Industrial Relations


Industrial Relations

The term of industrial relations (IR) covers the relationship of employees with the management and the organization and also with each other. Industrial relations is concerned with anticipating, addressing and diffusing workplace issues that may interfere with an organization’s business objectives, as also with resolving disputes between and among management and employees. Traditionally, the term industrial relations is used to cover such aspects of industrial life as trade union activities, collective bargaining, employees participation in management, discipline and grievance handling, industrial disputes and interpretation of labor laws and rules and code of conduct. It includes the processes of analyzing the employer-employee relationship, ensuring that relations with employees comply with applicable central and local laws and regulations, and resolving workplace disputes. The practice of counseling, disciplining and terminating employees falls within the domain of this discipline.

In the words of Lester, “Industrial relations involve attempts at arriving at solutions between the conflicting objectives and values; between the profit motive and social gain; between discipline and freedom, between authority and industrial democracy; between bargaining and co-operation; and between conflicting interests of the individual, the group and the community.”

Industrial relations differs from traditional human resource management since it focus on the collective aspect of relations such as labour laws, collective bargaining, the right to strike and trade union activities etc. In short, IR consists of management of collective relations between employers and the employees. Collective bargaining is a process through which employee issues are settled through mutual discussions and negotiations through give and take approach. If the issues are not settled through collective bargaining they should be referred to voluntary arbitration but not to adjudication in order to maintain congenial relations.

The three main participants in the industrial relations activities are employer’s management, employees and employee’s organizations like trade union etc., and government agencies. All the three participants are to play important and pro active role to build a positive peaceful industrial relations environment and avoiding of industrial conflicts in the organization. While the employee’s organization and the employer’s representatives carry out the activity of collective bargaining, the government agencies plays a balancing role in the negotiations.

Objectives of Industrial relations

The primary objective of the IR is to maintain congenial relations between the employer and the employees. The other basic objectives of IR include the following.

  • Maintenance of industrial peace is an important objective. Permanent industrial peace in the organization is essential for achieving the production and financial targets.
  • Creations of a congenial environment so that employees own the production and financial targets.
  • Efficient production of goods and services through adequate terms and conditions of employment which satisfies the interests of employers, employees and society as a whole.
  • Improvement of economic and social status of the work force.
  • Minimization of the industrial conflicts and settlement of industrial disputes through consensus achieved by negotiations.
  • Avoidance of differences and settlement of disputes through dispute settlement mechanism.
  • Establishment of mechanisms for communication, consultation and cooperation in order to resolve work place issues at the enterprise and industry level.
  • To have say in the management and decision making.
  • To maintain industrial democracy.
  • To achieve through a tripartite process on issues like labour policy at national level.
  • To provide social protection where needed for example in the area of safety, occupational health and social security etc.
  • Establishment of stable and harmonious relationship between employees, employers and the organization and between them and the government authorities.

The establishment of good industrial relations depends on the constructive attitude on the part of both the management and the employees through trade union. The constructive attitude in its turn depends on all the basic policies and procedures laid down in the organization for the promotion of healthy industrial relations. It also depends on the ability of the employers and the employee’s trade union to deal with the mutual problems freely, independently and with responsibility. Both the management and the employees should have their faith in collective bargaining rather than in collective action. It is very difficult to promote and to maintain sound industrial relations. Industrial relations encompass all such features that influence behavior of people at work. These features are described below.

  • Industrial relations are mainly the relations between employer and the employees.
  • The industrial relations encompass the organization, employer, employees, employee’s associations and trade unions and local authorities and government.
  • Industrial relations are the outcome of the practice of human resource management and employment relations.
  • Industrial relations emphasis on accommodating other group’s interest, values and needs. Groups develop skills of adjusting to and cooperating with each other.
  • Industrial relations are governed by the system of rules and regulations concerning work place and work force.
  • The main objective of industrial relations is to maintain harmonious relations between employer and employees by solving the problems through grievance procedures and collective bargaining.
  • The government shapes the industrial relations through industrial relations policies, rules, agreements, mediations, rewards and acts etc.
  • Trade unions play an important role in the industrial relations. They influence and shape the industrial relations through collective bargaining.

The different factors (Fig 1) which influence greatly the industrial relations in an organization are given below.

  • Institutional factors – These factors include government departments dealing with labour related issues and labour legislations, organization’s vision and mission, collective agreement, courts and lok – adalats, social institutions like community, caste, creed, system of beliefs, attitudes of workers towards work, system of power status etc.
  • Economic factors – These factors include type of organization like public sector and private sector etc., compensation levels, cost of living, saving potential, organization’s profitability, structure of work force, and availability of personnel in the employment market etc.
  • Technological factors – These factors include mechanization, automation, rationalization, and computerization etc.
  • Political factors – These factors include political system in the country, political parties and their ideologies, their growth, mode of achievement of their policies, involvement in trade unions etc.
  • Social and cultural factors – These factors include population, religion, customs and tradition of people, race ethnic groups, cultures of various groups of people etc.
  • Governmental factors – These factors include various governmental policies such as industrial policies, labour policies and economic policies etc.

industrial relations

Fig 1 Factors affecting the industrial relations in an organization