INDUSTRIAL RELATIONS

PROJECT

Title 1: IR policy of Tata Steels

Title 2: Industrial Revolution and five

personalities in it

By

B Kripasini

II-MBA
 Project 1: IR Policy of Tata Steels

Tata Steel, one of the largest employers of blue-collar workers in the country, has successfully
maintained cordial and productive relationships with its workforce through effective Industrial
Relations management for more than a century. This is largely attributed to the Management’s
concern for its employees and the pre-emptive yet symbiotic attitude of the labour unions. In
Jamshedji Tata’s own words, “We do not claim to be more unselfish, more philanthropic than other
people. But we believe in sound and generous business principles and regard the health and the
welfare of our employees as a sure foundation of our prosperity". Throughout the history of the
organisation, the industrial relations setup in Tata Steel has set many labour standards and
precedents. The structure, dynamics and orientation of IR in Tata Steel has witnessed drastic
changes over the years and the same will be covered in the following sections. Also, in spite of
measures such as wages regulation, participatory decision making, etc., the relationship between
company and labour has not been without discord and drama.

Formation of TWU and TEU:

Trade unions were formed in Tata Steel in the early 1900’s for the same reason unions were being
formed elsewhere in America and Europe – growing dissatisfaction amongst the workers and the
need to have a collective say and representation for the labourers. As a result of this, the trade
unions were formed as early as in 1920’s under the aegis of freedom fighters such as Netaji Subash
Chandra Bose and Rajendra Prasad, to name a few. The formation of trade unions was given further
impetus in the freedom struggle against British colonialism. One of the earliest trade unions, Tata
Workers Union (also alternatively known as Jamshedpur’s Workers’ Union) was formed in 1920.
TWU is politically affiliated to the Indian National Trade Union Congress (INTUC) and is the
most powerful trade union at Tata Steel and Jamshedpur today. TWU further came to the forefront
during the 1942 Quit India Movement. Apart from TWU, another union which holds considerable
sway in the organisation is the Tata Employees Union (TEU) formed in 1935. There are two ranks
of workforce at Tata Steel, i.e., officers and non-officers (workers who work in mines and plants
and staff members). TWU has representation of both the classes whereas TEU consists of officers
only. Though only TWU is recognized by the management for the purpose of collective
bargaining, the domains of negotiation are clearly demarcated for each union.
Tata Steel and TWU:

Apart from the strike of 1956 (when Communist Party tried to usurp the Congress affiliated TWU)
and the disruptions during Quit India Movement in 1942 when work was suspended, the overall
scenario has been harmonious. The 1920’s unrest finally led to resolution of critical matter such
as increase in wages, introduction of fringe benefits such as Provident Fund and recognition of
TWU. This was marked with intervention of leaders like Gandhi and resulted in better working
conditions, safety measures, etc.

Consolidation of the Movement:

Marked with appearance of leaders such as Prof. Abdul Bari, the period from 1930s to 1940s saw
the union taking deep roots into the culture of organisation. It was a period marked with strikes
and negotiation and resulted in revised wage structure, revised bonus schemes, systematic
relationship with management, etc. It was also the period of formation of joint committees (which
exist to date) between trade union and management for better communication and negotiation.

Era of Constructive Trade Union Movement:

After Prof. Abdul Badri, Shri Michael John took over as the leader of the TWU. His tenure and
subsequent years saw windfall gains for the trade unions and many collaborative agreements with
the management. One such as agreement was the Agreement of 1956 between Tata Steel and
TWU. This agreement saw the formation of a three-tier program of association between the union
and management for better dispute redressal and negotiation for terms and conditions for working
conditions, benefits such as education, medical facilities, etc. At the bottom level was the Joint
Departmental Council responsible for representation purposes. At the next level was the Joint
Workers Committee and at the top level was the Joint Consultative Council of Management.

Between 1920 and 2008, a total of 19 agreements have been signed between Tata Steel and TWU.
TWU presently has membership of over 93% of Tata Steel employees. It is the only recognized
union by Tata Steel. All benefits (financial, fringe and social) have been gained through peaceful
means and there has been no industrial strike in TISCO since 1928. From a crude mechanism setup
as a reactive dispute redressal mechanism almost a century back, the trade unions and the
management of Tata Steel have come a long way to create an environment of harmony and
progressive relationship building.

Evolution of IR in Tata Steel

Every organization has got its own organizational culture. This is definable by the modes in which
the Industrial Relations Management policies are practiced. TISCO's first and foremost value is
the development of human resources and adequately compensated them. TISCO believes that
when the employees are well treated, then production and productivity increase will take care of
themselves. This philosophy is true as far as TISCO organization is concerned.

In Tata Steel, Personnel Management and Industrial Relations was never considered the monopoly
of the personnel manager. On the contrary, it was thought that every supervisor and officer is fully
responsible for looking to the welfare of the men who work with them. However, to look after the
labour matters, a special officer was appointed in Tata Steel as early as in 1923.

The seed of Industrial Relations Management in TISCO was sown by the appointment in 1946 of
a Deputy Agent (Personnel) and followed up a few months later by the setting up of Personnel
Division under a Director 0f Personnel in January 1941. The department, however, ran into
difficulties from an inadequate appreciation of its powers and functions; which, in the early stages,
remained undefined.

The relations between Management and Labour in Jamshedpur may be regarded as passing through
three stages. The first, roughly up to the end of the 'First World War’ was dominated by the Tata
attitude of imaginative sympathy and kindly concern for employees, but this attitude had not yet
been fully translated in action . The second, which was more or less co-extensive with the troubled
years after the War up to the middle thirties, was one of inadequate adjustment and some conflict.
The third stage saw the transformation of an attitude into a philosophy, its detailed application to
concrete situations, and the consequent improvement of relations all along the line.

From 1920s, the first stirrings of organized trade union movement were noticed in Jamshedpur.
As in the case of other trade union struggles in India, the one at Jamshedpur had a political origin.
The major landmarks in the trade union movement that started about this time were strikes of 1922
and 1928 in which Indian national leaders of eminence tried to intervene on behalf of workers and
lead them to wards a healthy trade union movement.

Since 1938, the trade union movement in Jamshedpur has been under one union leadership. But
the principal factor was the steel company which welcomed and assisted the growth of healthy
trade unionism by all means. It recognized the trade union, afforded those facilities for organizing
and raising funds and made all Industrial Relations decisions in close cooperation with them, as
evident from the collective bargaining agreements concluded between the union and management
on 4th June, 1938.

The last stage is closer association of employees with management in the nature of Joint
Consultations which has existed very successfully right from its date of inception in 1956 to date.

Currently, more than 25 trade unions exist in Tata Steel. Some of them are autonomous trade
unions while some are affiliated to Central trade union organizations, for example, CITU, AITUC,
etc. Be that as it may, these trade unions have barely any following among the laborers and
supervisors of Tata Steel. This is the essential purpose behind the non-political nature of the union.
At present only one strong trade union is existing since long called Tata Workers’ Union (TWU).

One of the earliest trade unions in India, the Tata Worker’s Union (TWU), came into being in 1920
initially as Jamshedpur Labour Association (JLA) during a prolonged strike at TISCO. Since then,
it has had a chequered career, characterized by occasional setbacks, full support from eminent
national leaders during pre-Independence days, political pressures, and a prolonged struggle for
worker’s rights. From its very inception, it has had the advantage of being headed by renowned
trade union personalities like Prof. Abdul Bari and Mr. Michael John.

The TWU has 85% membership, 14792 in numbers and is the sole bargaining agent and the only
recognized union in TISCO. Despite the existence of several other trade unions affiliated to central
federations, TWU, which is affiliated to the Indian National Trade Union Congress (INTUC) .

Interestingly, TWU is Asia’s richest trade union valued at INR 35 crore as of 2015. The
membership fee is INR 80 per month which is collected by the check-off method. The political
linkage of the union is pluralistic in nature. The office bearers have different political orientations,
with some being a part of Youth INTUC, while others are linked to BJP. But, the union still works
in complete harmony and there are no issues as such because of these linkages.

Important attributes of TWU:

 It has a written constitution

 It is legally Registered

 Affiliated to INTUC, and through INTUC it is affiliated to International Confederations of

Free Trade Unions, and a member of International Metal Worker’s federation.

Project 2: Industry Revolution and 5 Personalities in it

Industrial Revolution, in modern history, the process of change from an agrarian and handicraft
economy to one dominated by industry and machine manufacturing. These technological changes
introduced novel ways of working and living and fundamentally transformed society. This process
began in Britain in the 18th century and from there spread to other parts of the world. Although
used earlier by French writers, the term Industrial Revolution was first popularized by the English
economic historian Arnold Toynbee (1852–83) to describe Britain’s economic development from
1760 to 1840. Since Toynbee’s time the term has been more broadly applied as a process of
economic transformation than as a period of time in a particular setting. This explains why some
areas, such as China and India, did not begin their first industrial revolutions until the 20th century,
while others, such as the United States and western Europe, began undergoing “second” industrial
revolutions by the late 19th century.

A brief treatment of the Industrial Revolution follows. For full treatment of the Industrial
Revolution as it occurred in Europe, see Europe, history of: The Industrial Revolution.
Characteristics of the Industrial Revolution
Find out how the Industrial Revolution changed the world

The main features involved in the Industrial Revolution were technological, socioeconomic, and
cultural. The technological changes included the following:

(1) the use of new basic materials, chiefly iron and steel,

(2) the use of new energy sources, including both fuels and motive power, such as coal, the steam
engine, electricity, petroleum, and the internal-combustion engine,

(3) the invention of new machines, such as the spinning jenny and the power loom that permitted
increased production with a smaller expenditure of human energy,

(4) a new organization of work known as the factory system, which entailed increased division of
labour and specialization of function,

(5) important developments in transportation and communication, including the

steam locomotive, steamship, automobile, airplane, telegraph, and radio, and

(6) the increasing application of science to industry. These technological changes made possible a
tremendously increased use of natural resources and the mass production of manufactured goods.

There were also many new developments in nonindustrial spheres, including the following:
(1) agricultural improvements that made possible the provision of food for a larger nonagricultural
population,
(2) economic changes that resulted in a wider distribution of wealth, the decline of land as a source
of wealth in the face of rising industrial production, and increased international trade,
(3) political changes reflecting the shift in economic power, as well as new state policies
corresponding to the needs of an industrialized society,
(4) sweeping social changes, including the growth of cities, the development of working-class
movements, and the emergence of new patterns of authority, and
(5) cultural transformations of a broad order. Workers acquired new and distinctive skills, and their
relation to their tasks shifted; instead of being craftsmen working with hand tools, they became
machine operators, subject to factory discipline.
Finally, there was a psychological change: confidence in the ability to use resources and to master
nature was heightened.

The first Industrial Revolution

Industrial Revolution

In the period 1760 to 1830 the Industrial Revolution was largely confined to Britain. Aware of
their head start, the British forbade the export of machinery, skilled workers,
and manufacturing techniques. The British monopoly could not last forever, especially since some
Britons saw profitable industrial opportunities abroad, while continental European businessmen
sought to lure British know-how to their countries. Two Englishmen, William and John Cockerill,
brought the Industrial Revolution to Belgium by developing machine shops at Liège (c. 1807), and
Belgium became the first country in continental Europe to be transformed economically. Like its
British progenitor, the Belgian Industrial Revolution centred in iron, coal, and textiles.

France was more slowly and less thoroughly industrialized than either Britain or Belgium. While
Britain was establishing its industrial leadership, France was immersed in its Revolution, and the
uncertain political situation discouraged large investments in industrial innovations. By 1848
France had become an industrial power, but, despite great growth under the Second Empire, it
remained behind Britain.
Other European countries lagged far behind. Their bourgeoisie lacked the wealth, power, and
opportunities of their British, French, and Belgian counterparts. Political conditions in the other
nations also hindered industrial expansion. Germany, for example, despite vast resources of coal
and iron, did not begin its industrial expansion until after national unity was achieved in 1870.
Once begun, Germany’s industrial production grew so rapidly that by the turn of the century that
nation was outproducing Britain in steel and had become the world leader in the chemical
industries. The rise of U.S. industrial power in the 19th and 20th centuries also far outstripped
European efforts. And Japan too joined the Industrial Revolution with striking success.

The eastern European countries were behind early in the 20th century. It was not until the five-
year plans that the Soviet Union became a major industrial power, telescoping into a few decades
the industrialization that had taken a century and a half in Britain. The mid-20th
century witnessed the spread of the Industrial Revolution into hitherto nonindustrialized areas such
as China and India.

The technological and economic aspects of the Industrial Revolution brought about significant
sociocultural changes. In its initial stages it seemed to deepen labourers’ poverty and misery. Their
employment and subsistence became dependent on costly means of production that few people
could afford to own. Job security was lacking: workers were frequently displaced by technological
improvements and a large labour pool. Lack of worker protections and regulations meant long
work hours for miserable wages, living in unsanitary tenements, and exploitation and abuse in the
workplace. But even as problems arose, so too did new ideas that aimed to address them. These
ideas pushed innovations and regulations that provided people with more material conveniences
while also enabling them to produce more, travel faster, and communicate more rapidly.

The second Industrial Revolution

Industrial Revolution: factory workers

Despite considerable overlapping with the “old,” there was mounting evidence for a “new”
Industrial Revolution in the late 19th and 20th centuries. In terms of basic materials,
modern industry began to exploit many natural and synthetic resources not hitherto utilized:
lighter metals, rare earths, new alloys, and synthetic products such as plastics, as well as
new energy sources. Combined with these were developments in machines, tools,
and computers that gave rise to the automatic factory. Although some segments of industry were
almost completely mechanized in the early to mid-19th century, automatic operation, as distinct
from the assembly line, first achieved major significance in the second half of the 20th century.

Ownership of the means of production also underwent changes. The oligarchical ownership of the
means of production that characterized the Industrial Revolution in the early to mid-19th century
gave way to a wider distribution of ownership through purchase of common stocks by individuals
and by institutions such as insurance companies. In the first half of the 20th century, many
countries of Europe socialized basic sectors of their economies. There was also during that period
a change in political theories: instead of the laissez-faire ideas that dominated the economic and
social thought of the classical Industrial Revolution, governments generally moved into the social
and economic realm to meet the needs of their more complex industrial societies. That trend was
reversed in the United States and the United Kingdom beginning in the 1980s.

5 Personalities of Industrial revolution:

Edmund Cartwright (1743-1823) – English inventor, and member of the Anglican clergy.
Cartwright invented the power loom which significantly increased the efficiency of textile
production. He also developed a wool-combing machine.

Robert Owen (1771 – 1858) – Welsh social reformer who attempted to build a utopian socialist
and co-operative movement. Owen sought to consider the welfare of his workers, something
usually overlooked in the industrial revolution.
Sir Humphrey Davy (1778 – 1829) – English chemist and inventor. He invented the Davy lamp
used by miners to help detect gas and improve safety. He also discovered several alkaline earth
metals and discovered more about the chemical properties of chlorine and iodine.

George Stephenson (1781 – 1848) Mechanical engineer, who developed the steam engine for use
in trains. He was a key figure in building the 25 mile Stockton and Darlington railway. Stephenson
also built the first intercity railway between Liverpool and Manchester – ushering in the ‘railway
age’.

Joseph Locke (1805 – 1860) English civil engineer. Locke was an important railway pioneer. He
built the Grand Junction Railway which connected the Liverpool railway to Crewe and
Birmingham. He developed new techniques for laying rails and was considered better at finishing
projects than Stephenson.

Isambard Kingdom Brunel (1806 – 1859) English engineer. Brunel was at the heart of many of
the key building projects of the British industrial revolution. He built the Great Western Railway
from Bristol to London and also developed powerful steamships. He also built the first tunnel
under a navigable river.

Sir Henry Bessemer (1813 – 1898) an English engineer, inventor, and businessman. Bessemer’s
greatest contribution was to the mass production of steel, which was a key component of the second
wave of the industrial revolution.