Industrial Relations

INDUSTRIAL RELATION
The relationship between Employer and employee or
trade unions is called Industrial Relation.
Harmonious relationship is necessary for both
employers and employees to safeguard the interests
of the both the parties of the production.
In order to maintain good relationship with the
employees, the main functions of every organization
should avoid any dispute with them or settle it as
early as possible so as to ensure industrial peace and
higher productivity.

 Personnel management is mainly concerned

with the human relation in industry because the
main theme of personnel management is to get
the work done by the human power and it fails in
its objectives if good industrial relation is
maintained. In other words good Industrial
Relation means industrial peace which is
necessary for better and higher productions.

 Industrial society is a complex and dynamic

society (consist of group, societies and
institution) they are interrelated, however have
different attitudes and perceptions. They are also
being influenced by external environment.
We cannot ignore the working aspect of human
being, as working hour dominate most of our
time.

What is Industrial Relations?

A particular set of phenomena associated with
regulating the human activity of employment
The making and administering of the
institutions and rules of work regulation
Socio-industrial conflict (in all its forms) and
its resolution
Explicit and implicit bargaining between
employees and employers

Definitions:
Industrial relations have been defined by some
of the thinkers a follows:1.Industrial relations and personnel
management are almost synonymous term with
the only difference the former places emphasis
on the aspect of employer relationship rather
than on the executive policies and activities that
are set up to foster good
relations.
-E.F.L.Brec

2.Industrial relations is that part of

management which is concerned with the
man power of the enterprise- whether
machine operator, skilled worker or
manager.
-Bethel,Smith&other

3. 'Industrial relationship is the composite result of the

attitudes and approaches the employers and
employees towards each other with regard to planning,
supervision, direction and co-ordination of the
activities of an organization with a minimum of human
efforts and friction, with an animating sprite of cooperation and with proper regard for the genuine wellbeing of all the members of the organization.
-Tead&Matcal

 Industrial Relation is a relation between employer

and employees, employees and employees and
employees and trade unions.
- IndustrialdisputeAct1947
While moving from jungle of the definitions, here,
Industrial Relation is viewed as the process by
which people and their organizations interact at the
place of work to establish the terms and conditions
of employment.

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 encompasses a set of phenomena,
both inside and outside the workplace, concern with
determining and regulating employment relationship.

There are different types of organizations:

1.Big organization, small organization, local or international.
2. They constitute of 3 main actors:
Shareholder- represented by management, association of
employers. Always to gain as much profit and productivity.
Employees- being represented by trade unions. To get good
salary and good working conditions
Government; being represented by specialize government
agencies concern with workers, enterprise and their
relationship. Try create industrial harmony
Each of the actors above always conflicting between one another
in order to achieve their objectives.
3. Besides the above 3 main actors, in the present context
academicians have also considered another actor which can also
influence the nature of IR i.e Stakeholders.

 In modern times, production is carried on in large

factories where thousands of men work together. The
personnel management is mainly responsible for the
control of human beings through human relations
approaches. Men differ in nature and therefore, it is
but a natural that labour problems shall also exist in
the industrial society. The main problems which are
generally faced by the industry are:
1.Absenteeism,
2.Labour turnover,
3.Health,
4.Accidents.

Objectives of Industrial Relation

A.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.
B. 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.

C. To raise productivity to a higher level in an era of

full employment by lessening the tendency to high
turnover and frequency absenteeism.
D. To establish and nurse 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.

 E. To eliminate, as far as is possible and

practicable, strikes, lockouts and gheraos by
providing reasonable wages, improved living and
working conditions, said fringe benefits.
F. To establish government control of such plants
and units as are running at a loss or in which
productions has to be regulated in the public
interest.
G. Improvements in the economic conditions of
workers in the existing state of industrial
managements and political government.

 H. Control exercised by the state over industrial

undertaking with a view to regulating production and
promoting harmonious industrial relations.

I. Socializations or rationalization of industries by

making he state itself a major employer
J. Vesting of a proprietary interest of the workers in the
industries in which they are employed.

The main aspect of

Industrial Relations are -

i. Labor Relations, i.e. relations between union and

management.
ii. Employer-employees relations, i.e. relations
between management and employees.
iii. Group relations, i.e. relations between various
groups of workmen.

 iv. Community or Public relations, i.e. relations

between industry and society.
v. Promotions and development of healthy labormanagements relations.
vi. Maintenance of industrial peace and avoidance
of industrial strife.
vii. Development of true industrial Democracy.

IMPORTANCE OF INDUSTRIAL RELATIONS

The healthy industrial relations are key to the progress.
Their significance may be discussed as under -

1. Uninterruptedproduction
The most important benefit of industrial relations is
that this ensures continuity of production. This means,
continuous employment for all from manager to
workers. The resources are fully utilized, resulting in the
maximum possible production. There is uninterrupted
flow of income for all. Smooth running of an industry is
of vital importance for several other industries; to other
industries if the products are intermediaries or inputs; to
exporters if these are export goods; to consumers and
workers, if these are goods of mass consumption.

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

3.Highmorale

Good industrial relations improve the morale of the

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

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

5. NewProgrammes
New programmes for workers development are introduced
in an atmosphere of peace such as training facilities, labor
welfare facilities etc. It increases the efficiency of workers
resulting in higher and better production at lower costs.

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

Determining factors of industrial relations

Good industrial relations depend on a great variety of factors.
Some of the more obvious ones are listed below:
1. Historyofindustrialrelations
No enterprise can escape its good and bad history of industrial
relations. A good history is marked by harmonious relationship
between management and workers. A bad history by contrast is
characterized by militant strikes and lockouts. Both types of
history have a tendency to perpetuate themselves. Once
militancy is established as a mode of operations there is a
tendency for militancy to continue. Or once harmonious
relationship is established there is a tendency for harmony to
continue.

2. Economicsatisfactionofworkers
Psychologists recognize that human needs have a
certain priority. Need number one is the basic
survival need. Much of men conducted are
dominated by this need. Man works because he
wants to survive. This is all the more for
underdeveloped countries where workers are still
living under subsistence conditions. Hence
economic satisfaction of workers is another
important prerequisite for good industrial
relations.

3.SocialandPsychologicalsatisfaction
Identifying the social and psychological urges of workers is
a very important steps in the direction of building good
industrial relations. A man does not live by bread alone.
He has several other needs besides his physical needs
which should also be given due attention by the employer.
An organization is a joint venture involving a climate of
human and social relationships wherein each participant
feels that he is fulfilling his needs and contributing to the
needs of others. This supportive climate requires economic
rewards as well as social and psychological rewards such
as workers participation in management, job enrichment,
suggestion schemes, re-dressal of grievances etc.

4. Off-the-Job Conditions
An employer employs a whole person rather than certain
separate characteristics. A persons traits are all part of one
system making up a whole man. His home life is not
separable from his work life and his emotional condition is
not separate from his physical condition. Hence for good
industrial relations it is not enough that the workers
factory life alone should be taken care of his off-the-job
conditions should also be improved to make the industrial
relations better.

5. Enlightened Trade Unions

The most important condition necessary for good
industrial relations is a strong and enlightened
labor movement which may help to promote the
status of labor without harming the interests of
management, Unions should talk of employee
contribution and responsibility. Unions should
exhort workers to produce more, persuade
management to pay more, mobilize public
opinion on vital labor issues and help
Government to enact progressive labor laws.

6. Negotiating skills and attitudes

of management and workers
Both management and workers representation in the area
of industrial relations come from a great variety of
backgrounds in terms of training, education, experience and
attitudes. These varying backgrounds play a major role in
shaping the character of industrial relations. Generally
speaking, well-trained and experienced negotiators who are
motivated by a desire for industrial peace create a bargaining
atmosphere conducive to the writing of a just and equitable
collective agreement.

On the other hand, ignorant, inexperienced and illtrained persons fail because they do not recognize that
collective bargaining is a difficult human activity which
deals as much in the emotions of people as in their
economic interests. It requires careful preparation and
top notch executive competence. It is not usually
accomplished by some easy trick or gimmick. Parties
must have trust and confidence in each other.

7. Public policy and legislation

when Government, regulates employee
relations, it becomes a third major force
determining industrial relations the first two
being the employer and the union. Human
behavior is then further complicated as all three
forces interact in a single employee relation
situation. Nonetheless, government in all
countries intervenes in management union
relationship by enforcing labor laws and by
insisting that the goals of whole society shall take
precedence over those of either of the parties.

Government intervention helps in three different

ways
1) it helps in catching and solving problems before
they become serious. Almost every one agrees
that it is better to prevent fires them to try
stopping them after they start;
2) It provides a formalized means to the workers
and employers to give emotional release to their
dissatisfaction; and
3) It acts as a check and balance upon management
action.

8. Better education: with rising skills and education workers

expectations in respect of rewards increase. It is
a common knowledge that the industrial worker
in India is generally illiterate and is misled by
outside trade union leaders who have their own
axe to grind. Better workers education can be a
solution to this problem. This alone can provide
worker with a proper sense of responsibility,
which they owe to the organization in particular,
and to the community in general.

9. Nature of industry
In those industries where the costs constitute a
major proportion of the total cast, lowering
down the labor costs become important when
the product is not a necessity and therefore,
there is a little possibility to pass additional costs
on to consumer. Such periods, level of
employment and wages rise in decline in
employment and wages. This makes workers
unhappy and destroys good industrial relations.

SCOPE OF INDUSTRIAL RELATIONS WORK

The staff employed in the industrial relations

department should know the limitations within
which it has to function. The industrial relations
director generally has several assistants who
help him to perform his functions effectively,
and he usually reports directly to the president
or chairman of the board of directors of an
organization.

The functions of the industrial relations staff are 1. Administration, including overall organization, supervision and co-

ordination of industrial relations policies and programmes.

2. Liaison with outside groups and personnel departments as well as

with various cadres of the management staff.
3. The drafting of regulations, rules, laws or orders and their
construction and interpretation.
4. Position classification, including overall direction of job analysis,
salary and wage administration, wage survey and pay schedules.
5. Recruitment and employment of workers and other staff.
6. Employment testing, including intelligence tests, mechanical
aptitude tests and achievement tests.

7. Placement, including induction and assignment.

8. Training of apprentices, production workers, foremen and
executives.
9. Employee counseling on all types of personnel problemseducational, vocational, health or behavior problems.
10. Medical and health services.
11. Safety services, including first aid training.
12. Group activities, including group health insurance, housing,
cafeterias programmes and social clubs.
13. Suggestion plans and their uses in labor, management and
production committees.

14. Employee relations, specially collective bargaining with

representatives and settling grievances.
15. Public relations.
16. Research in occupational trends and employee attitudes, and
analysis of labor turnover.
17. Employee records for all purposes.
18. Control of operation surveys, fiscal research and analysis.
19. Benefit, retirement and pension programmes.

FUNCTIONAL REQUIREMENTS OF A SUCCESSFUL INDUSTRIAL

RELATIONS PROGRAMME

The basic requirements on which a successful industrial

relations programme is based are :a)TopManagementSupport: - Since industrial relations is a

functional staff service, it must necessarily derive its authority from

the line organization. This is ensured by providing that the industrial
relations director should report to a top line authority to the
president, chairman or vice president of an organization.

b)SoundPersonnelPolicies: - These constitute the business

philosophy of an organization and guide it in arriving at its human
relations decisions. The purpose of such policies is to decide, before
any emergency arises, what shall be done about the large number of
problems which crop up every day during the working of an
organization. Policies can be successful only when they are followed
at all the level of an enterprise, from top to bottom.

 c)AdequatePractices should be developed by

professionals: - In the field to assist in the implementation of the

policies of an organization. A system of procedures is essential if
intention is to be properly translated into action. The procedures
and practices of an industrial relations department are the tool
of management which enables a supervisor to keep ahead of his
job that of the time-keeper, rate adjuster, grievance reporter and
merit rater.

d)DetailedSupervisoryTraining:- To ensure the

organizational policies and practices are properly implemented

and carried into effect by the industrial relations staff, job
supervisors should be trained thoroughly, so that they may
convey to the employees the significance of those policies and
practices. They should, moreover, be trained in leadership and in
communications.

e) Follow-up of Results: A constant review of an industrial relations

programme is essential, so that existing practices may
be properly evaluated and a check may be exercised on
certain undesirable tendencies, should they manifest
themselves. A follow up of turnover, absenteeism,
departmental morale, employee grievances and
suggestion; wage administration, etc. should be
supplemented by continuous research to ensure that
the policies that have been pursued are best fitted to
company needs and employee satisfaction. Hints of
problem areas may be found in exit interviews, in
trade union demands and in management meetings, as
well as in formal social sciences research

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

Psychologicalapproach
According to psychologists, problems of industrial
relations have their origin in the perceptions of the
management, unions and rank and file workers. These
perceptions may be the perceptions of persons, of
situations or of issues involved in the conflict. The
perceptions of situations and issues differ because the
same position may appear entirely different to different
parties. The perceptions of unions and of the
management of the same issues may be widely different
and, hence, clashes and may arise between the two
parties. Other factors also influence perception and may
bring about clashes.

 The reasons of strained industrial relations between the

employers and the employees can be understood by
studying differences in the perception of issues, situations
and persons between the management groups and labour
groups.
The organizational behavior of inter-groups of management
and workers is of crucial importance in the pattern of
industrial relations. The group-dynamics between the two
conflicting groups in industrial relations tend to shape the
behavioural pattern.

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

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

Roleofmanagementinindustrialrelations
The management have a significant role to play in
maintaining smooth industrial relations. For a positive
improvement in their relations with employees and
maintaining sound human relations in the organization, the
management must treat employees with dignity and respect.
Employees should be given say in the affairs of the
organization generally and wherever possible, in the
decision-making process as well. A participative and
permissive altitude on the part of management tends to give
an employee a feeling that he is an important member of the
organization a feeling that encourages a spirit of
cooperativeness and dedication to work.

 Management must make a genuine efforts to provide

congenial work environment.
They must make the employees feel that they are
genuinely interested in their personal development.
To this end, adequate opportunities for appropriate
programmes of 18training and development should be
provided.
Managements must delegate authority to their
employees commensurate with responsibility.

 They must evolve well conceived and scientific

wage and salary plan so that the employees may
receive just compensation for their efforts. They
must devise, develop and implement a proper
incentive plan for personnel at all levels in the
organization.
There must be a well-planned communication
system in the organization to pass on information
and to get feed back from the employees.

 Managements must pay personal attention to the

problems of their employees irrespective of the
fact whether they arise out of job environment or
they are of personal nature.
They must evolve, establish and utilize
appropriate machineries for speedy redressal of
employees grievances.
Managements must provide an enlightened
leadership to the people in the organization.