1

1
5. Trade Unions as Actors
in the HRM system:
Debi S. Saini
Professor of HRM
Management Development Institute, Gurgaon
2
Trade Unions as actors in HRM System
Objectives of this session are to discuss the following:
Nature and meaning of trade union
Role and functions of trade unions
Overview of the Trade Unions Act 1926
Rights & liabilities of a trade union
Issues in recognition of unions
De-unionization strategies of employers
What should Indian unions do to remain relevant in todays era
2
3
Meaning and Nature
of
Trade Unionism
4
Meaning of Trade Unions
Nature
Unions: A major component (actor) of IRS
Meaning:
Anorganization
formed by employees
toprotect their interests
including improving working conditions
3
5
A Working Definition: (Salamon, 1998)
Anyorganization,
whosemembership consists of employees,
which seeks toorganize & represent their interests
both intheworkplace andsociety
and in particular,
seeks toregulate theemployment relationship
through the direct process of
collective bargaining with management
6
Union Goals and Philosophy
Business Unionism Business Unionism
Social (Reform) Unionism Social (Reform) Unionism
Practice of unions Practice of unions
seeking to improve seeking to improve
the wages, hours, the wages, hours,
and working and working
conditions conditions
in a businesslike in a businesslike
manner manner
A characteristic of A characteristic of
unions seeking to further unions seeking to further
members interests by members interests by
influencing the social, influencing the social,
economic, and legal economic, and legal
policies of policies of
governments governments
4
7
Union Structure and Function
National/Intl. Unions National/Intl. Unions
Many local unions are part
of a larger national or
international union
(e.g. ICFTU)
Local Unions Local Unions
Basic unit of union
organization formed in a
particular plant or
locality
Craft Unions Craft Unions
Composed of workers who
possess the same skills or
trade
Industrial Unions Industrial Unions
Includes the unskilled
and semiskilled workers
at a particular location
8
Trade Unions Act 1926
5
9
Trade Union under TUA: Definition
2 (h) Trade Union means
any combination, whether temporary or permanent,
formed primarily for the purpose of
regulating the relations between
workmen and employers,
or between workmen and workmen,
or between employers and employers,
or for imposing restrictive conditions on
the conduct of any trade or business,
and includes
any federation of 2 or more TUs:
10
T U Act 1926: Components
The Act consists of 33 sections: Deals with these:
Regis.Rights/liab.RegulationsPenalties/procedures
Extends to whole India: Provides registration/immunities
Act amended in 1948 to provide for recognition
But never notified by Government
Act amended in 2001: Checks multiplicity
Administered by appropriate government
6
11
Salient Features of TU Act 1926
1. Provides who can register a T.U.:
Any 7 or more WM employed in industry/ trade can
Later added: At least 10% or 100 whichever is less
2. Registrar of TUs: in each stateprocedure for regis. Appeal
3. Min. subscription: Rs. 1/ 3/ 12 p.a. (Rural/Unorganized/org. sectors)
4. Envisages general/political funds of a TU: Politicization
5. Outsiders permitted as TU members
6. Rights of TUs: Immunities to TU/members (Criminal/civil)
7. Obligation of TUs envisaged: Also to file returns
12
TU under the TU Act 1926
2 (h) Trade Union means
any combination, whether temporary or permanent,
formed primarily for the purpose of
regulating the relations between
workmen & employers, or between WM & WM,
or between employers and employers,
or for imposing restrictive conditions on
the conduct of any trade or business,
and includes
any federation of 2 or more TUs:
7
13
Role
of
Trade Unionism
14
Why Unions Evolved
1. Easy to fight for rightscollectively
2. Innate peopledesire to seek protection
Desire increases with social/political/economic advancement
3. Unions as footholds to political parties
4. Employers find it easy to deal with groups
5. Countervailing power: social legitimacy
8
15
Unions: Broad Areas of Functions
Exercise of Power: Key Function
A TU is first & foremost
a medium of power (R. Hyman)
Sources of power:
Itsresources
Negotiation skills
Collection strength
Political support
Unions do research on: economy, court cases

16
Determinants of Trade Unions Power
TUspower in labour movement, depends on:
Its SizeLeadership qualityAlliance between unions
TUspower towards Govt.:
Depends on Govts desire to support
Its power towards employers depends on:
Union densityEconomic, technological, political factors
9
17
Union Power used for Various functions
1. Economic Regulation
Protectingterms & conditions Fighting against PRP
2. Job Regulation
Joint rule-making WM dignity Attack on this by HRD/EI
3. Social change
Adopting political role: ILC, strikes, ILO, laws, advisory boards
4. Member services
Welfare servicesWM Educationorganizationinformation
5. Self fulfilment: Mechanismto individuals to develop leadership
18
History of
Trade Unionism
In India
10
19
Early History of T. U. in India
Earliest TUs organized: Bombay, Calcutta, Madras
Industries: Cotton textiles, jute, railways
One of 1st lab orgs.: Bombay Mill Hand Assn.
Formed in 1890: was a welfare organization
Gandhis satyagraha: Ahmedabad in 1917:
50% wage hike demanded: RejectionStrike
Gandhiji said: 35% fairWM pledged for strike
Gandhiji on fast after 3 weeks of strike: Accepted
This was 1st major union success: Fillip to unionism
20
Early History of T. U. in India contd
1st TU: Madras Lab Union (1918: by BP Wadia)
Organized WM of Binny Mills Ltd.
TLA: organized in 1920 by AnsuyabenSarabhai
Madras Labour Union strike call in 1920
Suit for damages/injunction
Damages awarded: Rs. 75000, Union held a conspiracy
Binny Mills (Mad HC) case: led to TU Act in 1926
Unionism accepted also due to check spread of communism
11
21
Why Outsiders in Unions
1. Low union participation & lack of interest
2. Poor earnings and lack of leisure time
3. Political parties' attempt to widen base
4. WMs need protection against ULPs
5. Need for negotiators, legal knowledge
6. Instability of workforce/illiteracy/fear of victimization
7. Under-developed class-consciousness
22
Union Substitution
In the Era of
Globalization
12
23
Union-Substitution Policy of Larger Firms
Union substitution policies of some firms: IBM / Kodak
This is typical HRM model
Offering attractive package to employees
Competitive pay
Communication, involvement, info sharing
Induction programme to develop orgl. ethos
Training, career development
Commitment by providing satisfying work
For success, HRM model should:
Fit core values of the organization
Reflect integrated approach
24
Unions in Crisis: Causes
States covert primacy toproductivity
Unitarist/individualized IR: gold-collar WM
Declining employmentautomation
Emergence of service organizations
New tech.white- & Gold-collar WM
Home working
Emergence of lean, mean, green organization
Taylorism to Toyotaism: flexible specialization
Decline in core; rise in peripheral workforce
Employment of labour law consultants
Unipolar world andPost-capitalist society
13
25
Change in ILOs raison detre
ILOs desire for adaptation, renewal, change
Adversarial tripartism to sophisticated unitarism
--through new paradigm:
Securing decent work for women and men everywhere
Unity of purpose of the three constituents
Four strategic objectives:
--Fundamental principles and rights at work
--Employment
--Social protection
--Social dialogue
26
What Should Unions Do
to Remain Relevant
in New Era?
14
27
Agenda for Unions in New Era
1. Need to retain political unionism in India
--MakeAlliances with other union federations
2. Fight withstate for rights of contract labour
3. Organizeunorganized labour: SEWA/Gramin Bank
4. Workers education & skill development
28
Agenda for Unions in New Era contd
5. Cooperate withindustry but befirm on rights:
--Accept HRM philosophy
6. Understand needs of workers in BPO/IT
--Try toprovide them service that they need from a union
7. Focus on existinglabour law enforcement
8. Curbbrief-case trade unionism; improve image