Submitted: Shubhanshu Gupta PGDM IV sem

Definition Trade Union

Indian Trade Unions Act 1926, defined trade union as any combination of persons, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workers and employers, or between workers and workers, and for imposing restrictive conditions on the conduct of any trade or business, and includes the federation of two or more trade unions.

Characteristics of Trade Union

It is an association either of employees or employers or of independent workers.

It is a relatively permanent combination of worker

It is an association of workers engaged in securing economic benefits for its members. The character of trade union has been constantly changing.

Principles of trade Unionism

Unity is strength

Equal pay for equal work

Security of service

Union Structure
The structure can be classified into four types Craft Union: workers of the same craft or category of the job form into an union. General Union: workers of any industry, any region and of any job form into one union Industrial Union: workers of different categories form into a union Federation & Confederation: industrial unions, either of same industry or of the different industry may form into an association in order to improve their strength.

Why do Workers Join A Trade Union

To get economic security

To improve their bargaining power and balance it with that of management To communicate their views and frustrations to the management

 To secure protection from economic hazards beyond

their control, e.g.-illness, accident.

To satisfy their social needs

To satisfy their psychological needs

To satisfy their needs for a sense of belonging.

Function of a Trade union

Objectives
Wages and salaries Working conditions Discipline To protect the workers from the managements unilateral

acts and disciplinary policies; Penal Transfers Suspensions Dismals etc

Personnel policies

 Welfare Employee-employer relations

Harmonious relations
Bureaucratic attitude Unilateral thinking Negotiations

Negotiating machine

GIVE AND TAKE RELATION Safeguarding organizational health and the interest of the industry.

How are the Objective Achieved

Collective bargaining
Union security Grievance processing and handling procedures

Negotiated Agreement
Arbitration Political pressure through legislators

Mutual insurance

(common contributions)

The Trade Unions Act,1926 and Legal Framework

It legalize the formation of a T.U by allowing the members

the right to form and organize unions. Agree to abide by the provisions. If the existence is for more than 1 year then, an application of the assets and the liabilities must be submitted. Application contains: Names, occupations, Address Name Of The Union, Its Head Office Details About Office Bearers.

Status of A Registered Union

A corporate body.
A common seal. Buy and hold movable and immovable property. Enter into contracts with others. Sue and be sued in its name.

Cancellation of Registration
On the application by the union.

Where the application was obtained by fraud or mistake.

Where the union has ceased to exist. Where it has willfully and after notice from the Registrar

contravened any provisions of the Act or allowed any rule to continue in force which is inconsistent with any provisions of the Act. Where the union has rescinded any rule providing for matter, provision for which is required by Section 6. Where the primary objects of the union are no longer in agreement with the statutory objects.

Obligations
Allow anyone above the age of 15 years to be a member

of the union. Collect membership fees not less than 25 paisa per month and per member. Specify that 50% of office bearers must be from the persons actually employed. Maintain membership register. State the procedure for change of its name, merger and its dissolution. Spend uniform funds for the purposes specified in the act.

Rights
Claim immunity from civil and criminal prosecution

for bonafide trade union activities.

Create a political fund . Spend general funds on salaries of staff,

other expenses.
Can represent workers to the works committee.

Liabilities
A registered union should maintain books of account

and a list of members. Should keep books and the list open for inspection by members Should have office bearers who do not suffer from the disqualifications prescribed under the T.U Act,1926. Should submit statements of receipts, expenditure, assets , liabilities. Should give correct information to persons intending to become members.

Conditions for Congenial Industrial Relations

Existence of strong, well organised and democratic

employees union
Existence of sound and organised empolyers union
Spirit of collective bargaining and willingness to resort

to voluntary arbitration
Machinery for prevention and settlement of industrial

disputes

Collective Bargaining
Preparation for negotiations
Identifying bargaining issues W age related issues Supplementary economic benefits Institutional issues Administrative issues

 Negotiation Settlement and contract agreement

Administration of the agreement

Settlement of disputes
Conciliation- a process by which representatives of
workers and employers are brought together before a third party with a view to persuading them to arrive at an agreement by mutual discussion between them.

Adjudication- a mandatory settlement of disputes by

labour courts or industrial tribunals or national tribunals under the industrial disputes act or under any other corresponding state statutes.

 Voluntary arbitration- a procedure in which a

neutral third party studies the bargaining situation, listens to both the parties and gathers information, and then makes recommendations that are binding on the parties..

Joint Consultation
Works committee- a group wherein 100 or more no.
of people are employed, and there should be equal no. of employer and employee representatives.

Joint Management Council- it comprises of the

representatives of the management, technicians and workers.

Weaknesses of Trade Union

Trade Union Leadership:

(Outside leadership, mainly drawn from political parties)

Reasons:
Inability of insiders to lead their movement Low education standards. Poor command over English language. Low level of knowledge about labour legislation. Unsound financial position.

Evil Effects
Outside leadership undermines the purpose of trade

union and weakens their authority.

It is responsible for the slow growth of trade union. Internal leadership has not been developed fully. Most of the leaders cannot understand the workers

problems as they do not live the life of workers.

Measures to Minimize the Evil Effects of Outside Leadership:

Management should assure that the victimization will

be at zero level even if the trade unions are led by INSIDERS.

Extensive training facilities, in the areas of leadership

skills, management techniques, and programmers should be provided to the workers.

Special leave should be sanctioned to the office

bearers.

 Multiple Union: It poses a serious threat to industrial peace and harmony in India. Finance: Sound financial position is an essential ingredient for the effective functioning of a trade union. In the process of rendering services or fulfilling their goals, trade unions have to perform a variety of functions and organize programmers which require enormous financial commitments. Union Rivalry: Inter union rivalry Intra union rivalry

Other Problems
Illiteracy
Uneven growth of trade unions. Heterogeneous nature of labours. Lack of interest.

Recommendations of the National Commission on Labour

The number of outsiders in a trade union should be

limited to 30% in the case of trade unions whose membership is drawn from a particular industry...
All ex-employees should be treated as INSIDERS. There shouldnt be any BAN on NON-EMPLOYEES

holding positions in the executive committee of a trade union.

 Steps should be taken to promote leadership from

among the members of the working class and enable them to assume a responsible role in trade union activity. Penalties may be legally provided to curb a management's policy of victimization and similar unfair labour practices which prevent the emergence of internal leadership. The registration of trade union should be cancelled when When its membership falls below the minimum prescribed for registration

 It fails to submit its annual returns It does not rectify the defects in time when defective

returns are submitted.

The application for re-registration from trade union

should not be considered within 6 months of the date of the cancellation of registration.
The membership fee for the trade union should raised

to 1 rupee/month.

Retrenchment
Reducing the size of the organization or reducing number of employees in the organization is called downsizing or retrenchment. Downsizing is a critical decision take by organization and human resource management have important role to play in this context. This pattern seems to represent a churning of employees. Organizations were laying off employees with outdated skills or cutting whole businesses that were in declining markets while simultaneously building businesses and employee bases in newer, higher-growth markets. Initially layoff refer to the temporary suspension of the employees but now this term also refer to the permanent suspension of the employees.

 Reasons of Downsizing

Organization take downsizing decision due to several reasons some of them are mention below. Mergers When two organization in same industry take the decision to combine their resources for exploiting opportunities and reduce their cost. Downsizing take place in mergers because their are more than one person for the single position, so company have to take rational decision to layoff some employees. Acquisition One organization purchase other results in change management. Mostly stakeholders take decision to layoff employees to cut the cost and Increase revenues and profits.

 Economics crisis

Recession or depression lead to the financial crises in the organization. To avoid losses organization have to reduce the number of employees. Change management Processes, procedure or higher management change can also result in downsizing. Optimization Due to intense competition companies sometimes aimed to increase revenues and profit to benefit the shareholders. In order to do this companies take the step of downsizing for maximum utilization of human resource.

Human resource management role in downsizing

All employees should be informed why the downsizing is

necessary, what costs are to be cut, how long the downsizing will last, and what strategies the organization intends to pursue. Human resource management play vital role in downsizing to communicate the message in a right way that it will not harm organization image and employees have positive perception after leaving the organization. Downsizing also impact on the mind of employees working in the organization they feel insecure about their job. HR managers should tell all the employees that their job are secure. Human resource department should assist the layoff employees in finding other job.

Alternatives of downsizing
Organization to avoid downsizing can take the following step.
Part time Job

Cut the number of job hours and pay employee on hourly basis to engaged him with the company. During his free time he can do any other work for earnings. Work at home Give access to the employees to work at home rather then coming at office. This step will reduce the operational cost of the organization. Shift of department One business unit of the organization is not doing well, organization can shift the employees to other business unit. Outsource Employees Organization can provide outsourcing services is specialized domain so their employees can work on other company projects.

Exit Policy
Exit policy refers to the policy regarding the

retrenchment of surplus manpower resulting from restructuring of industrial units or the workers becoming unemployed by the closure of sick units.

Need for exit policy

Surplus Manpower :-There is disguised unemployment

if some labor employed in an enterprise can be withdraw without adversely affecting the production .
In sellers market which existed in India under the

protected economic system the costs of surplus manpower employed by the companies could be passed on to the consumers by way of high prices.

VRS & Golden Handshake

Voluntary Retirement Scheme(VRS):-Employees who

attained forty years of age or ten years of service would seek voluntary retirement .
While golden handshake scheme offered by some

companies in past worked very well, the offer made by some other companies failed to elicit the required response from the employees.

NationalRenewal Fund
To provide assistance to firms .

To provide funds for compensation to employees.

To provide funds for employment generation schemes.

Conclusion
The main objective of exit policy is to protect the

interest of the workers.

THANK YOU