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Chapter: Business Science : Industrial Relations and Labour Welfare : Industrial Relation

Importance of industrial relation

Good industrial relation reduces 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.

Importance of industrial relation


Ø    Uninterrupted production


Ø    Reduction in Industrial Dispute


Ø    High morale - Industrial relation improves the morale of employees


Ø    Mental revolution


Ø    Economic growth and Development


Ø    Discourages unfair practices


Ø    Enactment of statutory provisions


Uninterrupted Production

Ø  To ensure continuity of production.


Ø  continuous employment for all from manager to workers


Ø  The resources are fully utilized, resulting in the maximum possible production. There is uninterrupted flow of income for all.


Reduction in Industrial Disputes


Good industrial relation reduces 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.


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.


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 Government to work out a new relationship in consonance with a spirit of true democracy.


New Programmes


New programmes for workers development are introduced in an atmosphere of peace such as training facilities, labor welfare facilities etc. It increases the efficiency of workers resulting in higher and better production at lower costs.


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.


Functional Requirements Of A Successful Industrial Relations Programme

Top Management Support:


Since industrial relations is a functional staff service, it must necessarily derive its authority from the line organization. This is ensured by providing that the industrial relations director should report to a top line authority to the president, chairman or vice president of an organization.


Sound Personnel Policies:


These constitute the business philosophy of an organization and guide it in arriving at its human relations decisions. The purpose of such policies is to decide, before any emergency arises, what shall be done about the large number of problems which crop up every day during the working of an organization. Policies can be successful only when they are followed at all the level of an enterprise, from top to bottom.


Adequate Practices should be developed by professionals:


In the field to assist in the implementation of the policies of an organization, a system of procedures is essential if intention is to be properly translated into action. The procedures and practices of an industrial relations department are the ―tool of management‖ which enables a supervisor to keep ahead of his job that of the time-keeper, rate adjuster, grievance reporter and merit rater.


Detailed Supervisory Training:


To ensure the organizational policies and practices are properly implemented and carried into effect by the industrial relations staff, job supervisors should be trained thoroughly, so that they may convey to the employees the significance of those policies and practices. They should, moreover, be trained in leadership and in communications.


Follow-up of Results:


A constant review of an industrial relations programme is essential, so that existing practices may be properly evaluated and a check may be exercised on certain undesirable tendencies, should they manifest themselves. A follow up of turnover, absenteeism, departmental morale, employee grievances and suggestion; wage administration, etc. should be supplemented by continuous research to ensure that the policies that have been pursued are best fitted to company needs and employee satisfaction. Hints of problem areas may be found in exit interviews, in trade union demands and in management meetings, as well as in formal social sciences research.


Difference between industrial relations and human relations:

The term ―Industrial Relations‖ is different from ―Human Relations‖. Industrial relations refer to the relations between the employees and the employer in an industry. Human relations refer to a personnel-management policy to be adopted in industrial organizations to develop a sense of belongingness in the workers improves their efficiency and treat them as human beings and make a partner in industry.


Industrial relations cover the matters regulated by law or by collective agreement between employees and employers. On the other hand, problems of human relations are personal in character and are related to the behavior of worker where morale and social elements predominated. Human relations approach is personnel philosophy which can be applied by the management of an undertaking. The problem of industrial relations is usually dealt with a three levels – the level of undertaking, the industry and at the national level. To sum up the term ―Industrial Relations‖ is more wide and comprehensive and the term ―Human Relations‖ is a part of it.


Suggestions to Improve Industrial Relation


Both management and unions should develop constructive attitudes towards each other


All basic policies and procedures relating to Industrial Relation should be clear to everybody in the organization and to the union leader. The personnel manager must make certain that line people will understand and agree with these policies.


The personnel manager should remove any distrust by convincing the union of the company‘s integrity and his own sincerity and honesty. Suspicious, rumors and doubts should all be put to rest.


The personnel manager should not vie with the union to gain workers‘ loyal to both the organization. Several research studies also confirm the idea of dual allegiance. There is strong evidence to discard the belief that one can owe allegiance to one group only.


Management should encourage right kind of union leadership. While it is not for the management to interfere with union activities, or choose the union leadership, its action and attitude will go a long way towards developing the right kind of union leadership. ―Management gets the union it deserves‖ is not just an empty phrase.



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