LABOUR POLICY
LABOUR policy in India has been evolving in response to the specific needs of the situation in relation to industry and the working class and has to suit the requirements of a planned economy. A body of principles and practices has grown up as a product of joint consulta- tion in which representatives of Government, the working class and employers have been participating at various, levels. The legislation and other measures adopted by Government in this field represent the consensus of opinion of the parties vitally concerned and thus acquire the strength and character of a national policy, operating on a volun- tary basis. Joint committees have been set up to assist in the formu- lation of policies as well as their implementation. At the apex of this tripartite machinery is the Indian Labour Conference.
RECENT DEVELOPMENTS 2. The structure of industrial relations has been designed for the purpose of securing peace in industry and a fair deal for the workers. When the efforts of the parties fail to secure an amicable settlement of industrial disputes, the Government has assumed powers of intervention. Provision has been made for conciliation of disputes and for enabling the State to, refer unresolved differences to tribu- nals set up for the purpose. Stoppages of work after such a reference and any contravention of awards and agreements have been made illegal. This system has helped to check the growth of industrial unrest and has brought for the working class a measure of advance and a sense of security which could not otherwise have been achieved. At the same time, the spirit of litigation grew and, delays attendant on legal processes gave rise to widespread dissatisfaction. In the course of the Second Five Year Plan a new approach was, therefore, introduced to counteract the unhealthy trends and gave a more positive orientation to industrial relations, based on moral rather than legal sanctions. The stress now is on prevention of unrest by timely action at the appropriate stages and giving adequate attention to root causes. This involves a basic change in the attitudes and outlook of the parties and the new set of readjustments in their mutual relations.
3. A Code of Discipline in Industry, which applies both to the public and to the private sector, has been accepted voluntarily by all the Central organisations of employers and workers and has been in operation since the middle of 1958. The Code lays down specific obligations for the management and the workers with the object of promoting constructive cooperation between their representatives at all levels, avoiding stoppages as well as litigation, securing settle- ment of disputes and grievances by mutual negotiations, conciliation and voluntary arbitration, facilitating the free growth of trade unions and eliminating all forms of corcion and violence in industrial relations.
4. The Code provides that a regular grievance procedure be laid down in all undertakings and complaints should receive prompt atten- tion. The legal means of redress and the normal channels should be fully availed of and there should be no direct, arbitrary or unilater- al action on either side. Under the Code, management and workers have agreed to avoid litigation lock-outs, sit-down and stay-in strikes. There will be no recourse to intimidation, victimisation or 'go-slow'. The unions have also agreed not to engage in any form of physical duress and to discourage unfair practices such as negligence of duty, careless operation, damage to property, interference with or disturb- ance to normal work and insubordination. The employers have to allow full freedom to workers in the formation of trade unions) and to abide by the criteria adopted for determining which union has a better claim to recognition. A union guilty of a breach of the Code of Discipline loses its right to such recognition. Both sides are pledged to the scrupulous and prompt implementation of awards, agreements settlements and decisions. Organisations of employers as well as workers Pave bound themselves to express disapproval and take appropriate action against officers, office-bearers and workers who violate the letter or spirit of the Code.
5. It is obvious that a new concept with such far-reaching aims, in a difficult field, requires a considerable period of earnest endeavour before it gets firmly established in practice. The results so far achieved are, however, encouraging both in terms of the reduc- tion of man-days lost owing to stoppages and in bringing about a general improvement in the climate of industrial relations. The number of man-days lost declined steadily and significantly from 47 lakh during January-June 1958, the six months prior to the introduction of the Code, to 19 lakh during July-December, 1960. The Code has also been successful in creating an awareness amongst the employers and workers of their obligations towards each other ; the desire to settle disputes mutually without recourse to the wasteful methods of trial of strength and litigation is steadily growing.
6. The deplorable consequences of inter-union rivalry both for industry and for the workers are well-known. They have been mitigated to
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some extent by the Code of Conduct which was drawn up and accepted by the representatives of workers' organisations three years ago. The Code provides that every employee shall have the freedom and right to join a union of his choice. Ignorance and backwardness of workers shall not be exploited by any Organisation. Casteism, communalism and provincialism shall be eschewed by all unions and there shall be no violence, coercion, intimidation or personal vilification in inter- union dealings. It is enjoined that there shall be unreserved accept- ance of and respect for democratic functioning of trade unions and all Central organisations shall combat the formation and continuance of company unions.
7. The failure to implement awards and agreements has been a common complaint on both sides and if this were to continue, the Codes would be bereft of all meaning and purpose. A machinery for implemen- tation and evaluation has, therefore, been set up at the Centre and in the States to ensure observance by the parties of the obligations arising from the Codes and from laws and agreements.
8. Two lines of advance during the period of the Second Plan deserve special mention because of their great significance as ele- ments of labour policy and for the reason of the great promise they hold for the future. In the first place to give the workers a sense of belonging and to stimulate their interest in higher productivity, a form of workers' participation in management was evolved during the Second Plan. A small beginning was made in this direction on an experimental basis and Joint Management Councils have been set up so far in 23 units. The Council has the right to obtain information regarding the working of the undertaking and has direct administrative responsibility for matters concerning workers' welfare, training and allied matters. Its main function is to bring about mutual consulta- tion between employers and workers over many important issues which affect industrial relations. In a seminar held in March, 1960, repre- sentatives of employers, workers, State Governments and others con- cerned reviewed their experience of the working of the Joint Councils and the solutions they had evoked for specific problems. Keeping in view the short duration of the experiment, its results have been found to be satisfactory and heartening. Secondly, after completion of the preparatory stage, the programme of workers' education has made a good start and is being widely appreciated. The scheme comprises the training of teacher-administrators and worker-teachers. The latter, on returning to their establishments on the completion of their train- ing, start unit-level classes for the rank and file of the workers. According to an independent appraisal of the working of this scheme, these courses have helped to raise the self-confidence of the workers, increased their ability to take advantage of protective labour laws, reduced their dependence upon outsiders and inculcated in them an urge for material and economic welfare. A beginning was made in sponsoring investigations on labour problems through independent research insti- tutions with Government support.
APPROACH AND OUTLOOK 9. The coming years should witness the fuller impact of the ideas which have been tried and found useful during the Second Plan period. The Third Five Year Plan has to make its own contribution towards the evolution of labour policy and the realisation of Its basic aims. It has always to be kept in view that the measures that are adopted must serve adequately the immediate and long-term ends of planned economic development. Economic progress has to be rapid enough to attain a level of full employment, and secure a rising standard of living for the people. The fruits of progress should be shared in an equitable manner and the economic and social Organisation which is being created must be in keeping with the concept of a so- cialist society. In the implementation of these objectives the work- ing class has an important role and a great responsibility, and these will grow with the rising tempo of industrialisation, The large expan- sion of the public sector which is occurring and is being envisaged will make a qualitative difference in the tasks set for the labour movement and will facilitate the transformation of the social struc- ture on the lines of the socialist pattern in view. The implications of this approach are manifold. Economic activity has not to be con- ceived of solely in terms of output and return ; the principal test of this would be the good of all those who are engaged in it. the quality and growth of the individual human being and the service and happiness of the entire community. The surpluses that are generated are a social product, to which neither the employer nor the working class can lay an exclusive claim ; their distribution has to be according to the worth of the contribution of each, subject to the requirements of further development and the interests of all the sections of socie- ty, in particular the satisfaction of the basic needs of all its members. While jobs and functions may vary, all are workers of dif- ferent grades. Those of the lowest rank and their children should be fortified in the faith that they are free to equip themselves to be able to rise to the highest Positions and that the worker and manage- ment are joined in partnership to strive for common ends. Thus, a new type of community is being created in which individuals and groups are moved more by a sense of mutual obligations than the spirit of acquis- itiveness or the making of private gains at the expense of the general well-being.
INDUSTRIAL RELATION 10. The development of industrial relations in the Third Five Year Plan rests on the foundations created by the working of the Code of
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Discipline which has stood the strain of the test during the last three years. A full awareness of the obligations under the Code of Discipline has to extend to all the constituents of the Central organ- isations of employers and workers, and it has to become more and more a living force in the day-to-day conduct of industrial relations. The sanctions on which the Code is based have to be reinforced, relying on the consent of the parties, for this purpose.
11. Ways will be found for increasing the application of the principal of voluntary arbitration in resolving differences between workers and employers. Steps will be taken to remove certain hin- drances in the way of a fuller recourse to voluntary arbitration. The same protection should be extended to proceedings in this case, as is now applicable to compulsory adjudication. Government should take the initiative in drawing up panels of arbitrators on a regional and industry-wise basis. Employers should show much greater readiness to submit disputes to arbitration than they have done hitherto. This has to be the normal practice, in preference to a recourse to adjudica- tion, as an important obligation accepted by the parties under the Code.
12. The law provides for the establishment of Works Committees at the plant level in order to develop harmonious relations between employers and workers. According to a recent assessment, the system has proved its capacity to render substantial help in composing dif- ferences between the parties though, owing to lack of earnest effort, the Committees are not functioning effectively in some units. The decision to demarcate the functions of Works Committees, as distinct from those of trade unions. will remove an obstacle in the way of the successful functioning of the Committees. It is, thus. essential that Works Committees are strengthened and made an active agency for the democratic administration of labour matters.
13. Joint Management Councils.-A major programme for the period of the Third Five Year Plan will be the progressive extension of the scheme of Joint Management Councils to new industries and units so that, in the course of a few years. it may become a. normal feature of the industrial system. As it develops, workers' participation may become a highly significant step in the adaptation of the private sector to fit into the framework of a socialist order. It can serve to bridge the gulf between labour and management. create better mutual understanding and facilitate the adoption, on both sides. of an objec- tive approach towards the problems of industry and the workers. The success or failure of an undertaking is not the concern of management alone. For the peaceful evolution of the economic system on a demo- cratic basis, it is essential that workers' participation in manage- ment should be accepted as a fundamental principle and an urgent need, In course of time, management cadres should arise out of the working class itself. This will greatly help to promote social mobility which is an important ingredient of a socialist system.
14. Joint Management Council should be set-up in all establish- ments in the public as well as the private sector in which conditions favourable to the success of the scheme exist. A primary test of eligibility is the presence of goodwill on both the sides. Wherever a representative union exists, a Council should come into being as a matter of course. An intensive programme of workers' education will be undertaken in all the establishments where such Councils are set up.
15. Workers' education.-The programme of workers' education which Government has undertaken through a semi-autonomous Board is being run with the cooperation of all the employers' and workers' organisations. A largescale expansion of this scheme is visualised for the period of the Third Plan. It is intended to diversify the programme and secure fuller association of workers' representatives and their organisations. The complementary question of management training in labour matters is also receiving consideration.
16. The spread of literacy among the workers is an indispensable precondition for the success of the various programmes that are being undertaken. The benefit of literacy should be made available to as large a number of workers as possible in the next few years, particu- larly to those below the age of forty.
17. Trade unions.-There is need for a considerable re-adaptation in the outlook functions and practices of trade unions to suit the conditions which have arisen and are emerging. They have to be ac- cepted as an essential part of the apparatus of industrial and econom- ic administration of the country and should be prepared for the dis- charge of the responsibilities which attach to this position. Trade union leadership has to grow progressively out of the ranks of the workers. and this process will be greatly accelerated as the programme of workers' education gathers momentum. At present, the trade unions are in most cases labouring under the handicap of insufficient re- sources and are not in a position to obtain all the help and guidance that they need.
18. The basis for recognition of unions. adopted as a part of the Code of Discipline, will nave the way for the growth, of a strong and healthy trade unionism in the country. A union can claim recogni- tion, if it has a continuing membership of at least 15 percent of the workers in the establishment over a period of six months and will be entitled to be recognised as a representative union for an industry or a local area. if it has membership of at least 25 per cent of workers. Where, there are several unions in an industry or establishment. the union with the largest membership will be recognised. Once
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a union has been recognised, there should be no change in its position r a period of two years, if it has been adhering to the provisions of the Code of Discipline.
19. The personnel of the industrial relations machinery calls for greater attention in respect of selection as well as training. It is necessary to ensure that the quality and equipment of conciliators and tribunals are adequate for the complex tasks which now confront them . It is proposed to institute a suitable training programme for this purpose.
WAGES AND SOCIAL SECURITY 20. The Government has assumed responsibility for securing a minimum wage for certain sections of workers, in industry and agricul- ture, who are economically weak and stand in need of protection. Towards this end the Minimum Wages Act provides for the fixation and revision of wage rates in these occupations. These measures have not proved effective in many cases. For better implementation of the law, the machinery for inspection has to be strengthened. Wage determina- tion in major industries is left to the process of collective bargain- ing, conciliation, arbitration and adjudication. The Second Plan recommended the setting up of Wage Boards as the most suitable method of settling wage disputes where large areas of industry are concerned. This has so far been applied to the cotton and jute textiles, cement, sugar and plantation industries; and will be extended to other indus- tries according to circumstances. It has been decided to appoint a Board soon for the iron and steel industry. The representatives of employers and workers have agreed that unanimous recommendations of a wage board should be implemented fully. An encouraging trend has been noticed in the coal mining industry where employers and workers have agreed to set up a bipartite committee to examine the entire question of wage revision in the industry; alternative wage-fixing machinery will be considered only if the bipartite committee fails to arrive at a settlement.
21. Some broad principles of wage determination have been laid down in the Report of the Fair Wages Committee. On the basis of agreement between the parties, the Indian Labour Conference had indicated the content of the need-based minimum wage for guidance in the settlement of wage disputes. This has been reviewed and it has been agreed that the nutritional requirements of a working class family may be re-examined in the light of the most authoritative scientific data on the subject. Apart from the minimum wage, care should be taken in fixing fair wages for different classes of workers, that adequate incentives are provided for the acquisition and develop- ment of skills and for improvements in output and quality. There are, however, wide disparities between the wages of the working class, on the one hand, and the salaries at the higher management levels, on the other.
22. Owing to the uncertainty attaching to it, the question of bonus has become a source of friction and dispute. It has been decid- ed to appoint a Commission which will include representatives of both parties to study the problems connected with bonus claims and to evolve guiding principles and norms for the payment of bonus.