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INDUSTRIAL RELATIONS – AN OVERVIEW B.Com 5/4/2015 1 santhi naryanan.

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Presentation on theme: "INDUSTRIAL RELATIONS – AN OVERVIEW B.Com 5/4/2015 1 santhi naryanan."— Presentation transcript:

1 INDUSTRIAL RELATIONS – AN OVERVIEW B.Com 5/4/ santhi naryanan

2 Worker’s taking to streets…….???? 5/4/2015santhi naryanan 2

3 ACTION TAKEN BY WORKERS  On 19 October workers from Rico Auto embarked on a strike and were later joined by workers from other companies like Hero Honda, Honda, Suzuki etc. 5/4/ santhi naryanan

4 5/4/ santhi naryanan

5 Police beating HONDA workers 5/4/ santhi naryanan

6 Clash between Police and workers 5/4/ santhi naryanan

7 Introduction  An industry is a social world in miniature. Associations of various persons, workmen, supervisory staff, management and employer in industry create industrial relationships.  This affects the economic, social and political life of the whole community. 5/4/ santhi naryanan

8 Introduction  Thus, industrial life creates a series of social relationship which regulate the relations and working of not only workmen and management but also of community and industry. Industrial relations are inherent in an industrial life 5/4/ santhi naryanan

9 Industrial relations  It refers to the complex human relationships which emerge in work situations  Industrial Relations are a bonding between the employee and employer.  It also adds many other relations which are chain of previous relations.  So the motto of any industry should be sustaining good relationships between the employer and employee. 5/4/ santhi naryanan

10 Introduction santhi naryanan 10  Delicate and complex problems of modern industrial society  Managers spend sleepless night in facing the competitions in the industry.  New strategies are continuously devised to face the same.  One of it is to increase productivity  Productivity can be improved by good industrial relations 5/4/2015

11 Meaning  It is concerned with the relationship between the management and workers and the role of regulatory mechanism in resolving any disputes 5/4/ santhi naryanan

12 Views on Industrial relations 12 Industrial relations has traditionally been a fire fighting function in our country. The IR man comes into full play only after the crisis erupts. (Aswhathapa) Industrial relations arise in any setting where somebody hires the work/services of someone else offering a reward. (BD Singh) 5/4/2015

13 Definitions  “ The field of industrial relations include the study of workers and their trade unions, management, employers’ association and state institutions concerned with the regulation of employment” – H.A Clegg 5/4/ santhi naryanan

14 Definitions santhi naryanan 14 Dale Yoder – ‘Relationships between management and employees or among employees and their organisation that characterize or flow out of employment.’ Labour dictionary- ‘Industrial relations is the art of living together for purpose of production’. 5/4/2015

15 Evolution of IR santhi naryanan 15 IR has its roots in the economic and social changes caused by industrial revolution. Capitalist system of productionChanges caused by IT revolutionGlobalisation Changes of mobility in labour, capital and jobs 5/4/2015

16 Parties to IR Employees Employee Associations/Trade Unions GovernmentEmployers Employers Association Courts and Tribunals 5/4/ santhi naryanan

17 Major issues involved in the IR process. santhi naryanan 17 Terms of employment (wages, DA, Bonus, fringe benefits) Working conditions (leave, working hours, health, safety and welfare) Non employment Personal issues (Disciplinary action) (recognition of trade unions) 5/4/2015

18 Features of Industrial relations  IR do not emerge in vaccum  It has two faces – Co-operation and conflict  Industrial relations is a dynamic socio-economic process. Part of a larger system  Involves study of conducive environments  IR examines the impact of law on the co operation between the labour and management 5/4/ santhi naryanan

19 Importance of IR 5/4/2015santhi naryanan 19  Promotion and development of healthy labour- management relationships  Maintanence of Industrial Peace and avoidance of Industrial strife  Development of industrial democracy  Sound IR gets unreserved employee co operation  It prevents industrial disputes

20 INTRODUCTION TO LABOUR LEGISLATIONS 5/4/2015 santhi naryanan 20

21 Introduction  Labor law arose due to the demands of workers for better conditions, the right to organize, and the simultaneous demands of employers to restrict the powers of workers' many organizations and to keep labor costs low. 5/4/2015santhi naryanan 21

22 Factors that influenced the labour legislations  Early exploitative Industrial society  Impact of revolution  Growth of trade unionism  End of colonial rule  Extension of adult franchise  Rise of socialist and revolutionary ideas  Growth of humanitarian ideas  Concept of social welfare and social justice  Establishment of ILO  Revolution in science and technology 5/4/2015santhi naryanan 22

23 Labour Legislation in India  The history of labour legislation in India is naturally interwoven with the history of British colonialism. The industrial/labour legislations enacted by the British were primarily intended to protect the interests of the British employers. Considerations of British political economy were naturally paramount in shaping some of these early laws. 5/4/2015santhi naryanan 23

24 Contd -  Some of the earliest Acts were:  Tea District Emigrant Labour Act 1832  Workmen’s Breach of Contract Act /4/2015santhi naryanan 24

25 Major principles of labour legislations  Protection  Social justice  Regulation  Welfare  Social security  Economic development  International obligation 5/4/2015santhi naryanan 25

26 Protective Legislations  Primary purpose - protect Labour standards and to improve working conditions  Factories Act /4/2015santhi naryanan 26

27 Social Security  Primary purpose – To provide workmen social security benefits under certain contingencies of life and work  The Workmen’s Compensation Act, 1923  The Employee State Insurance Act, /4/2015santhi naryanan 27

28 Wage related labour legislations  Legislations laying down the methods and manner of wage payment as well as the minimum wages come under this category.  Payment of wages Act, /4/2015santhi naryanan 28

29 Regulative legislations  Legislations to regulate the relations between employees and employers and to provide for methods and manners of settling industrial dispute. Such laws also regulate the relationship between the workers and their trade unions  Trade Unions Act 1926  Industrial Disputes Act /4/2015santhi naryanan 29

30 PAYMENT OF WAGES ACT /4/ santhi naryanan

31 Purpose  Ensure regularity of payment  To avoid withholding wages, delays in wages  Preventing unreasonable deductions out of wages  Provide remedy to workers against violation of rights 5/4/ santhi naryanan

32 Applicability  It applies in the first instance to the persons employed in any factory.  to persons employed upon by any railway administration  to persons employed in motor transport service, Air transport service  Any other establishment which the central government or state government need to protect the interest of employed.  Persons getting basic wage up to Rs 6500/- 5/4/ santhi naryanan

33 Wages All remuneration due to any worker or employees if the terms of contract of employment are fulfilled. No wage period shall exceed one month. (1) The wages of every person employed upon or in- (a) any railway, factory or industrial or other establishment- >1000- before the expiry of 7 th day of wage period <1000- before the expiry of 10 th day of wage period All payments of wages shall be made on a working day. 5/4/ santhi naryanan

34 PERMISSIBLE OR AUTHORIZED DEDUCTIONS  Deduction for Fines  Deduction for absence from duty  Deduction for recovery of advances  Deduction to be made in case of any amt given to the employee as an advance.  Deduction for recovery of loans  Deductions for income tax  Deduction for provident fund  Deduction for payment of insurance premium. 5/4/ santhi naryanan

35 Maintenance of registers and records  Every employer shall maintain such registers and records giving such particulars of persons employed. by him, the work performed by them, the wages paid to them, the deductions made from their wages, the receipts given by them and such other particulars and in such form as may be prescribed. 5/4/ santhi naryanan

36 Inspectors. 1) An Inspector of Factories appointed under Factories Act, 1948 shall be an Inspector for the purposes of this Act in respect of all factories within the local limits assigned to him. 2) The [State Government] may appoint Inspectors for the purposes of this Act. 5/4/ santhi naryanan

37 Penalty for offences under the Act. Non- payment of wages in time or making unauthorized deduction or imposing un reasonable fines is punishable with fine not less than Rs 200 and not more than /4/ santhi naryanan

38 Contd-  If any person who has been convicted of any offence punishable under this Act is again guilty of an offence involving contravention of the same provision, he shall be punishable on a subsequent conviction with  Imprisonment – 1 months- 6 month  Fine /4/ santhi naryanan

39 MINIMUM WAGES ACT 5/4/ santhi naryanan

40 5/4/ santhi naryanan

41 Introduction  The Minimum Wages Act, 1948 was enacted to safeguard the interests of workers, mostly in the unorganized sector by providing for the fixation of minimum wages in certain specified employments.Minimum Wages Act, 1948  Under the Act, both the Central Government and the State Governments are the appropriate Governments to fix, revise, review and enforce the payment of minimum wages to workers in respect of 'scheduled employments' under their respective jurisdictions. There are 45 scheduled employments in the Central sphere and as many as 1530 in State sphere. 5/4/ santhi naryanan

42 Contd. The Act defines the rate of minimum wages consisting of:  Basic rate of wage  Basic rate with or without cost of living allowances  All inclusive rates 5/4/ santhi naryanan

43 Objective of the Act The main objective of the Act is to prevent exploitation of the employees & fix the minimum wages. 5/4/ santhi naryanan

44 Scope of the Act The Act empowers the state and the central govt. As the case may be to fix minimum wage in respect of worker in following industries:  Agriculture  Construction of building and roads  Manufacturing  0ther factories 5/4/ santhi naryanan

45 Contd.  Different categories: The act permits fixation of different minimum rates of wages for different class of work in the same scheduled employment.  Contents of minimum wages: ( 1) living wages (2)fair wages (3)minimum wages 5/4/ santhi naryanan

46 Contd. 1. Living wages: produce enough in quantity without sacrifcing quality. Components: a. Basic necessaries b. Reasonable expenditure on children education c. Insurance cover againest ill health disability oldage d. Saving for the rainy day e. Some margin for self development 2.Fair wage : Equal pay for equal work 3.Minimum wage: for food, shelter and cloths 5/4/ santhi naryanan

47 Minimum Wages in Uttar Pradesh Sr.No. Scheduled Employment Category of Workers Basic Minimum Wages V.D.A. Total Minimum Wages 1AgricultureUnskilled Automobile repairs Workshops Semi-skilled Skilled Unskilled Construction or maintenance of road or in building operation Semi-skilled Skilled Unskilled /4/ santhi naryanan

48 Fixing & revising the minimum rates of wages  Appropriate govt. Shall fix the minimum rates of wages for person employed.  Govt. Shall review at internal not exceeding five years.  Minimum rate of wages may be fixed either by hour, by day, by month. 5/4/ santhi naryanan

49 EMPLOYEE PROVIDENT FUND ACT 5/4/ santhi naryanan

50 EMPLOYEES’ PROVIDENT FUNDS & MISC. PROVISIONS ACT & THE SCHEME ELIGIBILITY ANY PERSON WHO IS EMPLOYED FOR WORK OF AN ESTABLISHMENT OR EMPLOYED THROUGH CONTRACTOR IN OR IN CONNECTION WITH THE WORK OF AN ESTABLISHMENT. APPLICABILITY EVERY ESTABLISHMENT WHICH IS A FACTORY ENGAGED IN ANY INDUSTRY SPECIFIED IN SCHEDULE 1 AND IN WHICH 20 OR MORE PERSON ARE EMPLOYED. ANY OTHER ESTABLISHMENT EMPLOYING 20 OR MORE PERSONS WHICH CENTRAL GOVERNMENT MAY BY NOTIFICATION, SPECIFY IN THIS BEHALF. ANY ESTABLISHMENT EMPLOYING EVEN LESS THAN 20 PERSONS CAN BE COVERED VOLUNATARILY UNDER SECTION 1 (4) OF THE ACT. 5/4/ santhi naryanan

51 EMPLOYEES’ PROVIDENT FUNDS & MISC. PROVISIONS ACT & THE SCHEME BENEFITS EMPLOYEES COVERED ENJOY A BENEFIT OF SOCIAL SECURITY IN THE FORM OF AN ATTACHABLE AND UNWITHDRAWABLE (EXCEPT I SEVERLY RESTRICTED CIRCUMSTANCES LIKE BUYING HOUSE, MARRIAGE, EDUCATION etc.). FINANCIAL NEST EGG TO WHICH EMPLOYEES AND EMPLOYERS CONTRIBUTE EQUALLY THROUGHOUT THE COVERED PERSONS EMPLOYMENT. THIS SUM IS PAYBLE NORMALLY ON RETIREMENT OR DEATH. OTHER BENEFITS INCLUDE EMPLOYEES PENSION SCHEME AND EMPLOYEES DEPOSITE LINKED INSURANCE SCHEME. 5/4/ santhi naryanan

52 EMPLOYEES’ PROVIDENT FUNDS & MISC. PROVISIONS ACT & THE SCHEME PAYMENT OF CONTRIBUTION THE EMPLOYER SHALL PAY THE CONTRIBUTION PAYBLE TO THE EMPLOYEES PROVIDENT FUND, EMPLOYEES DEPOSITE LINKED INSURANCE, AND EMPLOYEES PENSION FUND IN RESPECT OF THE MEMBER OF THE EMPLOYEES PENSION FUND BY HIM DIRECTLY BY OR THROUGH A CONTRACTOR. IT SHALL BE THE RESPONSIBILITY OF THE PRINCIPAL EMPLOYER TO PAY THE CONTRIBUTIONS PAYBLE TO THE EPF, EDLI AND EPS BY HIM SELF IN RESPECT OF THE EMPLOYEES DIRECTLY EMPLOYED BY HIM AND ALSO IN RESPECT OF THE EMPLOYEES EMPLOYED BY OR THROUGH A CONTRACTOR. 5/4/ santhi naryanan

53 EMPLOYEES’ PROVIDENT FUNDS & MISC. PROVISIONS ACT & THE SCHEME PAYMENT OF CONTRIBUTION EPF EMPLOYERS 12% + EMPLOYEES 3.67% = % EPF ADMIN CHARGES 1.10% EPS EMPLOYEES 8.33 % EDLI 0.50 % EDLI ADMIN CHARGES 0.01% TOTAL = 25.61% 5/4/ santhi naryanan

54 EMPLOYEES’ PROVIDENT FUNDS & MISC. PROVISIONS ACT & THE SCHEME PENAL PROVISION LIABLE TO BE ARRESTED WITHOUT WARRANT BEING A COGNISABLE OFFENCE. DEFAULTS EMPLOYER IN PAYING CONTRIBUTIONS OR INSPECTION-ADMINISTRATIVE CHARGES ATTRACT IMPRISONMENT UPTO 3 YEARS AND FINES UPTO Rs.10,000 (Sec.14). FOR ANY RETROSPECTIVE APPLICATION, ALL DUES HAVE TO BE PAID BY EMPLOYER WITH DAMAGES UPTO 100% OF ARREARS. 5/4/ santhi naryanan

55 EMPLOYEES STATE INSURANCE ACT,1948 5/4/ santhi naryanan

56 Introduction……  The Act is a Landmark in the history of social security in India.  It is an insurance scheme.  Employee gets benefits if he is sick or disabled.  These benefits are secured by financial contributions to the scheme both by employers and employees. 5/4/ santhi naryanan

57 Object of Scheme : To introduce social insurance by providing for certain benefits to employees in case of sickness, maternity and employment injury and for certain other matters in relation thereto. 5/4/ santhi naryanan

58 Applicability of the Act:  The Act extends to whole of India including the State of Jammu & Kashmir.  The Act applies to all factories, other than seasonal factories, run with power and employing 20 or more persons.  Presently, employees whose wages do not exceed Rs per month are eligible for benefits under the Act. 5/4/ santhi naryanan

59 Administration of the Scheme:  The administration of the ESI Scheme, has been entrusted to The Employees’ State Insurance Corporation (ESIC), an autonomous body set up by an act of the Central Government.  The ESIC Board consists of representatives of Central & State Governments, employers, employees, medical profession & the Parliament. 5/4/ santhi naryanan

60 BENEFITS UNDER THE ACT:  Sickness Benefit  Maternity Benefit  Disablement Benefit  Dependents’ Benefit  Medical Benefit  Funeral Expenses 5/4/ santhi naryanan

61 SICKNESS BENEFIT:  It involves periodical payments, to any insured person in case of his sickness, certified by a duly appointed medical practitioner or by any other person, possessing such qualifications as the corporation may by regulations specify. 5/4/ santhi naryanan

62 MATERNITY BENEFIT: It is the periodical payment, to an insured woman,  in case of confinement or mis-carriage or sickness arising out of pregnancy, confinement, pre-mature birth of child or mis-carriage,  being certified to be eligible, by the specified authority. 5/4/ santhi naryanan

63 DISABLEMENT BENEFIT: Are periodical payments, to an insured person,  suffering from disablement, as a result of an employment injury sustained as an employee,&,  certified to be eligible for such payments by a specified authority. 5/4/ santhi naryanan

64 DEPENDANTS’ BENEFIT: Are periodical payments, to the dependents, of an insured person,  who dies as the result of an employment injury sustained as an employee under this Act,&,  are entitled to compensation under this Act. 5/4/ santhi naryanan

65 MEDICAL BENEFIT: An insured person and/or a member of his family, whose condition requires medical treatment and attendance, shall be entitled to receive, medical treatment for and attendance on insured persons, referred to as “Medical Benefit”. 5/4/ santhi naryanan

66 FUNERAL EXPENSES:  In case the insured person dies, the funeral expenses, shall be payable to the eldest surviving member of the family.  In absence of family, such expenses shall be payable to the person who actually incurs the expenditure on funeral of the deceased insured person. 5/4/ santhi naryanan

67 General Provisions Regarding Benefits:  Benefits not assignable or attachable.  Bar of benefits under other enactments.  Cash benefits are not commutable.  Benefits cannot be combined.  Observance of certain conditions on receipt of sickness or disablement benefit.  Employer not to reduce wages.  Employee not to be dismissed or punished by employer during sickness period. 5/4/ santhi naryanan

68 ADJUDICATION OF DISPUTES & CLAIMS:  Any dispute arising under the provisions of the Act, shall be decided by the Employees’ Insurance Court & not by a Civil Court.(sec.74&75)  EIC, constituted by State Government, by notification in Official Gazette, for specified local areas. 5/4/ santhi naryanan


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