Comparison Study of Industrial

Relations in Developed and De-

veloping Economies
Group 5 Presentation : Japan and India

Submitted by: Submitted to:

Tejaswani Rani (1191)
Widya Dwi Oktaviani (1208)
Lovepreet Kaur (1218)
Dr Azizinder Sekhon
Sanjana Chhabra (1198)
Baheerullah Haidarzai (1201)
COMPARISON OF IR
JAPAN V/S INDIA
India, is the country that occupies most of the Indian subcontinent in Southern Asia.
In terms of its population, India is one of the most populous nations in the world
(17.7%) slightly behind China(18.47%).
The Indian society reflects certain characteristics of collectivism, the basic cultural
orientations of India are profoundly rooted in Buddhism, Vedantic and Yogic
psychology, derivative epic and puranic literature. Indian management practices have
developed a distinct Indian flavour.
 Japan is the continent of Asia. Its country made up of many islands. The Japanese
refers to their country as “Nippon” or “Nihon” which means “Source of the Sun”.
The economy of India is the world’s Sixth largest economy by nominal GDP and the
third largest by Purchasing Power Parity(PPP).
Japan having population of 1.62% of world’s share is the 3rd largest in the world
nominal GDP and 4th largest by Purchasing power parity in 2020.
• Low unemployment rate indicates better career
opportunities and economic growth.

• The total labour force of a country represents the

number of people working or willing to work.
 LIFETIME EMPLOYMENT
Once an individual is given a job, he is employed for life. In the past, large-
sized companies recruited employees directly from schools and colleges and
trained them inside the company as a way to attain long-term sustained ser-
vices.
 Currently, they are recruiting mid-career and non-regular workers. To counter
challenges brought on by frequently changing technology and to minimize
long-term training costs, employers are seeking mid-career workers whose
readymade skills and abilities can immediately be put to use.
In 2019, The lifetime employment system is no longer sustainable, Hiroaki
Nakanishi, chairman of Keidanren (the Japan Business Federation) told a news
conference 
SENIORTY WAGE,PROMOTION SYSTEM
Pay in Japan is based on a ‘seniority-based system’ (nenkō joretsu chingin),
where an employee’s salary is increased in proportion to their seniority and
years of service.
Pay practices are undergoing changes. Many employers are adopting an
evaluation and wage determination practice that takes employee performance
into consideration.
In 2017, the average monthly wage for a person with 12.1years of experience
and an age of 42.5 was JPY 304,300 (€2,432 as at 31 January 2019). For men
the average monthly wage was JPY 335,500 (€2,682)&for women JPY 246,100
(€1,967).
 INTRODUCTION OF TRADE UNION

• A trade union is a group of employees who join together to

maintain and improve their conditions of employment.
• India has more than 84,642 registered trade unions along
with an unaccounted number of unregistered trade unions
scattered across a large spectrum of industries in India.
• While In Japan, the unionisation rate in Japan has been
considerably and continuously declining. This rate has been
less than 20% in the last fifteen years. As of June 30, 2017, 
the number of single trade unions in Japan was 24,465. 
• The largest national labour centre is the Japanese Trade Union
Confederation (RENGO); other well-known labour centres are
the National Confederation of Trade Unions (Zenroren) and the

National Trade Union Council (Zenrokyo). These organisations

serve as a voice for members in national politics. They are
connected with certain political parties and sometimes affect
legislative politics.
• Today, the Bharatiya Mazdoor Sangh (“BMS”) by BJP, the
Indian National Trade Union Congress (“INTUC”) and the All
India Trade Union Congress (AITUC) are considered to be the
largest trade unions in India.
HOW TRADE UNION WORKS IN
JAPAN & INDIA
 History

After World After World

In the Late
War I War II
1880s

UNORGANIZED Japan became a founda- trade union membership grew

tion member of the Interna- rapidly & reached a peak of
tional Labor Organization 6,655,000 members in 1949
(ILO)
 Union Type & Structure
Type: Structure:
INDUSTRIAL BUSINESS
UNION UNION

The enterprise structure of Japanese

The unionization rate varied significantly
unionism means that the major objec-
by industry included electricity, gas and
tives of these unions have been the pur-
water, government, financing and
suit
insurance around 50% while real estate,
of economic goal such as job security,
agriculture, and the service sector had
increased wages & improved working
rates of unionization below 10%
Trade Union Federation

RENGO

ZENROREN

ZENROKYO
 What do Unions do?
SPRING WAGE OFFE
NSIVE
SHUNTO ! FAILED !

The Social Agreement on “Workers would accept

Employment. shorter working hours
and lower wages”
 Present Condition
Trade union membership 2013–2017
  2013 2014 2015 2016 2017 Source
Trade union membership 9,875,000 9,849,000 9,882,000 9,940,000 9,981,000 Ministry of
Health, Labour
and Welfare

Main trade union confederations and federations

Long name (English and Japanese) Abbreviation Members (2017)

Japanese Trade Union Confederation RENGO 6,729,000

(Nihon Rōdōkumiai Sōrengōkai)  

National Trade Union Council Zenrokyo 99,000

(Zenkoku Rōdōkumiai Renraku Kyōgi-kai)

National Confederation of Trade Unions Zenroren 542,000

(Zenkoku Rōdōkumiai sōrengō)
 History
After World
Colonial
War I
Rules
1 2
The Madras Labor Union was the first
impacted heavily on
labor organization formed on the lines
all the subsystem of of a modern trade union. The Textile
the social system in Labor Association (TLA) was formed
India in 1920. And the The All India Trade
Union Congress (AITUC) was also
formed in 1920 primarily to fulfill the
need for nominating employer repre-
sentatives in the delegation to the ILO.
During
World War II
3
the leader congress in the
AITUC were jailed because
of opposing the british
government and asking
Britain to quit India then
after that the comunists took
control of the organization.
 Union Type & Structure
Type: Structure:
INDUSTRIAL POLITICAL
UNION LEADERSHIP

There are two variants of industrial unionism: the

region lum industry unions (textile, plantation
workers in city or district and national industrial
While unions could stop being mere
unions (banking, transport, ports & docks, steel, adjuncts of political parties, they can-
insurance industries). A secondary type of unions not escape politics.
in India is enterprise or plant unions, though orga-
nized on the principle of industrial unionism.
What do Unions do?
Collective Bargaining in India is low
(less than 2% from total workforce)

The large size of the unorganized

sector (93 per cent of the total
workforce) and the dominance of
government employment in the
organized sector
 Present Condition
Acronym Labour Union Membership Membership Membership Political
(1989) (2002) (2013) Relationship
1 INTUC Indian National
Trade Union Co Indian National
ngress 2,706,451 3,892,011 33,300,000
Congress

2
Rashtriya
Bharatiya
BMS 3,117,324 6,215,797 17,100,000 Swayamsevak
Mazdoor Sangh
Sangh
3
All India Trade
AITUC 1,798,093 2,677,979 14,200,000 Communist Party
Union Congress of India
Challenges faced by trade union
 Small size

Poor finance

In india Politicisation

Multipicity of unions

Enlighted labour fource

Organised to
unorganised
 Change and
continuity

Competitive Market
In japanese
ness doctorine

Socio
economic
Development of trade union
 In india
Job security

Financial nd non financial aids

Removal of discrimination

Cooperation
Public opinion
 In japan

Industry nd Political
Job security
society activities

Wages formation Tax system and

pension programs

Working hours Equal employment

Security during
reccesion
 Labour Law in Japan
Labour Law in Japan: Established within this constitutional framework.
Elaborated by acts, ordinances, collective agreements and work .
Three major labour laws:
The standards law(LSL)
The Trade union law(TUL)
The Labour Relations Adjustment law(LRAL)
Acts applies to Japanese employees of the private sector, including foreign
workers possessing a visa with a work permit.
 Trade union in Japan
Definition: The organisations, which are formed
autonomously and composed mainly of workers for the
purposes of maintaining and improving working
conditions and raising the economic status of workers.
Grievance Procedure in Japan

(A) Conciliation

(B) Mediation

(C) Arbitration
 Industrial relation & Labour Law
in INDIA
As per the constitution of India, matters in Labour law contained in current list
are:
√ Entry No.22: Trade unions, industrialists and labour disputes.
✓Entry No.23: Social security and insurance, employment and
unemployment.
✓Entry No.24: Welfare of labour.
Industrial relation operates at three level:
• At national level Industrial relation operates by formulating laws, rules and liberaliza-
tion policy.
• At industry level IR takes the formal of collective bargaining between employer's or-
ganisations and unions.
• At the enterprises level IR acts as the interaction between employers and workers
or the representatives of workers.
 Numerous Acts in India on Labour Law
• Industrial dispute act ,1947,
• Factories Act, 1948
• The industrial employment (standing order) act, 1946
Defines the terms and conditions of services between the employer and employees.
• Includes:
– Medical examination and aid in case of accident
– Identification of workmen and issue of Identity
– Cards
– Working time for different categories of workmen
– Record of age ,qualification and experience
– Entry, exit and liability for security checking
– shift working and weekly off attendance and late coming methods of applying for dif-
ferent kinds of leave and extension of leave
– Action for an authorised absence
 Important Act of Labour Law
• The minimum wages act, 1948
• The trade unions act, 1926
• The maternity benefit act,1961
• The payment of gratuity act of 1972
– On his superannuation
– On his resignation
– On his death or disablement due to employment injury or disease.
Grievances Handling in India
• An employee or a trade union protest against an act or policy of the
management that they consider as violating employee's rights. One
of the effective methods is to have an "open door policy".
• Could also be settled: conciliation, arbitration, adjudication.
GLOBALIZATION AND INDUSTRIAL RELATION IN INDIA
Globalization means the speedup of movements and ex-
changes (of human beings, goods, and services, capital,
technologies or cultural practices) all over the planet.
One of the effects of globalization is that it promotes and
increases interactions between different regions and
populations around the globe.
by converting the whole world as a single Larger global
market.
Competition may become a dynamic force behind the
globalization. Government rules, regulations, and poli-
cies may also inspire globalization.
In pre-globalized era, our country was following a very
restrictive strategy towards the FDI and technological
transformation. FDI would bring attendant benefits of
technological transformation, market expertise, begin-
ning of
modern management techniques, and exchange of
technology for the support of exports.
FDI means
A foreign direct investment (FDI) is an investment made by
a firm or individual in one country into business interests lo-
cated in another country generally FDI takes place when an
investor establishes foreign business operation or acquires
foreign business assets in a foreign company
Policy of India.
The Policy put into action by the
regulatory structure make available by the Foreign Trade
(Development and Regulation) Act-1992, which replaced
the Import and Export Control Act-1947.
Government labour law proposals take steps for creating
“a fertile habitat for job creation”. This means the labour
law reforms in India is a solution to the unemployment and
brain drain problems. Labour law reforms have a key role to
play in improving the ease of doing business in India. Hence,
these appropriate reforms are directly proportional
 to domestic as well as FDI, which is a major source of non-
debt financial resource for the economic development of
India. For this reason only the Government of India recently
relaxed the FDI policy norms for Non-Resident Indians
(NRIs). Under this, the non-repatriable investments made by
the Persons of Indian Origin (PIOs), Overseas Citizens of
India (OCI) and NRIs will not be treated as foreign
investments.
According to a WB report, India has one of the most
rigid labour markets in the world. Indian labour markets
have been one of the major irritants listed by domestic and
foreign investors and institutions on the issue of ease of
doing business in India. Labour law reforms are essential in
the favor and support of economic development in India.
Balancing conflicting interests of the economy and the
constitutional mandate of a democratic, socialistic and
compassionate approach remains a titanic challenge towards
protecting appropriate labour law reforms in India.
TRADE UNION AND GLOBALIZATION IN JAPAN
New Employment Strategies As the economic recession persists
in Japan, numerous corporations began to employ part-time or
temporary employees because of the need to reduce labor costs
and the need to reduce employment without difficulty. Major
surveys confirm that Japanese companies will increase their use
of contingent employees in the future. Another way to cut costs
was increased use of outsourcing
The position taken by Rengo affected other key industrial unions
such as the Japanese Service People Union and the Japanese
Electrical, Electronic and Information Union. These industrial
unions decided to accept merit pay at their conventions in 1998.
This is a complete reversal of traditional stance taken by trade
unions, which was to pursue seniority and competency-based
pay. Key labor leaders in Japan agreed with management that
result-based pay is critical to maintain competitiveness in the
global market and that it is a way for both labor and
management to win. Instead, trade unions in Japan asked in
return an acceptable level of minimum wage and equal
employment opportunities for women.
principles
One of the most powerful union influence was achieved
through the Spring Offensive (Shunto). Shunto was originally
concerned with wage increases and was quite successful in
achieving this objective. As trade unions increased their
membership and acceptance in the Japanese society, Shunto
evolved into a 'People's Offensive' where trade unions became
the central force with coalition with other social, economic, and
political groups demanding changes in the Japanese economy,
society, and the political structure.
Thank you