s the skill levels and educational qualifications of employees advance,

the role and significance of trade unions tend to diminish. This is

because (a) employees are able to represent their own case and (b)
managements are more sensitive to the needs of individual employees,
whose intellectual skills become almost uniquely valuable.
This is already happening in the sunrise industries based on
brainpower such as IT and telecommunications. Another phenomenon
in these modern industries is that employees have greater opportunity
and tendency to move from one company to another, not only because
of better terms of employment but also because of their yearning to
learn new skills.
This appetite for learning is something remarkable, especially in the IT
industry. In fact, people in that industry are more bothered about what
they can learn in a company than about how much they earn.
This phenomenon is facilitated by the fact that there are plenty of
employment opportunities in IT and it is a young industry. That is why
one does not notice any union flags in the Silicon Valley of
India/Bangalore's Electronic City.
Trade unions have declined in their importance even in the UK, the
original home of trade unions. The UK's Labour Party was formed by
socialist leaders of trade unions.
Today, Tony Blair does not have to depend on trade unions as much as
his predecessors had to do in the 1980s and 90s. The Labour Party's
appeal to the public is based on key policy issues such as spending on
the National Health Service and the education system, rather than
anything to do with labour policy.
In the US, trade unions are powerful in negotiations with individual
employers, but have no significant political clout although they
generally support the Democratic Party.
The same is the case in Japan. Even in Germany, France, and Italy, the
role of trade unions has become more focused on negotiations with
employers rather than on politics.

The privatisation or corporatisation of many public services such as

electricity and water supply has accelerated this shift. Hopefully the
same shift in the character and role of trade unions will happen in
India -- even in places like Kerala and Bengal, as employment starts to
move to more intellect-based activities and public sector industries are
privatised.
Responsible trade union leaders with a long-term vision will adapt
their policies to suit the new realities.
Correspondingly, there has also been a change in the attitude of
management, even in family-managed companies. They are now better
educated and many of them have been exposed to international
education and international markets.
They realise the dignity of human beings more than their previous
generation and therefore are less prone to treat employees in a scurvy
manner. More and more companies are investing in management
training and development.
This has also helped to create much better awareness of the
aspirations of workmen, among the managers.
Yet the last vestiges of negative union practices continue to persist in
monopolistic public services like the state transport undertakings,
state electricity boards, etc.
The only way to correct this is to corporatise or privatise these
undertakings or open them up to competition. A prime example of the
change that is possible is what has happened in aviation.
Once airline services were opened up to competition, the whole scene
changed. Instead of treating passengers with the indifference typical of
a public sector employee, Indian Airlines staff learnt even to smile
while greeting passengers.
In addition, we have created some world-class private carriers in the
domestic market who are now set to take wing on international routes.
Even the railways can be privatised.

The rail track in each region can be owned and operated by a

company, which then allows competing companies to run their trains
on these tracks. Similarly, there is no reason why urban bus services
cannot be made more efficient by opening them up to competition.
Today they are run as monopolies due to pressure from unionised
labour. For example, in Mumbai the urban bus service is crosssubsidised by BEST Electric Supply services.
The important point is that unionised labour accounts for only a small
portion of the total workforce. It should not stand in the way of
policies that generate employment for the larger group outside trade
union control. In the end, that is what will benefit everyone.

Trade unions must reinvent themselves to sustain their organisation in the years
ahead. Most important challenge for unions in the 21st century will be to shift from
the old strategy of confrontation and conflict and to one of cooperation and
collaboration. Education and human resource development activities which have
been often cleverly used by the management could be used by unions as effective
policy instruments to reduce the vulnerability of informal sector workers. Trade
unions in India, for example, could play an important role to re-train and rehabilitate
the large number of workforce who will be he required to be separated from the
Indian public sector enterprises and state establishments.