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II Unit
IR
Origin of trade union
Trade union in India, as in the most other countries, have bee
the natural outcome of modern factory system. The
development of trade unionism in India has a history-
1. Early period:- Efforts towards organizing the workers for
their welfare were made during the early period of industrial
development by social workers, philanthropist and other
religious leaders mostly on humanitarian grounds.
 the first Factories Act, 1881, was passed on the basis of
recommendation of the Bombay Factory Commission.
 Due to the limitation of the Act, the workers in the Bombay
Textile Industry under the leadership of N. Lokhande
demanded reduced hours of work, weekly rest days, mid day
recess ad compensation for injuries.
 The Bombay Mill owner’s Association conceded the demand
for weekly holidays.
 Consequently, Lokhande established the first Worker’s Union
in India in 1890 in the name of Bombay Mill- hands
Association.
 Some other important unions established during this period.
2. Modest Beginning
 The beginning of the labour movement in the modern sense started after
the outlook of World War I in the country.
 economic, social and political conditions of the day influenced the growth
of trade union movement in India.
 Establishment of ILO in 1919 helped the formation of trade unions in the
country.
 A number of trade unions were established between 1919 – 1923.
 Category wise unions like Spinner’s union and Weaver’s union came into
existence in Ahmedabad under the inspiration of Mahatma Ghandhi.
 These unions were later federated into an industrial union known as
Ahmedabad Textile Labour Association.
 This union has been formed on systematic lines and has been functioning
on sound lines, based on the Ghandhian Philosophy of mutual trust,
collaboration and non-violence.
3.Emergence of Leftwing Trade Unions
 The period between 1924-1935 :- The year 1921 saw as the
emergence of communist on the Indian scene. The All India
Trade Union Congress (AITUC) was captured by the
communist .
 The moderates formed a new organization, called the All India
Trade Union Federation.
 Ideological difference and splits had their effect on strikes too.
 Majority of strikes were failed.
 During this period, a number of important acts were passed in
the country such as-
a. The Mines Act, 1923
b. workmen‘s C compensation Act, 1923
c. The Trade Union Act, 1926
d. The Trade Disputes Act, 1929
 The passing of Trade union Act ,1926, gave formal recognition to
the worker’s right to organize.
 In July, 1929, The Royal Commission on labour was appointed to
enquire into the existing conditions of labour in industrial
undertakings and plantations.
 In 1930, India came under the way of world wide depression.
employers introduced wage-cuts and retrenchment.
 The government ultimately banned the communist party and
declared the Trade unions controlled by them as illegal.
4. Increase in Trade union activity and unity moves (the period
between 1940-1946) :- this period witnessed an increase in the
number of registered trade unions and their membership.
 The National Trade Union Federation (NTUF), which claimed a larger
membership than the AITUC and the AITUC merged together in
1938.
 One of the important reason of merger was that no political
decision should be taken unless it command a two- three unions, it
was finally achieved in 1940 with N.M. Joshi who became the
General Secretary of the AITUC.
5. Union Activity during the II World War(the period between
1940-1946)
 The unity was shattered during the II World War because of
ideological difference and mounting cost of living.
 Industrial unrest increased and the government banned
strikes and lockouts.
 Workers realize the need for an organized movement to
secure relief.
 The realization lead to an increase in the number of unions in
May 1947, the Indian National Trade union Congress (INTUC)
was born.
 The INTUC was the largest federation of trade unions and
therefore the most representative organization of workers in
the country.
6. The Post war and the post independence period
(after 1947)
 For the first time, the INTUC was recognized as the most
representative body of the working class in India in 1948 and
its representatives constituted the labour delegation to the
ILO conference in 1948, the Hind Majdoor Sabha(HMS) was
formed and in 1949 the united trade congress was formed.
 As years went by, more unions and central organization come
into existence.
7. Present Position:- at present there are about 56,000
registered workers union and 10 central labour organizations
in our country.
 A very small percentage of these unions regularly submit data
themselves.
 As it is difficult to know about their individual characteristics
and working.
Recognition of the trade union
 The underlying idea of forming a trade union is to negotiate
and bargain with employers to improve the service ad
employment conditions of workers on their behalf.
 This collective bargaining process can be possible only when
the employer recognizes the trade union as a bargaining agent
and agrees to negotiate with it because it is difficult to
negotiate with multiple trade unions is a single organization.
 The Trade Union Act, 1926, the only Central Law, which
regulates the working of the unions, does not have any
provision for recognition of trade unions
 Some attempts were made to include compulsory recognition
in the Trade Union Act in 1947, 1950,1978 ad 1988, but these
did not get materialized.
The usual methods used to determine union strength, which is the
basis for recognition are the following:-
I. Election by Secret Ballot:- Under this system, all eligible workers
of an establishment may vote for their chose union and the
elections are to be conducted by neutral agent, generally the
Register of Unions, in a manner very similar to the conduct of
general elections. Once held, the result of the elections would
remain valid for a minimum period.
II. Check- off method:- under this each individual worker authorizes
management in writing to deduct union fees from his wages and
credit these to the chosen union. This gives management concrete
evidence about the respective strengths of the union.
III. Rule of thumb:- it is one of intelligent guessing by management or
general observations to assess the union strength, either by the
response at gate meeting , strikes or discussions with employees.
This not a reliable method, particularly in large establishments can
also be subject to change at short intervals.
 In the above methods, the first one is an universally accepted
method used all over the world but there has been no consensus
among the trade unions on that in India.
 The second National Commission of Labour(2003) considered the
issues seriously and made the following recommendations:-
a. We recommend that the negotiating agent should be selected for
recognition on the basis of check off system. A union with 66%
membership is entitled to be accepted as the single negotiating
agent, and if no union has the support of more than 25% should
be given proportionate representation on the negotiating table.
b. Secret ballot is logically and financially a difficult process in certain
industries. Check off system has the advantage of ascertaining the
relative strength of trade unions. Check off system should be made
compulsory for all establishments employing 300 or more workers.
Recognition once granted, should be valid for a period of four
years.
Rights of Recognized Unions
 The right to raise issues with the management.
 Right to collect membership fees within the premises of the
organization.
 Ability to demand check- off facility.
 Ability to put up a notice board on the premises for union
announcements.
 Ability to hold discussions with employees at a suitable place within
the premises.
 Right to discuss member’s grievance with employer.
 Ability to inspect beforehand a place of employment or work of its
members.
 Nominations of its representatives on committees formed by the
management for industrial relations purposes as well as in statutory
bipartite committees.
Problems Confronting Unions
The following reasons were identified for the slow progress of
trade union in India:-
1.Emergence of outside leadership:- Outside leadership is
playing an important role in the Indian Trade Union
Movement due to the inability of insiders to lead their
movement.
 In view of the low education standards and poor command
over English language, low level of knowledge about labour
legislation, unsound financial position, fear of victimization by
the employer and lack of leadership qualities, outside leaders
have come to stay.
 The main reason for this trend is that the Trade Unions
Act,1926 , itself provided the scope for outside leadership.
The Evil Effects of Outside Leadership
The evil effects of outside leadership analyzed by the National
Commission on Labour are as follows:-
 Outside leadership undermined the purposes of Trade Unions
and weakened their authority, personal benefits ,sometimes,
weighed more than unions
 Outside leadership has been responsible for slow growth of
Trade Unions.
 Internal leadership has not been developed fully.
 Most of the leaders cannot understand the worker’s problems
as they do not live the life of a worker.
2. Multiple Unions:- Multiple unions both at the plant and industry
levels pose a serious threat to industrial peace ad harmony in India.
 The situation of multiple unions is said to prevail when two or more
unions in the same plant try to assert rival claims over each other
and function with overlapping jurisdiction.
 Multiple unions affects the industrial relations system both
positively and negatively.
 The negative impacts of multiple unions dominate the democracy,
competition etc.
 The nature of competition tends to convert itself into a sense of
unfair competition resulting in their union- rivalry.
 The rivalry destroys mutual trust and cooperation among
leadership.
 It is the major cause for weakening the trade union movement I
India.
3. Union Rivalry:- The state of rivalry between two groups of the
same union is said to be inter-union rivalry. Inter ad intra
union rivalries have been a potent cause of industrial disputes
in the country. They are responsible for weak bargaining
power of trade unions in collective bargaining. These rivalries
are responsible for slow growth of trade union movement in
the country.
4.Finance :- Most of the trade unions in India suffer from
inadequate funds. The unsound financial position is mostly
due to low membership and low rate of membership fee.
The Trade Union Act, 1926, prescribed the membership fee @ 25
paisa per month. But the National Commission on Labour
recommended the increase of rate of membership
subscription from 25 paisa to Rs. 1 in the year 1990. but the
government did not accept this recommendation.
As the National Commission on Labour observe, “ an important
factor limiting the effective functioning of unions in our
country has been their financial weakness.”
In most unions, poor finances are the result of inadequate
membership strength. This, in turn can be traced to the small
size of units. The general picture of finances of unions is
disappointing.
Other factors responsible for the unsound functioning of trade
union in India are:-
a. Uneven growth
b. Illiteracy
c. Low membership
d. Heterogeneous nature of labour
e. Lack of interest
f. Absence of paid office bearers.
Measures to strengthen trade union in India
1. United labour front:- unions must present a joint front.
Multiple union dissipate their energies, dilute their power
and reduce their effectiveness. Trade unions should form a
sort of labour party and all the trade unions in the country
should be affiliated to it. It gives adequate strength to the
trade unions both in industry and Parliament.
2. Internal fees :- outside political leadership has developed
due to the absence of internal leadership. Outside
leadership is the main cause for the multiple problems of the
trade unions. These problems can be removed through the
development of leadership talents from within.
Management should encourage internal workers to lead
their own movement. Management and trade unions should
provide educational and training facilities for the
development of internal leadership.
3. Membership fees:- the membership fees should be raised as the
amount of wages of the workers increased significantly. Even the
amended Rs. 12/- per annum is not sufficient. Some other source of
finance may also explored to make trade union financially healthy.
4. Other measures:-
 Trade union should extend welfare measures to the members and
actively pursue social responsibilities. Social responsibility of trade
union should go beyond their limited constituency within members
only.
 Trade union should make efforts to raise their declining
membership.
 Attracting and retaining new breed of workers by scouting and
monitoring them.
 Trade union must reorient themselves from political ideological
obsession to Business Partners in progress, sharing the gains.
 Bureaucratic organization to democratic and service
organization.
 Complacency to struggle.
 Power hunger to service orientation.
 Trade union should be smart, IT savvy, online working to have
connectivity to employers abroad as also International Trade
Unions and other Trade bodies.
 In order to make members updated, Trade unions must
organize continuous training and development programs.
 The Trade Union Act should be amended in order to avoid
dual membership.
 There should be legal provision for the recognition of the
representative union in central legislation also.
 Union should not intervene in day to day matters of business.
They must focus on important issues affecting workers.
Strategies and tactics for remaining union free
Managers develop long- term strategies and effective tactics to
present unionization of their organizations. Most of them are-
 Open communication.
 A healthy and safe working environment.
 Effective remuneration.
 Effective training and development programs.
 Effective personnel planning, recruitment and selection.
 Effective personnel research.
Personnel research
The purpose of personnel research is to identify human resource
problems at an early date, so that remedial action may be taken
before the problem gets magnified.
A wide range of problems are covered in the personnel research such
as:-
 Wage survey
 Effectiveness of various recruitment sources
 Test validation
 Effectiveness of training efforts
 Supervisor’s effectiveness survey
 Recent labour settlements
 Job analysis
 Job satisfaction survey
 Survey of employee needs
 Performance appraisal validation
 Attitude survey towards reward system
 Areas of high accident frequency
 Turnover analysis
 Customer complaints survey
Reasons for discouraging unionization by
employers
Employers may discourage unionization. Their fear about unions
stem from:-
 Increased cost because of higher remuneration and other
non- monetary benefits and services.
 Loss of freedom to reward superior performance.
 Loss of control over operations- erosion of management’s
authority.
 Lack of ability to adapt quickly to changing demands
Introduction of Trade Union
Employees associations are popularly known as trade unions in
IR. Trade unions are not confined to mere striking and
negotiating on behalf of workers. Their role is wider.
Unions may take their presence felt in recruitment and selection.
They may also decide who is to be hired and under what
conditions. Unions can also play an important role in deciding
who is to be promoted, given a new job assignment, sent for
training, terminated or laid off. Many programs which
contribute to QWL and productivity are undertaken by the
management in consultation with and with the co- operation
of the unions
Unions decide wage and salary structure and negotiate revision
once in 3/5 years.
Definition of Trade Union
Trade unions are voluntary organizations of workers formed to
promote and protect their interest through collective action.
The Trade Union Act, 1926 defines a Trade union as combination,
whether temporary or permanent, formed-
 Primarily for the purpose of regulating the relation between
a. Workmen and employers.
b. Between workmen and workmen.
c. Between employers and employers.
 For imposing restrictive conditions on the conduct of any
trade or business and includes any federation of two or more
trade unions.
Characteristics of Trade Unions
 Association:- A trade union is an association or combination
of employees. It has large number of worker members from
one or more occupations.
 Voluntary :- Membership of a trade union is voluntary.
Generally, there is no legal or other pressure to join a trade
union and a person can join or leave the union on his free will.
 Permanent :- A trade union is a continuing or permanent
combination rather then a temporary or casual combination.
It has to be a long- term body as otherwise it cannot achieve
its objectives.
 Union of common interest:- Members of a trade union have
common interests and problems, which motivates them to
unite. A union seeks to regulate relations between employers
and workers.
 Collective action:- Trade unions always act through united
action by the members to protect and promote their
economic and other interests.
 Sub- systems:- A trade union is sub- system of the social
system. Therefore its character undergoes change with
changes in economic, social, legal and political conditions in
the country. A union functions collectively to protect and
promote the interests of its members within a given socio-
economic system together unified body.
Objectives of Trade Unions
Following are the objectives of trade unions:-
 To secure for the workers fair wages in the light of the
changing cost of living and prevailing standards of living.
 To improve working conditions by securing shorter working
hours, better leave facilities, adequate social security, better
housing and education and other welfare benefits.
 To assure the workers a share in the increased profitability of
industry through payment of adequate bonus.
 To ensure security of employment by resisting retrenchment.
 To protect workers against exploitation and victimization by
the capitalists.
 To protect the larger interest of society by assisting in the
improvement of trade and industry.
Why workers join Trade Unions?
Workers organize themselves into a trade union due to the following
reasons:-
 Steady employment:- Workers form a trade union to secure their
services. Unions take political action to get legislative protection
against dismissal. They also resist any attempt of the employer to
retrench workers.
 Economic benefits:- An individual worker is not in a position to
secure good pay and proper working conditions from the employer.
Worker join union because union has great bargaining power to get
these economic benefits for workers.
 Check on arbitrary actions:- If workers are not united, an employer
may adopt arbitrary policies and procedures to exploit them.
Workers form unions to ensure rational and uniform personal
policies and their unbiased implementation on the part of
management.
 Economic security:- Unions protect their members from
various possible economic hazardous such as illness,
accidental injury, unemployment. They contact employers to
pay compensation and retirement benefits. Unions also have
funds to provide financial support to distressed members.
 Self- expression:- Workers join unions to communicate with
management. Union serves as a platform through which a
worker can make his voice heard by the employer.
 Sense of belonging:- By joining the union worker can
associate with fellow workers and gain social respect. He can
also discuss his problems with trade union leader. Trade union
generate a sprit of self-reliance and self respect among
workers.
 Recognition and participation:- workers can gain recognition
as equal partners with employer by joining unions. They can
participate in management of industry. They can influence
decisions, affecting their interests, through collective
bargaining.
 Industrial relations:- Another reason for workers to join a
union is the need for an adequate machinery to maintain
proper relations between management and labour. Union
provides this machinery through collective action.
 Leadership :- Some workers join trade unions to fulfill their
political ambitions. They can use the union as the stepping
stone to become leaders. They may rise in their political
career by obtaining an officer of the union.
Functions of trade unions
 Protection of workers
 Proper standard of living
 Grievance redressal
 Collective bargaining
 Participation
 Protests
 Education
 Welfare and recreation
 Legislation
 Representation
 Advice
 communication
Functions relating to Industrial organizations
 To highlight industrial organization as a joint enterprise
between workers and management and to promote identity
of interest.
 To increase production quantitatively as well as qualitatively,
by laying down the norms of production and ensuring their
adequate observance.
 To help in maintenance of discipline.
 To create opportunities for workers participation in
management and to strengthen labour management co-
operation.
 To create favorable opinion of the management towards trade
unions and improve their status in industrial organization.
 To impress upon the management the need to adopt
reformative and not punitive, approach towards workers fault.
Functions relating to trade unions organization
 To formulate policies and plans consistent with those of the
industrial organization and society at large.
 To improve financial position by fixing higher subscription, by
realizing the union dues and by organizing special fund raising
campaigns.
 To train members to assume leadership position.
 To keep away from advocating the adoption of unfair
practices.
 To save the union organization from the exploitation by vested
interests personal and political.
 To publicize the trade union objectives and functions, to know
people’s reaction towards them and to make necessary
modifications.
Functions relating to society
 To render all sorts of constructive co- operation in the
formulation and implementation of plans and policies relating
to national development.
 To actively participate in the development of programs of
national development.
 To launch social campaign against social evils of corruption,
casteism, regionalism, linguism, price rise, black marketing ,
smuggling, illiteracy, and disease etc.
 To create public opinion favorable to governments policies
and plans, and to mobilize people’s participation for the
effective implementation.
 To enable unorganized sector to organize itself.
Types of trade unions
• Craft union:- It is an organization of workers employed in a
particular craft, trade or occupation. Therefore, such unions tend to
be well cohesive.
 Due to their identical training and skills, members of a craft union
tend to develop unity among them.
 Members are generally crafts concious rather than class concious.
 A craft union has strong bargaining power because its workers
possess a specialized skills which cannot be easily replaced in case
of a strike.
 But sometime due to different agreement in different crafts, joint
action by workers belonging to different crafts in not easily
possible.
 Craft unions tend to oppose technological advancements.
 Craft unions are horizontal in character because their members
belong to a single process or group of processes.
 In India, crafty unions are found largely among white-collar workers
and professional such as Government employees, bank employees,
doctors, lawyers, teachers etc.
 There are very few craft unions of industrial workers.
• Industrial unions:- An industrial union is organized on an industry
basis rather than a craft basis.
 Its members belong to different crafts within the same industry.
 Ahmedabad Textrile Labour Association, the Rashtriya Mill Mazdoor
Sangh etcx.
 These unions are vertical in nature because they consist of all type
of workers in an industry.
 Industrial unions are more powerful because they consist of both
skilled and unskilled workers.
 Such a union cuts across skill and craft distinctions of workers.
 It is easier for the employer to bargain with one union to cover all
workers of a particular industry.
 Worker is saved of the trouble of bargaining with a number of
unions established on a craft basis.
 However, skilled workers may feel swamped by unskilled workers
and their specific demands may not be met
 In these days, technological and mass production have obliterated
the craft distinctions and therefore, industrial unions are the need
of the hour.
• General union:- This type of union consists of workers
employed in different industries and crafts within a particular
city or region. The Jamshedpur Labour Union is the example.
In India there are several industry cum region unions due to
the concentration of some industries in particular regions.
• Federations:- These are national level bodies to which plant
level unions, crafts unions, industrial unions and general
unions are affiliated. Federations are the apex organizations of
workers. They act as coordinating agencies. These are also
called central trade unions
Central trade unions in India
 Indian National Trade Union Congress(INTUC), 1947
 All India Trade Union Congress (AITUC), 1920
 Center of Indian Trade Unions (CITU), 1970
 Bhartiya Mazdoor Sangh (BMS), 1955
 Hind Mazdoor Sabha (HMS), 1948
 United Trade Union Congress (UTUC),1971
 Hind Mazdoor Kishan Panchayat (HMKP), 1962
 National Front of Indian Trade Unions (NFITU) , 1967
Collective Bargaining
• Collective bargaining is a procedure by which the terms and
conditions of workers are regulated by agreement between
their bargaining agents and employers.
• The basic objective of collective bargaining is to arrive at an
agreement on wages and other conditions of employment.
• The underlying idea of collective bargaining is that the
employer and employee relations should not be decide
unilaterally or with the intervention of any third party.
• Both parties must reconcile their difference voluntarily
through negotiations, yielding some concessions and making
sacrifices in the process.
• Both parties have, more or less, realized the importance of
peaceful coexistence for their mutual benefit and continued
progress.
• Industrial bargaining has three approaches-
I. Unilateral approach in which the employer alone decides the
terms and conditions of employment. This is known as
individual bargaining.
II. Bilateral approach in which the employer and worker
negotiate with each other. When worker men/ their
association and their representatives negotiate with one
another, it is known as bipartite collective bargaining.
III. Tripartite approach in which besides the two main parties, a
third party also intervenes to facilitate settlement.
• Collective bargaining is a process of joint decision making, a
democratic way of life in industry. it establishes a culture of
bipartism and joint consultations for establishing industrial
harmony.
Definition of collective bargaining
 It is called “collective” because both employers and workers
act as a group rather than as individuals, and it is described as
“bargaining” because the method of reaching an agreement
involves approach proposals and current proposals, offers and
counter- offers and a give and take approach.
 According to ILO it is defined as, “ negotiations about working
conditions and terms of employment between an employer
and one or group of employers or one or more employees
organization. On the one hand, and one or more
representatives of worker’s organizations on the other, with a
view to reaching agreement.”
 Collective bargaining is a continuous process of solving
problems, on the principle of give and take and balance of
power.
Features of collective bargaining
• Collective :- It is collective in two ways. One is that all the workers
collectively bargain for their common interests and benefits. Second
is that workers and management jointly arrive at an amicable
solution through negotiation.
• Strength:- Across the table both parties bargain from a position of
equal strength. It is industrial democracy at work.
• Flexible:- it is a group action where representatives of workers and
management expend energies in order to arrive at a consensus.
This is the unique feature of collective bargaining is that usually the
parties concerned start negotiations with entirely divergent views
but finally reach a middle point acceptable to both. It is a give and
take process.
• Voluntary:- Both workers and management come to the
negotiating table voluntarily in order to have a meaningful view on
various troubling issues. They try to probe each other’s views
thoroughly before arriving at an acceptable solution.
• Continuous :- It is a continuous process. It does not commence
with negotiations and end with an agreement. The agreement is
only a beginning of collective bargaining . It is a continuous process
which includes implementation of the agreement and also further
negotiations.
• Dynamic:- It is a dynamic process because the way agreements are
arrived at , the way they implemented the mental make – up of
parties involved keeps changing. As a result, the concept itself
changes, grows and expands over time.
• Power relationship :- Workers want to gain the maximum from
management and management wants to extract the maximum
from workers by offering as little as possible. To reach a solution,
both have to retreat from such positions and accept less than what
is asked for and give more than what is on offer. By doing so
management tries to retain its control on work place matters and
unions attempt to strengthen their hold over workers without any
serious dilution of their powers.
• Representation:-The chief participants in collective bargaining
do not act for themselves. They represent the claims of labour
and management while trying to reach an agreement.
• Bipartite process :-The employers and the employee
negotiate the issues directly, face to face or across the table.
There is no third party intervention.
Objectives of collective bargaining
 To settle disputes relating to wages and working conditions.
 To protect the interests of workers through collective action.
 To resolve the differences between workers and management
through voluntary negotiations and arrive at a consensus.
 To avoid third party intervention in matters relating to
employment.
Types of bargaining
• Conjunctive bargaining :- The parties try to maximize their
respective gains. They to settle economic issues such as
wages, benefits, and bonus etc through a zero sum game.
Unions negotiate for maximum wages. Management wants to
yield as little as possible- while getting things done through
workers.
• Co-operative bargaining:- When companies are hit by
recession. They can not offer the kind of wages and benefits
demanded by workers. At the same time they cannot survive
without the worker’s support. Both parties realize the
importance of surviving in such difficulty and are willing to
negotiate the terms of employment in a flexible way.
Labour may accept a cut in wages in return for job security and
higher wages when things improve. Management agrees to
modernize and bring in new technology and invest in
marketing efforts in a phased manner.
• Productive bargaining :- In this method worker’s wages and
benefits are linked to productivity. A standard productivity
index is finalized through negotiations initially. Workers do not
have to perform at exceptionally high levels to beat the index.
If they are able to exceed the standards productivity norms
workers will get substantial benefits. A management gain
control over work place relations and is able to tighten the
norms still further in future negotiations.
• Composite bargaining:- In this method labour bargains for
wages as usual but goes a step further demanding equity in
matters relating to work norms, employment levels, manning
standards, environmental hazards, sub- contracting clauses
etc.
Through composite bargaining unions are able to prevent the
dilution of their powers and ensure justice to workers by
putting certain limits on the freedom of employers. For the
employer this is lesser evil when compared to strike and
lockouts.
Process of collective bargaining
Process of collective bargaining involves the following stages:-
• Step I: Pre-Negotiation Phase :- This is the stage before
starting collective bargaining. At this stage, the management
wants to estimate the power and capacity of labor unions. At
this stage, all the relevant data, information and figures are
collected so that the stage may be prepared for negotiation.
• Step II : Selection of Negotiators:- at this stage, both the
management and labour unions select their representatives
who will take part in negotiations from their side. Only such
persons are selected as negotiators who are fully acquainted
with the problems on which negotiations are going to be held.
• Step III : Strategy of Bargaining :- Management should decide
the basic strategies and policies that will be followed at the
time of bargaining with employees. Every thing must be made
clear before going to the bargaining table. In addition to this,
the management should get due powers to enter into
agreements with workers. Similarly, labor unions should also
determine the strategies on the basis of which they will take
part in negotiation.
• Step IV : Tactics of Bargaining :- The technique of collective
bargaining depends upon the principle of “Give and Take”.
Both the parties try to get more than they sacrifice. All the
aspects of contracts are discussed in details. After this, the
decisions are resolved and reviewed. The services of
government mediators can also be used if required.
• Step V : Contract :- fifth stage of the process of collective
bargaining is to enter into a collective agreement. Such
agreements are made for a certain time these agreements
give full details of security of job, grievance handling
procedure, promotion policy, transfer policy, rules regarding
layoff, rules regarding retrenchment, hour of work, rules
regarding leaves, incentive schemes, security and health,
managerial liability etc
• Step VI : Implementation of the contract : The last stage of
the process of collective bargaining is the implementation of
the agreements entered into between management ad labor
unions. Both the parties should honor these agreements
implement them whole heartedly.

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industrial relationship unit 2

  • 2. Origin of trade union Trade union in India, as in the most other countries, have bee the natural outcome of modern factory system. The development of trade unionism in India has a history- 1. Early period:- Efforts towards organizing the workers for their welfare were made during the early period of industrial development by social workers, philanthropist and other religious leaders mostly on humanitarian grounds.  the first Factories Act, 1881, was passed on the basis of recommendation of the Bombay Factory Commission.  Due to the limitation of the Act, the workers in the Bombay Textile Industry under the leadership of N. Lokhande demanded reduced hours of work, weekly rest days, mid day recess ad compensation for injuries.
  • 3.  The Bombay Mill owner’s Association conceded the demand for weekly holidays.  Consequently, Lokhande established the first Worker’s Union in India in 1890 in the name of Bombay Mill- hands Association.  Some other important unions established during this period.
  • 4. 2. Modest Beginning  The beginning of the labour movement in the modern sense started after the outlook of World War I in the country.  economic, social and political conditions of the day influenced the growth of trade union movement in India.  Establishment of ILO in 1919 helped the formation of trade unions in the country.  A number of trade unions were established between 1919 – 1923.  Category wise unions like Spinner’s union and Weaver’s union came into existence in Ahmedabad under the inspiration of Mahatma Ghandhi.  These unions were later federated into an industrial union known as Ahmedabad Textile Labour Association.  This union has been formed on systematic lines and has been functioning on sound lines, based on the Ghandhian Philosophy of mutual trust, collaboration and non-violence.
  • 5. 3.Emergence of Leftwing Trade Unions  The period between 1924-1935 :- The year 1921 saw as the emergence of communist on the Indian scene. The All India Trade Union Congress (AITUC) was captured by the communist .  The moderates formed a new organization, called the All India Trade Union Federation.  Ideological difference and splits had their effect on strikes too.  Majority of strikes were failed.  During this period, a number of important acts were passed in the country such as- a. The Mines Act, 1923 b. workmen‘s C compensation Act, 1923 c. The Trade Union Act, 1926 d. The Trade Disputes Act, 1929
  • 6.  The passing of Trade union Act ,1926, gave formal recognition to the worker’s right to organize.  In July, 1929, The Royal Commission on labour was appointed to enquire into the existing conditions of labour in industrial undertakings and plantations.  In 1930, India came under the way of world wide depression. employers introduced wage-cuts and retrenchment.  The government ultimately banned the communist party and declared the Trade unions controlled by them as illegal. 4. Increase in Trade union activity and unity moves (the period between 1940-1946) :- this period witnessed an increase in the number of registered trade unions and their membership.  The National Trade Union Federation (NTUF), which claimed a larger membership than the AITUC and the AITUC merged together in 1938.  One of the important reason of merger was that no political decision should be taken unless it command a two- three unions, it was finally achieved in 1940 with N.M. Joshi who became the General Secretary of the AITUC.
  • 7. 5. Union Activity during the II World War(the period between 1940-1946)  The unity was shattered during the II World War because of ideological difference and mounting cost of living.  Industrial unrest increased and the government banned strikes and lockouts.  Workers realize the need for an organized movement to secure relief.  The realization lead to an increase in the number of unions in May 1947, the Indian National Trade union Congress (INTUC) was born.  The INTUC was the largest federation of trade unions and therefore the most representative organization of workers in the country.
  • 8. 6. The Post war and the post independence period (after 1947)  For the first time, the INTUC was recognized as the most representative body of the working class in India in 1948 and its representatives constituted the labour delegation to the ILO conference in 1948, the Hind Majdoor Sabha(HMS) was formed and in 1949 the united trade congress was formed.  As years went by, more unions and central organization come into existence. 7. Present Position:- at present there are about 56,000 registered workers union and 10 central labour organizations in our country.  A very small percentage of these unions regularly submit data themselves.  As it is difficult to know about their individual characteristics and working.
  • 9. Recognition of the trade union  The underlying idea of forming a trade union is to negotiate and bargain with employers to improve the service ad employment conditions of workers on their behalf.  This collective bargaining process can be possible only when the employer recognizes the trade union as a bargaining agent and agrees to negotiate with it because it is difficult to negotiate with multiple trade unions is a single organization.  The Trade Union Act, 1926, the only Central Law, which regulates the working of the unions, does not have any provision for recognition of trade unions  Some attempts were made to include compulsory recognition in the Trade Union Act in 1947, 1950,1978 ad 1988, but these did not get materialized.
  • 10. The usual methods used to determine union strength, which is the basis for recognition are the following:- I. Election by Secret Ballot:- Under this system, all eligible workers of an establishment may vote for their chose union and the elections are to be conducted by neutral agent, generally the Register of Unions, in a manner very similar to the conduct of general elections. Once held, the result of the elections would remain valid for a minimum period. II. Check- off method:- under this each individual worker authorizes management in writing to deduct union fees from his wages and credit these to the chosen union. This gives management concrete evidence about the respective strengths of the union. III. Rule of thumb:- it is one of intelligent guessing by management or general observations to assess the union strength, either by the response at gate meeting , strikes or discussions with employees. This not a reliable method, particularly in large establishments can also be subject to change at short intervals.
  • 11.  In the above methods, the first one is an universally accepted method used all over the world but there has been no consensus among the trade unions on that in India.  The second National Commission of Labour(2003) considered the issues seriously and made the following recommendations:- a. We recommend that the negotiating agent should be selected for recognition on the basis of check off system. A union with 66% membership is entitled to be accepted as the single negotiating agent, and if no union has the support of more than 25% should be given proportionate representation on the negotiating table. b. Secret ballot is logically and financially a difficult process in certain industries. Check off system has the advantage of ascertaining the relative strength of trade unions. Check off system should be made compulsory for all establishments employing 300 or more workers. Recognition once granted, should be valid for a period of four years.
  • 12. Rights of Recognized Unions  The right to raise issues with the management.  Right to collect membership fees within the premises of the organization.  Ability to demand check- off facility.  Ability to put up a notice board on the premises for union announcements.  Ability to hold discussions with employees at a suitable place within the premises.  Right to discuss member’s grievance with employer.  Ability to inspect beforehand a place of employment or work of its members.  Nominations of its representatives on committees formed by the management for industrial relations purposes as well as in statutory bipartite committees.
  • 13. Problems Confronting Unions The following reasons were identified for the slow progress of trade union in India:- 1.Emergence of outside leadership:- Outside leadership is playing an important role in the Indian Trade Union Movement due to the inability of insiders to lead their movement.  In view of the low education standards and poor command over English language, low level of knowledge about labour legislation, unsound financial position, fear of victimization by the employer and lack of leadership qualities, outside leaders have come to stay.  The main reason for this trend is that the Trade Unions Act,1926 , itself provided the scope for outside leadership.
  • 14. The Evil Effects of Outside Leadership The evil effects of outside leadership analyzed by the National Commission on Labour are as follows:-  Outside leadership undermined the purposes of Trade Unions and weakened their authority, personal benefits ,sometimes, weighed more than unions  Outside leadership has been responsible for slow growth of Trade Unions.  Internal leadership has not been developed fully.  Most of the leaders cannot understand the worker’s problems as they do not live the life of a worker.
  • 15. 2. Multiple Unions:- Multiple unions both at the plant and industry levels pose a serious threat to industrial peace ad harmony in India.  The situation of multiple unions is said to prevail when two or more unions in the same plant try to assert rival claims over each other and function with overlapping jurisdiction.  Multiple unions affects the industrial relations system both positively and negatively.  The negative impacts of multiple unions dominate the democracy, competition etc.  The nature of competition tends to convert itself into a sense of unfair competition resulting in their union- rivalry.  The rivalry destroys mutual trust and cooperation among leadership.  It is the major cause for weakening the trade union movement I India.
  • 16. 3. Union Rivalry:- The state of rivalry between two groups of the same union is said to be inter-union rivalry. Inter ad intra union rivalries have been a potent cause of industrial disputes in the country. They are responsible for weak bargaining power of trade unions in collective bargaining. These rivalries are responsible for slow growth of trade union movement in the country. 4.Finance :- Most of the trade unions in India suffer from inadequate funds. The unsound financial position is mostly due to low membership and low rate of membership fee. The Trade Union Act, 1926, prescribed the membership fee @ 25 paisa per month. But the National Commission on Labour recommended the increase of rate of membership subscription from 25 paisa to Rs. 1 in the year 1990. but the government did not accept this recommendation.
  • 17. As the National Commission on Labour observe, “ an important factor limiting the effective functioning of unions in our country has been their financial weakness.” In most unions, poor finances are the result of inadequate membership strength. This, in turn can be traced to the small size of units. The general picture of finances of unions is disappointing. Other factors responsible for the unsound functioning of trade union in India are:- a. Uneven growth b. Illiteracy c. Low membership d. Heterogeneous nature of labour e. Lack of interest f. Absence of paid office bearers.
  • 18. Measures to strengthen trade union in India 1. United labour front:- unions must present a joint front. Multiple union dissipate their energies, dilute their power and reduce their effectiveness. Trade unions should form a sort of labour party and all the trade unions in the country should be affiliated to it. It gives adequate strength to the trade unions both in industry and Parliament. 2. Internal fees :- outside political leadership has developed due to the absence of internal leadership. Outside leadership is the main cause for the multiple problems of the trade unions. These problems can be removed through the development of leadership talents from within. Management should encourage internal workers to lead their own movement. Management and trade unions should provide educational and training facilities for the development of internal leadership.
  • 19. 3. Membership fees:- the membership fees should be raised as the amount of wages of the workers increased significantly. Even the amended Rs. 12/- per annum is not sufficient. Some other source of finance may also explored to make trade union financially healthy. 4. Other measures:-  Trade union should extend welfare measures to the members and actively pursue social responsibilities. Social responsibility of trade union should go beyond their limited constituency within members only.  Trade union should make efforts to raise their declining membership.  Attracting and retaining new breed of workers by scouting and monitoring them.  Trade union must reorient themselves from political ideological obsession to Business Partners in progress, sharing the gains.
  • 20.  Bureaucratic organization to democratic and service organization.  Complacency to struggle.  Power hunger to service orientation.  Trade union should be smart, IT savvy, online working to have connectivity to employers abroad as also International Trade Unions and other Trade bodies.  In order to make members updated, Trade unions must organize continuous training and development programs.  The Trade Union Act should be amended in order to avoid dual membership.  There should be legal provision for the recognition of the representative union in central legislation also.  Union should not intervene in day to day matters of business. They must focus on important issues affecting workers.
  • 21. Strategies and tactics for remaining union free Managers develop long- term strategies and effective tactics to present unionization of their organizations. Most of them are-  Open communication.  A healthy and safe working environment.  Effective remuneration.  Effective training and development programs.  Effective personnel planning, recruitment and selection.  Effective personnel research.
  • 22. Personnel research The purpose of personnel research is to identify human resource problems at an early date, so that remedial action may be taken before the problem gets magnified. A wide range of problems are covered in the personnel research such as:-  Wage survey  Effectiveness of various recruitment sources  Test validation  Effectiveness of training efforts  Supervisor’s effectiveness survey  Recent labour settlements  Job analysis  Job satisfaction survey  Survey of employee needs  Performance appraisal validation  Attitude survey towards reward system  Areas of high accident frequency  Turnover analysis  Customer complaints survey
  • 23. Reasons for discouraging unionization by employers Employers may discourage unionization. Their fear about unions stem from:-  Increased cost because of higher remuneration and other non- monetary benefits and services.  Loss of freedom to reward superior performance.  Loss of control over operations- erosion of management’s authority.  Lack of ability to adapt quickly to changing demands
  • 24. Introduction of Trade Union Employees associations are popularly known as trade unions in IR. Trade unions are not confined to mere striking and negotiating on behalf of workers. Their role is wider. Unions may take their presence felt in recruitment and selection. They may also decide who is to be hired and under what conditions. Unions can also play an important role in deciding who is to be promoted, given a new job assignment, sent for training, terminated or laid off. Many programs which contribute to QWL and productivity are undertaken by the management in consultation with and with the co- operation of the unions Unions decide wage and salary structure and negotiate revision once in 3/5 years.
  • 25. Definition of Trade Union Trade unions are voluntary organizations of workers formed to promote and protect their interest through collective action. The Trade Union Act, 1926 defines a Trade union as combination, whether temporary or permanent, formed-  Primarily for the purpose of regulating the relation between a. Workmen and employers. b. Between workmen and workmen. c. Between employers and employers.  For imposing restrictive conditions on the conduct of any trade or business and includes any federation of two or more trade unions.
  • 26. Characteristics of Trade Unions  Association:- A trade union is an association or combination of employees. It has large number of worker members from one or more occupations.  Voluntary :- Membership of a trade union is voluntary. Generally, there is no legal or other pressure to join a trade union and a person can join or leave the union on his free will.  Permanent :- A trade union is a continuing or permanent combination rather then a temporary or casual combination. It has to be a long- term body as otherwise it cannot achieve its objectives.  Union of common interest:- Members of a trade union have common interests and problems, which motivates them to unite. A union seeks to regulate relations between employers and workers.
  • 27.  Collective action:- Trade unions always act through united action by the members to protect and promote their economic and other interests.  Sub- systems:- A trade union is sub- system of the social system. Therefore its character undergoes change with changes in economic, social, legal and political conditions in the country. A union functions collectively to protect and promote the interests of its members within a given socio- economic system together unified body.
  • 28. Objectives of Trade Unions Following are the objectives of trade unions:-  To secure for the workers fair wages in the light of the changing cost of living and prevailing standards of living.  To improve working conditions by securing shorter working hours, better leave facilities, adequate social security, better housing and education and other welfare benefits.  To assure the workers a share in the increased profitability of industry through payment of adequate bonus.  To ensure security of employment by resisting retrenchment.  To protect workers against exploitation and victimization by the capitalists.  To protect the larger interest of society by assisting in the improvement of trade and industry.
  • 29. Why workers join Trade Unions? Workers organize themselves into a trade union due to the following reasons:-  Steady employment:- Workers form a trade union to secure their services. Unions take political action to get legislative protection against dismissal. They also resist any attempt of the employer to retrench workers.  Economic benefits:- An individual worker is not in a position to secure good pay and proper working conditions from the employer. Worker join union because union has great bargaining power to get these economic benefits for workers.  Check on arbitrary actions:- If workers are not united, an employer may adopt arbitrary policies and procedures to exploit them. Workers form unions to ensure rational and uniform personal policies and their unbiased implementation on the part of management.
  • 30.  Economic security:- Unions protect their members from various possible economic hazardous such as illness, accidental injury, unemployment. They contact employers to pay compensation and retirement benefits. Unions also have funds to provide financial support to distressed members.  Self- expression:- Workers join unions to communicate with management. Union serves as a platform through which a worker can make his voice heard by the employer.  Sense of belonging:- By joining the union worker can associate with fellow workers and gain social respect. He can also discuss his problems with trade union leader. Trade union generate a sprit of self-reliance and self respect among workers.
  • 31.  Recognition and participation:- workers can gain recognition as equal partners with employer by joining unions. They can participate in management of industry. They can influence decisions, affecting their interests, through collective bargaining.  Industrial relations:- Another reason for workers to join a union is the need for an adequate machinery to maintain proper relations between management and labour. Union provides this machinery through collective action.  Leadership :- Some workers join trade unions to fulfill their political ambitions. They can use the union as the stepping stone to become leaders. They may rise in their political career by obtaining an officer of the union.
  • 32. Functions of trade unions  Protection of workers  Proper standard of living  Grievance redressal  Collective bargaining  Participation  Protests  Education  Welfare and recreation  Legislation  Representation  Advice  communication
  • 33. Functions relating to Industrial organizations  To highlight industrial organization as a joint enterprise between workers and management and to promote identity of interest.  To increase production quantitatively as well as qualitatively, by laying down the norms of production and ensuring their adequate observance.  To help in maintenance of discipline.  To create opportunities for workers participation in management and to strengthen labour management co- operation.  To create favorable opinion of the management towards trade unions and improve their status in industrial organization.  To impress upon the management the need to adopt reformative and not punitive, approach towards workers fault.
  • 34. Functions relating to trade unions organization  To formulate policies and plans consistent with those of the industrial organization and society at large.  To improve financial position by fixing higher subscription, by realizing the union dues and by organizing special fund raising campaigns.  To train members to assume leadership position.  To keep away from advocating the adoption of unfair practices.  To save the union organization from the exploitation by vested interests personal and political.  To publicize the trade union objectives and functions, to know people’s reaction towards them and to make necessary modifications.
  • 35. Functions relating to society  To render all sorts of constructive co- operation in the formulation and implementation of plans and policies relating to national development.  To actively participate in the development of programs of national development.  To launch social campaign against social evils of corruption, casteism, regionalism, linguism, price rise, black marketing , smuggling, illiteracy, and disease etc.  To create public opinion favorable to governments policies and plans, and to mobilize people’s participation for the effective implementation.  To enable unorganized sector to organize itself.
  • 36. Types of trade unions • Craft union:- It is an organization of workers employed in a particular craft, trade or occupation. Therefore, such unions tend to be well cohesive.  Due to their identical training and skills, members of a craft union tend to develop unity among them.  Members are generally crafts concious rather than class concious.  A craft union has strong bargaining power because its workers possess a specialized skills which cannot be easily replaced in case of a strike.  But sometime due to different agreement in different crafts, joint action by workers belonging to different crafts in not easily possible.  Craft unions tend to oppose technological advancements.  Craft unions are horizontal in character because their members belong to a single process or group of processes.  In India, crafty unions are found largely among white-collar workers and professional such as Government employees, bank employees, doctors, lawyers, teachers etc.  There are very few craft unions of industrial workers.
  • 37. • Industrial unions:- An industrial union is organized on an industry basis rather than a craft basis.  Its members belong to different crafts within the same industry.  Ahmedabad Textrile Labour Association, the Rashtriya Mill Mazdoor Sangh etcx.  These unions are vertical in nature because they consist of all type of workers in an industry.  Industrial unions are more powerful because they consist of both skilled and unskilled workers.  Such a union cuts across skill and craft distinctions of workers.  It is easier for the employer to bargain with one union to cover all workers of a particular industry.  Worker is saved of the trouble of bargaining with a number of unions established on a craft basis.  However, skilled workers may feel swamped by unskilled workers and their specific demands may not be met  In these days, technological and mass production have obliterated the craft distinctions and therefore, industrial unions are the need of the hour.
  • 38. • General union:- This type of union consists of workers employed in different industries and crafts within a particular city or region. The Jamshedpur Labour Union is the example. In India there are several industry cum region unions due to the concentration of some industries in particular regions. • Federations:- These are national level bodies to which plant level unions, crafts unions, industrial unions and general unions are affiliated. Federations are the apex organizations of workers. They act as coordinating agencies. These are also called central trade unions
  • 39. Central trade unions in India  Indian National Trade Union Congress(INTUC), 1947  All India Trade Union Congress (AITUC), 1920  Center of Indian Trade Unions (CITU), 1970  Bhartiya Mazdoor Sangh (BMS), 1955  Hind Mazdoor Sabha (HMS), 1948  United Trade Union Congress (UTUC),1971  Hind Mazdoor Kishan Panchayat (HMKP), 1962  National Front of Indian Trade Unions (NFITU) , 1967
  • 40. Collective Bargaining • Collective bargaining is a procedure by which the terms and conditions of workers are regulated by agreement between their bargaining agents and employers. • The basic objective of collective bargaining is to arrive at an agreement on wages and other conditions of employment. • The underlying idea of collective bargaining is that the employer and employee relations should not be decide unilaterally or with the intervention of any third party. • Both parties must reconcile their difference voluntarily through negotiations, yielding some concessions and making sacrifices in the process. • Both parties have, more or less, realized the importance of peaceful coexistence for their mutual benefit and continued progress.
  • 41. • Industrial bargaining has three approaches- I. Unilateral approach in which the employer alone decides the terms and conditions of employment. This is known as individual bargaining. II. Bilateral approach in which the employer and worker negotiate with each other. When worker men/ their association and their representatives negotiate with one another, it is known as bipartite collective bargaining. III. Tripartite approach in which besides the two main parties, a third party also intervenes to facilitate settlement. • Collective bargaining is a process of joint decision making, a democratic way of life in industry. it establishes a culture of bipartism and joint consultations for establishing industrial harmony.
  • 42. Definition of collective bargaining  It is called “collective” because both employers and workers act as a group rather than as individuals, and it is described as “bargaining” because the method of reaching an agreement involves approach proposals and current proposals, offers and counter- offers and a give and take approach.  According to ILO it is defined as, “ negotiations about working conditions and terms of employment between an employer and one or group of employers or one or more employees organization. On the one hand, and one or more representatives of worker’s organizations on the other, with a view to reaching agreement.”  Collective bargaining is a continuous process of solving problems, on the principle of give and take and balance of power.
  • 43. Features of collective bargaining • Collective :- It is collective in two ways. One is that all the workers collectively bargain for their common interests and benefits. Second is that workers and management jointly arrive at an amicable solution through negotiation. • Strength:- Across the table both parties bargain from a position of equal strength. It is industrial democracy at work. • Flexible:- it is a group action where representatives of workers and management expend energies in order to arrive at a consensus. This is the unique feature of collective bargaining is that usually the parties concerned start negotiations with entirely divergent views but finally reach a middle point acceptable to both. It is a give and take process. • Voluntary:- Both workers and management come to the negotiating table voluntarily in order to have a meaningful view on various troubling issues. They try to probe each other’s views thoroughly before arriving at an acceptable solution.
  • 44. • Continuous :- It is a continuous process. It does not commence with negotiations and end with an agreement. The agreement is only a beginning of collective bargaining . It is a continuous process which includes implementation of the agreement and also further negotiations. • Dynamic:- It is a dynamic process because the way agreements are arrived at , the way they implemented the mental make – up of parties involved keeps changing. As a result, the concept itself changes, grows and expands over time. • Power relationship :- Workers want to gain the maximum from management and management wants to extract the maximum from workers by offering as little as possible. To reach a solution, both have to retreat from such positions and accept less than what is asked for and give more than what is on offer. By doing so management tries to retain its control on work place matters and unions attempt to strengthen their hold over workers without any serious dilution of their powers.
  • 45. • Representation:-The chief participants in collective bargaining do not act for themselves. They represent the claims of labour and management while trying to reach an agreement. • Bipartite process :-The employers and the employee negotiate the issues directly, face to face or across the table. There is no third party intervention.
  • 46. Objectives of collective bargaining  To settle disputes relating to wages and working conditions.  To protect the interests of workers through collective action.  To resolve the differences between workers and management through voluntary negotiations and arrive at a consensus.  To avoid third party intervention in matters relating to employment.
  • 47. Types of bargaining • Conjunctive bargaining :- The parties try to maximize their respective gains. They to settle economic issues such as wages, benefits, and bonus etc through a zero sum game. Unions negotiate for maximum wages. Management wants to yield as little as possible- while getting things done through workers. • Co-operative bargaining:- When companies are hit by recession. They can not offer the kind of wages and benefits demanded by workers. At the same time they cannot survive without the worker’s support. Both parties realize the importance of surviving in such difficulty and are willing to negotiate the terms of employment in a flexible way. Labour may accept a cut in wages in return for job security and higher wages when things improve. Management agrees to modernize and bring in new technology and invest in marketing efforts in a phased manner.
  • 48. • Productive bargaining :- In this method worker’s wages and benefits are linked to productivity. A standard productivity index is finalized through negotiations initially. Workers do not have to perform at exceptionally high levels to beat the index. If they are able to exceed the standards productivity norms workers will get substantial benefits. A management gain control over work place relations and is able to tighten the norms still further in future negotiations. • Composite bargaining:- In this method labour bargains for wages as usual but goes a step further demanding equity in matters relating to work norms, employment levels, manning standards, environmental hazards, sub- contracting clauses etc. Through composite bargaining unions are able to prevent the dilution of their powers and ensure justice to workers by putting certain limits on the freedom of employers. For the employer this is lesser evil when compared to strike and lockouts.
  • 49. Process of collective bargaining Process of collective bargaining involves the following stages:- • Step I: Pre-Negotiation Phase :- This is the stage before starting collective bargaining. At this stage, the management wants to estimate the power and capacity of labor unions. At this stage, all the relevant data, information and figures are collected so that the stage may be prepared for negotiation. • Step II : Selection of Negotiators:- at this stage, both the management and labour unions select their representatives who will take part in negotiations from their side. Only such persons are selected as negotiators who are fully acquainted with the problems on which negotiations are going to be held.
  • 50. • Step III : Strategy of Bargaining :- Management should decide the basic strategies and policies that will be followed at the time of bargaining with employees. Every thing must be made clear before going to the bargaining table. In addition to this, the management should get due powers to enter into agreements with workers. Similarly, labor unions should also determine the strategies on the basis of which they will take part in negotiation. • Step IV : Tactics of Bargaining :- The technique of collective bargaining depends upon the principle of “Give and Take”. Both the parties try to get more than they sacrifice. All the aspects of contracts are discussed in details. After this, the decisions are resolved and reviewed. The services of government mediators can also be used if required.
  • 51. • Step V : Contract :- fifth stage of the process of collective bargaining is to enter into a collective agreement. Such agreements are made for a certain time these agreements give full details of security of job, grievance handling procedure, promotion policy, transfer policy, rules regarding layoff, rules regarding retrenchment, hour of work, rules regarding leaves, incentive schemes, security and health, managerial liability etc • Step VI : Implementation of the contract : The last stage of the process of collective bargaining is the implementation of the agreements entered into between management ad labor unions. Both the parties should honor these agreements implement them whole heartedly.