Industrial relation means the relationship between

employers and employees in course of employment in

industrial organizations.

Industrial relation is used to denote the collective

relationships between management and the worker.

IR is used to cover such aspects of industrial life as trade

unionism, collective bargaining, workers participation in

management , discipline and industrial disputes.

Definition: According to J.T. Dunlop, “Industrial relations are

the complex interrelations among managers, workers and

agencies of the government”

CONCEPT OF INDUSTRIAL RELATIONS

• The understanding between employees and management in

an industrial organisation is commonly called industrial

relations.

• According to “Dale Yoder, IR is a designation of a whole field

of relationship that exists because of the necessary

collaboration of men and women in the employment

processes of industry”.

• “IR is concerned with the systems and procedures used by

unions and employers to determine the reward for effort and

other conditions of employment, to protect the interests of the

employed and their employers and to regulate the ways in

which employers treat their employees.”

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CONCEPT OF INDUSTRIAL

RELATIONS

• IR can be defined as a coin having two faces: co-

operation and conflict. This relationship undergoes

starting with co-operation soon changes into conflict

and after its resolution again changes into co-

operation. This changing process becomes a

continuous feature in industrial system and makes

IR concept as dynamic and evolving one.

Evolution of IR In India :Pre-

Independence :

• Hired and Fired

• Poor Employment wages

• Due to strikes and disturbances, government

enacted the Trade Dispute Act, 1929. (based on

British Industrial Court Act 1919. but there was no

machinery for settling dispute.)

• In 1938, Bombay government enacted Bombay

Industrial relations Act. First time with machinery

(Industrial court)

IR in Post-Independence

period

Enactment for Industrial Dispute Act, 1947.

Setting up of Indian Labour Conference (ILO), a

tripartite body to look into IR problems in India. (co-

operation between government, labour and

organization)

Many Labour Laws enacted to protect industrial

workerduring 1947 to 1956.

In 1956 emphasis shifted from legal enactment to

voluntary arrangements

• Establishment of work committees, joint

management councils, recognition of

unions,worker’s participation schemes

• 1966,National Commission of labor was appointed

by the government to look into labor matters and

make recommendations. It submitted the report in

1969. The recommendations were never

implemented though few were in the implementation

stage.

• A conference called the Industrial Truce Resolution

took place in 1947, and foresaw the establishment

of the Minimum Wages Act, Factories Act, and

Employees State Insurance Act in 1948. This

ensured peace between labor and industry.

MAIN ASPECTS OF

INDUSTRIAL RELATIONS

Promotion and development of healthy labor-

management relations.

Maintenance of industrial peace and avoidance of

industrial conflict.

Development and growth of industrial democracy.

SCOPE OF INDUSTRIAL

RELATIONS

Labour relations, i.e. relations between labour union

and management.

Employer- employee relations,i.e. relations between

management and employees.

The role of various parties in maintaining industrial

relations.

The mechanisms of handling conflicts between

employers and employees, in case conflicts arises.

OBJECTIVES OF

INUSTRIAL RELATIONS

• Establish and foster sound relationship between

workers and management by safeguarding their

interests.

• Avoid industrial conflicts and strikes by developing

mutuality among the interests of concerned

parties.

• Keep, as far as possible, strikes, lockouts at bay by

enhancing the economic status of workers.

OBJECTIVES OF IR

• Provide an opportunity to the workers to participate

in management and decision making process.

• Raise productivity in the organization to curb the

employee turnover and absenteeism.

• To improve the bargaining capacity of the workers

through trade unions.

• To ensure discipline in the organization and in the

industry.

• Improvement of economic conditions of workers.

OBJECTIVES OF IR

• To safeguard the interests of the labor and the

management by preventing one of the players from

getting a strong hold over the other.

• To develop & Secure mutual understanding & good

relationships among all the players in the industrial

set-up.

• To maintain industrial peace & harmony by

preventing industrial conflicts.

OBJECTIVES OF IR

• To improve the standard of living of the average

worker by providing basic and standard amenities.

• To increase productivity by minimizing industrial

conflicts and maintaining harmonious industrial

relations.

• To provide a basic framework for the management &

the employees to resolve their differences.

IMPORTANCE OF IR

Foster industrial peace.

Promote industrial democracy.

Benefit to workers.

Benefit to management.

Improve productivity.

PARTIES TO IR

Employees

Employers

Government

UNITARY APPROACH

• UNITARY APPROACH is grounded in mutual

cooperation, individual treatment, team work and

shared goals.

• Work place conflict is seen as temporary aberration,

resulting from poor management. Employees who

do not mix well with organization culture Unions

cooperate with the management.

• Management’s right to manage is accepted because

there is no ‘we they” feeling Underlying assumption

is that everyone benefits when the focus is on

common interest and promotion of harmony Based

on reactive strategy.

Pluralist Approach

• The pluralist approach was developed in the USA by

John T commons.

• PLURALISM(CONFLICT APPROACH )Pluralism is

belief in the existence of more than one ruling

principle, giving rise to a conflict of interests.

• The pluralist approach to IR accepts conflict

between management and workers as inevitable but

compromised through various institutional

arrangements ( like collective bargaining,

conciliation and arbitration etc) and is in fact

considered essential for innovation and growth.

• It perceives organizations as coalitions of competing

interests , where the management’s role is to

mediate among the different interest groups.

• It perceives trade unions as legitimate

representative of employee interests It also

perceives stability in IR as the product of

concessions and compromises between

management and unions

MARXIST APPROACH

• MARXIST APPROACH Marxists like pluralists also

regard conflict as inevitable but see it as a product

of capitalistic society where as pluralist believe that

the conflict is inevitable in all organizations

• For Marxists IR has wider meaning. For them

conflict arises not because of rift between

management and workers but because of the

division in the society between those who own

resources and those who have only labor to offer.

• Marxist approach thus focuses on the type of society

in which an organization functions.

• Industrial conflict is thus equated with political and

social unrest. Trade Unions are seen both as labor

reaction to exploitation by capitalists, as- well-as a

weapon to bring about a revolutionary social

change.

Systems approach

• The system approach was developed by Dunlop of

Harvard University in 1958.

• According to this approach, individuals are part of an

ongoing but independent social system.

• The behaviour, actions and role of the individuals

are shaped by the cultures of the society.

• The three elements of the system approach are

input, process and output.

• Society provides the cue (signal) to the individuals

about how one should act in a situation.

• The institutions, the value system and other

characteristics of the society influence the process

and determine the outcome or response of the

individuals. The basis of this theory is that group

cohesiveness is provided by the common ideology

shaped by the societal factors.

Dunlop’s Systems Approach

INPUTS

Actors

(Employees, Employers,

State)

Context

(Tech,Market,Power

Indeology)

PROCESSES

Bargaining

Conciliation

Arbitration

Adjudication

Legislation

OUTPUT

Rules

Feedback

CONFRONTING CHALLENGES

FACED BY IR

NATURE OF WORK

DISSATISFACTORY COMPENSATION

AND WORK CONDITIONS

DYFUNCTIONAL TRADE UNIONS

EMPLOYER FLEXIBILITY

NON CONDUCIVE ORGANISATIONAL

CLIMATE

NATURE OF WORK

• A good work i.e., work interesting to the employee fosters

good IR. This result in job satisfaction. On contrary, a

work not interesting to the employee breeds bad or poor

IR.

DISSATISFACTORY

COMPENSATION

• Employees works for compensation i.e., wages and

salaries. Often, compensation as low and working

conditions as poor viewed by employees become an

important reason for poor IR. This worsen relationship

between employees and management.

NON CONDUCIVE

ORGANISATIONAL CLIMATE

A conducive an supporting organizational climate helps

employees integrate themselves with organization and

enjoy a feeling of confidence and the opposite creates

mistrust between employees and organization.

EMPLOYERS FLEXIBILITY

In general, the requirements of modern business include

more flexible management and work organization,

focusing on creating a smarter and more motivated work

force and culturally sensitive management techniques

DYFUNCTIONAL TRADE

UNIONS

• Trade unions are meant to protect the interests of its

members. The unions are used as a means to serve the

purposes of a few leaders rather than working in the wider

interest of the employees.

HOW TO BUILD SOUND IR

• Developing Trust Between Labor and Management

• Existence of Sound and Democratic Trade Unions

• Maintenance of Industrial Peace

• Continuous Feedback and Monitoring

• Professional Approach

NEED FOR INTEGRATED

SYSTEMS

• There is need for an integrated systems approach which

would emphasis a direct relationship between the

personnel management and industrial relations sub-

systems and objectives of the company. The day to day

individual and collective grievances negotiations with

unions at shop level is like an effective preventive

maintenance system which should be the principal

ingredient of any industrial policy.

NEED FOR INTEGRATED

SYSTEMS

• This in turn will determine the firm` s ability to handle

periodic and non- recurring crises, whether in the shape of

work stoppages, strikes or wage disputes. In a democracy,

there are and there have to be situations involving friction

and even conflict, but an enlightened manager and a

responsible union will work out systems to resolve such

situations and conflicts.

Key Concepts in IR

• Collective Bargaining

• The ILO Defines

• Voluntary negotiation between employers or

employers’ organizations and workers’

organizations, with a view to the regulation of terms

and conditions of employment by collective

agreements.

Strike

• Collective suspension of work, agreed upon by a

number of workers with the purpose of reaching a

certain end.

Lock-Out

• The temporary closing of a place of employment, or

the suspension of work, or the refusal by an

employer to continue to employ any number of

persons employed by him.» As per the industrial dispute act 1947

Recognition of Trade Union

• An organization have many registered trade unions

but the recognition of the union is decided by the

employer. The word recognition is not motioned in

the Trade Union Act 1926. Law is silent about it.

• But for healthy IR, employer should recognize TU

and negotiate with them