Contents

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Index
What is IR.
Executive Summary..
Problem Statement
1st Question-Answers
2nd Question-Answers...
3rd Question-Answers...
4th Question-Answers
5th Question-Answers
References.

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What is Industrial Relations?

The way the employer and employee feel and behave towards each other or the way
they interact each other.
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What is industrial relations from a Worker's Perspective?

As workers, we associate Industrial Relations with Unions, Industrial Awards, and

labor laws that set the conditions under which we work. This includes our pay, safety,
employment security and opportunities for training. 150 years ago people worked 6
days a week, 12 hours a day or more, and there were no provisions for sick pay or
holiday pay. There was no protection for children who were often a form of cheap
labor, or worse, were sold into slavery. As a society we have come a long way since,
and this is largely due to the formation and actions of=- p[-njsmd,labor unions

What is industrial relations from a Society Perspective?

Whether we have good jobs and how we work has a fundamental effect on
the quality of our lives. Unemployment causes social isolation and economic
deprivation. When there is high levels of unemployment, there is social
tension and upheaval. Too much employment has its own set of woes.
People who work long hours often suffer from health issues and family
problems. There is a need to strike a work-life balance to ensure a healthy,
happy and productive populations.
What is industrial relations from a Government Perspective?
Industrial relations is a major factor in managing the economy. As a nation we compete in
the global marketplace for goods and services. If the workforce is inefficient and wage
demands are too high, then the cost of our goods and services is greater and consequently
we are less competitive in the global marketplace (. Governments create laws and policies
that affect Industrial Relations and thereby influence the pay and conditions of work for
workers.

Industrial Relation System

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Executive Summary
Bolts & Nuts is a company manufacturing and marketing bolts and nuts, this
manufacture had a fair share of the market in the said product during when there was
close economy with restriction of import such items. The company has the largest
market share and highest profit 300 of employees is working in the factory. Transition
from closed economic system to an open economic system invariably it has faced
many of problems.

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This made marketing getting flooded with imported good including bolts and nuts of
better quality at lesser price. This company cannot fulfill the demand because of the
policy change of the government and the company fails to take any significant step to
improve the quality of their goods and found plant and machinery which were old
twenty thirty years. Company always advice to employees to increase the product.
Then many of problems had faced by the company. company lost day by day then
worker are take trade union actions, as cost reduction method the y trying to terminate
the emplacement and re locate the factory, because of the environmental authority
compelled existing place is not suitable for company because waste water and other
waste. Trade union is come to collective agreement with man agent about the working
conditions. Again change the government and workers are joining to another trade
union.
From analyses these issues it is problem for the company when the doing there
production in the new located place. As solutions introduces. Create legal framework,
Introduce production base incentives for machine operators and improve the
productivity and motivate workers, Improve the quality of machinery and the
production, Use effective method for reduce labor cost ,Compliance with legal
requirements and do feasibility study for factory, Manage termination interview
effectively, conducted PESTEL analysis. It also shows the complicated and complex
issues that are involved in such a transition especially in terms of Industrial Relation
and how to cope with the problems that emerge as a result of such conflicts
From these solutions recommendations and the duties of HR managers in the
industrial relations are mentioned for the survival of the company.

Problem Statement
In this case study bolts company manufacturing and marketing bolts and nuts this
manufacture had a fair share of the market during the time when there was a close
economy with restriction of the import of such items, the company enjoyed a larger
market and was profit making successful organization. Around 300 employees
working in the factory again the government change and open economy was came
and many of problems has face by the company

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the demand of the product is increase and the poor machinery handling and the old
machinery is using the production of the company cannot improve and also
management is always influence and advice for the employees and the many of
workers are demotivate and many of trade union actions are arising and there was
legal problems are identified and these situations are came to stop the business,

Questions:
1. Evaluate critically the above facts and try to find out what exactly the
cause for this unfortunate situation.
1) The cause for this unfortunate situation is that the company did not have a
strategic planning. They did not anticipate the change of the economic
policy of the new government.
2) Closed economy with restriction of the important such items.
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The closed economy they had good market share and before the open
economy introduce.
3) Transformation in the economic policy of the country.
Chang in to the closed economy to open economy the company cannot
adapt

to the new changes. Cost. Laws. No production improvements,

then they gradually lost their market. Because the imported goods are less
price and good quality
4) They did not have a proper understanding about the changing environment
and also they did not anticipate to change according to the future
environmental changes.
5) The company was always of the opinion that labor was not giving the
maximum production and was thinking of ways and means of getting a
higher production from the labor.
6) No proper HR practices were followed. Grievances handling was not done
in a proper manner. They did not listen to their employees and had very
poor industrial relations. All these together resulted in the unfortunate
situation of the company. There was no good relationship between the
employer and the employee.
7) Taking disciplinary action for machine operators.
The company always advice to the employees. In this time the workforce
was content and the machine operators had fallen into a state of not
giving their best, then the disciplinary action was taken.
8) Workers constantly fought for their higher wages, incentives, and bonus
more OT etc
9) They did not change according to the technological changes. If they had
invested on new machinery and technology they would have been able to
survive.
10) The company was not innovative, proactive and had very weak strategic
planning. They were resisting to change anything they had. They were not
willing to experiment
11) Trade union actions are arising.

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Most of the employees are members of the TU, then they demanding
higher

wages and they came with collective agreement. They did trade

union actions several strikes were happened.

12) The Human Resource Manager failed to understand the situation.
HR manager doesnt care about their strikes of the employees and the
termination of employees are mainly target.
13) Not compliance with the legal requirement
Accordingly the commissioner of labor in terms of provision in the
termination of the employment of workmen act No 45 of 1971
seeking approval to terminate all the employees it is illegal
Also the compensation that termination of the employment
payables to the 175 workman and exceed several millions
14) Environment authority compelled the company to adopt an alternative
system for diffusion of wastage and other waste, as existing system was
not environmentally suitable.
15) Changes about the government again and most of employees are left their
union and joined another unions.

2) Was there a way to avoid this situations?

The company ideally should've been proactive in the whole thing because prevention
is always better than cure. However, there were many reactive methods that could've
been used. If they still used it, the situation wouldn't have become this unfortunate.
When the government advocated a free economy and liberalized the import of foreign
goods, the company should've used a new technology in order to improve the quality
of the product.
1) Change leadership style.
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Provide the company with proper leaders. The managers who are
appointed as leaders should follow a leadership style that leads to
sustainability of the organization along with ability to change according to
the environment.
(2) Bargaining Rights
Bargaining rights refer to union recognition and the rights of individual
workers to join together and bargain for a change in policy and organization.
The employees should be facilitated in a method where they can speak up their
issues.

(3) Change strategy into improving quality

Just as the economic policy was changed and competition came in, the
company should've improved the quality of it's product to match
competitive products. They should've bought new machines and trained
the employees to use them even though purchasing new machines was
costly. If they made that investment then, by now they would've been back
in business and making thick margins.

(4) Involve employees in decision making

Employee involvement is creating an environment in which people have an impact on
decisions and actions that affect their jobs. Employee involvement is not the goal nor
is it a tool, as practiced in many organizations. The company should encourage the
employees to come up with new ideas and to involve in decision making. Employees
are the ones who are really in production; they would know what needs to improve in
order to make production more efficient

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(5) The employer should've had good HR practices and proper manpower planning
The company has shown very bad HR practices. Throughout, they have not done
proper human resource planning. The company has terminated the services of many of
its employees as disciplinary action. The company did not have good industrial
relations. The way they dealt with the trade union was not appropriate. They did not
look at a win-win situation when they entered into a collective agreement with the
trade union.
(6) Create legal framework
When the open economy is introduced the existing industries are in problem of adopt
to new changes as a government thy have to protect these industries and implement
industry protection programmed and implement good legal framework
Improve the quality of machinery and the production
Proper analysis for improve production and accordingly changes to the technology
should have been made to increase the efficiency of production
Introduce production base incentives for machine operators and improve the
productivity and motivate workers.
Production manager should could analyze the quality of the output and maintain a
standard of the products manufactured.
(9) Implement good disciplinary procedure
The company has been taken disciplinary actions because of the machine operators
are no increasing the productivity of the company it is not ethically good disciplinary
acting before doing this analyze what is actual reason and give solutions

(10) Strategically handle the trade union actions.

Company can find what are the reasons that employees are de motivated and
dissatisfied before going to trade union action then strategically handle these
problems
(11) Use effective method for reduce labor cost.
Most of time the HR manager try to reduce labor cost, then as termination the
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employees are in probation period or trainees, can terminate but casual

employee/permanent can terminate. Can introduce voluntary retirement scheme.
(12) Evaluate the relocation of the factory
Before relocate analyze and do feasibility study before failed again the re location
(13) Manage termination interview effectively
The company tries to terminate all the employees they seeking about that that is
illegal, then manage termination interview effectively
(14) Conduct PESTEL analysis
Political, Economic, social. Technological, Environmental. Legal this environment
analysis is more effect for business can get many advantages from analyzing PESTEL
(15) Human resource manager has listen to the employees
HR manager is not listen to the employees demands they doing strikes. He unable to
give to solutions for the employees problems, then change HR manager
(16) Give training for the worker to improve production
introduce new machines or the production and give training for the machine operators
and also for the collective agreement change of the government and many of
employees are join to another trade union and fro this collective agreement company
can go labor courts for this agreement

3. Was there any reason for the poor industrial relations in the Bolts & Nuts
Co. Ltd

Hardened attitudes from poor pre-existing relationships.

Parties avoiding meaningful bargaining by refusing to discuss. Employing an

overly-aggressive or formalistic style of negotiation.

The change of government

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Change of the closed economy to the open economy the government hasnt
proper policy of handling industries, they never protect internal industries

from the foreign import industries.

Disrespectful and even outrageous behavior by negotiators.
Unrealistic expectations.
Incomplete information on issues being bargained.
Leadership issues.
Poor communications skills.
Proper Industrial conflict resolution model was not adapted
The Company hasnt use proper industrial conflict resolution model. So if they
have good procedures they able to minimize these disputes and minimize the

production cost.
Workers and management not seeing issues in the same manner.
Lack of trust or credibility.
Real decision-makers not being at the table, particularly in large multi-national

corporations.
Changes of work place and new workplace procedures (e.g. over discipline)

without meaningful discussion.

The management signed the collective agreement between the employers and
the employees only after it decided to cut labor cost by reducing the
workforce.
The collective agreement is signed and the change of the government again

employees are gathering with another TU take legal actions for that.
Not consider legal requirements.
When the termination of employees they try to terminate all employees and
recruit new employees for re-location and also the environmental concern
legal requirements are not consider.

The main aspects of Industrial Relations are:

I.
II.
III.
IV.
V.
VI.
VII.

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

Employer-employees relations, i.e. relations between management and
employees.
Group relations, i.e. relations between various groups of workmen.
Community or Public relations, i.e. relations between industry and society.
Promotions and development of healthy labor-managements relations.
Maintenance of industrial peace and avoidance of industrial strife
Development of true industrial Democracy.

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Poor industrial relations in Bolts & Nuts affected the company in a bad way. There
was a fall in normal tempo. Poor Industrial Relations adversely affect the normal tempo of
work so that work far below the optimum level. Costs build up. Absenteeism and labor
turnover increase. Plants discipline breaks down and both the quality and quality of
production suffer.

There was frustration and social cost. Employees come to the work place not only to
earn a living. They want to satisfy his social and egoistic needs also. When they find difficulty
in satisfying these needs they feel frustrated. Poor Industrial Relations takes a heavy toll in
terms of human frustration. They reduce cordiality and aggravate social tension.
The reasons for poor industrial relations probably were mainly because of the attitude of the
employer towards the employees. They didn't trust the employees and always believed that
the employees were not giving their best.

4. Can you point your finger at the HR Manager for this situation
There are many functions in an organization such as marketing, finance, Human
Resource management, production, IT etc. Out of these functions, the Human Resource
function is responsible for taking care of the employees. The Human Resource Manager
should take care of the following,

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Recruitment and selection

Training and development
Employee relations
Industrial Relations
Health, safety and welfare
Compensation
The HR manager of Bolts and Nuts has not been doing any of these in the right way.

It is true that the HR manager alone does not take strategic decisions of the company.
However, it was his responsibility to ensure that the voices of the employees were heard by
the top management. The HR manager is the link between the employees and the employer.
The collective bargaining process was a good opportunity for the company to set
things right at least to a certain extent. Unfortunately, the HR manager seems to have not had
proper training on how to deal with it. The collective agreement was signed though the
company was asking too much from the employees. The HR manager surely has had no
intention of standing up for the employees when his whole job is to protect them.
The HR manager also doesn't seem to have any knowledge about the legal aspects
connected to this. Normally in an organization, it is the HR manager who advices the top
management about employee laws. The company has made a huge mistake by terminating the
services of all employees while there was a complaint with the commissioner of labour. This
was something that they should've known. This cannot be taken as a mistake and no one can
excuse the HR manager for not knowing the law. Not all companies are covered by the TEWA
act. While an inquiry is going on for a matter, you cannot terminate employees. You need to
pay wages even if the employees are at home.
Taking all these into consideration, I would say that it is fair to point the finger at the
HR manager for this situation. And the HR manager should be blamed.

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5. Was there any way to resolve the crisis situation that arose in the
company?

Implement 7s frame work as a strategy

Machinery change the machinery with new technologically equipped

Produce quality product at low cost which could compete with imported
goods.

Create legal framework

Compliance with legal requirements and do feasibility study for factory

Manage termination interview effectively

Conduct PEST analysis

Human resource manager had listened to the employees

Proper industrial conflict resolution model

Provide training for the worker to improve production

Implement good disciplinary procedure

Improve the quality of machinery and the production

Proper analysis for improve production and accordingly changes to the

technology should have been made to increase the efficiency of

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production Employee feedback programs Establish a strong and productive

HR division

Production manager could analyze the quality of the output and maintain a
standard of the products manufacture

Introduce production base incentives for machine operators and improve the
productivity and motivate workers

Continuous review of HR practices, practices in the context of changing

internal and external environment.

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References

Amstrong.michael. A hand book of human resource management

practice, 9th edition, British library cataloging, and 2004

Hand outs in the PQHRM course at IPM

Greorge W. Bohlander Scott A.snell (Principle of Human Resource

th

management) 16 edition.

http://www.leoisaac.com/hrm/indrel01.htm

All images- http://www.google.com

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