LABOUR POLICY AND PROGRAMMES
INTRODUCTION THE FIRST FIVE YEAR PLAN was drawn up in the context of a growing consciousness of the importance of industrial labour in the national economy. With the advent of Independence, certain assurances were given to a labour in recognition of its rights which had long been neglected. An attempt was made in the first plan to give concrete shape to these assurances and to give labour a fair deal consistent with the requirements of other sectors of the economy.
2. Judged by improvements recorded in industrial relations for which both employers and workers can take credit the success of joint consultation at various levels and increase in real earnings of workers over the last five years, the plan in the labour field should be considered to have recorded progress. The desire shown by employers and workers to come together and settle their problems in industrial committees set up by Government has of late become a welcome feature of labour relations. In fact much of the legislation in the last five years has been agreed to, in its broad outline, by the parties concerned in tripartite committees. Though questions like bonus and profit sharing still require a satisfactory solution, recent agreements at some centres mark an encouraging advance. Progress has also been made in the implementation of the social security measures provided under the Employees' State Insurance Act 1948, and the Employees' Provident Funds Act, 1952. A further measure of security in case of loss of employment has been provided in the shape of the Industrial Disputes (Amendment) Act, 1953. Simultancously, Industrial Tribunals are taking due note of the need for security in framing awards on issues like provident fund, gratuity, etc. The importance of better working conditions has also be-en progressively recognised. In order to study systematically the problems of production in relation to health and safety of workers, a Central Labour Institute has been planned and productivity studies in certain industries have been promoted. State Governments have opened welfare centres and the last five years have seen an intensification of efforts at improved housing for industrial workers. Though admittedly much remains to be done, especially in matters like covering the distance between the existing wage and 'fair-wage' and in industrial housing progress can only be gradual. With the implementation of the Plantation Labour Act, some improvement will be recorded in the conditions of plantation labour.
3. Much of what has been said in regard to labour policy in the first live year plan holds good as a basis for the future. However, in the light of the socialist pattern of society, within which setting the second five year plan has been framed, suitable alterations in labour policy require to be made. A socialist society is built up not solely on monetary incentives, but on ideas of service to society and the willingness on the part of the latter to recognise such service. It is necessary in this context that the worker should be made to feel that in his own way he is helping to build a progressive State. The creation of industrial democracy, therefore, is a pre-requisite for the establishment of a socialist society.
4. Expansion of the public sector envisages an incresingly greater responsibility for workers as well as management in that sector. Also, if conditions of work, in public undertakings are expected to set the pace for the private sector, administrators handling such undertakings have to be specially watchful of labour interests. Whether it is the public sector or the private sector the goal of progressively speeding up production would mean that indiscipline, stoppage of production and indifferent quality of work will have to be guarded against, and the labour policy has to be directed towards this end. Since such a policy must have the support of not only important employers' and workers' interests, but also of the public, the Planning Commission constituted a representative Panel on Labour and sought its advice in the matter. The recommendations made in the second five year plan have emerged in the main from agreement among members of the Panel.
TRADE UNIONS 5. A strong trade union movement is necessary both for safe- guarding the interests of labour and for realising the targets of production. Multiplicity of trade unions, political rivalries, lack of resources and disunity in the ranks of workers are some of the major weaknesses in a number of existing unions. It is often suggested that dependence of unions on outsiders as
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their executives is one of the many causes of unhealthy rivalries in the labour movement. While this suggestion is not entirely without foundation, it must be recognised that outsiders have played a notable part in building up the trade union movement in the country. But for their association, the movement would not have reached even its present dimensions and strength. A distinction needs to be drawn here between outsiders who are whole-time trade union workers and those who look upon union work only as a part of their other activities. There. is still need for devoted workers of the first kind in the. trade union organisations and the right of trade unions to elect such persons to their executives, if they so choose, should not be interfered with. Even so, the unions need to realise that undue dependence on any one not belonging to the ranks of industrial workers must necessarily affect the capacity of workers to organise themselves. It is interesting to note, however, that recently the number of outsiders managing the trade unions has shown a decline. This trend deserves to be encouraged.
6. Reduction in the number of outsiders as office bearers of trade unions is likely to create a gap in the, field of executive personnel for trade union organisation. Training of workers in trade union philosophy and methods becomes necessary if the workers are to become self-reliant in this respect. The programmes under labour welfare include a stipendiary scheme for this purpose.
7, Another step in building up strong unions is to grant them recognition as representative unions under certain conditions. In some States, the industrial relations code provides for recognition when a union's claim of sufficient paying membership is expressed as a percentage of union members-to the total number of workers the union claims to represent. The percentage entitling recognition may differ from State to State according to the stage of development of the trade union organisation. Since recognition has played a notable part in strengthening the movement in some States, it is suggested that some statutory provision. for securing recognition of unions should be made by States, where such provision does not exist at present In doing so the importance of one union for an industry in a local area requires to be kept in view. It is equally important that while mere numbers would secure recognition to a union, it should, for functioning effectively, exhaust the accepted procedure and the machinery for the settlement of disputes before it has recourse to direct action.
8. Improving the finances of trade unions from their internal resources is another important aspect of strengthening the movement. In their desire to build up membership of as large a magnitude as possible, unions fix their membership fees at extremely low rates and fail to collect even these. Regular payment of union dues on the part of workers, and termination of membership by unions of those falling in arrears of dues are both uncommon. It is felt that. a membership fee of at least four annas a month be prescribed in the rules of a trade union as a condition precedent if it desires registration as a recognised union. It is equally necessary that there should be stricter enforcement of rules regarding payment of arrears.
EMPLOYERS' ORGANISATIONS 9. In the interests of industry-wide bargaining in area, provision should be made for the certification of employers' associations as representatives of industry in an area. Any agreement entered into by such associations would then be binding on all members of the associations as well as on non-members.
INDUSTRIAL RELATIONS 10. For the development of an undertaking or an industry, industrial peace is indispensable. Obviously this can best be achieved by The parties themselves. Labour legislation and the enforcement machinery set up for its implementation can only provide a suitable framework in which employers and workers can function. The best solution to common problems, however, can be found by mutual agreement. Recently there have been some healthy developments in this direction, and agreements have been reached on a number of' seriously disputed issues. An agreement was signed in June, 1955 between the Ahmedabad Mill Owners' Association and the Textile Labour Association regarding the question of bonus. The two associations have also decided that all their future disputes should be settled by mutual negotiations and discussion and without recourse to strikes or to courts. Voluntary arbitration has also been provided for as a last resort in case the parties fail to settle their differences. A bonus agreement Was signed early in 1956 by the Bombay Mill Owners' Association and the Rashtriya Mill Mazdoor Sangh, Bombay. An important agreement was also reached between the Tata Iron & Steel Co. Ltd, Jamshedpur and the union representing their workers. This agreement is noteworthy for several reasons. For instance, for the first time in such an agreement there are provisions for union security and workers' co-operation in measures for higher productivity, for modernisation and expansion, and for acceptance of schemes for job evaluation. The employers have also recognised the desirability of an increasing measure of association of employees in the management of the industry. These agreements by themselves cover only a small section of the total industrial labour in the country, but their influence in paving the way for better industrial relations in the country cannot be underestimated.
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11. In an industrial civilization work stoppages receive an undue share of publicity, magnifying the popular impression of industrial unrest. To counteract the results of such publicity it is necessary to undertake studies in factors which have made for industrial harmony in establishments with a long tradition of peaceful working. In this connection studies are in progress in some establishments in the country; While these studies should publicize the constructive aspects of labour relations, it is also necessary to supplement them by studies in areas where there are frequent industrial disputes in order to present the contrasting situations from which parties can draw their own inferences.
12. The importance of preventive, measures for achieving indus- trial peace needs to be stressed. Greater emphasis should be placed on avoidance of disputes at all levels, including the last stage of mutual negotiations, namely conciliation. In countries where the conciliation machinery has worked more successfully than in India, efforts are made by the conciliator to keep in touch with trade union leaders and employers even when there are no disputes, and to discuss matters which are likely to cause conflict in future. Such discussions have considerable value in avoiding disputes and should be introduced in this country,
13. Once disputes arise, recourse should be had to mutual negotiations and to voluntary arbitration. The machinery for facilitating these stages should be built up by the Central and the State Governments. Government should maintain lists of persons in whom employers and workers have confidence. In case of need the parties should be encouraged to select by mutual consent names of persons from such lists who could act as arbitrators. However, in intractable cases. where these methods fail, recourse to Government intervention would be unavoidable. The machinery for settlement of disputes, as obtaining in 1950. was too cumbersome. The proposed amendment of the Industrial Disputes Act aiming at (a) simplifying the procedure for adjudication. (b) abolishing the Labour Appellate Tribunal, and (c) removing difficulties experienced by parties in administering Section 33 of the Industrial Disputes. Act, consistent with the production of the legitimate interests of workers, is a step in, the right direction.
14. One of the sources of friction between labour and management is inadequate implementation and enforcement of awards and agreements. In some cases the awards have not been implemented even in the face of Government's insistence on their implementation. There is no provision for enforcing compliance with the directions contained in awards, other than those involving financial recoveries, such as reinstatement of an employee or the provision of an amenity. The only remedy against the employer in such cases is to prosecute him under the Industrial Disputes Act, 1947, but this remedy is ineffective as the maximum punishment is only Rs. 200/- for a first offence and Rs. 500 for subsequent ones. Experience has shown that this is not a sufficient sanction for employers to carry out directives which might involve large expenditures. It is necessary, therefore, that the penalties should be sufficiently deterrent. Penalties for workers in case of deliberate violation should also be of a deterrent nature.
15. While the responsibility for implementation should be mainly on the employer (public or private), an appropriate tribunal should be constituted for enforcing compliance. It should be possible for the parties to have direct approach to this tribunal. The tribunal should also be empowered to interpret the scope and meaning of the directives contained in awards. In respect of findings which are not enforceable in financial terms the tribunal should have the power to require Government or some designated executive authority to secure specific performance within a given period.
16. A standing joint consultative machinery, could effectively reduce the extent of industrial unrest. It is necessary to have such machinery at all levels, at the Centre, in States and in individual units. Cooperation between labour and management becomes more effective if there is a two-way traffic between the bipartite consultative machinery at the top and the machinery performing similar functions at the unit level. Works committees could function in the units in this capacity. These committees should, in addition to giving effect to agreements reached at higher levels, pose practical problems in working out such agreements, so that these can be settled through the consultative machinery suggested earlier. Experience has shown that a major hindrance in the way of effective functioning of works committees is the lack of a clear-cut demarcation between their responsibilities, and the responsibilities of trade unions operating in the field. The representative union should have the sole right of taking up with management matters or disputes in connection with wages, allowances and other terms and conditions of service or matters which are appropriate for mutual discussions. Questions relating to the technical and human problems of an enterprise and the best and most equitable means of achieving objectives of common interest to the undertaking could perhaps be more effectively handled by works committees. This might make for better working of both. In the case of larger units it might be necessary to have similar arrangements at the shop level. If the parties agree, works committees could also be entrusted with the responsibility of proper application, interpretation and supervision of collective agreements or awards and of
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standing orders. However, it should be open to a union in appropriate cases to demand at any stage of the discussion in the works committees that a particular matter should be remitted for settlement between the union and the employer.
17. The existing bipartite joint consultative machinery, namely, the Joint consultative Board could be more effectively utilised. The Board has already achieved a limited measure of success. Though its specific achievements have not been spectacular, it has produced a climate in support of the system of mutual consultation and negotiations. Its utility and importance will in future rest largely upon its ability to solve contentious matters through mutual discussions. The Board proposes to intensify its activities by getting important problems studied, meeting more frequently and discussing problems with the intention of arriving at settlements in the spirit of give and take. It is hoped that this would pave the way for fruitful co-operation at all levels.
18. For the successful implementation of the plan increased association of labour with management is necessary. Such a measure would help in (a) promoting increased productivity for the general benefit of the enterprise, the employees and the community, (b) giving employees a better understanding of their role in the working of industry and of the process of production and (c) satisfying the worker's urge for self expression, thus leading to industrial peace, better relations and increased co-operation. This could be achieved by providing for councils of management consisting of representatives of management technicians and workers. It should be the responsibility of the management to supply such a council of management fair and correct statement of all relevant information which would enable the council to function effectively. A council of management should be entitled to discuss various matters pertaining to the establishment and to recommend steps for its better working. Matters which fall within the purview of collective bargaining should, however, be excluded from the scope of discussion in the council. To begin with the proposal should be tried out in large establishments in organised industries. The pace of advance should be regulated and any extension of the scheme should be in the light of the experience gained.
19. In view of the fact that the public sector will grow in future, the manner of administration of industrial relations in public enterprises is of great importance for the success of the undertaking and for the fulfilment of the aspirations of labour. Any attempt, therefore, on the part of public employer to avoid the responsibility of an employer on the ground that he is not working for profit has to be discouraged. Managements of public undertakings should not normally seek exemptions from labour laws or ask for other concessions not available to the private sector. This is not to suggest that public undertakings, as a rule, come forward to seek exemptions from laws relating to labour or to imply that working conditions there are not satisfactory. In fact in almost all the new State enterprises considerable attention has been paid to labour welfare in the comprehensive sense. In the last analysis employees in the public sector should on the whole be at least on par with their counterparts in private employment and should feel a legitimate pride in what they produce and in their position as employees in the public sector,