01CH-03 1

Changing Profiles of Major Stakeholders of Industrial Relations in India
Trade Unions
1. Blue Collar-Workers' Trade Union
Trade Unionism grew as one of the most powerful socio-economic political
institutions of our time - to fill in the vacuum created by industrial revolution in the
industrial society. It came as a countervailing force to reconcile social and economic
aberrations created by Industrial Revolution.
FORMATIVE STAGES
 Trade Union had to pass through a very difficult and hostile period in the initial
years. The employers wanted to crush them with iron hands.
 Then came the period of agitation and occasional acceptance.
 When the union gained strength, they started confronting the employer. This is
the period of struggle which continued for long.
 Employers were forced to accommodate, tolerate and hesitatingly accept them.
 Then came the period of understanding collective bargaining in the industry. Cont….
Copyright © 2008, B D Singh
3-1 INDUSTRIAL RELATIONS Emerging Paradigms (2nd Edition) B D Singh Excel Books
DEFINITION
 Trade union is an association either of employees or employers or of
independent workers.
 It is relatively a permanent formation of workers. It is not a temporary or casual
combination of workers.
 It is formed for securing certain economic (like better wages, better working
and living conditions), and social (such as educational, recreational, medical,
respect for individual) benefits to members.
A more recent and non-legislative definition of a union is:
"An organisation of workers acting collectively, who seek to protect and promote
their mutual interests through collective bargaining".
De Cenzo and Robbins (1993)
Cont….
FORMS OF TRADE UNIONS

1. Classical: A trade union's main objective is to collectively protect the interests
of its members in a given socio-economic-political system.
2. Neo-classical: It goes beyond the classical objectives and tries to improve
other wider issues like tax-reliefs, raising saving rates, etc.
3. Revolutionary change in the system: Establishing the rule of working class
even through violence, use of force, etc.
Functions of Trade Unions
a) Militant or protective or intra-mutual functions
b) Fraternal or extramural functions
c) Political functions
d) Social functions
Cont….
Objectives of Trade Unions
a) Wages and Salaries
b) Working conditions
c) Discipline
d) Personnel policies
e) Welfare
f) Employee-employer relations
g) Negotiating machinery
h) Safeguarding organisational health and the interest of the industry
Cont….
CLASSIFICATION OF TRADE UNIONS

Classification based on ideology
 Revolutionary Unions: Believe in destruction of existing social/economic
order.
 Reformist or Welfare Unions: Work for changes and reforms within the
existing socio-political framework of the society - European Model.
 Uplift Unions: They advocate extensive reforms well beyond the area of
working condition.
Classification Based on Trade
 Many unions have memberships and jurisdictions based on the trades they
represent. The most narrow in membership is the craft union, which represents
only members certified in a given craft or trade, such as pipe fitting, carpentry
and clerical work.
 At the other extreme, in terms of the range of workers represented in the
general union, which has members drawn from all trades. Most unions in India
Cont….
and Sri Lanka are in this category. Copyright © 2008, B D Singh
Classification Based on Agreement

 Closed Shop
 Union Shop
Cont….
Some of the typical Joint Committees are:

1. Compensation Committee
2. Welfare Committee
3. Canteen Management Committee
4. Transport Management Committee
5. Sports and Entertainment Committee
6. Employee of the Month Committee
7. Suggestion Committee
8. Employees Health Safety and Environment Management Committee
9. Good House Keeping Committee
10. Grievance Committee
Cont….
TRADE UNION ACT, 1926
The Trade Union Act 1926 legalises the formation of trade unions by allowing
employees to form trade union. It allows trade union to get registered under the Act.
Registration provides legal status to the trade union and it becomes body corporate.
It can hold moveable and immoveable property and can enter into contract and can
sue and can be sued. The Act also provides immunities to the unions from civil and
criminal prosecution for bona fide trade union activities. The Union can generate
General Fund for the day-to-day activities and Political Fund for political activities
(For details - Refer Act).
Cont….
RECOGNITION OF TRADE UNION
The underlying idea of forming a trade union is to negotiate and bargain with
employers to improve the service and employment conditions of workers on their
behalf. This collective bargaining process can be possible only when the employer
recognises the trade union as a bargaining agent and agrees to negotiate with it
because it is difficult to negotiate with multiple trade unions in a single organisation.
The Trade Union Act 1926, is the only Central Law, which regulates the working of
the unions and does not have any provision for recognition of trade unions. Some
attempts were made to include compulsory recognition in the Trade Union Act of
1947, 1950, 1978 and 1988, but these did not get materialised.
Cont….
RIGHTS OF RECOGNISED UNIONS

a) the right to raise issues with the management,
b) right to collect membership fees within the premises of the organisation,
c) ability to demand check-off facility,
d) ability to put up a noticeboard on the premises for union announcements,
e) ability to hold discussions with employees at a suitable place within the
premises
f) right to discuss members' grievances with the employer,
g) ability to inspect beforehand a place of employment or work of its members,
and
h) nomination of its representatives on committees formed by the management for
industrial relations purposes as well as in statutory bipartite committees.
Cont….
PROBLEMS CONFRONTING UNIONS AND MEASURES TO STRENGTHEN

TRADE UNION MOVEMENT IN INDIA
 Trade Union Leadership
 Reasons for Emergence of outside Leadership
 The Evil Effects of outside Leadership
 Multiple Unions
 Union Rivalry
 Finance
 Other Problems
1. Illiteracy
2. Uneven growth
3. Low membership
4. Heterogeneous nature of labour
5. Lack of Interest
6. Absence of paid office-bearers
Cont….
Measures to strengthen Trade Union Movement in India

The following are some of the measures to minimise trade union problems and to
strengthen the Trade Union Movement of India.
 United Labour Front
 Efficient Leadership
 Membership Fees
 Other Measures
BUILDING RESPONSIVE TRADE UNIONISM
i. Inactive – Indifferent, none of their business' posture.
ii. Reactive – Violent reaction, blocking, rejecting, coercing, striking.
iii. Responsive – Addressing, supporting, adopting.
iv. Proactive – Agent/catalyst of change.
v. Partnering – Responsible, taking risks along with employers. Cont….
STRATEGY FOR BUILDING RESPONSIBLE TRADE UNIONISM

1. Micro to macro focus
2. Bargaining to sharing
3. Grooming trade union leadership
4. Conflict to collaboration
5. Developmental role
6. Enhancing union influence
7. Protective regulation to self-sustenance
8. Openness and transparency
9. Effective utilisation of alternative forums
10. ACCEPT, SHARE and GROW
Cont….
FEMALE WORKERS and TRADE UNIONS
Female workers in India are mostly employed in the organized sector. Therefore,
the trade unions, which initially represented mostly organized workmen, did not pay
much attention to female labour. It is only recently that some national trade union
centers in India have announced that if their affiliates send nominations for
representation at various decision-making levels in the union hierarchy without a
woman member in the panel, they will not consider the panel.
Union membership and union leadership amongst women is higher in some

occupations than in others. In the garment industry, the proportion of women to the
total members could be about 70%. In plantations, hospitals, hotels,
telecommunication, public service, and anganwadis, women occupy positions as
joint secretary/secretary. In teaching and nursing they hold even higher positions.
Cont….
Why Women Do Not Join Unions

1. Family responsibilities-childcare, all household duties-are left mainly to women.
2. Religion, taboos, and cultural inhibitions make it difficult for women to break
into male environments.
3. In the workplace, women are often employed in subordinate positions under
the supervision of men in more powerful positions. The occupational segregation
in union structures create barriers for women's advancement.
4. Trade unions are often male dominated because of
• The notion that working in the union is a 24 hours a day job,
• The tendency to hold meetings at night,
• Union jargon and sexist language,
• Informal male structure(old-boys network),
• Less interest in women's issues,
• Less access to education and training for women in many places, Cont….
White-collar Trade Unions

There was a time when unions and strikes were known only to blue-collar workers in
factories, mines, railways docks, etc. White-collar employees and professional
people like doctors, engineers, lawyers, professors and senior executives and
managerial staffs thought it below their dignity to band themselves in unions, march
the high streets and yell slogans. Today, it is different. Trade unions exist among
most professionals, white-collar employees, officers, senior executives and
managers, and so do strikes and gheraos.
Cont….
WHITE-COLLAR WORKERS AND BLUE-COLLAR WORKERS

Differences between Blue and White-Collar Workers
S.No. Blue-Collar Worker White Collar Worker
1. All shop-floor workers (Part of the production All clerical or office staff who do notwork on the
team who operate machines and related shop floor, are termed as white -collar workers
systems) are termed as blue -collar workers, as their work and working places are clean.
as their work is not generally clean. They are generally involved in a desk job or
providing service over the counter.
2. They are manual workers with lower literacy They are non-manual workers forming a distinct
and education and have their own social and social ground, characterised by divergent socio-
economic background. economic backgrounds, level of education,
manner of speech, social custom and ideology.
They are better educated and ha ve jobs
requiring mental capabilities to a greater extent.
3. They may be paid by time, or by piece, or They are time -workers paid on monthly basis.
results, either on daily, or weekly, or They enjoy longer holidays and leave facilities
fortnightly, or monthly basis. They are and better privileges.
generally wage earners, and may have lesser
holidays, and leave facilit ies and other
privileges than white-collar workers.
4. They are not so inclined towards They hold such jobs that they are regarded as
management. On the other hand, they may be part of the management, and so they are more
caring f or their unions than for the inclined towards it than the blue-collar workers.
management. Cont….
5. Excepting highly skilled categories who are in Because of their professional and social
greater demand and can manage to have standing they are generally better paid and
higher wages in income, the blue -collar have better terms and conditions of
workers are not so well paid. employment, including better perquisites and
Their fringe benefits and perquisites are lower fringe benefits.
than those of white-collar workers.
6 They have better union protection and job They have no union protection if they are not
security by labour legislation, such as unionised, and also job security if they are not
Industrial Disputes Act. covered by the Industrial Disputes Act, 1947 as
may be the case with a few of them.
7 They are mostly engaged in production They are concentrated in the fields of
processes. commerce, transport, storage and
communication. They are engaged in different
occupations that fall under the category of
professional, administrative, executive and
managerial workers, clerical and related
workers, sales staff, technical and supervisory
and other workers, engaged in transp ort and
communication services, or in sports and
recreational facilities, artists and musicians.
8 They have no authority, nor are they They are linked with their employers by being
associated with decision–taking. associated with that part of the product ive
process where authority is exercised and
decisions are taken.
Cont….
Why White-Collar Workers' Unions?

The growth of white-collar unionism are:
1. Denial of both, job security and social security to them by their exclusion from
the purview of labour laws like Industrial Disputes Act, 1947.
2. Anomalies in pay caused by implementation of the recommendations of Wage
Boards and Pay Commissions.
3. Inconsistent and discriminatory promotion and salary policies which have been
causing so many conflicts and disputes.
4. Gradual narrowing of wages and salary differentials of blue and white-collar
workers due to fast improvement in the wages.
5. Inflation and soaring prices resulting in erosion of pay and standard of living of
white-collar workers and, thus, leading to demand for higher pay, dearness
allowance and annual bonus and other fringe benefits.
Cont….
DISTINGUISHING FEATURES OF WHITE-COLLAR UNIONS

i. White and Blue collar workers' unions are mostly registered under the Trade
Unions Act, 1926 and are generally known as Workers and Employees' Unions.
ii. Members of white-collar unions are more educated, knowledgeable and
intelligent and, therefore, they are more capable in negotiating and bargaining for
their demands. Their union leadership is, therefore, mostly internal or
endogenous. As blue-collar workers are largely illiterate or less educated.
iii. Financially and membership-wise, white-collar unions are stronger than blue-
collar unions.
iv. White-collar unions suffer much less from multiplicity, politicalisation and
outside leadership and, consequently, from inter-union rivalries than the blue-
collar unions.
v. Lastly, some of the white-collar employees may be outside the purview of the
Industrial Disputes Act, 1947, and so may have the problem of job security
which their unions may have to look after. This may not be the problem with
Blue-collar Unions almost all their members are covered by the I.D. Act, 1947.
MANAGERIAL ASSOCIATION
GROWTH AND ACTIVITIES
The phenomenon of managerial unionism is now a fact. It is growing and multiplying.
Managerial Officers' Unions in industrial and commercial establishments, both, in public and
private sectors have now come to stay.
STATUTORY PROTECTION
The Constitution grants the right to organise, and so nobody including the manager and
officer, can be prevented from forming or joining any organisation, if he so desires. The Trade
Unions Act, 1926 and the Societies Registration Act, 1860 which provide the only legal
framework for the managerial and officers' unions, permit the registration of unions and
associations formed by any seven workers/persons. The registered trade unions are protected
from civil and criminal proceedings for bona fide trade union activities, including peaceful strike
and picketing. The Trade Unions Act provides only for the right to organise, but not the right to
bargain collectively, as there is no provision in the Act for the recognition of unions by the
employers.
Employers' Associations
Employers' Organisations (EOs) are "formal groups of employers set up to defend,
represent or advise affiliated employers and to strengthen their position in society at
large with respect to labour matters as distinct from economic matters. They may
conclude collective agreements but this is not a formal rule and cannot be an
element of their definition. Unlike trade unions, which are composed of individual
persons, employers' organisations are composed of enterprises. Most legal
definitions of a trade union apply to them (Oechslin, 1990). The Trade Union Act,
1926 includes in its purview, both associations of workers as well as employers.
Employers' Associations came into existence as a result of the formation of ILO and
the growing presence of Trade Unions, especially after the First World War.
Cont….
Objectives
Primary
a) Promote and protect the interests of employers engaged in industry, trade and
commerce in India.
b) Study, analyse and disseminate information relating to labour policy, labour-
management relations, collective bargaining, etc.
c) Offer advice concerning various aspects of labour policy.
d) Liaise with Union Government and initiate steps that are representative and
legislative in nature.
Secondary
a) Train and develop staff and members.
b) Obtain data on wages and conditions of work in industries attached to them.
c) Take up projects for social and family welfare.
d) Initiate steps to improve public image and improve public relations.
Cont….
ORIGIN AND GROWTH

The origin, growth and development of EOs in India have three distinct phases: (i)
the period upto 1933 (ii) the period between 1933 and 1946; and, the post-
independence period. Each phase reveals its own structural and functional
characteristics. In each phase, the organisations had to undergo changes because
of contemporary economic, social and political developments. The changes have
been more rapid in some areas than in others. The periods referred to also
coincided with important developments in the labour field and these have had a
great impact on the pattern and development of EOs and also on their functioning.
Structure
a) Local organisations
b) Regional organisations
c) Central organisations
AIOE: The All India Organisation of Employers
EFI: The Employers' Federation of India
IOE: The International Organisation of Employers
Cont…. Copyright © 2008, B D Singh
AIMS AND OBJECTIVES OF EOS

AIOE: The principal objective of the AIOE is said to educate employers as to how
best they could maintain harmonious industrial relations.
EFI: The main objectives of the EFI as embodied in its constitution are: (i) to
regulate the relations between employers and workers; (ii) to promote and protect
the legitimate interest of employers engaged in industries, trade and commerce;
New Roles of Eos
1. Lobbying/awareness creation
2. Training consultancy services
3. Referral services/database service
4. Information dissemination/publication/experience sharing
5. Relations with social partners and other stakeholders
6. Legal advice/assistance
7. Collective bargaining
8. Social service
9. Other service, if any as per exigencies
Cont….
LEGAL STATUS
EOs could be registered in any of the following legal forms: The Trade Unions Act,
1926; the Indian Companies Act, 1956; or the Societies Act, 1860. The AIOE
remained a registered body till 1969 when it was registered under the Indian Trade
Union Act. The EFI came into being in March 1933 as a company under the Indian
Union Act. A quarter century later, it was reorganised as an unregistered
Association, a position which continued till 1963 when it too was registered under
the Indian Trade Union Act.
AMALGAMATION OF EOS
During the pre-independence era, industry, trade and employer associations were
divided on the basis of Swadeshi vs Foreign, large vs. small, and to an extent on
regional basis. After independence, the indigenous private industrialists began to
train their guns against public sector which had witnessed a rapid growth (at least
until 1990s when privatisation was becoming the "in-thing").
Cont….
COUNCIL OF INDIAN EMPLOYERS (CIE)

The main object in setting up the CIE was to ensure closer cooperation and
coordination between the two bodies which together represent particularly the
interests of large-scale industry in India. In the year 1973, the SCOPE joined the
CIE.
INTERNATIONAL ORGANISATION OF EMPLOYERS (IOE)
Founded in 1920, the International Organisation of Employers with headquarters in
Geneva is the only world organisation authoritatively representing the interests of
employers of the free world in all social and labour matters at the international level.
As of June 1992, it has a membership of EOs in 104 countries.
ORGANISATION AND MANAGEMENT OF EOs IN INDIA
 Membership
 Organisation Structure
 Finances
 Representation
 Services
Cont….
 Relations Copyright © 2008, B D Singh
FUTURE CHALLENGES
EOs reflect on the emerging challenges and redefine their role in a rapidly changing
scenario. For instance, the spread of democracy and the transition to free market
economy in most countries the world over rendered old notions of ideological class
conflict that are less relevant today. With the gradual shift towards information
technology, the society requires reorientation in the basic philosophy of human
resource management policies. Technological, structural, economic and other
changes require adaption and adjustment with a "human face". These, then, are
some of the new opportunities and challenges for EOs.
EVALUATION
Employers' Associations (EAs) have remained disparate groups, passing
resolutions and airing grievances from various platforms. EAs relations with
Government have remained individualistic in nature. They were keen to have
personalised relations with Government functionaries instead of presenting an
unified stand for the common benefit of all constituent groups. The relations with
unions were also far from satisfactory.
Government Policies and Industrial Relations

In the initial years of Industrial Revolution, Government followed the policy of
Laissez faire (non-interference) in settling Employers' and Workers' problems.
Parties were left free to settle scores the way they liked. Towards the end of the
19th century, the change was witnessed in the attitude of the Government. It was
constrained to intervene and bring protective legislations because of the following
reasons:
 Pressure from ILO
 Pressure from T.U. Movements.
 Gandhian philosophy of trusteeship
 Pressure from Constitutional obligations to fulfil “Pledges” and “Promises” as
enshrined in the Preamble, Fundamental Rights and Directive Principles of
State Policies.
 Government emerged as the biggest employer.
Cont….
ROLE OF THE STATE IN INDUSTRIAL RELATIONS
As the National Commission on Labour (1969) observed, "The concern of the State
in labour matters emanates as much from its obligations to safeguard the interests
of workers and employers, as to ensure to the community, the availability of their
joint product/service at a reasonable price. The extent of its involvement in the
process is determined by the level of social and economic advancement, while the
mode of intervention gets patterned in conformity with the political system obtaining
in the country and the social and cultural traditions of its people."
Cont….
CONSTITUTION AND LABOUR POLICIES
The preamble to the Constitution of India provides the framework within which the
labour policies of the organisation can be formulated in India:
"We, the people of India, having solemnly resolved to constitute into a sovereign
socialist secular democratic republic and to secure to all its citizens;
JUSTICE, social, economic and political;
LIBERTY of thought, expression, belief, faith and worship;
EQUALITY of status and of opportunity; and to promote them among all,
FRATERNITY assuring the dignity of the individual and the unity and integrity of the
Nation"
Cont….
Evolution of labour policy during the five year plans

A major landmark event influencing post-independence era labour policies was the
report of the Labour Investigation Committee, 1946. The National Government in
1946 drew up a four-year phased programme to:
a) revise the existing labour legislations to meet the changing needs of the time;
b) eliminate completely and/or control contract labour;
c) extend employment opportunities/exchanges to cover all classes of workers;
d) evolve fair terms of service and deal for workers;
e) fix wages in sweated industries, rationalise rate of dearness allowance to
promote fair wage agreement; and
f) lay down nucleus for an industrial health insurance programme.
Cont….
TRIPARTITE CONSULTATIONS
Recognising the need for tripartite consultation on labour matters on the pattern of
the International Labour Organisation and in line with the recommendations of the
Royal Commission on Labour, the Government has constituted in 1942, the Indian
Labour Conference (ILC) and the Standing labour conference (SLC) with a view to:
a) promote uniformity in labour legislation;
b) lay down a procedure for the settlement of industrial disputes; and
c) discuss all matters of all-India importance as between employers and
employees.
Both the ILC and the SLC were constituted on the lines of the composition of
the ILO:
a) equality of representation between the government and non-Government
representatives;
b) parity between employers and workers;
c) nomination of representatives of organised employer and labour being left to
the concerned organisations;
d) representation of certain interests (unorganised employers and unorganised
workers), where necessary. Cont…. Copyright © 2008, B D Singh
PARADIGM SHIFT IN INDUSTRIAL RELATIONS POLICY OF GOVERNMENT OF

INDIA
 Keeping in view the emerging economic scenario, government policies should
make a paradigm shift from regulation, protection and control to enabling,
facilitating and protecting – from dispute resolution to social and economic
development.
 There should be a gradual decline in the role of the state – not too much and
too frequent interventions.
 There should be a shift in industrial relation-information sharing, consultation,
communication, transparency and consensus development at all levels.
 The state should broad-base their labour policies and labour legislations to
cover unorganised sectors in a big way.
 The state should address the problems of diverse labour force-female worker,
bonded labour, child labour, unorganised labour and migrant labour from India
and abroad.
Cont….
STATE GOVERNMENTS AND INDUSTRIAL RELATION

Labour is in the Concurrent List of the Constitution. According to Article 246 of the
Constitution of India, both, the Parliament and State Legislatures can enact laws on
aspects relating to employment, trade unions, industrial disputes, social security etc.
Generally speaking, the State Government is the appropriate authority for
administering Central Laws in most cases.
 Different Practices at State Level
 Changes in Labour Law/Policy at the State Level
 Recognition of Bargaining Agent
 Simplified Labour Inspection
 New Thrust in Labour Policy
 Permissions for Closure, Retrenchment, and Lay-off
 Wages Cont….

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Changing Profiles of Major Stakeholders of Industrial Relations in India

FORMS OF TRADE UNIONS

Objectives of Trade Unions

a) Wages and Salaries

h) Safeguarding organisational health and the interest of the industry

CLASSIFICATION OF TRADE UNIONS

Classification Based on Agreement

Some of the typical Joint Committees are:

TRADE UNION ACT, 1926

RECOGNITION OF TRADE UNION

RIGHTS OF RECOGNISED UNIONS

PROBLEMS CONFRONTING UNIONS AND MEASURES TO STRENGTHEN

Measures to strengthen Trade Union Movement in India

STRATEGY FOR BUILDING RESPONSIBLE TRADE UNIONISM

FEMALE WORKERS and TRADE UNIONS

Union membership and union leadership amongst women is higher in some

Why Women Do Not Join Unions

White-collar Trade Unions

WHITE-COLLAR WORKERS AND BLUE-COLLAR WORKERS

Why White-Collar Workers' Unions?

DISTINGUISHING FEATURES OF WHITE-COLLAR UNIONS

Copyright © 2008, B D Singh

Copyright © 2008, B D Singh

ORIGIN AND GROWTH

AIMS AND OBJECTIVES OF EOS

COUNCIL OF INDIAN EMPLOYERS (CIE)

Government Policies and Industrial Relations

ROLE OF THE STATE IN INDUSTRIAL RELATIONS

CONSTITUTION AND LABOUR POLICIES

JUSTICE, social, economic and political;

LIBERTY of thought, expression, belief, faith and worship;

EQUALITY of status and of opportunity; and to promote them among all,

Evolution of labour policy during the five year plans

PARADIGM SHIFT IN INDUSTRIAL RELATIONS POLICY OF GOVERNMENT OF

STATE GOVERNMENTS AND INDUSTRIAL RELATION

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