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Industrial Relations

There is no unanimity on the meaning and scope of Industrial Relations since dierentterms, such as Labor Management Relations, Employer Employee Relations, nionManagement Relations and !uman Relations, are in use and are used synonymously" In itsstrictest sense, the term Industrial Relations means relationship bet#een management and#or$men in a unit or an industry" In its #ider connotation, it means the organi%ation andpractice of multi pronged relationships bet#een #or$ers and management, unions and

management in an industry"

The relationship bet#een employer and employee or trade unions is called Industrial Relation"!armonious relationship is necessary for both, the employer and the employees to safeguardtheir interests" In order to maintain good relationship #ith the employees, the main functionsof e&ery organi%ation should be to a&oid any dispute #ith them or settle it as early as possibleso as to ensure industrial peace and higher producti&ity"

Few Features of Industrial Relations

Industrial Relation does not emerge in &acuum' they are born from employment relationshipin an industrial setting" (ithout the e)istence of the t#o parties, i"e" labor and management,

this relationship cannot e)ist" It is the industry, #hich pro&ides the en&ironment for industrialrelations"

Industrial Relations are characteri%ed by both con*ict and co+operations" This is the basis ofad&erse relationship" o the focus of Industrial Relations in on the study of the attitudes,relationships, practices and procedure de&eloped by the contending parties to resol&e or atleast minimi%e con*icts"

-s the labor and management do not operate in isolations but are parts of large system, sothe study of Industrial Relation also includes &ital en&ironment issues li$e technology of the#or$place, country.s socio + economic and political en&ironment, nation.s labor policy,attitude of trade unions #or$ers and employers"

Industrial Relation also in&ol&es the study of conditions conducti&e to the labor management co+operations as #ell as the practices and procedures re/uired to elicit thedesired co operation from both the parties"

Industrial Relations also study the la#s, rules, regulation agreements, a#ards of courts,customs and traditions, as #ell as policy frame#or$ laid do#n by the go&ernment for elicitingco operations bet#een labor and management" 0esides this, it ma$es an in depth analysisof the interference patterns of the e)ecuti&e and 1udiciary in the regulations of labor managements relations"

2b1ecti&es of Industrial Relation To safeguard the interest of both the labor and managementby enlisting their co operation To facilitate production and producti&ity To achie&e a sound,

harmonious and mutually bene3cial labor management relations To a&oid unhealthyatmosphere in the industry, especially #or$ stoppages, go slo#s, gheraos, stri$es, loc$outsTo establish and maintain industrial democracy

Main -spect of Industrial Relations Labor Relations, i"e" relations bet#een union andmanagement Employer employees relations i"e" relation bet#een management andemployees 4roup relations i"e" relation bet#een &arious groups of #or$men 5ommunity or6ublic relations, i"e" relation bet#een industry and society 6romotions and de&elopment ofhealthy labor management relations Maintenance of industrial peace and a&oidance ofindustrial stri$e 7e&elopment of true industrial 7emocracy

Values in Industrial Relations

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Industrial Relation is not an 8ob1ecti&e. science" It is concerned #ith sub1ecti&e, &alue1udgments about concepts for #hich there are no uni&ersally accepted criteria"

Fairness and Equity: -lthough the concept of 8fairness. or 8e/uity. implicitly underlines theentire conduct of Industrial Relations, it is e)plicitly most fre/uently associated #ithconsiderations of salary dierentials and termination of the contract of employment" E/uitycan be &ie#ed from 9 perspecti&es" They are as follo#s Indi&idual E/uity is the perception ofindi&idual employee about the fairness of the employer in compensating him commensurate

#ith his s$ills and contribution" Internal E/uity is the perception of the employee about thefairness of the employer in compensating him relati&e to other employees #ho are similarlyplaced in terms of $no#ledge, e)perience, s$ill and performance" E)ternal E/uity is theperception of employees as to the fairness of their employer in compensating them relati&e to#hat is being paid for similar le&el of $no#ledge and s$ills by other organi%ations in theregion"

Power and Equity: 5oncept of 8po#er. and 8authority. occupy a central position inIndustrial Relations" The employment relationship is inherently a 8po#er;authority.relationship" The e)pressions 8po#er. and 8authority. though used interchangeably, aredierent" 6o#er is a #ider concept and can be de3ned as the ability to in*uence others,#hereas authority means the formal po#er possessed by, or delegated to a person by &irtue

of the o

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Importance of Industrial Relations

The healthy industrial relation is a $ey to the progress" Their signi3cance may be discussed asunder

!ninterrupted Production: The most important bene3t of industrial relations is that thisensures continuity of production" This means, continuous employment for all from manager to#or$ers" The resources are fully utili%ed, resulting in the ma)imum possible production" There

is uninterrupted *o# of income for all" mooth running of an industry is of &ital importance forse&eral other industries' to other industries if the products are intermediaries or inputs' toe)porters if these are e)port goods' to consumers and #or$ers, if these are goods of massconsumption"

Reduction in Industrial "isputes: 4ood industrial relations reduce the industrial disputes"7isputes are re*ections of the failure of basic human urges or moti&ations to secure ade/uatesatisfaction or e)pression #hich are fully cured by good industrial relations" tri$es, loc$outs,go+slo# tactics, gherao and grie&ances are some of the re*ections of industrial unrest #hichdo not spring up in an atmosphere of industrial peace" It helps promoting co+operation andincreasing production"

#igh $orale: 4ood industrial relations impro&e the morale of the employees" Employees#or$ #ith great %eal #ith the feeling in mind that the interest of employer and employees isone and the same, i"e" to increase production" E&ery #or$er feels that he is a co+o#ner of thegains of industry" The employer in his turn must reali%e that the gains of industry are not forhim along but they should be shared e/ually and generously #ith his #or$ers" In other #ords,complete unity of thought and action is the main achie&ement of industrial peace" It increasesthe place of #or$ers in the society and their ego is satis3ed" It naturally aects productionbecause mighty co+operati&e eorts alone can produce great results"

$ental Revolution:The main ob1ect of industrial relation is a complete mental re&olution of#or$ers and employees" The industrial peace lies ultimately in a transformed outloo$ on thepart of both" It is the business of leadership in the ran$s of #or$ers, employees and

4o&ernment to #or$ out a ne# relationship in consonance #ith a spirit of true democracy"0oth should thin$ themsel&es as partners of the industry and the role of #or$ers in such apartnership should be recogni%ed" 2n the other hand, #or$ers must recogni%e employer.sauthority" It #ill naturally ha&e impact on production because they recogni%e the interest ofeach other"

%ew Programs: ?e# programs for #or$ers de&elopment are introduced in an atmosphere ofpeace such as training facilities, labor #elfare facilities etc" It increases the e

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Economic 'atisfaction of &or(ers: 6sychologists recogni%e that human needs ha&e acertain priority" ?eed number one is the basic sur&i&al need" Most of the men are dominatedby this need" Man #or$s because he #ants to sur&i&e" This is all the more for underde&elopedcountries #here #or$ers are still li&ing under subsistence conditions" !ence economicsatisfaction of #or$ers is another important prere/uisite for good industrial relations"

'ocial and Psychological 'atisfaction: Identifying the social and psychological urges of#or$ers is a &ery important step in the direction of building good industrial relations" - man

does not li&e by bread alone" !e has se&eral other needs besides his physical needs #hichshould also be gi&en due attention by the employer" -n organi%ation is a 1oint &enturein&ol&ing a climate of human and social relationships #herein each participant feels that he isful3lling his needs and contributing to the needs of others" This supporti&e climate re/uireseconomic re#ards as #ell as social and psychological re#ards such as #or$ers. participationin management, 1ob enrichment, suggestion schemes, redressal of grie&ances etc"

)* + the + ,ob Conditions: -n employer employs a #hole person rather than certainseparate characteristics" - person.s traits are all part of one system ma$ing up a #hole man"!is home life is not separable from his #or$ life and his emotional condition is not separatefrom his physical condition" !ence for good industrial relations it is not enough that the#or$er.s factory life alone should be ta$en care of his o+the+1ob conditions should also be

impro&ed to ma$e the industrial relations better"

Enlightened rade !nions: The most important condition necessary for good industrialrelations is a strong and enlightened labor mo&ement #hich may help to promote the statusof labor #ithout harming the interests of management, nions should tal$ of employeecontribution and responsibility" nions should e)hort #or$ers to produce more, persuademanagement to pay more, mobili%e public opinion on &ital labor issues and help 4o&ernmentto enact progressi&e labor la#s"

%egotiating '(ills and -ttitudes of $anagement and &or(ers: 0oth management and#or$ers. representation in the area of industrial relations come from a great &ariety ofbac$grounds in terms of training, education, e)perience and attitudes" These &arying

bac$grounds play a ma1or role in shaping the character of industrial relations" 4enerallyspea$ing, #ell+trained and e)perienced negotiators #ho are moti&ated by a desire forindustrial peace create a bargaining atmosphere conduci&e to the #riting of a 1ust ande/uitable collecti&e agreement" 2n the other hand, ignorant, ine)perienced and ill+trainedpersons fail because they do not recogni%e that collecti&e bargaining is a di

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to gi&e emotional release to their dissatisfaction' and It acts as a chec$ and balance uponarbitrary and capricious management action"

/etter Education: (ith rising s$ills and education, #or$ers. e)pectations in respect ofre#ards increase" It is a common $no#ledge that the industrial #or$er in India is generallyilliterate and is misled by outside trade union leaders #ho ha&e their o#n a)e to grind" 0etter#or$ers. education can be a solution to this problem" This alone can pro&ide #or$er #ith aproper sense of responsibility, #hich they o#e to the organi%ation in particular, and to the

community in general"

%ature of Industry: In those industries #here the costs constitute a ma1or proportion of thetotal cast, lo#ering do#n the labor costs become important #hen the product is not anecessity and therefore, there is a little possibility to pass additional costs on to consumer"uch periods, le&el of employment and #ages rise in decline in employment and #ages" Thisma$es #or$ers unhappy and destroys good industrial relations"

Industrial Relations in India

India #as greatly ad&anced in the 3eld of industry and commerce in the past, as e&idencedfrom its ancient literature" In ancient times, the highest occupation in our country #as

agriculture follo#ed by trading" Manual ser&ices formed the third rung of occupation" mallmanufacturers in their cottages, mostly on hereditary basis, carried on a large number ofoccupations" -ncient scriptures and la#s of our country laid emphasis on the promotion andmaintenance of peaceful relations bet#een capital and labor" @rom the &ery early days,craftsmen and #or$ers felt the necessity of being united" The utility of unions has been statedin u$la Aa1ur&eda amhita, if men are united, nothing can deter them" Bautilyas.s-rthashastra gi&es a comprehensi&e picture of the organi%ation and functions of the socialand political institutions of India and a good description of unions of employees, craftsmen orartisans" There #ere #ell+organi%ed guilds, #hich #or$ed according to their o#n byela#s forthe management of the unions" !o#e&er, there #ere no organi%ations of #or$ers during theMughal rule" The laborers #ere entirely dependent on their masters and forced #or$ #asta$en from them" !istorical e&idence further sho#s the e)istence of rules of conduct and

prescribed procedure for the settlement of disputes for promoting cordial relations bet#eenthe parties" The #or$ing relations, ho#e&er, in those days #ere more or less of a personalcharacter and are &ery much distinguishable from the present+day industrial relations as ha&egradually de&eloped #ith the gro#th of large scale industries"

Phases of Industrial Relations in India

- study of modern industrial relations in India can be made in three distinct phases" The 3rstphase can be considered to ha&e commenced from the middle of the nineteenth century andended by the end of the @irst (orld (ar" The second phase comprises the period thereafter tillthe attainment of independence in CDF, and the third phase represents the post+independence era"

First Phase

7uring the 3rst phase, the 0ritish 4o&ernment in India #as largely interested in enforcingpenalties for breach of contract and in regulating the conditions of #or$ #ith a &ie# tominimi%ing the competiti&e ad&antages of indigenous employers against the 0ritishemployers" - series of legislati&e measures #ere adopted during the latter half of thenineteenth century, #hich can be considered as the beginning of industrial relations in India

The close of the @irst (orld (ar ga&e a ne# t#ist to the labor policy, as it created certainsocial, economic and political conditions that raised ne# hopes among the people for a ne#social order" There #as intense labor unrest because #or$ers. earnings did not $eep pace

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#ith the rise in prices and #ith their aspirations" The constitutional de&elopments in India ledto the election of representati&es to the 5entral and 6ro&incial legislatures #ho too$ a leadingrole in initiating social legislation" The establishment of International Labor 2rgani%ation =IL2>in CDCD greatly in*uenced the labor legislation and industrial relations policy in India" Theemergence of trade unions in India, particularly the formation of -ll India Trade nion5ongress =-IT5> in CDGH #as another signi3cant e&ent in the history of industrial relations inour country"

'econd Phase

The policy after the @irst (orld (ar related to impro&ement in the #or$ing conditions andpro&ision of social security bene3ts" 7uring the t#o decades follo#ing the #ar, a number ofla#s #ere enacted for the implementation of the abo&e policy" The Trade 7isputes -ct, CDGDsought to pro&ide a conciliation machinery to bring about peaceful settlement of disputes"

The Royal 5ommission on Labor =CDGD+ 9C> made a comprehensi&e sur&ey of labor problemsin India, particularly the #or$ing conditions in the conte)t of health, safety, and #elfare of the#or$ers and made certain recommendations of far+reaching conse/uences"

The econd (orld (ar ga&e a ne# spurt in the labor 3eld" The e)igencies of the #ar made itessential for the go&ernment to maintain an ade/uately contented labor force for ma)imi%ing

production" The 4o&ernment of India had, therefore, to step in and assume #ide po#ers ofcontrolling and regulating the conditions of #or$ and #elfare of industrial #or$ers" Itembar$ed upon a t#o+fold action in this regard, namely,

tatutory regulation of industrial relations through the 7efense of India 0ringing all theinterests together at a common forum for shaping labor policy

Tripartite consultati&e system #as one of the most important de&elopments in the sphere ofindustrial relations in our country" Tripartite consultation epitomises the faith of India in theIL2.s philosophy and ob1ecti&es" The Royal 5ommission on Labor recommended the need fortripartite labor machinery on the pattern of IL2 as early as CD9C" 0ut the 3rst step in thisdirection #as ta$en only in the year CDG, #hen the 3rst tripartite labor conference #as held

at ?e# 7elhi under the 5hairmanship of 7r" 0"R" -mbed$ar" The conference consisted of t#oorgani%ations, namely, the Indian Labor 5onference =IL5> and the tanding Labor 5ommittee=L5>" In the state sphere, tate Labor -d&isory 0oards #ere also set up for consultation onlabor matters" 4radually, tripartism de&eloped into a full+*edge system, a $ind of parliamentfor labor and management"

The ob1ecti&es set before the t#o tripartite bodies at the time of their inception in CDG #ere:6romotion of uniformity in labor legislation' Laying do#n of a procedure for the settlement ofindustrial disputes' and 7iscussion of all matters of -ll+India importance as bet#eenemployers and employees"

The IL5;L5 has immensely contributed in achie&ing the ob1ecti&es set before them" Theyfacilitated enactment of central legislation and enabled discussion on all labor matters of

national importance" 7ierent social, economic and administrati&e matters concerning laborpolicies and programs #ere discussed in the &arious meetings of IL5;L5"

hird Phase

-fter independence, an Industrial Truce Resolution #as adopted in CDF at a tripartiteconference" The conference emphasi%ed the need for respecting the mutuality of interestsbet#een labor and capital" It recommended to the parties the method of mutual discussion ofall problems common to both, and settles all disputes #ithout recourse to interruption in orslo#ing do#n of production"

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The post+independence period of industrial relations policy aimed at the establishment ofpeace in industry, and grant of a fair deal to #or$ers" The go&ernment sought to achie&ethese aims through appropriate labor legislation, labor administration, and industrialad1udication" tate inter&ention in industrial relations #as 1usti3ed on the ground that ithelped to chec$ the gro#th of industrial unrest" !o#e&er, it #as noticed that the spirit oflitigation gre# and delays attendant on legal processes ga&e rise to #idespreaddissatisfaction" !ence, since CDJ a ne# approach #as introduced to counteract theunhealthy trends of litigation and delays in ad1udication" Its emphasis #as based on theprinciples of industrial democracy, on pre&ention of unrest by timely action at the appropriatestages, and gi&ing of ade/uate attention to root causes of industrial unrest"

(hile the ground#or$ of labor policy #as prepared during the forties, a superstructure on thisground#or$ #as built in the 3fties" It is the 5onstitution of India and the 3&e+year plans, #hichlargely helped in raising the superstructure" The 6reamble to the 5onstitution and the chapteron 7irecti&e 6rinciples of tate 6olicy enunciate the elements of labor policy" The successi&e3&e+year plans since CDC clearly enunciated the directions of industrial relations policy"

These entailed the building up of industrial democracy in $eeping #ith the re/uirements of asocialist society, #hich sought to be established through a parliamentary form of go&ernment"

/rief -ccount of the Industrial Relations Policy during Five01ear Plans

The approach to labor problems in the @irst @i&e+Aear 6lan =CDC+K> #as based onconsiderations #hich #ere related, on the one hand, to the re/uirements of the #ellbeing ofthe #or$ing class, and on the other, to its &ital contribution to the economic stability andprogress of the country" It considered the #or$er as the principal instrument in theful3llment of the targets of the 6lan and in the achie&ement of economic progress" @urther,the 6lan stated that harmonious relations bet#een capital and labor are essential for thereali%ation of the 6lan in the industrial sector" The 6lan emphasi%ed that the #or$ers. right ofassociation, organi%ation and collecti&e bargaining should be accepted #ithout reser&ation asthe fundamental basis of the mutual relationship and the trade unions should be #elcomedand helped to function as part and parcel of the industrial system

Much of #hat had been said in regard to industrial relations in the @irst 6lan #as reiterated inthe econd @i&e+Aear 6lan =CDK+KC>" The econd 6lan considered a strong trade unionmo&ement to be necessary both for safeguarding the interests of labor and for realising thetargets of production" Multiplicity of trade unions, political ri&alries, lac$ of resources, anddisunity in the ran$s of #or$ers #ere, according to the 6lan document, some of the ma1or#ea$nesses in a number of e)isting unions" The importance of pre&enti&e measures forachie&ing industrial peace #as particularly stressed and greater emphasis #as placed on thea&oidance of disputes at all le&els" It also emphasi%ed on the increased association of labor#ith management"

The Third @i&e+Aear 6lan =CDKC+KK> e)pressed great hopes in the &oluntary approach initiatedduring the econd 6lan period to gi&e a more positi&e orientation to industrial relations, based

on moral rather than legal sanctions" The 6lan highlighted the need for increasing applicationof the principle of &oluntary arbitration in resol&ing dierences bet#een #or$ers andemployers and recommended that the go&ernment should ta$e the initiati&e in dra#ing uppanels of arbitrators on a regional and industry+#ise basis" @urther, the 6lan recommendedthat the #or$s committees should be strengthened and made an acti&e agency for thedemocratic administration of labor matters"

The @ourth @i&e+Aear 6lan =CDKD+F> suggested no changes in the system of regulating laborrelations by legislati&e and &oluntary arrangements started from earlier plans" It de&oted agood deal of attention to employment and training" It also laid stress on strengthening laboradministration for better enforcement of labor la#s, research in labor la#s, and e)pansion oftraining programs for labor o

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The @ifth @i&e+Aear 6lan =CDF+FD> laid great emphasis on employment, both in rural and urbansectors" -fter the promulgation of emergency in une CDF, the go&ernment de&ised a ne#pattern of bipartite consultati&e process in an attempt to create a climate of healthy industrialrelations, leading to increased production, by esche#ing lay+os, retrenchments, closures,stri$es and loc$outs" The ne# machinery sought to formulate policies at the national, state,and industry le&els for the speedy resolution of industrial con*icts and for promotingindustrial harmony" 7uring the emergency, the 4o&ernment of India through a resolutionadopted a scheme of #or$ers. participation in industry at shop and plant le&els on 9Hth2ctober, CDF"

The importance of cooperati&e attitude on the part of employers and employees for themaintenance of healthy industrial relations has been emphasi%ed in the i)th @i&e+Aear 6lan=CDJH+J>" -ccording to the plan, stri$es and loc$outs should be resorted to only in the laststage" Eecti&e arrangements should also be made for the settlement of inter+union disputesand to discourage unfair practices and irresponsible conduct" (hile suggesting the gro#th oftrade unions on healthy lines, the 6lan stressed on their social obligations and roles in manyareas of nation building acti&ities and in impro&ing the /uality of life of #or$ers" @urthermore,it emphasi%ed on necessary changes in the e)isting la#s on trade unions, industrial relationsand standing orders for promoting harmonious industrial relations"

The thrust of the e&enth @i&e+Aear 6lan =CDJK+DC> is on impro&ement in capacity utili%ation,e, labor participation in management is ameans of bringing about a state of industrial democracy" E&er since independence, thego&ernment has been stressing the need to introduce #or$ers. participation in management

and &arious schemes #ere noti3ed from time to time" !o#e&er, the results ha&e fallen farshort of e)pectations" The need to bring for#ard a suitable legislation for eecti&eimplementation of the scheme has been felt" 0esides legislation, proper education andtraining of #or$ers and cooperation from both employers and employees to o&ercomeproblems arising out of the e)istence of multiplicity of trade unions and inter+union ri&alry #illgo a long #ay in promoting the system of participati&e management"

-ccording to the ?inth @i&e+Aear 6lan =CDDF+GHHG>, the planning process attempts to createconditions for impro&ement in labor producti&ity and for pro&ision of social security tosupplement the operations of the labor mar$et" The resources ha&e been directed through theplan programs to#ards s$ill formation and de&elopment, e)change of information on 1obopportunities, monitoring of #or$ing conditions, creation of industrial harmony, and insurance

against disease and unemployment for the #or$ers and their families"

2overnment3s Role

The main issue in regard to the go&ernment.s role in industrial relations is the degree of stateinter&ention" In India, particularly after independence, the go&ernment has been playing acomprehensi&e and dominant role in shaping the pattern of industrial relations" In the mi)edeconomy of our country, the state has emerged as a big employer" The go&ernment e&ol&esthrough tripartite forums the norms or standards, #hich are in the nature of guidelinesshaping employer+employee relations" It accepts the responsibility of ensuring conformity tothese norms through the administrati&e and 1udicial mechanism" It enacts legislation on laborand implements both the substanti&e and procedural la#s"

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The industrial relations policy of the go&ernment forms part of the broader labor policy" Thetenets of this policy, as stated by the ?ational 5ommission on Labor, are:

6rimacy to the maintenance of industrial peace'

Encouragement for mutual settlement of disputes through collecti&e bargaining and&oluntary arbitration'

Recognition of the #or$ers. right to peaceful direct action, i"e", stri$e' and

Tripartite consultation

The state inter&ention primarily aims at preser&ing industrial peace and has, therefore,focused attention on: The a&oidance of industrial disputes' and The e)peditious settlement ofindustrial disputes #hen they arise"

The ad1udication and other regulati&e aspects of the role of the go&ernment continue to formthe core of industrial relations in India"

Current "evelopments

The current de&elopments in the 3eld of industrial relations are basically related to structuralchanges, ac/uisitions and mergers, globali%ation, liberali%ation, and technological changes"

tructural 5hanges

The main aspects of the structural changes ha&ing an impact on the industrial relationssystem in the country could be mentioned as:

6roduction reorgani%ation or decentrali%ed production ma$ing a thin organi%ed sectoremployment more thinner" The large+si%ed units shifted to *atter structures and opted fordecentrali%ed decision+ma$ing" These units reorgani%ed their production by trimming theirsi%e and carrying out production in multiple units or by e)ternali%ing their production, i"e",concentrating on core acti&ities #ith higher &alue addition, and subcontracting the other #or$production to other ancillary units" These measures of economic reforms ha&e distinctlyaected the industrial relations system in the country as it has limited its institutions andpractices to the formal organi%ed sector in the large+si%ed units" -s such, the system hascome under pressure to ad1ust and adapt to the challenges of gro#th of small and mediumunits and shift its employment in fa&or of unorgani%ed sector"

4lobali%ation and technological changes pro&ed disrupti&e for the system in terms ofdisplacement of labor, i"e", 1ob losses, destabili%ing the #age structure, and a shift ins$ill;occupation composition of labor"

-scendancy in managerial rights and the #ea$ening of trade unions ga&e greater *e)ibility tomanagement in utili%ation of labor and in handling industrial con*ict"

G9

Mergers and -c/uisitions

In merger, t#o or more e)isting companies go into li/uidation and a ne# company is formedto ta$eo&er their business" -n ac/uisition arises #hen there is a purchase by one company ofthe #hole or part of the shares, or the #hole or part of the assets, of another company inconsideration for payment in cash or by issue of shares or other securities in the ac/uiringcompany or partly in one form and partly in the other" The process of merger is the result ofagreement and contract bet#een the transferor and transferee companies"

The concept of mergers and ac/uisitions is &ery much popular in the current economicscenario" More so, it is a signi3cantly popular concept after CDDHs in India on the birth of

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economic liberali%ation and globali%ation" The basic premises for mergers and ac/uisitions arethe consolidation process for sur&i&al of e)isting underta$ings, and large groups absorbingthe small entities"

- series of personnel problems normally occur #hen one company ac/uires another" 6eopleaspect is &ery important in the process of ac/uisition"

The communications frame#or$ is the most important factor for smooth integration in an

ac/uisition" (ith eecti&e communication, the ac/uiring company can de&elop a climate ofcon3dence and, hopefully, eliminate much of the friction, #hich fre/uently occurs" 4oodcommunication is an essential part of good human relations" The labor relationsconsiderations #hen one company ac/uires another are union relations history,representation of employees in unions, history of #or$ stoppages, stri$es and loc$outs,grie&ance settlement, collecti&e bargaining and signing of agreements and settlements"

4lobali%ation

4lobali%ation can be conceptually e)plained as the process of economic or commercialintegration of a company or a country #ith the rest of the #orld" The magnitude of suchintegration #ill determine the e)tent of globali%ation accomplished by the company or the

country as the case may be" It is important to note that globali%ation is not an 8e&ent. but a8process".

G

ome segments of the labor force ha&e suered from the direct and indirect eects ofglobali%ation more than others" Increased trade and increased competition ha&e led to 1oblosses in the ad&anced economies, probably not too many in aggregate terms butconcentrated in lo#+s$illed labor intensi&e industries #ith high labor costs" In addition,organi%ational changes such as contracting out, and do#nsi%ing of permanent sta ha&eaected lo#+s$illed #or$ers more than high+s$illed #or$ers and ha&e contributed to #idening#age disparities =IL2, CDDF>

In the process of globali%ation the po#er of trade unions, as measured by trade+union density,has declined almost e&ery#here around the #orld, in de&eloped as #ell as in de&elopingcountries" E&idently, some other factors ha&e contributed to the e&olution of trade unionmembership such as the demise of state socialism in 5entral and Eastern Europe, the processof economic restructuring, and the shift from manufacturing to ser&ice employment"?e&ertheless, globali%ation as such has an impact on labor and labor relations, #hich hascontributed considerably to the signi3cant decline of trade+union density in general" 2nlysome de&eloping countries ha&e bene3ted from globali%ation" In many countries, includingthe ad&anced economies, income ine/uality and po&erty has gro#n considerably"

Technological 5hanges

The inter+relationship bet#een technological change and industrial relations time and againhas been the focus of attention of groups in society" Technology has an impact on labormanagement issues such as manpo#er, 1ob security, and training redundancy" -ll the threeparties in industrial relations are closely concerned #ith the eects of technology"

Technological change raises sensiti&e industrial relations issues, especially #here it in&ol&es#or$ intensi3cation, rationali%ation or reductions in employment" Industrial relations issues,especially relating to employment le&els and #or$ organi%ation, #ere seen as important indeciding upon ne# plant, machinery or e/uipment" Technological change aects the #or$en&ironment and alters the relationship bet#een the employers and employees" It aectslabor in t#o #ays, economic and social" The 3rst category consists of redundancy,occupational ad1ustment, allocation of gains, and transfer and retraining problems" The

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second category includes psychological factors such as resistance to change, 1ob satisfaction,and #or$er and union relations"

G

6ri&ati%ation

6ri&ati%ation is one of the ma1or elements of structural ad1ustment process ta$ing place in

dierent parts of the #orld" It in&ol&es comple) social and labor issues" -pprehensions aboutpri&ati%ation concern potential loss of present and future 1obs" !o#e&er, there is not enoughe&idence to suggest that pri&ati%ation per se destroys 1obs" The trade unions are concernedabout pri&ati%ation due to fears about 1ob loss and potential ad&erse eects on the dynamicsof trade unions and their rights"

Industrial Relations cenario

The econd ?ational 5ommission on Labor GHHG has made the follo#ing obser&ations aboutthe industrial relations scenario in India: It is increasingly noticed that trade unions do notnormally gi&e a call for stri$e because they are afraid that a stri$e may lead to the closure ofthe unit" er&ice sector #or$ers feel they ha&e become outsiders and are becomingincreasingly disinterested in trade union acti&ities" There is a trend to resol&e ma1or disputesthrough negotiations at bipartite le&el" The nature of disputes or demands is changing"Instead of demanding higher #ages, allo#ances or facilities, trade unions no# demand 1obsecurity and some are e&en #illing to accept #age cuts or #age free%es in return for 1obprotection" 7isputes relating to non+payment of #ages or separation bene3ts are on the rise"

The attitude of the 4o&ernment, especially of the 5entral 4o&ernment, to#ards #or$ers andemployers seems to ha&e undergone a change" ?o#, permissions for closure or retrenchmentare more easily granted" The conciliation machinery is more eager to consider problems ofemployers and today consider issues li$e increase in producti&ity, cost reduction, 3nancialdi

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The restructuring process, production reorgani%ation, and technology changes up gradationha&e made the problems of unemployment of labor more #idespread and acute" Thetraditional industrial relations system and its institutions and practices #ere most suited tothe tas$s of protecting and promoting the interests of #or$ers #ith secure permanentemployment" The challenge for the industrial relations system lies in #hether the ne# systemcan pro&ide for any alternati&e to the traditional system"

The focus of industrial relations has shifted from the region;industry le&el to the enterprise or

e&en plant le&el"

In the ne# production conte)t, the large si%ed 3rms ha&e declined and small and medium si%ed 3rms ha&e increased" Most of these 3rms remain beyond the pur&ie# of labor legislationand the organi%ations of labor in these scattered units are #ea$ and ineecti&e

GF

Trade nions

Trade union is an indispensable part of industrial sector in India" Trade unions playconstructi&e role by acting as a pressure group in a capitalism society" In fact trade unions actas an eecti&e platform for the #or$ers class to en1oy their due rights #ithout beinge)ploited" To strengthen the fundamental rights of &oiceless #or$ing class trade unions areoriginated" 4radually trade union got recognition from the authority and became a legallyappro&ed representation of labor mass"

(ith the ad&ancement of industriali%ation process, trade union related issues got morecomplicated and compelled the union go&ernment to enact more eecti&e la#s and -cts"-part to the principal -ct, no#adays many amendment -cts and la#s are enforced to ma$ethe trade nionism more systematic and constructi&e in approach" Those -cts include: TheIndian Trade nions =-mendment> -ct, CDGJ, CDKH, CDK and The 5entral Labor La#s=E)tension to ammu and Bashmir> -ct, CDFH"

Trade unions #ere 3rst de&eloped in Europe follo#ing the industrial re&olution in the mid CDth

century" To ma$e good pro3ts, employers adopted ad&erse practices such as long #or$inghours and lo# pay" In response to this e)ploitation, #or$ers 1oined together to 3ght forimpro&ed #or$ing conditions by means of collecti&e bargaining through the formation of tradeunions" Today trade unions function as #or$ers representati&es in and occupational healthha%ards"

Trade unions e)ert pressure on go&ernments and the international community to further theirinterests by supporting political policies and practices, sponsoring political parties andgo&ernment grie&ances resolution eorts and pro&ide mutual bene3ts and support to theirmembers" In addition they also act as pressure groups in campaigning for human and #or$ersrights, en&ironmental so as to push for representation in parliament"

6ost Independence Trade nions #ere formed because: 7issatisfaction #ith management?eed for social outlet ?eed for a&enues for leadership

GJ

@orced unioni%ation in organi%ations #here union membership is a prere/uisite foremployment ocial pressure from co+#or$ers

(ith the imperialist oensi&e of globali%ation and militari%ation continuing, the Indian tradeunion mo&ement faces the immense tas$ of mobili%ing people against the t#in danger" It is3rm opinion of 5IT that the trade unions ha&e a speci3c role to play on these issues" (e #illha&e to concentrate on the follo#ing issues" Eecti&e co+operation bet#een #orld trade

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unions and federations pecial eorts for building up unity and solidarity of trade unionmo&ement in the -sia, 6aci3c Region" Ideological 3ght against the imperialist oensi&e shouldbe strengthened by the e)posing their eorts through studies and e&aluations" -ll eortsshould be made to educate the #or$ers on the nature of the imperialist oensi&e ointcampaigns to be underta$en along #ith &arious trade union organi%ation and other massorgani%ations in the country olidarity and support actions for the people and the countries#ho are resisting imperialist oensi&e ha&e to be organi%ed at &arious le&els" (idest possibleunity of all the anti+imperialist and anti+#ar sections of people has to be built up andstrengthened

o Trade nion -cts in India pro&ide eecti&e guidelines for both the trade unions and theindustrialists"

Trade nion 6roblems Trade union leadership Multiple unions nion ri&alry @inance

GD

2ther problems #ere: Illiteracy ne&en gro#th Lo# membership !eterogeneous nature oflabor Lac$ of interest -bsence of paid o