EXECUTIVE SUMMARY

EXECUTIVE SUMMARY
The industrial relations are the relationship between employees and employers within the organization. In industrial relation performance appraisal is very necessary to understand the employees rates in term of their performance. It also help the employees to understand their rules and responsibilities. The industrial relations system in India has been under pressure for decades and new problems are emerging as the country becomes more integrated into the global economy. The main architecture of the system was established prior to Independence and remains mostly unchanged. The system is highly centralized and the state is the main mediator between capital and labour. Unions have historically enjoyed a close relationship with the state through partybased federations, but this has undermined their success developing a robust grassroots constituency and experience in collective bargaining. This report provides a broad overview of the evolution of the Indian system of industrial relations and the labour market reform debate that has arisen in the context of economic change in Nahar Spinning Mills Ltd., Ludhiana. The structure of the Indian labour market, the overwhelming size of the informal or `unorganized' workforce, and its location outside the industrial system is the fundamental challenge facing Indian industrial relations. There is an urgent need to develop a system that embraces all workers especially given India's demographic profile and the expected increase in the number of working age people over the next decade. The experience of women workers and the failure of both the industrial system and the union movement to understand and accommodate their needs is also an important challenge for industrial relations in India. Present research is to study the performance of an employee in relation to industrial relations at Nahar Spinning Mills Ltd., Ludhiana.

CHAPTER 1: INTRODUCTION

CHAPTER 1: INTRODUCTION
The relationship between Employer and employee or trade unions is called Industrial Relation. Harmonious relationship is necessary for both employers and employees to safeguard the interests of the both the parties of the production. In order to maintain good relationship with the employees, the main functions of every organization should avoid any dispute with them or settle it as early as possible so as to ensure industrial peace and higher productivity. Personnel management is mainly concerned with the human relation in industry because the main theme of personnel management is to get the work done by the human power and it fails in its objectives if good industrial relation is maintained. In other words good Industrial Relation means industrial peace which is necessary for better and higher productions.1 Definition:i. Industrial Relation is that part of management which is concerned with the manpower of the enterprise whether machine operator, skilled worker or manager. BETHEL, SMITH & GROUP ii. Industrial Relation is a relation between employer and employees, employees and employees and employees and trade unions. - Industrial dispute Act 1947 iii. While moving from jungle of the definitions, here, Industrial Relation is viewed as the process by which people and their organizations interact at the place of work to establish the terms and conditions of employment. The Industrial Relation relations also called as labor - management, employee-employers relations. A few notable features pertaining to Industrial Relations are as under: 1. Industrial Relation do not emerge in vacuum they are born of employment relationship in an industrial setting. Without the existence of the two parties, i.e. labor and management, this relationship cannot exist. It is the industry, which provides the environment for industrial relations. 2. Industrial Relation are characterized by both conflict and co-operations. This is the basis of adverse relationship. So the focus of Industrial Relations in on the study of the attitudes,
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relationships, practices and procedure developed by the contending parties to resolve or at least minimize conflicts. 3. As the labor and management do not operate in isolations but are parts of large system, so the study of Industrial Relation also includes vital environment issues like technology of the workplace, countrys socio-economic and political environment, nations labor policy, attitude of trade unions workers and employers. 4. Industrial Relation also involve the study of conditions conductive to the labor, managements co-operations as well as the practices and procedures required to elicit the desired co-operation from both the parties. 5. Industrial Relations also study the laws, rules regulations agreements, awards of courts, customs and traditions, as well as policy framework laid down by the governments for eliciting co-operations between labor and management. Besides this, it makes an in-depth analysis of the interference patterns of the executive and judiciary in the regulations of labormanagements relations. In fact the concepts of Industrial Relations are very broad-based, drawing heavily from a variety of discipline like social sciences, humanities, behavioral sciences, laws etc. In fact, Industrial Relation encompasses all such factors that influence behavior of people at work. A few such important factors are details below: 1. Institution: It includes government, employers, trade unions, unions federations or associations, government bodies, labor courts, tribunals and other organizations which have direct or indirect impact on the industrial relations systems. 2. Characters : It aims to study the role of workers unions and employers federations officials, shop stewards, industrial relations officers/ manager, mediator/conciliators / arbitrator, judges of labor court, tribunal etc. 3. Methods : Focus on collective bargaining, workers participation in the Industrial Relation schemes, discipline procedure, grievance re-dressal machinery, dispute settlements machinery working of closed shops, union reorganization, organizations of protests through methods like revisions of existing rules, regulations, policies, procedures, hearing of labor courts, tribunals etc. 4. Contents : Includes matter pertaining to employment conditions like pay, hours of works, leave with wages, health, and safety disciplinary actions, lay-off, dismissals retirements etc., laws relating to such activities, regulations governing labor welfare, social security, industrial relations,
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issues concerning with workers participation in management, collective bargaining, etc.

1.1 INDUSTRIAL RELATIONS

It is seen as a co operation between employer and employee, it is done with discipline (ii) done in organized manner and not casual and it gives satisfaction of needs. Industrial Dispute : As per section 2 (K) of industrial dispute or difference between employers and employees employers and employers or employees and employees which is connected with the employment or non employment or the terms of employment or with the condition of labour of any person. 1) There must be a dispute or difference the dispute or difference must be between employers and employees employee and employees, employers and employers. 2) The dispute must be connected with employment or non employment or terms of employment or with the conditions of labour of any person. General causes of industrial disputes strains which results in bad industrial relations are. 1. Close mindedness of employers and employees one thinking to extract maximum work with minimum remuneration, other thinking to avoid work and get more enhancement in pay and wages. 2. Irrational wage, wage system and structure not mutually acceptable 3. Poor working environment, low presence of safety, hygiene conditions vitiated atmosphere for smooth working 4. Poor human relations, and lack of dexterity on the part of management personnel 5. Lack of control over the situations erosion of discipline, which rebounds. 6. Introduction of new technology or automation mechanization, Computerization etc. without proper consultations, preparations and discussion with workers and creating climate. 7. Nepotism, unequal work loads, disproportionate wage, and responsibilities. 8. Adoption of unfair labour practices either by employer or employees and unions. 9. Unjustifiable profit sharing, and not considering workers as a co-shares of the gains of the industry. 10. Frequent union rivalries over membership foisting up of fake unions. 11. Strikes lock out, lay off, and resulting retrenchment due to high handedness on the part of the concerned.
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12. Throwing away the agreements and arrived settlements 13. Militancy of the unions 14. Attitude of government and political parties who may indirectly control some the unions for their own gains or to get a hold on the industry. Few suggestions for the improvement of industrial relations and reduce disputes 1. Trade unions should be strengthened democratically so that they can understand and toe with the main stream of the national industrial activities. They can drop the some how survive attitude by promising impossibles and consequent perpetual strain. 2. Employers should have more transparency in their dealings with workers to build confidence and have progressive out look. 3. They should have open minded flexible collective Bargaining. 4. Workers should be allowed to participate in the management through forums, committees and councils, 5. Sound labour policy, planning 6. Proper leadership and communication 7. Enforcement of discipline 8. Try to have union with in workers fold. 9. Equity in distribution of wealth by acknowledging workers as team members This has always remained as a disputable topic whether industrial relations is same as personal relation, human relation or labour management employer employee or union and management relations. A discussion on industrial relation considers all these as almost same. Bad Industrial Relations leads to industrial unrest industrial dispute and a downward trend to industries workers and the nation. Of course the first hit will be on the employers, who has invested. Industrial worker and the employers normally dont think, feel or act in precisely the same way and because each starts from a different point conflict of some fort can mover be eliminated completely. The main reasons for industrial discard, can be due to 1. Misunderstanding or differences in perception
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2. Lack of co operation real or imagined 3. Problems with authority 4. Future to comply with policies or stick to plans. 5. His Agreements over ways to achieve agreed goals. Conflict can have some positive aspects also, they may give positive results like 1. Reveal new aspect of an existing issue 2. Improve long term communication between the individuals concerned 3. Always previously stifled emotions to be released

1.2

CONCEPT

AND

DETERMINANTS

OF

INDUSTRIAL

RELATIONS AND ITS POSITION IN INDIA

It is concerned with the relationships between management and workers and the role of regulatory machanism in resolving any industrial dispute. The relation between workers and management have undergone Himalayan changes in our country there had been a system of king and his subjects, all should work to improve the coffers of the king. Later Zamindars came and workers were at their mercy some time bonded also, later with the formation of East India company and British Rule a heart less Hire and fire system was established Industrial workers were no mans child neither the employers nor government cared for them, there were no union also. Gradually enlightened leaders came in like, Gokale, MK Gandhi Roy, Tilak etc felt the need for workers union. Their relentless efforts forced both governments and the employers to think of workers lot small unions were formed, government enacted rules like Trade union Act 1926. Industrial disputes Act etc. The workers began to realise their status and they were awakened. A sort of uprighting workers and reluctant management has started functioning. Soon workers motivated by different Industrial Acts enacted by parliament supporting them, and looking after their health, welfare, safety, social security etc. Got emboldened to raise their voice. At the same time management also has started improving, more and more industries were nationalised, public sector came in to existence at number of places, textile insurance, banks transport etc.
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With increasing number of public sectors, workers life style changed, assured job arrogated unions, appeasing management, administration with less account ability workers had their field day. Public sectors started doing more of social service than business and profit doling out public exchequer. Slowly this trend is changing with the governments reversal policy, decentralization Privatisation etc. Compelled by universal need to compete in business, activated by world. Trade organisation global economy etc government turned towards foreign investments and industrial set ups by foreign investors. Stringency of some of the laws are disappearing monopolies Restrictive Trade Practice, F.E.R.A etc consequently issues like productivity linking productivity with emoluments are also coming into fore front. With new companies coming in, formation of merry unions have come to a stand still, no union worth the name is there in 1.T sector in our Tradial Park, Chips World etc. Job security is diminishing, legislations, are not coming as before because we have to live in a competitive world, of industries where down sizing out sourcing productivity, etc has become the watch word. From the words of TISCO management. The welfare of the labouring classes must be one of the first cares of every employer, Any betterment of their conditions must proceed more from the employers downwards rather than be forced up by demands from below since labour, contented, well housed, well fed and generally well looked after, is not only an asset and advantages to the employer but serves to raise the standard of industry and labour in the country It is sheer injustice on the part of any management to take advantage of the poor, helpless conditions of workers and exploit them with more work extractions and less insufficient payment. Workers illiteracy and lack and training made them to work in unhealthy conditions for very low compensation. At this Juncture industrial relations need was felt to protect workers rights, wages etc. At the same time industrial relations cannot remain producing the rights of one side only in the industry they have to protect the rights of employers also. As such 1R has declared through act, what are illegal strikes and various standing orders to protect the dignity of supervisors, managers and of course employers. The main concept of industrial relations are 1. preservation and promotion of economic interest of workers along with social interest 2. Peace and productivity goes hand in hand hence. attempt to reduce industrial dispute and promote peace is a necessity. 3. Employer employee relation should be made healthy and growing
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4. Running of the industry, day to day work should be made more democratic with increasing workers participation 5. Producing products at a very competitive price so that country can promote export and our economy can improve. 6. Bringing mental revolution in management. The determinants of good industrial relation can be promoted 1. Measures for securing and preserving unity and better relations between workers and employers 2. Arrange to probe and settle industrial dispute between employer employee or employer and employer or employee and employee, give proper representation to workers union and industrial federations of employers. 3. Both the ultimate weapons of employers and employee strike and lock out should be prevented at any cost. Proper relief to workers after a lock out or lay off through government agencies 4. Workers participation at all levels and encourage give and take principle in collective Bargaining. Industrial relation requires a study regarding I) conditions of work (ii) compensation paid for the sweat the worker makes iii) permanency of the job assured continuance of work or otherwise. The parties to Industrial Relations are 1) Workers and their unions, the intelligence level knowledge of workers, background of worker leaders, real or boghus their linkage with political unions, are to be considered for the effective relations. 2) Nature of employment and employers, whether benevolent, interested in workers or aiming to get as much profit as possible squeezing workers their attitude plays vital role in maintaining better relations. Whether they want to have team, and growth of their team as a whole or just hire and fire system. 3) Position of government, political will whether opportunitie favouring employers or interested in workers, are to be seen. Their interest in workers can be seen through their actions in creating Laws for labour welfare and implementing them effectively.
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Industrial relations development can be based 1) On a spirit of team development team building workers are to be seen as partners in the industry for national development thro industrial development, most of the laws and governments directives wants to enforce workers participation joint councils, collective improvements work etc. 2) In the above method it is Bipartite, partite there is yet another arrangement of tripartite nature; introduction acceptance and bringing up of unions. In the first case the welfare / personal man is the link between employers and employee. In this type of 1.R approach the unions are encouraged as a unifying force and to make workers understand the policies from a different position. The work becomes easier if unions are working with spirit of development and understanding. In this type of industrial Relation approach unions are having upper hand. Some times they make workers as pawn. Only workers interest is put on the front, for getting the status of employers. Pressure tactics are adopted, some time leading to strike to extract maximum from employer, this attitudes which may push towards terror tactics may not yield desired results. Quite likely entrepreneurs may start shrinking, existence of such industries may be jeoparadised. an unwanted situation. Similarly the employers roaming with a lock in his hand also will not contribute for better relations. It is the mutual understanding and appreciation only will give better results.

1.3 IMPORTANCE OF INDUSTRIAL RELATIONS

The healthy industrial relations are key to the progress. Their significance may be discussed as under 1. Uninterrupted production The most important benefit of industrial relations is that this ensures continuity of production. This means, continuous employment for all from manager to workers. The resources are fully utilized, resulting in the maximum possible production. There is uninterrupted flow of income for all. Smooth running of an industry is of vital importance for several other industries; to other industries if the products are intermediaries or inputs; to exporters if these are export goods; to consumers and workers, if these are goods of mass consumption. 2. Reduction in Industrial Disputes Good industrial relation reduce the industrial disputes. Disputes are reflections of the failure of basic human urges or motivations to secure adequate
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satisfaction or expression which are fully cured by good industrial relations. Strikes, lockouts, goslow tactics, gherao and grievances are some of the reflections of industrial unrest which do not spring up in an atmosphere of industrial peace. It helps promoting co-operation and increasing production. 3. 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. Every worker feels that he is a co-owner of the gains of industry. The employer in his turn must realize that the gains of industry are not for him along but they should be shared equally and generously with his workers. In other words, complete unity of thought and action is the main achievement of industrial peace. It increases the place of workers in the society and their ego is satisfied. It naturally affects production because mighty cooperative efforts alone can produce great results. 4. 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. Both should think themselves as partners of the industry and the role of workers in such a partnership should be recognized. On the other hand, workers must recognize employers authority. It will naturally have impact on production because they recognize the interest of each other. 5. 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. 6. 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. Thus, from the above discussion, it is evident that good industrial relation is the basis of higher production with minimum cost and higher profits. It also results in increased efficiency of workers. New and new projects may be introduced for the welfare of the workers and to promote the morale of the people at work. An economy organized for planned production and distribution, aiming at the realization of social
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justice and welfare of the massage can function effectively only in an atmosphere of industrial peace. If the twin objectives of rapid national development and increased social justice are to be achieved, there must be harmonious relationship between management and labor.

1.4 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. Determining factors of industrial relations Good industrial relations depend on a great variety of factors. Some of the more obvious ones are listed below: 1. History of industrial relations No enterprise can escape its good and bad history of industrial relations. A good history is marked by harmonious relationship between management and workers. A bad history by contrast is characterized by militant strikes and lockouts. Both types of history have a tendency to perpetuate themselves. Once militancy is established as a mode of operations there is a tendency for militancy to continue. Or once harmonious relationship is established there is a tendency for harmony to continue. 2. Economic satisfaction of workers Psychologists recognize that human needs have a certain priority. Need number one is the basic survival need. Much of men conducted are dominated by
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this need. Man works because he wants to survive. This is all the more for underdeveloped countries where workers are still living under subsistence conditions. Hence economic satisfaction of workers is another important prerequisite for good industrial relations. 3. Social and Psychological satisfaction Identifying the social and psychological urges of workers is a very important steps in the direction of building good industrial relations. A man does not live by bread alone. He has several other needs besides his physical needs which should also be given due attention by the employer. An organization is a joint venture involving a climate of human and social relationships wherein each participant feels that he is fulfilling his needs and contributing to the needs of others. This supportive climate requires economic rewards as well as social and psychological rewards such as workers participation in management, job enrichment, suggestion schemes, re-dressal of grievances etc. 4. Off-the-Job Conditions An employer employs a whole person rather than certain separate characteristics. A persons traits are all part of one system making up a whole man. His home life is not separable from his work life and his emotional condition is not separate from his physical condition. Hence for good industrial relations it is not enough that the workers factory life alone should be taken care of his off-the-job conditions should also be improved to make the industrial relations better. 5. Enlightened Trade Unions The most important condition necessary for good industrial relations is a strong and enlightened labor movement which may help to promote the status of labor without harming the interests of management, Unions should talk of employee contribution and responsibility. Unions should exhort workers to produce more, persuade management to pay more, mobilize public opinion on vital labor issues and help Government to enact progressive labor laws. 6. Negotiating skills and attitudes of management and workers Both management and workers representation in the area of industrial relations come from a great variety of backgrounds in terms of training, education, experience and attitudes. These varying backgrounds play a major role in shaping the character of industrial relations. Generally speaking, well-trained and experienced negotiators who are motivated by a desire for industrial peace create a bargaining atmosphere conducive to the writing of a just and equitable collective agreement. On the other hand, ignorant, inexperienced and ill-trained persons fail because they do not recognize that collective bargaining is a difficult human activity which deals as much in the emotions of people as in their economic interests. It requires careful preparation and top notch executive
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competence. It is not usually accomplished by some easy trick or gimmick. Parties must have trust and confidence in each other. They must possess empathy, i.e. they should be able to perceive a problem from the opposite angle with an open mind. They should put themselves in the shoes of the other party and then diagnose the problem. Other factors which help to create mutual trust are respect for the law and breadth of the vision. Both parties should show full respect for legal and voluntary obligations and should avoid the tendency to make a mountain of a mole hill. 7. Public policy and legislation: - when Government, regulates employee relations, it becomes a third major force determining industrial relations the first two being the employer and the union. Human behavior is then further complicated as all three forces interact in a single employee relation situation. Nonetheless, government in all countries intervenes in management union relationship by enforcing labor laws and by insisting that the goals of whole society shall take precedence over those of either of the parties. Government intervention helps in three different ways 1) it helps in catching and solving problems before they become serious. Almost every one agrees that it is better to prevent fires them to try stopping them after they start; 2) It provides a formalized means to the workers and employers to give emotional release to their dissatisfaction; and 3) It acts as a check and balance upon arbitrary and capricious management action. 8. Better education: - with rising skills and education workers expectations in respect of rewards increase. It is a common knowledge that the industrial worker in India is generally illiterate and is misled by outside trade union leaders who have their own axe to grind. Better workers education can be a solution to this problem. This alone can provide worker with a proper sense of responsibility, which they owe to the organization in particular, and to the community in general. 9. Nature of industry: - In those industries where the costs constitute a major proportion of the total cast, lowering down the labor costs become important when the product is not a necessity and therefore, there is a little possibility to pass additional costs on to consumer. Such periods, level of employment and wages rise in decline in employment and wages. This makes workers unhappy and destroys good industrial relations.

1.5 INDUSTRIAL RELATIONS PROGRAMME

Todays professional industrial relations director, or by whatever title he is designated, no longer views his job as personalizing management, or that of a social worker in a factory, or a union buster, he looks upon his department as an adjunct to management supervision at all levels; he keeps other executives informed about new discoveries, programme trends and needs. At the
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same time, he provides efficient service in the operation of several centralized services. A successful industrial relations programme reflects the personnel viewpoint, which is influenced by three main considerations: a) Individual thinking b) Policy awareness and c) Expected group reaction Individualized thinking makes if imperative for the administrator to consider the entire situation in which the affected individual is placed. Policy awareness underscores the idea of the consistency of treatment and the precedent value of any decision which a management takes; while expected group reaction balances what we know of human nature in groups against an individuals situation in the light of the policy that has been formulated and implemented. In all these different circumstances, reality demands that all the three aspects of the personnel viewpoint should be considered at once in terms of the past, the present and the future. This viewpoint is held at all the levels of management from the top to the bottom, from the top executives and staff to the line and supervisory personnel.

1.6 SCOPE OF INDUSTRIAL RELATIONS WORK

The staff employed in the industrial relations department should know the limitations within which it has to function. The industrial relations director generally has several assistants who help him to perform his functions effectively, and he usually reports directly to the president or chairman of the board of directors of an organization. The functions of the industrial relations staff are 1. Administration, including overall organization, supervision and co-ordination of industrial relations policies and programmes. 2. Liaison with outside groups and personnel departments as well as with various cadres of the management staff. 3. The drafting of regulations, rules, laws or orders and their construction and interpretation. 4. Position classification, including overall direction of job analysis, salary and wage administration, wage survey and pay schedules. 5. Recruitment and employment of workers and other staff. 6. Employment testing, including intelligence tests, mechanical aptitude tests and achievement
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tests. 7. Placement, including induction and assignment. 8. Training of apprentices, production workers, foremen and executives. 9. Employee counseling on all types of personnel problems-educational, vocational, health or behavior problems. 10. Medical and health services. 11. Safety services, including first aid training. 12. Group activities, including group health insurance, housing, cafeterial programmes and social clubs. 13. Suggestion plans and their uses in labor, management and production committees. 14. Employee relations, specially collective bargaining with representatives and settling grievances. 15. Public relations. 16. Research in occupational trends and employee attitudes, and analysis of labor turnover. 17. Employee records for all purposes. 18. Control of operation surveys, fiscal research and analysis. 19. Benefit, retirement and pension programmes.

1.7 FUNCTIONAL REQUIREMENTS OF A SUCCESSFUL INDUSTRIAL RELATIONS PROGRAMME

The basic requirements on which a successful industrial relations programme is based are :a) 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. b) 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. c) Adequate Practices should be developed by professionals: - In the field to assist in the
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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. d) 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. e) 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.

1.8 INDUSTRIAL RELATIONS AT NAHAR SPINNING MILLS LTD., LUDHIANA

According to Pepsico Fritolay industrial relations system consists of three agents management organizations, workers and formal/informal ways they are organized and government agencies. These actors and their organizations are located within an environment defined in terms of technology, labor and product markets, and the distribution of power in wider society as it impacts upon individuals and workplace. Within this environment, actors interact with each other, negotiate and use economic/political power in process of determining rules that constitute the output of the industrial relations system. He proposed that three partiesemployers, labor unions, and government-- are the key actors in a modern industrial relations system. He also argued that none of these institutions could act in an autonomous or independent fashion. Instead they were shaped, at least to some extent, by their market, technological and political contexts.

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Key actors in a modern industrial relations system. He also argued that none of these institutions could act in an autonomous or independent fashion. Instead they were shaped, at least to some extent, by their market, technological and political contexts. Thus it can be said that industrial relations is a social sub system subject to three environmental constraints- the markets, distribution of power in society and technology. Pepsico Fritolay's model identifies three key factors to be considered in conducting an analysis of the management-labor relationship: 1. Environmental or external economic, technological, political, legal and social forces that impact employment relationships. 2. Characteristics and interaction of the key actors in the employment relationship: labor, management, and government. 3. Rules that are derived from these interactions that govern the employment relationship. Pepsico Fritolay emphasizes the core idea of systems by saying that the arrangements in the field of industrial relations may be regarded as a system in the sense that each of them more or less intimately affects each of the others so that they constitute a group of arrangements for dealing with certain matters and are collectively responsible for certain results. In effect - Industrial relations is the system which produces the rules of the workplace. Such rules are the product of interaction between three key actors workers/unions, employers and associated organizations and government The Pepsico Fritolays model gives great significance to external or environmental forces. In other words, management, labor, and the government possess a shared ideology that defines their roles within the relationship and provides stability to the system.

Approaches To Industrial Relations

The industrial relations scenario and factors affecting it, has been perceived differently by different practitioner and theorist. Some have viewed it in terns of class conflict; some have viewed it in terms of mutuality of interest of different groups; some have viewed it as a consequence of interaction of various factors both within an organization and outside it. Based on these orientations, several approaches have been developed to explain the dynamics of IR.

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UNITARY APPROACH In unitarism, the organization is perceived as an integrated and harmonious system viewed as one happy family. A core assumption of unitary approach is that management and staff, and all members of the organization share the same objectives, interests and purposes; thus working together, hand-in-hand, towards the shared mutual goals. Furthermore, unitarism has a paternalistic approach where it demands loyalty of all employees. Trade unions are deemed as unnecessary and conflict is perceived as disruptive. From employee point of view, unitary approach means that:

Working practices should be flexible. Individuals should be business process improvement oriented, multi-skilled and ready to tackle with efficiency whatever tasks are required.

If a union is recognized, its role is that of a further means of communication between groups of staff and the company.

The emphasis is on good relationships and sound terms and conditions of employment. Employee participation in workplace decisions is enabled. This helps in empowering individuals in their roles and emphasizes team work, innovation, creativity, discretion in problem-solving, quality and improvement groups etc.

Employees should feel that the skills and expertise of managers supports their endeavors.

From employer point of view, unitary approach means that:

Staffing policies should try to unify effort, inspire and motivate employees. The organization's wider objectives should be properly communicated and discussed with staff.

Reward systems should be so designed as to foster to secure loyalty and commitment. Line managers should take ownership of their team/staffing responsibilities. Staff-management conflicts - from the perspective of the unitary framework - are seen as arising from lack of information, inadequate presentation of management's policies.
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The personal objectives of every individual employed in the business should be discussed with them and integrated with the organizations needs.

PLURALISTIC APPROACH In pluralism the organization is perceived as being made up of powerful and divergent sub-groups - management and trade unions. This approach sees conflicts of interest and disagreements between managers and workers over the distribution of profits as normal and inescapable. Consequently, the role of management would lean less towards enforcing and controlling and more toward persuasion and co-ordination. Trade unions are deemed as legitimate representatives of employees. Conflict is dealt by collective bargaining and is viewed not necessarily as a bad thing and if managed could in fact be channeled towards evolution and positive change. Realistic managers should accept conflict to occur. There is a greater propensity for conflict rather than harmony. They should anticipate and resolve this by securing agreed procedures for settling disputes. The implications of this approach include:

The firm should have industrial relations and personnel specialists who advise managers and provide specialist services in respect of staffing and matters relating to union consultation and negotiation.

Independent external arbitrators should be used to assist in the resolution of disputes. Union recognition should be encouraged and union representatives given scope to carry out their representative duties

Comprehensive collective agreements should be negotiated with unions. RADICAL APPROACH This view of industrial relations is a by product of a theory of capitalist society and social change. Marx argued that:

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 Weakness and contradiction inherent in the capitalist system would result in revolution and the ascendancy of socialism over capitalism. Capitalism would foster monopolies. Wages (costs to the capitalist) would be minimized to a subsistence level. Capitalists and workers would compete/be in contention to win ground and establish their Constant win-lose struggles would be evident. This perspective focuses on the fundamental division of interest between capital and labor, and sees workplace relations against this background. It is concerned with the structure and nature of society and assumes that the conflict in employment relationship is reflective of the structure of the society. Conflict is therefore seen as inevitable and trade unions are a natural response of workers to their exploitation by capital.

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CHAPTER 2: REVIEW OF LITERATURE

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CHAPTER 2: REVIEW OF LITERATURE

As per Dale Yoder Industrial Relations refers to the relationship between management and employees, or employees and their organization, that arise out of employment. Teed and Metcalfe observed Industrial Relations are the composite approach of the attitudes and approaches of the employers and employees towards each other with regard to planning, Supervision, direction and unification of the activities of a set up with less friction and more cooperation with mutual effort for others well-being. The essences of good industrial relation lies in the bringing up of good labour relations which gives a forum to understand each other (employer, employee) properly. Creates co-operative thinking and working to achieve the goal of the organization. A good Industrial Relations increases the morale of employers and goods them to give their maximum, each think of their mutual interest which paves way for introduction of new methods, developments and leading to adoption of modern technology. This progressive ways when designed with their mutual interest and consent develops many incentive propositions, effective participators forum is created in management. Profit are shared, workers get their dues in the organization leading to job satisfaction-which is needed for good relations. Good industrial relation increase production, improves quality of work and products efficiency of workers increased. Cost of production lowered. Judging from the attention paid by researchers, it would seem that the 1980s and 1990s was a period of change, turmoil, and even transformation in industrial relations systems all over the world. Much of this literature has been based on evidence from the advanced industrial nations (e.g., Locke 1996; Katz 1993; Swenson 1989; Kochan, Katz, and McKersie 1986; Streeck 1988; Frenkel 1988; Bray and Haworth 1993; Armingeon 1994). While there are dissenting views about whether industrial relations has in fact transformed in these nations (e.g., Golden, Wallerstein, and Lange 1997, Crouch 1993, Hyman 1994), and there have been attempts to make distinctions between transformation and non-fundamental change (Erickson and Kuruvilla 1998), there is broad agreement on the main factor driving these changes: increasingly competitive environments caused by the integration of world markets, as well as the direction of the change: decentralization of bargaining, and a movement towards increased flexibility in wages, labor deployment, and at the workplace level. Relatively less attention has been paid to how industrial relations systems have changed in
24

the developing nations of Asia, Latin America, and Africa, with some exceptions.1 Given that several Asian countries have seen considerable changes in their industrial relations systems in the 1990s, the goal of this paper is to attempt to understand the nature of the changes, and to evaluate whether or not they amount to fundamental transformations. The similarity in the timing of change in Asian IR systems with that of the West (both occurred in late 1980s and early 1990s) raises the possibility that there are universal driving forces, although idiosyncratic national forces are also presumably at work. If in fact the forces driving change in the West (primarily, increased competitive pressures) operate globally, then one would expect Asian IR systems to be most likely to evidence changes (relative to African or Latin American IR systems), given that Asian nations are generally more exposed to the global economy (World Bank, 1998). To facilitate this investigation, we first propose an argument regarding industrial relations system change. We then examine the extent to which Asian industrial relations systems are changing and whether the directions of change are similar to those we have seen in the advanced industrial countries outside of the region. Thereafter, we characterize the key features of industrial relations change, including whether or not the changes constitute fundamental transformations, based on recent work regarding how to judge whether a transformation has indeed taken place (Erickson and Kuruvilla 1998). Given that an exhaustive review of all Asian industrial relations systems is beyond the scope of one article, we focus on representative systems. Kuruvilla and Venkitaratnam (1996) argue that industrial relations systems in Asia are typified by six distinct stylized models: The Japanese flexible workplace model, the tripartite Singapore model, the state-employer dominated model (Malaysia and Indonesia), the pluralist decentralized and fragmented industrial relations model (the Philippines), the politicized multi-union model (India and the rest of South Asia), and the transitory model (a catch-all category that includes South Korea, Taiwan, China, and Vietnam). Note that the transitory model takes into account transitions from authoritarian rule to democracy (South Korea and Taiwan) as well as from closed to more open economies (China and Vietnam) during the last decades. Therefore, we examine industrial relations change in seven countries that conform closely to each of these models: Japan, South Korea, Singapore, Malaysia, the Philippines, India, and China. Not only are these countries representative of the Asian region in general terms (they constitute the majority of Asian GDP and population); they also represent the range of industrial relations systems, and they provide a good representation of the different levels of economic
25

development within Asia (with Japan being an advanced industrialized country; South Korea and Singapore being Newly Industrialized Countries, also known as "Tigers"; Malaysia and the Philippines being newly emerging industrial nations; and India and China having only recently opened their doors to the world economy). Title: Industrial Relations Advisory Services in a Changing Market Author(s): L.C. Hunter, Mairi Steele Journal: Management Research News Year: 1988 Volume: 11 Issue: 1/2 Page: 55 56 ISSN: 0140-9174 DOI: 10.1108/eb027968 Publisher: MCB UP Ltd

Industry's need for external advisory assistance in the management/industrial relations area will be determined by the nature of the problems currently faced or anticipated. These problems in turn will be influenced by the industrial sector, size of establishment, technology and the economic and legal context. Industrial Relations: Challenges and Opportunities Based on the 1991 Shirley Lerner Memorial Lecture, a discussion is conducted of the challenges and opportunities facing teachers and researchers arising from the rapidly changing practice of industrial relations. A widening of the scope of the subject, to include its individual as well as collective aspects, it is argued, is fully compatible with seeing the main focus as the employment relationship. The challenge to the subject's research tradition of empirical enquiry, multidisciplinarity and above all, its integrity, is much more fundamental. Maintaining this tradition is not only vital for industrial relations, but also for the future direction of the business schools in which most industrial relations teachers and researchers find themselves. Title: International Comparisons in the Study of Industrial Relations Author(s): Ron Bean Journal: Employee Relations Volume: 9 Issue: 6 Page: 3 7 DOI: 10.1108/eb055109 Publisher: MCB UP Ltd Year: 1987 ISSN: 0142-5455

More comparative research in industrial relations is needed. Whilst there maybe valid criticisms of the adequacy of existing work, it is nevertheless useful in enhancing the cumulative development of the discipline. Apart from being of assistance in the development and testing of
26

hypotheses, it can also make us more aware that aspects of our own system require explanation rather than being taken for granted. Title: Industrial Relations Training for Managers Author(s): J.H. Mulholland Volume: 5 Issue: 3 DOI: 10.1108/eb055015 Journal: Employee Relations Year: 1983 Page: 21 26 ISSN: 0142-5455 Publisher: MCB UP Ltd

The quality of management is the greatest single determinant of industrial performance. Its impact is felt as much in the social as in the economic sphere, in terms of the quality of life in an organisation as in profitability. Given the much publicised shortcomings of industrial relations which are damaging to industry and to the economy, the case for ensuring that managers are adequately trained is not merely compelling, but almost self-evident.

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CHAPTER 3: INDIAN TEXTILE INDUSTRY

28

CHAPTER 3: INDIAN TEXTILE INDUSTRY

The textile and apparel industry contributes significantly to the Indian economy. It accounts for 14 per cent of total industry output and nearly 5 per cent of Gross DomesticProduct (GDP). It provides direct employment to 38 million people and is the largest foreign exchange earner, contributing nearly 20 per cent to Indias total exports. In the last three years, the sector has attracted a total investment of US$ 5,770 million. The cumulative Foreign Direct Investment (FDI) made in this sector between 1991 and 2007 has been US$ 575 million, representing 1.22 per cent of the total FDI attracted by the country.2

The industry has been growing acrosssegments Production of textile yarn witnessed a compounded annual growth rate (CAGR) of 3.6 per cent between 1996 and 2006. Finished cloth has witnessed a higher CAGR of 4.1 per cent during the same period. This growth outperforms the global production, which experienced a CAGR of 2.25 per cent (both yarn and cloth). Most of this growth is contributed by non-cotton yarn, which grew at 6 per cent CAGR in 2006. Textile exports have witnessed a CAGR of 11.8 per cent in 19962006. Man-made textiles have shown maximum growth and witnessed the highest CAGR at 14.5 per cent followed by Ready-Made Garments (RMG) at 12.4 per cent. USA and EU are the major markets contributing nearly 80 per cent to textile exports.

India Brand Equity Foundation (IBEF) is a public-private partnership between the Ministry of Commerce & Industry, Government of India and the Confederation of Indian Industry, 2009 29

The Textile Value Chain Process

Sourcing of raw materials, ginning and extrusion of fibre

Spinning

Weaving/ Knitting

Processing

Apparel Making

Distribution Retailing

Process

Ginning and Cleaning machines

Spinning Mills

Weaving / Knitting Units

Processing Units

Apparel Design & Making Apparel Design & Making

Outlets/ Stores

Process

Ginning and Cleaning machines

Spinning Mills

Weaving / Knitting Units

Processing Units

Outlets/ Stores

Output

Man-made fibre cotton, jute, silk, Wool

Yarn

Fabric

Processing Fabric

Garment

Units

1,135 small scales: 1,564 large scale

Hand looms 3.9 million Powerlooms 1.8 million

2,100

7, 7000 Units

Remarks

Fairly large, well organized and financially strong

Large Capacity Fragmented

Weak and unorganised

Some Large Player

Fragmented Consolidating

Fairly Organised

Figure 1: The Textile Value Chain Source30

3.1 MARKET & OPPORTUNITIES

Export of textile is projected to grow at 22 per cent between 2007 and 2012 and expected to reach US$ 55 billion by 2012. The Indian Textile in Industry spans all activities across the value chain Raw Materials The major raw materials for the textile and apparel industry include cotton, jute, silk, wool and man-made fibre. Cotton In 2005-06, India was the second largest producer of cotton (4.15 metric tonnes) in the world, accounting for 16.75 per cent of the global production. Cotton is the predominant fabric used in the Indian textile industry, accounting for nearly 60 per cent of production. The average yield of cotton per hectare in India is about 400 kilograms which is considered low. Cotton exports to major countries stood at US$ 3,203 million in 2005-06. Wool The wool industry is small in size and scattered across the country, with 77 per cent of the production coming from northern states. This sector consists of both organized players (composite mills, combing units, worsted and non-worsted spinning units, knitwear and woven garments units) and de-centralised units (hosiery and knitting units, power-loom units, hand-knotted carpets, druggets and namdah units, independent dyeing and processing houses). The total production of wool in 2006 was about 55 million kilograms. Jute The jute industry is labour intensive. Production of jute goods in India in 2005-06 was 1.582 metric tonnes. Jute exports for the year 2005-06 stood at US$ 272 million. About 75 per cent of the total capacity of the jute industry is being utilised at present. Silk India is the second largest producer of silk in the world, contributing 18 per cent to the total global production. It has the distinction of producing all the four varieties of silk (Mulberry, Eri, Tasar and Muga). The total silk production in 2004-2005 stood at 44,322 million square metres.
31

Silk exports earned US$ 413.64 million in 2004-05. Man-made fibres Man-made fibres consist of synthetic fibres such as polyester filament yarn, polyester staple fibre, acrylic staple fibre, nylon filament yarn and cellulose fibre/yarn such as viscose fibre/yarn. India is a leading producer of viscose filament yarn. The total production of man-made fibres stood at nearly 1 billion kilograms in 2006-07. While there is abundant availability of raw materials, the Indian textile and apparel industry has been suffering from low productivity due to low farm yields affecting cotton production, accentuated costs incurred in additional processes to clean cotton fibres, poor (old and outdated) ginning equipment and high defect rates in production. Spinning The spinning sector in India is completely (100 per cent) organised and is globally competitive in terms of variety, process and production quantity. India has about 40 million spindles (23 per cent of the world). Independent spinning mills account for about 75 per cent of total capacity and 92 per cent of the total production. These mills are chiefly located in North India. The spinning process is technologically intensive, the output is affected by the quality of fibre and the cleaning process of raw materials. Weaving/Knitting Indias weaving/knitting sector is highly unorganised, with the organised sector contributing to just 5 per cent of the total production. There are about 3.9 million hand looms and 1.8 million power-looms in India. Hand looms cater to both ends of the value chain, i.e. mass consumption, as well as specialty use. Hand looms are located mostly in rural areas such as Pochampally in Andhra Pradesh and Kanchipuram in Tamil Nadu. Demand for standardisation in apparel segments such as sarees has given a significant impetus to powerlooms, which contribute to 62 per cent of the total cloth production. Knitting units are successful in export channels. Some of the prominent weaving/knitting clusters include Tirupur in Tamil Nadu and Ludhiana in Punjab. This is the weakest link in the supply chain suffering from problems such as high power tariffs and low investments in technology.
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Processing Indian processing sector is largely decentralised withlow levels of automation, marked by hand/independent processing units. This has lead to inconsistency in production and lack of conformance to quality. About 2,300 processors are operating throughout India, including about 2,100 independent units and 200 units that are integrated with spinning, weaving or knitting units. Apparel Making The apparel sector has over 25,000 domestic manufacturers, 48,000 fabricators and around 4,000 manufacturers/exporters. Over 80 per cent of the total units are small operations (less than 20 machines) and are either proprietorship or partnership firms. Access to a variety of raw materials and flexibility of supply chain enables apparel manufacturers to mix and match various constituents and come up with innovative designs. However, this advantage has not been leveraged effectively. Apparel exports in 2006-07 stood at US$ 10 billion, with a year on year growth of 8.4 per cent An important sub-segment of the apparel segment is the Ready-Made Garments segment (RMG). This is the largest export segment contributing to 45 per cent of the total textile exports. RMG exports are expected to touch US$ 14.5 billion with a CAGR at 18-20 per cent.

3.2 OPPORTUNITIES FOR IN VESTING IN THE INDIAN TEXTILE SECTOR3

Attractiveness of the industry Favourable factor conditions Favourable factor conditions provide India with a strong comparative advantage over other competing countries in the textile industry. Specifically, India has the following strengths:

Srinivasan T.N. (2004), China and India: economic performance, competition and cooperation: an updates, Journal of Asian Economics 15 (2004) 613636. 33

Cost Competitiveness Yarn: US $ per kg of yarn

Fabric: US$ per yard of fabric

Open-ended Yarn

Graph1: Open-ended Yarn

Open-ended Woven Fabric

Graph2: Open-ended Woven Fabric

Open-ended Knitted Fabric

Graph3: Open-ended Knitted Fabric

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Ring Yarn

Graph4: Ring Yarn

Ring Woven Fabric

Graph5: Ring Woven Fabric

Ring Knitted Fabric

Graph6: Ring Knitted Fabric

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Textured Yarn

Graph7: Textured Yarn

Textured Woven Fabric

Graph8: Textured Woven Fabric Textured Knitted Fabric

Graph9: Textured Knitted Fabric Abundant and low price supply of raw-materials: As can be seen from the cost competitiveness
36

chart, India is more cost-competitive than China and Brazil across a range of materials. India also has a diverse supply of raw materials, 23 varieties of cotton and all four varieties of silk. This inherent strength in availability of raw materials insulates the market from any supply-side shocks. Availability of low cost skilled labour: Labour costs in India continue to be significantly low as compared to other countries. This factor provides a significant advantage to the textile industry in India, in terms of increased

Graph10: Cost Competitiveness Chart Source- KPMG Analysis Favourable domestic market With increase in disposable income levels, consumer awareness and propensity to spend and the demographic trends in India are changing significantly. According to NCAER data, the consuming class, with an annual income of US$ 980 or above, is growing continuously and is expected to constitute over 80 per cent of the population by 2009-10. There is a significant change in the consumer mindset which has led to a growing trend of increased consumption of personal care and lifestyle products, as well as branded products. These trends offer great growth opportunities to companies across various sectors, including textiles. In response to this growing demand for consumption a revolution is taking place in Indias retail sector. Organised retail is playing a key role in structuring the Indian domestic market, reinforced by the rapid rise of supermarkets, malls, theme stores and franchises across urban India. India

37

thus presents a large and vibrant market for textiles and apparels, with a potential for sustained growth. Government initiatives to promote investment It is estimated that this industry will require US$ 22 billio of new capital investments over the next five years. With a view to raise Indias share in the global textile trade to 10 per cent by 2015 (from the current 3 per cent), the Ministry of Textiles has proposed 50 new textile parks. Out of the 50 proposed parks, 30 have been already sanctioned by the Government (with a cost of US$ 710 million). Set up under the Scheme for Integrated Textile Parks (SITP), this initiative will not only make the industry cost competitive, but also enhance the manufacturing capacity of the sector. To promote the industrys growth, the Government has also taken various support initiatives in areas such as: Product development and design: Encouraging institutes such as NIFT (National Institute of Fashion Technology) and Apparel Training and Design Centres (ATDCs). There are several colleges, including the Indian Institutes of Technology and National Institutes of Technology, that offer courses in Textile Engineering. Technology Upgradiation: The Government of India established the Technology Upgradation Fund Scheme (TUFS), to enable firms to access subsidised low-interest loans for technology upgradation. Under this scheme, the Government reimburses 5 per cent of the interest rates charged by the banks and financial institutions, thereby ensuring credit availability for upgradation of technology at global rates. In a further bid to bolster the growth, the Government is also expected to increase the TUF from US$ 124 million in 2006-07 to US$ 211 million in 2007-08 Revival of sick units: Revival plans of the mills run by National Textiles Corporation (NTC). Already, US$ 2.21 million worth of machinery has been ordered for the upgradation and modernisation of 18 textile mills Others: The Government of India has also included new schemes in the Annual Plan for 200708 to provide a boost to the textile sector. These include schemes for foreign investment promotion to attract FDI in textiles clothing and machinery; brand promotion on Public- Private Partnership (PPP)) approach to develop global acceptability of Indian apparel brands; trade facilitation centres for Indian image branding; fashion hubs for creation of permanent market
38

place for the benefit of Indian fashion industry; common compliance code to encourage acceptability among apparel buyers and training centres for human resource development on PPP mode The fragmented structure of the industry provides the advantage of a large pool of skilled workmen in different areas of textile manufacturing and also gives scope for entry of organised integrated textile manufacturers. Small scale units in different sectors can also be leveraged as a supply base, for sourcing materials at low cost. Attractive Segments for Investment4 The different segments within Indias textile and apparel industry have been assessed along two parameters- the growth opportunity offered, based on market trends and gaps in current capabilities and the supportive environment, based on Government policy initiatives to

Figure 2: Attractive Segments for Investment Source- KPMG Analysis

Dutta Devangshu, 2003, Indian Textile and Apparel Industry (Based on presentation made at Interstoff-Asia Spring) 39

support the segment. Based on these parameters, the following segments appear attractive, and are discussed in the following sections. Sourcing Sourcing of raw materials from India could be an attractiveoption for players looking to enter the Indian textile market. The cost of raw materials in India is amongst the lowest in the world. However, there is room for improving the quality of cotton. The quality of the fabric can also be significantly improved, by investing in modern ginning equipment. There is a growing need for new fabrics, such as, polysatin, viscose, etc. the processes of which are technologically intensive. While some global buyers are leveraging Indias cost advantage by directly collaborating with Indian suppliers to source material, the Government has focused on supporting the industry, to improve quality and acquire technology. The Ministry of Textiles encourages firms to improve quality by introducing various quality certifications like ISO The Ministry has also incorporated a Technology Upgradation Fund to encourage investment in technology Weaving Weaving/knitting units in India are weak and small in size. Many are faced with debt problems and require capital investment. At the same time, increased demand for fabric from home and industrial textiles will require significant investments in modern processing machinery. In these circumstances, investments in modern weaving / knitting units in India could yield benefits. The Government has proposed credit-linked capital subsidy for procurement of modern power-looms. Processing There is an increasing need to adapt prints to the export market. Also, companies need to invest in technology like natural wash and laser wash to bring Indian garments at par with quality of garments in the export market. The Government provides a capital-linked subsidy of 10 per cent in addition to 5 per cent reimbursement on the interest paid for loans taken by processing units.
40

Garmenting The RMG sub-segment is growing at a rapid pace, with RMG exports expected to touch US$ 55 billion by 2010. This segment also needs injection of new technology, especially in bringing out new and contemporary designs quickly to the market. Successful arrangements for investing in this sector Different business models have been tried out by players investing in the Indian textile sector, to leverage the existing capabilities. Two such models that could be options for new investors, are discussed below: Sourc ing Weaving Clusters Common Processing Facility Cutting, Stitching and Garments

Centralised Sourcing

- Common processing facility for a set of clusters - Leverage Govt. schemes such as SITP, SEZs and TUFs especially in locations/states where there are special incentives for setting up processing/weaving units

Branding the yarn/ fabric/prints with the apparel in case of high-value products

Figure 3: Producer Model: The MNC invests in processing and weaving segments of the value chain. Source- KPMG Analysis

3.3 PRODUCER MODEL

The MNC invests in processing and weaving segments of the value chain. The operating model The MNC invests in the processing and weaving segments of the textile value chain. This is done by acquiring an equity stake in the processing and weaving units. Since the processing segment is fraught with problems related to quality conformance across various units, the MNC might set up
41

a common processing facility for a group of weaving clusters. Orders are allocated to these units based on the manufacturing competence and capacity utilisation. There should be a centralised sourcing system of raw materials to leverage advantages of large orders. This centralisation also helps effective order tracking. The MNC might also invest in a captive power unit for cost containment. The MNC should also strategise its production with the retail demand, as many retailers usually communicate their buying plans 9-10 months in advance. The MNC might also promote the fabric with the final product-apparel in case of high-value garments, where the quality of fabric makes considerable difference. Key advantages of this business model This model best exploits the various incentives in the processing and weaving segments that are provided by the Government. It improves bargaining power with yarn suppliers. Since the weaving and processing segment is highly fragmented, this business model will bring significant organisation in the sector. This model is being successfully followed in India, by Zeiglertex (Also see case study on Zeiglertex, included later in this document). The Apparel-manufacturer model Garment manufacturing model: The MNC invests in designing and manufacturing of garments Sourcing and spinning Weaving and Processing Cutting, Stitching and Garments and Retailing

Can have a sourcing/buying liaison Source: KPMG Analysis

Provides technology support to these units for procuring best-in-class equipment

Leverages

brand

and

superior design technology - May target both domestic as well as export markets

Figure 4: Apparel-manufacturer Model

42

Source- KPMG Analysis

Features of the operating model

The MNC invests in a cutting/stitching and garmenting unit. The output is sold under the MNC brand. It caters both to export as well as domestic markets. This investment could be through a JV with an indian player, or as a standalone unit. The MNC offers technology support to the weavingand processing clust ers to import best-inclass equipment from other countries to enhance the quality of fabric. It also agrees with the clusters on adherence to stringent quality norms For better order management and to avoid supplyside shocks, the MNC announces its buying plans well in advance. Key Benefits This is the most attractive segment for exports with RMG contributing to 40 per cent of total exports. Lifestyle brands from MNCs abroad are fast gaining prominence in the Indian market. Currently, they can reach only the premium segment, due to high pricing of the apparels. Using a costeffective production strategy as suggested the MNC can successfully bring down the cost of the apparels enabling it to target other customersegments of the domestic market This model is being followed in India by Benetton. While MNCs following the above business models are successful, it is important to note that integration across the value chain will provide a key advantage to this sector as discussed earlier. Critical Success factors for manufacturers in the Textilesand Apparel Industry While India provides various opportunities such as abundant availability of raw materials, low cost of labour and favourable government policies, many critical factors Scale Indian firms are typically smaller in scale when compared to their Chinese counterparts and there are fewer larger firms in India. For instance, on an average, Chinese firms have 1.5 times higher spinning capacity than those of India. Scale influences cost structure as it gives an opportunity to exploit economies of scale and an ability to attract customers with large orders. Firms must have managerial capabilities to design appropriate supply chains to manage this scale and also the
43

contribute to a

manufacturers success, both in domestic as well as international markets. These factors include:

workforce, especially in the case ofgarment manufacturing, which is order driven and hence requires full-time workforce even in lean seasons. Well integrated and lean supply chains: Shorter cycle and delivery times The Indian textile industry has a long and complex supply chain. This affects not only the cycle times, but also the delivery times. The average cycle time in the Indian textile industry is about 45-50 days, which sometimes extends to 80 days. The mean delay in the supply chain from procurementof raw materials and to export of finished goods is 15.5 days. Shelf life of fashion driven products is very short(approximately 45days), hence such delays are untenable. These delays not only affect time-to-market, but also Workin-Progress (WIP), variability of supply chain and hence the cost. Therefore strong deployment of industrial engineering with particular emphasis on cellular manufacturing and JIT systems, in order to establish lean supply chains is extremelycrucial for manufacturers. Presence across the value chain, vertical integration and investment in captive power units helps in effective demand assessment, resulting in greater control over the supply chain and cost reduction. Customer-centricity in products and brand competitiveness A review of products imported by the US from China reveals that the top three products in terms of percentage increase in imports belong to the synthetic products category. However, Indian products dont feature in this list. Synthetic products contribute to nearly 50 per cent of the global trade and India lacks a prominent position in this segment. This is also true of other segments such as nano-textiles, home textiles and industrial textiles. This shows that a clear understanding of the demand in world markets and hence developing product portfolios to cater to that demand is crucial for increasing market share. Products with higher fashion content ,such as embroidery and sequins have gained greater response in the EU and US markets. India has significant strength in value addition and fashion content. Manufacturers must develop the ability to leverage these strengths to gain competitiveness in the export markets. The Indian consumers expenditure on branded apparel is increasing as indicated by the growth of branded apparel at 25 per cent. To match up to this growing market, manufacturers must make significant investments in brand creation and promotion.
44

Collaboration with foreign counterparts India is slowly emerging as a good out-sourcing destination for large retailers in US and EU markets. To take advantage of these trends, Indian manufacturers can enter into collaborative arrangements with foreign players, thereby gaining entry into international production, sourcing and marketing networks. This will not only give them access to international markets, but also provide them a scope for gaining technical and marketing expertise from their foreign partners.

3.4 AGREEMENTS AND ROLE OF MNCS

Indias textile industry is an attractive sector that is poised for growth post the Multi-fibre Agreement (MFA) regime. The industry enjoys significant strengths and advantages, such as, availability of raw materials, labour, domestic market and supportive government policies. The industry is also undergoing transformation, with an increasing number of MNCs establishing Their presence to leverage Indias potential. While the structure is characterised by small scale powered unorganised players, attractive government policies and increasing commitment of players across the value chain has led to the growth of vertically-integrated, large-scale units as well. Many states in India in a move to tap their potential have designed specific incentives for the textile sector. Many MNCs have taken advantage of these opportunities and have succeeded immensely. Efficient supply chains, superior technology and customer centricity and the ability to leverage the Government incentives are the key success factors for the growth of MNCs in this sector.

45

CHAPTER 4: COMPANY PROFILE

46

CHAPTER 4: COMPANY PROFILE

Spinning a web of pure enchantment seems to be the aim and objective of NAHAR SPINNING, reckoned to be the blue-chip in the NAHAR firmament. Starting out as a tiny worsted spinning & hosiery unit in Ludhiana, it was incorporated as Private Limited company in December 1980 & became a Public Limited company in 1983. The steady growth in manufacture & export of woolen/cotton hosiery, knitwears & woolen textiles enabled the company to earn the recognition as an Export House followed by a Recognized Trading House by the Government of India in a short span of 8 years. Its turbo-charged performance brought them a host of fresh laurels they include the National Export Trophy and "Gold Trophy" by the Apparel Export Promotion Council and "Gold Trophy" by 'Cotton Textile Export Promotion Council' in recognition of its excellent Export performance. In 1992, as a measure of backward integration, the company diversified into the Spinning Industry. Today it has an installed spindlage of 346096 spindles. Simultaneously the company also established an ultra modern facility to manufacture 12.5 Million pieces of Hosiery Garments. Today Nahar Spinnings T-shirts are being exported to reputed international brands such as GAP, Arrow, Chaps, Old Navy, Pierre Cardin, Philips Van Heusen, Izod, Quicksilver, Price Costco etc. As a measure of further value addition Nahar Spinning has put up a plant for the manufacture of fine count mercerized yarn & fabrics catering to both, the domestic hosiery garment market as well as export markets. To make use of the emerging opportunities on the Global Textile Scenario and also to have a focused business approach, the company went in for the Scheme of Demerger and Arrangement to restructure its businesses. The Scheme was approved by the Hobble Punjab & Haryana High Court vide its Order dt. 21st December, 2006. As per the scheme, companys Investment Activities stand demerged and transferred to Nahar Capital and Financial Services Limited. This has drawn a visible line between two segment i.e., One Industrial (Textile) business and Secondly
47

Investment and Financial Activities. Further as per the scheme Textiles Business of Nahar Exports Limited stand demerged and transferred to the company (post demerger of investment business) in accordance with the terms of the scheme. Thus upon implementation of the Scheme the spindlage capacity of the company stand increased to 3.46 Lacs spindles. The Company's mantra "World is our markets" is truly reflected in its operations. The Company is one of the largest integrated textile player in India. The Management vision coupled with company's inherent strength in terms of cost and quality has enabled the company to become the second largest Cotton Yarn manufacturer in India.

4.1 MANAGEMENT
Board of Directors:

Sh. Jawahar Lal Oswal (Chairman) Sh. Dinesh Oswal (Managing Director) Sh. Kamal Oswal Sh. Dinesh Gogna Sh. S.K. Sharma Dr. (Mrs.) H.K. Bal Sh. Amarjeet Singh Dr. O.P. Sahni Prof. K.S. Maini Dr. Suresh Kumar Singla

Finance Controllers:

Sh. Anil Kumar Garg

48

Sh. P.K. Vashishth

Company Secretary:

Sh. Brij Sharma

Auditors: M/s Gupta Vigg & Co. Chartered Accountants 101, Kismat Complex, G.T. Road, Miller Ganj, Ludhiana-141 003.

4.2 PRODUCTS DIVISION

Spinning Division

The company has 346096 spindles for manufacturing Cotton, Synthetic & Blended Yarns.The company has also processing/finishing house with a capacity of 12600 M.T. for yarn and Fabrics and a Mercerizing cum Dyeing plant for manufacturing of High Value Added Yarn, for the quality conscious market of U.S. & European Union. The capacity of the plant is 2040 M.T. Expansion Plans The avail the emerging opportunities, company is going in for an expansion of its Spinning capacity by adding 90,000 spindles in Madhya Pradesh and Punjab. The approximate capital outlay for the project is approx. 300 Crores which is to be financed through Term Loan under Tuff Scheme and internal accruals of the company. After expansion, company's spindlage capacity will increase to 4.36 lacs spindles. The management is quite optimistic that enhanced capacity will enable the company to further improve its financial performance in the coming years. Hosiery Garments Division The Garment Division contributed Rs. 191.20 crores towards the revenue of the company out of which Rs.146.20 crores is export turnover.
49

Because of its excellent export performance, Company has been awarded Golden Trophy by the Apparel Export Promotion Council for achieving highest Export of Cotton Garments for the year 2007-2008.

4.3 MILESTONES IN OUR HISTORY

Achievements Installed Capacity of 346096 spindles | ISO-9002 certified | Golden Trading House Installed Capacity of Mercerizing plant - 2040 MT | Garment - 12.5 Million pieces New Expansions 90000 spindles at a capital outlay of Rs.300 Crores.

2003-2004 The Cotton Textile Export Promotion Council awarded TEXPROCIL SILVER TROPHY to the company for its outstanding Export performance in yarns
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2006-2007 The Apparel export promotion councill awarded AEPC achievment award to the company for achieving highest exports in garment. 2008 Apparel Export promotion council awarded Gold Trophy for achieving highest Export of Cotton Garments. 2009 The Cotton Textiles Export Promotion Council (TEXPROCIL) awarded Gold Trophy for highest export of Cotton Yarn (Counts 50s and below) 2009 Turnover crosses Rs.1000 crore mark. 2010 Decides to increase capacity by adding another 90000 spindles.

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CHAPTER 5: OBJECTIVES OF THE STUDY

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CHAPTER 5: OBJECTIVES OF THE STUDY

To study the factors responsible for making decisions about industrial relations. To analysis the collective agreement and relationship between management and unions. To study the common reasons for industrial actions and reduction of workforce at workplace. To study the work-life balance, wages and commitment of the employees regarding industrial relations. To study the relationship between employee-management and satisfaction towards industrial relations agreement.

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CHAPTER 6: RESEARCH METHODOLOGY

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CHAPTER 6: RESEARCH METHODOLOGY

Meaning of Research: Research in common parlance refers to a search for knowledge. And according to Redman and Mory systematized effort to gain new knowledge. And some people consider research as movement, a movement from known to the unknown. Thus Research is an original contribution to the existing stock of knowledge making for its advancement. It is the pursuit of truth with the help of study, Observation, comparison and experiment. In short, the search for knowledge through objective and systematic method of finding solution to a problem is research. Objectives of Research The purpose of research is to discover answers to questions through the application of scientific procedures. The main aim of research is to find out the truth which is hidden and which has not been discovered as yet. Research objectives as falling into a number of following broad groupings: 1. To gain familiarity with a phenomenon or to achieve new insights into it (studies with this object in view are termed as exploratory or formulative research studies). 2. To portray accurately the characteristics of a particular individual, situation or a group (studies with this object in view are known as descriptive research studies). 3. To determine the frequency with which something occurs or with which it is associated with something else ( studies with this object in view are known as diagnostic research studies) Type of Research The Research is Descriptive Research which is fact finding in nature. Descriptive Research Descriptive research includes survey and fact-finding enquiries of different kinds. The major purpose of descriptive research is description of the state of affairs, as it exists at present. Basis of study
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The study will be based on Primary as well as on Secondary data. Interview with employees of the Nahar Spinning Mills Ltd., Ludhiana and the information was collected from the employees with the help of a structured questionnaire. And secondary data collected from company broacher and related website. SAMPLING DESIGN SAMPLING UNIT Employees of Nahar Spinning Mills Ltd., Ludhiana SAMPLE SIZE 100 employees from Nahar Spinning Mills Ltd., Ludhiana SAMPLING TECHNIQUE In this study, the respondents were chosen through convenience sampling. SCOPE OF THE STUDY Scope of the present study is Industrial Relations in Nahar Spinning Mills Ltd., Ludhiana. STATISTICAL TOOL Data collection through survey was analyzed with the help of simple % Tabular & graphic method that includes both graphs & Pie Charts.

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CHAPTER 7: DATA INTERPRETATION & ANALYSIS

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CHAPTER 7: DATA INTERPRETATION AND ANALYSIS

MANAGING IR/HR 1. Who has main responsibility for making decisions about industrial relations or human resource management which apply to this workplace? Table: 1

Yourself, or Senior Supervisor Higher Authority Graph: 1

11 19 37 43

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 11 of them say decisions about industrial relations or human resource management is taken by yourself, 19 of them say decisions about industrial relations or human resource management is taken by seniors, 37 of them say decisions about industrial relations or human resource management is taken supervisor and rest 43 of them say decisions about industrial relations or human resource management is taken higher authority.

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2. What is the length of the most common shift worked at this workplace? Table: 2

5-8 Hours 8-10 Hours More Than 10 Hours Graph: 2

33 42 25

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 33%of them say that the most common shift worked at this workplace is 5-8 hrs, 42% of them say that the most common shift worked at this workplace is 8-10 hrs and rest 25% of them say that the most common shift worked at this workplace is more than 10 hrs.

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INDUSTRIAL ACTIONS AND UNION 3. Was that collective agreement negotiated with a union? Table: 3

Yes No Graph: 3

89 11

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 89% of them say yes collective agreement negotiated with a union and rest 11% of them say no collective agreement does not negotiated with a union.

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4. How would you rate overall the relationship between management and unions at this workplace? Table: 4

Very good Good Neither good nor poor Poor Very poor Graph: 4

36 29 10 16 9

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 36% of them say the relationship between management and union is very good, 29% of them say the relationship between management and union is good, 10% of them say the relationship between management and union is neither good nor poor, 16% of them say the relationship between management and union are poor, and rest 9% of them say the relationship between management and union are very poor.

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5. Have any of the following taken place at this workplace in the last year? Table: 5 Strikes or picketing Stop work meetings Overtime bans, restrictions, work to rule or go slows Other bans Graph: 5 0 24 49 27

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana strikes or picketing have not occurred in the last year, 24% of them say stop working meetings due to some industrial relations , 49% of them say overtime bans, restrictions and work to rule or go slow, and rest 27% o them say some other bans occurred in the last year.

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6. What have been the most common reasons for the industrial action, or actions, at this workplace over the past year? ACCEPT MULTIPLES Table: 6 Negotiations over a enterprise agreement Outsourcings, use of contractors or labor hire Health and Safety issues Implementation /interpretation of agreement/award Dismissal, discipline Management decisions or proposals Industry or state wide issue Redundancy Other Graph: 6 29 19 35 27 19 32 21 22 27

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 29 of them say Negotiations over a enterprise agreement is the most common reasons for the industrial action, or actions, at this workplace over the past year, 19 of them say Outsourcings, use of contractors or labor hire is the most common reasons for the industrial action, or actions, at this workplace over the past year, 35 of them say Health and Safety issues is the most common reasons for the industrial action, or actions, at this workplace over the past year, 27 of them say Implementation /interpretation of agreement/award is the most common reasons for the industrial action, or actions, at this
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workplace over the past year, 19 of them say Dismissal, discipline is the most common reasons for the industrial action, or actions, at this workplace over the past year, 32 of them say Management decisions or proposals is the most common reasons for the industrial action, or actions, at this workplace over the past year, 21 of them say Industry or state wide issue is the most common reasons for the industrial action, or actions, at this workplace over the past year, 22 of them say Redundancy is the most common reasons for the industrial action, or actions, at this workplace over the past year and rest 17 of them say other reasons is the most common reasons for the industrial action, or actions, at this workplace over the past year

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WAGES AND ENTITLEMENTS 7. During the last year, which of the following was the majority of your non-managerial employees entitled to? Table: 7 A higher rate of pay when they work overtime Penalty rates when they work on weekends Paid maternity leave Annual leaves loadings Performance related pay component Annualized salary Paying out accrued holidays Paying out accrued sick leave Roister days off Graph: 7 55 32 4 11 42 33 25 21 39

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Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 55 of them say that last year the majority of your non-managerial employees entitled to a higher rate of pay when they work overtime, 32 of them say that last year the majority of your non-managerial employees entitled to penalty rates when they work on weekends, 4 of them say that last year the majority of your non-managerial employees entitled to paid maternity leave, 11 of them say that last year the majority of your non-managerial employees entitled to Performance related pay component, 42 of them say that last year the majority of your non-managerial employees entitled to Performance related pay component, 33 of them say that last year the majority of your nonmanagerial employees entitled to annualized salary, 25 of them say that last year the majority of your non-managerial employees entitled to paying out accrued holidays, 21 of them say that last year the majority of your non-managerial employees entitled to paying out accrued sick leave and rest 39 of them say that last year the majority of your non-managerial employees entitled to rustier day off.

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PROFIT, COSTS AND PRODUCTIVITY 8. Compared to a year ago, have the labor costs of this workplace increased, decreased or stayed the same? Table: 8 Increased Decreased Stayed the same Dont know Graph: 8 67 8 23 2

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 67% of them say that the labor costs of this workplace has increased, 8% of them say that the labor costs of this workplace has decreased, 23% of them say that the labor costs of this work place had stayed the same and rest 2% of them say that they dont know about the labor costs of this work place.

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9. Compared to a year ago, has productivity at this workplace increased, decreased or stayed the same? Table: 9

Increased Decreased Stayed the same Dont know Graph: 9

47 10 29 14

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 47% of them say that the productivity at this workplace has increased, 10% of them say that the productivity at this workplace has decreased, 29% of them say that the productivity at this place stayed the same, and rest 14% of them say that they dont know about the productivity at this work place.

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WORKFORCE REDUCTIONS & ADDITIONS 10. Has management intentionally reduced the size of the workforce at this workplace at any time in the last year?

Table: 10

Yes No Graph: 10

37 63

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 37% of them say yes the management intentionally reduced the size of the workforce at this workplace at any time in the last year , and rest 63% of them say that the management intentionally reduced the size of the workforce at this workplace at any time in the last year

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11. What was the reason or reasons for this reduction on the last occasion? ACCEPT MULTIPLES Graph: 11 Lack of demand for the product or service Technological change Organizational restructuring Financial problems or difficulties To decrease costs or increase efficiency Others Dont know Graph: 11 4 3 12 6 5 4 3

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Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 11% of them say that lack of demand for the product or service is one of the reasons for this reduction on the last occasion, 8% of them say that the technological change is one of the reasons for this reduction on the last occasion, 32% of them say that the organizational restructuring is one of the reasons for this reduction on the last occasion, 16% of them say that the financial problems or difficulties is one of the reasons for this reduction on the last occasion, 11% of them say that other reasons for this reduction on the last occasion and rest 8% of them say that they dont know about the reasons for this reduction on the last occasion.

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ATTITUDES OF MANAGEMENT 12 How would you rate the relationship between employees and management at this workplace? Table: 12 Very good Good Neither good nor poor Poor Very poor Graph: 12 25 37 22 9 7

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 25% of them say that the relationship between employees and management at this workplace is very good, 37% of them say that the relationship between employees and management at this workplace is good, 22% of them say that the relationship between employees and management at this workplace is neither good nor poor, 9% of them say that the relationship between employees and management at this workplace is poor and rest 7% of them say that the relationship between employees and management at this workplace is very poor.

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13 How satisfied are the managers with the industrial relations arrangements which operate at this workplace? Table: 13 Very satisfied Satisfied Neither satisfied nor dissatisfied Dissatisfied Very dissatisfied Graph: 13 21 39 27 10 3

Interpretation: According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana 21% of them say that the managers are very satisfied with the industrial relations arrangements which operate at this workplace, 39% of them say that the managers are satisfied with the industrial relations arrangements which operate at this workplace, 27% of them say that the managers are neither satisfied nor dissatisfied with the industrial relations arrangements which operate at this workplace, 10% of them say that the managers are dissatisfied with the industrial relations arrangements which operate at this workplace and rest 3% of them say that the managers are very dissatisfied with the industrial relations arrangements which operate at this workplace.

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APPRAISAL AND GRIEVANCE HANDLING

14. According to you the appraisal should be conveyed to employees? Table: 14 Quarterly Half yearly Yearly Graph: 14
34 59 7

INTERPRETATION: From the above data it is evident that the majority of the respondents i.e 34% of them says that the appraisal should be conveyed to employees quarterly, 59% of them say that the appraisal should be conveyed to employees half yearly and rest 7% of them say that the appraisal should be conveyed to employees yearly.
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15. The organization puts in lots of efforts in discovering your potential Training? Table: 15 Strongly agree Agreed Neither agrees nor disagrees Disagree Strongly disagree Graph: 15

through

21 48 27 4 0

INTERPRETATION: According to 100 respondents 21% of them say that they are strongly agree that the organization puts in lots of efforts in discovering their potential, 48% of them say that they are agree that the organization puts in lots of efforts in discovering their potential, 27% of them say that they are neither agrees nor disagrees that the organization puts in lots of efforts in
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discovering their potential and rest 4% of them say that they are disagreee that the organization puts in lots of efforts in discovering their potential

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16. What is the prominent cause of grievance? Table: 16 Wages & salary Working condition Promotion Discipline Graph: 16
35 28 25 12

INTERPRETATION: According to 100 respondents that 35% of them say that the wages and salary is the prominent cause of grievance, 28% of them say that the working condition is the prominent cause of grievance, 25% of them say that promotion is the prominent cause of grievance and rest 12% of them say that discipline is the prominent cause of grievance

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17. Are you satisfied that grievance are being redressed is reasonable period of time? Table: 17 Strongly agree Agreed Neither agree nor disagree Disagree Strongly disagree Graph: 17
31 57 12 0 0

INTERPRETATION: According to 100 respondents 31% of them say that they are strongly agree that they are satisfied that grievance is being redressed is reasonable period of time, 57% of them say that they are agree that they are satisfied that grievance is being redressed is reasonable period of time, and rest 12% of them say that they are neither agree nor disagree that they are satisfied that grievance is being redressed is reasonable period of time
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18. Are you aware of the grievance redressal procedure followed in your organization? Table: 18 Strongly agree Agreed Neither agree nor disagree Disagree Strongly disagree Graph: 18
27 45 20 8 0

INTERPRETATION: From the above data majority of the respondents i.e 27% of them say that they are strongly agree that they are aware of the grievance redressal procedure, 45% of them say that they are agree that they are aware of the grievance redressal procedure, 20% of them say that they are neither agree nor disagree that they are aware of the grievance redressal procedure and

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rest 8% of them say that they are disagree that they are aware of the grievance redressal procedure.

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19. Are you satisfied with the grievance handling policy of your organization is effective? Table: 19 Strongly agree Agreed Neither agree nor disagree Disagree Strongly disagree Graph: 19
29 43 19 9 0

INTERPRETATION: According to 100 respondents 29% of them say that they are strongly agree that they are satisfied with the grievance handling policy of their organization, 43% of them say that they are agree that they are satisfied with the grievance handling policy of their organization, 19% of them say that they are neither agree nor disagree that they are satisfied with the grievance handling policy of their organization and rest 9% of them say that they are disagree that they are satisfied with the grievance handling policy of their organization

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CONCLUSIONS

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CONCLUSIONS

Mostly employees of Nahar Spinning Mills Ltd., Ludhiana say decisions about industrial relations or human resource management is taken by higher authority. The most common shift worked at Nahar Spinning Mills Ltd., Ludhiana is 8-10 hrs Mostly employees of Nahar Spinning Mills Ltd., Ludhiana say yes collective agreement negotiated with a union. Maximum employees of Nahar Spinning Mills Ltd., Ludhiana say that the relationship between management and union is very good. Mostly overtime bans, restrictions and work to rule or go slow. Maximum employees of Nahar Spinning Mills Ltd., Ludhiana say that Health and Safety issues and Management decisions or proposals are the most common reasons for the industrial action, or actions, at this workplace over the past year.

Mostly employees of Nahar Spinning Mills Ltd., Ludhiana the last year the majority of your non-managerial employees entitled to a higher rate of pay when they work overtime and Performance related pay component.

According to 100 employees of Nahar Spinning Mills Ltd., Ludhiana mostly employees say that the labor cost of this workplace has increased. Mostly employees of Nahar Spinning Mills Ltd., Ludhiana the productivity at this workplace has increased. Maximum employees say that the management intentionally reduced the size of the workforce at this workplace at any time in the last year. According to the employees of Nahar Spinning Mills Ltd., Ludhiana the organizational restructuring and the financial problems or difficulties are the reasons for this reduction on the last occasion.

According to employees of Nahar Spinning Mills Ltd., Ludhiana the relationship between employees and management at the workplace is very good. According to employees of Nahar Spinning Mills Ltd., Ludhiana the managers are satisfied with the industrial relations arrangements which operate at this workplace.

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SUGGESTIONS AND RECOMMENDATIONS

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SUGGESTIONS AND RECOMMENDATIONS

My survey has given me an opportunity to bring out the human problems and to express their feelings, fears, doubts and dissatisfactions among the minds of the employees regarding industrial relations. So, on the basis of their discontentments there are some suggestions and recommendations on my part that the companies could think over it and take some correct actions regarding their operations.

The company should try to enhance the availability of their services towards their employees. The company should have to take care regarding the work shift at workplace so that employees dont get exhausted. Company should have to take in account that collective agreements should have to be negotiated with the union. Relationship between management and union should have to be at its best to avoid any kind of strike or ban. The Company has to make balance between the workplace labour costs and productivity. The company should have to management the relation between employees and management for their satisfaction.

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LIMITATIONS

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LIMITATIONS
Every project has its own limitations. The purpose of mentioning is to help readers form a more accurate interpretation of the results. Present study is subject to the following limitations which would be taken into consideration. Employees of the plant are so busy in their work that they are not able to give proper times regarding the discussions of my project. Due to time constraints, the size of the sample was restricted. It may not be possible to generalize the results on the basis of such small sample size. Some employees are highly loyal and satisfied towards the organization due to some specific reason as some employees being the member of canteen committee, one being sports coordinator etc. As the matter of which the results obtained may be bias. Covering each and every benefit of the organization is not possible for the survey and discussing each and every aspect of the questionnaire to everyone has also become the part of limitation of the study.

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WHAT I HAVE LEARNT ?

I have discovered that human resource is the heart of every organization. Productivity of any organization is directly related to the quality of HR it contains. All the organizations have also realized the importance of human resource and they have also realized that their growth and industrial relations has an effect on the companys bottom line. In my training I have learnt a lot of things, which will surely help me in my future. The first thing is the skill of communication and they have also developed confidence thereby taking interviews of well experienced people of the organization. This has made me bold to handle the situations accordingly. This training has given me practical exposure to the corporate world which I could never had obtained by sitting in a classroom. We have learnt the methods the organization is applying to motivate and empower their employees towards industrial relations. I got the opportunity to interact with the number of people from the corporate world which developed in me the spirit of being one of them. Last but not the least I had a lifetime experience.

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BIBLIOGRAPHY

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BIBLIOGRAPHY
BOOKS AND JOURNALS

Armingeon, Klaus. 1994. Staat und Arbeitsbeziehungen: ein internationaler Vergleich. Opladen, Westdeutscher Verlag, 1994. Bray, Mark and Haworth, Nigel. 1993. Economic Restructuring and Industrial Relations in Australia and New Zealand. Sydney: Australian Centre for Industrial Relations research and Teaching. Monograph no. 8.

Bhattacherjee, Debashish. (2001). Paper Prepared for the ILO Conference on Trade Unions and Globalization to be held at Geneva, 19-21 April 2001. DeSousa, Valerian. 1999. Colonialism and Industrial Relations in India., The Insititutionalization of Industrial Relations in Developing Nations. The Organizational Behavior and Industrial Relations Research Series. Edited by Sarosh Kuruvilla and Bryan Mundell. Stamford, CT: Jai Press.

Erickson, Christopher L. and Sarosh Kuruvilla. 1995. "Critical Junctures in the Transformation of Industrial Relations Systems." Paper Presented at the Third Bargaining Conference, Toronto, May 1995.

Golden, Miriam A. and Michael Wallerstein, and Peter Lange. 1997. "Unions, Employer Associations, and Wage-Setting Institutions in Northern and Central Europe, 1950-1992. Industrial and Labor Relations Review, 50, No. 3 (April) pp. 379-401. Gordon, Andrew. 1985. The Evolution of Labor Relations in Japan: Heavy Industry, 1853-1955. Cambridge, MA: Harvard University Press.

Katz, Harry C. 1993. The Decentralization of Collective Bargaining: A Literature Review and Comparative Analysis. Industrial and Labor Relations Review, 47, no. 1 (October). Katz, Harry C., Sarosh Kuruvilla and Lowell Turner. 1994. Trade Unions and Collective Bargaining. In Impediments to Competitive Labor Markets: An Overview of Policy and Research Issues. Washington D.C.: The World Bank.

Kuruvilla, Sarosh and Rodney Chua. 1999 . How Do Nations Upskill their Workforces? The Case of Singapore. Global Business Review, 1, no. 1. 1-30. Kuruvilla, Sarosh and C. S. Venkataratnam. 1996. Economic Development and Industrial Relations: The Case of South and Southeast Asia. Industrial Relations Journal, 27. No. 1 pp.9-23.
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Locke, Richard M. 1996. Remaking the Italian Economy. Ithaca: Cornell University Press. Macaraya, B and Ofreneo, R. 1993. Structural Adjustment and Industrial Relations in the Philippines. Paper presented at the Conference on Industrial Relations, September 1993, University of New South Wales, Sydney.

Mathur, Ajeet. 1993. The Experience of Consultation during Structural Adjustment in India (1990-1992). International Labor Review, 132 no. 3 pp. 331-345. Sodhi, J.S. 1993. New Economic Policies and their Impact on Industrial Relations. Indian Journal of Industrial Relations, 29. no. 1 (July) pp 31-54. Venkataratnam, C.S. 1993. Impact of New Economic Policies on the Role of Trade Unions. Indian Journal of Industrial Relations, 29, no. 1 (July) pp. 56--77. Venkataratnam, C.S. 1997. Overview: Globalization and Labor Management Relations in South Asia.

Labour & Industrial Relations, 2000 by Satish Tiwari Employment Relations in Non-union Firms, by Tony Dundon, Derek Rollinson. 187 pgs. The Transformation of American Industrial Relations, in Industrial & Labor Relations Review by Thomas A. Kochan, Harry C. Katz, Robert B. McKersie. 17 pgs.

INTERNET RESOURCES
http://www.owmnahar.in/nsm.html

http://www.nseindia.com/content/corporate/NAHARSPING_base.pdf http://money.rediff.com/companies/nahar-spinning-mills-ltd/16080002

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ANNEXURE

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ANNEXURE: QUESTIONNAIRE
Name: ___________________________________ Designation: __________________ MANAGING IR/HR 1. Who has main responsibility for making decisions about industrial relations or human resource management which apply to this workplace? a) yourself, or b) Senior c) Supervisor d) Higher Authority WORKING 2. What is the length of the most common shift worked at this workplace? a) 5-8 Hours b) 8-10 Hours c) More Than 10 Hours INDUSTRIAL ACTIONS AND UNION 3. Was that collective agreement negotiated with a union? a) Yes b) No 4. How would you rate overall the relationship between management and unions at this workplace? a) Very good b) Good c) Neither good nor poor d) Poor e) Very poor

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5. Have any of the following taken place at this workplace in the last year? a) Strikes or picketing b) Stop work meetings c) Overtime bans, restrictions, work to rule or go slows d) Other bans 6. What have been the most common reasons for the industrial action, or actions, at this workplace over the past year? ACCEPT MULTIPLES a) Negotiations over a enterprise agreement b) Outsourcing, use of contractors or labour hire c) Health and Safety issues d) Implementation /interpretation of agreement/award e) Dismissal, discipline f) Management decisions or proposals g) Industry or state wide issue h) Redundancy i) Other: . . . . . . . . . . . WAGES AND ENTITLEMENTS 7. During the last year, which of the following were the majority of your non-managerial employees entitled to? a) a higher rate of pay when they work overtime b) penalty rates when they work on weekends c) paid maternity leave d) annual leave loadings e) performance related pay component f) annualised salary g) paying out accrued holidays h) paying out accrued sick leave i) rostered days off

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PROFIT, COSTS AND PRODUCTIVITY 8. Compared to a year ago, have the labour costs of this workplace increased, decreased or stayed the same? a) increased b) decreased c) stayed the same d) dont know 9. Compared to a year ago, has productivity at this workplace increased, decreased or stayed the same? a) increased b) decreased c) stayed the same d) dont know WORKFORCE REDUCTIONS & ADDITIONS 10. Has management intentionally reduced the size of the workforce at this workplace at any time in the last year? a) Yes b) No 11. What was the reason or reasons for this reduction on the last occasion? ACCEPT MULTIPLES a) Lack of demand for the product or service b) Technological change c) Organisational restructuring d) Financial problems or difficulties e) To decrease costs or increase efficiency f) Other: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . g) Dont know

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ATTITUDES OF MANAGEMENT 12. How would you rate the relationship between employees and management at this workplace? a) Very good b) Good c) Neither good nor poor d) Poor e) Very poor 13. How satisfied are the managers with the industrial relations arrangements which operate at this workplace? a) Very satisfied b) Satisfied c) Neither satisfied nor dissatisfied d) Dissatisfied e) Very dissatisfied APPRAISAL AND GRIEVANCE HANDLING 10. According to you the appraisal should be conveyed to employees? a) Quarterly b) Half yearly c) Yearly

11 . The organization puts in lots of efforts in discovering your potential Training? a) Strongly agree b) Agreed c) Neither agree nor disagree d) Disagree e) Strongly disagree

through

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12. Do training needs can be identified with think the helpful performance appraisal? a) Strongly agree b) Agreed c) Neither agree nor disagree d) Disagree e) Strongly disagree

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13. What is the prominent cause of grievance? a) Wages & salary b) Working condition c) Promotion d) Discipline

14. Are you satisfied that grievance are being redressed is reasonable period of time? a) Strongly agree b) Agreed c) Neither agree nor disagree d) Disagree e) Strongly disagree

15. Are you aware of the grievance redressal procedure followed in your organization? a) Strongly agree b) Agreed c) Neither agree nor disagree d) Disagree e) Strongly disagree

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