History And Background Of Industrial Relations Management Essay

Today economic crisis is in a bad shape because of an American insolvent United States banking system. It has resulted in the collapse of large financial institutions, the bailout of banks by national governments and downturns in stock markets around the world and led to a huge unemployment rate.

Three top economists agree 2009 worst financial crisis since great depression; risks increase if right steps are not taken. (2009-2-29). Reuters. Retrieved 2009-9-30, from Business Wire News database


Industrial relations are also called employment relations in this text deals primarily with employee attitudes and behaviour and the relationships between an organisation and its employees. If relationships are characterised by open communication, fair and equitable. HR policies and practices, and high work and life satisfaction, there will be trust, cooperation, commitment and high performance. However, if they are characterised by poor communication, unfair and discriminatory HR policies and practices, and low work and life satisfaction, there will be conflict, mistrust, low commitment and poor performance. Industrial relation traditionally takes a broader perspective, involving governments, industrial tribunals, employer associations, trade unions, industrial law, awards, terns and conditions of work, grievance procedures, dispute settlement, advocacy and collective bargaining.

The other objectives/importance of the industrial relationship:

To safeguard the interests of labour as well as of management by securing the highest level of mutual understanding and goodwill between all sections in industry which take part in the process of production?

To avoid industrial conflicts and develop harmonious relations, which are essential for the productive efficiency of workers and the industrial progress of the country.

To raise productivity to a higher level in an era of full employment by reducing the tendency to higher and frequent absenteeism.

To establish and maintain industrial democracy based on labour partnership, not only for the purpose of sharing the gains of organization but also participating in management decisions that the individuals’ personality may be fully developed and he may grow into a civilized citizen of the country.

To bring down strikes, lockouts by proving better and reasonable wages and fringe benefits to the workers and improved living conditions.


Industrial relations got its roots in the industrial revolution and the spread of capitalism which created the modern employment relationship by spawning free labour markets and large-scale industrial organizations with thousands of wage workers. Kaufman, the Global Evolution of Industrial Relations .As both societies wrestled with these massive economic and social changes, labour problems arose. Low wages, long working hours, monotonous and dangerous work, and abusive supervisory practices led to high employee turnover, violent strikes, and the threat of social instability and due to confluence of these event and ideas associated with rise of democratic governments in the western world of the late nineteenth and twentieth centuries. It emerged from both negative and positive impulses

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The negative aspect, industrial relations was a reaction against deplorable working condition and with unrepressed profit making and employee clout in the nine teeth century and twentieth century capitalism and this led to the deplorable situations a conflict between capital and labour and hardship for employee of that time

So we come to the conclusion that industrial relation was part of the reform wing. Industrial relations arose from the conviction that cordial relationship between workers and employer could be improvised through a combination of scientific discovery, education, legal reform…..

Current situation

Therefore, the maintenance of a good human relationship is a must in today business environment, because in case of its absence the organizational structure may crumble. Employees constitute the most valuable assets of any organization. Any neglect of the important factor is likely to result in increased cost of production in term of wage and salaries, benefits and services; working conditions, increased labour turn-over, absenteeism, indiscipline and cleavages, strikes and transfer on the ground of discontent and the like, besides deterioration in the quality of the goods produced and strained relations between labour and management.

The Germans practice co-determination which gives workers of the organization representation at the management of the companies these known as the law allows workers to elect representatives (usually trade union representatives) for the supervisory board of directors.

It could be break down to two parts

Workplace representation

Works councils provide representation for employees at the workplace and they have substantial powers – extending to an effective right of veto on some issues. Although not formally union bodies, union members normally play a key role within them.

There is a clear legal basis in Germany for the workplace representation of employees in all but the very smallest companies. Under the Works Constitution Act, first passed in 1952 and subsequently amended, most recently in 2001, a works council can be set up in all private sector workplaces with at least five employees.

The United Kingdom doesn’t practice co-determination so don’t normally involve themselves with running of business but which could be subject to change due to European union invention

There is no Common structure for employee representation in the United Kingdom. Unions are the for the most part the general way that employees are represented and they can now legally oblige the employer to deal with them, but only if they have ample support and union recognition (legal body)

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Board-level Representation

In Germany employee representatives have a right to seats on the supervisory board of larger companies one-third in companies with 500 to 2,000 employees, half in companies with more than 2,000.

It reviews its performance. It gives advice, participates in setting the company’s strategy and is provided with financial and other information and can veto on issues however there is an exception in other industries such as steel industries

UK employees have no statutory right to representation at board level and, with a tiny handful of exceptions; this has also been the case in practice.

There is no general right for any employee representatives to participate at board level. The handful of experiments with employee representatives at board level in state

Vocational training

Prepares learners for jobs that are based in manual or practical activities, traditionally non-academic and totally related to a specific trade, occupation or vocation, hence the term, in which the learner participates. It is sometimes referred to as technical education, as the learner directly develops expertise in a particular group of techniques or technology.

Finally, most companies in the UK and the US do not offer general initial vocational training. In contrast, almost all medium and large sized. in Germany actively participate in this country’s dual system of initial vocational training. This training, which normally has three year duration, combines on- and off-the-job training and off-the-job training in vocational schools. The German system of initial vocational training is highly regulated and thus reduces organizational autonomy. It also provides general skills rather than company-specific skills

Healthy and Safety

In Germany any business with more than 20 employees, safety officers must be appointed by the employer.

Health and safety is regulated by the 1973 Occupational Health and Safety Act ( Arbeitssicherheitsgesetz), amended in 1976, and the 1996 Occupational Safety Act ( Arbeitsschutzgesetz).

Works councils play an important role in health and safety. In particular they are consulted on the appointment of safety officers ( Sicherheitsbeauftragte). These must help the employer in the prevention of accidents at work and ensure effective implementation of statutory and regulatory health and safety provisions.

In any undertaking with more than 20 employees, safety officers must be appointed by the employer.

In undertakings with more than three safety officers, the management must arrange a briefing meeting at least once a month. The minimum number of safety officers is set by the rules of the occupational accident insurance funds ( Berufsgenossenschaften), depending on the size of the undertaking and the type of risks.

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A health and safety committee must be set up in all undertakings where there is an occupational physician or safety specialist.

This committee consists of the occupational physician(s) or industrial safety specialist(s), the safety officer(s) (and where there are more than three of the latter, they appoint three representatives to the committee), the employer and two representatives of the works council. The committee has an advisory role on measures aimed at improving safety at work or the prevention of industrial accidents.

In undertakings not employing an occupational physician or safety specialist, a safety committee ( Sicherheitsausschuss) must be set up if more than three safety officers have been appointed. The employer must hold an exchange of views with this committee at least once a month, with the participation of the works council

United kingdom

The Safety Representatives and Safety Committees Regulations, adopted in 1977, provide that if the employer recognises a trade union and if that union has appointed or plans to appoint safety reps, the employer must consult those safety reps on issues affecting the group or groups of workers they represent, which may include non-unionised workers

The framework of health and safety legislation is the 1974 Act, subsequently supplemented by various regulations. Health and safety information for employees is governed by a 1989 Regulation. The Safety Representatives and Safety Committees Regulations were passed in 1977, implementing the 1974 Health and Safety at Work Act.

The Safety Representatives and Safety Committees Regulations, adopted in 1977, provide that if the employer recognises a trade union and if that union has appointed or plans to appoint safety reps, the employer must consult those safety reps on issues affecting the group or groups of workers they represent, which may include non-unionised workers. There is no provision on the number of reps in relation to the number of workers in the undertaking, and practice varies considerably from one undertaking to another.

The Health and Safety (Consultation with Employees) Regulations of 1996 (HSCER) provide that workers not forming part of a group represented by safety reps, in other words by trade union representatives, must be consulted by the employer. The employer may consult them directly using such method as he/she sees fit. They may also be consulted via representatives who must be elected by the workers.

Safety committees must be set up wherever at least two safety reps so request. These committees are joint bodies with the principal function of monitoring measures adopted to ensure occupational health and safety. The 1977 SRSCR say very little about the role, composition and operation of safety committees.


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