nainy

LOVELY PROFESSIONAL UNIVERSITY

DEPARTMENT OF MANAGEMENT

SUMMER TRAINING REPORT

On

An Analytical Study of

Labour Turnover

In Vardhman

Submitted to Lovely Professional University

in partial fulfillment of the requirements for the degree of

Masters of Business Administration (MBA)

2010

Submitted by:

Nainy Sood

University R.No. RS1901A06

Department of Management


ACKNOWLEDGEMENT

Myself, Nainy Sood, student of two years Master of Business Administration course in

“Department of Management”, in Lovely Professional University for the partial fulfillment of

course, underwent a Summer Internship at “Vardhman Spinning And Textile Mills” for six

weeks.

For the same I would like to thank my project guide “Mr. Vineet Kashyap”, without whose

concern and efforts, this internship would never have been possible.

I am also highly grateful to “Mr. Manish Thakur”, Manager, HR Dept., who granted me the

permission to work as internee.

I would like to thank “Mrs. Deepika Sukhija”, my mentor and guide throughout the Internship,

who assisted me throughout my internship and made it a fine learning experience.

Apart from these, I would also like to thank the various workers and staff members who were

there to assist me at every step and to answer my queries.


TABLE OF CONTENTS

Summary

Objectives

How the study was made

Rationale of the study

Significance of the study

Industry profile

SWOT analysis

Current facts

Company profile

History

Mission

Philosophy

Portfolio

Labour turnover

Literature review

Research methodology

Analysis and interpretation

Results and findings

Suggestions

Conclusion

Questionnaire

References


SUMMARY

Productivity in construction frequently suffers as a result of high levels of absenteeism and

worker turnover. There is evidence that all concerned-owners, contractors, and workers--are

interested in resolving this problem. This study examines the source and size of the problem, and

makes recommendations to reduce it. For the most part, data for this study were collected from

workers and required the cooperation of owners and contractors. Without exception everyone

cooperated.

Some causes of absenteeism are uncontrollable. The major causes, however, are controllable.

They center on the work-site environment. Such de-motivators as excessive rework, poor

supervision, and unsafe working conditions are reported by workers to be more frequent reasons

for absenteeism than personal illness. These data suggest that absenteeism can be minimized if

managed. Well planned, safe jobsites where an effort is made to recognize workers' individual

skills and utilize employees accordingly will have less absenteeism and inherently enjoy a gain

in productivity.

Worker turnover is also a serious problem in construction and warrants attention. Poor

supervision, unproductive relationships with the boss, poor planning, and generally poor

management are the prime reasons cited by the workers for turnover. As in the case of

absenteeism, this too can be minimized by planning, supervising, and the application of good

management principles. Lower turnover offers a broad range of productivity gains. One other

significant cause of turnover is the attractiveness of nearby jobs offering extended overtime.

Absenteeism and turnover occur on every construction jobsite; however, there is no common

understanding or definition of either. The industry needs to focus on a common definition so that

relative performance may be used as a management guide.


OBJECTIVES

Human resource management has become one of the more important models of management

applied in the modern organisation. In this study, a closer look on the labour turnover in the

textile industry shall be made. This study intends to establish the relationship of the effective

implementation of human resource management and labour turnover in the industry. In order to

carry out this study, the researcher shall carry out the following objectives.

To find out the reason for the labour turnover.

To find out the satisfaction amongst the workers.

How do the workers regard the company’s performance in terms of:

• Training and Development

• Compensation

• Working Conditions

• Organisation and Productivity

• Empowerment and Employee Involvement

• Communication

• Management and Supervision

• Teamwork


HOW THE STUDY WAS MADE

The project shall carry out analysis of the possible causes of labour turnover in Vardhman

textiles and General Mills. The discussions shall be divided into five parts.

This first part basically forms part of the introductory elements of this paper. An introduction

to the general problem of turnover in the textile industry, a background of the current

environment of the said industry and the rationale why and how this general problem needs to be

addressed shall be indicated in this part. Hence, the first part shall build the foundation on which

the subsequent parts will relate.

The second part shall provide for the review of related literature pertaining to employee

retention, labour turnover and human resource management. On a more specific note, the

discussions shall fall squarely on how the existing literature points to the concepts and issues

mentioned in the aims and objectives of this project. Moreover, this part will also provide some

description of past studies that shows similarities with the intended ends of this project. These

discussions will then be used to relate to the actual findings of this study.

The third part of the project shall cover the methods and procedures used in this project.

Simply, the discussions on this part shall cover the models used in the data acquisition processes.

Statistical tools as well as other concerns which the researcher encountered during the course of

the study shall be taken into account. This is to provide a transparent account on how the data is

acquired and that the data used in the analysis are credible.

The fourth part shall present, interpret and analyse the data acquired from the respondent

company. In this part of the study, tables and charts shall be used to summarise the findings

made by the research process. Specifically, the processed data from the quantitative research

shall be discussed and related to the objectives of the project. In addition to that, the discussions

shall also relate the findings on the existing theories pointed out in the earlier literature review.

The last part shall be giving out the summary, conclusions and recommendations based on the

findings of presented in the preceding parts. In doing so, this part will specify the implications of

the study on the overall field of organisation and human resource management. The


recommendations given in this part shall cover the observations and arguments made throughout

the dissertation.

A questionnaire was made of 20 questions to identify reasons for absenteeism and turnover from

the worker's perspective. The questionnaire was designed specifically to measure worker

attitudes about their jobs and to investigate underlying causes for turnover. This questionnaire

was completed by more than 100 workers on their jobsite.

The final questionnaire was divided into two main parts. Part1 asked workers to respond to

questions about demographic items such as name, age, department, token number. Part 2 asked

for information about attitudes toward job factors— e.g., safety aspects, work quality,

supervision, and pay.


RATIONALE OF THE STUDY

Organisational studies have emphasised time and again of the importance of offsetting the

demands of the external environment with the internal environment of the organisation. This

harmony provides for the overall success of the organisation. The very manifestation of this

stated harmony is seen in the flexibility of the company in dealing with the demands of their

operations. The management and supervision of the environment is thus a given prerequisite.

The internal environment serves as foundation for the company in dealing with the nuances of

the external environment. However, this can only be done if the organisation holds on to a

competent set of workers and employees dedicated to the realisation of organisational goals. The

problem with this requirement is that this rarely takes place. Companies, after training their

employees to meet the standards that they require, do not stay too long in the organisation as they

seek other opportunities elsewhere. Studies have pointed out that employee turnover tends to

increase the costs incurred by the company and at the same time opens it up for significant

losses. This is compounded by the fact that turnover of employees has the propensity to be

driven by personal decisions of the individual employees. Studies have pointed to this

phenomenon as voluntary turnover. Acts like resignation and retirement are among those that

signify voluntary turnover. Hence, retention is deemed as an indispensable ends on which the

company has to achieve.


SIGNIFICANCE OF THE STUDY

In the past decades, the study on human resource management has become one of the most

contested and debated topics. Scholarly journals and academic articles have assailed every nature

of the model. In the same manner, a good number has been made for the purpose of analysing the

importance of retention and the effects of turnover. This report would be a welcome addition to

this existing literature. In addition, the analyses and findings of this report will fill in the rather

scant studies on the effects of turnover and the importance of retention in the industry.

In this regard, it is important to mention that the study will be focusing on a particular textile mill

in Ludhiana. Hence, the setting of the study will also establish the existing conditions

surrounding the textile industry.. This may trigger an impetus to further improve the knowledge

of the existing environment and the industry on which the respondent company operates. To this

end, the study will beneficial to a number of sectors in society. The implications of the findings

are not limited to organisational studies alone. It affords an advantage to the actual trade and

industry as well as in the academe.


INDUSTRY PROFILE

Indian Textile Industry is one of the leading textile industries in the world. Though was

predominantly unorganized industry even a few years back, but the scenario started changing

after the economic liberalization of Indian economy in 1991. The opening up of economy gave

the much-needed thrust to the Indian textile industry, which has now successfully become one of

the largest in the world.

India textile industry largely depends upon the textile manufacturing and export. It also plays a

major role in the economy of the country. India earns about 27% of its total foreign exchange

through textile exports. Further, the textile industry of India also contributes nearly 14% of the

total industrial production of the country. It also contributes around 3% to the GDP of the

country. India textile industry is also the largest in the country in terms of employment

generation. It not only generates jobs in its own industry, but also opens up scopes for the other

ancillary sectors. India textile industry currently generates employment to more than 35 million

people. It is also estimated that, the industry will generate 12 million new jobs by the year 2010.

Currently it is estimated to be around US$ 52 billion and is also projected to be around US$ 115

billion by the year 2012. The current domestic market of textile in India is expected to be

increased to US$ 60 billion by 2012 from the current US$ 34.6 billion. The textile export of the

country was around US$ 19.14 billion in 2006-07, which saw a stiff rise to reach US$ 22.13 in

2007-08. The share of exports is also expected to increase from 4% to 7% within 2012

Various Categories

Indian textile industry can be divided into several segments, some of which can be listed as

below:

Cotton Textiles

Silk Textiles

Woolen Textiles

Readymade Garments

Hand-crafted Textiles

Jute and Coir


SWOT ANALYSIS

STRENGTHS :

Indian Textile Industry is an independent & self-reliant industry.

Abundant raw material availability that helps industry to control costs

and reduces the lead-time across the operation.

Availability of low cost and skilled manpower provides competitive

advantage to industry.

Availability of large varieties of cotton fibre & has a fast growing

synthetic fibre industry.

India has great advantage in spinning sector and has a presence in all

process of operation & value chain.

India is one of the largest exporters of Yarn in international market &

contributes around 25% share of the global trade in Cotton Yarn.

The Apparel Industry is one of largest foreign revenue contributor &

holds 12% of the country’s total export.

Industry has large and diversified segments that provide wide variety

of products.

Growing economy and potential domestic & international market.

Industry has manufacturing flexibility that helps to increase the

productivity

WEAKNESSES:

Indian Textile Industry is highly fragmented industry.

Industry is highly dependent on Cotton.

Lower productivity in various segments.

There is decline in mill segment.

Lack of technological development that affect the productivity & other

activities in whole value chain.


Infrastructural bottlenecks and efficiency such as, transaction time at

ports and transportation Time.

Unfavourable labour laws.

Lack of trade membership, which restrict to tap other potential

market.

Lacking to generate economies of scale.

Higher indirect taxes, power and interest rates.

OPPORTUNITIES:

Growth rate of domestic textile industry is 6-8% per annum.

Large, potential domestic & international Market.

Product development and diversification to cater global needs.

Elimination of quota restriction leads to greater market development.

Market is gradually shifting towards branded readymade garment.

Increased disposable income & purchasing power of Indian customer

opens new market development.

Emerging retail industry and malls provide huge opportunities for the

apparel, handicraft & other segments of the industry.

Greater investment & FDI opportunities are available.

THREATS:

Competition from other developing countries, especially China.

Continuous quality improvement is need of the hour as there are

different demand patterns all over the world.

Elimination of quota system will lead to fluctuations in export demand.

Threat for traditional market for power loom & handloom products &

forcing them for product diversification.

Geographical disadvantages.


International labour & environmental laws.

To balance the demand & supply.

To make balance between price & quality

Current Facts on India Textile Industry

Indian Textile Industry is one of the largest and oldest industries in India.

India retained its position as world’s second highest cotton producer.

Acreage under cotton reduced about 1% during 2008-09.

The productivity of cotton which was growing up over the years has decreased in 2008-

09.

Substantial increase of Minimum Support Prices (MSPs).

Cotton exports couldn't pick up owing to disparity in domestic and international cotton

prices.

Imports of cotton were limited to shortage in supply of Extra Long staple cottons.

Indian Textile Industry is highly fragmented industry; at the same time it is an

independent and self-reliant industry that has shown sustainable growth over the years.

Indian textile Industry is valued at US$ 36 Billion with exports of US$ 17 Billion in

2005-2006.

Indian Textile Industry is second largest industry in terms of providing vast employment

opportunities and employs around 35 million people in country after agriculture sector.

The Indian Textile Industry plays vital role in economic development and contributes

14% to industrial production in the country.

Textile Industry contributes around 4% of GDP, 9% of excise collections, 18% of

employment in industrial sector, and has 16 % share in country’s export.

Industry has direct and strong linkage with rural and agriculture sector, therefore it is

estimated that, one of every six households in country is directly or indirectly dependent

on this industry.

Industry contributes around 25% share in the world trade of cotton yarn.

India is evolved as a major contributor in world’s cotton sector. Indian is the world’s

third-largest producer of cotton and second-largest producer of cotton yarns and textiles.


India is the largest exporter of yarn in the international market and has a share of 25% in

world cotton yarn export market.

India contributes for 12% of the world’s production of textile fibers and yarn.

Indian textile industry is second largest after China, in terms of spindlage, and has share

of 23% of the world’s spindle capacity.

India has around 6% of global rotor capacity.

The country has the highest loom capacity, including handlooms, and has share of 61% in

world loomage.

Including textiles and garments, 30% of India's export comes from this sector.

Indian Textile Industry is one of the largest industries that provides high exports and

foreign revenue.

Large and potential domestic & international market, large pool of skilled and cheap

labor, well-established industry, promising export potential etc. are few strengths of

Indian Textile Industry.

Highly Fragmented, High dependence on cotton sector, Lower productivity, Unfavorable

Labor Laws is few drawbacks of the industry from which it has to overcome.

After the elimination of quota restrictions and implementation of National Textile Policy

2000, it is estimated that the industry will grow with rapid rate and help to strengthen the

Indian economy.



Manufacturing units present at all levels

of value chainRaw materialsCotton, wool, silk, jute

Petrochemicals

Fibres and yarn

Man-made fibre/ filament yarn*

Grey fabric

Knittin

g

Weaving

Processed fabric Dyeing

Finishing

Garments

Home textiles

Production unit Spinning mills

Weaving/ knitting units - handlooms, powerlooms, hosiery units

Hand processing units, independent power processing units, units attached to mills

Garments & home textile producersComposite Mills

*Includes viscose staple fibre, polyester staple fibre,

acrylic staple fibre, viscose filament yarn, nylon

filament yarn, polyester filament yarnSource: Industry Research

About Vardhman GroupVardhman is a major integrated textile producer in India. The Group was setup in 1965 at

Ludhiana, Northern India. Since then, the Group has expanded manifold and is today, one of the

largest textile conglomerates in India. The Group portfolio includes manufacturing and

marketing of Yarns, Fabrics, Sewing Threads, Fibre and Alloy Steel.

The group started its corporate journey with an installed capacity of 6000 spindles in 1965 under

the flagship company Vardhman Spinning & General Mills Limited (now known as Vardhman

Holdings Limited and is an investment arm of the Group) in Ludhiana. Over the years the group

has expanded its spinning capacities besides adding new businesses. The group has also

diversified into yarn processing, weaving, Sewing thread, fabric processing, acrylic fibre

manufacturing and into special/ alloy steels. Today, close to 20,000 people is the organisation s

most important asset its human capital.

Vardhman Group manufacturing facilities include over 8,00,000 spindles, 65 tons per day yarn

and fibre dyeing, 900 shuttleless looms, 90 mn meters per annum processed fabric, 33 tons per

day sewing thread, 18000 metric tons per annum acrylic fibre and 100,000 tons per annum

special and alloy steel.

The Vardhman group comprises of three listed and two unlisted companies-

Listed Companies

Vardhman Textiles Limited (formerly Mahavir Spinning Mills Limited)

Vardhman Acrylics Limited

Vardhman Holdings Limited1 (formerly Vardhman Spinning & General Mills Limited)

Unlisted Companies

VMT Spinning Company Limited


Vardhman Threads Limited

HISTORY

The industrial city of Ludhiana, located in the fertile Malwa region of Central Punjab is

otherwise known as the "Manchester of India". Within the precincts of this city is located the

Corporate headquarters of the Vardhman Group, a household name in Northern India. The

Vardhman Group, born in 1965, under the entrepreneurship of Late Lala Rattan Chand Oswal

has today blossomed into one of the largest Textile Business houses in India.

At its inception, Vardhman had an installed capacity of 14,000 spindles, today; its capacity has

increased multifold to over 8 lacs spindles. In 1982 the Group entered the sewing thread market

in the country which was a forward integration of the business. Today Vardhman Threads is the

second largest producer of sewing thread in India. In 1990, it undertook yet another

diversification - this time into the weaving business. The grey fabric weaving unit at Baddi (HP),

commissioned in 1990 with a capacity of 20,000 meters per day, has already made its mark as a

quality producer of Grey poplin, sheeting, and shirting in the domestic as well as foreign market.

This was followed by entry into fabric processing by setting up Auro Textiles at Baddi and

Vardhman Fabric at Budhni, Madhya Pradesh. Today the group has 900 shuttleless looms and

has processing capacity of 90mn meters fabrics/annum.

In the year 1999 the Group has added yet another feather to its cap with the setting up of

Vardhman Acrylics Ltd., Bharuch (Gujarat) which is a joint venture in Acrylic Fibre production

undertaken with Marubeni and Exlan of Japan. The company also has a strong presence in the

markets of Japan, Hong Kong, Korea, UK and EU in addition to the domestic market. Adherence

to systems and a true dedication to quality has resulted in obtaining the coveted ISO 9002/ ISO

14002 quality award which is the first in Textile industry in India and yet another laurel to its

credit.


MISSION

Vardhman aims to be world class textile organization producing diverse range of products for

the global textile market. Vardhman seeks to achieve customer delight through excellence in

manufacturing and customer service based on creative combination of state-of-the-art technology

and human resources. Vardhman is committed to be responsible corporate citizen.

S P Oswal, Chairman - Vardhman Group


PHILOSOPHY


69%

10%

13% 9%

The group portfolio includes manufacturing and marketing of yarns, fabrics, sewing threads

and fibre.

YARNFABRICSEWING THREADFIBRE


Our BusinessesVardhman Group consists of 5 SBUs spread across 9 manufacturing locations.


Spinning Business (Y)

Vardhman Spinning & General Mills Ludhiana, PunjabAuro Spinning Baddi, HPArihant Spinning Malerkotla, PunjabArisht Spinning Baddi, HPGas Mercerised Yarn Business Hoshiarpur, PunjabAuro Dyeing Baddi, HPAnant Spinning Mandideep, MPVardhman Spinning & General Mills (Export Oriented Unit) Baddi, HPVMT Baddi, HPVardhman Yarns Satlapur, MP (Partly commissioned)

Fabric Business (C)

Auro Weaving Baddi, HPMSML Textiles Division Baddi, HPAuro Textiles Baddi, HPVardhman Fabrics Budhni, MP (upcoming)

Sewing Thread Business (ST)ST-I Hoshiarpur, PunjabST-II Ludhiana, PunjabST-III Perundurai, TNVardhman Threads Limited Baddi, HP

Vardhman Special Steels (S) Ludhiana, Punjab

Vardhman Acrylics Limited (F) Bharuch, Gujarat


Yarns

The group is one of the largest spinning group of the country with a spindlage of over 5, 50,000.

The group has 12 production plants located in the states of Punjab, Himachal Pradesh and

Madhya Pradesh. In many of the yarn market segments, Vardhman holds the position of market

leader besides being a large and reliable supplier in the country.

Vardhman is also the largest exporter of yarn from India. The group yarn exports amount to over

US$ 100 million covering the most quality conscious markets in the world. The total export of

Cotton yarn of the group is about 6% of total export of cotton yarn from the country.


Sewing Threads

Vardhman entered the Sewing thread business in 1982 as a forward integration to its yarn

business. The group had to struggle for survival being pitted against a large multinational

organisation. Today with approximately 25 metric tonne/per day of sewing thread manufacturing

capacity in its plant at Hoshiarpur, Ludhiana, Baddi and Perundurai. Vardhman threads have

emerged as second largest sewing thread brand in the country.


Weaving

Continuing its onward march on the value curve, Vardhman group entered weaving business in

1992 with a capacity of 7 million meters per annum. The capacity has been subsequently

expanded to 45 million meters per annum. The group has already made its mark as a quality

producer of grey poplin / shirting / suiting in the home market and has also entered the highly

competitive export market within this short span, now exporting fairly large volume of its

production.


Processed Fabric

In its quest for further value addition Vardhman started fabric processing in 1999. Vardhman

established a modern fabric process house in 1999 with a capacity of 30 million meters per

annum. This capacity has been expanded to 42 meters per annum in FY 2005-06. A Vardhman

fabric is dedicated to meet customer demand for top quality finished fabric through product

innovation, world class quality, state-of-art technology and excellence in service.


Fibre

In 1999 the group set up an Acrylic staple fibre plant at Bharuch in Gujarat in collaboration with

Marubeni and Japan Exlan of Japan. The plant has annual capacity of 18500 metric tonnes per

annum.


Capacities at a Glance

Vardhman has one of the largest spinning capacities in India with a spindlage of more than

5,50,000. Vardhman Threads has emerged as second largest sewing thread brand in the country.

In fabrics, the Group has already made its mark as a quality producer of grey poplin / shirting /

suiting in the home market and has also entered the highly competitive export market within this

short span, now exporting fairly large volume of its production. Vardhman established a modern

fabric process house in 1999 with a capacity of 30 million meters per annum. This capacity has

been expanded to 42 million meters per annum in FY 2005-06. Set up in technical collaboration

with Marubeni and Japan Exlan of Japan, the acrylic fibre plant has an annual capacity of 16500

metric tonnes annum.


LABOUR TURNOVER

Labour turnover refers to the establishment of a relationship between the numbers of employees

leaving during the period of time to the average number of employees during that period.

“It also denotes the percentage change in the labour force of the organization.”

A higher percentage of the labour turnover will mean that employees are not stable and new

employees join while old employees leave the organization. A lower labour turnover on the other

hand means that only small number of employees have come in and gone out of the organization.

TYPES OF LABOUR TURNOVER

Labour turnover is of two types:

i.) Accessions

ii.) Separations

Accessions: It means selection or addition of new employers. There may be new jobs In the

organizations or there may be vacancies for replacement of old employees


Separations: The workers may leave the organizations due to retirement. There may be

terminations on disciplinary grounds or lay-offs due to inadequate work. All this means that

workers exit from the organization

CAUSES OF LABOUR TURNOVER:

The causes of labour turnover are discussed as follows:

A.) UNAVOIDABLE CAUSES:

There may be retrenchment of workers due to shortage of work

Workers may be discharged due to insubordination

A worker may be discharged due to long absence from duty

B.) AVOIDABLE CAUSES:

The management may be offering low wages to the workers

Bad working conditions

Longer hours of work

Lack of promotion avenues

Bad treatment by supervisors

Absence of grievance machinery

Lack of job security

Lack of proper training facilities

Dissatisfaction with the job

C.) PERSONAL CAUSES:

Retirement due to old age

Death


Women workers may leave their jobs after marriage either due to change of place or to

take up household duties

Domestic problems and family responsibilities

Finding of a better job anywhere else

Dislike for the job or place

Some accident may make a worker unfit for doing the present job

A worker may leave a job due to his moving nature

Why is controlling labour turnover important?

It is natural and healthy for people to leave your firm from time to time as this allows for the

introduction of fresh ideas and promotions. Unless you retain workers for a reasonable period,

however, you are unlikely to be able to provide the quality goods and services required to remain

competitive. If labour turnover becomes excessive, it can indicate management problems.

Excessive labour turnover leads to increased expenditure on recruitment and training.

Far costlier may be:

• lost or delayed production or inability to provide service to customers on time

• increased production or service costs

• Unnecessarily high staffing levels and overtime payments

• increased risk of accidents

• Damage to the firm’s local reputation

• Low morale and resulting low productivity

• Long-term workers becoming unsettled and leaving.

How do I get it right?


Keep a record of the number of people leaving and why.

Pay particular attention to voluntary resignations and ask people why they are leaving.

Decide whether turnover is excessive and causing a problem. There is no reliable

benchmark for acceptable levels of labour turnover, but if you are worried, it can help to

compare your turnover with that in similar local firms.

Establish whether excessive turnover is among recent starters or among trained and

experienced workers.

Reduce turnover among new starters by paying particular attention to recruitment,

induction and training. In particular:

ensure job advertisements give an accurate picture of the job including terms and

conditions;

Prepare a clear specification of the person you require;

Set standards that are not too high (this could result in recruits who are overqualified and

who might become bored) nor too low because of a shortage of good candidates;

set suitable selection tests where appropriate –involve supervisors and ensure that

interviewers are trained;

Help new recruits settle in and make sure they have enough information about the job and the

organisation and are trained to carry out their duties effectively.

Reduce turnover amongst long-term workers by checking:

that they feel involved and are kept in the picture about such things as new orders,

product development, new equipment and other changes.

that they are not unfairly discriminated against because of their race, sex, disability,

sexual orientation, religion or belief;

that they are not being bullied or harassed or working under undue stress;


that they have opportunities for development and/or advancement;

management style is acceptable and managers and supervisors (including you) are

trained, particularly to handle the human aspects of management;

pay levels have not become out of line with similar local jobs;

systems and methods of pay are fully understood and felt to be fair;

there are proper procedures for dealing with grievances and disciplinary matters;

that workers are given the opportunity to discuss work and progress with you or their

manager or supervisor;

working conditions are safe, healthy and clean and facilities, such as toilets, are up to

standard

Flexible working is taking seriously. Parents of young and disabled children have the

right to request more flexible working arrangements, including; flexi-time, home

working, term-time working, and job sharing – and employers can only refuse such

requests if there are clear business reasons for doing so;

that workers receive adequate training for new work or to operate new machinery or

procedures;

why leavers resigned

What the workers like and dislike about the company.

LITERATURE REVIEW


Myres (1958) also observed that it is living conditions in the city that are disliked more than the

factory job. Poor living conditions, family and social obligations and having to help the family at

the time of sowing and harvesting often drive them back to the villages.

Bhatt (1975) has found that workers are pushed from rural areas against their volition because of

adverse circumstances such as famine, floods, bankruptcy and lack of job opportunities. The

workers are not able to adjust to the factory routine and overcrowded urban life. The work

pattern is different from the one they used to in the village.

Hackman and Oldham (1975) included five core job characteristics identified by skill variety,

which refers to the opportunity to utilize a variety of valued skills and talents on the job; task

identity, or the extent to which a job requires completion of a whole and identifiable piece of

work - that is, doing a job from beginning to end, with visible results; task significance, which

reflects the extent to which the job has a substantial impact on the lives or work of other people,

whether within or outside the organisation; job autonomy, or the extent to which the job provides

freedom, independence, and discretion in scheduling work and determining procedures that the

job provides; and job feedback, which refers to the extent to which the job provides information

about the effectiveness of one’s performance.

Enid Perlin (1977) observed that there are a variety of things that lead to high satisfaction. Some

of the variables are related to the people with whom you work (supervisors, co-workers), some

are related to the job itself (challenge, clarity), and some are related to the payoffs that occur

(pay, promotions). An increase in satisfaction can have positive benefits for both the individual

and organization. Better physical and mental health as well as lower absenteeism and turnover

see to be the result. While individual productivity may not be increases, these other factors are

important for a smooth-running organization which is also a pleasant place to work.

The term “turnover” is defined by Price (1977) as: the ratio of the number of organizational

members who have left during the period being considered divided by the average number of

people in that organization during the period.


Terence R. Mitchell (1978) stated that one would expect the relationship between job satisfaction

and turnover to be negative. The greater is the satisfaction, the lower is the turnover. It appears,

however, that the strength of this relationship is partly dependent on the degree of full

employment that exists. There are always going to be some people who leave because of

dissatisfaction and some who leave because they have to (the individual moves, a family crisis,

and so on). In times of full employment when numerous job opportunities are available, it is

expected that the percentage of those who leave because of low satisfaction is greater than when

times are hard. Accordingly, the relationship between turnover and satisfaction should be strong

during full employment.

Kanungo (1982) stated that job involvement describes an individual’s ego involvement with

work and indicates the extent to which an individual identifies psychologically with his/her job

(Involvement in terms of internalizing values about the goodness or the importance of work

made employees not to quit their jobs and these involvements are related to task characteristics.

Workers who have a greater variety of tasks tend stay in the job. Task characteristics have been

found to be potential determinants of turnover among employees.

According to Blau and Boal (1989); Brooke and Price,(1989); Brooke (1988); Kanungo, (1982);

involvement would influence job satisfaction and increase organizational commitment of the

employees. Employees who are more involved in their jobs are more satisfied with their jobs and

more committed to their organization. Job involvement has also been found to be negatively

related to turnover intentions. Job satisfaction, career satisfaction, and organizational

commitment reflect a positive attitude towards the organization, thus having a direct influence on

employee turnover intentions. Job satisfaction, job involvement and organizational commitment

are considered to be related but distinguishable attitudes. Satisfaction represents an effective

response to specific aspects of the job or career and denotes the pleasurable or positive emotional

state resulting from an appraisal of one’s job or career.

Costly (1987) points out that a high labour turnover may mean poor personnel policies, poor

recruitment policies, poor supervisory practices, poor grievance procedures, or lack of

motivation. All these factors contribute to high employee turnover in the sense that there is no


proper management practices and policies on personnel matters hence employees are not

recruited scientifically, promotions of employees are not based on spelled out policies, no

grievance procedures in place and thus employees decides to quit.

Muchinsky, (1990) suggested that insufficient information on how to perform the job adequately,

unclear expectations of peers and supervisors, ambiguity of performance evaluation methods,

extensive job pressures, and lack of consensus on job functions or duties may cause employees to

feel less involved and less satisfied with their jobs and careers, less committed to their

organizations, and eventually display a propensity to leave the organisation. If roles of

employees are not clearly spelled out by management/ supervisors, this would accelerate the

degree of employees quitting their jobs due to lack of role clarity.

Woods (1995) stated that managers refer to turnover as the entire process associated with filling

a vacancy: Each time a position is vacated, either voluntarily or involuntarily, a new employee

must be hired and trained. This replacement cycle is known as turnover. This term is also often

utilized in efforts to measure relationships of employees in an organization as they leave,

regardless of reason.

Malone (1997) described that Empowerment of employees could help to enhance the continuity

of employees in organizations. Empowered employees where managers supervise more people

than in a traditional hierarchy and delegate more decisions to their subordinates. Managers act

like coaches and help employees solve problems. Employees, he concludes, have increased

responsibility. Superiors empowering subordinates by delegating responsibilities to them leads

to subordinates who are more satisfied with their leaders and consider them to be fair and in turn

to perform up to the superior’s expectations. All these makes employees to be committed to the

organization and chances of quitting are minimal.

Griffeth (2000) noted that pay and pay-related variables have a modest effect on turnover. Their

analysis also included studies that examined the relationship between pay, a person’s

performance and turnover. They concluded that when high performers are insufficiently

rewarded, they quit. If jobs provide adequate financial incentives the more likely employees


remain with organisation and vice versa. There are also other factors which make employees to

quit from organizations and these are poor hiring practices, managerial style, lack of recognition,

lack of competitive compensation system in the organisation and toxic workplace environment.

John (2000) explained that employee turnover is expensive from the view of the organisation.

Voluntary quits which represents an exodus of human capital investment from organizations.

Fair and the subsequent replacement process entail manifold costs to the organizations. These

replacement costs include for example, search of the external labour market for a possible

substitute, selection between competing substitutes, induction of the chosen substitute, and

formal and informal training of the substitute until he or she attains performance levels

equivalent to the individual who quit. Addition to these replacement costs, output would be

affected to some extend or output would be maintained at the cost of overtime payment. The

reason so much attention has been paid to the issue of turnover is because turnover has some

significant effects on organizations.

Dess (2001) argues that if employee turnover is not managed properly it would affect the

organization adversely in terms of personnel costs and in the long run it would affect its liquidity

position. However, voluntary turnover incurs significant cost, both in terms of direct costs

(replacement, recruitment and selection, temporary staff, management time), and also (and

perhaps more significantly) in terms of indirect costs (morale, pressure on remaining staff, costs

of learning, product/service quality, organizational memory) and the loss of social capital.

Trevor (2001) argues that local unemployment rates interact with job satisfaction to predict

turnover in the market. Role stressors also lead to employees’ turnover. Role ambiguity refers to

the difference between what people expect of us on the job and what we feel we should do. This

causes uncertainty about what our role should be. It can be a result of misunderstanding what is

expected, how to meet the expectations, or the employee thinking the job should be different.

Meaghan (2002) found that knowledge accessibility, the extent of the organization’s

“collaborativeness” and its capacity for making knowledge and ideas widely available to

employees would make employees to stay in the organisation. Sharing of information should be


made at all levels of management. This accessibility of information would lead to strong

performance from the employees and creating strong corporate culture Therefore information

accessibility would make employees feel that they are appreciated for their effort and chances of

leaving the organisation are minimal.

Firth (2004) stated that the experience of job related stress (job stress), the range factors that lead

to job related stress (stressors), lack of commitment in the organisation; and job dissatisfaction

make employees to quit. This clearly indicates that these are individual decisions which make

one to quit. There are other factors like personal agency refers to concepts such as a sense of

powerlessness, locus of control and personal control. Locus of control refers to the extent to

which people believe that the external factors such as chance and powerful others are in control

of the events which influence their lives.

According to Simon (2007) there are some factors that are, in part, beyond the control of

management, such as the death or incapacity of a member of staff. Other factors have been

classed as involuntary turnover in the past such as the need to provide care for children or aged

relatives. Today such factors should not be seen as involuntary turnover as both government

regulation and company policies create the chance for such staff to come back to work, or to

continue to work on a more flexible basis. The imposition of a quantitative approach to

managing the employees led to disenchantment of staff and hence it leads to labour turnover.

Therefore management should not use quantitative approach in managing its employees.5r

Adopting a cost oriented approach to employment costs increases labour turnover. All these

approaches should be avoided if managers want to minimize employee turnover an increase

organizational competitiveness in this environment of globalization.

RESEARCH METHODOLGY


The research is the survey research. It is a study which examines the causes of labour turnover in

Vardhman Spinning and General Mills whether they are voluntary or involuntary. The data used

for this study was from primary sources.

We used the questionnaire technique for collecting the primary data, as it is an efficient mean of

collecting answers from a large sample size. The questionnaire was designed in order to enable

us to extract the necessary accurate information from the respondents’ answers, and to make sure

that collected information is adequate for achieving the objectives of this study. The

questionnaire was made in Hindi for the ease of workers so that they can easily understand the

questions and answer them accurately.

The questionnaire contains the non-probability scaling. Most of the questions are closed in

order to ease the respondent’s task and the answers are in the form of “yes”, “no” and

“sometimes”. The survey is applied only in the Vardhman Spinning and General Mill, Ludhiana.

The sample for this study consisted of the workers in the mill and the sample size was 100

workers.

The secondary source that is used in this project is the research work that other people have

done. This included the articles from different magazines and different research papers which

support the topic of labour turnover.

ANALYSIS AND INTERPRETATION


93%

7%

SALARY SATISFACTION

YESNO

INTERPRETATION:

93% of the workers are satisfied with their salary while 7% are not satisfied. The dissatisfaction

may be because of the reason that the work load is more on the workers and they are not getting

the money worth the work done.


100%

SALARY ON TIME

YESNO

INTERPRETATION:

100% workers are satisfied to get their salary on time.


80%

20%

TRANSPORT FACILITY

YESNO

INTERPRETATION:

80% workers are availing the facility of transportation; only 20 % of workers are not availing

with this facility.


82%

16%

2%

MEDICAL FACILITY AVAILABLE

YESNOSOMETIMES

INTERPRETATION:

82% workers can get the proper medical facility when needed, while 2% of the workers can get

this facility at sometimes.


83%

14%

3%

CANTEEN FACILITY

YES NOFOOD IS NOT GOODFOOD IS NOT SERVED ON TIME

INTERPRETATION:

83% workers can be happy with their mill canteen facility while only 3% workers say that food

is not good in the canteen. The reason being the quantity of the food served in the canteen is less

and is should be increased.


78%

14%

8%

COLONY FACILITY

YESNOTO SOME EXTENT

INTERPRETATION:

78% workers are satisfied with the colony facility provided by the mill and 8% workers are

satisfied upto some extent.


86%

11%

3%

SATISFIED WITH WORKING HOURS

YESNOTO SOME EXTENT

INTERPRETATION:

86% workers are satisfied with their working hours while 3% of the workers are satisfied upto

some extent.


96%

4%

HELPING TEAM

YESNO

INTERPRETATION:

96% of the workers say that their teams help them in their work while 4% of the workers say that

they do not help them.


81%

12%

7%

BEHAVIOUR OF SENIORS AND CO-WORKERS

YESNOSOMETIMES

INTERPRETATION:

81% of the workers says that their seniors and co-workers behave properly with them while 7%

of the workers say that they behave properly upto some extent.


86%

5%

9%

SATISFIED WITH PROMOTION POLICY

YESNOTO SOME EXTENT

INTERPRETATION:

86% of the workers are satisfied with the promotion policy while 5% are not satisfied.


76%

17%

7%

RIGHT TO EXPRESS VIEWS INDEPENDENTLY

YESNOTO SOME EXTENT

INTERPRETATION:

76% of the workers have the right to express their views independently while 7% of the workers

have right upto some extent.


63%

27%

10%

REWARD OR INCENTIVES FOR EXTRA WORK

YES NOSOMETIMES

INTERPRETATION:

63% of the workers have get the rewards and incentives for the extra work they have done while

10% of the workers get it sometimes.


78%

9%

13%

GOOD RELATIONS BETWEEN EMPLOYER AND EMPLOYEE

YESNOTO SOME EXTENT

INTERPRETATION:

78% of the workers have good relations with their employees while 9% of the workers have not.


77%

15%

8%

SATISFIED WITH THE DISCIPLINE

YESNOTO SOME EXTENT

INTERPRETATION:

77% of the workers are satisfied with the discipline in the mill but 8% of the workers are

satisfied upto some extent.


78%

9%

13%

SUPPORTIVE WORK ENVIRONMENT

YESNOTO SOME EXTENT

INTERPRETATION:

78% of the workers say that they get supportive work environment in the mill while 9% say that

they do not


78%

8%

14%

IMPROVEMENT IN SKILLS AND ABILITIES

YESNOTO SOME EXTENT

INTERPRETATION:

78% of the workers say that the organisation does something to improve their skills and abilities

while 8% of the workers say that it does not.


23%

18%59%

REASONS FOR WORKING

NEAR TO HOMEGOOD ENVIRONMENTGOOD SALARY

INTERPRETATION:

59% of the workers think that the reason for working in the mill is good salary, 23% of the

workers say that the reason is near to home and the rest 18% say that they work in the mill

because of good working environment.


34%

66%

CHANGES IN THE WORK

YES NO

INTERPRETATION:

66% of the workers do not want any changes in their work while 34% of the workers want to

change their work.


77%

23%

SATISFIED WITH LEAVE ARRANGEMENTS

YESNO

INTERPRETATION:

77% of the workers are satisfied with the leave arrangements in the mill while 23% are not

satisfied with it.


84%

16%

SATISFIED WITH THE TRAINING

YESNO

INTERPRETATION:

84% of the workers are satisfied with the training provided to them to perform their work while

16% of the workers are not satisfied with this training.


RESULTS AND FINDINGS

As the main objective of the study was to find out the level of worker’s satisfaction and the

reason for the labour turnover, the following findings came out:

With the help of the questionnaire, the survey was done, and it has been found that the

workers are dissatisfied by not getting the rewards or incentives for the extra work they

have done. 37% of the workers are not satisfied in this case.

93% of the workers are satisfied with their salary which they get for the work done.

100% workers are satisfied by the payment of salary on time.

80% of the workers are satisfied with the transport facility while 20 % are not.

82% of the workers are satisfied with the medical facility in the mill.

78% of the workers are availing the facility for the colony and are satisfied while the

others are not availing this facility

83% of the workers are satisfied with the canteen facility

86% of the workers are satisfied with the working hours in the mill.

96% of the workers say that their teams help in their work

81% of the workers are satisfied with the behavior of the seniors and co-workers.

86% of the workers are satisfied with the promotion policy in the mill.

78% of the workers say that they have good relations with their employers

77% of the workers are satisfied with the discipline in the mill

78% of the workers are satisfied with the supportive work environment they get in the

mill.

78% of the workers say that the organization helps them in improving their skills and

abilities.

84% of the workers are satisfied with the training provided to them by the mill to do their

work


SUGGESTIONS AND RECOMMENDATIONS

The main reason for the dissatisfaction amongst the workers is the lack of benefits

provided to them. So more benefits and wages should be provided to the workers in the

mill.

Exit interviews should be conducted at the time any worker is going to leave the mill.

This would help in finding out the reason for quitting the job as well as to find out the

loopholes in the management of the mill.

Workers suggestion schemes should be introduced to take the suggestions for any kind of

changes or any other thing. This will help in satisfaction as well as the motivation of the

workers because workers will feel that they are given importance.

Pay levels should be made equal to the others for doing the same work in the same

industry.

Providing crèche facilities to the female workers who have small children at home. This

would help in retaining the female workers.

Worker satisfaction surveys should be done by the organization regularly to find out the

reasons and hence curb it.

Employees Leaving due to Conflict – more effective procedure for handling grievances &

improving communication, using resolution & teambuilding techniques, reorganization of

work.

Improving recruitment & selection process, ensure job requirement, developing better

induction & initial training program.


CONCLUSION

A high rate of labour turnover is bad both for the worker and the industry. Hence effort should be

made to reduce it.

The heavy rate of labour turnover is great handicap for workers and industry alike, for it implies

reduction in skill & efficiency on the part of the workers & reduced output for the industry low

ever some amount of labour turnover is inevitable & even natural particularly when it stems from

the retirement of old employees and the accession of new blood. But both the management of

government undertaking & private undertaking must take serious steps to solve this problem as

soon as possible.

Dealing effectively with absence or labour turnover call a continuous and co-ordinate effort by

personnel managers, line managers, including first-line supervisors, and worker representatives.

High absence or labour turnover can often be a symptom of workers’ dissatisfaction with their

jobs. Sound fair and consistent policies and procedures can provide a framework within which

labour turnover and absence problems can be better handled.


QUESTIONNAIRE

VARDHMAN SPINNING AND GENERAL MILLS, LUDHIANA

NAME: TOKEN NO.: SECTION:

AGE: MALE/ FEMALE:

Q.1 Are you satisfied with your salary?

a) Yes b) no c) to some extent

Q.2 Do you get your salary on time?

a) Yes b) no

Q.3.Have you availed the transport facility?

a) Yes b) no c) sometimes

Q.4. Do you get proper medical facility when needed?


Q.5. Are you happy with your mill canteen?

a) Yes b) no

c) Food is not good

d) Food is not served on time

Q.6. Are you satisfied with colony facility in the mill?



Q.7. Are you satisfied with your working hours?

a) Yes b) no

Q.8. Do your team help in your work?

a) Yes b) no

Q.9. Do your seniors and co-workers behave properly with you?


Q.10. Are you satisfied with the promotion policy of the mill?


Q.11. Do you have a right to express your views independently?


Q.12. Do you get any rewards or incentives for the extra work you have done?


Q.13. Do you have good relations with your employers/ supervisors/managers?

a) Yes b) no

Q.14. Are you satisfied with the discipline in the mill?


Q.15. Do you get supportive work environment in the mill?


Q.16. Does the mill do something to improve your skills and abilities?



Q.17. why do you think to work here?

a) Near to home

b) Good environment

c) Good salary

Q. 18. Are you satisfied with the leave arrangements in the mill?

a) Yes b) no

Q.19. Are you satisfied with the training provided to you to perform your work?


Q.20. Do you want any change in the work?

a) Yes b) no


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