HRM Employee Participation Prof R K Singh AIMA CME

Employee Participation “The participation resulting from practices which increases the scope for employee’s share of influence in decision making at different tiers of organizational hierarchy with concomitant assumption of responsibility.” -The International Institute of Labour Studies.

Implications of Workers’ Participation 1.Workers have ideas which can be useful 2.Upward Communication facilitates sound decision making. Workers may accept decisions better if they participate in them. 3.Workers may work more intelligently if they are informed about the reasons for and the intention of decisions that are taken in a participative atmosphere.

Implications of Workers’ Participation 4.Workers may work harder if they share in decisions that affect them. 5.Workers participation may foster a more co- operative attitude amongst workers and management thus raising efficiency by improving team spirit and reducing the loss of efficiency arising from industrial disputes 6.Workers participation may act as a spur to managerial efficiency. - International Labour Organization.

5 Interpretation of Participations 1.Informative Participation: Sharing of information with workers regarding, Economic position of the firm State of the market Production & Sales programme Work Methods Balance Sheet Expansion Plans The workers have no right to scrutinize the information provided by Management.

5 Interpretation of Participations 2Consultative Participation: This involves a higher degree of sharing of views of the workers and giving them a chance to express their views on various issues concerning Work, Workplace, Working Conditions, Market Standing, Financial Status etc. Here, the joint council of workers and Management works as an advisory body only. Management may or may not accept the suggestions.

5 Interpretation of Participations 3.Associative Participation: Here the council is not purely advisory. The Management is under a moral obligation to accept and implement the unanimous decisions of the council. 4.Administrative Participation: Here there are a greater degree of sharing authority and responsibility of managerial work and allows workers a little more autonomy in exercising administrative and supervisory powers in respect of welfare, safety, benefits, rewards, etc

5 Interpretation of Participations 5.Decisive Participation: This is the highest form of participation where decisions are taken jointly on matters relating to production, safety, welfare, etc.

Works Committees : 1947 “The Industrial Disputes Act, 1947”provides for the setting up of Bipartite Works Committees as a scheme of workers participation in management which consist of representatives of employers and employees. The aim is to promote measures for maintaing harmonious relations in the work place and to sort out differences of opinion on work related issues. E.g. Work Condition and Benefits.

Structure of Works Committee President : Employer Nominee Vice-president: Workers’ Representative Secretary Joint Secretary Tenure: 2 Years Total Strength : 20 Examples: TISCO, Indian Aluminium Works at Belur, Hindustan Lever. Compulsory for every undertaking employing 100 or more workers.

10 Joint Management Councils (JMCs) 1958, 2 nd Five Yr Plan) Objectives: 1. To increase the association of employers and employees by promoting cordial industrial relations 2. To improve the operational efficiency of the workers 3. To provide welfare facilities 4. To educate workers so that they are well prepared to participate in these schemes and 5. To satisfy the psychological needs of workers

1112 Functions of JMCs 1. To be consulted on matters like, -Standing Orders, -Retrenchment,Closure, -Reduction of Operations etc. 2. To receive information, to discuss and offer suggestions 3. To shoulder administrative responsibilities like maintaining Welfare Measures, Safety Measures, Training Schemes, Working Hours, Payment of Rewards

12 Worker Director (1970) Following the recommendations of Administrative Reforms Committee the Government has accepted that representatives of workers be taken on the Board of Directors of Public Sector Undertakings. It was introduced in Hindustan Antibiotics Ltd., Hindustan Organic Chemicals Ltd., National Coal Mines Development Corporation, BHEL etc.

13 Shop & Joint Councils (1975 & 77) This envisaged the setting up of, - Shop Councils at the Shop/Departmental level and - Joint Councils at the enterprise level. These were to be introduced in manufacturing and mining units employing 500 or more workers-whether in public, private or co-operative sector.

14 The New Scheme (1984) A new scheme of Workers’ Participation in management was prepared and notified in 1984 after reviewing the progress of various schemes in industry. 1. Its applicable to all central Public Sector Enterprises 2. It was decided to allow workers to participate at the Shop level, the Plant level, and the Board level. 3. The mode of representation of Workers’ Representatives was to be determined by consultations with Union/s.

15 The New Scheme (1984) 4. A wide range of work related issues (Personnel, Welfare, Plant Management, Operations, Financial Matters, etc.) were brought within the ambit of the Councils. 5. The Ministry of Labour constituted a Tripartite Committee to review the working of the scheme and to suggest corrective measure.

16 The 1990 Bill The existing non-statutory schemes of Workers’ Participation have failed to give meaningful participation to workers at the enterprise level. To remedy the situation the Government introduced a Bill in the parliament on 25 th May, 1990 to, 1. Offer Meaningful Three-tier participation to workers in Management at three levels, -Shop Floor -Enterprise and -Board Level

17 The 1990 Bill 2. The proportionate share of worker representatives and the persons representing other workers in the Board of Management in every undertaking is put as 13% and 12% respectively. 3.Formulate schemes specifying detailed criteria regarding nomination of representatives from workers, the power of Shop Floor Councils and Establishment Council have also been extended to cover a wide range of Production, Operational, Economic, Financial, Personnel, Welfare and Environmental issues.

18 The 1990 Bill 4. Provide for the principle of secret ballot for choosing representatives of workers 5. Provide for rules for monitoring the program 6. Extend the coverage of the scheme to all corporate establishments.