CHAPTER-1

INTRODUCTION

1.1 Company Profile

Nestlé India is a multinational company with its worldwide operations in over 70 countries .The
founder of Nestlé S. A. was Henry Nestle who from a modest beginning founded the company in
1866 at Switzerland for manufacturing milk powders for babies. At that time Switzerland faced
one of the highest infant mortality rate and the milk formula saved the lives of many infants
whose mothers were unable to breast feed successfully.

At present Nestlé is the world’s largest food company with its international headquarters at
Vevey, Switzerland. With almost 500 factories worldwide it employs more than 2 Lac people.
Nestlé is often quoted by most as “multinational of multinationals.”

Nestlé is very decentralized in its operations and most of the markets are given considerable
autonomy in its operation. It is more of a people and products oriented company rather than
systems oriented company. There are “unwritten guidelines” which are to be followed, based on
common senses and a strong set of moral principals emphasizing a lot of respect for fellow
beings.

Nestlé has always adapted to the local conditions and at the same time integrates its Swiss
heritage. It has always taken a long-term view in the countries in which it operates.
Therefore, one can see a lot of investment R&D and risk taken in new product areas. There is a
great emphasis placed on training by the company. It believes in rewarding and promoting
people from within.

Today its product brand name ‘Nestlé’ is associated with ‘quality products’ in worldwide
consumer markets.

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1.1.1 Product Range of Nestle

Its activities include manufacturing and marketing of: -

 Powdered milk
 Ice creams
 Other dairy products
 Infant foods
 Chocolates & Confectionery items
 Tea
 Coffee
 Frozen products
 Fruit juices

1.1.2 Moga Factory

Moga factory started production in 1962.Today; Moga contributes almost 75% of Nestlé India’s
total production volume, manufacturing 80,000 tons of food products. It employs over 1600
people. The entire range of milks culinary products, cereals and vending mixes is manufactured
in Moga. Moga is located in the state of Punjab about 400Kms. North of New Delhi.

Salient Feature of Moga Factory

Nestlé India Ltd. Moga factory is their oldest factory in India. With a layout spread over an area
of 60 acres & having three plants within the factory, and it is also the largest factory among 500
Nestlé Factories worldwide.
The Company started milk collection in Moga area on 15 th Nov. 1961 and on the first day 510
kgs of milk was collected as from four villages and 180 farmers. From that day onwards
company is collecting milk in the morning and night. The capacity has been raised from 40,000
liters. of milk per day in 1962 to over 1200,000 liters of milk till date.

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Safety
Safety is very important part of any organization in this present era. So Nestle also takes care of
this very aspect to save its employees as well as to maintain the safety level in company
premises. Safety Officer gives training related to safety precautions to the employees and also to
the Trainees. Keeping in view the nature of the job and activities performed, safety of employees
assumes a critical role observance of safety rules and practices is the responsibility of all Nestlé
employees. An unsafe act of one employee endangers other, as well as himself. Therefore, certain
safety rules have been developed for all the plants. Every newcomer is required to acquaint
himself with these norms. For certain operations, as per the safety norms, the employees are
required to use appropriate “Protective Equipment”. E.g. Safety shoes, Gloves, Goggles, Safety
Belts, Face Shields, Aprons etc. each employee must use this protective equipments for his own
safety and for safety of other around. As entry is restricted in certain dangerous and hazardous
areas, the employee must acquaint himself with all such places.

Products
The factory consists of production plants as under:
1. Milk Operations
2. Powder Felling & Packing
3. Cereals
4. Instant Drinks
5. Culinary

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These plants are briefly described in the following fashion:

1. MILK OPERATIONS
This plant as the name suggests is engaged in the processing of milk and all the related activities
that take place in Moga Factory. This plant can be categorized into a number of sub- plants,
which are discussed below in brief:

Fresh Milk Reception

The fresh milk, which is the fundamental constituent of various products, which are
manufactured in this factory, is received in this area in tankers. There are 1100 agencies, which
supply fresh milk. The fresh milk is supplied by various chilling centers including Nestlé’s four
own milk-chilling centers. Testing of fresh milk is done in fresh milk lab and is tested for fat and
SNF only .The suppliers are paid only for fat %. In buffalo and cow milk fat varies from 4.5%-
5.5% and up to 4% respectively. While a no. Of tests are performed on tanker milk. If any one of
the tests is found to be positive then the tanker is rejected .The received milk is received in silos
after passing through PHEs. The pasteurized milk is stored in six namely A, B, C, D, E and F.
The pasteurized is 15,000 polypacks per day. The fat and SNF in it is 4.6% and 8.6%. The milk
stored in silos is used in the production of various products in Ghee Plant and Liquid Plant.

Ghee Plant
The Milk stored silos D and E is used for manufacture of Ghee, which is marked under the brand
name EVERYDAY. In this plant milk is passed through two separators. A phase inversion from
40-45% cream in the 70-80% fat in the second is obtained .The final concentration become 97%
crude fat.

DE- Odourisation Plant:

If impurities like DDT, HCH etc. are found to be present in the normal Ghee beyond a certain
limit (limit for pesticide ratio is 3.5 PPM), then these are removed in D.O. plant using thermic
fluid can be headed up to 250 C and due to it normal Ghee is heated up to 210 C and then
superheated steam is passed. At this temperature, the impurities like DDT.HCH. get vaporized
due to their volatile nature. The de-odorized Ghee is then sent to the liquid plant. LIQUID

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PLANT this plant is engaged in the processing of milk in the liquid from, prior to the drying
operations done in the Egrons, that converts it into milk power. However various products such
as, SCM & Desert Mixes are produced in the plant, besides the base liquid for drying in Egrons.

Liquid Plant
The general process-taking place in the plant can be summarized as follows:
The fresh milk received from the silos is first standardized that is the ingredients are added on
the basis of the report send by FM lab and the product they are going to manufacture. This is
needed, as there are always variations in the conditions at each different batch of milk. After this
the milk is boiled with steam under vacuum in evaporators in order to manufacture SCM. No
other industry has been able to make this product in all over India. A part of the milk is sent to
Egrons in order to get the milk power. This milk power is then blended with certain ingredients
in order to manufacture the recently launched products namely dessert mixes. The Ghee filling is
also done in these plant HDPE drums.

Egrons
Egron is a spray drier used to dry the milk, coffee liquid into power from by using hot air, In all
there are four egrons in Moga Factory Egron 2,3,4, are used for drying milk powders. The milk
is then collected in tote bins and subsequent sent to power filling and packing.

POWDER FILLING PLANT

The filling and the packing of milk like Everyday, Lactogens, Nestogen and Cerelac Tin is done
in this plant. There are five filling and packing lines for this purpose. Two of these are used in
filling of tins & the other two are used for filling polypacks or bag-n-boxes required by the
production program and one line is for bulk packing.

CEREALS
This plant is engaged in the production of cereal-based baby foods and infant formula. The
production process consists of the addition of various Enzymes, Vitamins, Minerals & Fruit
extracts to the cereal base. There are three filling and packing lines in the Cereal plant. One is for
filling of 400 gm sachets and other for filling of 400gm tins. 5gm Every Day creamer filling line

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machinery is also installed in the filling section. Though the manufacturing of products is a
continuous three-shift operation, only the Flexi runs for three shifts. It accounts for the filling of
the 65% of the manufacture products. The major product of the cereal plant is Cerelac Wheat,
Apple, Orange and Vegetable.

INSTANT DRINKS

This plant is engaged in the filling of vending pre - mixes.

CULINARY:
This plant is engaged in the production of Noodles, Tastemakers, Soups, Sauces & the like. The
plant is divided into three sections
a) NOODLES
b) SEASONING
c) COLD SAUCES
The Operation of the seasoning is inter- related with both the noodle and cold sauce section as
the spice mix base for both is manufactured in the seasoning section. However all three have a
cast column of jobs taking place & can be briefly discussed as follows:
a) Noodles
The noodle line consists of the following processes:
1 Tipping of wheat flour in the hoppers at the start of the line.
2 Mixing of dough releasing on the line.
3 Sheet formation with the help of rollers
4 Strand formation
5 Steaming
6 Frying in oil
7 Cooling
8 Wrapping cakes in sachets along with tastemaker.

b) Seasoning
The seasoning section is engaged it the manufacture of Taste marker soups cubes beside spice
mixes for use in cold sauces. The major job in this area is the dry of various spices & powders
and then packing them in the desired shape and from.

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Also the section is engaged in the manufacture of hydrolyzed plant proteins a basic ingredient for
most of the seasoning products.

The Products of this section are Maggi taste markers: Masala Chicken, Sweet & Sour, Maggi
soups (Chicken, Tomato, Mushroom & Vegetable), Maggi Cubes, Maggi Super Seasoning,
Mango Wonder-Mix, Maggi Export Mixes.

c) Cold Sauces
This section is engaged in the manufacturing of a whole range of Sauce under the brand name of
“Maggi”.
The basic manufacturing process is same for all. The line can be briefly described as:
1 Batch Preparation
2 Mixing the batch
3 Pasteurization
At this stage the sauce is ready to be filled in the bottles. However the filling line starts before
the actual filling takes place. There are three important processes prior to the bottle filling. These
are:
1 Feeding empty bottles on the line
2 Bottle Washing
3 Bottle inspection
From this the filling line actually starts. The rest of the line is:
1 Filling
2 Corking
3 Cooling
4 Capping
5 Labeling
6 Packing into cases
7 Shrink wrapping of cases

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Line Speed:
1 135 cases/hr: 1.2kg bottle
2 187 cases/hr: 600gm bottle The products of this line are Maggi Sauce (Tomato
Ketchup, Hot-N-Sweet, Masala Chili, Chili Garlic & Tomato Sauce) & Maggi
Pointed Special (Butter Chicken Karahi Paneer & Italian Pizza Popping)
3 Besides the production plants the major department in this factory.
1.1.3 Contribution of Nestle Towards Economy & Social Development Area
“In the Malwa region of Punjab State, there is a small town, which is popularly known
among the famous grain markets of the world.” In 1959 Nestlé took a decision to establish a milk
processing factory, very little could the people of Moga town and the farmers in the surrounding
villages realized that the company now, Nestlé India Ltd.., would play such an important role in
economic & social development of the area.

The company is not only an industrial and a commercial house but has make sustained
efforts to improve economic and social environment of the people in the area of it’s operation –
be it’s farmers or residents of Moga. In the initial stages company faced many problems
including procurements of milk sales of which was considered a sin at that time. But the team
that surveyed that area found the area quite suitable for development of milk and it has been
proved to be a right decision. The company started it’s operation in 1962 with a capacity of
40,000 Kg of milk per day kept on expanding on regular intervals and at present handing
capacity of 850,000 kg of milk per day. Many more products are being developed; Nestlé India
Ltd. Has also put up a coffee plant at Nanjangud and entered into joint venture to establish Soya
plant in Samalkha breakfast cereals in U.P. & also entered into tea business.

Company started milk collection in Moga area on 15 Nov 1961 and on the first day 510
kg of milk was collected from four villages. From that day onwards company is collecting milk
continuously both in the morning and in the evening without a break. The total procurement in
1962 was 2,054 million kg from 4,660 milk suppliers of 66 villages and in 1962 fresh milk
reception is 102,33 Million kg from 46,308 farmers delivering milk at 650 collection centers in
574 villages and 10 milk chilling centers. In 2001 the milk collection centers have increased to
1050 in 986 villages.

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Milk Collection System

Company has opened the milk centers in all the villages falling within it’s milk district which
cover an area of 7369 Sq.Kms. Presently there are 1050 milk collection centers and more than
500 Paco coolers where farmers can deliver milk both in the morning and evening. Milk is
collected round the year without any off day. Farmers have never faced any problem in disposing
their milk as the company lifts whatever is produced. The collection center has the facilities to
test fresh milk and preserve samples. Fresh milk samples are tested in the presence of farmers
and preserved milk samples are tested in the center lab of the factory .The is more satisfying for
the farmers as the fat testing is under double check.

Milk Collection & Pricing Policy

Milk payment is based on the fat content and is disbursed to the farmers fortnightly. Milk
payments have been computerized and are directly made to the farmers in the villages. Each
farmer gets a small slip with the milk payment which carries complete detail of milk supplied by
the former in the fortnight E.G quantity of milk, fat percentage, gross amount deduction for
services availed and net amount this helps the farmer in record keeping and also to check errors
in the payment if any.

Extension education

Company has undertaken a massive education program for the farmers. Every year seminars are
organized in collaboration with Punjab Agriculture University (PAU) Ludhiana.

This face-to-face discussion between farmers and experts of PAU proves very effective
in disseminating new farmer techniques among farming community. 20 field days are organized
every year and 300- 400 farmers from 6-8 village participate where experts of the company talk
to them on topics of current interests as profitability in dairy farming, fodder production, animal
health, breeding, clean milk production etc. Similarly camps in village are organized for farmer
education. Educative material is distributed in shapes of posters/ pamphlets. Quarterly Advisory
Newsletter is published and sent to villages. “Changi Kheti” – a PAU publication is also made

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available to the farmers free of cost to help them know latest innovations in the field of
Dairy/Agriculture farming .The payment envelopes which goes to the houses of the farmers
every fortnight is used as Newsletter on which instructions are printed on both side for the
farmers as per the requirement of the season. The extension education program has been
designed to improve productivity per unit area/meal to reduce milk production cost.

Community Service:

The company is also doing a lot of community service. In Sept. 1988, when floods
caused havoc in Punjab, the company, its employees & its associates did commendable job.
Langar camps (free food) were organized at three most effected in regions. Langar continued for
fifteen days whereas about 2000 people were fed daily. 1500 quintals green and dry fodder
supplied to the farmers. About 600 animals were vaccinated and medicines and veterinary
services were provided to 2000 affected animals.

Nestlé is not only interested in increasing milk production in it’s own milk shed area
rather company’s intention is to increase production in whole of Punjab state With this point of
view, company contributes Rs.500000 for organizing the state level cattle show held at Faridkot,
so the farmers of area beyond Nestlé’s Milk district also got encouragement for increasing milk
production and improving livestock quality. This encouraged the dairy farmers to rear good
quality milk and to participate with full zeal in future cattle shows.

Company has also programmed to highly qualified scientists for providing specialized services to
farmers not only in dairy husbandry and fodder production but also in other crops grown in the
area. The aim is to work for all-round prosperity of rural population to improve the economic and
social environment of the area.

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1.1.3 Human Resources & Nestle

HR Vision
“TO ENABLE OUR PEOPLE TO BE A FAMILY OF COMMITTED WORLD CLASS
PROFESSIONALS MAKING NESTLE A LEARNING ORGANIZATION”

HR Goals
3 To develop an organization having knowledge based competitive edge.
4 To create culture of team building, empowerment and accountability to convert knowledge
into productive action with speed, creativity and flexibility.

HR Statergies
1 Institutionalize core values for actualizing throughout the organization.
2 Imbibe a culture of openness, competence, commitment, system orientation, economy,
productivity, knowledge management, communication and training.
3 Undertake organizational renewal, restricting, periodic assessment to have a re look at
various initiatives and their impact.
4 Create motivational enabling climate of empowerment, participation, career growth,
sensitive line manager and equip them to their own HR initiative and succession
planning.
5 Communication within and outside company.

Nestle believes in achieving organizational excellence through continuous development of its

human resources. Therefore, a comprehensive human resource strategy spanning activities
preceding the pre-employment of personnel to the activities following their separation in place.
Nestle has created 18 project training centers. While the project training centers have specialized
in imparting technical skills and knowledge A systematic training plan in place, compromising
level wise planned intervention designed to groom people for assuming positions of higher
responsibility and specific need interventions designed after Scientific Training Need Analysis
Nestle has been making concerted effort to build structures and processes that enable
dissemination of knowledge and putting that knowledge in practical use. One such initiative in

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teams of executive competes annually through oral and written presentation of theme chosen by
the CMD.

Another development initiative is the mentoring system, which Nestle has introduced
for the new recruits. Under this system executive trainee is associated with the senior employee
of the company to enable him to build their knowledge base and integrate them into Nestle
culture.

A management journal called ‘Horizon’ is published to enable the employee to share

their ideas and experiences throughout the organization. As part of enhancing knowledge at
senior level, senior executives of the company are put through management development
programmes in reputed institute like Administrative staff college of India, the management
development institute.

In order to systematically and scientifically diagnose the current and potential

knowledge recruitment of the employees with the objective of aiding their development in a
planned and scientific manner, Nestle is institutionalizing development centers in the
company.Through these centers, employee can learn their strength and weaknesses and gain an
understanding of gaps in their competencies.

Organizational learning needs to be on a continuous basis. Nestle therefore, has

professional learning and quality circle, which provide employee learning opportunity on a
continuous basis. Professional circle has been formed department wise where employees of the
department meet every fortnight to share their knowledge and experiences and discuss topical
issues.In order to tap the talent among workmen and make use of their potential for creativity
and innovation, Quality circle was setup in the entire department for the power plant. As of now
over 250 quality circles are in operation in various units/offices of Nestle.Nestle has been laying
emphasis on culture-enabling processes. For instance, with the objective of leveraging the
emotional intelligence of the employees and for creating a positive and progressive
organizational culture, attitudinal training was initiated. About 2000 executive have been put
through attitudinal training programs.

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1.1.4 Growth Profile

Nestlé has been associated with the country since the beginning of the country -importing and
trading in condensed milk and infant food, manufactured in India began in 1962.

In its quest to be in every way the leading company in the Indian Food Industry, Nestlé has
been improving turnover every year. Rapid new product launches is a key propeller for growth
and Nestlé India has significantly expanded its products portfolio in recent years launching more
new products in the last five years than in the previous thirty years.

Nestle Today

Today with operation in all of five continents around 81 countries Nestlé employs some 231,881
people and has annual turnover around of newly about 80 billion Swiss Franks. It relies on 523
factories where perishable raw material such as milk, coffee, vegetables, cereals, meat, mineral
water etc. are processed & transferred in form of suitable quality food products.

1.1.6 Corporate Objectives

2 Is in every way the leading company in the Indian Food Industry?

3 Ensure high quality standards in everything the company undertake.
4 Provide our consumers with superior quality products.
5 Provide our shareholders with rapid growth and a fair return.
6 Provide our employees a challenging and satisfying work environment.
7 Be a good corporate citizen and contribute positively to the society in which we operate.

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1.1.7 Key Focus Areas Growth & Profits

1 CONSUMERS

 Work towards a situation of total consumer satisfaction.

 Ensure speedy and flexibility at all times in meeting the needs of our customers.

2 COMMUNITY

 Ensure that all aspects of the company’s operations in line with requirements and social
issues.

3 EMPLOYEES

 Involves all employees in issues to their work.

 Instil in them a sense of result orientation, and pride is there own achievements.
 Treat all employees fairly, make sure each individual knows what is expected of him,
encourage each employee to work towards continuous improvement, provide
opportunities for individual developments.

1.1.8 Other Department At Moga Factory

 Production
 Human Resources/Personnel Department
 Industrial Performance
 Engineering
 Accounts & Administration
 Quality Assurance
 Agricultural Services
 Application Group
 Manufacturing Services
 Security

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Personal Department:-In Nestle MOGA the Functions of Human Resource Department are as
follows:-
1. Establishment
2. Personnel Records
3. Policies, Salary, Survey Structure
4. Other Establishment Matters

DISCIPLINE and LEGAL

1) TIME OFFICE and PAYROLL
2) GENERAL ADMINISTRATIVE and TRANSPORT
3) TRAINING and DEVELOPMENT

In Nestle India Moga, Human Resource Department also looks about the welfare
activities of the employees. Under this come the various employee welfare activities such as:
 Staff Sales
 Recreation Club
 Canteen
 Laundry
 Trainee’s Hostel
 Medical Facilities
 Sports Activity
 Infant feeding scheme
 Recruitment & Induction

Industrial Engineering Department

The IE department in Moga factory was set up in 1971.The various responsibilities and activities
that come under the work profile of I.E. department are:
1 Production performance Assessment
2 Setting of machine and Labour Standards
3 Manpower control

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Utility Service Department
Under this come the departments of.
1 Refrigeration and Air-conditioning
2 Effluent Treatment Plant
3 Boiler House
1. Refrigeration & Air Conditioning:
This department looks after the Chilled Water Plants which supply the chilled water to
factory and the AHU’s of factory, Air Conditioners of factory and the Air Compressor of the
factory.
2. Effluent Treatemnt Plant:
This department looks after the waste water treatment before draining out of plant.
3. Boiler House:
Boiler House provides the Steam to whole factory. And it also looks after Water generation,
de-alkanization of water to feed to boiler, Soft Water generation, Power Generators and Air
Heaters.

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1.2 .1 INDUSTRIAL RELATIONS

Industrial relation refers to the relationship between management and employees or

among employees and their organization that arise out of employment. Industrial relations
involves two parties-employees and employees, without whom these relations cann’t exist. The
main purpose of industrial relation is maintaining harmonious relation between management and
labour.

Industrial relations is used to denote the collective relationships between

management and the workers. Traditionally, the term industrial relations is used to cover such
aspects of industrial life as trade unionism, collective bargaining, workers’ participation in
management, discipline and grievance handling, industrial disputes and interpretation of labor
laws and rules and code of conduct.

In the words of Lester, "Industrial relations involve attempts at arriving at solutions

between the conflicting objectives and values; between the profit motive and social gain;
between discipline and freedom, between authority and industrial democracy; between
bargaining and co-operation; and between conflicting interests of the individual, the group and
the community”.

The National Commission on Labor (NCL) also emphasize on the same concept.
According to NCL, industrial relations affect not merely the interests of the two participants-
labor and management, but also the economic and social goals to which the State addresses
itself. To regulate these relations in socially desirable channels is a function, which the State is in
the best position to perform. In fact, industrial relation encompasses all such factors that
influence behavior of people at work. A few such important factors are below:

Institution: It includes government, employers, trade unions, union federations or associations,

government bodies, labor courts, tribunals and other organizations which have direct or indirect
impact on the industrial relations systems.

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Characters: It aims to study the role of workers unions and employers’ federations officials,
shop stewards, industrial relations officers/ manager, mediator/conciliators / arbitrator, judges of
labor court, tribunal etc.

Methods: Methods focus on collective bargaining, workers’ participation in the industrial

relations schemes, discipline procedure, grievance redressal machinery, dispute settlements
machinery working of closed shops, union reorganization, organizations of protests through
methods like revisions of existing rules, regulations, policies, procedures, hearing of labor courts,
tribunals etc.

Contents: It includes matter pertaining to employment conditions like pay, hours of works, leave
with wages, health, and safety disciplinary actions, lay-off, dismissals retirements etc., laws
relating to such activities, regulations governing labor welfare, social security, industrial
relations, issues concerning with workers’ participation in management, collective bargaining,
etc.

Introduction to Industrial Relations: Industrial relations has become one of the most delicate
and complex problems of modern industrial society. Industrial progress is impossible without
cooperation of labors and harmonious relationships. Therefore, it is in the interest of all to create
and maintain good relations between employees (labor) and employers (management).

Concept of Industrial Relations: The term ‘Industrial Relations’ comprises of two terms:
‘Industry’ and ‘Relations’. “Industry” refers to “any productive activity in which an individual
(or a group of individuals) is (are) engaged”. By “relations” we mean “the relationships that exist
within the industry between the employer and his workmen.”

The term industrial relations explains the relationship between employees and
management which stem directly or indirectly from union-employer relationship. Industrial
relations are the relationships between employees and employers within the organizational
settings. The field of industrial relations looks at the relationship between management and
workers, particularly groups of workers represented by a union. Industrial relations are basically

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the interactions between employers, employees and the government, and the institutions and
associations through which such interactions are mediated.

The term industrial relations has a broad as well as a narrow outlook. Originally,
industrial relations was broadly defined to include the relationships and interactions between
employers and employees. From this perspective, industrial relations covers all aspects of the
employment relationship, including human resource management, employee relations, and
union-management (or labor) relations. Now its meaning has become more specific and
restricted. Accordingly, industrial relations pertains to the study and practice of collective
bargaining, trade unionism, and labor-management relations, while human resource management
is a separate, largely distinct field that deals with nonunion employment relationships and the
personnel practices and policies of employers.

The relationships which arise at and out of the workplace generally include the
relationships between individual workers, the relationships between workers and their employer,
the relationships between employers, the relationships employers and workers have with the
organizations formed to promote their respective interests, and the relations between those
organizations, at all levels. industrial relations also includes the processes through which these
relationships are expressed (such as, collective bargaining, workers’ participation in decision-
making, and grievance and dispute settlement), and the management of conflict between
employers, workers and trade unions, when it arises.

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Glossary Of Industrial Relations: Related Terms

For better understanding of industrial relations, various terms need to be defined here:
Industry:
Industrial Disputes Act 1947 defines an industry as any systematic activity carried on by co-
operation between an employer and his workmen for the production, supply or distribution of
goods or services with a view to satisfy human wants or wishes whether or not any capital has
been invested for the purpose of carrying on such activity; or such activity is carried on with a
motive to make any gain or profit. Thus, an industry is a whole gamut of activities that are
carried on by an employer with the help of his employees and labors for production and
distribution of goods to earn profits.

Employer
An employer can be defined from different perspectives as:-

 A person or business that pays a wage or fixed payment to other person(s) in exchange for
the services of such persons.
 A person who directly engages a worker/employee in employment.
 Any person who employs, whether directly or through another person or agency, one or more
employees in any scheduled employment in respect of which minimum rates of wages have
been fixed.

As per Industrial Disputes Act 1947 an employer means:-

In relation to an industry carried on by or under the authority of any department of [the Central
Government or a State Government], the authority prescribed in this behalf, or where no
authority is prescribed, the head of the department;

In relation to an industry carried on by or on behalf of a local authority, the chief executive

officer of that authority.

Employee: -

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  Employee is a person who is hired by another person or business for a wage or fixed
payment in exchange for personal services and who does not provide the services as part
of an independent business.
 An employee is any individual employed by an employer.
 A person who works for a public or private employer and receives remuneration in wages
or salary by his employer while working on a commission basis, piece-rates or time rate.
 Employee, as per Employee State Insurance Act 1948, is any person employed for wages
in or in connection with work of a factory or establishment to which the act applies.

In order to qualify to be an employee, under ESI Act, a person should belong to any of the
categories:

o Those who are directly employed for wages by the principal employer within the
premises or outside in connection with work of the factory or establishment.
o Those employed for wages by or through an immediate employer in the premises of the
factory or establishment in connection with the work thereof
o Those employed for wages by or through an immediate employer in connection with the
factory or establishment outside the premises of such factory or establishment under the
supervision and control of the principal employer or his agent.
o Employees whose services are temporarily lent or let on hire to the principal employer by
an immediate employer under a contract of service (employees of security contractors,
labor contractors, house keeping contractors etc. come under this category).

Employment: The state of being employed or having a job.

Industrial Relation System

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An industrial relations system consists of the whole gamut of relationships between employees
and employees and employers which are managed by the means of conflict and cooperation. A
sound industrial relations system is one in which relationships between management and
employees (and their representatives) on the one hand, and between them and the State on the
other, are more harmonious and cooperative than conflictual and creates an environment
conducive to economic efficiency and the motivation, productivity and development of the
employee and generates employee loyalty and mutual trust.

Actors in the IR system:

Three main parties are directly involved in industrial relations:

Employers: Employers possess certain rights vis-à-vis labors. They have the right to hire and
fire them. Management can also affect workers’ interests by exercising their right to relocate,
close or merge the factory or to introduce technological changes.

Employees: Workers seek to improve the terms and conditions of their employment. They
exchange views with management and voice their grievances. They also want to share decision
making powers of management. Workers generally unite to form unions against the management
and get support from these unions.

Government: The central and state government influences and regulates industrial relations
through laws, rules, agreements, awards of court ad the like. It also includes third parties and
labor and tribunal courts.

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23
1.2.3 IMPORTANCE OF INDUSTRIAL RELATIONS

The healthy industrial relations are key to the progress and success. Their significance may be
discussed as under –

Uninterrupted production – The most important benefit of industrial relations is that this
ensures continuity of production. This means, continuous employment for all from manager
to workers. The resources are fully utilized, resulting in the maximum possible production.
There is uninterrupted flow of income for all. Smooth running of an industry is of vital
importance for several other industries; to other industries if the products are intermediaries
or inputs; to exporters if these are export goods; to consumers and workers, if these are goods
of mass consumption.

Reduction in Industrial Disputes – Good industrial relations reduce the industrial disputes.
Disputes are reflections of the failure of basic human urges or motivations to secure adequate
satisfaction or expression which are fully cured by good industrial relations. Strikes,
lockouts, go-slow tactics, gherao and grievances are some of the reflections of industrial
unrest which do not spring up in an atmosphere of industrial peace. It helps promoting co-
operation and increasing production.

High morale – Good industrial relations improve the morale of the employees. Employees work
with great zeal with the feeling in mind that the interest of employer and employees is one
and the same, i.e. to increase production. Every worker feels that he is a co-owner of the
gains of industry. The employer in his turn must realize that the gains of industry are not for
him along but they should be shared equally and generously with his workers. In other
words, complete unity of thought and action is the main achievement of industrial peace. It
increases the place of workers in the society and their ego is satisfied. It naturally affects
production because mighty co-operative efforts alone can produce great results.

Mental Revolution – The main object of industrial relation is a complete mental revolution of
workers and employees. The industrial peace lies ultimately in a transformed outlook on the
part of both. It is the business of leadership in the ranks of workers, employees and

24
 Government to work out a new relationship in consonance with a spirit of true democracy.
Both should think themselves as partners of the industry and the role of workers in such a
partnership should be recognized. On the other hand, workers must recognize employer’s
authority. It will naturally have impact on production because they recognize the interest of
each other.

Reduced Wastage – Good industrial relations are maintained on the basis of cooperation and
recognition of each other. It will help increase production. Wastages of man, material and
machines are reduced to the minimum and thus national interest is protected.

Thus, it is evident that good industrial relations is the basis of higher

production with minimum cost and higher profits. It also results in increased efficiency of
workers. New and new projects may be introduced for the welfare of the workers and to promote
the morale of the people at work. An economy organized for planned production and distribution,
aiming at the realization of social justice and welfare of the massage can function effectively
only in an atmosphere of industrial peace. If the twin objectives of rapid national development
and increased social justice are to be achieved, there must be harmonious relationship between
management and labor.

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1.2.4 OBJECTIVES OF INDUSTRIAL RELATIONS

The main objectives of industrial relations system are:-

1. To safeguard the interest of labor and management by securing the highest level of mutual
understanding and good-will among all those sections in the industry which participate in
the process of production.
2. To avoid industrial conflict or strife and develop harmonious relations, which are an
essential factor in the productivity of workers and the industrial progress of a country.
3. To raise productivity to a higher level in an era of full employment by lessening the
tendency to high turnover and frequency absenteeism.
4. To establish and promote the growth of an industrial democracy based on labor partnership
in the sharing of profits and of managerial decisions, so that ban individuals personality
may grow its full stature for the benefit of the industry and of the country as well.
5. To eliminate or minimize the number of strikes, lockouts and gheraos by providing
reasonable wages, improved living and working conditions, said fringe benefits.
6. To improve the economic conditions of workers in the existing state of industrial
managements and political government.

Socialization of industries by making the state itself a major employer.

Vesting of a proprietary interest of the workers in the industries in which

They are employed.

1.2.5 ROLE OF STATE IN INDIAN INDUSTRIAL RELATIONS

26
India is socialist democratic republic state. Every elected government of the country has as its
bounden duty to secure upliftment of all citizen and to that extent the constitution provides for
rules and regulations through a system of laws that would facilitate progress, redress of
grievances and thereby would maintain peace and harmony in the society!

As regards "labour" while the State is committed to promote industrial growth through bilateral
relations between employers and employees for mutually healthy existence, cooperation and
progress, the state is NOT oblivious to the fact that despite best intentions and efforts, sometimes
the issues between the parties may not get resolved at bilateral level and unless a way ro resolve
is sanctified through the constitution of the country and the system of law, there would be
impediments to progress and the expected peace and harmony may get vitiated. Against this
backdrop, it is simple to accept and apreciate that the State has reserved a a role of an "Umpire or
a Referee" in the game of industrial relations in the country. Its provides all kinds of mechanisms
to parties through law to resolve their own problems bilaterally and has further taken care to
provide a quasi judicial/judicial system for determination of disputes.

Personally and professionally, one feels that this is an ideal system. Unfortunately, the experience
shows that corrupt administration, adventurous unionism, sluggish judiciary and tight fisted
managements have made a virtual mockery of the concept. But the idea essentially is excellent in
the State becoming an Umpire and to help parties become mature in resolving problems amongst
themselves! The role of the State in Indian Industrial Relations is that of an Umpire, Elder
brother andwell-wisher! That the concerned parties have vitiated the golden thought is the
country's misfortune!!!

Employers' organization

An employers' organization, employers' association or employers' federation is an association of

employers. A trade union, which organizes employees is the opposite of an employers'
organization. The role and position of an employers' organization differs from country to country,
dependent on the economic system of a country. In countries with a pluralist or anglo-saxon
economic system (such as the United Kingdom and the United States), where there is no

27
institutionalized cooperation between employers' organizations, trade unions and government, an
employers' organization is an interest group or advocacy group that through lobbying tries to
influence government policy. In these countries, employers' organizations tend to be weak, with
many of their functions taken over by industry trade groups, which are basically public relations
organization.

In countries with a social market economy, such as Austria, Sweden and the Netherlands, the
employers' organizations are part of a system of institutionalized deliberation, together with
government and the trade unions. In tri-partite bargaining the so-called social partners strike
agreements on issues like price levels, wage increases, tax rates and pension entitlements. In
these countries collective bargaining is often done on a national level not between one
corporation and one union, but national employers' organizations and national trade unions.

INDUSTRIAL RELATIONS MACHINERY

Today we are going to study the means and ways to resolve industrial disputes. We should
understand that whenever there is some problem in our professional or personal life, we should
not get disturbed by the problem .We should look for solutions. Please remember that Go d helps
those who help themselves! At this encouraging note let us get into the technicalities of resolving
conflicts in organisations.

INDUSTRIAL RELATIONS MACHINERY

Cordial industrial relations and lasting industrial peace require that the causes of industrial
disputes should be eliminated. In other words, preventive steps should be taken so that industrial
disputes do not occur. But if preventive machinery fails then the Government should activate the
industrial Settlement machinery because non-settlement of disputes proves to be harmful not
only for the workers, but also the management and the society as a whole. The machinery for
handling the industrial disputes has been shown in the following figure:

MACHINERY FOR HANDLING INDUSTRIAL DISPUTES

Preventive Machinery

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(Voluntary or Non-statutory)

Settlement Machinery (Statutory)

This is sure that all of us would have heard the saying that prevention is better than cure.
Keeping that in mind let us discuss the prevention machinery before the settlement machinery. I
hope all of you have understood the difference between the two. If you have not, let me explain it
to you. The preventive machinery ensures that there are no disputes. It aims at creating an
environment in which the employees are allowed to participate and there are very less chances of
conflicts. It is thus proactive in nature. Now don’t tell me that you don’t understand the meaning
of pro activity…Anyhow, pro activity means that actions are taken before there is a problem. The
settlement machinery on the other hand is reactive in nature. After there is a problem or a
dispute, the settlement machinery comes into the picture.

Prevention of industrial disputes:

The preventive machinery has been set up with a view to creating harmonious relations between
labour and management so that disputes do not arise. It comprises the following measures:
a) Schemes of workers’ participation in management such as works committees, joint
management councils and shop councils and joint councils.
b) Collective bargaining.
c) Tripartite bodies
d) Code of discipline.
The schemes of workers’ participation and collective bargaining will be discussed in greater
detail as a separate topic. As of now, please read something on these schemes and we will discuss
it in the due course.
Rests of the preventive measures are discussed below:

• Tripartite Bodies
Industrial relations in India have been shaped largely by principles and policies evolved through

29
tripartite consultative machinery at industry and national levels. The aim of the consultative
machinery is “to bring the parties together for mutual settlement of differences in a spirit of
cooperation an goodwill” Thus these bodies play the role of consultants!!

Indian Labour Conference (ILC) and Standing Labour Committee (SLC) have been constituted
to suggest ways and means to prevent disputes. The representatives of the workers and
employers are nominated to these bodies by the Central Government in consultation with the All-
India organisations of workers and employers.

The Labour Ministry settles the agenda for ILC/SLC meetings after taking into consideration the
suggestions sent to it by member organisations. These two bodies work with minimum
procedural rules to facilitate free and fuller discussions among the members. Please note that the
ILC meets once a year, whereas the SLC meets as and when necessary. I am sure you would have
read in the newspapers that the ILC meet is being organized.

The functions of ILC are:

(a) To promote uniformity in labour legislation
(b) To lay down a procedure for the settlement of industrial disputes
(c) To discuss matters of All-India importance as between employers and employees. The ILC
advises the Government on any matter referred to it for advice, taking into account suggestions
made by the States and representatives of the organisations of workers and employers.

The Standing Labour Committee’s main function is to consider and determine such questions
as may be referred to it by the Plenary Conference or the Central Government and to render
advice, taking into account the suggestions made by various governments, workers and
employers.

• Code of Discipline

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The Code of Discipline is a set of self-imposed mutually agreed voluntary principles of
discipline and relations between the management and workers in the industry.In view of growing
industrial conflict, the Fifteenth Indian Labour Conference agreed that there should be a set of
general principles of discipline, which should be adopted by labour and management voluntarily.
To evolve such a set of principles, a tripartite sub-committee was set up. The resulting draft was
discussed at Standing Labour Committee meeting in October 1957. At the Sixteenth Indian
Labour Conference held in 1958, the final form of the Code of Discipline was approved. The
details of the code are discussed later.As of now please understand that there are three sets of
principles in the Code Of Discipline. The first set of principles is for the management and the
union. The second set is for the Management and the third one is for the union

Central Industrial Relations Machinery (CIRM)

The Chief Labour Commissioner’s (Central) [CLC(C)] Organisation, also known as Central
Industrial Relations Machinery, is an attached office of the Ministry. The CIRM is headed by the
Chief Labour Commissioner (Central). It has been entrusted with the task of maintaining
Industrial Relations, enforcement of Labour Laws and verification of Trade Union Membership
in central sphere. CIRM has complement of 25 officers at the Head Quarters and 253 Officers
in the field. The offices of these Officers are spread over different parts of the country with zonal,
regional and unit level formations.
Functions of the organisation:

The functions of CIRM broadly are given as under:

 Prevention and settlement of Industrial Disputes, in central sphere;

 Enforcement of Labour Laws and Rules made there under in central sphere;
 Implementation of awards.
 Quasi-Judicial functions.
 Verification of the membership of the Trade Unions.
 Welfare.
Dunlop's Contribution to Industrial Relations

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Dunlop's Model One of the significant theories of industrial labor relations was put forth by John
Dunlop in the 1950s. According to Dunlop industrial relations system consists of three agents –
management organizations, workers and formal/informal ways they are organized and
government agencies. These actors and their organizations are located within an environment –
defined in terms of technology, labor and product markets, and the distribution of power in wider
society as it impacts upon individuals and workplace. Within this environment, actors interact
with each other, negotiate and use economic/political power in process of determining rules that
constitute the output of the industrial relations system. He proposed that three parties -
employers, labor unions, and government-- are the key actors in a modern industrial relations
system. He also argued that none of these institutions could act in an autonomous or independent
fashion. Instead they were shaped, at least to some extent, by their market, technological and
political contexts.

Thus it can be said that industrial relations is a social sub system subject to three
environmental constraints- the markets, distribution of power in society and technology.

Dunlop's model identifies three key factors to be considered in conducting an analysis of the
management-labor relationship:

1. Environmental or external economic, technological, political, legal and social forces that
impact employment relationships.
2. Characteristics and interaction of the key actors in the employment relationship: labor,
management, and government.
3. Rules that are derived from these interactions that govern the employment relationship.

Dunlop emphasizes the core idea of systems by saying that the arrangements in the field of
industrial relations may be regarded as a system in the sense that each of them more or less
intimately affects each of the others so that they constitute a group of arrangements for dealing
with certain matters and are collectively responsible for certain results”. In effect - Industrial
relations is the system which produces the rules of the workplace. Such rules are the product of
interaction between three key “actors” – workers/unions, employers and associated organizations
and government The Dunlop’s model gives great significance to external or environmental
forces. In other words, management, labor, and the government possess a shared ideology that

32
defines their roles within the relationship and provides stability to the system.

1.2.6 INDUSTRIAL RELATION POLICY

Prior to 1991, the industrial relations system in India sought to control conflicts and disputes
through excessive labor legislations. These labor laws were protective in nature and covered a
wide range of aspects of workplace industrial relations like laws on health and safety of labors,
layoffs and retrenchment policies, industrial disputes and the like. The basic purpose of these
laws was to protect labors. However, these protectionist policies created an atmosphere that led
to increased inefficiency in firms, over employment and inability to introduce efficacy. With the
coming of globalization, the 40 year old policy of protectionism proved inadequate for Indian
industry to remain competitive as the lack of flexibility posed a serious threat to manufacturers
because they had to compete in the international market.

With the advent of liberalization in1992, the industrial relations policy began to change. Now,
the policy was tilted towards employers. Employers opted for workforce reduction, introduced
policies of voluntary retirement schemes and flexibility in workplace also increased. Thus,
globalization brought major changes in industrial relations policy in India. The changes can be
summarized as follows:

 Collective bargaining in India has mostly been decentralized, but now in sectors where it
was not so, are also facing pressures to follow decentralization.

 Some industries are cutting employment to a significant extent to cope with the domestic
and foreign competition e.g. pharmaceuticals. On the other hand, in other industries
where the demand for employment is increasing are experiencing employment growths.

 In the expansionary economy there is a clear shortage of managers and skilled labor.

 The number of local and enterprise level unions has increased and there is a significant
reduction in the influence of the unions.

 Under pressure some unions and federations are putting up a united front e.g. banking.

33
  Another trend is that the employers have started to push for internal unions i.e. no outside
affiliation.

 HR policies and forms of work are emerging that include, especially in multi-national
companies, multi-skills, variable compensation, job rotation etc. These new policies are
difficult to implement in place of old practices as the institutional set up still needs to be
changed.

 HRM is seen as a key component of business strategy.

 Training and skill development is also receiving attention in a number of industries,

especially banking and information technology.

Perspective of IR

 Unitary Perspective: In unitarism, the organization is perceived as an integrated and

harmonious system, viewed as one happy family. A core assumption of unitary approach
is that management and staff, and all members of the organization share the same
objectives, interests and purposes; thus working together, hand-in-hand, towards the
shared mutual goals. Furthermore, unitarism has a paternalistic approach where it
demands loyalty of all employees. Trade unions are deemed as unnecessary and conflict
is perceived as disruptive.

From employee point of view, unitary approach means that:

 Working practices should be flexible. Individuals should be business process

improvement oriented, multi-skilled and ready to tackle with efficiency whatever tasks
are required.

34
  If a union is recognized, its role is that of a further means of communication between
groups of staff and the company.
 The emphasis is on good relationships and sound terms and conditions of employment.

 Employee participation in workplace decisions is enabled. This helps in empowering

individuals in their roles and emphasizes team work, innovation, creativity, discretion in
problem-solving, quality and improvement groups etc.
 Employees should feel that the skills and expertise of managers supports their endeavors.

From employer point of view, unitary approach means that:

 Staffing policies should try to unify effort, inspire and motivate employees.
 The organization's wider objectives should be properly communicated and discussed with
staff.
 Reward systems should be so designed as to foster to secure loyalty and commitment.
 Line managers should take ownership of their team/staffing responsibilities.
 Staff-management conflicts - from the perspective of the unitary framework - are seen as
arising from lack of information, inadequate presentation of management's policies.
 The personal objectives of every individual employed in the business should be discussed
with them and integrated with the organization’s needs.

Pluralistic-Perspective: In pluralism the organization is perceived as being made up of powerful

and divergent sub-groups - management and trade unions. This approach sees conflicts of
interest and disagreements between managers and workers over the distribution of profits as
normal and inescapable. Consequently, the role of management would lean less towards
enforcing and controlling and more toward persuasion and co-ordination. Trade unions are
deemed as legitimate representatives of employees. Conflict is dealt by collective bargaining and
is viewed not necessarily as a bad thing and if managed could in fact be channeled towards
evolution and positive change. Realistic managers should accept conflict to occur. There is a
greater propensity for conflict rather than harmony. They should anticipate and resolve this by

35
securing agreed procedures for settling disputes.
The implications of this approach include:

 The firm should have industrial relations and personnel specialists who advise managers
and provide specialist services in respect of staffing and matters relating to union
consultation and negotiation.

 Independent external arbitrators should be used to assist in the resolution of disputes.

 Union recognition should be encouraged and union representatives given scope to carry
out their representative duties.

 Comprehensive collective agreements should be negotiated with unions.

Marxist Perspective: This view of industrial relations is a by product of a theory of capitalist

society and social change. Marx argued that:
Weakness and contradiction inherent in the capitalist system would result in revolution and
the ascendancy of socialism over capitalism.

Capitalism would foster monopolies.

Wages (costs to the capitalist) would be minimized to a subsistence level.

Capitalists and workers would compete/be in contention to win ground and establish their
constant win-lose struggles would be evident.

This perspective focuses on the fundamental division of interest between capital and labor, and
sees workplace relations against this background. It is concerned with the structure and nature of
society and assumes that the conflict in employment relationship is reflective of the structure of
the society. Conflict is therefore seen as inevitable and trade unions are a natural response of
workers to their exploitation by capital.

1.2.7 PARTIES TO INDUSTRIAL RELATIONS

36
There are three main parties in industrial relation:-
1. Employers And Their Organizations :-The employers are the very significant party in the
industrial relation. They have the right of hire and fire the workers. Industrial unrest arises when
the employer demands from the workers are very high & they offer low economic and other
benefits. They also participate in tripartite bodies.
2. Employees And Their Organizations:-The personal characteristics of workers, culture,
education attainment qualification, skills etc play an important role in industrial relations.
Workers get support from trade union and labour legislation. Trade union pressure on both at
plant level and industry level.
3. Government :-Government has come to play an important role in industrial to protect the
interests of both employers and employees. The governments keep an eye both on the trade
unions and employers to regulate their activities in the interest of nation.

1.2.8 APPROACHES TO INDUSTRIAL RELATIONS

Following are the approaches to industrial relations:-
1. Psychological Approach:-To a psychologist, industrial conflicts means conflicting interests,
aspirations, goals, motives and perception of different group of individual operation with in and
reacting to a given socio economic and political environment. The perception of employers,
workers and trade unions are different from one another.
2. Sociological Approach:-The social and cultural changes shape behavioral patterns and cause
adjustment in industrial relation. Industry is a part of society and the value system, customers,
status, symbols and institutions of the society affect relation between the parties involved.
Various social problems cause stress and strain among workers which affect their industrial

37
relations.
3. V.V.Giri Approach:-Sh. V.V.Giri, late president of India, gave an approach to settle industrial
disputes. This approach to industrial relation implies the encouragement of mutual settlement of
disputes. The essence of this approach is internal settlement in preference to compulsion from
outside and voluntary arbitration and collective bargaining.
4. Gandian Approach:-In this Gandhiji accepted the workers right to go on strikes but they
should exercise this right in a peaceful and non-violent manner.
5.HRD Approach:-The HRD approach recognizes employees as the greatest assets in an
organization believes that they cann’t developed to an unlimited extent with proper incentive,
atmospheres and treatment. It is possible to integrate human needs with organization
requirement.

1.2.9 CAUSES FOR POOR INDUSTRIAL RELATIONS

Several factors are responsible for the poor industrial relations as under:-
1. Economical Factors:-Poor wages and poor working conditions are the main reason for
unhealthy relation between management and workers. When employers deny equitable and fair
remuneration and good working and living condition to the class, trade union agitate and
industrial place is distributed.
2. Organizational Factors :-Organizational causes of poor industrial relation include facility
communication system, non-recognition of trade unions, unfair practices, violation of collective
agreements etc.
3. Social Factors-Dissatisfaction with jobs and personal life results into industrial conflicts.

38
Factory system and specialization have made workers subordinates to the machine. Tension and
conflicts in society also affect good industrial relation.
4. Psychological Factors: -Lack of job security, poor organization culture, non-recognition of
merit and performance, authoritative administration and poor interpersonal relation are the
psychological reason for unsatisfactory industrial relation.
5. Political Factors: -The outsiders who become union leaders by making wild promises to
workers make excessive demands on employers. When employers don’t accept their demand
conflict arises spoiling the industrial relation climate in the country.

1.2.10 SUGGESTIONS TO IMPROVE INDUSTRIAL RELATIONS

1 Top Management Support: -Top management style needs to be proactive and geared to
problem solving. The actions and decision of management must bear the testimony of
professional approach to HRM. Providing that IR director should report to a top line authority
ensures this
2 Strong Trade Union: -Existence of strong, well organization and democratic employees
union is must for sound industrial relation. IR can be sound only when the beginning power of
employees union is equal to that of management.
3 Sound Employees Unions: -Employers unions should be also sound and well organized.
These unions are helpful for promotion and maintenance of uniform personnel policies among

39
various organizations and to protect the interest of week employers.
4 Positive Attitude:-Both management and trade unions should adopt positive attitude
towards each other. Management must recognize trade union as well as the representative of
workers and spokesman. Union and workers should recognize and accept the right of employers.
5 Collective Bargaining :-The industrial peace can be maintained only if employers and
employees settle their difference through manual negotiation and consultation rather then
through the intervention of third party. Collective bargaining is a process through which
employee issue are settled through mutual discussion and negotiation through a give and take
approach.
6 Grievances Procedure:-There should be a well establish and properly administered
grievance redressed machinery. It should provide an outlet for tension and frustration of workers.

7 Supervisory Training:-Job supervision should be trained thoroughly to ensure that

organization policies and practices are properly implemented and carried into effect. The
supervisor should also be trained in leadership and communication.
8 Follow Up:-A regular follow up of industrial relation programmer is essential, so that
existing practices may be properly evaluation and check may be exercised on certain undesirable
tendencies should they manifest themselves.

1.2.11 NEED OF THE STUDY

Industrial relation is an important factor for every organization. The need of the study is to know
about the industrial relations in an industry and how these relations affect the performance of the
employees. If in a company industrial relation is good then there must be job satisfaction among
employees, less labour turnover, high profit etc and also to give suggestions how to improve the
industrial relations to make the employees more satisfied with their jobs.

1.2.12 OBJECTIVES OF THE STUDY

Following are the objectives of the study: -
1. To study the general profile of respondent.

40
2. To measure the industrial relation in the company.
3. To suggest suitable measures to improve industrial relation.

1.2.13 PLAN OF THE STUDY

The project work comprises of five chapters. The brief introduction of each chapter
is as: -
Chapter-1 describe about the company, company’s products, objectives of company, and
contribution of company towards economy & social development area. And also relation of
company with human resource
This chapter also describe about Industrial Relations. Its objectives, parties,
approaches, causes of poor of Industrial Relations, suggestion to improve and so my need of
study and objectives of study.

Chapter-2 This chapter describe about the review of literature of Industrial relations. It
explain the contribution and abstract of different researcher about Industrial Relation in different
years.

Chapter-3 this is the chapter of Research Methodology. This chapter is about what is research,
its types, and research design, data for research, sources of data and also about preparation of
questionnaire. In Research Methodology chapter also told about the statistical tools & techniques
and limitation of the study.
Chapter-4 this chapter deals with analysis and discussions of various factors, which tell us about
the satisfaction level of the respondents, next part covers the various factors that contribute in
development of industrial relations. After that there is some suggestions, which help in
improving the industrial relations. Last part deals with the factors that enhance the industrial
relations.

Chapter-5 this is the last chapter in this I give the idea about whole study in form of summary.
After that I conclude my study according to that I give some suggestions and recommendations

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 CHAPTER -2
REVIEW OF LITERATURE

Tom Keenoy (1990)

In the past year a number of major comparative studies of industrial relations have been
published, and five of these are reviewed here. All the texts agree that global economic
integration has posed serious challenges to national industrial relations systems, but beyond this
their analyses differ sharply. The author examines in detail the themes of trade union decline and
human resource management, and considers how far these may be seen as connected elements in
a new industrial relations paradigm.

Børge Lorentzen (1991)

42
Since 1991 a research group has investigated the relationship between environmental policies and
the industrial relations systems in 10 European countries. It might be expected that the growing
importance of the environment as a policy issue would prompt an enlargement of the traditional
agenda of industrial relations systems, leading to stronger inclusion of the social partners in
environmental action; but in the main, evidence of such enlargement has been sparse. The
Netherlands, where works councils legislation has been used to extend collective rights for
greater environmental involvement, stood out as the exception. Elsewhere, initiatives have been
mostly confined to company-level voluntary agreements, with certain sectors playing a prominent
role.

Russell Warhurst (1992)

Industrial relations issues have recently become critical to the survival of airlines and the
structure of the industry in Europe. The author analyses the impact of deregulation and deep
economic recession on the traditionally stable industrial relations in European flag-carrier
airlines. Moves towards a single European aviation market might imply convergence in industrial
relations practices; the article assesses how far this has occurred, and suggests that airline
managements across Europe have tended to adopt similar new practices.

Franz Traxler (1993)

This article explains the long-term development of industrial relations from a cross-national
comparative perspective. Its main thesis is that industrial relations systems accommodate to
external changes self-referentially, in that the prevalent bargaining mode and its interaction with
procedural state regulation guide the direction of adaptation by defining the possibilities for
renewing the compromise between capital and labour under changed conditions. A combined
longitudinal and cross-sectional analysis is used to show that the dichotomies between multi- and
single-employer bargaining as the prevalent bargaining mode, and between the presence and
absence of state regulation conducive to collective bargaining, have resulted in a polarization
between countries where the compromise could be renewed within an organized framework and
those where this renewal failed. Since the renewal of the compromise has been specific to
Europe, the article concludes by discussing its prospects for durability and further adjustments.

43
Kees J. Vos (1994)
The possibility of convergence of national industrial relations systems has been debated for a
long time. However, the predominant approach is to stress the persistence of national variation.
This article draws on a number of comparative studies in order to consider whether globalization
and European policy developments are important drivers towards increasing convergence.
Consequently, the article concludes that a critical review of the prevalent research methods is
necessary.

Roy J. Adams (1995)

In North America as in Europe, the `Great Recession' of the early 1980s has had an enduring
impact on industrial relations. Despite superficial similarities, however, there have been
important differences in the extent to which industrial relations institutions in the two continents
have been able to accommodate the challenges. The author considers these differences with
respect to four themes: Japanization, supranational economic integration, and decentralization of
collective bargaining and trade union decline. He concludes by discussing the implications for
the academic study of industrial relations.

Paul Marginson (1996)

Growing European economic integration has encouraged restructuring within multinational
companies (MNCs), involving the development of organization-based employment systems,
changing forms of management control and a shift in bargaining power. These developments are
promoting the decentralization of collective bargaining and challenging established structures of
multi-employer bargaining.

Lise Lotte Hansen, Jorgen Steen Madsen (1997)

The central theme for discussion at the IREC (Industrial Relations in the European Community
network) Conference held in Copenhagen in September 1996 was `Industrial Relations in
Europe: Convergence or Diversification?'. This article - by three of the organizers - presents a
comparative assessment of three of the sub-themes treated at the conference, weighing their
significance in relation to the overall pattern of convergence and divergence in European

44
industrial relations.

Therese Beaupain (1998)

This review article concerns both comparative texts with a focus on national industrial relations
systems and works concerned with difficulties faced by unions today. The author considers that
one important aspect to be taken into consideration, both in describing the systems and in
assessing the present challenges, concerns the `founding choices’, which helped establish the
modern institutional orders. She suggests that more attention be given in comparative work to
building up knowledge in a cumulative way.

Russell Warhurst (1999)

Industrial relations issues have recently become critical to the survival of airlines and the
structure of the industry in Europe. The author analyses the impact of deregulation and deep
economic recession on the traditionally stable industrial relations in European flag-carrier
airlines. Moves towards a single European aviation market might imply convergence in industrial
relations practices; the article assesses how far this has occurred, and suggests that airline
managements across Europe have tended to adopt similar new practices.

William K. Roche (2000)

This article assesses the extent to which `new' industrial relations regimes have developed in
advanced economies over the past two decades and considers the prospects of new industrial
relations. A review of evidence on current diffusion of new industrial relations practices and
arrangements, combined with an assessment of change scenarios, suggests that new industrial
relations regimes are unlikely to become generalized in advanced economies. Instead, new
industrial relations will remain one of a series of coexisting regimes shaping relations between
employers and unions.

Matthias Bansbach (2001)

This review article presents an overview of important recent German-language publications on
the construction of industrial relations at European level. It focuses on five monographs dealing
with three different subject areas: the establishment of European Works Councils in multinational

45
companies, and the evolution of social dialogue at both interprofessional and sectoral levels.

Gill Kirton (2002)

This introduction draws together the broad themes discussed in the articles presented in this
special issue, placing cross-national similarities and differences in gender, equality, and industrial
relations within a broader conceptual and policy context. As a field of study, industrial relations
traditionally downplays the salience of gender and other identity characteristics; however, the
European policy context now firmly supports the positioning of gender and equality as key issues
within the industrial relations system.

Berndt Keller (2003)

This review article begins by discussing some of the distinctive features of industrial relations
research in the German context. It then discusses the main general and introductory texts, which
have been available in the German-speaking literature since the mid-1980s. There is a brief
discussion of contributions within both academic and practitioner-orientated journals, and a
concluding assessment of the future of German-language industrial relations studies.

Chris Smith (2004)

This article addresses the interplay between international competition and national institutional
patterns. It discusses the involvement of Japanese transnational corporations (TNCs) in the
contemporary restructuring of work organization and industrial relations in three European
countries with historically disparate `systems', Britain, Germany and France.

Luis Ortiz (2005)

The possibility of convergence of national industrial relations systems has been debated for a
long time. However, the predominant approach is to stress the persistence of national variation.
This article draws on a number of comparative studies in order to consider whether globalization
and European policy developments are important drivers towards increasing convergence.
Consequently, the article concludes that a critical review of the prevalent research methods is
necessary.

46
Mark Stuart (2007)
The learning agenda has become an increasingly prominent concern of policy-makers at the level
of the EU and national Member States, and is often presented as a positive-sum issue around
which industrial relations renewal can take place. Yet the dynamics related to this in industrial
relations terms are relatively under-explored.These show that the new politics of learning and
skill poses significant challenges for national systems of regulation.

Michael Gold, Sandra Schwimbersky (2008)

His article explores the origins and development of the European Company Statute, with
particular reference to its provisions for employee involvement, both through a `representative
body' and through board-level participation. European companies can be seen as `hybrid'
organizations in which common European-level elements are combined with supplementary
features deriving from the legislation of the country in which they are registered. The article
outlines the types of company that have opted so far to become European companies and analyses
a variety of the issues raised, including the range of options that now confront management in
setting up such a company, the position of the unions and the `Europeanization' of company
boards.

CHAPTER -3
RESEARCH METHODOLOGY

3.1 RESEARCH
Research is the systematic and objective search for the analysis of information relevant to the
identification and solution of the specific problem. Research is science and a systematic search
for pertinent information on a particular topic.
In fact research is an act of scientific investigation.

3.2 TYPES OF RESEARCH

Broadly research can be divided into two heads – experimental and non-experimental. Three
essential components of experimental research are control, manipulation and measurement.

47
 Experimental method of data collection is ideal though not always possible
because of many research problems in the social science and education do not lend themselves to
experimental enquiry. A little reflection on some of the important variable in educational research
– intelligence, aptitude, personality etc will show that they are not manipulable.

Even, if we avoid non-experimental method we cannot . Non-experimental

research posses only one component which is measurement. The researcher does not exercise
any control over the extraneous variable. He simply measures the effect on dependent variable as
they occur naturally- without manipulation. This means that this type of research cannot establish
casual relationship.
One of the common method of survey is non-experimental research is field survey
under which comes the sample survey. A sample survey is also a form of ex-post facto research
in which the researchers simply collect the data about certain psychological or sociological
characteristic of the sample that represents the known population.

The researcher is interested in knowing something about the whole population but
cannot study the whole population and he only studies the sample drawn from the populations.
The data are sought directly from the respondents by a systematic technique like a questionnaire,
which is the most popular are widely used technique of data collection.

3.3 RESEARCH DESIGN

A researcher design is the overall plan or programme of research. It is the general blue print for
the collection, measurement and analysis of data. It includes an outline what an investigator can
do from writing the hypothesis and their operational implication to the final analysis of data.
Various uses of having a research design are as follows –
1. It provides answers to various questions such as:
 What is the object of research?
 What data are needed and how will these be gathered?
 What will be the time, place and sample of study?
 How will the data be analyzed and interpreted?
2. It acts as a standard and guidepost, which helps the researcher in measuring his/her

48
 shortcoming and deviation in actual research later on.
3. It forestalls the possibility of a fruitless enquiry and act as an insurance against future
failure.

3.4 DATA
Data constitutes the foundation of any analysis. Data is the collection of any number of related
observations.Surveys are the most popular device of obtaining the desired data. A survey is a
process of collecting data from existing population units with no particular control over factors
that may affect the population characteristic of interest in study.
Data is the quantitative or numerical information, which is collected for future analysis and
interpretation in order to base decision on them.

3.5 SOURCES OF DATA

Primary Data Source:- Primary data source comprises responses to questionnaire and
interviews conducted with manager, supervisor of all department of the company.
Secondary Data Source:- Secondary data source is the one that makes available data that are
collected by some other agency earlier. It comprises different books on the human resource.
3.6 PREPRATION OF QUESTIONNAIRE
Much labor and care was taken in designing the questionnaire to maintain the brevity and
accuracy. The rule is to gather the data you need but not more than is needed, therefore the
number of questions was only ten. The questions were such that which evoked accurate and
desired responses – which contained the information sought.

The questionnaire was in a structured format in which the questions are asked
from the respondents were very precise and concisely stated in advance, thus maximizing
standardization. In order to design a good questionnaire all relevant books on the subject were
consulted. All the available articles and research work were taken into account. Exploratory
discussion with my guide, who had intimate knowledge of the subject, helped me never lose
sight of the hypothesis to be tested. Care was taken to relate all questions intimately to the final
objective of the investigation.

49
3.7 DETERMINATION OF SAMPLE
Population:- It is defined in terms of elements, unit, extent and time. The demographic profile of
the respondents was a below:
Men or women employed in Nestle must have a knowledge about Industrial
Relations and their performance is evaluated according to that Industrial Relation only. Nature of
population was homogeneous therefore a small sample was effective to represent it.
Size: - 30 employees

Sampling Method

Non random (or probability) samples

In which the probability of unit selection is unknown at any stage of the selection process and
the selection of unit is based on the judgment of the researcher was selected.

The method used was purposive sampling. These term means selection by design – by
choice and not by chance. The sample was chosen which was thought to be typical of the
universe with regard to the characteristic under investigation.Such type of sampling was possible
because of my guide who already had the necessary required knowledge about the employees
that made it easier to recognize typical items in the universe.

50
3.8COLLECTION OF DATA

When planning was completed, the survey moved into the field and undertook the fieldwork that
is distribution and collection of facts. The total number of questionnaire distributed were 50 out
of which only 30 were taken into analysis, few were not considered due to incomplete data entry
and few questionnaires were not filled.

3.9 ANALYSIS OF DATA

Researcher must breathe life into the cold data by skillful analysis and hence need to
follow three steps – editing, classifying and analyzing the data.
The content of the data obtained in a survey were carefully checked for any possible
inconsistencies and incompleteness. Then came the careful analysis – the data are then coded and
tabulated according to the rating in the dummy table. And then finally tabulated data is
interpreted with the help of spreadsheet in excel to reach a final conclusion.

3.10 PRESENTATION OF DATA

It is the last stage of survey. Through good presentation, significant facts and comparisons are
highlighted. The presentation of facts done by preparing charts like bar chart, pie chart etc in the
excel.

Reasons For Selecting Sample Survey

Sample survey was preferred as the means of data collection to explore the existence of the
perception phenomenon, as a sample survey is extensive in scope. Use of a representative sample
in a survey reduce problems of sample bias and allow generalizing the result to the present
population. Data collection can take place in any setting. It is assumed that the respondents
replies generally remain uninfluenced by the setting in which they are given. Data are obtained
directly from the respondent.

51
Limitations :-There are possibilities of the information being biased. Bias can be both deliberate
and non-deliberate. Non-deliberate bias crept in the form of approximation when respondent
were asked to supply information on some past event which they do not exactly remember. Use
of standardized response formats in many questions forced respondents to subscribe to
statements to which they do not fully endorse.

3.11 REASON FOR SELECTING QUESTIONNAIRE AS THE DATA

COLLECTION TECHNIQUES
It is relatively inexpensive mode of data collection. It covers wider geographical area at a
relatively low cost per respondent. It presents a uniform stimulus to all respondent i.e. each
respondent receives an identical questionnaire. It enables the respondent to answer question –
perhaps those of personal or embarrassing nature – more willingly and accurately. It can be
answered at the convenience of the respondent.

3.12 STATISTICAL TOOLS & TECHNIQUES

The data was collected and tabulated and their percentages were calculated and then weighted
average was calculated and ranks were allotted. According to weighted average finally graphs are
used to explain the collected data. For the calculation of weighted average we use the formula:
Xw = W1 (F1 X1) + W2 (F2 X2) + ……. + Wn (Fn Xn) / W1 + W2+ …… + Wn

Where:
1 Xw represent the weighted average; X represents the variable, i.e., X1, X2,…..,Xn.
2 W represents the weights attached to variable value, i.e., W1, W2,…..Wn, respectively.
3 F represents the frequencies, F1, F2,……Fn are the frequencies of the variable values
X1, X2,……,Xn respectively.

52
3.13 LIMITATIONS OF STUDY

1. An executive of the company does not allow conducting survey within an organization during
office hours.
2. Workers have no time to fill the questionnaire.
3. Workers always try to hide the real information.
4. The sample size is smaller, hence finding becomes difficult.
5. The sample size is based on convenience sampling. The short contingencies sampling may
affect the finding of study.

CHAPTER -4
ANALYSIS & DISCUSSIONS

This chapter deals with analysis and discussions of various factors, which tell us about the
satisfaction level of the respondents, next part covers the various factors that contribute in
development of industrial relations. After that there is some suggestions, which help in
improving the industrial relations. Last part deals with the factors that enhance the industrial
relations.

4.1 GENERAL PROFILE OF RESPONDENTS

The profile of respondents deals with various factors like age, gender, marital status, family,
number of children’s income and type of worker.

53
4.1.1 AGE OF RESPONDENTS
Age is considered to be an inherited characteristic because it is determined by birth. Younger
people are expected to be more energetic, innovative adventures, ambitious and risks taking
where as old people are supposed to be conservatives, ambitious and risks taking where as old
people are supposed to conservative, less adaptable.
Table 4.1.1 shows about the Age of the respondents:
AGE (YEAR) NO. OF RESPONDENTS PERCENTAGE
20-30 11 37
30-40 7 23
40-50 7 23
Above-50 5 17

Table 4.1.1 shows the age of respondents where maximum numbers of respondents are in the age
of 20-30. It shows that maximum no. of are young 7, 7 respondents are in the age of 30-40, 40-
50 respectively and 5 respondents are in the age of above 50.

54
 NO. OF RESPONDENTS

12

10

6 NO. OF RESPONDENTS

0
20-30 30-40 40-50 Above-50

Fig 4.1.1

Fig 4.1.1 show that 20-30 ages of respondents are more in the company because they are more
energetic, adventurous. The no. respondents above 50 are less because they are less energetic and
adventurous. They are not able to take risk in their job. They want only job security.
4.1.2 GENDER OF RESPONDENTS
Being a male or female is genetic in nature and it is considered to be an inherited feature. The
tradition view was that man is tougher than women are highly emotional than men. Difference
between men and women will affect their job performance.
Table 4.1.2 shows about the Gender of the respondents:
GENDER NO. OF RESPONDERTS PERCENTAGE

MALE 30 100
FEMALE 0 0

This table shows the gender of respondents in production department. Total no. of male
respondents are 30 in the working place. So, this means that 100 percent are males in the plant
women are not allowed to work at risky places.

55
 35

30

25

20
GENDER
NO. OF RESPONDERTS
15

10

0
1 2 3

Fig 4.1.2
This fig. 4.1.2 shows that mostly workers in service department because the males are more able
to work on machinery but females are 0% in service department and women have more
responsibility on them than men. So women’s turnover is also mare than men. The reasons for
high turnover can be that sometimes the females have to quit their jobs to look after the children
and their homes.

4.1.3 MARITAL STATUS OF RESPONDENTS

Marital status of the respondents always effect on their job performance. A married person has
more responsibility then an unmarried person. Married persons are less absenteeism, less
turnover and more job satisfaction as compared to unmarried workers.
Table 4.1.3 shows about the Marital status of the respondents:
Marital status No. of respondents Percentage
Married 19 63
Unmarried 11 37

Table 4.1.3 shows about the marital status of the respondents that are in the company.
Respondent
in company are almost married, it means that mostly workers are married.

56
 20

18

16

14

12
Marital status
10
No. of respondents
8

0
1 2 3

Fig 4.1.3

The above fig. 4.1.3 shows that most of the respondents are married because unmarried workers
are not stable on their job. They change their job after some time but married persons are more
responsible. They have more responsibility of their family and must fulfill their demands. That’s
why married persons are more stable with their jobs.

4.1.4 FAMILY GROUP OF THE RESPONDENTS

Family group of the respondents are also effect the performance of the job. Joint family have
more burden than single family feel more relax than the joint family. Single family respondents
may pay more concentration on their because of their fewer burdens.
Table 4.1.4 shows about the Family group of the respondents:
Family No. of respondents Percentage

Single 14 43.66

Joint 16 53.33

Table 4.1.4 shows that mostly workers are living in joint family because they have less
responsibility than single family If the respondents have less responsibility then they should do

57
their job with full concentration.

18

16

14

12

10
Family
No. of respondents
8

0
1 2 3

Fig 4.1.4

This fig shows that respondents living in joint family are more then single family because in joint
family responsibility are less then in the single family.

4.1.5 INCOME OF THE RESPONDENTS

Income of the respondents have also too much effect on the job satisfaction. If the incomes of the
respondents are more then they meet their basic need easily. It effects the life of the respondents.
Table 4.1.5 shows about the Income of the respondents:
Income (Rs) No. of respondents Percentage
Below 5000 0 0
5000-10000 8 26.67
Above 10000 22 73.33

This table shows that 8 respondents having income are in between 5000-100000 and 22
respondents having income are more then 10000rs. Respondents who have income more then

58
10000rs are satisfied with their income and done their work with full concentration.

No. of respondents

25

20

15

No. of respondents

10

0
Below 5000 5000-10000 Above 10000

Fig 4.1.5
This table shows that no respondent has income below 5000; respondents having income are in
between 5000-100000 and 22 respondents having income are more then 10000rs. So, the
respondents who have income are more then 10000rs they meet their basic needs easily. It affects
the life of respondents. Respondents who having income more then 10000rs they are satisfied
with their income and done their work with full concentration.

4.1.6 TYPE OF WORKERS

Workers that are recruited by the company are skilled persons because skilled persons know how
they work and have better knowledge of all things.
Table 4.1.6 shows about the Types of worker of the respondents:
Type of workers No. of respondents Percentage

Skilled 30 100

Semi-skilled 0 0

Unskilled 0 0

This table shows that all the respondents are skilled. Only skilled persons are recruited because

59
they have better knowledge about doing work. They should be trained so that’s why they work
better then unskilled or skilled.

No. of respondents

35

30

25

20
No. of respondents
15

10

0
Skilled Semi-skilled Unskilled

Fig 4.1.6
Fig 4.1.6 given us the information about qualification of the respondents. From this fig we
conclude that almost all the respondents are skilled. The company only selects skilled persons so
that they work with full concentration.

4.2 FACTORS CONTRIBUTION IN DEVELOPING INDUSTRIAL

RELATIONS
Following are the various factors that contribute in developing industrial relation:-

4.2.1 ECONOMIC FACTORS

Economic factors play an important role in the development of industrial relations. Various
factors like proper wages and salary, bonus, incentives etc are given to the employees to
motivating their work. Poor wages and poor working conditions are the main reasons for
unhealthy relations between management and workers.

60
Table 4.2.1 shows about the Economic factors:
ATTRIBUTES WEIGHTED AVERAGE RANKS
Proper wages and salary 2.8 1
Bonus 2.73 2
Incentives 2.73 2
Rewards 2.63 3
Holidays package 2.63 3

Table shows that mostly respondents are satisfied with proper wages and salary because they get
the salary on time and get wages and salary according to their work but respondents are not
much satisfied with rewards and holidays packages because they are not given any holidays
packages.

4.2.2 ORGANIZATIONAL FACTORS

Organizational factors also have to much affect in developing industrial relations. Organizational
causes of poor industrial relations includes non recognition of trade union, unfair trade practices

Table 4.2.2 shows about the Organization factors:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Proper human relations 1.93 5
Proper communication system 2.06 4
Recognition of trade union 2.20 3
Worker participation in mgt. 2.26 2

61
 Code of conduct 2.46 1
Adoption of new technology 2.46 1

Table4.2.2 shows that employees are satisfied with code of conduct, adoption of new technology
because workers get knowledge about new technology and done their work with in small time.
They are also satisfied with their code of conduct. Workers are not satisfied with proper human
relations between employer’s employees because sometimes employer’s behaviors are not good
toward their employees.

4.2.3 SOCIAL FACTORS

A social factor also contributes in the development of industrial relations. If the workers are
satisfied with their jobs then there are no conflicts within the organization. Tensions and conflicts
in society also affect good industrial relations.

Table 4.2.3 shows about the Social factors:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Job satisfaction 2.66 1
Settling of disputes 2.40 3
Stress management 2.46 2

62
This table covers the various aspects like satisfaction of the respondents regarding their jobs
because they get all things are necessary in day to day life. Respondents are not satisfied with
settlements of disputes because management does not make decisions in favor of employees.

4.2.4 PSYCHOLOGICAL FACTORS

Psychological factors are also very important for the development of industrial of relations. It
include job security, culture of organization, recognitions of performance, authoritative
administration, interpersonal relations etc. It plays an important role in industrial relations. If
there is no job security, non recognition of performance, having not a good culture in the
organization etc then it leads to the unsatisfactory industrial relations.

Table 4.2.4 shows about the Psychological factors:

63
ATTRIBUTES WEIGHTED AVERAGE RANKS

Proper job security 2.40 2

Good organizational culture 2.33 3

Recognition of performance 2.60 1

Authoritative administration 2.26 4

Good interpersonal relations 2.20 5

The above table shows that employees are satisfied with recognition of performance. If
performance of employee’s should be recognized according to their work then employee’s feel
satisfied with their work and it help in the development of the good industrial relation. If there is
good relation between the employers and employees it will increase the satisfaction level of both
employers as well as employees but employees are not satisfied with interpersonal relations
because there are no good relations between employers and employees.

4.2.5 POLITICAL FACTORS

Political factors are also play an important role in the development of industrial relations.
Political nature of trade union, multiple unions and inter union rivalry weaken the industrial
relations. There should be single and strong trade union to make the good industrial relations.

Table 4.2.5 shows about the Political factors:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Good nature of trade union 2.43 4

64
Single and strong trade union 2.73 1
Proper movement of trade union 2.60 3
Reduction legislative boundaries 2.66 2

This table tells us about the satisfaction and dissatisfaction of the respondents regarding political
factors. Respondents are satisfied with single and strong trade union because it contributes too
much in developing industrial relations. Respondents are not satisfied with the nature of trade
union because management does not make decisions in favors of employees.

4.3 FACTORS REGARDING IMPROVEMENT OF INDUSTRIAL

RELATIONS
1. Following are the factors regarding industrial relations:-
4.3.1 TOP MANAGEMENT SUPPORT
Supports of the management also play an important role in industrial relations. If the
management helps in solving there problems then the respondents do there work with full
concentration. Then they feel satisfied with there jobs.

65
Table 4.3.1 shows about the Top management support factor :
ATTRIBUTES WEIGHTED AVERAGE RANKS
Proper grievance handling procedure 4.46 1
Motivating the workers 4.46 1
Participation of the worker in decision 4.40 3
making
Providing authorities and responsibility 4.43 2

This table shows various factors by which respondent are satisfied. Respondents are satisfied
with proper grievance handling procedures and motivation of the workers because if there are
disputes in the company grievance procedure is very effective and they also motivating the
workers regarding there jobs. Respondents are not satisfied with participation of workers in
decision making because management does not give any chance to participation in decision
making.

4.3.2 SOUND PERSONNEL POLICIES

Practices and procedures should be developed to put into practices. The purpose of policies is to
decide a large number of problems which crop up everyday during the working of organization.
Sound policies and rules are executed objectively and equitably at all the levels of an
organization.

Table 4.3.2 shows about the Sound personnel policies of organization:

ATTRIBUTES WEIGHTED AVERAGE RANKS

66
Policies regarding human 4.45 3
relations
Proper layout of policies 4.47 2
Rules defined properly 4.63 1

This table tells us about the personnel policies regarding industrial relations. Respondents are
satisfied with the rules that are defined in the company because all work done in the company is
according to the pre-define rules. Respondents are no satisfied with the policies regarding human
relation because the human relations are not so good in the company.

4.3.3 POSITIVE ATTITUDE

Positive attitude have effect on the industrial relations. Both management and trade union should
adopt positive attitude towards each other. Unions and workers should recognize and accept the
rights of employees. Management must recognize trade union as the representative of workers
and spokesman.

Table 4.3.3 shows about the Positive attitude of the respondents:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Positive attitude of management 4.73 1

67
towards employees
Adaptation of positive attitude by 4.40 3
management trade union
Recognition of trade union 4.66 2
Positive attitude of trade union 4.66 2
towards employees

This table shows about the importance of positive attitude in the development of industrial
relations. Respondents are satisfied with the positive attitude of the management because
management provides helps if there is any problems to the employees regarding their work.

4.3.4 COLLECTIVE BARGAINING

Collective bargaining plays an import role in the development of industrial relations. The
industrial peace can be maintained only if the employees and employers settle their disputes
through negotiation and consultation rater than the intervention of the third party. Collective
bargaining is a process though which employees issues are settled through mutual discussions
and negotiation through a give and take approach.

Table 4.3.4 shows about the Collective bargaining factor:

ATTRIBUTES WEIGHTED AVERAGE RANKS

68
 Enhance the industrial peace 4.47 1
Reduce communication gap 4.47 1
Remove intervention of government 4.30 3
Adoption give and take approach 4.46 2
Enhance the morale of workers 4.46 2

This table tells us about the satisfaction levels regarding collective bargaining. Responds are
satisfied with the industrial peace because collective bargaining helps a lot in industrial relations.
They are not satisfied with interference of government because they do not want the government
intervention.

4.3.5 SUPERVISORY TRAINING

Job supervisory should be trained thoroughly to ensure that organizational policies and practices
are properly implemented and carried into effect. The supervisors should also be trained in
leadership and communication.

Table 4.3.5 shows about the Supervisory training factor:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Supervisor should be trained in 4.86 1

69
leadership
Proper communication skills 4.86 1
Well qualified 4.86 1
Intelligent 4.86 1

Table 4.3.5 shows about the satisfaction levels regarding supervisory training. All the
respondents are satisfied with the factors of the supervisory training because it helps a lot in
reducing communications gap. The supervisors should be trained in leadership, intelligent, well
qualified then only he can become good supervisor.

4.3.6 CAREER DEVELOPMENT

Career development in also very important in development of industrial relations. If the
respondents are given education, training etc then he becomes perfect in his work.

Table 4.3.6 shows about the Career Development factor:

ATTRIBUTES WEIGHTED AVERAGE RANKS

Education 4.86 1

70
Training and development 4.86 1

For career development education, training etc should be provided to the development of the
employees. It also helps in motivating the employees towards their work. Respondents are
satisfied with career development because training, education plays an important role in
industrial relations.

4.3.7 HEATH AND SAFETY

Health and safety measures should be there to motivating their employees. It plays an important
role in industrial relations.

Table 4.3.7 shows about the Heath and Safety factor:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Medicine 4.86 1

71
Dispensary 4.80 2
Ambulance 4.70 3

Table 4.3.7 shows that respondents are satisfied with medicine facility because this facility is
provided by the company to the employees. They are not satisfied the ambulance facilities
because sometimes this facility is provided and sometimes this facility is not provided to the
employees.

4.4 EFFECT OF INDUSTRIAL RELATIONS ON ORGANISATION,

EMPLOYEES & EMPLOYERS

4.4.1 ORGANIZATION
Organization is a place where the respondents work. Industrial relations effect the organization
up to large extent, if the industrial relations are good then it increases the goodwill of the
organization, enhance the profits, increase the productivity and smooth running of the
organization etc.

72
Table 4.4.1 shows about the Organization:
ATTRIBUTES WEIGHTED AVERAGE RANKS
Increase goodwill 4.86 1
Enhance the profits 4.53 3
Increase productivity 4.46 2
Proper utilization of resources 4.46 2
Smooth running of organisation 4.46 2

From weighed average we conclude that respondents are much satisfied that industrial relations
increase the goodwill of an organization because industrial disputes effect the goodwill of an
organization and respondents are not much satisfied with the smooth running of the organization.

4.4.2 EMPLOYEES
Employees are the persons who work in the organization under the employers for meeting their
basic needs. Employees play an important role in the profitability of an organization.

Table 4.4.2 shows about the Employees in the organization:

ATTRIBUTES WEIGHTED AVERAGE RANKS
Job satisfaction 4.36 1
High morale 4.36 1

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 Positive attitude 4.26 2
Good relation with employers 4.26 2
Increase productivity 4.36 1
Enhance participation in prob. Solving 4.20 3
Reduce the labour turnover 4.36 1

From the above table we conclude that respondents are satisfied with their jobs because if there
is job satisfaction then it increases the productivity, reduce the labour turnover and increase the
morale of the employees.

4.4.3 EMPLOYER
Employer is a person under whom the employees work. It is the responsibility of the employer to
get the work done through employees. The industrial relations become good if the employers
have good relations with employees then it will helps in increase the profits, easily settlement of
disputes etc.

Table 4.4.3 shows about the Employer in the organization:

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ATTRIBUTES WEIGHTED AVERAGE RANKS
Proper supervision 4.7 2
Good relation with employees 4.7 2
Increase productivity 4.6 2
Increase profits 4.6 3
Positive attitude towards workers 4.7 3
Proper settlement of disputes 4.8 1

The above table shows about the satisfaction level of employees towards employers. They are
satisfied that disputes are easily settled by the employers and it also helps in the development of
industrial relations. Employees are not satisfied with increase productivity and increase the
profits because there are not depend on employer but only on the work of employees.

4.5 OTHER FACTORS THAT ENHANCE INDUSTRIAL RELATIONS

4.5.1 Contribution of employer towards employees
Following are the factors that enhance industrial relations:
4.5.1(a) Working conditions -Working conditions also play an important role in industrial
relations. Trade union aim to improve working condition by securing shorter working hours,
better leave facilities, adequate social security, better housing and condition and other welfare
benefits.

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Table 4.5.1(a) shows about the Working conditions of organization:

ATTRIBUTES WEIGHTED AVERAGE RANKS

Proper rest rooms 4.6 1
Proper working hours 4.6 1
Adequate machinery and equipment 4.6 1
Clean and ventilation work place 4.6 1
Proper leave pattern 4.6 1
Proper discipline and rules 4.6 1

This table shows that all the respondents are fully satisfied with working conditions because they
get proper rest rooms when they feel tired, proper working hours, adequate machinery and
equipment, clean and ventilated work place, proper leave pattern and there are proper rules
disciplines.

4.5.1(B) MONETARY FACTORS

Monetary factors are also very important for good performance of employees. These are related
to proper wages, salary, incentives, rewards, bonus. These factors highly motivate the workers. If
all these facilities are given to the employees then it will help in development of industrial
relations.
Table 4.5.1(b) shows about the Monetary factors:
ATTRIBUTES WEIGHTED AVERAGE RANKS

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Wages and salary 2.80 1
Proper bonus 273 2
Remuneration 2.73 2
Incentive 2.66 3
Reward 2.60 4

The table 4.5.1(b) shows that the respondents are fully satisfied with the wages and salary
because they get proper wages and salary according to their work and also in time but the
respondents are not satisfied with reward system because rewards are not given for recognition
of better performance.

4.5.1(C) NON- MONETARY

Non-monetary factors are also play an important role in industrial relations. It includes
recognition, word of praise, job security etc. the non-monetary factors also help to encourage the
workers of the respondents.

Table 4.5.1(c) shows about the Non- monetary factors:

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ATTRIBUTES WEIGHTED AVERAGE RANKS
Recognition 4.36 2
Word of praise 4.40 1
Job security 4.20 3

The above table shows that respondents are satisfied with word of praise because recognition of
work is through word of praise nut they are not satisfied with job security because there is no
security to jobs of the respondents.

4.5.1(D) WELFARE ACTIVITIES

Welfare activities are also necessary for the enhancement of the industrial relations. It includes
accommodation, transportation, laws and parking, educations, medicine, summer camp etc. all
these factors contributes in the development of industrial relations.

Table 4.5.1(d) shows about the Welfare activities in the organization:

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ATTRIBUTES WEIGHTED AVERAGE RANKS

Accommodation 3.53 4

Transportation 3.53 4

Lawn and parking 4.00 3

Education 3.53 4

Medicine 4.20 2

Summer camp 4.73 1

The table shows that respondents are much satisfied with summer camp because summer camp is
organized every year in which employees are allowed to participate. The respondents are not
satisfied with accommodation, transportation and education because housing facilities, education
facilities and transportation facilities are not provided to the respondents.

4.5.2 CONTRIBUTION OF EMPLOYEES TOWARDS EMPLOYER

Table 4.5.2 shows about the Contribution of employees towards employer:
ATTRIBUTES WEIGHTED AVERAGE RANKS
Follow orders of employers 5 1
Having a feeling of loyalty 5 1
Committed toward assigned work 5 1

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This table shows that it is a give take approach. If the respondents follow orders of the
employers, having a feeling of loyalty and belongingness, committed towards assigned work etc
then the productivity increases and in the same way behavior or attitude of the employers
becomes positive toward employees.

CHAPTER 5

SUMMARY, CONCLUSION & RECOMMENDATIONS

5.1 SUMMARY
Industrial relations refers to the between management and employees or among

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employees and their organizations that arise out of employment. Industrial relations involve two
Parties-employees, without whom these relations cannot exits. The main purpose of industrial
relations is to maintain harmonious relationship between management and labour. I have
conducted a survey on “Industrial Relations” in Nestle India Limited, Moga to analyses the
industrial relation. From the survey I concluded that mostly employees are in the age group
between 20-30 it shows that maximum no. of employees are of young age and these persons are
more energetic, adventures, ambitions and risk taking. Almost all the employees in the company
are male. Permanent employees are married and mostly living in joint families. Maximum
employees have children only two or less than two. All the employees are satisfied with their
income become all have 10000 and all the employees on the permanent basis are skilled.
Employees are satisfied are with their wages and salary because they get the salary & wages on
time. By this they meet their basis needs easily. Economic factors play an important role in the
development of industrial relations. Various factors like proper wages and salary, bonus,
incentives etc are given to the employees to motivating their work. Organizational causes of poor
industrial relations include non-recognition of trade union, unfair trade practices etc. social
factors also contributes in the development of industrial relations.

If the workers are satisfied their jobs then there is no conflicts with in the
organization. Tensions and conflicts in society also affect good industrial relations. Psychological
factors are also very important for the development of industrial relations. It include job security,
organizational culture, recognitions of performance, interpersonal relations etc. It plays an
important role in industrial respondents are not satisfied with the nature of trade union because
management do not make decisions in favor of employees. If the management helps in solving
there problems then the respondents do there work with full concentration. Then they feel
satisfied with their jobs practices and procedures should be development to put into practices.
The purpose of policies is to decide a large number of problems which crop up everyday during
the working of organization both management and trade union should adopt positive attitude
towards each others. Unions and workers should recognize and accept the rights of employees.
Management must recognize trade unions as the representatives of workers and spokesman. The
industrial peace can be maintained only if the employees and employer settle their disputes
through negotiation and consultation rather than the intervention of the third party.

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 Collective bargaining is a process through which employee issues are settled
through mutual discussions and negation through give and take approach. Job supervisors should
be trained thoroughly to ensure that organizational policies and practices are properly
implemented and carried into effect. The supervision should also be trained in leadership and
communication. Career development is also very important in development of industrial
relations. If the respondents are given education, training etc. then he become perfect in his
work. Health and safety measures should be motivating their employees. It plays an important
role in industrial relations. Organization is a place where the respondents work. Industrial
relations effect the organization up to large extent, if the industrial relations are good then it
increase the goodwill of the organization, enhance the profits, increase the productivity, smooth
running of the organisation etc. employees are the persons who work in the organization under
employers for meeting their basic needs. Employees play an important role in the profitability of
an organization.

Employers are the persons under whom the employees work. It is the
responsibility of the employers to get the work done through employees. The industrial relation
become good if employers have good relation with employees then it will help in increase the
profits, easily settlements of disputes etc. working condition also play an important role in
industrial relations. Trade union aim to improve working condition by securing shorter work
hours, better leaving facilities, adequate social security, better housing, education and other
welfare benefits. Monetary factors are also very important for good performance of employees.
These are related to proper wages, salary, incentives, rewards, bonus. These factors are highly
motivates the workers. If all these facilities are given to the employees then it will help in
developing of industrial relations. Non-monetary factors are also play important role in industrial
relations. It includes recognition, word of praise, job security etc. all these factors contribute in
the development of industrial relations. If the respondents following order of the employers,
having a feeling of loyalty and belongingness, commuted towards assigned work etc then the
productivity increases and in the same way behavior or attitude of the employers becomes
positive towards employees.

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5.2 CONCLUSION
Industrial relations refers to the relationship between management and employees or among
employees and their organization that arise out of employment. Industrial relation involves two
parties-employers and employees, without whom these relation can not exist. The main purpose
of industrial relations is to maintain harmonious relationship between management and labour.
Employees are satisfied with their wages and salary because they get the wages and salary on
time. Various factors like proper wages and salary, bonus, incentives, etc. are given to the

83
employees to motivating their work. Psychology factors also very important for the development
of industrial relation.

It includes job security, organisation culture, reorganization of performance,

interpersonal relations etc. Support of management also plays an important role in industrial
relations. Both management and trade union should adopt positive attitude towards each other.
The industrial peace also maintained only if employers and employees settle their disputes
through negotiation and consultation rather than the intervention of the third party. Collective
bargaining is a process through which employee issues are settled through mutual discussions
and negotiation through a give and take approach. Health and safety measures should be there to
motivating their employees. Industrial relations affect the organization up to large extent, if the
industrial relation are good then it increase the goodwill of the organization, enhance the profits,
increase the productivity, smooth running of the organization etc. Working condition also play an
important role in industrial relation. Monetary factors are also for good performance of
employees. These are related to proper wages, salary, incentives, rewards and bonus. Non-
monetary factors also play an important role in industrial relations. It includes recognition, word
of praise, job security etc.

The non-monetary factors also helps to encourage the works of the

respondents. Welfare activities are also necessary for the enhancement of industrial relations. It
include accommodation, transportation, lawn and parking, education medicine, summer camp
etc. If the respondents follow order of the employers, having a feeling of loyalty and
belongingness, commuted towards assigned work etc. then the productivity increases and in the
same way behavior or attitude of employers becomes positive towards employees.
5.3 RECOMMENDATIONS
1. Executives of the company should allow the outsiders to conduct survey.
2. There is little top management support in the organization. So, as to make a good
interpersonal relation in the organization.
3. There is an interference of political parties in the organization. If they want good relations
in the organization then there should be single and strong trade union in the organization.
4. There should be positive attitude between employees, employees and employers to make

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 better industrial relations.
5. There is no much collective bargaining in the company so it is better if the company
adopt collective bargaining to settle the disputes in the company through mutual
negotiation.
6. Proper grievance handling procedure should be adopt to settle the disputes in the
company.

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