2015 – Solved Question Paper | Industrial Relation | Final Year – Masters of Commerce (M.Com) | Dibrugarh University

2015 – Solved Question Paper | Industrial Relation | Final Year – Masters of Commerce (M.Com) | Dibrugarh University



(Industrial Relation)

Full Marks: 80

The figures in the margin indicate full marks for the questions.

1(a) What are the importance and significance of industrial relation? Highlight its main objective. (8+8=16)

-> Industrial relations may be defined as the relations and interactions in the industry particularly between the labour and management as a result of their composite attitudes and approaches in regard to the management of the affairs of the industry, for the betterment of not only the management and the workers but also of the industry and the economy as a whole.

The term industrial relations explains the relationship between employees and management which stem directly or indirectly from union-employer relationship.

Industrial relation is the relation in the industry created by the diverse and complex attitudes and approaches of both management and workers in connection with the management of the industry.

The importance of industrial relation is as follows:

1. It establishes industrial democracy: Industrial relations means settling employees problems through collective bargaining , mutual cooperation and mutual agreement amongst the parties i.e., management and employees unions. This helps in establishing industrial democracy in the organization which motivates them to contribute their best to the growth and prosperity of the organization.

2. It contributes to economic growth and development: Good industrial relations lead to increased efficiency and hence higher productivity and income. This will result in economic development of the country.

3. It improves morale of the work force: Good industrial relations, built-in mutual cooperation and common agreed approach motivate one to contribute one’s best, result in higher productivity and hence income, give more job satisfaction and help improve the morale of the workers.

4. It ensures optimum use of scare resources: Good and harmonious industrial relations create a sense of belongingness and group-cohesiveness among workers, and also a congenial environment resulting in less industrial unrest, grievances and disputes. This will ensure optimum use of resources, both human and materials, eliminating all types of wastage.

5. It discourages unfair practices on the part of both management and unions: Industrial relations involve setting up a machinery to solve problems confronted by management and employees through mutual agreement to which both these parties are bound. This results in banning of the unfair practices being used by employers or trade unions.

6. It prompts enactment of sound labor legislation: Industrial relations necessitate passing of certain labor laws to protect and promote the welfare of labor and safeguard interests of all the parties against unfair means or practices.

7. It facilitates change: Good industrial relations help in improvement of cooperation, team work, performance and productivity and hence in taking full advantages of modern inventions, innovations and other scientific and technological advances. It helps the work force to adjust themselves to change easily and quickly

Objectives of IR:

The primary objective of industrial relations is to maintain and develop good and healthy relations between employees and employers or operatives and management. The same is sub- divided into other objectives.

Thus, the objectives of Industrial Relation are designed to:

1. Establish and foster sound relationship between workers and management by safeguarding their interests.

2. Avoid industrial conflicts and strikes by developing mutuality among the interests of concerned parties.

3. Keep, as far as possible, strikes, lockouts and gheraos at bay by enhancing the economic status of workers.

4. Provide an opportunity to the workers to participate in management and decision making process.

5. Raise productivity in the organisation to curb the employee turnover and absenteeism.

6. Avoid unnecessary interference of the government, as far as possible and practicable, in the matters of relationship between workers and management.

7. Establish and nurse industrial democracy based on labour partnership in the sharing of profits and of managerial decisions.

8. Socialise industrial activity by involving the government participation as an employer.

(b) Explain the pre- requisites of successful Industrial Relation Programme. (16)

-> Today’s professional industrial relations director, or by whatever title he is designated, no longer views his job as personalizing management, or that of a social worker in a factory, or a union buster, he looks upon his department as an adjunct to management supervision at all levels; he keeps other executives informed about new discoveries, programme trends and needs. At the same time, he provides efficient service in the operation of several centralized services.

A successful industrial relations programme reflects the personnel viewpoint, which is influenced by three main considerations:

· Individual thinking

· Policy awareness and

· Expected group reaction

Individualized thinking makes if imperative for the administrator to consider the entire situation in which the affected individual is placed. Policy awareness underscores the idea of the consistency of treatment and the precedent value of any decision which a management takes; while expected group reaction balances what we know of human nature in groups against an individual’s situation in the light of the policy that has been formulated and implemented. In all these different circumstances, reality demands that all the three aspects of the personnel viewpoint should be considered at once in terms of the past, the present and the future. This viewpoint is held at all the levels of management from the top to the bottom, from the top executives and staff to the line and supervisory personnel.

The basic requirements on which a successful industrial relations programme is based are:

1. Top Management Support: – Since industrial relations is a functional staff service, it must necessarily derive its authority from the line organization. This is ensured by providing that the industrial relations director should report to a top line authority to the president, chairman or vice president of an organization.

2. Sound Personnel Policies: – These constitute the business philosophy of an organization and guide it in arriving at its human relations decisions. The purpose of such policies is to decide, before any emergency arises, what shall be done about the large number of problems which crop up every day during the working of an organization. Policies can be successful only when they are followed at all the level of an enterprise, from top to bottom.

3. Adequate Practices should be developed by professionals: – In the field to assist in the implementation of the policies of an organization. A system of procedures is essential if intention is to be properly translated into action. The procedures and practices of an industrial relations department are the “tool of management” which enables a supervisor to keep ahead of his job that of the time-keeper, rate adjuster, grievance reporter and merit rater.

4. Detailed Supervisory Training : – To ensure the organizational policies and practices are properly implemented and carried into effect by the industrial relations staff, job supervisors should be trained thoroughly, so that they may convey to the employees the significance of those policies and practices. They should, moreover, be trained in leadership and in communications.

5. Follow-up of Results: – A constant review of an industrial relations programme is essential, so that existing practices may be properly evaluated and a check may be exercised on certain undesirable tendencies, should they manifest themselves. A follow up of labor turnover, absenteeism , departmental morale, employee grievances and suggestion; wage administration , etc. should be supplemented by continuous research to ensure that the policies that have been pursued are best fitted to company needs and employee satisfaction. Hints of problem areas may be found in exit interviews, in trade union demands and in management meetings, as well as in formal social sciences research .

An industrial relations system consists of the whole gamut of relationships between employees and employees and employers which are managed by the means of conflict and cooperation.

A sound industrial relations system is one in which relationships between management and employees (and their representatives) on the one hand, and between them and the State on the other, are more harmonious and cooperative than conflictual and creates an environment conducive to economic efficiency and the motivation , productivity and development of the employee and generates employee loyalty and mutual trust.

2(b) Discuss the objectives of workers’ education. What are the different techniques used for workers’ education? (16)

-> Workers’ education is a means of providing workers and their representatives with the training they need to play an effective role in the economic and social life of their societies. At the same time it can also make a significant contribution to the dissemination of information on the various aspects of the work of the International Labour Organization which affects the interest of workers.

Under the responsibility of the Bureau of Workers’ Activities (ACTRAV), an important labour education programme is delivered in all regions, as well as at the International. Training Centre of the ILO. The ACTRAV-Turin Programme responds to the training needs of workers’ organizations with the delivery of training courses, training materials, specific projects and advisory services. Some of the programme’s objectives are:

‱ strengthening the process of institution and capacity building of trade unions;

· increasing the capacity of trade unions to plan and deliver educational programmes in line with their educational policies;

· strengthening staff development within trade unions;

· developing human resource within workers’ organisations, particularly the staff serving those organisations;

· strengthening tripartism and social dialogue with the development of bipartite and tripartite courses;

· promoting gender mainstreaming in all the activities of trade unions;

· promoting the development of union networks with the support of information technology and the exchange of union practices and policies; and

· providing training to trade unions on ways and means to be better involved in the enforcement and development of ILO Standards and the ILO Declaration on Fundamental Principles and Rights at Work and its Follow-up.

The ILO Convention about education and training, the Human Resources Development Convention, 1975 (No. 142) provides that the ratifying State shall adopt and develop comprehensive and co-ordinated policies and programmes of vocational guidance and vocational training closely linked with employment, in particular through public employment services.

Purpose of Workers’ Education:

Worker’s education is essential not only for protection and promotion of the interests of the workers but also for the development of the nation itself. Importance of educating workers in matters likes workers participation in management, labour laws, safety etc. is bound to grow in days to come. While on one hand workers need to be educated about their legitimate rights, clarified of wrong notions so that they may not be misguided into taking wrong action. It is important that workers are made fully aware of their fundamental duties as citizens of the country. The objectives of worker’s education as recommended by Workers Education Review Committee and accepted by Government are:

1. To equip all section of workers, including rural workers for their intelligent participation in social and economic development of the nation in accordance with its declared objectives.

2. To develop among workers a greater understanding of the problems of their social and economic environment, their responsibilities towards family members, and their rights and obligations as citizens, as workers in industry, as members and official of their trade union.

3. To develop leadership from among the rank and file of workers themselves.

4. To develop strong, united and more responsible trade unions through more enlightened members and better trained officials.

5. To strengthen democratic processes and traditions in the Trade Union Movement.

6. To enable trade union themselves to take over ultimately the functions of Worker’s Education.

Techniques of Worker’s Education:-

The techniques adopted for worker’s education keeps on changing from one place to another. Hence I am presenting in front of you some of the techniques commonly adopted in some advanced regions:


The Workers’ Education Association is one of the pioneer association working hard for educating the workers in UK. The WEA is divided into nine regions in England (each matching a Government Office region), a Scottish Association and over 500 local branches. It creates and delivers about 14,000 courses each year in response to local need across England and Scotland, often in partnership with community groups and local charities. These courses provide learning opportunities for around 95,000 people per year, taught by over 3,000 professional tutors (most of whom work for the WEA part-time). These figures make the WEA the largest voluntary sector provider of adult education in Britain.

The WEA is a national charity and is supported by the Government through funding from the Learning and Skills Council in England, and in Scotland by the Scottish Executive and Local Authorities. It also receives fees from learners on many of its courses and is often successful in funding bids from government, lottery and other sources for educational projects in local communities around the country.

There are also Workers’ Educational Associations in Northern Ireland and in North and South Wales. Since 1992/3, these have been entirely separate organisations from the WEA National Association, which now operates only in England and Scotland.

Northern Ireland:-

The Workers’ Educational Association NI provides adult education in community and workplace settings. Its title is somewhat misleading as it provides education for all types. of people and in particular tries to reach out to those who missed out on learning first time round. It works mainly with those over 18.

Some background…

· It was set up in Belfast in 1910 and part of a wider network of WEAs, the first of which started in England in 1903.

· Today it operates across Northern Ireland and in the Border Counties in the Republic. It has around 6,500 learners in any given year.

Its courses are organized mainly in venues such as community halls, arts centres and training rooms in workplaces. In fact it can pretty much set up a course wherever and whenever a community group, voluntary organization, union or employer needs it.

The WEANI’s Vision is a prosperous, creative, and cohesive society where everyone is a learner. Its Mission is to make learning irresistible. Its values are:

‱ When it comes to learning no-one should be left behind. People learn best and create most when they are open to difference. Working collaboratively is second nature to the WEA Everyone receives a quality of service. Actively listening to learners is core to its business Innovation and risk taking is essential

The WEANI’s Vision, Mission and Values have shaped its Strategic Plan ‘Irresistible Learning’ which sets out its objectives up to 2009.

WEA London Region:-

WEA run a wide range of local courses all over London, from Basic Skills to Beethoven; from Community Interpreting to Contemporary Literature; from Digital Media to Dance; from E-learning and Egyptology to English as a Second Language, and from Health and Safety to Helping in Schools.

These courses all share common values:

Creating equality and opportunity, and challenging discrimination

Believing in people, communities and their potential to change through education

Putting the learner at the centre of everything one do.

Coleg Harlech WEA (North Wales):-

Workers’ Educational Association (North Wales) was established in 1925 as the North Wales District of the Workers’ Educational Association. On 1 April 1993 it became a separate charity in response to the new funding arrangements for further education in Wales, under the Further and Higher Education Act 1992 and on 1 August 2001 it merged with Coleg Harlech-a campus-based institution which shares the WEA’s ‘second chance’ ethos- to form Coleg Harlech Workers’ Educational Association (North Wales). The WEA in Wales is supported by DELLS (formerly ELWa), the funding arm of the Welsh Assembly Government.

WEA Australia:-

The WEA was established in NSW in 1913. Early work was patterned on the WEA in the UK. However, given the different demographic arrangements in Australia, and in the absence of other adult education providers, the WEA in Australia became a general adult education agency. In the 1980s, a range of other training providers started offering adult education and the WEA’s role has changed. The WEA has many clubs and societies including the WEA Film Study Group.

3(a) Examine the various causes of industrial disputes. Suggest measures to prevent industrial disputes.(8+8=16)

-> Causes of Industrial Disputes

The causes of industrial disputes are many and varied. The major ones related to wages, union rivalry, political interference, unfair labour practices, multiplicity of labour laws, economic slowdown and others.

Wage Demands

By far, the most important cause for disputes is related to wages. The demand for wages has never been fully met because of inflation and high cost of living. High inflation results in increased cost of living resulting in never-ending demands from unions.

Management and Unions have wage agreement generally valid for three years. Each new agreement is preceded by a prolonged battle between managements and unions, often resulting in strikes and lockouts. Agreement reached in one company will inspire unions in other plants in the locality, and make them pitch tents demanding similar rise in wages.
Closely related to wages are bonus, incentives, and other allowances. Of all these, wages have been a major issue of contention that leads to disputes.

Union Rivalry

Multiplicity of unions leads to inter-union rivalries. If one union agrees to a wage settlement, another union will oppose it. The consequence is never-ending disputes, as has been happening at the Singareni Collieries. The company had 445 strikes in 1990-91 resulting in a loss of production of 3.12 million tonnes and 34.19 lakh man-days. The reason is mainly union rivalry. One union or the other is always on strike and often the demands of rival unions on an issue are conflicting.

Multiplicity of unions poses peculiar problems to managers. One such problem relates to authenticity of memberships. Unions put up respective numbers of members in such a way that when added together the figure exceeds the total number of workers in the organisation. Another problem relates to the selection of a bargaining agent in the process of collective bargaining. Union rivalry leads to large-scale violence.

Political Interference

Major trade unions are affiliated to political parties. Political affiliation is not peculiar to our country alone. Even a cursory assessment of labour movements around the world would show that trade unions are, by their very nature, political, and that politicisation of labour is the rule rather than the exception.

What happens when unions get politicised? In the first place, distant ideological issues divide and fragment unions on party lines. When unions multiply, inter-union rivalry erupts and the consequences are too obvious. Second, inspired by their political ideologies, certain unions refuse to sign an agreement even if it is favourable to all the workers and thus these perpetual dissenters manage to keep the issue alive.

Third, every political party somehow engineers strikes to demonstrate its political strength. Invariably, the political party which is in power favours a union which is affiliated to it, and the result is end less disputes.

Unfair Labour Practices

Majority of disputes are management inspired. The following points 2 justify the assertion:

1. The management is generally not willing to talk over any disputes with the employees or the representatives, or refer it to ‘arbitration’ even when trade unions want it so, and this enrages the workers.

2. A management’s unwillingness to recognise a particular trade union and the dilatory tactics to which it resorts while verifying the representative character of any trade union have been a source of industrial strife.

Multiplicity of Labour Laws

Labour laws in our country, as in several other countries, have been enacted to create conditions for the protection of labour from unfair employment practices and to provide a legal framework within which Industrial Relations is to be regulated.

Labour legislation is regarded as the most dynamic institution. From a simple restraint on child labour in 1881, labour legislation in our country has become an important agency of the State for the regulation of working and living conditions of workers, as indicated by the rising number and variety of labour acts. This rapid development of labour legislation is an integral part of the modern social organisation.

Measures to prevent industrial disputes:-

1. Works Committees:

This Committee consists of representatives of workers and employers. Under the Industrial Disputes Act 1947, works committees exist in industrial establishments in which one hundred or more workmen are employed during the previous year. It consists of an equal number of representatives of workmen and employer.

It is the duty of the works committee to promote measures for securing and preserving amity and good relations between the employer and workmen. It also deals with certain matters viz., conditions of work, amenities, safety and accident prevention, educational and recreational activities, promotion of thrift and saving etc.

Works committees will not deal with the following items:

(i) Wages and allowance (ii) Bonus and profit sharing schemes (iii) Rationalisation and matters connected with fixation of workload (iv) Matters connected with the fixation of standard labour force (v) Programmes of planning and development (vi) Retrenchment and lay-off (vii) Victimisation for trade union activities (viii) Provident Fund, gratuity schemes and the retiring benefits (ix) Quantum of leave and national and festival holidays (x) Incentive schemes (xi) Housing facilities.

2. Conciliation Officers:

Conciliation Officers are appointed by the Government under the Industrial Disputes Act, 1947.

The duties of Conciliation officer are given below:

(i) He has to do everything for bringing a fair and amicable settlement of the dispute. In case of public utility service, he must hold conciliation proceedings in the prescribed manner.

(ii) He shall send a report to the government if the dispute is settled in the course of conciliation proceedings along with the memorandum of the settlement signed by the parties.

(iii) Where no settlement is reached, conciliation officer sends a report to the government setting forth the steps taken by him for ascertaining the facts, circumstances relating to dispute and the reasons on account of which settlement could not be reached. The report shall be submitted within 14 days of the commencement of the conciliation proceedings.

In India, government of Bombay first introduced Conciliation and Labour Officer in 1934 when the Bombay Trade Dispute Conciliation Act was passed.

3. Boards of Conciliation:

The Government can also appoint a Board of Conciliation for promoting settlement of industrial disputes. The chairman of the board is an independent person and other members (may be two or four) are to be equally represented by the parties to the dispute.

The duties of the board include:

(a) To investigate the dispute and all matters affecting the merits and do all things as it thinks fit for the purpose of inducing the parties to come to a fair and amicable settlement.

(b) A report has to be sent to the government by the board whether a dispute is settled or not within two months of the date on which the dispute was referred to it.

4. Court Of Enquiry:

The government may appoint a court of enquiry for enquiring into any industrial dispute. A court may consist of one person or more than one person in that case one of the persons will be the chairman. The court shall enquire into the matter and submit its report to the Government within a period of six months.

5. Labour Courts:

The government has set up Labour Courts for dealing with the matters specified in the Second Schedule of the Industrial Disputes Act 1947. These matters include:

(i) The propriety or legality of an order passed by an employer under the standing orders.

(ii) The application and interpretation of standing orders.

(iii) Discharge or dismissal of workmen including reinstatement, or grant or, relief to workmen wrongfully dismissed.

(iv) Withdrawal of any customary concession or privilege.

(v) Illegality or otherwise of a strike or lock-out, and

(vi) All matters other than those specified in the Third Schedule.

6. Industrial Tribunals:

A Tribunal is appointed by the Government for the adjudication of Industrial Disputes relating to any matter specified in the Third Schedule. These matters are given below:

(i) Wages including the period and mode of payment.

(ii) Compensatory and other allowances.

(iii) Hours of work and rest intervals.

(iv) Leave with wages and holidays.

(v) Bonus, profit sharing, provident fund and gratuity.

(vi) Shift working otherwise than in accordance with standing orders.

(vii) Classifications by grades.

(viii) Rules of discipline.

(ix) Rationalization.

(x) Retrenchment of workmen and closure of establishment.

(xi) Any other matter that may be prescribed.

The Industrial Tribunal consists of only one person who is appointed by the Government. He should either be a Judge of a High Court or District Judge for a period of not less than three years. It makes an award after hearing the parties to the dispute and the award is binding on them.

7. National Tribunal:

A National Tribunal is constituted by the Central Government for the adjudication of industrial disputes involving questions of national importance. A National Tribunal shall consist of one person only to be appointed by the Central Government. A person who is or has been a Judge of High Court or who has held the office of the Chairman or member of the Labour Appellate Tribunal is eligible for the appointment of this tribunal.

(b) Discuss the merits and demerits of Grievance Procedure. (16)

-> A grievance is when an employee feels they have been wronged in some way, enabling them to file a complaint with the company.

The wrongness can be of any type. Be it an unfair pay cheque, racial or sexual harassment, or even overload of work. The grievance is basically a formal complaint.

It consists of steps and procedures, with a few rules that the investigation party must follow before pitching their resolution. These processes usually vary from firm to firm, but they are generally specified in contracts and company policies.

Advantages of Grievance Procedures

The ability to file a grievance with the company is the right of every employee. It is necessary and not developing proper grievance procedures is a violation of the law – not to mention the ethical violations. Regardless, it has several advantages, a few of them are:

1. Familiar Procedure.
It is a very formal procedure. The investigative and solution strategies are predefined and easily accessible for the employee. This gives the complainant somewhat a definite idea of the steps the company will follow in response to their complaint.

2. Nothing Overlooked.
It is a well-detailed process, so there’s only a minor chance of missing any important details.

3. Take it in writing.
This is the fundamental of any business dealing – to have the agreement in writing. Similarly, the grievance procedure is well-documented and can be referred to in the future. This gives rise to another important advantage.

4. Awareness cannot be denied.
As it is a documented procedure, the company cannot claim that they were unaware of the complaint. For example, if there was a complaint of an employee being burdened with extra tasks, the company cannot get away by simply claiming: “Oh, we didn’t know they were overloaded”.

5. Transparent Procedure.
The processes followed for investigation and conclusion can be made quite transparent. This eliminates the chances of corruption or exploitation.

6. Lawyers ain’t cheap.
Some unions also allow the filer of complaint to be represented by a professional union representative or an attorney. As they don’t cost the complainant, it removes the hesitance within them to come forth with their problem.

Disadvantages of Grievance Procedures

As with every facility, the grievance has also a few disadvantages, in some cases, it can even be misused. Following are some of the disadvantages caused by grievance:

1. Hassle.
Sometimes, the procedure may seem “a bit too much hassle”. This might discourage employees from coming forth with complaints. Likewise, it may also discourage employers from acting upon a complaint unless it’s formally written down.

2. When will it be resolved?
As it is a detailed procedure, it can tend to become quite lengthy. This means it could be unnecessarily dragged until the final resolution. The main reason for this is to ensure all necessary procedures are followed down to the minute detail.

3. Too much paperwork and retardation of workflow.
It can halt workload and drench the company in a lot of paperwork. Furthermore, the procedure is a lengthy process involving the time of the investigation party while they cover their investigation. The people are also affected.

They can often find themselves in the middle of the investigation, complying with the requirements of the investigative party. They could have been working during this time.

4. Protection against retaliation.
This is a double-edged sword. The complainant has the freedom to come forth with their problem because the rules protect them from retaliation from the company. However, the person can also misuse it to drench drenching the company in a lot of paperwork and affecting workflow.

4(a) On what ground would you advocate workers’ participation in management? How far has this been successful in India? (10+6=16)

-> Workers’ Participation in Management Before Independence:

The workers’ participation in management is not a novel and imported idea from outside. It can be dated as far back as 1920 when Mahatma Gandhi suggested participation of workers in management on the ground that workers contributed labour and brains while shareholders contributed money to the enterprise and that both should, therefore, share in its property.

He said that there should be a perfect relationship of friendship and cooperation among them. For the unions, he said that the aim should be to raise the moral and intellectual height of labour and, thus, by sheer merit, make labour master of the means of production instead of the slave that it is. It was at his instance that, in 1920, the workers and the employers in Ahmedabad Textile Industry agreed to settle their disputes by joint discussions and consultations.

Therefore, the Ahmedabad Agreement may be regarded as a mile­stone in the history of joint consultation i.e. participative management in India. Following this, some works committees were also set up in the Government Printing Presses and Railways. During the same period, such committees were also set up in the Tata Iron and Steel Company, Jamshedpur. Since then, there is no looking back in this direction.

While supporting the need for works committees, the Royal Commission on Labour suggested that, to promoting industrial harmony and to avoid misunderstanding and settle disputes, not only works committees be set up, but strong trade unions be developed and labour officers be appointed.

Along with the works committee, the Commission also suggested the establishment of a joint machin­ery to deal with the more general questions, and also to act as an advisory appellate body in respect of disputes which were confined to a single establishment. These recommendations of the Commis­sion bore fruits with the provision of formal statutory machinery under the Bombay Industrial Rela­tions Act, 1946 and the Industrial Disputes Act, 1947.

Workers’ Participation in Management After Independence:

In fact, the first major step in the direction of workers’ participation in management in India was the enactment of the Industrial Disputes Act, 1947 with the dual purpose of prevention and settle­ment of industrial disputes. The Industrial Policy Resolution, 1948 advocated WPM by suggesting that labour should be in all matters concerning industrial production. Article 43 A of the Constitution of India has provided for WPM in these words:

“The State shall take steps, by suitable legislation, or in any other way, to secure the participa­tion of workers in management of undertakings, establishments or other organisations engaged in an industry”.

The First Five-Year Plan and the successive plans emphasised the need for workers’ participation in management. For example, the Second Five-Year Plan’ stressed the need for WPM in the following words:

“It is necessary in this context that the worker should be made to feel that in his own way he is helping build a progressive state. The creation of industrial democracy, therefore, is a prerequisite for the establishment of a socialist society”.

The Government of India set up a ‘Study Group on Workers’ Participation in Management’, in 1956, consisting of representatives of the government, employers, and workers to examine the system of WPM in the UK, Sweden, France, Belgium, West Germany and Yugoslavia and make recommendations for the Indian case.

The Group submitted its report in May 1957 with the following recommendations:

1. WPM schemes should be introduced in selected undertakings on a voluntary basis.

2. A sub-committee consisting of representatives of workers, employers and government should be set up for considering the WPM in India.

The above recommendations, among other things, were accepted by 15th Indian Labour Confer­ence held in July 1957. The Conference appointed a 12 member sub-committee to look into further details of the scheme. The recommendations made by the sub-committee were discussed in a “Seminar on Labour-Management Co-operation” held in New Delhi on January 31 and February 1, 1958. It drew up a “Draft Model Agreement” between labour and management for the establishment of the Joint Management Councils (JMCs) which would have the following three sets of functions:

First, to fulfill its functions as an advisory body.

Second, to receive information on certain matters.

Third, to fulfill administrative responsibilities.

Besides, the Seminar on Labour Management Co-operation also took the size of the Councils, its office bearers, term of office, etc. Thus, the Joint Management Councils (JMCs) were set up in 1958.

Following the recommendations of the Administrative Reforms Commission, the Government of India accepted the inclusion of the representatives of workers on the Board of Directors of public sector undertakings. Following this, the Nationalised Banks (Management and Miscellaneous Provi­sions) Scheme 1970 also provided for the appointment of worker director to their Board. One director was from among employees (who are workmen) and another from among officers for tenure of 3 years.

Thus up to July 1975, there had been three forms of workers’ participation in management intro­duced in India: Works Committees, Joint Management Councils and Workers-Directors (public sec­tor) on Boards of Directors.

Under the Government of India’s 20-Point Economic Programmes, a new scheme of shops and plants councils was introduced in 1975 after the emergency was declared in June 1975. In the following year 1976, the Government of India amended the constitution to incorporate workers participation in management as one of the Directive Principles of State Policy.

In June 1977, the Government of India set up a high-powered Expert Committee on Companies and MRTP Acts under the Chairmanship of Rajinder Sachar with terms of reference to:

(i) Consider the provisions of the Companies Act and MRTP Act and

(ii) To suggest measures participation in management and share capital of companies can be brought about. The Sachar Com­mittee submitted its report in August 1978.

Meanwhile, the Janata Government also set up a “Committee Workers’ Participation Management and Equity” in September 1977 under the Chairmanship of Ravindra Varma the then Union Minister of Labour The Committee consisted of 18 members representing Central Organisations of trade unions and employers and some of the States and professional institutions of management.

The strength of Committee increased to 21 by nominating three additional members in January 1978. The terms of reference of the Committee were to consider, among other things, the need for a statutory scheme for workers’ participation in management. The Committee was also to study and recommend an outline of a comprehensive scheme of workers participation at different levels of management in industrial establishments and undertakings

The Committee submitted its report to the Government in March 1979. The report showed that the majority of the members favoured adoption of a three-tier system of participation, viz., at the shop, plant and corporate or board levels. However, the employer of private sector did not favour board or corporate level participation in management. It also recommended to enact legislation on workers participation in management covering all undertakings, be public or private, employing 500 or more workers.

The Government accepted the recommendations made by the 21-Member Committee on Workers’ Participation in Management and Equity. Based on a review of the working of the various schemes of workers’ participation in management and experiences so gamed the Government formulated and notified a new comprehensive scheme on a voluntary basis for ‘Workers’ Participation in Management’ on 30th December, 1983.

The salient features of the scheme were:

1. The scheme will be non-legislative.

2. It will apply to all central public sector enterprises, expect those specifically exempted.

3. It envisaged constitution of bipartite forums at shop and plant levels.

4. The mode of representation of workers representatives was to be determined by consulta­tion with the concerned unions.

5. A wide range of work related issues were brought within the ambit of the councils.

However, a host of constraints such as multiplicity of unions, inter-union rivalry, lack of proper knowledge on the part of workers about the scheme, etc., served as stumbling blocks in the successful working of the scheme.

Participation of workers in management bill 1990 (Bill No. XXVIII of 1990):

So far, all the schemes pertaining to the workers’ participation in management have been non-­statutory which failed to provide meaningful participation to workers in management.

To remedy the situation, the Government has, therefore, introduced a Bill in the Parliament on 25th May 1990 to provide for:

1. Meaningful three-tier participation of workers in management in all industrial establish­ments.

2. Formulation of scheme specifying criteria regarding nomination of representatives from workers.

3. The principle of secret ballot for determining the representation of workers on the shop floor and establishment level councils.

4. Rules for monitoring the scheme.

5. Deletion of Section 3 of the Industrial Dispute Act, 1947.

6. Rules for appointment of Inspector.

7. Imprisonment up to 2 years or a fine up to Rs. 20,000 or both for contravention of the provisions.

(b) Write a note on Collective Bargaining in India? (16)

-> Collective bargaining is a term used to describe the procedure, whereby employers must attempt to reach an agreement regarding terms of employment and the working conditions of labour with the trade unions, instead of with individual workers.

Collective bargaining is a process of discussion and negotiation between an employer and a trade union culminating in a written agreement and the adjustment of problems arising under the agreement. The Supreme Court of India has defined the process of collective bargaining as a technique by which, dispute as to conditions of employment is resolved amicably by agreement rather than coercion. Workers, who are generally represented by a trade union, use this medium to express their grievance about various issues such as wages and working conditions.

Procedure for initiating collective bargaining

1. A charter of demands

The trade union will notify the employer for initiating collective bargaining negotiations. The representatives of the trade union draft a charter of demands which contains issues related to terms of employment and the working conditions namely wages and allowances, bonuses, working hours, benefits, holidays. In some cases, an employer may also notify the trade union and initiate collective bargaining negotiations.

2. Negotiations

Negotiation is the next step after the submission of the charter of demands by the trade union. Both the employer and the employee seek opportunities to suggest compromise solutions in their favour until an agreement is reached. If it impossible to reach out to an agreement, a third party (mediator / arbitrator) may be brought in from outside. If, even with the assistance of the third party, no viable solution can be found to resolve the parties’ differences, the trade union may decide to engage in strikes.

3. Collective bargaining agreement

Pursuant to the negotiations between the parties, a collective bargaining agreement will be executed between the employer and workmen represented by trade unions, setting out the terms of employment and the working conditions of labour.

4. Strikes

If both parties fail to reach an agreement because of mutual consensus, the union may go on a strike, which shall be in accordance with the provisions of the Industrial Disputes Act 1947 (“ID Act”).

5. Conciliation

Once the conciliation officer receives a notice of strike or lockout, the conciliation proceedings shall commence. The State Government may appoint a conciliation officer or a Board of Conciliation to investigate disputes, mediate and promote a settlement. Workers are prohibited from going on strike during the pendency of such conciliation proceedings. Conciliation proceeding may have one of the three outcomes, namely (i) a settlement; or (ii) no settlement; or (iv) reference being made to the appropriate labour court or any other industrial tribunal.

6. Compulsory arbitration or adjudication

When conciliation and mediation fail, parties may either resort to compulsory or voluntary arbitration. Arbitration and the recommendations of the arbitrator may be binding to the parties. Section 7A of the ID Act provides for a labour court or industrial tribunal within a state to adjudicate protracted industrial disputes such as strikes and lockouts. Section 7B of the ID Act provides for constitution of national tribunals to resolve disputes involving questions of national interest or issues concerning more than two states. In the event, a labour dispute is not resolved by conciliation

and mediation, the employer, and the workers may refer the case by a written agreement to a labour court, industrial tribunal or national tribunal for adjudication or compulsory arbitration.

The following types of collective bargaining agreements are prevalent in India:

1. Bipartite agreements

These agreements are a result of voluntary negotiations between employer and trade union and are binding, as per the provisions of the ID Act.

2. Settlements

It is tripartite in nature as it involves the employer, trade union and the conciliation officer. Settlements arise out of specific disputes which is resolved by a reconciliation officer. If, during the conciliation proceedings, the conciliation officer believes at any point of time that there is a possibility of reaching a settlement, then the officer may withdraw himself from the negotiations. The parties are free to finalise the terms of the agreement and must inform the conciliation officer within a specified timeframe if such an agreement is reached after his withdrawal.

3. Consent awards

These are agreements reached while a dispute is pending before an adjudicatory authority. Such agreement is incorporated in the authority’s award and although the agreement is reached voluntarily between parties, it becomes binding under the award passed by the authority.


Refusal by the employer to bargain collectively in good faith is an unfair labour practice as per the ID Act. Collective bargaining agreements between the trade union and employers are enforceable under Section 18 of the ID Act. For a successful process of collective bargaining, it must begin with proposals

rather than demands and the parties should be ready to negotiate and compromise. The process of collective bargaining enables healthy discussions between workers and employers and facilitate the growth of industrial relations. Having said that, collective bargaining by trade unions often tends to be an arm-twisting exercise given the political affiliation of trade unions in India and it is more about the show of strength by the trade union as opposed to a good faith effort to negotiate genuine demands of workers.

Main Features of Collective Bargaining:

Some of the salient features of collective bargaining are:

1. It is a Group Action:

Collective bargaining is a group action as opposed to individual action. Both the parties of settlement are represented by their groups. Employer is represented by its delegates and, on the other side; employees are represented by their trade union.

2. It is a Continuous Process:

Collective bargaining is a continuous process and does not end with one agreement. It provides a mechanism for continuing and organised relationship between management and trade union. It is a process that goes on for 365 days of the year.

3. It is a Bipartite Process:

Collective bargaining is a two party process. Both the parties—employers and employees— collectively take some action. There is no intervention of any third party. It is mutual given-and-take rather than take-it-or-leave-it method of arriving at the settlement of a dispute.

4. It is a Process:

Collective bargaining is a process in the sense that it consists of a number of steps. The starting point is the presentation of charter of demands by the workers and the last step is the reaching of an agreement, or a contract which would serve as the basic law governing labour-management relations over a period of time in an enterprise.

5. It is Flexible and Mobile and not Fixed or Static:

It has fluidity. There is no hard and fast rule for reaching an agreement. There is ample scope for compromise. A spirit of give-and-take works unless final agreement acceptable to both the parties is reached.

6. It is Industrial Democracy at Work:

Collective bargaining is based on the principle of industrial democracy where the labour union represents the workers in negotiations with the employer or employers. Industrial democracy is the government of labour with the consent of the governed—the workers. The principle of arbitrary unilateralism has given way to that of self-government in industry. Actually, collective bargaining is not a mere signing of an agreement granting seniority, vacations and wage increase, by sitting around a table.

7. It is Dynamic:

It is relatively a new concept, and is growing, expanding and changing. In the past, it used to be emotional, turbulent and sentimental, but now it is scientific, factual and systematic.

8. It is a Complementary and not a Competitive Process:

Collective bargaining is not a competitive process i.e., labour and management do not coopt while negotiating for the same object. It is essentially a complementary process i.e., each party needs something which the other party has, namely, labour can put greater productive effort and management has the capacity to pay for that effort and to organise and guide it for achieving the enterprise’s objectives.

The behavioural scientists have made a good distinction between “distributive bargaining” and “integrative bargaining”. The former is the process of dividing up the cake which represents what has been produced by the joint efforts of management and labour.

In this process, if one party wins something, the other party, to continue the metaphor of the cake, has a relatively smaller size of the cake. So it is a win-lose’ relationship. The integrative bargaining, on the other hand, is the process where both the parties can win—each party contributing something for the benefit of the other party.

9. It is an Art:

Collective bargaining is an art, an advanced form of human relations.

5. Write a note on any two:

(a) Procedure and types of Conciliation.

-> Conciliation is one of the non binding procedures where an impartial third party, known as the conciliator, assists the parties to a dispute in reaching a mutually agreed settlement of the dispute. As per the Halsbury Laws of England, conciliation is a process of persuading parties to each an agreement. Because of its non judicial character, conciliation is considered to be fundamentally different from that of litigation. Generally Judges and Arbitrators decide the case in the form of a judgment or an award which is binding on the parties while in the procedure of the conciliation ,the conciliator who is often a government official gives its report in the form of recommendations which is made public.

Procedure of conciliation
1) Commencement of the conciliation proceedings [Section 62]-
The conciliation proceeding are initiated by one party sending a written invitation to the other party to conciliate. The invitation should identify the subject of the dispute. Conciliation proceedings are commenced when the other party accepts the invitation to conciliate in writing. If the other party rejects the invitation, there will be no conciliation proceedings. If the party inviting conciliation does not receive a reply within thirty days of the date he sends the invitation or within such period of time as is specified in the invitation, he may elect to treat this as rejection of the invitation to conciliate. If he so elects he should inform the other party in writing accordingly.

2) Submission of Statement to Conciliator [Section 65] –
The conciliator may request each party to submit to him a brief written statement. The statement should describe the general nature of the dispute and the points at issue. Each party should send a copy of such statement to the other party. The conciliator may require each party to submit to hima further written statement of his position and the facts and grounds in its support. It may be supplemented by appropriate documents and evidence. The party should send the copy of such statements , documents and evidence to the other party. At any stage of the conciliation proceedings , the conciliator may request a party to submit to him any additional information which he may deem appropriate.

3) Conduct of Conciliation Proceedings[Section 69(1),67(3)]-
The conciliator may invite the parties to meet him. He may communicate with the parties orally or in writing. He may meet or communicate with the parties together or separately. In the conduct of the conciliation proceedings, the conciliator has some freedom. He may conduct them in such manner as he may consider appropriate. But he should take in account the circumstances of the case, the express wishes of the parties, a party’s request to beheard orally and the need of speedy settlement of the dispute.

4) Administrative assistance [S. 68]-
Section 68 facilitates administrative assistance for the conduct of conciliation proceedings. Accordingly , the parties and the conciliator may seek administrative assistance by a suitable institution or the person with the consent of the parties.

(b) Role of Arbitration.

-> Arbitration is a method of dispute settlement using private entities known as “arbitral tribunals”.

Arbitral tribunals usually consist of either one or three arbitrators. The primary role of an arbitral tribunal is to apply the law and make a dispute decision by administering a so-called “arbitral award”.

In principle, arbitral awards are final and binding. They can only be challenged before a state court under exceptional circumstances. For example, it applies to cases where the parties never validly agreed on arbitration. Arbitral awards can be enforced in most countries worldwide.

Arbitration proceedings usually involve the following steps:

Any arbitration proceeding is based on a written agreement of the parties. They submit a given dispute to arbitration instead of the state courts, this becomes the “arbitration agreement”. Arbitration agreements can be found in the majority of commercial contracts, particularly in contracts relating to international transactions.

In terms of procedure, arbitration provides the arbitrators and the parties with significant freedom and flexibility. Parties may choose their arbitrators, the place of arbitration and / or the language of the proceedings. They may also agree on how to structure and how to time their proceedings. However, the parties freedom is still somewhat restricted. They may not deviate from the principles of fairness and equality, the right to be heard and the right to be represented by a lawyer.

Two types of arbitration are available; institutional and ad-hoc. In institutional arbitration, the institution assumes specific administrative functions, such as the servicing of briefs etc. The degree of involvement may vary from one institution to another, but the dispute itself will always be solely decided by the arbitral tribunal. In ad-hoc proceedings, these administrative functions are either assumed by the tribunal itself or delegated to third parties.

Hamburg is the seat of several well-known arbitration institutions, such as the German Maritime Arbitration Association (GMAA), the Court of Arbitration of the Hamburg Chamber of Commerce, the Chinese European Arbitration Centre (CEAC) and various commodity arbitration institutions. Hamburg is also frequently chosen as a place for arbitration by institutions based outside Hamburg, such as the German Institution of Arbitration (DIS) and the International Chamber of Commerce (ICC). The “Hamburg Friendly Arbitrage” is a special form of ad-hoc arbitration developed from local trade usages. These are published in Section 20 of the “Local Usage in the Commodity Trade in Hamburg” (Official Gazette No. 237 dated October 13, 1958). Hamburg based arbitrators have formed the Hamburg Arbitration Circle (HAC) as their association to organize lectures and to support the promotion of Hamburg as a place of arbitration.

Role of Arbitration:-

As arbitration becomes an increasingly attractive alternative way of resolving disputes compared to lengthy and often expensive court proceedings, arbitrators are ever more in demand and their roles increasingly important. Arbitration is often favored over formal litigation not only from a cost and time efficiency perspective, but also because it often offers more practical solutions, and as a process is structured specifically to facilitate resolution.

Thus the arbitrator’s role is a crucial one, and one that demands a unique combination of experience, knowledge and skill. It is increasingly common to find arbitration clauses in consumer and business contracts, and its prevalence only attests to its usefulness as a dispute resolution method.

(c) Adjudication concept.

-> The legal process of reviewing evidence and arguments and providing a decision determining right and wrong is known as adjudication. Adjudication meaning in law is following court procedure or arbitration by a judge or by a neutral third party and giving an impartial judgment. Adjudication meaning as per Black Law Dictionary is pronouncing a judgment or decree in a case.

To define adjudication in layman terms would mean resolving a dispute. It is a widely accepted term and has found its way into the common language used by people. Adjudication definition is conclusive in nature.

The legal process of reviewing evidence and arguments and providing a decision determining right and wrong is known as adjudication. Adjudication meaning in law is following court procedure or arbitration by a judge or by a neutral third party and giving an impartial judgment. Adjudication meaning as per Black Law Dictionary is pronouncing a judgment or decree in a case.

To define adjudication in layman terms would mean resolving a dispute. It is a widely accepted term and has found its way into the common language used by people. Adjudication definition is conclusive in nature.

Types of Adjudication

Adjudication is the process of evaluating the results of a job candidate’s background check against your company’s employment screening policy to help filter out candidates who may not meet your hiring guidelines. By identifying candidates with relevant offenses, adjudication allows you to quickly filter out job applicants whose specific criminal histories disqualify them from the job.

For example, suppose a background check for a delivery driver job applicant shows she was recently convicted of driving under the influence. Depending on your company’s policy, that may prohibit her from being hired for the driver position. Adjudication allows you to spot this and filter her out of the list of qualified candidates.

Types of Adjudication Processes

Employers typically handle the adjudication process for background checks in one of two ways.


In the manual adjudication method, employers compare the results of background checks against their lists of hiring criteria. This often involves using a screening matrix or spreadsheet to sort candidates—disqualifying some, moving others along in the hiring process, and identifying those who need further investigation.

Manual adjudication also introduces a greater possibility of human error, compounded by states, counties and cities that may report the same criminal offense differently. Busy hiring managers may even forget to start the adverse action process for disqualified candidates.

Adjudication in the screening process is an important step, and while manual adjudication might seem like a good way to reduce hiring expenses, when you consider the labor and risks involved, it can actually be very costly.


Some third-party background screening providers offer adjudication as an additional service. A screening provider that automates much of the process can eliminate many of the challenges and weaknesses of manual adjudication.

Of course, you cannot completely automate your adjudication process, nor would you want to. Automated adjudication doesn’t free you from ultimate responsibility for which you hire and reject.

A good automated adjudication solution lets you customize filters to fit your company’s needs and comply with state and local laws and industry regulations. This means you can focus on the information that matters most to your business.

Setting filters and automating workflows can also help eliminate hiring bias, reducing the possibility that preconceived notions or human prejudices will affect your hiring process.

Follow our Socials:

Tap to Download


We are happy you are here


Oh No!

It seems like you have forgotten your password. Don’t worry tell us your email id or username and we’ll try to help
error: Alert: Content is protected !!
Secured By miniOrangeSecured By miniOrange