these committees constitute the
representatives of recognized union, leaving behind the opinions of the other unions that
constitute to around 60% of employees.

53
 This lead to the inter-union rivalry as the non-recognized unions were set aside
without being consulted regarding the policy matters, creating difficulties in implementation
of issues that was settled through negotiations.

EMERGENCE OF JCM
To overcome this limitation an alternative method called “Joint Consultative
Machinery” was introduced. Joint Consultative Machinery constitutes representatives of all
the unions, which got more than 15% of the total votes polled during the union elections.
Their number will be equal to the management representatives being nominated by the
organization. This facilitated the non-recognized unions too in presenting their opinions.
The total numbers of union representatives are equally divided among the unions having
more than 15% of the polled votes.

Joint Consultative Machinery extends its scope in the areas like production,
productivity, quality, safety, corporate affairs, work related issues, incentives, deployment/re-
deployment, job rotation etc., According to the terms of settlements departmental safety
committees with an apex plant level safety committee were being constituted to look after all
issues relating to safety. And each department of the organization constitutes Joint
Consultative Machinery to discuss production, welfare and so on covering all the matters of
employees and management. In addition, a company levels Corporate Business Information
Forum (CIBF) to discuss functional aspects of Visakhapatnam Steel Plant with the
participation of top management and senior representative of major unions.

Facilitating all the major unions in Joint Consultative Machinery helped a lot in
diminishing the Inter-union rivalry and led to the establishment of peaceful Industrial
Relations climate.

But, Joint Consultative Machinery works only when the recognized union co-operates
with other union. CITU, when in chair, accepted to share it but, AITUC didn’t so, as a result
of it, Joint Consultative Machinery came to standstill. This non-performance of Joint
Consultative Machinery led to the establishment of Participative Fora in a different from.

54
 The various Participative Committees formed by the management along with the
statutory committees constitute representatives from management as well as from recognized
union, in equal numbers. These representatives carry on the functions of these Committees
that include provident fund trust, sports council, town development committee, community
welfare center etc.

GRIEVANCE MANAGEMENT
Grievance is a state of dissatisfaction over some issues related to employment.
Generally, expression of this dissatisfaction in oral form is known as complaint while in
written form it is known as grievance. In the organizational settings, employees may have
some grievances against employers, in the same way , employers may have grievances
against employees.

Grievance Management is very essential to maintain good Industrial Relations, which

increases productivity and effectiveness of an organization. Grievance should be redressed
by adopting proactive approach rather than waiting for the grievance to be brought to the
notice of management. In many cases, even the proactive approach of management for
removing the causes of grievances may leave some scope for the emergence of grievances.
For handling such grievances, a Grievance Handling Machinery, known, as Grievance
Procedure is required.

The Grievance Procedure is problem solving, dispute-settling machinery which has

been set up following an agreement to that effect between labor and management. It is the
means by which a trade union or an employee makes and processes his claim that there has
been a violation of the labor agreement by the company.

Grievance Procedure is a device through which grievances are settled, generally to the
satisfaction of employees/trade union and management.

55
Grievance Redressal Procedure at VSP
The objective of Grievance Redressal is to provide easily accessible machinery for
settlement of grievances of executives and to adopt measures as would ensure expeditious
settlement of grievances leading to increased satisfaction on the job and resulting in improved
productivity and efficiency of the organisation. In Visakhapatnam Steel Plant the Grievance
Procedure consists of 3 stages, they are –

Stage-I

An aggrieved employee shall send his grievance to his Head of the Department within
a period of 3 months of its occurrence. The Head of the Department will give a personal
hearing and try to resolve the grievance at his level and intimate his decision to the aggrieved
employee in writing within a week.

Stage-II

If the aggrieved employee is not satisfied with the reply of Stage-I authority or has not
got a reply within the stipulated time, he may submit his grievance to the Divisional Head.
The Divisional Head concerned shall go through the Grievance and settle the same at his
level. The decision taken shall be communicated in writing to the aggrieved employee within
15 days of receipt of the grievance.

Stage-III
If the aggrieved employee is not satisfied with the reply of Stage-II or has not got
reply within the stipulated time, he may address his grievance to the Grievance Council. The
Grievance Council shall examine the Grievance in detail and give their recommendations
before the end of the month following the month in which the grievance council receives the
representation.

The aggrieved shall have the right to represent his grievance before Chairman-cum-
Director direct if his grievance is not settled to his satisfaction at Stage-III or within the time
limits as prescribed under the Company’s Grievance Redressal Procedure.

56
Participation in Grievances Management at VSP:
Today’s Grievance is tomorrow’s IR problem. VSP has carved out a unique
way of dealing the grievances. With a view to provide immediate redressal of
grievance with participation of workmen representative/Union representative. The
Grievance Redressal procedure at a glance is given in the figure below.

Review by
Plant grievance redressal Director(personnel) Non-plant grievance
machinery redressal machinery

Executive Director(works) GM(personnel)

CENGREF CENGREF

m II
Form
For I Form II
1. Registration & segregation
HOD HOD
2. Redressal
AGREF AGREF
Form I
Registration & segregation
Redressal
SJPC SLSC SJPC SLSC

Registration of grievance with Registration of grievance with

controlling officer controlling officer

FeedbackGrievance Grievance Feedback

Abbrevations
CENGREF - Central grievance redressal forum AGREF- Area
grievance redressal forum SLSC- Shop level safety committee
SJPC- Shop level joint production committee

The Machinery forGrievance Redressal

Grievance Redressal Machinery Level, Plant Level and
at Departmental
Company Level shall consists of

Area Grievance Redressal Forum (AGREF)

All Major Departments will have AGREF and the Small Departments will be clubbed
into groups with each group having one AGREF

57
The Forum consists of

Head of the Department --- Chairman

Zonal Personnel In charge --- Convener

Representative of Finance Department --- Member

Representative of Marketing Systems Department --- Member

One Representative of from each major Union --- Member

Central Grievance Redressal Forum (CENGREF)

It consists of

Works Division:
Executive Director (works) --- Chairman

Plant Personnel In charge --- Convener

General Manager (Industrial Relations) --- Member

Joint General Manager (Finance) --- Member

One Representative from each union --- Member

Non-Works Department:

General Manager (Personnel) --- Chairman

Manager (Personnel) --- Convener

General Manager (Marketing Systems) --- Member

Chief (Production) --- Member

Joint General Manager (Finance) --- Member

One Representative from each Union --- Member

58
The following matter comes under the grievance redressal. They are
1 Payment of Wages and Incentives
2 Increments
3 Deduction/Recovery of dues
4 Allowances and Advances
5 Seniority and Promotion
6 Attendance and Leave
7 Workmen’s Compensation
8 Working conditions at place of work
9 Transfer etc.,

JOB ROTATION IN VSP:

The job rotation system was introduced in VSP in the year 1995. Demand for job rotation for
employees working in hard areas was raised by the workmen/unions in Battery of Coal &
Coal Chemical Division, Continuous Casting Department of Steel Melt Shop and Cast
Houses of Blast Furnace for the following reasons:

1. Absence of any special benefit for working in hard areas.

2. Perceptions that having common designations entitled the employees to work in other
areas of the department especially when channel of promotion is common. Driven by
persistent pressure, job rotation plans were effected in operation areas like Cast House
of Blast Furnace, in Continuous Casting Dept. of Steel Melt shop and Battery of Coal
& Coal Chemical Department during June 1995 to August 1995 involving
Technicians and Khalasis based on discussion with the unions. Similarly Job Rotation
plans have been formulated in Light Medium & Merchant Mills & Wire Rod Mill for
Technicians in the Operations Area in July 1997 and January 1998. The concept
received a wider acceptance among the workers/non-executives working in major
production units like Coke Ovens, Blast Furnace and Steel Melt Shop etc. In order to
avoid the skill dilution of the young work force and to make them get trained on all
the areas/sections in a department the concept was introduced for skill

59
 expansion of the working hands. Later the concept was well received by the Service
Zones also such as Telecommunication, Instrumentation, Maintenance areas.

BENEFICIAL EFFECTS:
Skill Expansion:
The skill of working hands get expanded by working and get experienced by working in all
the section in a department unlike working in a single section and retiring. For instance, the
technicians posted to Batteries from other sections in Coal & Coal chemical Department they
bound to know the concept of Heat & Regulation which is a prime concept to operate coke
oven batteries. Over a period of time, all technicians in the department becoming self-
sufficient to work on any given area.

Health preservation of Employees

Because of rotation, employees are to work for only 3 years at a stretch in
Battery. This has resulted in preservation of their health and better productivity at the work
spot.

Reduction of IR problem potential:

Since the employees are rotated from one section to another, their potential to form a “Strong
Arm Group” gets reduced. Therefore the chance of any sustained and intense problem on the
IR front is also reduced.

Increased Job Satisfaction of Employees:

Since the employees are trained and get experienced in more than one section, the sense of
responsibility and understanding the integrated functional relationship among all the sections
increases, which leads to more job satisfaction of the employees.

60
 JOB ROTATION SCHEME FOR STEEL MELT SHOP
TECHNICNAN (OPERATIONS)

1 45 Technicians (O) CCD (o) are being rotated to other areas.

2 45 Technicians (O) from the following areas are being rotated to CCD (O):
Slag Yard 4, BMS 4, Converter 8, LP Bay 6, TP Bay 7, Misc. (DF, CCD G) 2, BSY
6, PGT 2.

I. Rotation is done every six months i.e., 1st Wednesday of April and October.

II. Total No. of Tech (O) rotated in 1st cycle of Job Rotation.

ROTATION PLAN FOR KHALASIS (OPERATIONS)

1 Rotation is done once in a year.

2 9 Khalasis from CCD (O) area are being rotated to other areas.

3 9 Khalasis from TP Bay 4, OCM 1, BSY 2, Stores 1 and CCD (O) were rotated
to CCD (O).

PRODUCTION INCENTIVE SCHEME IN VSP

Given the enormous capital cost of our plant, it is absolutely essential to operate it in a
safe and efficient manner achieve 100% capacity utilization and a productivity level of not
less than 230 t/man/year and consistently turn out high quality products matching the market
requirement.

To induce us to translate the plans into real actions at the shop floor, several
organizational and motivational measures have been taken. The latest motivational package

61
comprises Performance Based Incentive Scheme and Commitment Linked Motivational
Scheme. Underlying this incentive package is VSP’s commitment, concern and care for us.
For, we have taken upon ourselves to give out our best to this organization.

Introduction of a unique motivational package

Better performance more earnings: Better performance and better results in the
areas of Capacity utilization, Productivity, Quality, Costs, Safety and such other crucial
aspects are a must for VSP. The success of VSP would depend on its employees rendering
dedicated work with high levels of motivation. To motivate employees and provide incentive
to hard and efficient work a unique Motivational Package has been introduced in VSP, which
has several important features in the Indian Steel Industry. The introduction of the package is
major milestone in the organizational endeavor to establish a productive work ethos in VSP

INDUSTRIAL RELATIONS AND ITS IMPACT ON

PRODUCTION AND PRODUCTIVITY

Industrial relations do not emerge in Vacuum they are born out of “employment relationship”
in an industrial setting. It is the Industry which provides the environment for industrial
relations. The Production and Productivity of an Organization depends upon the type of
Industrial Relations or the events that take place in an organization which are harmful to
industrial relations.

In Visakhapatnam Steel Plant the Total Man days lost was 1, 87,015 due to various
Industrial Relations events that took place in the last ten years.

47% of the total man days were lost i.e., 87,795 lost due to Plant-wide Strike from
16.10.93 to 22.10.93 on account of a conflict between Central Industrial Security Force
Personnel and Visakhapatnam Steel Plant Employees on the issue of entry through Main
Gate. Subsequently gate-monitoring system was introduced with the Officers in both Line

62
Departments as well as Staff Departments to monitor and see that such events do not re-
occur.

37% of the total man days were lost i.e., 69,195 lost due to accidents that took place in
different departments in the last ten years.

16% of the total man days were lost i.e., 29,922 lost in the last ten years due to the
following incidents.

1 Demanding adequate Safety measures at working places

2 Demanding revision of Incentive/reward schemes
3 Opposing Dis-investment policy of the Central Government

But the Impact of Industrial Relations events on Production were not so severe in the
last ten years. The Production details of the company show that the production was
increasing continuously in the last ten years. If the events did not take place may be the
production would have further increased.

When it comes to Productivity, the impact of Industrial Relations events on Productivity was
not so severe. The Productivity details of the company show that the productivity was
increasing continuously in the last ten years. If the events did not take place may be the
productivity would have further increased.

Visakhapatnam Steel plant being one of the Integrated Steel Plants in the Country. The loss
of production in one department will affect the other department and the cost of loss of
production is also depends upon the type of manufacturing department. If it is a major
production unit the loss is very severe if it is a service unit the loss is less.

The Production and Productivity of an Organization is good when there is good Industrial
Relations. The Industrial Relations would be good when the management provides safety
measures, incentives, good internal communication and good welfare activities to the
employees. At the same time the Trade Unions should also function effectively to improve
the Industrial Relations.

63
 CHAPTER-4
DATA ANALYSIS
AND
INTERPRETATION

64
 DATA ANALYSIS AND
INTERPRETATION.

Introduction:

After collecting the requisite secondary data relevant for the purpose of this project
work we have collected primary data on the subject through a sample survey. Thus a suitable
questionnaire was designed to obtain the views/perceptions of respondents on relevant
aspects. A copy is placed at annexure.

Methodology:

In order to carry out the survey the random sampling method was adopted as the target was to
interview 100 employees from all the departments. The survey was conducted by meeting
the respondents personally at their convenience and choice. Accordingly most of the
respondents preferred their work place as they felt comfortable to fill the questionnaire. The
questionnaires were distributed among the respondents and it was collected then and there
itself.
The Primary data was collected by meeting 50 employees from various departments.
Since RINL/VSP is having different departments widely scattered it is proposed to conduct
the survey in only core production departments. The respondents were identified on random
basis in each department, as the availability of the respondents was not constant at each level.

Questionnaire design

The questionnaire was designed in such a way that the first five questions are pertaining to
the personal data which are in agreed nature such as designation, department etc.
Then the remaining were regarding the work environment, the relationship between
employees and management, relations between the management and trade unions.
The quantitative data was designed with forced choices of 5 scales method i.e. 0-5 level like
totally agree, agree, cannot say, disagree, totally disagree. The qualitative data was designed
by administering the open-ended questions with the ranking method so as to ascertain the
quality information from the survey findings

65
ANALYSIS OF RESPONSE:

a. Name:

The first question of the questionnaire is related to the personal matter, name of the
employee which is optional.

b. Age:

The second question of the questionnaire is also related to the personal issue, age of
the employee which is also an optional.

c.Department:
The third question of the questionnaire is related to the department.

d. Designation:
The fourth question of the questionnaire is related to the respondents, designation as
to ascertain the categories. Accordingly the 100 samples are grouped into two categories i.e.
executives and non-executives. As such the category of respondents is given below:

EXECUTIVES --- 50
(Front line, middle and senior level)

NON-EXECUTIVES ---50
(Highly skilled, Skilled and Unskilled)

e. Experience:

The third question of the questionnaire is related to the experience of the

respondents, the number of years of service. Accordingly, 100 respondents have been
grouped into three levels as such as below 10yrs, 11-20yrs and 20yrs and above. Their
response is tabulated below---

Category Up to 10 yrs 11-20 yrs 20 and above Total

Executives 7(20%) 18(51%) 10(29%) 35
Non-executives 14(22%) 44(68%) 7(10%) 65
Total 21 62 17 100

66
VIEWS OF RESPONDENTS ON VARIOUS ISSUES LISTED IN
THE QUESTIONNAIRE:
Analysis of Respondents to specific questions in the questionnaire:

On 5 scales method such as totally agree, agree, cannot say, disagree and totally
disagree for the purpose of present study of the responses are categorized into 3 I.
Agreement/Satisfactory and Undecided/Cant’ Say and Disagreement/Dissatisfaction and %
figure is worked out separately and also the graphical representation is given for all the
questions.

1. Positive IR is essential to achieve the goals of an organization?

The first question of the questionnaire is related to the concept of positive

industrial relations (IR) in VSP i.e. whether positive IR is essential in VSP to
achieve its goals and objectives. The opinion of the respondents is collected and
tabulated below:

50

40

30 Series1
Series2 Series3
20

10
0

Interpretation:

The table shows that positive IR is essential to achieve the goals of an organization with
the opinion of the employees, 65% of the respondents in executive category and 35% in non-
executive category of the respondents have agreed. There is no negative response for the
above statement as 100% of the respondents have accepted the statement.
Hence, positive IR is essential for any type of organization.

67
2 In VSP trade unions are matured & play a vital role to achieve the
growth of the organization as well as the employees.

The second question of the questionnaire is related to the concept of trade

unions importance in achieving the growth of the organization and employees in
VSP. The response obtained is given below:

50

40

30
Executives
20
Non-executives

10

0
A B % of A&B C% of CD E % of D&ETotal

Interpretation:

Regarding the maturity and the role played by the unions, 85% have agreed and 15%
have not agreed to the statement. Most of the executives and non-executives i.e. out of 85%
of the respondents, 45% of non-executives and 40% of executives have agreed the statement,
but 15% have not agreed in which 10% are executives and 5% are non-executives while 10%
respectively i.e. 7% executives and 3% non-executives could not opine anything.

68
3. Is the role of mgt. & trade unions are equally important for the better
IR scenario which directly/indirectly contributes to the functioning of the
org’n?

The above question is related to the role played by the trade unions for
better IR scenario towards the functioning of the organization. The response
regarding the statement is given below:
50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

Interpretation:

A significant factor that integration between the management and trade union is
important for better IR in an organization, 45% of executives and 45% of non-executives
have agreed the statement, whereas, 2% have not agreed, while 8% have mentioned that they
are not sure of the statement. Therefore, the majority of respondents have agreed that the role
of management and trade union are equally important for better IR.

69
4. Is IR situation is dependent on the wellbeing of the organization?

The fourth question of the questionnaire is related to know whether the

IR situation is dependent on the well-being of the organization or not. The
opinion collected is tabulated and produced below:

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The table shows that 88% of respondents, mostly non-executives have agreed that IR
situation is dependent on the well-being of the organization. 42% of executives and 46% of
non-executives has agreed the same. Only 8% of executives and 4% of non-executives have
responded that they cannot say anything on the statement.
However, the majority of respondents are in acceptance of the statement that IR
situation depends on the well-being of the organization. 12% of the respondents on this point
of view, they may not have understood the concept.

70
5. Trade union leaders should be knowledge oriented about the
organization to respond to its requirements. WHAT IS YOUR OPINION

The above question of the questionnaire is pertaining to the respondents’

opinion towards the trade union leaders whether they are knowledge oriented
about the organization to respond to its requirements. The opinion collected
from the respondents is given below:

50
45
40
35
30
25
20
15
Executives
10
Non-executives
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The table shows that 83% of the respondents out of 100 , feel that the trade union
leaders should be knowledge oriented about the organization to respond to its requirements
whereas 9% of respondents are not in acceptance to the statement. Similarly 8% of
respondents are mentioned that they have no opinion over the statement.
Out of 83% of majority respondents, it is observed that 44% of executives and 39% of
non-executives are in acceptance of the statement that trade union leaders are necessarily be
knowledge oriented about the organization to respond to its requirements. Hence, the
knowledge leader is an important element for the success of an organization.

71
6. The IR situation is congenial in VSP.

The sixth question of the questionnaire is related to the co genialness of

IR situation in VSP. The response has been tabulated below:

50
45
40
35
30
25
20
Executives
15
Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

Opinion on IR situation was obtained and it is found that 44% and 16% of non-
executives have agreed that IR situations in VSP is congenial whereas only 1% of non-
executive is not agreed. 33% of non-executives and 6% of executives have informed that they
have no opinion and this 39% of respondents who have mentioned that they have no opinion;
it is constructed that they may not aware the concept of IR required to be maintained in an
organization.

72
7. The trade unions operating in VSP are cost conscious and do not
encourage in wasteful practices, What is your opinion?
The seventh question of the questionnaire is related to the unions
operating in VSP towards cost conscious & wasteful practices. The
respondents’ response is given below:

50

40

30

20 Executives
Non-executives

10

0
AB% ofC% ofDE% of Total
A&BCD&E

Interpretation:

Opinion on the trade unions in VSP that they are cost conscious and they discourage
wasteful practices. 82% of respondents have responded positively accepting the statement.
Only 6% of the respondents have responded negatively. About 12% of respondents have
informed that they have no opinion over the role of trade unions towards cost conscious and
wasteful practices.
Hence, it is observed that 82% which forms a major portion of 100 respondents have
accepted the statement. Thus it is proved that the role of trade unions in VSP is cost
conscious and discourages wasteful practices.

73
8. Whether the participative fora in VSP play a significant role to reduce
the discontentment among workmen?

The above question in the questionnaire is related to the respondents

perception about the participative fora reduces the discontentment among
workmen in VSP or not. The response of the respondents is given below:

50
45
40
35
30
25
20
Executives
15
Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

78% of the respondents have accepted that the participative fora in VSP play a
significant role to reduce the discontentment among workmen. Only 7% of the
respondents have disagreed to the statement and 15% of the respondents have informed
that they have no opinion in this regard.
Out of 78% of the respondents who have positively responded, 40% are non-
executives 38% are executives. Therefore, the role of participative fora in VSP is vital to
reduce the discontentment among the workmen. It is to mention that participative
management in VSP is one of the parameter to devise the prevalence of better IR in
Visakhapatnam steel plant.

74
9. Is sporadic IR scenarios are mostly common in VSP?

The ninth question of the questionnaire is to ascertain the opinion

of the respondents as to know whether the sporadic IR scenarios are mostly
common in VSP or not. As above the response collected from the
respondents is shown below:

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

With regard to the sporadic IR situations, 38% of the respondents have agreed that it
is common in VSP whereas 35% of the respondents have mentioned that it is uncommon.
27% have mentioned that they have no opinion over the statement. It is observed that
there is almost equal distribution over the opinion by the respondents.

75
10. The impact of IR scenario is always noticed in VSP?

The tenth question of the questionnaire is to ascertain the opinion of the

respondents that the impact of IR scenario in VSP is noticed always or not.
The response collected has been tabulated below:

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The impact of IR is always noticed by 75% of the respondents i.e. majority of

employees and only 11% of the respondents are not finding the impact on IR . Only 14% of
the respondents have informed that they no opinion over the statement. While analyzing the
result, majority of respondents i.e., almost equal number of executives and non-executives are
observing the impact of IR scenario.

76
11. Mostof the IR situations developed due to the lack of understanding
by trade unions, Do you agree?

The eleventh question of the questionnaire is related to the respondents

perception about the IR situations developed due to the lack of understanding
by trade unions. The opinion of the respondents is collected and tabulated
below:

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

It is understood from the table that 70% of the respondents have agreed that the IR
situations are developed due to lack of understanding by trade unions in VSP, while 8% of
the respondents have not agreed to the statement and attributing it to various other factors.
About 22% of the respondents have mentioned that they have no opinion over the statement.
The rate of positive response conveys that most of the IR situations are due to the lack of
understanding between trade unions and the management.

77
 9. Whether the management is also responsible for bad IR scenario
due to the nature of demands to agree to the unions and the
workmen?

The above question is related to ascertain the opinion about the role of
management for bad IR scenario due to the demands to agree to the unions and
the workmen. The response is tabulated below

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The table shows that 71% of the respondents have agreed that management is also
responsible for bad IR scenario when the same is not agreed by 18%, while 11% of the
respondents have no opinion over the statement.

78
13. In VSP, is comprehensive and effective IR policy is followed by the
management?

The above question is to obtain the opinion of the respondents over the
comprehensive and effective IR policy in VSP is followed by the management
or not. Accordingly the opinion collected is given below:

50
45
40
35
30
25
20
Executives
15
Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

Regarding the IR policy being followed by the management of VSP, 95% of the
respondents have mentioned that it is comprehensive and effective when the same is not
agreed by only 3% which is very meager in size. Only 2% have informed that they have no
opinion over the statement. It is encouraging to note that equal number of executives and
non-executives are of the opinion that the IR policy in VSP is comprehensive and effective.

79
14. Is management going positively ahead with expansion program as they
have confidence on the IR dynamics in the plant?

The fourteenth question of the questionnaire is related to the expansion

program i.e. management is positively going ahead with the expansion
program or not as they have confidence on the IR dynamics in the plant. The
opinion of the respondents is as follows:

50
45
40
35
30
25
20
Executives
15
Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The table shows that 82% of respondents have positively responded that management
is positive with the expansion program as they have confidence over IR dynamics in the plant
and 18% have mentioned that they have no opinion on the statement. It is to denote that no
employee has given negative opinion over the progress and the expansion activities in which
both management and union are confident to achieve the expansion within the schedule. 18%
of the respondents who have no opinion over the statement are treated to be unaware about
the expansion activities and its status; it might be due to their lack of knowledge over the
expansion program.

80
15. The management – union relationship is strengthened by the
participative management, do you agree?

The fifteenth question of the questionnaire is all about the management –

union relationship that is strengthened by the participative management. The
response collected from the respondents is tabulated below:

50
45
40
35
30
25
20
Executives
15
Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The relationship of management – union is being strengthened by the participative

management as 90% of the respondents have responded positively when only 3% of the
respondents have not agreed the concept. 6% of respondents have responded that they have
no opinion over the statement.

81
 16. In VSP, is management has been always successful to keep the IR
situation under control?

The sixteenth question of the questionnaire is related to the

successfulness in keeping the IR situations under control in VSP. The
response collected from the respondents is given below:

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

82% of the respondents have responded that the IR situation is under control and
management has been always successful in it, when 5% of the respondents have disagreed
and 13% have responded that they have no opinion over the statement. It is to appreciate
that equal number of executives and non-executives of 41% each have realized that the IR
situation is kept under control by the management of VSP.

82
17. Is the situation of multiplicity of trade unions is a discouraging factor in
VSP commonly for uncomfortable IR scenario?

This question is to ascertain the opinion of the respondents whether the

multiplicity of trade unions is a discouraging factor in VSP or not, commonly
for uncomfortable IR scenario. The opinions of the respondents is tabulated and
given below:

50
45
40
35
30
25
20
15 Executives
10 Non-executives
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

The uncomfortable IR scenario in VSP is due to multiplicity of trade unions and it is a

discouraging factor. 62% of the respondents have responded that the multiplicity of trade
unions in VSP is not an encouraging trend and it creates uncomfortable IR scenario during
the collective bargaining process, whereas 20% of the respondents have disagreed and 18%
of the respondents have responded that they have no opinion in this regard.

83
18. If unions affiliated to National level parties have a better scope to
contribute towards harmonious IR situation?

The above question is related to know the opinion of the respondents

about the National level parties towards harmonious IR situation. The opinion
of the respondents is shown below:

50
45
40
35
30
25
20 Executives
15 Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

About 82% of the respondents have opined that the unions which are National
affiliated i.e., National level trade unions contributes better for harmonious IR situation than
the state affiliated and independent unions. It is to observe that only 10% of the respondents
have not agreed to the statement, while 8% of the respondents have informed that they have
no opinion towards the statement.

84
 19. IR scenario is one of the factors to gauge the performance of the
organization, what is your opinion?

The above question of the questionnaire is related to IR scenario that

gauges the performance of the organization. The opinion collected is shown
below:

50
45
40
35
30
25
20
Executives
15
Non-executives
10
5
0

AB% ofC% ofDE% of Total

A&BCD&E

Interpretation:

It is to observe that 88% of the respondents feel that IR in an organization is one of

the parameter to check the performance of the organization when 10% of the respondents
have not agreed and only 2% have informed that they have no opinion over the statement.
IR is one of the factors to assess the success of the organization. Hence, an
organization is greatly dependent upon the IR for mutual beneficial association.

85
20. Open question

This is the last question of the questionnaire through which we have collected
some suggestions from the employees i.e. both from the executive and non-
executive groups regarding the changes to be made by the management for
having better IR climate in VSP. The suggestions given by the employees are
as follows:

Suggestions:
 Co-operation between management and unions can sort out IR problem in VSP.

 For anything, organization interest is the key.

 The employees should maintain good relations with the management.

 Collective Bargaining is required for the settlement of the various issues.

 Multiplicity of trade unions should be discouraged.

 Workers Participation in the management will improve productivity.

 Strengthening of Workers – Management relationship is essential for the successful IR.

 Any issue that arises should be discussed across the table before it is taken to the
management.

 When the organization believes that their success lies in their human capital, there will
not be any IR situation in the organization.

 Structural meeting in a systematic way will help to improve IR in VSP.

86
 CHAPTER 5

SUMMARY
FINDINGS AND
SUGGESTIONS
CONCLUSION
ANNEXTURES
BIBILOGRAPHY

87
SUMMARY:

The overall Industrial Relations scenario in RINL / VSP is peaceful, cordial and
healthy. A host of proactive IR measures which inter-alia include Confidence
Building Measures (C B MS) between Union – Management, Extensive
communication, continuous interaction with unions and partnership in
Management in various participative forums have helped in developing a
congenial IR climate propitious for high production and productivity. With the
dedication and commitment of VSP collective, the organization has surmounted
all odds and achieved best ever records by crossing its rated capacities
continuous efforts to improve the employee’s morale have resulted in improving
the technological and operational discipline which ultimately helped in
heightening the motivation of the employees.

It is noticed that since inception Visakhapatnam Steel Plant has signed

successive Wage Settlements with the Recognized Union. The notable features
of the implementation are productivity and production. Apart from this a
number of settlements on various issues like Promotions, incentives and welfare
measures etc., have been reached with the union which have helped enhancing
the morale and motivation of the employees. The most important feature in
Visakhapatnam Steel Plant is the spirit of joint consultation, which is being
persuaded in all matters of work related issues.

One of the most important factors is the productive work culture, which is
being considered as of crucial importance in Visakhapatnam steel plant. As
such several initiatives have been taken to adopt a multi-skill and multi-trade
pattern of working with emphasis on flexibility in job deployment thus ensured
the optimum utilization of its human resources. To augment the above,
Visakhapatnam Steel Plant has bagged runners-up award in the year 1994 in
recognition of excellence in Management, which has facilitated harmonious
industrial relations in the organization. Visakhapatnam Steel Plant also bagged
the best Management award for the year 2000-01 from the State government of
Andhra Pradesh for outstanding contribution in maintenance of industrial
relations, labor welfare and productivity.

88
FINDINGS:

According to the opinion of various respondents in VSP it was found that

majority of employees are satisfied with the existing IR scenario in VSP. As we
all know that human wants are unlimited there do few employees who
expressed their dissatisfaction with the various IR practices exist in VSP?

The following are the findings of my study.

1. The overall IR situation is very cordial.

2. The safety measures and welfare measures taken by the management

of VSP are good.

3. All the employees of the organization are satisfied with the

disciplinary procedures and working conditions.

4. Grievance redressal forum is working very well.

5. Management attitude is positive towards the settlement of grievances,

because all the grievances are settled at the initial stages (i.e., at unit
level)

6. Understanding between the superiors and subordinates is formal and

cordial.

7. Political affiliation and Inter-union rivalry are the main cause for the
disputes between trade unions.

8. Some of the employees are not satisfied with the functioning of Trade
Unions.

9. The employees are very much satisfied with the participative

management prevailing in VSP.

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SUGGESTIONS:

1. It is better that Trade Unions should not have affiliation with Political
parties.

2. There should be a Grievance Handling Committee each at shop floor

level and at every departmental level. It should review its functions at
regular intervals.

3. There should be a proper and adequate two-way communication

between management and workers to increase the morale of both
executives and workers and ensure peaceful industrial relations and
thereby achieve better production & productivity.

4. To discourage the multiplication of trade unions it should discouraged

or restricted at the stage of registration itself by the Registering
Authority.

5. Leader’s development training programs should be conducted to

develop the leadership skills.

CONCLUSION:
Visakhapatnam Steel Plant has been considered as the best industrial
relations plant in the country with the young and dedicated workforce. In
true with its concept, VSP has formulated contingent plans to maintain
industrial peace through harmonious relations between management and
employees. It helps the management to gain the support of employees for
the promotion and implementation of its plans and procedures. To sustain a
peaceful IR climate throughout the plant, VSP initiated continuous
interactions with employees and unions, proactive IR initiatives to maintain
harmonious relations, effective functioning of participative committees. One
of the controlling absenteeism was introduced of Dial Attendance Recording
System (DARS). Another notable step is access to the Chief Executive
Officer (CEO) through “ACCESS” scheme for redressal of employees

90
grievances. Communication between employees and the top management is
being facilitated through open house forums.

Progressive concept of Joint Consultative Machinery (JCM) was set up in

the year 1996 with 3 major unions which secured more than 15% of votes
polled in elections with a view to reduce inter-union conflicts and to achieve
consensus on several work related issues and also to provide unions
participation in the management. Around 66 participative committees were
constituted in the areas like safety, canteen, welfare, recreation, sports &
games, provident fund trust, Superannuation Benefit Fund Scheme and Shop
Floor Cooperative Committees. The creativity of employees is nurtured and
exploited by VSP through Suggestion Scheme. This Scheme not only help
the plant by way of substantial savings also motivates the employees through
recognition. VSP also introduced Quality Circles (QCs) in a big way to
facilitate the employees to discuss the work related problems and come out
with suitable solutions.

In recognition, the Government of Andhra Pradesh presented the “Best

Management Award” to VSP on May Day for outstanding contribution in
maintenance of industrial relations, labor welfare and Productivity. The
Government has also given a Citation in 1994 in recognition of excellent IR
established by it.

VSP thus emerged as a major corporate benefactor in Socio-economic

development of this region with its proven record of high labor productivity,
international levels of efficiency and ability for foster new work culture. No
wonder VSP is poised to be a pioneer in setting new trend in public
enterprise management.

91
 ANNEXURES
AND
BIBLIOGRAPHY

92
 ANNEXURE

A STUDY ON HEALTHY INDUSTRIAL RELATIONS IN

VISAKHAPATNAM STEEL PLANT

Please find here under a few statements with five options for
each and I request you to please indicate one option which is most
appropriate, in your opinion, by making tick in the relevant column. I
undertake to state this information shall be used only for my project work.

1 NAME:

2 AGE:

3 DEPARTMENT:

4 DESIGNATION:

5 EXPERIENCE IN VSP (YEARS):

S.No. Totally Cannot

Statement Agree Agree Say Disagree Totally
Disagree
1. Is Positive IR is essential to
achieve the goals of an
organization.

2. In VSP, trade unions are

matured & play a vital role to
achieve the growth of the
organization as well as the
employees.

93
3. The role of mgt. & Trade
unions are equally important
for the better IR scenario,
which directly or indirectly
contributes to the functioning
of the organization.

4. IR situation is dependent on
the well-being of the
organization.

5. Trade union leader should be

knowledge oriented about the
org’n to respond to its
requirements.

6. The IR situation is congenial in

VSP.

7. The trade unions operating in

VSP are cost conscious & do
not encourage wasteful
practices.

8. The participative fora in VSP

play a significant role to
reduce the discontentment
among workmen.

9. Sporadic IR scenarios are

mostly common in VSP.

10. The impact of IR scenario in

VSP is always noticed.

11. Most of the IR situations

developed due to the lack of
understanding by trade unions.

94
12. Management is also
responsible for bad IR scenario
due to the nature of demands
to agree to the unions and the
workmen.

13. In VSP, comprehensive &

effective IR policy is followed
by the mgmt.

14. Management is positively

going ahead with expansion
program as they have
confidence on the IR dynamics
in the plant.

15. The management – union

relationship is strengthened by
the participative management.

16. In VSP, management has been

always successful to keep the
IR situation under control.

17. Multiplicity of trade unions is

a discouraging factor in VSP
commonly for uncomfortable
IR scenario.

18. Unions affiliated to national

level parties have a better
scope to contribute towards
harmonious IR situations.

19. IR scenario is one of the

factors to gauge the
performance of the
organization.

95
 BIBILOGRAPHY

MANAGEMENT OF HUMAN RESOURCES -- L.M. PRASAD

HUMAN RESOURCE MANAGEMENT -Dr. P.SUBBA RAO

INDUSTRIAL RELATIONS - Dr. P.SUBBA

RAO UNION MANAGEMENT RELATIONS AND

GLOBALIGATION -- C.S.VENKATA RATNAM

SPECTRUM OF INDUSTRIAL RELATIONS -- BAGARAM TUPULE

INDUSTRIAL RELATIONS IN INDIA AND WORKERS

INVOLVEMENT IN MANAGEMENT -- V.P.MICHAEL

96