Monday, 5 January 2015


Competition on the basis of cheap labour:-
Globalization and increased competition has lead to less strikes, lockouts and less man days lost due to strikes. Also now in the era of knowledge industry employees are educated and thus don¡¦t believe in violent activities. They are having responsibilities in cut throat competition and also are aware of their rights well leading to decline in strikes. Employers also avoid lockouts because decline in production for even hours results in heavy losses so forget about days or weeks. 

Disinvestment: - it affects IR in following ways:_

It changes ownership, which may bring out changes not only in work org and employment but also in trade union (TU) dynamics.
It changes the work organization by necessitating retaining and redeployment.
It affects the right of workers and Trade unions, including job/union security, income security, and social security.

Trade unions, mgt and government are responding to these challenges through various types of new, innovative, or model arrangements to deal with different aspects of disinvestment like

„X Making workers the owners through issue of shares or controlling interests (latter is still not in India)
„X Negotiating higher compensation for voluntary separations
„X Safeguarding existing benefits
„X Setting up further employment generating programs, and
„X Proposals for setting up new safety nets that not only include unemployment insurance but also skills provisions for redundant workers.

Deregulation: - it is tried to ensure that pubic sector/ government employees receive similar protection as is provided in public/government employment. The worst affected are the pension provisions. this means, usually a reduction in pension benefits and an uncertainty concerning future provision of pension benefit due to 

„X The absence of government guarantees
„X Falling interest rates
„X Investment of pension funds in stock markets

Decentralization of IR is seen in terms of the shift in consideration of IR issues from macro to micro and from industry to enterprise level. When the coordination is at the national or sectoral level then work in the whole industry can be paralyzed because of conflict in IR. But when the dispute is at the bank level, in the absence of centralized coordination by Trade unions only work in that bank is paralyzed and the other banks function normally. This weakens the bargaining power of unions.

New actors and the emerging dynamics: - Earlier IR was mainly concerned with Trade unions, mgt and government but now consumers and the community are also a part of it. When the right s of consumers and community are affected, the rights of workers and unions and managers / employers take a back seat. Hence there is ban on bandh and restrictions even on protests and dharnas.
Increasingly Trade unions are getting isolated and see a future for them only by aligning themselves with the interests of the wider society.

Pro-labour-pro-investor policies

This leads to decline in strength and power of Trade unions if not in numbers. Unions have to make alliances with the society, consumers and community and various civil society institutions otherwise they will find themselves dwindling.

Declining TU density

In government and public sectors workforce is declining because of non-filling of vacancies and introduction of voluntary / early separation schemes. New employment opportunities are shrinking in these sectors.

In the private sectors particularly in service and software sector, the new, young, and female workers are generally less eager to join unions.

Workers militancy replaced by employer militancy

Due to industrial conflicts 

In 1980-81 man days lost = 402.1 million 
In 1990-91 man days lost = 210 million

Not because of improved IR but because of the fear of job security, concern about the futility of strikes, and concern to survive their organization for their income survival.

Trade unions have become defensive evident from the fact that there is significant shift from strikes to law suits. Instead of pressing for higher wages and improved benefits, Trade unions are pressing for maintenance of existing benefits and protection and claims over non-payment of agreed wages and benefits.

Collective Bargaining

Level of collective bargaining is shrinking day by day.

Some more information:-

In India, while labour is in the Concurrent List, state labour regulations are an important determinant of industrial performance. The Survey notes evidences that states that had enacted more pro-worker regulations, had lost out on industrial production in general. 

However, on the upside, the Survey said there was a secular decline in the number of strikes and lockouts during 2000-04. The total number of strikes and lockouts went down 13.6% from 552 in 2003 to 477 in 2004. The decline was sharper in the number strikes than in lockouts, it noted. 
While most of the strikes and lockouts were in private sector establishments, overall industrial relations had improved, especially between 2003 and 2004, when there was a decline in the number of mandays lost by 6.39 million. 

Among states, the maximum number of strikes and lockouts were in Left-ruled West Bengal, followed by Tamil Nadu and Gujarat. The sectors which saw instances of industrial disturbance were primarily textiles, engineering, chemical and food product industries. 

Stressing on the importance of labour reforms to enhance productivity, competitiveness and employment generation, the Survey noted that a beginning had already been made in that direction. For instance, in the current year, there was a proposal to enhance the wage ceiling from Rs 1,600 per month to Rs 6,000 per month through The Payment of Wages (Amendment) Act 2005. Also, the proposal to empower the central government to further enhance the ceiling in future by way of notification is already in effect from November 9, 2005. 

As regards women working on night shifts, The Factories (Amendment) Bill 2005, was under consideration to provide them flexibility and safety. 
Also, to simplify the procedure for managements to maintain registers and filing returns, an amendment of Labour Laws (Exemption from Furnishing returns and maintaining Registers by Certain Establishments) Act 1988, was under consideration.