Introduction & Industrial Relations in India - Industrial Relations, Human Resource Management | Human Resource Management - B Com PDF Download

Introduction
Industrial relations has become one of the most delicate and complex problems of modern industrial society. Industrial progress is impossible without cooperation of labors and harmonious relationships. Therefore, it is in the interest of all to create and maintain good relations between employees (labor) and employers (management).

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

Definitions:
The term ‘industrial relations’ has been variously defined. J.T. Dunlop defines industrial relations as “the complex interrelations among managers, workers and agencies of the governments”. 

According to Dale Yoder “industrial relations is the process of management dealing with one or more unions with a view to negotiate and subsequently administer collective bargaining agreement or labour contract”.

The HR Employee Relations Manager directs the organization's employee relations function. They develop employee relations policies and ensure consistent application of company policies and procedures. In addition, they are responsible for employee dispute resolution procedures, performing internal audits, and taking appropriate action to correct any employee relations issues.

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

Importance of Industrial Relations:
The healthy industrial relations are key to the progress and success. Their significance may be discussed as under – 

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

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

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

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

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

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

 

Objectives of Industrial Relations: 
The main objectives of industrial relations system are:-

1. To safeguard the interest of labor and management by securing the highest level of mutual understanding and good-will among all those sections in the industry which participate in the process of production.

2. To avoid industrial conflict or strife and develop harmonious relations, which are an essential factor in the productivity of workers and the industrial progress of a country.

3. To raise productivity to a higher level in an era of full employment by lessening the tendency to high turnover and frequency absenteeism.

4. To establish and promote the growth of an industrial democracy based on labor partnership in the sharing of profits and of managerial decisions, so that ban individuals personality may grow its full stature for the benefit of the industry and of the country as well.

5. To eliminate or minimize the number of strikes, lockouts and gheraos by providing reasonable wages, improved living and working conditions, said fringe benefits.

6. To improve the economic conditions of workers in the existing state of industrial managements and political government.

7. Socialization of industries by making the state itself a major employer

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

Industrial Relations in India
Prior to 1991, the industrial relations system in India sought to control conflicts and disputes through excessive labor legislations. These labor laws were protective in nature and covered a wide range of aspects of workplace industrial relations like laws on health and safety of labors, layoffs and retrenchment policies, industrial disputes and the like. The basic purpose of these laws was to protect labors. However, these protectionist policies created an atmosphere that led to increased inefficiency in firms, over employment and inability to introduce efficacy.With the coming of globalization, the 40 year old policy of protectionism proved inadequate for Indian industry to remain competitive as the lack of flexibility posed a serious threat to manufacturers because they had to compete in the international market.

With the advent of liberalization in1992, the industrial relations policy began to change. Now,the policy was tilted towards employers. Employers opted for workforce reduction, introduced policies of voluntary retirement schemes and flexibility in workplace also increased. Thus, globalization brought major changes in policy in India. The changes can be summarized as follows:

• Collective bargaining in India has mostly been decentralized, but now in sectors where it was not so, are also facing pressures to follow decentralization.

• Some industries are cutting employment to a significant extent to cope with the domestic and foreign competition e.g. pharmaceuticals. On the other hand, in other industries where the demand for employment is increasing are experiencing employment growths.

• In the expansionary economy there is a clear shortage of managers and skilled labor.

• The number of local and enterprise level unions has increased and there is a significant reduction in the influence of the unions.

• Under pressure some unions and federations are putting up a united front e.g. banking.

• Another trend is that the employers have started to push for internal unions i.e. no outside affiliation.

• HR policies and forms of work are emerging that include, especially in multi-national companies,multi-skills, variable compensation, job rotation etc. These new policies are difficult to implement in place of old practices as the institutional set up still needs to be changed.

• HRM is seen as a key component of business strategy.

Training and skill development is also receiving attention in a number of industries, especially banking and information technology.