Industrial Relations wd59

Introduction –INDUSTRIAL RELATIONS ( Employer Employee Relations) Evolution of Industrial Relations We have, in our introductory part of this lecture, discussed in short the Industrial Relations, it requisites, objectives and how to foster good Industrial Relations. Now we will discuss evolution of industrial relations, which will comprehend the background of industrial relations showing the way as to how Industrial Relations became so important to run industry or establishment. In this chapter we will look Industrial Relations System from a broad perspective. The concept of Industrial Relations has a wide meaning. The expression Industrial Relations by itself means relationship that emerges out of day today working and association of labour and management. Industrial relations thus when taken in its wide meaning is a “set of functional interdependence, involving historical, economic, social, psychological, technological, occupational, political and legal variables.” It also covers the area of quality control, marketing, price fixation and disposition of profit among others. The evolution of industry has been quirt gradual. If we go through the primitive stage of human activities, we find that initially there used to be no industrial activity. The people lived by themselves. Gradually, the people came to stage of exchange of services for goods. This made the background for evolution of industry and initial stage of industrial relations. To have better knowledge, we can classify the stages of evolution of industries as follows:1. 2. 3. 4. 5. 6.

Primitive stage Agrarian economy stage Handicraft stage Guild system Domestic system Industrial revolution

Primitive Stage – The families at this stage were self-sufficient. This was because men devoted their time to activities like hunting, fishing and making of weapon and women were busy in cooking, upbringing the children, domestication of animals and agriculture. Division of labour was limited to family itself. During this period the barter system developed. The main difficulty of the barter system was lack of double coincidence and common measure of value. Agrarian Economy Stage – The things changed during this stage. Many tribes settled down permanently at some place. Agriculture became the main source of maintenance. With the rise of population and ownership of land, there was split up of the families. The families were not self sufficient because of varied activities. This led to exchange of goods. Later on the traders came into existence. The difference between sale and purchase price was their profit. Diversification of activities was observed during this period. Handicraft Stage – During this stage the craftsman ,artisans living in villages produced the products for local population and exchanged them with various things which were required for them. 4.Guild Stage- Under this stage two types of guild were initiated, namely Merchant guild and Craft guild. A merchant guild was association of merchants engaged in trade in a particular locality to enforce equality of opportunity for the of the guild, to avoid competition, regulate conduct and protect their interest. The craftsman guild was there to regulate the conduct of their and protect their interest. 5.Putting Out System – During this stage, with the increase in demand, the intermediary played a vital role. The entrepreneur gave outwork to artisans who worked in their homes. By the age of time, the artisans faced difficulties because of increase of demand. The process of finding new tools to increase the production was need of the hour. The stage was set for getting the work done by the artisans at the premises of the entrepreneur This was the beginning industrial activities. 7. Industrial Revolution- During the later part of 18th century and earlier part of 19th century the industrial revolution played a vital role. With the invention of new technique of production, the establishment of industries was taking place, employing workers to complete the task of production. Large-scale employment of workers gave birth to labour problems ; Changes brought about by Industrial Revolution:-

Development of Engineering- The Engineers were required to design and develop new machinery for textile, coal, mines and other industries to meet the requirement of the industries. They were also assigned the job to develop new tools for repairing of machines so that the work may be finished at the earliest. Revolution in iron making – The engineers who were assigned this task, were successful and improving the quality of the cast iron and were able to cast iron in good quantity. Use of power driven machines – The use of Power Driven machinery was introduced starting from textile and spreading to other industries. Rise of chemical industries – The chemicals, which were used in textile industries give impetus for establishment of chemical industries. Development of coal mining- The coal was need for steam power, refining of pig iron and casting of iron as such attempt were made to increase its production to meet the demand. Development of means of transport- You are aware that for supply of raw material to industries and distribution of finished goods good transport system is need. To meet the requirement, attempts were made to develop good transport system. Economic Effects of Industrial Revolution Large-scale production Change of form of ownership The Specialization Rise of capitalism Trade Cycles Standard of living Social and Political effects Urbanization Rise of individualism Awareness of rights Poor working conditions Political awareness Machine Age and Modern Factory System

To cater the needs of the people many changes took place in the industrial system. The invention of machines and its use in the industry is called the machine stage. The feature of machine age may be summarized as under;Large scale production Mechanization Automation Management information system Specialization Standardization Growth of industrial area Expansion of International Trade Research and development. Competition. The machine age brought in under factory system. The entrepreneur established factories and employed large number of workers. This led to the emergence of two distinct classes viz. the capitalist class and working class. The capitalist were strong and the workers did not get fair deal.. The trends of industrialization in the early stages have following featuresLoss of Freedom Unhygienic working conditions Employment of children Suppression of rights Since the workers were unorganized and had no bargaining power, the factory owners suppressed them. Gradually, with the initiative of social and political workers, the trade unions were formed to protect the workers. The factors, which necessitated the trade unions to come into existence, may be described as under: Commanding position of employer. Large-scale recruitment of workers Introduction of division of labour Growth of specialized workers Monotony in jobs increase in accident and no compensation Employment of children Payment of lower wages Unhygienic working conditions Lack of welfare measure The things were becoming complicated day by day. To overcome the above problems and to have better industrial relations, several management thinkers contributed and though of human relations in industry. The name of Robert Owen, Charles Babbage and Daniel C. Macallum are worth mentioning.

Growth of Trade Unionism. The problems as we have discussed earlier gave an opportunity to workers to form trade unions so that the working conditions of the workers are improved. The trade unions have played a vital role in establishing a machinery to resolve dispute of workers relating to working hours, holidays, job duties, job rights, discipline and other grievances. The trade unions influenced the employers in U.S.A. to a greater extent. Several employers in that country appointed a number of welfare societies and have invested heavy sums to take welfare activities in an organization for workers. In several companies personnel department were set up for recruitment and following activities for the welfare and proper functioning of the company In India, the foundation of modern industries was laid down between 1850 and 1870. Indian enterprises started growing side by side with the British one in all spheres of the national economy. During the period of growth of Indian Capitalist enterprises, the working and livings conditions of workers were poor and their working hours were long. The first indication of industrial unrest and work stoppage was in the year 1977 in Empress Mills, Nagpur. Though there was no trade union, the relations between workers and employer cannot be said to be peaceful. There were short-lived strikes in Bombay and Surat. The suppression of the workers by the employers continued, the workers were intimidated, dismissed and victimized even in case of mild disputes. On going through the records we find that in 1895 the workers struck working of the Budge Jute Mills resulting in loss of Rs.18000/-. There were hardly any laws to protect the interest of the workers except the Employers and Working (Dispute) Act, 1860, which was used for settlement of wages. In 1881, the Factories Act was ed which awakened the workers to have concerted approach to settle their disputes. Whatever trade unions emerged or workers organization came into existence, were purely of local levels. The first emergence first strike may be recalled of textile workers in Ahemdabad under the leadership of Mahatma Gandhi. Textile Labour Association was born in 1920. Government also became aware of the grievances of the workers any intervened in a number of cases. This way there became three actors of Industrial relations viz. employer, employee and Government. Almost at the same time International Labour Organization (ILO) was constituted with the objective to regulate the working conditions, fixation of

minimum wages and for making provision of other benefits to the labour so that the employer and good industrial relations stop exploitation. The International Labour Orgainsation worked with the following aims and objects (1919 under League of Nations) ;_

1. The regulation of hours of work and elimination of unemployment. 2. The maintenance of just and fair condition of labour irrespective of caste, creed and sex. 3. The provision of adequate wages 4. The promotion of moral, social, political and cultural welfare of world peasants. 5. The protection of workers against sickness, disease and injury. 6. The protection of children and young person and bringing of the female labour upto the level of male labour. 7. The provision of old age pension 8. The protection and guidance of workers against exploitation of capitalist /employers. 9. The organization of professional and technical education and recognition of principles of freedom on Association.

In 1944, the ILO adopted the following principles:1. Labour is not commodity 2. Poverty anywhere constitutes danger to prosperity everywhere. 3. The freedom of expression and formation of Association 4. The war against want.