Theories of Industrial Relations Final

THEORIES OF
INDUSTRIAL RELATIONS
D.Shiva Prasad
definition
 Industrial relation is a relationship between
management and employees or among employees
and their organizations that characterize and grow
out of employment.
 In a work setting “who offer their services are”
workers.
 Those who utilises these are the employers.
 Their economic interest primarily brings workers to
work for wages and the employers hire their
services as a factor contributing to production.
 The relationship between labour and management
is based on mutual adjustment on interest and
goals.
 It depends upon economic, social and
psychological satisfaction of the parties.
 Higher the satisfaction ,healthier the relationship.
 In practice, both of them augment their respective
income and improve their power position.
 The major issues involved in industrial relation
process are terms of employment .
Includes:
 Wages ,dearness allowances,bonus,fringe benefits, working
conditions ,leaves,health,safety ,job security and welfare.
 This is all the more so in view of the fact that resources are
limited.
 This may lead to simple negotiations or war fare which
effects the community’s interest in maintaining he un
interrupted and high level of production.
 Industrial relations do not have a shape of their
own,and do not have any fixed level.
 It depends on the forces of the market.
Protective IR -- controlled market
regulated IR -- organized market
dynamic IR -- competetive market
Approaches to industrial relations
 Unitary perspectives.
 Pluralistic perspectives.
 Radical perspectives.
Unitary perspectives
 It is based on the assumptions that integrated group
of people with a single authority structure and set
of common values, interests and objectives shared
by all members of the organizations.
employee
Trade unions
employer
Unitary perspectives
 Conflict is perceived as an irrational activity.
 It legitimates its authority role by projecting the
interest of management and employees being the
same and governing in the best interest of the
organization as a whole.
Pluralistic perspectives
 It is based on the assumption that the organization is
composed of individuals who grouped in to a variety of
sectional groups, each with its own interest ,objectives and
leadership.
 The organization perceived as being multi –structured and
competitive gives rise to “ complex of tensions and
competing claims which have to be managed in the interest
of maintaining a viable collaborative structure.
Conflict resolution
 Choices:
 Coerce: only one side gets what it wants.
 Conflict: while both sides spend more energy while
only one side usually has marginal gains.
 Compete: one party wins other loses.
 Compromise: no one get what they want.
 Collaborate: both parties evolve an option that provide
for mutual gain.
 Obviously, collaboration is the most preferred method,
collective bargain method leads to win-win situations
and mutual gains.
 Collaborating through:
.Sharing information
.Consulting each other on regular basis, brain
storming together.
Radical/marxist perspective
 It assumes that the organization exists with in a capitalist society
where “the production system is privately owned, profit is the key
influence on company policy..,control over production is enforced
by the owners.
 Conflict arises primarily from the disparity in the distribution of
,and access to economic power with in the society-the principal
disparity being between those who own capital and those who
supply their labour.
 Employers dominates the trade unions and employees.
Comparative picture
Unitary Pluralistic Marxist/radi
cal
assumptions Integrated group of Sectional groups, Division between
people, common different labour and capital,
intersts,values,objec values,interests,obje imbalance in values.
tives ctives.
Nature of Irrational Ineviatable,r Inherent in

conflict (not ational,and social and
expressible) structural. economic
system.
Resolution of Coercion Compromise Change in
conflict ( forcefully) and society.
agreement
Objectives of industrial relations
 The development of healthy employer-employee
relations.
 Maintenance of peace and high productivity.
 Improvement in economic conditions of workers.

Industrial relations post globalisation period (1991)
to till date..
After globalization:
 Core sectors opened for private sectors.
 MNC’s and FII’s are allowed to invest in India in non-
strategic Sectors.
 Disinvestment of PSU’S.
 Markets become more cost- effective, quality and
customer concern.
Changes in industrial relations
 It became union free employees relations.

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THEORIES OF

Nature of Irrational Ineviatable,r Inherent in

 Improvement in economic conditions of workers.

 MNC’s and FII’s are allowed to invest in India in non-

 Markets become more cost- effective, quality and

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