Worker’s Participation in

Management
in India

BY NISHAT
MBA 3RD SEM
 WORKER’S PARTICIPATION IN
MANAGEMENT
It is a mental and emotional involvement of
a person in a group situation which
encourages him to contribute to goals and
share responsibility with him.
workers’ participation in management
means giving scope for workers to
influence the managerial decision making
process at different levels by various forms
in the organisation.
 Evolution
Evolution of participative management in
India:
In 1920 Mahatma Gandhi had suggested that
workers contributed labour and brains, while
shareholders contributed money to enterprise, and
that both should, therefore share in its prosperity.
The influence of Mahatma Gandhi bore fruit and for
the first time Joint Consultation was adopted in the
Cotton Textile Industry.
The first major step came during the enactment of
Industrial Disputes Act, 1947.
The Industrial Policy Resolution had suggested that
labour should be consulted in all matter concerning
industrial production.
Further the scheme of Joint Management Council was
formulated in 1957.
 Evolution in India
A Study Group on Workers Participation in
Management, consisting of representatives of the
Government, employers and workers was set up in
1956, it favoured the system of Joint Management
Councils and submitted its report in 1957 emphasising –
– In India, an education campaign should be launched so that
workers and managerial supervisory staff may realise the
implications of such a scheme
– The joint consultation should be “in-built”
– Importance should be given to reorientation of attitudes, strong
self-confident trade unions and good industrial relations
– No compulsion should be applied, only permissive legislation be
favoured in setting up the councils
 View of Various Committees on WPM
Sachar Committee – In June 1977, a high-powered expert
committee on Companies and MRTP Acts was set up by the
Government of India under the chairmanship of Rajinder
Sachar. The terms of reference for the Committee were:
To consider the provisions of the Companies Act and MRTP Act
To suggest measures by which workers participation in the share
capital and management of companies can be brought about.
Representation of Workers on Board of Directors
Workers participation in Share Capital
Varma Committee – Janata Government set up a committee in
September 1977, under the chairmanship of Ravindra Varma.
This committee also emphasised on Representation of Workers
in Management but equity participation was recommended as
optional.
 Objectives
In the words of second five year plan
- to increase productivity for the
general benefit
- to give employees a better
understanding
- to satisfy the worker’s urge for self
expression
 The participation of worker in
Management Bill 1990
In Rajya Sabha on 30 may, 1990
The bill sought to provide for specific
and meaningful participation of
workers in management from shop
floor to the board level in all
industrial establishments defined
under Industrial Disputes Act, 1947.
Forms of worker’s participation in
India
Works committees
Joint management councils
Joint councils
Unit councils
Plant councils
Shop councils
Worker’s representative on board of
management
Worker’s participation in share capital
 WORKS COMMITTEE
It consists of equal number of representatives of
both employers and workers. It meets frequently
for discussion on common problems of the
workers and the management. After discussion,
joint decisions are taken and such decisions are
binding on both the parties. Matters like wage
payment, bonus, training, discipline etc are
discussed in such meetings.
 JOINT MANAGEMENT
COUNCIL
It involves setting up of joint committees
represented by the workers and the management
to discuss and give suggestions for improvement
with regard to matters of mutual interest. The
decisions of such committees are not binding on
either party, yet they are implemented as they
are arrived at by mutual consultations. The
subject-matter of joint consultations includes
such problem areas as labour welfare, safety
measures, grievance redressal, training, working
hours, etc.
 Joint Councils
Features –
- Each organization/ service shall decide the
no. of councils.
- Only engaged persons are members
- The tenure of the councils should be 2 years
- Chief executive shall be the chairman
- Secretary should be appointed
- Meeting at least ones in a quarter
- Decisions based on consensus not by voting
 Functions –
- Settlements of matters
- Review of working of the unit level
- Unit level matters having bearing on
in other branches or on enterprise
- Development of skills
- Improvement of general conditions of
work
- Preparation of schedules of working
hours and holidays
- Proper recognition and appreciation of
useful suggestions of workers
 Unit Councils
Features –
- A unit level council
- Equal no. of representatives of management and workers
- Management representative should be nominated by
management and should consist of persons from
concerned unit
- Implemented within a month
- Secretary appointment
- Decisions should have bearing on other unit of the
organization
- The council once formed should work for three years
- Meeting at least once in a month
- Chairman from management, vice chairman from
workers
 Plant Councils
Formed in pursuance of the recommendations of
the second meeting of the Group on labor at New
Delhi on 23 Sep, 1985.
Features –
- One plant council for the whole unit
- Member not less than 6 and not more than 18
- Member should be engaged in the unit
- Tenure is 3 years
- The chief executive of the unit shall be the
chairman of the plant council
- Secretary should be appointed
- Meeting at least once in a quarter
- Decisions should be based on consensus
 Function of Plant Council
Operational areas
Economic and financial area
Personnel matters
Welfare areas
Environmental areas
 Shop Councils
Features –
- For every unit of 500 or more workers
- Equal no. of representatives of employers and
workers
- All the members should be concerned with unit
- Total no. of members may not exceed by 12
- Decisions based on consensus
- Implement within a month
- Meeting within a month
- Tenure is 3 years
- Chairman from management and vice chairman
from workers
 Function -
- To assist in production target
- To improve working
- Corrective steps
- To study absenteeism and reduced it
- To suggest safety measures
- To assist in maintaining general discipline
- To suggest improvement in physical
working conditions
- To suggest welfare and measures
- To ensure two way communication
- To suggest technological innovation
- To assist in implementation of cost
reduction program
 Worker’s Representation on
Board of Management
On the recommendations of the Administrative Reforms Commission
made in its report on public sector undertakings, the Government of
India accepted, in principle, that representatives of workers should
be taken on the Board of Directors of Public Sector enterprises.
Features –
Participation should be limited to companies which employ
1000 or more
The Worker Director shall be elected through a secret ballot
Presence of Worker Director on the Board shall not lead to
any breach in the confidentiality of the information required
Functions –
The Worker Director participates in all the functions of the
Board, beside they also review the working of shop and plant
council
 Conclusion
Scheme should be made to work at
least in the field of increasing the
production and productivity of labor.
Workers may get reasonable
opportunity to show his work in
contributing to production targets.
Management should have a
constructive attitude and should
regard trade unions as a highly
valuable and powerful struments.
Both employers and unions should
have proper sprit.
The govt. should take responsibility
for workers education programs.