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1-2. Nature of

Industrial Relations:Traditional & Changing

Perspectives

Debi S. Saini

Professor & ChairpersonHRM Area

Management Development Institute, Gurgaon

2

The issues discussed in the presentation are:

Importance of theory for managers for diagnosing HRM-IR issues

Conflict dynamics in different organizations

Nature of industrial conflict & industrial relations

Focus of the discipline of IR

Traditional issues in IR

Two extreme models of employee relations

Frames of reference of IR: UnitaristPluralistMarxist

3

Two Main Components of this Course:

Management ofPersonnel/People

(System, skills, productivity, efficiency, engagement)

Management ofIndustrial Relations

(Conflict, interests, rights, democracy, discipline)

Lately, the two perspectives are getting

merged into an integrated HRM framework

On Intertwining Theory

and Practice:

Understand IR Issues

in Context

55

Some Models

ofEmployee Relations

Tata Steel Ltd.: HRM Model

Sr. Mgt. work at less than 60% of market worth; dont leave

Meets need fordignity, stability, security: No strike since 1958

Participation

It usedpaternalism (kin employment) & family invitation

CSR creates a sense ofpride in employees


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500WM including contract WMMost are blue-collaredManufactures automobile graphicsEst.: KishoreMushale

4 WM 25 yrs.ago (in 10x 10):Built44acrecampus in Vasai

3 plantsnow: Mumbai;Vasai; HardwarNo Union

Kishore Musale CharitabelTrust,

carries out many charitable activities

Main motto: dignity at work.Believes in: valuing every individual, giving people their due,

freedom,respect,opportunitybackedby lots oftraining.

Classic Stripes (Mfg.): Come Out of Control Mindsethttp://classicstripes.com/manufacturing_plants.html

Won Safety & Environt2003 award(SIGAgivento 5 cos.worldwide.)

Kaizen Training: 2hrspermonth A relationship committee: Meets twice in a month

Comprises ofemployees acrosslevels

Has a library with trade journals, magazines and books

DM Policy: Women make 1/3rd of the workforce

Proactive DM policy: Even for handicapped WM

Shares with employees a %age of its annual profits

Classic Stripes: Some HR Initiatives contd

99

Glaziano Fiasco

Maruti problems

How do we go about

Understanding the issues

1010

On Understanding

the Roots of

Industrial Conflict

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Why Labour-Management Conflict Occurs

Conflict is at the centre of IR, society, in orgs.

Why: Divergence of interests, values, goals, attitudes

Industry: A microcosm ofsociety

Societal/indl. Conflicts: Complex phenomenon

Difficult to fully understand/describe: HMSI case shows that

11 1212

Nature

ofIndustrial Relations


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Industrial Relations: Simply Speaking:

Industrial relations (IR)

is the process of rule making

that mediates between divergent interests

of capital and labour1414

How can we view Industrial Relations

J. H. Richardson (Leeds University)

Industrial relations is

the art of living together

for purposes of production

Important

Some

regulation

is needed

in

all relations;

State

determines

the regulation

framework

1515

How can we view Industrial Relations contd

Hugh Clegg (Clegg & Flanders pioneers of Classical Oxford School of IR)

Industrial relations is a study of

workers and their unions,

employers and their associations,

and State & its institutions/agencies

concerned with regulation of employment.

Imp.: Different powers, roles, interests, duties of Actors16

Dynamics of Industrial Conflict: Factors at Macro Level

Industrial conflict dimensions in a country depend on:

Acceptance of Market orSocial justice as values

Distribution of power in societySocietal Ideology

State of the economy

Nature of labour market

Use & acceptability of strike/Collective bargaining

Globalization diluting welfare state: Focus on market economics16

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Have the

Environmental factorsof IR changed in the

past some years?

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What Does Globalization mean?

Global movement of capital

Global movement of businesses

To expandbeyond their domestic borders

Driven by principles offree market economy

& less obstructedpeople movement

Across borders within companies


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Globalization & Other Causes of Changes in Business

1. GLOBALIZATION Syndrome

2. Information Revolution/Internet

3. New Technology

4. Emergence of Service Industry

5. HRM Philosophy:

M. Thatcher has been namedUKs most

effective prime minister of the 20th century

by BBC History Magazine 30 Aug, 2006, TOI

Globalization has led to:

Internl integration of economies

PSU reforms & privatization

Collaborations & jt. ventures

Dominance of market rationality

Decline of welfare state

Psychological Contract

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Focus of

the Discipline of IR

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Focus of the Discipline of IR

A. IR Institutions(permanent form of custom or law)

Unions

Employer associations

State/ Labour Bureaucracy

ILCILO

Tribunal/Labour Court

Labour law

Higherjudiciary22

Focus of the Discipline of IR

B. Characters (or actors) in IR

Union leaders

HRM Managers

Conciliation Officers/ Mediators

Arbitrators/judges

Labour Courts/

Labour Lawyers/Consultants

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Focus of the Discipline of IR cond

C. IR procedures (aim at: Procedural justice)

Bargaining/Negotiation

Conciliation

Arbitration

Adjudication

Reference

Procedure for going on strikes/ lockouts

Inquiries/Disciplinary procedure

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Traditional issues

inIndustrial Relations


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Traditional Problems in IR

1. Job satisfaction: Job designreward

2. Negotiating Wage/salary/VRS

3. Alienation & discontent: Social & psychological problems

4. Grievance management: BossEnvironmentRule-centricity

5. Formation of trade union26

Traditional Problems in IR

6. Industrial dispute settlementDealing with Impasse

7. Tackling Indiscipline, absenteeism & mobility

8. Managing Labour Laws

9. Designing Labour welfare /QWL

10. Communication

11. Joint consultation, participation, involvement

2727

How do IR actors

try to derive Power:

Various Sources across

the Frames of Reference?

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Two Extreme Models

of Industrial Justice/IR

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Perfectly Pluralist IR Model

Presence of trade union/s; union rights respected

Recognition of the trade union by the employer

Presence of adversarial collective bargaining

Freedom to strike/lockout to the parties

Negotiated settlement guides IR

Reflected in: Classical Oxford School of IR (by Allan Flanders & Hugh Clegg)

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Perfectly Neo-Unitarist Industrial Relations

Employer strives forDecent Work, Cooperative IR

Commonality of interests is its hallmark

Union is considered undesirable; a state of sickness in IR

Union-substitution strategies: Psychological contract

Reflected in HRM Approach to IR30


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3131

Frames of Referencein Industrial Relations

& New Issues in IR

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III. Marxist (Radical) Perspective Pluralist view of society based on post-capitalism is wrong

Capitalist profit is key influence on co. policy

Control enforced downwards by capitals agentsSurplus value generationby capitalist

The Marxist general theory of society argues:

Class conflict is the source of societal change

Without conflict society will stagnate

Class conflict is caused by disparity in power

Differential access to education, media, govt. jobs

Employees socializedinto accepting the status quo

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Marxist Perspective contd

CB: limited accommodation of fundamental divisions

Unions/IR instts. are concerned only with marginal issues

Law not independent referee

Industrial Justice: only if revolution

I. TraditionalPluralism

(German Pharma)

II. Paternalistic

Pluralism

(Tata Steel/NDPL)

III. Ambivalent

Pluralism

(Most unionized cos.

Maruti-Suzuki Ltd.)

IV. RepressivePluralism

(SimranFoods Ltd.)

V. Coercive

Unitarism

(Glazianobefore the

violence; SMEs)

VI. Ambivalent

Unitarism

(Or manoeuvred

Unitarism through law,

shenanigans,

paternalism, collusionwith bureaucracy)

VII. Paternalistic

Unitarism

(Indian SMEs,

Flaxo Exports)

VIII.

IBM type Unitarism

(New Unitarism)

(Hero-Honda, Air Tel)

Eight Broad Typologies of IR Models

Debi Saini 2010

1-2. red. nature of tradl

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