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Module I (6 Hours)
Introduction, meaning and significance of HRM. Historical evolution of HRM. Major functions
of HRM. Line functions and staff functions. Principles of HRM. HR Competencies. Institutions
of repute which impart HRM education in India. Professional Associations in HRM. Career
opportunities in HRM.

Module II (6 Hours)
Pre-recruitment functions of HRM- Organizational structure, Job analysis, HR Planning and
budget approval. Strategic decision to outsource, engage contract workers or to recruit people on
company role.

Module III (8 Hours)
Recruitment, selection and appointment: Meaning and significance of recruitment, process of
recruitment, sources of recruitment, cost-benefit analysis of recruitment. Meaning and
significance of selection, process of selection, selection techniques- tests, interviews and salary
negotiation. Meaning and significance of appointment, process of appointment, legal aspects of
employment contract, joining formalities and induction.

Module IV (8 Hours)
Training and development: Meaning and significance of training and development, Process of
training development, needs analysis, training design, training implementation and training
evaluation. Methods of training on the job methods and off the job methods.

Module V (6 Hours)
Compensation and benefits: Meaning and significance of compensation and benefits. Basic
salary, allowances, incentives, perks, and benefits. Structured pay scales of the government
sector and cost to company approach of the private consultant. Statutory aspects of compensation
and benefits.

Module VI (8 Hours)
Performance management: Meaning and significance of performance management. Process of
performance management. Types of performance appraisal system. Performance goal setting,
Performance coaching and monitoring, performance evaluation and performance feedback.
Aligning performance outcome to career and succession planning.

Module VII (8 Hours)
Employee Relations: Meaning and significance of employee relations. Employee relation in
unionized and non-unionized organizations. Handling employee grievances. Employee discipline
and domestic enquiry. Legal aspects of employee relations with reference to trade union Act,
industrial employment standing orders Act and Industrial Disputes Act. Statutory aspects of
health, welfare and safety of employees.



Module VIII (6 Hours)
Career and succession planning: Meaning, significance and process of career planning. Career
stages, responsibility for career planning and career anchors. Meaning, significance and process
of succession planning. Continuity of leadership and its impact on business.

1. Essentials of Human Resource Management and Industrial Relations P Subba Rao, HPH.
2. Human Resource Management - Seema Sanghi, Macmillan, 2011.
3. Human Resource Management - Cynthia D. Fisher, 1/e, CengageLearning..
4. Human Resource Management - Biswajeet Pattanayak, 3/e, PHI.
5. Human Resources Management: A South Asian Perspective, Snell,Bohlander, & Vohra,
Cengage Learning, 16th Rep., 2012.
6. Human Resource Management - Lawrence S. Kleeman, Biztantra ,2012.
7. A Text Book of Human Resource Management Dwivedi R. S,Vikas Publishing House.
8. Human Resource Management Rao V. S. P, Excel Books, 2010.

1. Human Resource Management - John M. Ivancevich, 10/e, McGrawHill.
2. Human Resource Management in practice - Srinivas R. Kandula,PHI, 2009
3. Managing Human Resources - Luis R Gomez-Mejia, David B.Balkin, Robert L. Cardy,
6/e,PHI, 2010.
4. Human Resource Management - David A. Decenzo, Stephen P.Robbins, 10/e, Wiley IndiaPvt.
Ltd., 2011.
5. Personnel Management Memoria, HPH.




Modules Page Numbers


Module I (6 Hours)

People with required skills to make an organization to achieve the set goal & targets. HRM is all
about how to induce people to make an organization by
Getting the people who can make an organization.
Enabling those people to acquire required capabilities to make a successful organization.
Motivating them to contribute their resources continuously for running the organisation


The field of Management which has to do with planning, organising, directing and controlling
the functions of procuring, developing, maintaining and utilizing a labour force, such that the
a) Objectives for which the company is established are attained economically and
b) Objectives of all levels of personnel are served to the highest possible degree and
c) Objectives of society are considered and served.-Michael J. Juclus

Significance of HRM

People are the most important asset of any organization . HRM is an important strategic
tool for an organization. It helps to establish on oraganisations sustainable competitive
Human Resources are critical for effective oraganisational functioning. Poor human
resource planning can result in spurts of hiring followed by lay-offs which will result high
training expenses, high lay-off costs and low employee morale. Haphazard compensation
systems do not attract, keep and motivate good employees. Also it is not enough to acquire good
and competent people but also train and develop them, provide them a proper career and provide
job satisfaction and adequate compensation to retain them in the organization for a long term.
Because of its importance, responsibility for HR activities is shared between HR
Department and line managers. For instance, the HR department may recruit and initially screen
the job candidates, but the final selection is made by departmental managers under whom the
new employees will work. Also HR department may establish performance appraisal policies
and procedures, but the actual evaluating and coaching of employees is done by their the
managers and immediate supervisors.

Historical evolution of HRM

The history of personnel management begins around the end of the 19th century, when welfare
officers (sometimes called welfare secretaries) came into being. They were women and
concerned only with the protection of women and girls. Their creation was a reaction to the
harshness of industrial conditions, coupled with pressures arising from the extension of the
franchise, the influence of trade unions and the labour movement, and the campaigning of
enlightened employers, often Quakers, for what was called industrial betterment. As the role


grew there was some tension between the aim of moral protection of women and children and the
needs for higher output.
The First World War accelerated change in the development of personnel management, with
women being recruited in large numbers to fill the gaps left by men going to fight, which in turn
meant reaching agreement with trade unions (often after bitter disputes) about dilution
accepting unskilled women into craftsmens jobs and changing manning levels.
During the 1920s, jobs with the titles of labour manager or employment manager came into
being in the engineering industry and other industries where there were large factories, to handle
absence, recruitment, dismissal and queries over bonuses and so on. Employers federations,
particularly in engineering and shipbuilding, negotiated national pay rates with the unions, but
there were local and district variations and there was plenty of scope for disputes.
During the 1930s, with the economy beginning to pick up, big corporations in these newer
sectors saw value in improving employee benefits as a way of recruiting, retaining and
motivating employees. But older industries such as textiles, mining and shipbuilding which were
hit by the worldwide recession did not adopt new techniques, seeing no need to do so because
they had no difficulty in recruiting labour.
The Second World War brought about welfare and personnel work on a full-time basis at all
establishments producing war materials because an expanded Ministry of Labour and National
Service insisted on it, just as the Government had insisted on welfare workers in munitions
factories in the previous conflict. The government saw specialist personnel management as part
of the drive for greater efficiency and the number of people in the personnel function grew
substantially; there were around 5,300 in 1943.
By 1945, employment management and welfare work had become integrated under the broad
term personnel management. Experience of the war had shown that output and productivity
could be influenced by employment policies. The role of the personnel function in wartime had
been largely that of implementing the rules demanded by large-scale, state-governed production,
and thus the image of an emerging profession was very much a bureaucratic one.
Following the development of poor industrial relations during the 1960s a Royal Commission
under Lord Donovan was set up. Reporting in 1968
, it was critical of both employers and
unions; personnel managers were criticised for lacking negotiation skills and failing to plan
industrial relations strategies. At least in part, Donovan suggested, these deficiencies were a
consequence of managements failure to give personnel management sufficiently high priority.
In the 1960s and 70s employment started to develop significantly. At the same time personnel
techniques developed using theories from the social sciences about motivation and organisational
behaviour; selection testing became more widely used, and management training expanded.
During the 1970s, specialisms started to develop, with reward and resourcing, for example, being
addressed as separate issues.
Around the mid-80s, the term human resource management arrived from the USA. The term
human resources is an interesting one: it seemed to suggest that employees were an asset or


resource-like machines, but at the same time HR also appeared to emphasise employee
commitment and motivation.
Todays HR profession encompasses a number of specialist disciplines, including diversity,
reward (including compensation, benefits, pensions), resourcing, employee relations,
organisation development and design, and learning and development (the history of which is
covered in detail in the next section of this factsheet). Most recently, in developing
the Profession Map, the CIPD has defined ten professional areas covered by the HR profession.
Milestones in the Development of Human Resource Management
Frederick Taylor develops his ideas on scientific management. Taylor advocates
scientific selection of workers based on qualifications and also argues for incentive-
based compensation systems to motivate employees.

Many companies establish departments devoted to maintaining the welfare of workers.
The discipline of industrial psychology begins to develop. Industrial psychology, along
with the advent of World War I, leads to advancements in employment testing and

The interpretation of the Hawthorne Studies' begins to have an impact on management
thought and practice. Greater emphasis is placed on the social and informal aspects of
the workplace affecting worker productivity. Increasing the job satisfaction of workers
is cited as a means to increase their productivity.

In the U.S., a tremendous surge in union membership between 1935 and 1950 leads to a
greater emphasis on collective bargaining and labor relations within personnel
management. Compensation and benefits administration also increase in importance as
unions negotiate paid vacations, paid holidays, and insurance coverage.

The Civil Rights movement in the U.S. reaches its apex with passage of the Civil Rights
Act of 1964. The personnel function is dramatically affected by Title VII of the CRA,
which prohibits discrimination on the basis of race, color, sex, religion, and national
origin. In the years following the passage of the CRA, equal employment opportunity
and affirmative action become key human resource management responsibilities.


Three trends dramatically impact HRM. The first is the increasing diversity of the labor
force, in terms of age, gender, race, and ethnicity. HRM concerns evolve from EEO and
affirmative action to "managing diversity." A second trend is the globalization of
business and the accompanying technological revolution. These factors have led to
dramatic changes in transportation, communication, and labor markets. The third trend,
which is related to the first two, is the focus on HRM as a "strategic" function. HRM
concerns and concepts must be integrated into the overall strategic planning of the firm
in order to cope with rapid change, intense competition, and pressure for increased
Major functions of HRM
Line Functions /ma n a g e r i a l f u n c t i o n s o f h r m
1. Planning: Research and plan about wage trends, labour market conditions, union
demands and other personnel benefits. Forecasting manpower needs etc.
2. Organizing: Organizing manpower for the achievement of organizational goals and
3. Staffing: Recruitment & Selection
4. Directing: Issuance of orders and instructions, providing guidance and motivation to
managers and employees.
5. Controlling: Regulating personnel activities and policies according to plans.
Observations and comparisons of deviations

Staff functions./O P E R A T I O N A L F U N C T I O N S O F H R M
1. Procurement: Planning, Recruitment and Selection, Induction and Placement
2. Development: Training, Development, Career planning and counselling.
3. Compensation: Wage and Salary determination and administration
4. I ntegration: Integration of human resources with organization.
5. Maintenance: Sustaining and improving working conditions, retentions, employee
6. Separations: Managing separations caused by resignations, terminations, layoffs, death,
medical sickness etc.

Principles of HRM

Principles of Human Resources Management have been well summarized in 10Cs.
Comprehensiveness. This involves the proper management of all aspects of the people you are
working with bearing in mind that human resources is the most valuable resource your firm has.


This means that the financial, health, transportation, tools and anything employees need to
work should be well taken care of.

Cost-effectiveness. Companies should ensure that they remunerate their employees accordingly.
The employees reward system should be able to sustain the organization.

Control. Firms should be able to take charge of their employees and ensure that productivity and
quality is achieved and maintained. Control should be exercised carefully so that it does not seem
like tyranny.

Coherence. All the steps taken by a firm in the management of human resources must be in line
with the mission and vision of the firm. Human Resources managers should direct their focus on
what the company needs and employee abilities.

Communication is very important in every organization. Through communication, firms can
ensure there is flow of information that is necessary for efficiency.

Creativity is key if a firm is to be efficient in human resources management. Firms should adopt
new ways of human resources management as long as it fits their companies.

Competence. It is an organizations responsibility to ensure that their employees are skilled to do
their duties. Because the competence of a firm depends on that of its employees, firms should do
everything to increase employee capabilities for example, by training them.

Credibility. Firms must ensure that they remain the best brand to most of their clients by
maintaining their credibility. They should put in place strategies that ensure all employees have a
clear sense of direction to a common goal.

Change is inevitable for businesses. The fastest business to embrace change in management
of their human resources is better placed to produce better results.

Commitment. Every organization has objectives which they intend to meet both for themselves
and for their clients. To meet these goals, firms need committed staff therefore it is the firms
responsibility to keep their employees motivated so as to ensure they are committed to the
organizations course.

HR Competencies

Credible activist
HR professionals in high-performing firms function as credible activists. They do what they say
thay will do. Such results-based integrity serves as the foundation of personal trust that, in turn,
translates into professional credibility. They have effective interpersonal skills. They are flexible
in developing positive chemistry with key stakeholders. They translate this positive chemistry
into influence that contributes to business results. They take strong positions about business
issues that are grounded in sound data and thoughtful opinions.


Strategic positioner
High-performing HR professionals understand the global business context the social, political,
economic, environmental, technological, and demographic trends that bear on their business
and translate these trends into business implications. They understand the structure and logic of
their own industries and the underlying competitive dynamics of the markets they serve,
including customer, competitor, and supplier trends. They then apply this knowledge in
developing a personal vision for the future of their own company. They participate in developing
customer-focused business strategies and in translating the business strategy into annual business
plans and goals.
Capability builder
At the organisational level, an effective HR professional creates, audits, and orchestrates an
effective and strong organisation by helping define and build its organisational capabilities.
Capability represents what the organisation is good at and known for. These capabilities outlast
the behavior or performance of any individual manager or system. Such capabilities might
include innovation, speed, customer focus, efficiency, and the creation of meaning and purpose
at work. HR professionals can help line managers create meaning so that the capability of the
organisation reflects the deeper values of the employees.
Change champion
Effective HR professionals develop their organisations capacity for change and then translate
that capacity into effective change processes and structures. They ensure a seamless integration
of change processes that builds sustainable competitive advantage. They build the case for
change based on market and business reality, and they overcome resistance to change by
engaging key stakeholders in key decisions and building their commitment to full
implementation. They sustain change by ensuring the availability of necessary resources
including time, people, capital, and information, and by capturing the lessons of both success and
Human resource innovator and integrator
At an organisational level, a major competency of effective HR professionals is their ability to
innovate and integrate HR practices around a few critical business issues. The challenge is to
make the HR whole more effective than the sum of its parts. High-performing HR professionals
ensure that desired business results are clearly and precisely prioritised, that the necessary
organisation capabilities are powerfully conceptualised and operationalised, and that the
appropriate HR practices, processes, structures, and procedures are aligned to create and sustain
the identified organisational capabilities. As they do so with discipline and consistency, they help
collective HR practices to reach the tipping point of impact on business results. The innovation
and integration of HR practices, processes, and structures, directs HR more fully toward
impacting business results.
Technology proponent
For many years, HR professionals have applied technology to basic HR work. HR information
systems (HRIS) have been applied to enhance the efficiency of HR processes including benefits,
payroll processing, health care funding, record keeping, and other administrative services. In this
HRIS round, we see a dramatic change in the implications of technology for HR professionals.
At the organisation level, high-performing HR professionals are now involved in two additional


categories of technological application. First, HR professionals are applying social networking
technology to help people stay connected with each other. They help guide the connectedness of
people within the firm and the connectedness between people outside firms (especially
customers) with employees inside the firm. Second, in the high-performing firms, HR
professionals are increasing their role in the management of information. This includes
identifying the information that should receive focus, bundling that information into useable
knowledge, leveraging that knowledge into key decisions, and then ensuring that these decision
are clearly communicated and acted upon. This updates the operational efficiency competency
and will add substantive value to their organizations.
Institutions of repute which impart HRM education in India

1. Indian Institute of Management, Ahmedabad (IIM A)
2. Indian Institute of Management, Calcutta (IIM C)
3. Indian Institute of Management, Bangalore (IIM B
4. Indian Institute of Management, Lucknow (IIM L)
5. XLRI - Xavier Labour Research Institute, Jamshedpur
6. ISB - Indian School of Business, Hyderabad
7. FMS - Faculty of Management Studies, University of Delhi
8. Indian Institute of Management, Indore (IIM I)
9. Indian Institute of Management, Calicut (IIM K - Kozhikode)
10. Jamnalal Bajaj Institute of Management Studies, Mumbai (JBIMS)
11. S. P. Jain Institute of Management Studies, Mumbai (SPJIMR)
12. Shailesh J. Mehta School of Management, IIT Mumbai (Bombay)
13. Management Development Institute, Gurgaon (MDI)
14. Narsee Monjee Institute of Management Studies, Mumbai (NMIMS)
15. Xavier Institute of Management, Bhubaneswar (XIM B)

Professional Associations in HRM

Institute of Human Resource
Management of Serbia
Omnibus HR Membership
Asociacin Mexicana en Direccin
de Recursos Humanos
Omnibus HR 12,500
American Society for Healthcare
Human Resources Administration
1964 United
Healthcare 3,350
American Society for Training &
Training and



Institute of Human Resource
Management of Serbia
Omnibus HR Membership
Development United
Chartered Institute of Personnel and
Omnibus HR 135,000
College and University Professional
Association for Human Resources

Colleges and
HR Policy Association

Industry leaders 330
Hong Kong Institute of Human
Resource Management
1977 Hong
Omnibus HR 4,500
Human Resources Professionals
Omnibus HR 18,000
Institute of Recruiters 2010
Recruiting & HR 2,500
International Foundation of
Employee Benefit Plans
1954 United
Total Rewards 35,000
International Public Management
Association for Human Resources
1906 United
Public sector 10,000


Institute of Human Resource
Management of Serbia
Omnibus HR Membership
Labor and Employment Relations
1947 United
Omnibus HR 3,000
National Academy of Human
1992 United
Industry leaders 150
National Association of Personnel
1961 United
Recruiting 700
National Human Resources
1951 United
Omnibus HR 1,500
National Institute of Personnel
1980 India Omnibus HR 11,500
Recognition Professionals
1998 United
Recognition 475
Society for Human Resource
1948 United
Omnibus HR 250,000
WorldatWork 1955 United
Total Rewards 30,000



Career opportunities in HRM

Human resources officer
IT trainer
Occupational psychologist
Recruitment consultant
Training and development officer



MODULE 2(6 Hours)
Pre-recruitment functions of HRM
Organizational structure

Designing Organisational Structure
Organisations are economic and social entities in which a number of persons perform
multifarious tasks in order to attain common goals. Organisations are effective instruments in
that they help individuals accomplish personal objectives that they (persons) cannot achieve
alone. According to Argyris, "organisations are usually formed to satisfy objectives "that can
best be met collectively.

Organisation is only a means to an end. It takes certain inputs from the environment and
converts them into specified outputs desired by the society. Organisation design deals with
structural aspects of organisations: it aims at analysing roles and relationships so that collective
effort can be explicitly
organised to achieve specific ends.

There is significant development in organisation design. Exhibit 1.2 presents these changes.

Exhibit 1.2
1950s 2000s Broad Banding*
Multiple layers Flat/Delayered Few Levels
Manufacturing/Labour Feed forward and Empowerment/
Intensive very less control Ownership
Autocratic Team Focussed Pay the person

Centralised Adaptive/Mobility based on Merit
Tightly held ownership Flexible Horizontal Reinforces
Individual contributors Decentralised Few Rules
Narrow Responsibilities Externally focussed Market Driven

(Adapted: From Saurabh Rastogi, Grades to Bands, Human Capital, October 1998, pp.45-
* Broad banding is a job hierarchy that contains a small number of levels or grades.

Steps in Designing Organisational Structure

The first step in organisation design is analysis of present and future circumstances and
environmental factors. The next stage deals with detailed planning and implementation.
Organisation analysis is the basis for organisation design and is the process of defining aims,
objectives, activities and structure of an enterprise. Organisation analysis includes an analysis of
the following aspects:
(i) External environment economic, political, legal etc.


(ii) Overall aims and purpose of the enterprise - survival, growth, profit
maximisation, wealth maximisation etc.
(iii) Objectives - specific aims or targets to be achieved.
(vi) Activities - assessment of work being done and what needs to be done if the
company is to achieve its objectivities.
(v) Decisions to be taken across horizontal and vertical dimensions.
(vi) Relationships - from the viewpoint of communications.
(vii) Organisation structure - includes grouping of activities, span of management,
management levels etc.
(viii) Job structure - job design, job analysis, job description, job specification etc.
(ix) Organisation climate -working atmosphere of the enterprise. It includes teamwork
and cooperation, commitment, communications, creativity, conflict resolution,
participation, confidence and trust.
(x) Management style - includes laissez-faire, democratic, benevolent - autocratic.
(xi) Human resources - includes availability of human resources marked by skill,
knowledge, commitment, aptitude etc.

Formal relations are divided into line and staff relations and let's look into these
relationships in greater detail in the ensuing sections.

(i) Line and Staff Relationships: The relationship with which the managers in an
organisation deal with one another are broadly classified into two categories, viz., line and
staff. Line and staff are often used in ways that are loose and unclear. Attempts have been
made in some organisations to dispense with them. Thus, operating managers/departments
are frequently substituted for line and auxiliary and service departments are used for staff.
Line and staff are characterised by relationship but not by departments. The important
category of relationships is line relationship.
(ii) Line Relationship: The relationship existing between two managers due to delegation of
authority and responsibility and giving or receiving instructions or orders is called/ine
relationship. Thus, line relationship generally exists between a superior and an subordinate.
Line refers to those positions of an organisation which have responsibility, authority and
are accountable for accomplishment of primary objectives. Managers identified as line are
not subject to command by staff position. In case of disagreement between line and staff,
the line manager has the right to make final operating decisions.

Line authority represents uninterrupted series of authority and responsibility delegating
down the management hierarchy. In other words, the Board of Directors delegates
authority to the managing director who in turn delegates a part of his authority to the
general manager. The general manager in turn delegates part of his authority to different
departmental heads and through them to the supervisors. However, the line managers are
completely responsible and accountable for the results achieved by the employees of the
respective departments and sections. This does mean that though the authority is delegated,
responsibility for action taken by a subordinate still rests with the superior.

The third kind of relationship is staff relationship.



(iii) Staff Relations: The staff concept is probably as old as organisation itself. It is virtually
impossible for busy line managers to perform all their functions and concentrate on all
activities including management of the people in their respective departments. This gives
rise to securing advice and help from specialists. This creates staff relationships. The
relationship between two managers is said to be a staff relation, when it is created due to
giving and taking advice, guidance, information, help or assistance, counselling etc., in the
process of attaining organisational goals.

Thus, staff managers analyse problems, collect information and develop alternative
suggestions and help the line managers to make right decisions quickly. Staff control is
monitoring and reporting, which brings the results of information to the attention of the
line managers for action by the line. Thus, they reduce the work load of the line managers
and allow them to concentrate on their operative issues.

Having discussed two concepts, it would be appropriate to apply the line and staff
relationship to the organisation design.

Line and Staff Relationships in an Organisation
Organisation can also be structured on the basis of line and staff. As discussed earlier, line
and staff are viewed as relationships but not by departments. Some functional managers have
line relations with other managers whilst some other managers have staff relations with other
managers in the organisation as shown in Figure 1.7. But those functional managers having staff
relations may have line

Note denotes line relationship
denotes staff relationship


R & D




relations in relation to the subordinates. Thus, organisation structure is designed on the basis of
line and staff relationship within the departmental structure. It is often regarded that the
personnel manager has staff relation with other managers in an organisation. Now we discuss
line and staff relationship and personnel management in an organisation.

Job analysis
Job analysis is a process in which jobs are studied to determine what tasks and responsibilities
they include, their relationship to other jobs, conditions under which work is performed and the
personal characteristics required for satisfactory performance.

Job analysis consists of two parts, a statement of work to be performed (the job description) and
the skill and knowledge which must be possessed by any one filling the job.

JOB EVALUATION: Job evaluation is the process of
arranging jobs in an organisation in an
hierarchical order of worth and
fixing compensation for each job.

JOB EVALUATION is the process of analysis and assessment of jobs to ascertain reliably
their relative worth using the assessment as a basis for a balanced wage structure.

JOB EVALUATION is a process determining the relative worth of various jobs within the
organisation, so that differential wages may be paid to jobs of different worth.


1 Obtain data & description of each job within
the plant
1 Must be an attempt to rate the job not the
2 Provide a standard procedure for determining
relative worth and value of each job
2 Elements of job slected must be common
to most jobs, few in no, simple, easy to
3 Determine a rate of pay for each job which is
fair equitable with relation to other jobs. In
the plant/ community /industry.
3 Clear definition and consistency of
degree of elements
4 Ensure like wages are paid to all qualified
employees on like work
4 Secure co-operation from supervisors for
job evaluation
5 Promote fair & accurate consideration for all
for an advancement & transfer
5 Secure co-operation & participation from


6 Provide a factual basis for the consideration
of wage rates for similar jobs within the
6 Minimise number of wage rates within
each grade

7 Provide information for the work,
employees selection, training etc

Methods 1) Analyse prepare job description
& procedure 2) Select and prepare a job evaluation plan
of 3) Classify jobs
job evaluation 4) Install the programme
5) Maintain the programme


Job can be analysed through a Process Basic 7 steps

1) Strategies :
a) Extent of employees involvement in job analysis
b) The level of detail of job analysis
c) timing and frequency of job analysis
d) Past oriented Vs Future Oriented job analysis

2) Collection of background information: Organisation charts, class specification & existing
job description

3) Selection of representative position to be analysed: In order to analyse selecting a
representative position.

4) Collection a job description: On features of the job, required employee behavour &
human requirement

5) Developing a job description: Contents of jobs in term of function & operations as given
in job description

6) Developing a job specification: Converting job description into job specification
Describes Personal qualities, traits, skills, knowledge & background for getting job

7) Developing employee specification: Conversion of job specification into employee
specification, which includes, physical qualification, educational qualification,




o Company Strategies

o Collective of information

o Process information

o Drafting job description

o Drafting job specification

Human Resources Planning
Team building
Recruitment & Selection
Training & Development
Career Planning &
Performance analysis &
Job evaluation
Wages & Salary Levels
Discipline & grievances
Work scheduling
Health & Safety

HR Planning and budget approval.

INTRODUCTION: Corporation level strategies include: expansion, diversification,
Mergers, acquisitions & joint ventures, implementation of these strategies demand for additional
Human Resources
Other Strategies Vs Turnaround, retrenchment results in reduction on HRP
Thus, strategies planning is the basis for HRp.
HRP- Manager of a company has to understand the companies strategies and their demand for
HR. Before Planning for HR.

A process by which an organisation should move from its current man power position to its
desired man power position. HRP strives to do selecting right number & right kind of people at
the right place, at the right time, doing things result in both the organisation and the individual
receiving maximum long run benefit.
An integrated approach to performing the planning aspects of the personnel function in
order to have a sufficient supply of adequately developed and motivated people performing the
duties and task required to meet organizational objectives and satisfy individual need & goal of
oragnisation members
Objectives of HRP: Important objectives are:

i) To recruit & retain the human resources of required quantity and quality
ii) To foresee employees turnover and make arrangements for minimizing turnover and
filling up consequent vacancies.
iii) To meet the needs of the programme of expansion, diversification etc
iv) To foresee the impact of technology on work. Existing employees and future human
resources requirements.


v) To improve standards, knowledge, ability, discipline etc
vi) To assess the surplus or shortage of human resources and take measures accordingly
vii) To maintain congenial industrial relations by maintaining optimum level and structure of
human resources.
viii) To minimise imbalances caused due to non-availability of human resources of the right
kind, number in right time and right place.
ix) To make best use of human resources
x) To estimate the cost of human resources.


1) Changes of environment: Uncertainty of future. Environment of organisations changes by
various reasons. Viz. Technology, competitors, better products in the market, new
marketing efforts, etc., HRP to re-train, redeploy, human resources to suit changes in
product mix, technology, distribution etc.

2) Changes in organisations: Organstaional changes due to joint ventures, merger, setting up
international operations needs HRP to re-train & redeploy human resources.

3) Replacement against deficiencies: Replacement due to death, retirement, resignation,
retrenchment, transfer, promotion etc. simple method to meet deficiency is through fresh
recruitment. Others: transfer, promotion, labour contract etc.

4) Employment of surplus manpower : Due to products phase out etc., changes in product
mix/market condition/order position/technology/ capacity/utilization, corporate policy.

In case re-deployment not possible management will have to retrench & layoff/ leave of
absence without pay/reduced work Hrs, early retirement- Golden handshake/non filling
of vacancy.

5) Stability of employment: Matching supply & demand gives better motivation and loyalty
to workers. Sense of security of individual, need is met. Steps to improve stability of
employment are:

Flexible working system meet peak needs by contract labour
Innovative marketing strategy like bonus /seasonal cost reduction
to by sub contracting work to contractors.


Human Resources Planning (HRP) anticipates not only the required kind and number of employees but
also determines the action plan for all the functions of personnel management. The major benefits of
human resources planning are:-
It checks the corporate plan of the organisation.
It offsets uncertainty and change. But the HRP offsets uncertainties and changes to the
maximum extent possible and enables the organisation to have right men at the right time and


in the right place.
It provides scope for advancement and development of employees through training,
development etc.
It helps to anticipate the cost of salary enhancement, better benefits etc.
It helps to anticipate the cost of salary, benefits and all the cost of human resources, facilitating the
formulation of budgets in an organisation.
To foresee the need for redundancy and plan to check it or to provide alternative employment in
consultation with trade unions, other organisations and the government through remodelling
organisational, industrial and economic plans.
To foresee the changes in values, aptitude and attitude of human resources and to change the
techniques of interpersonal management etc.
To plan for physical facilities, working conditions and the volume of fringe benefits like
canteen, schools, hospitals, conveyance, child care centres, quarters, company stores etc.
It gives an idea of the type of tests to be used and interview techniques in
selection based on the level of skills, qualifications, intelligence, values etc.
of future human resources.
It causes the development of various sources of human resources to meet the organisational
It helps to take steps to improve human resources contributions in the form of increased
productivity, sales, turnover etc.
It facilitates the control of all the functions, operations, contribution and
cost of human resources


Process of Human Resources Planning consists of the following steps:
Analysing the corporate and unit level strategies.
Demand Forecasting: Forecasting the overall human resources requirements in accordance
with the organisational plans.
Supply Forecasting: Obtaining the data and information about the present inventory of
human resources and forecast the future changes in the human resources inventory.
Estimating the net human resources requirements.
In case of future surplus, plan for redeployment, retrenchment and lay- off.
In case of future deficit, forecast the future supply of human resources from all sources with
reference to plans of other companies.
Plan for recruitment, development and internal mobility if future supply is more than or equal .o
net human resources requirements.
Plan to modify or adjust the organisational plan if future supply will be inadequate with
reference to future net requirements.
The eight steps of human resources planning are depicted in Fig. 4.2 in the order mentioned
above. But the same order need not be followed in the actual planning process as the steps are
interdependent and sometimes, the first step and the last step may be processed simultaneously.
Further, the planner sometimes may not explicitly process some steps. However, it is helpful to the
planner to plan for human resources effectively without any complications if he/she has an idea
about all steps of HRP. These steps are as shown in the line diagram



Figure 4.2


External Factors
(i) Government Policies: Policies of the government like labour policy, industrial relations
policy, policy towards reserving certain jobs for different communities and sons-of the-soil
etc. affect HRP
(ii) Level of Economic Development: Level of economic development determines the level of
HRD in the country and thereby the supply of human resources in the future in the
(1) Adjust or Modify the Strategies (10)

(2) (3) (4)



(5) (7)

Plan for (6) Plan for (8)

Redeployment Retrenchment/ Out-Sourcing Employment Training Development Internal
Redundancy Mobility

Reduced Lay off VRS Attrition CRS/Iron Hand
Hours Shake

Work Leave of Golden Hand
Sharing Absence Shake
without pay
Analysing Corporate
level & Unit Level
Demand Forecast
Skillwise Knowledge
Forecast the Future
Supply Human
Resource in all
Sources if supply is
Supply Forecast
Present Inventory of
Human Resources +
Additions - Losses
Knowledgewise Etc.)

Net Human Resources
Requirements for
Values Etc.,)
Control & review
Surplus of Future
Available Human
Resources within the
Shortage of Future
Available Human
Resource within the


(iii) Business Environment: External business environmental factors influences the volume
and mix of production and thereby the future demand for human resources.
(iv) Information Technology: Information technology brought amazing shifts in the way how
do businesses operate? These shifts include: business process reengineering, enterprise
resources planning and supply chain management. These changes brought unprecedented
reductions in traditional human resources and increase in software specialists. However,
these changes reduced the demand for even software specialists at a latter stage. Added to
this, the computer-aided design (CAD) and computer-aided technology (CAT) also reduced
the existing human resources.
(v) Level of Technology: Level of technology determines the kind of human resources
(vi) International Factors: International factors like the, demand for and supply of human
resources in various countries.

Internal Factors
(i) Company Strategies: Companys policies and strategies relating to expansion,
diversification, alliance etc., determine the human resources demand in terms of quality and
(ii) Human Resource Policies: Human Resources policies of the company regarding quality
of human resources, compensation level, quality of work life etc. influence human
resources plan.
(i) Job Analysis: Fundamentally, human resources plan is based on job analysis. Job
description and job specification. Thus, the job analysis determines the kind employees
(iv) Time Horizons: Companies with a stable competitive environment can plan for the long run
whereas firms with an unstable competitive environment can plan for only short-term range.
(v) Type and Quality of information: Any planning process needs qualitative and accurate
information. This is more so with human resources plan.
(vi) Companys Production/Operation Policy: Companys Policy regarding how much to
produce and how much to buy from outside to prepare a final product, influences the number
and kind of people required.
(vii) Trade Unions: Influence of trade unions regarding the number of working hours per week,
recruitment sources etc. affect HRP.



Factors Affecting Human Resources

Strategic decision to outsource
Outsourcing is best adopted after a careful look at business needs and available options. It is
essential that the outsourcing relationship provides strategic business benefits in the future.
Outsourcing provides a competitive strategy benefit in a number of ways to an organization. It
allows ease of management, reduction in cost, lesser manpower, and frees up internal resources,
Outsourcing can, and frequently does, provide both long- and short-term benefits to companies
that outsource, provided they have a strategic objective for outsourcing. Medium and long-term
gains are best realised by selecting a vendor who brings value to your core business, rather than
one who can provide with the lowest prices,
Strategic outsourcing, on the other hand, is not driven by a problem-solving mentality. Instead,
it is structured so that it is aligned with the companys long-term strategies. The changes that
organizations expect from strategic outsourcing vary and can include anything from
(a) achieving a gain in competitive advantage,
(b) spending more time on those activities that are truly central to the success of the organization,
(c) repositioning the organization in the marketplace, or
Factors Affecting HRP

External Factors Internal Factors

- Government Policies - Strategic of the company
- Level of Economic Development - Human resources Policy
Including future supply of HRs of the company

- Business Environment - Formal & Informal Groups

- Information technology - Job Analysis

- Level of Technology - Time Horizons
- Natural Factors - Type & Quality of Information
Informational Factors - Companys Production
Operation Policy

Trade Unions



(d) achieving a dramatic increase in share price

Engage contract workers or to recruit people on company role

Historically, there is a direct employment relationship between the employee and the employer.
But the challenges of modern business have shaken this tradition by paving the way for
alternative staffing strategies. While some organisations go for outsourcing their work, others
look for contract labour as a solution to staffing problems.

Outsourcing and contract labour are not the same. In outsourcing, the work is given to an
external organisation and it is for that organisation to organise things to get the work done right
from setting up the plant and machinery to managing the human resources.

Whereas in contact labour, the external organisation appoints the people in its role and deploys
them to any organisation. These contract workers will work in the premises under supervision.

How it works

The practice of contract labour is governed by Contract Labour (Regulation and Abolition) Act
1970. While this law is applicable only to worker and supervisory cadre, the practice of contract
employment has spread even to managerial positions.

According to this Act, the organisation which utilises the manpower is called Principal Employer
and the organisation which appoints people in its role and deploys them to the workplace of its
clients is called Labour Contractor.

The Act is applicable to an organisation (principal employer) which utilises twenty or more
contract labour and to a labour contractor who employs twenty or more contract labour in the
preceding twelve months. The principal employer has to obtain the certificate of registration and
the contractor has to obtain license from the labour department of the government to engage
contract labour.

The principal employer pays to the contractor the total amount of salary, allowances and benefits
payable to the contract workers on a monthly basis and the contractor in turn disburses the salary
to contract workers. The contractor also gets his service charges from the principal employer
which is approximately 10 per cent of the salary bill.

While contract labourers work under the supervision of principal employer in his premises, they
do not have employment relation of whatsoever nature with him. Their employer for all purposes
is the labour contractor.

The nature of employment is always temporary for not more than one year duration at a time,
since the contractor cannot assure regular employment on behalf of principal employer. Even if
contract labourers have a grievance or dispute, they have to raise it only with the contractor who
happens to be their employer for all practical purposes.



Why contract labour?

Contract labour today is employed across several sectors and industries right from government
departments to software industries. It is no more confined to worker level jobs, rather there are
scientists, doctors, business managers and chartered accountants working on the roles of a labour

In the government departments, the recruitments are mostly frozen for the past twenty years and
getting the increased work load completed with regular employees is difficult. Hence, the
departments can have contract labourers by showing it as miscellaneous expenses.

While directly hiring temporary employees can create an industrial dispute at a later date for
regularisation of services, this problem can be easily avoided by hiring people through labour

In the profit making multinational manufacturing organisations, the regular workers are highly
unionised, their salaries are high, they are difficult to motivate for increased productivity and get
easily provoked even for smaller issues. Taking disciplinary action for misconduct or terminating
their services to right size the workforce is a lengthy process under the provisions of Industrial
Disputes Act 1947. Hence, more than 50 per cent of the worker category employees in these
organisations are hired through labour contractor.

In the software development organisations (IT companies), brand image of the employer by
ensuring higher salaries and continuous employment is very important to attract and retain
talented people. But all the work they do is not necessarily either of high paying or of
continuous nature.

Hence, they hire the software engineers through the contractor for shorter periods and at lower
salaries, and for all practical purposes they are shown as employees of the contractor. Many of
the IT companies have more number of contract employees and less number of regular

In the research and development organisations, the research projects are tenure-based and
thereafter, the organisation may not get another project or they may get the project which may
require an altogether new skill set. Hence, this sector prefers contract labour.

There is also a universal truth across all sectors that human resource selection techniques are
often failing to produce intended results. In other words, all those who are doing well in the
aptitude test and interview at the time of selection are not found to be best performers on the job.

Hence, many organisations prefer to engage the services of contract employees, watch them on
the job for about six months to one year both for high performance and good behaviour and
thereafter, consider employing them on company roles, by paying one month salary as
recruitment charges to the contractor. Employers also believe that for certain functions like that
of a janitor and security personnel, contract labour is the right solution not only to save on costs
but also to improve efficiency.


Contract workers are generally not unionised, hence, industrial disputes are minimal, salary bills
can be minimised since they can be hired just by paying minimum wages, if there is indiscipline,
they can be sent home immediately by informing the contractor, if there is excess workforce due
to economic recession their services can be withdrawn immediately by informing the contractor.

Contract employees respond positively to incentive schemes since their salaries are low. Contract
employees cannot compromise on productivity, quality, and good behaviour since continuance of
their services depend upon these factors. The historical belief that people are motivated only by
fear and greed is fully true in the case of contract employees. From the employees point of view,
when he cannot find a regular job of the company, he has the option to either join as a consultant
in company roles or become a contract employee.

The cost of employing contract labour is in fact dearer by 10 per cent because of the service
charges payable to the labour contractor. Certain industries like Apparel Manufacturing do not
encourage contract labour because the industry works on thin profit margins and cannot afford to
spend 10 per cent more towards the service charge payable to the labour contractor. Apparel
industries are generally non-unionised and free from industrial disputes.

There is zero tolerance for indiscipline and employees not following norms are forced to exit
immediately. Same is the case with industries owned by powerful politicians. In every
organisation, certain activities are most important which are required to be carried out only by
regular employees.

The advantages of contract employment will back fire if such activities are entrusted to be
carried out by contract employees.



Module 3 (8 Hours)
Recruitment, selection and appointment
Meaning and significance of recruitment
Recruitment is a process of searching for prospective employees and stimulating and
encouraging them to apply for jobs in an organization. FLIPPO
Recruitment is the discovering of potential candidates.

For actual or anticipated organsational vacancies. It is the linking activity bringing together
those with the jobs to fill & those seeking jobs DAVID.

Recruitment is the process to discover the sources of manpower to meet the requirements of
staffing schedule and to employ effective measures for attracting the manpower YODER.

1. Attracts people with multidimensional skills and experience that suits the
present and future organization strategies.
2. Inducts outsiders with a new perspective to lead the company.
3. Infuses fresh blood at all levels of the organization.
4. develops an organizational culture that attracts competent people to the
5. Searches or head hunt people whose skills fit the company.
6. Devises methodologies for assessing psychological Traits.
7. Seeks out non conventional development grounds of talent.
8. searches for talent globally & not just within the company
9. Designs entry pay that competes on quality but not on quantum.
10. Anticipates and find people for positions that do not exist yet.

Process of recruitment
Step 1: I dentify Vacancy and Evaluate Need
Recruitments provide opportunities to departments such as aligning staff skill sets to initiatives
and goals and planning for departmental and individual growth. Although there is work involved
in the hiring process, proper planning and evaluation of the need will lead to hiring the right
person for the role and team.
Conduct a Job Analysis if this position will be new to department. This will also help to
identify gaps.
When attrition occurs, replacing the role is typically the logical step to take. Before obtaining
approval to advertise the position, consider the following:


As with a newly created position, it may be helpful to conduct a Job Analysis in order to
tailor the position to what is currently required and to ensure proper classification. Your
HR Classification Analyst can assist in reviewing and completing.
Review the role and decide if there are any changes required as certain tasks and
responsibilities performed by the previous person may not or should not be performed by
the new person
Carefully evaluate any changes needed for the following:
Level required performing these tasks; considering the appropriate classification level. Be
aware that changes in the classification of positions from represented to non represented
will require union notice and agreement
Tasks carried out by the previous employee
Tasks to be removed or added if any of the work will be transferred within department
Supervisory or lead responsibility
Budget responsibility (if any)
Work hours
Step 2: Develop Position Description
A position description also referred to as a job description is the core of a successful recruitment
process. From the job description, interview questions, interview evaluations and reference
checks questions are developed.
A well-written job description:
Provides a first and sometimes, lasting impression of the campus to the candidate
Clearly articulates responsibilities and qualifications to attract the best suited candidates
Improves retention as turnover is highest with newly hired employees. Employees tend to
be dissatisfied when they are performing duties they were not originally hired to perform.
Provides an opportunity to clearly articulate the value proposition for the role and the
department and helps attract candidates to apply
Optimizes search engine results by ensuring job postings rank highly in candidate search
results when searching on-line
Serves as documentation to help prevent, or defend against, discrimination complaints by
providing written evidence that employment decisions were based on rational business


Identifies tasks, work flow and accountability, enabling the department to plan how it
will operate and grow
Assists in establishing performance objectives
Is used for career planning and training by providing clear distinctions between levels of
responsibilities and competencies required
Is used as a benchmark to assist in ensuring internal and external equity
Identify Duties and Responsibilities
Prior to developing the job description the hiring manager should identify the following:
1. General Information
2. Position Purpose
3. Essential Functions
4. Minimum Requirements
5. Preferred Qualifications
1. General Information
Basic position and pay information will need to be determined to assist with the development of
the job description and job classification and for entering into the ATS. This information will be
different for each position being recruited:
Title Code The Title Code determines the Payroll Title, Personnel Program Code and
Description, and the Bargaining Unit Code and Description fields in the ATS.
Pay Grade/Step
Working Title Market titles should be recognizable and common to various industries
as most job seekers search for commonly referred to market titles when conducting on-
line job searches
Department Name
Department Head
Supervisor Name
Title Codes and Full-Time Equivalent numbers of employees supervised
Special Requirements and Conditions:


o Specific requirements job seekers must possess or complete in order to be hired
(e.g. background check, valid drivers license, etc.)
o BFOQs which are in compliance with UCRs applicable policies (e.g. physical or
mental requirements)
o Contact Staff Employment and Development for assistance with special
requirements and conditions
2. Position Purpose
Describes the departments functions, the units functions, and/or the organizational units
functions. The statement should summarize the positions essential functions and its role in
relation to supporting, administering, or managing the activities of the department, unit, or
organizational unit.
Posted Position Purpose -Includes a description of the role and its relation to the department,
organization and University
Includes the estimated duration for non-Career positions
Lists the number of openings when there is more than one position being recruited
Is written with a marketing angle to attract a talented diverse pool of applicants
Is optimized for search engines
Candidates conduct job searches by entering key words or phrases into search engines.
Most candidates utilize job aggregators such as Google and Indeed versus searching
individual company job posts.
To ensure your position reaches the top of candidate search results, include key words
such as career, job, skills and title of the position in the beginning of the posted
position description (first 150 words).
3. Essential Job Functions
Essential job functions describe the duties and responsibilities of a position. A job function is
considered essential when the performance of the function is the purpose for the position.
Typically, an essential function occupies a significant amount of time of the employees time and
requires specialized skills to perform. By accurately describing the essential functions of the job,
job seekers will have a clear understanding of the role and your expectations for performing
When developing essential functions for the position the following should be noted:


Functions of the job which are critical for the position are arranged by importance and
percentage of time spent
Complexity level and authority for the role should be described to help attract the
appropriate level of qualified candidates
Essential tasks listed should be inter-related to the accomplishment of the essential

4. Minimum Requirements
The minimum requirements or basic qualifications are those qualifications or criteria which
was established in advance and advertised to potential applicants:
Must be relevant and relate back to the duties and responsibilities of the job (e.g., should
not list driving requirement if not part of responsibilities or duties of the job).
Soft skills can be required qualifications (e.g., communication/collaboration) and will:
o Vary among applicants
o Cannot be ascertained in resume
o Able to evaluate in interview
Can be position/department specific (e.g. valid drivers license)
Can be assessed by reviewing the resume
Must be objective, non-comparative and business-related:
should support the accomplishment of the essential function. For example, the essential
function of event planning could require:
o Organizational skills (to ensure all details are cared for)
o Communication skills (to interact with vendors and guests)
o Prior event planning experience
Listing too many skills as requirements significantly limits your applicant pool and selection. A
good rule of thumb is no more than 3-5 required skills depending upon the level of the position.


5. Preferred Qualifications
Preferred qualifications are skills and experience preferred in addition to basic qualifications and
can be used to narrow down the pool of applicants. These preferred skills, knowledge, abilities
and competencies can describe a more proficient level at which the essential functions can be
performed .
Applicants who meet some or all preferred qualifications tend to have shorter assimilation time,
reach full job competence faster and are able to take on advanced responsibilities sooner.

Step 3: Develop Recruitment Plan
Each position requires a documented Recruitment Plan which is approved by the organizational
unit. A carefully structured recruitment plan maps out the strategy for attracting and hiring the
best qualified candidate and helps to ensure an applicant pool which includes women and
underrepresented groups including veterans and individuals with disabilities.
In addition to the positions placement goals the plan contains advertising channels to be used to
achieve those goals. The recruitment plan is typically developed by the hiring manager in
conjunction with the Departmental HR Coordinator. Placement goals identified are entered into
the position requisition in the ATS.
To ensure the most current placement goals are identified for the department and unit,
Recruitment Plan Elements:
A. Posting Period
B. Placement Goals
C. Additional Advertising Resources
D. Diversity Agencies
E. Resume Banks.

Step 4: Select Search Committee
To ensure applicants selected for interview and final consideration are evaluated by more than
one individual to minimize the potential for personal bias, a selection committee is formed. The
hiring manager will identify members who will have direct and indirect interaction with the
applicant in the course of their job. Each hiring manager should make an effort to appoint a
search committee that represents a diverse cross section of the staff. A member of the committee
will be appointed as the Affirmative Action and Compliance Liaison who will monitor the
affirmative action aspects of the search committee. Under-represented groups and women are to
have equal opportunity to serve on search committees and special efforts should be made to
encourage participation. Departments that lack diversity in their own staff should consider
appointing staff outside the department to search committees or develop other alternatives to
broaden the perspective of the committee.
For positions that are frequently recruited and utilize a search committee, the mix of search
committee members should change frequently as well to minimize the risk of group think or
collective bias.


The Hiring Manager will determine the size (no more than 6) and composition of the
committee based on the nature of the position. It is highly recommended the committee
members include:
o At least one individual who has a strong understanding of the role and its
contribution to the department
o A job specialist (technical or functional)
o Staff representative if position has supervisory responsibilities
o An individual who will interact closely with the position and/or serves as a main
Search committee members must ensure no conflict of interest in relation to the
applicants under consideration and must never be individuals who may have interest in
the position

Step 5: Post Position and I mplement Recruitment Plan
Once the position description has been completed, the position can then be posted to the UCR
career site via the ATS. Every effort should be made to ensure the accuracy of the job description
and posting text. It is not advisable and in some instances, not possible to change elements of a
posted position. The reason for this has to do with the impact a given change may have on the
applicant pool.
To post the position:
The requisition is created by the Service Center Human Resources Coordinator or
Departmental Human Resources Coordinator and approved by the Service Center HR
Organizational Coordinator or Organizational HR Coordinator
Once approved, the Departmental HR Coordinator or Service Center will review the
requisition and route online to the HR Classification Analyst who will assign the
The requisition is then routed to the HR Recruitment Analyst who will post the position
Applications can be reviewed once the minimum number of posting days has been
Internal candidates will apply through the regular application process and will be
included in the candidate pool along with external candidates
Talent Sourcing and Outreach


Step 6: Review Applicants and Develop Short List
Once the position has been posted, candidates will apply. Candidates will complete an electronic
applicant for each position (resume and cover letter are optional). Candidates will be considered
Applicants or Expressions of Interest.
All applicants must be reviewed and considered. Applicants are those who apply during the
initial application period as described in Step 5. Candidates who apply after the initial
application period will be considered expressions of interest and not viewable by the search
It is recommended that all search committee members review all Applicants to ensure more than
one person assesses their qualifications and that individual opinion or biases are avoided. Each
committee member may provide comments to each Applicants qualifications as they relate to
the minimum requirements of the position.
If the shortlist is not sufficiently diverse in light of the departments placement goals, will
contact the Search Committee Chair or Chairs Associate to discuss how the pool might be
diversified. One option might be to review the existing applicant pool to evaluate any additional
qualified applicants prior to reviewing applicants who are expressions of interest status. If it is
determined the expressions of interests are to be reviewed, the Search Committee Chair or
Chairs Associate may move those in the expression of interest status to the applicant pool, in
one or more batches on certain date(s) and time(s), as needed to achieve a sufficiently diverse
and qualified pool. All expressions of interest candidates moved to the applicant pool are to be
reviewed by the search committee.

Sources of recruitment,

Recruitment Sources:
Broadly Divided into: a. Traditional Sources
b. Modern Sources
a. Traditional sources are divided in to
a. Internal sources
b. External Sources.



Internal External Internal External

Present Permanent Campus Recruitment Employees Walk in


Employees Referrals
Present Temporary /
Casual Employees
Private Employment
Agencies / Consultants
Reduces cost
And Time
Required for
Consult in
Head Hunting
Body Shaping
Retrenched/ Retired
Public employment
of recruitment
Mergers & Acquisition
Dependents of deceased
disabled Retired & Present
Tele Recruitment
Data Banks Out sourcing
Casual Applicants Hr Supplies on
Temporary or ADHOC
Similar Organization /

Trade Unions.

. Industrial sources: are sources within organisatinal pursuits
. External Sources: Are sources outside organisatinal pursuits.

Used as a Technique of Motivation Suitable candidates with skill,
knowledge and talent etc availability
Morale of Employees can be improved Selection without any preconceived notion or
Internal candidates suitability can be
better judged than external candidates
Cost of Employees reduced since they are put
in the minimum pay scale
Present employees loyalty, commitment,
belongingness, security enhances
Expertise, Experience & Excellence from other
organsiation brought in
An opportunity for advancement of
present employees - A psychological
Human resources mix balanced with different
background, Experience skill
Employees economic needs viz.
Promotion, Higher income, are
Satisfactorily met.
Latest innovations, skills, creativeness, skill developed
in the relevant field flows
Cost of selection can be minimized Existing will broaden their personality
Cost of training, Orientation adaptability to
the organization provided
By inducting quality human resource,
organization stands to get benefited
Trade unions get satisfied.
Tele / E-Recruitment: Benefits are
Low cost per Candidate
Reduction in time for recruitment
Increase in Selection Ratio is more


Candidates per effort
HR professionals can concentrate on strategic
Increased rate of collaboration
among recruiting agencies.
Increased Effectiveness and efficiency
Of recruitment.

Cost-benefit analysis of recruitment.
As seen above internal sources result in economy in the recruitment process.
Also Tele/ E recruitment is a low cost approach
External source cost effective if selected candidates accept minimum of pay scale.

Meaning and significance of selection,

Selection is the process of choosing among the candidates from within the organization or from
the outside, the most suitable person for the current position for the future position Koontz

Objective of selection decision is to choose the individual who can most successfully perform
the job from the pool

Selection of personnel to man the organizations is a crucial complex and
continuing function.
Effective selection programme in an organization will make it to attain its goal effectively &
to develop in a dynamic environment.
If right personnel are selected, employee contribution and commitment will be at optimum
level and employer employee relationship will be congenial. Also Remaining functions of
personnel management become easier.
Similarly a right person is selected, he will be a valuable asset to the organization & a wrong
person will be a liability to the organization.

Process of selection
Selection Procedure is not a single act but is essentially a series o methods or stages by which
different types of information can be gathered through various selection techniques. At each step,
facts may come to light which are useful for comparison with the job requirement &
Employment specifications informations required to be collected are

Candidates qualification . Nature and Behavior
Experience . Knowledge
Physical & Mental ability . Aptitude



Steps in scientific selection procedure / process
(i) Job Analysis
(ii) Recruitment
(iii) Application form
(iv) Written examination
(v) Preliminary Interview
(vi) Business Games
(vii) Tests
(viii) Final interview
(ix) Medical Examination
(x) Reference
(xi) Line managers decision
(xii) Job offer
(xiii) Employment



(ii) (vi)











Job Analysis: Is the basis for selecting the Right candidate. Organisations to finalise, job
analysis, Job description, job specifications, & Employee specifications before proceeding to the
next step of selection
Human Resources Plan: Every company plans for the required number & kind of employees
for a future date. This is the basis for Recruitment function.
Recruitments: Process of searching for prospective employees and stimulating them to apply for
jobs in an organisation. It is the basis for the remaining techniques of the selection.
Development of Bases for selection: To select appropriate candidates from the Applicants pool,
towards this the organisation may borrow / Adopt Techniques/ Bases.
Application Form: A traditional method of securing information from the prospective
candidates also can be used for screening candidates at Preliminary level. Information to be
covered in an Application form is
(i) Personal Background information
(ii) Educational Attainments.
(iii) Work experience
(iv) Salary
(v) Personal details
(vi) References.
Written Examination: Conducted for the qualified candidates after they are screened on the
basis of application blanks enables to make sure the candidates ability in
(i) Aptitude, (ii) Reasoning (iii) Knowledge in various disciplines (iv) General
Knowledge, (v) English Knowledge.

Preliminary Interview:
- To gather necessary information from the prospective applicants and to
assess the applicants suitability to the job.
- Information provided by candidates may be related to job or personal
specifications regarding Education- Experience salary expected aptitude
towards the job- Age Physical Appearance other physical requirements.
- A process useful in eliminating undesirable/unsuitable candidates.
- If candidate satisfy most of the areas of job requirements, he may be
selected for further process.


- Also known as stand-up interviews or screening interviews.
- Also useful in providing basic information about company to candidates
Caution Care to be taken to ensure that desirable ones are not eliminated.
Are widely used as a selection techniques for selecting management
trainees, Managerial personnel at junior, middle & Top positions
Help to evaluate applicants in the areas of
- Decision making
- Identifying the potentialities
- Handling the situation
- Human relations skills etc
Technique Adopted Generally
Participants are placed in a hypothetical work situation and are requested
to play the role situation in the game.
The Hypothesis: The most successful candidates in the game will be the most successful ones on
the job in the selection process.
(i) Case Study : Analytical job general or decision making skills
(ii) Role Play : Human Relations skills
(iii) In-Basket Method: Situational judgment, social relations
(iv) Sensitivity : Degree of openness, concern to others Tolerance
for Individual Differences.
(v) Simulations : Encountering, Situation analysis skills.
Group Discussion: A method where groups of successful applicants are brought around a
conference table and are asked to discuss a case study or a subject matter.
A technique used to secure further information regarding the suitability of the candidate for
the job.
Candidates in the group are required to analyse, discuss and alternative solutions and select a
sound solution.
A selection panel observes the candidates in the areas of


- initiating discussion Explaining the problem,
- Soliciting unrevealing information based on given information and using common sense.
- Keenness to observe discussion of others.
- Clarifying controversial issues Influencing others
- Speaking effectively
-Cconcealing and mediating arguments among the participants and summarizing or
concluding aptly.
- Selection panel, based on the observation judges candidates skills and ranks them
according t heir merit.
- In some cases the selection panel may also ask the candidates to write the summary of the
group discussion in order to know the candidates writing ability as well.

Selection techniques- tests, interviews and salary negotiation.

Psychological tests play a vital role in employee selection.
IT is essential an objective and standardized message of sample of behavior from which
inferences about future behavior and performance of the candidates can be drawn.
Objectivity: Provides equal opportunity to all without any discrimination of
sex caste etc.
Standardisation: Of tests refer to uniformity of procedure in conducting the
tests for all candidates
Sample behavior: Refer to the sample of the total behavior of the prospective
employee on the job.
Psychological tests are classified into:
(i) Aptitude Tests (iii) Situational Tests (v) Interest test
(ii) Achievement tests (iv) personality tests (vi) Multidimensional Tests.
(i) Aptitude Test a) Intelligent test (IQ)
b) Emotional Quotient
c) Skill tests


d) Mechanical aptitude
e) Psychomotor tests
d) Clerical aptitude tests.

(ii) Achievement Test a) Job Knowledge test
b) work sample test

(iii) Situational Test a) group discussion test
b) In-basket

(iv) Interest Test
(v) Personality Test a) Objective tests
b) Projective tests

(vi) Multidimensional testing.

(i) Aptitude Tests: Measures whether an individual has the capacity or latent bility to learn a
given job if given adequate training. Aptitude divided into (a) General &
mental ability (b) Intelligent & specific aptitude viz mechanical electrical,
manipulative capacity etc.
(a) Intelligent Tests: (IQ) A general measure of Intelligent quotient of a candidate. These tests
- capacity of compensation Regarding word fluency also Digit
spans, comprehension, vocabulary, picture, arrangement object assembly.
Intelligent quotient: (IQ) = Mental Age
Actual Age
Candidates with High level of IQ can learn complicated issues easily or fast. For new
technology Preferred

Emotional Quotient (EQ): Important criteria in the selection process.

EQ = Emotional Age
Actual Age

Emotional involvement and commitment of the employees determine their contribution to the
company rather than IQ
c) Skill Tests: Measure the candidates ability to do a job perfectly and intelligently useful, to
prefer artistic jobs, product design, Tool design, machine design etc. Assembly work, testing
X 100
X 100


d) Mechanical Aptitude Tests: Measure spatial visualization perceptual speed & knowledge of
mechanical matter useful to select, Apprentices, skilled, mechanical employees.
e) Psychomotor Tests: Measure abilities Technicians etc Manual Dexterity, Motor ability, Eye
hand co ordination to select semi skilled workers for repetitive operations packing watch
assembly etc.
f) Clerical Aptitude Tests: Measure specific capacities involved in office work- spelling,
computation, comprehension, copying, word measuring etc.
ii) Achievement Tests: Measure value of specific achievement when experienced candidates are
need by an organisation.
a) Job knowledge Test: To test knowledge of a particular job, especially on
b) Work sample tests: Absorption of actual work is given to candidate as a test and
candidate asked to do it. E.g Lecturer is asked to deliver a lecture on MIS as work
sample test.
iii) Situational tests: Evaluate a candidate in a similar real life situation. Candidate either to
cope with situation or solve critical situations of the job.
a) Group discussion: Candidate is observed in the areas of initiating, Leading, proposing
valuable Ideas, Communication skills, Coordinating & Concluding skills.
b) In basket: Situational Test Administered through in basket, Candidate is provided
with actual letters, Telephone, Telegraphic message, Reports & Requirements by
various officers of the organization. Candidate is asked to take decision on various
items based on the in Basket Information regarding Requirements in the memoranda.
iv) Interest Tests: Are inventories of the likes and dislikes of the candidates in relation to job,
Occupations, Hobbies, & Recreational activities, To evaluate Candidates in the job under
selection & to find out which area of the job range / occupation the candidate is interested.
Interest inventories are less faked & may not fluctuate after 30 years of age.
v) Personality Tess: These tests prove to discover maturity & characteristics, mood expressed in
traits as Self confidence, Tact, Optimism, Patience, Fear, Distrust Emotional Control,
Decisiveness, Initiative- Sympathy, Conformity, Objective, Integrity, Judgment Dominance or
Submission, Impulsiveness, stability and self confidence.
a. Objective tests: Are suitable for group testing and can be scored
b. Projective Tests: Candidates are asked to project their own interpretation of certain
standard stimulus situations. Basing on Ambiguous pictures, figures etc. Under these
- Candidates can Fake and give socially acceptable answers.


- These test may not successfully predict job success.
vi) Multi Dimensional Testing:
Consequent to Globalization, competitiveness and customer orientation strategies these
tests on multi skills are being given importance by most of the organizations. Organizations have
to develop multi dimensional testing in order to find out whether the candidates possess a variety
of skills or not. Candidates ability to integrate the multi skills and potentiality to apply the based
on situational and functional requirements.
E.g. L& G has realized that most of the company operations production, marketing- finance-
Human Resources Management can be done by almost all employees. Expert are needed to rare
cases In fact services of experts can be out sourced as such, L& G started selecting the
candidates with multiskills and who can perform a variety of functions L & G developed Multi
Dimensional Testing
It is a method by which an idea about an applicants personality including his
intelligence, breadth of interest and general attitudes towards life can be obtained by face to face
contact Straus & Sayles
- Interview is a powerful exchange of Ideas, the answering of questions and
communications between two or more persons
Interview follows testing
This is the most essential step in the process of selection. In this step, the interviewer
matches the information obtained about the candidates through various means to the job
requirements and to the information obtained through its own observation during the interview
Types of Employment interview are:
(i) Preliminary Interview Informal Interview
Unstructured Interview
(ii) Core Interview Background information Interview
Job and Probing Interview
Stress Interview
Group Discussion
Formal & Structured interview
Panel Interview
Depth Interview


(iii) Decision Making interview
(i) Preliminary Interview: a) Informal Interview: Can be conducted at any place by any person
to secure the basic and non-job related information. Eg. A prospective candidate meeting the HR
Manager to enquire about the vacancies or additional particulars in connection with employee
(ADVT) - Advertisement.
a) Unstructured Interview: This is unstructured, non planned non formatted. This is a
free patterned interview, candidate is encouraged to talk freely on variety of
subjects including his view, on his aspiration, values, expectations, and on
politics. It helps an individual to open up his mind. A trained mind can depicter
from such outbursts and different attributes of his personality. This requires
trained and qualified persons to take interviews.

(ii) Core Interview: It is interaction between the candidate and the executive/ experts on various
areas of job knowledge, skill, talent, etc Interview takes various forms
I. Back Ground Information Interview:
To collect additional information not available in application- Education, Domicile,
Family, Health, Interest, Hobbies, Likes, Dislikes, Extracurricular Activities.
II. Job and probing interview: To test the candidates job knowledge duties, Activities,
Methods of doing the job, critical & problematic areas & Method of handling those areas etc.
III. Stress Interview: Aim is to test the job behavior and level of withstanding stress, strain.
E.g: Interrupt answer from Applicant, Criticize his opinion, questioning in unrelated areas,
keeping silent for long time
To be handled with skill care, not valid always since it does not reflect true behavior under such
IV. Group Discussion Interview:
a) Group interview: Candidates brought into one room, Interview room- And are
interviewed one by one, saves executive time, and gives a fait amount of the objectivity
of the interview to candidates.
b) Group Discussion method: One topic is given for discussion to the candidates who
assemble in one room and asked to discuss the topic in detail. Interviewer judges on
Initiative, dynamism inter personal skills, Presentation, Leading comprehension,
collaboration. May not reflect on the candidates Background skills.
V) Formal and Structured Interview:
A pre planned structured in advance, Experts are allotted different areas & Questions to
be asked in a particular sequence.


VI) Panel Interview:
A panel of experts interview each candidate, judges his performance individually and
prepares consolidated judgement. Conducted for Middle/ Senior level managers.

VII) Depth Interview:
Examined extensively in core areas of job skills and knowledge in depth. Applicable for
specialist jobs.
III) Online interview: Global companies do this to be cost effective
After experts & line mangers interview candidates, the head of the Department /section
concerned interview/ examine candidates interest in the job organization, Reaction /
Adaptability to the working conditions, career, planning, promotional opportunities, work
adjustment allotment etc. Personnel Manager interview to find out Reaction / Acceptance
Regarding Salary, Allowances, benefits, promotions & Opportunities etc Both HOD and HR
Manager decide jointly & Inform Chairman about candidates performance and their ranks in the
interview. Organizations look for positive attitude, pro active qualities, than skills and
Interview process: Major steps are grouped into four categories as shown below:
Steps in

(a) Preparation for Appropriate type of interview
the Interview The Areas to be tested

Type & Number of Interviews

Review the information

(b) Conduct the Open the Interview
Get Complete & Accurate Information
Record observation & Impressions

Guide the Interview

Check the Success of the Interview
(c) Close the Interview

(d) Evaluate Interview Results.



(a) Preparation for the Interview: Advance preparation for Interview is essential as it permits
focusing its coverage on the vital aspects and it helps the interviewer to remember and absorb
many impressions and facts.
Choosing appropriate type of Interview: Based on Job requirements and the
nature of interviews.
Areas to be used : Knowledge, Skill areas, to be
examined through interviews
Type and Number of Interviews : Interviewers should be selected based on personal
characteristics, Technical, Competence, Initiative, Common sense, General Smartness, Ability,
To inspire, Confidence, Capacity, To work in team, Potential for growth required from
Interviews may be drawn from Personnel Specialists, Line managers Concerned, Experts from
discipline concerned from Academicians, Practioners, and Psychologists, to include in team.
Psychologists may be competent interviewer if he has got knowledge of job requirements &
organizational interest.
Psychologists may be effective, if they are qualified, experienced and trained
Psychologists views may form as additional source of information than a deciding factor

Number of interviews Depend on:
Number of areas to be covered by the interviewer.
Number of candidates to be interviewed Time available.
Review of the Information: Collected Through selection methods to be checked thoroughly
Accuracy & Validity
Suitability & Review number of positions
Length of time held in each of the past jobs
Nature of position in the previous employment
Growth in the past employment
Acquainting & about the appliance
Find out discharge etc through breaks



(b) Conducting the interview
The selection of competent interviewers, Training and Developing them is an Essential step.
(i) OPEN THE INTERIVIEW: Interviewers to open the interview with a friendly voice
& Appearance to Establish a rapport & confidence of the Candidates.
(ii) Get Complete and accurate information:
- The interviewer to get full information relating to skill, knowledge, attitude, and
Trait of candidate the approach suggested are
- Use language clear to the Interviewer
- Ask straight and direct questions to avoid ambiguity
- To make remarks favourable/ Un favouable about the applicants motive to obtain
truthful information.
- To frame questions in such a way the candidate answer elaborately
(iii) Recording of observation and impressions: By the interviewer in course of the
interview with a view to manage the information system for evaluating candidates
suitability at a later stage.

(iv) Guide the Interview: To get complete & Reliable information
- To have sufficient discussion not too much or too less on a specific topic.
- To lead the applicant tactfully towards interview goal
- To avoid applicant giving known information avoid relevant needed
Major step in interview is to check the success of the interviewer in conducting the
(v) Check success of the interviewer: Through following
Making favourable impression on candidate at start of interview
Avoid making judgement at the beginning.
Putting the candidate at ease. Giving chance for further discussion
Asking questions at the right time, clearly at appropriate language
Avoiding unwanted interference. Talking minimum need based
Guiding interview. Obtaining & Relieving & Adequate information
Follow-up leads. Taking notes. Crating good impression throughout
Avoiding expression of approval / Disapproval of any attitude
Giving opportunity to candidates to ask questions
Giving the candidates a feeling of fair conduct of interview


Closing interview pleasantly with an indication.
(c) Close the interview: is an important as its commencement and it should end pleasantly. At
an appropriate time and the interviewer to indicate the sign of closure of Interview.

(d) Evaluate Interview results: Should follow immediately after closure of interview. Proper
weightage given to attribute which are pre determined during preparatory phase. Evaluation done
by grade & marks. List prepared as per Ranking based on marks / grade as decided by the policy
of the company

Salary negotiation

Preparing for a Successful Negotiation
Depending on the scale of the disagreement, some preparation may be appropriate for conducting
a successful negotiation.
For small disagreements, excessive preparation can be counter-productive because it takes time
that is better used elsewhere. It can also be seen as manipulative because, just as it strengthens
position, it can weaken the other person's.
However, if need to resolve a major disagreement, then make sure you prepare thoroughly.
Using our free worksheet, think through the following points before starting negotiating:
Expected outcomes
The consequences
Possible solutions

Style is Critical
For a negotiation to be 'win-win', both parties should feel positive about the negotiation once it's
over. This helps people keep good working relationships afterwards. This governs the style of the
negotiation histrionics and displays of emotion are clearly inappropriate because they
undermine the rational basis of the negotiation and because they bring a manipulative aspect to
Despite this, emotion can be an important subject of discussion because people's emotional needs
must fairly be met. If emotion is not discussed where it needs to be, then the agreement reached
can be unsatisfactory and temporary.

Meaning and significance of appointment,
Once the offer of employment is made after the selection process, and such offer has been
accepted, the next logical step is to place the individual on the job.


Appointment is the determination of the job to which an accepted candidate is to be assigned
and it assignment to the job. It is a matching of what the supervisor has reason to think, he can
do with the job demands (job requirements), it is a matching of what he imposes (in strain,
working conditions) and what he offers in the form of pay roll, companionship with others,
Promotional possibilities etc.

Creating interest in his job and the company
Providing basic information about working arrangements
Indicating standard of performance and behavior expected of him
informing of training facilities.
Creating feeling of social security

Process of appointment,

Legal aspects of employment contract,

The Terms of Employment (Information) Acts 1994 and 2001 provide that an employer is
obliged to provide an employee with a written statement of terms of employment within the first
two months of the commencement of employment. However, this requirement does not apply to
an employee who has been employed for less than a month.
The statement of terms must include the following information:
The full name of employer and employee



The address of the employer
The place of work
The title of job or nature of work
The date the employment started
If the contract is temporary, the expected duration of the contract
If the contract of employment is for a fixed term, the details
Details of rest periods and breaks as required by law
*The rate of pay or method of calculation of pay
The pay reference period for the purposes of the National Minimum Wage Act 2000
*Pay intervals
*Hours of work
*That the employee has the right to ask the employer for a written statement of his/her average
hourly rate of pay as provided for in the National Minimum Wage Act 2000
*Details of paid leave
*Sick pay and pension (if any)
*Period of notice to be given by employer or employee
*Details of any collective agreements that may affect the employees terms of employment
* In the case of these items instead of giving each employee the details in writing, the employer
may refer an employee to other documents, for example, a pension scheme booklet or a
collective agreement, provided that the employee has easy access to such documents.
The statement of terms must indicate the reference period being used by the employer for the
purposes of the calculation of the employee's entitlements under the National Minimum Wage
Act 2000. (Under that Act the employer may calculate the employee's minimum wage
entitlement over a reference period that is no less than one week and no greater than one month).
Disciplinary and grievance procedures
The Labour Relations Commission has published the Code of Practice: Grievance and
Disciplinary Procedures (pdf)which states that employers should have written grievance and
disciplinary procedures and they should give employees copies of these at the start of their
employment. Under the Unfair Dismissals Acts 1977-2007 employers are required to give the
employee in written notice of the procedures to be followed before an employee is dismissed.
This must be done within 28 days of entering the contract of employment.
Specific provisions in contracts of employment
In recent times, some employers are adding in specific provisions in contracts of employment
that limit the ability of employees to work in a certain sector, with certain suppliers, clients, for a


period following termination of employment. (For example, it may specifically state that the
employee cannot work in a certain sector, with or for suppliers or clients of the former
employer.) There is nothing in employment law that strictly forbids this, but there is no provision
in employment law that allows this either.
Probationary period
The contract can include a probationary period and can allow for this period to be extended. The
Unfair Dismissals Acts 1997-2007 will not apply to the dismissal of an employee during a period
at the beginning of employment when he/she is on probation or undergoing training provided
the contract of employment is in writing
the duration of probation or training is one year or less and is specified in the contract.
The above exclusion from the Acts will not apply if the dismissal results from trade union
membership or activity, pregnancy related matters, or entitlements under the maternity
protection, parental leave, adoptive leave and carer's leave legislation.
Changes to contract of employment
Changes to contract of employment can occur due to a change in the law, but otherwise, changes
must be agreed between employer and employee. The requirement for both the employer's and
the employee's consent to changes in the terms of the contract is part of contract law.

Joining formalities

1) Grade Sheet check: Most basic formality s to check all the documents. This process is
carried on in two phases, i.e. pre joining and post joining.
In pre joining phase, you are asked to upload the scanned PDF files of detailed mark/grade sheets
right from 10
std. up to the Bachelors or masters degree including semester results.
Post joining, all the grade sheets are verified against the originals carry along. Make it sure to
carry same documents that are uploaded.
2) PAN Card and Passport: You are advised to get a PAN card and passport legally processed
and availed from the governing bodies responsible, as these two plays a vital role in
identification and work scalability.
3) National Skills Registry (NSR) Registration: NASSCOM has come up with an initiative to
keep a record of the tech work force in the country, which allows to build up a profile based on


confirmed qualification, finger prints and reg. No. this long term project gives one a facility to
propose her/himself via this profile to IT companies worldwide.
4) Medical Reports: Getting an overall medical checkup certificate is a vital part of joining
formalities in companies. The test reports from any registered practitioner have an expiry date.
As enter an organization, need to be 100% fit but the major reason behind this are provisions of
health insurance, for which health needs to be tested and recorded to device policy and cover by
the management.
5) Criminal background confirmation: A few organizations even ask for a no criminal
background document from the concerned authorities.
6) Experience Letter(if any) : An experience letter from the previous place of work needs to be
authentic up to the duration of work, nature of job, projects undertaken etc. as there is a separate
team that checks and confirms information with previous employer.
7) Traveling allowance: If company provides a one time traveling allowance, keep the tickets
intact so that can submit them to generate a claim later.
8) Salary Bank Account: Most of the Companies do-not bar to open salary account with bank
of choice. If company has no such restriction, could get bank account documents done with
desired bank during the joining or initial days post joining. Later when SAP account gets done in
the company records, could update account details there.


Induction is the process of receiving and welcoming an employee when he first joins a company
and giving him the basic information. He needs to settle down quickly and happily and start the
assigned work
Objective of induction:
Putting the new employee at ease
Creating interest in his job and the company
Providing basic information about working arrangements
Indicating standard of performance and behavior expected of him
informing of training facilities.
Creating feeling of social security


Minimizing reality shock: i.e the incompatibility caused between the employee expectations,
actually what the company provides/offers- regarding pay, Benefits, Status, working &
conditions, Responsibility, opportunity for growth, innovations, creative ideas etc.
INDUCTION PROCESS: The following steps are suggested as stages of induction process.
Reporting for duty at a certain place to the Head of Department concerned
The Head of the Department welcomes the New Employee.
Organisational / Branch Head introduce to important employees and describes about the
Department head introduces to all employees of department and Goals of the Department etc.
Supervisor concerned introduces to co workers. In that section / Unit to the work/Job,
Providing information, Duties, responsibilities, Rights, facilities, Provisions, welfare
measures etc.
Supervisor clarifies about the doubts of the New Employee about the work.
i) First impression matters: A good deal and results in fewer turnovers.
ii) Newcomer adjusts himself to the work quickly, and it saves time of the
iii) Reduce employees dissatisfaction and grievances.
iv) Develops a sense of belongingness and commitment.



Module 4 (8 Hours)
Training and development

Meaning and significance of training and development
Training : Training is a learning process which seeks relatively a permanent change in
behaviour that occurs as a result of experience.
Training is the art of increasing the knowledge and skills of an employee for doing a particular
Development: Development is the process of transition of an employee from a lower level of
ability, skill & knowledge to that of higher level. This transition is influenced by education,
training, work experience and environment.

This will improve value of individual employees in terms of his self development, career growth
& contribution to organisation.

Development covers not only those which bring about growth of performance, but also those
which bring about growth of personality, help individuals in the progress towards majority &
actualization of their potential capacities, so that they become not only good employees but
better men women-(MEMORIAL)


Improves profitability & profit orientation with positive attitude
Improves job knowledge & skills at all levels of organisation
Improves morale of workforce, helps people identify organisation goal
Improves relationship between boss & subordinates
AIDS in organizational development, helps to prepare guideline for work
AIDS in understanding & carrying out organizational policies
MIS at all department for future needs
Organisation becomes more effective in decision making & problem solving
AIDS in developing, leadership skills, motivation, loyalty, better attitude
AIDS in increasing productivity & quality work
Help in keeping cost down production, personnel & Administration
Develops a sense of responsibility to the organisation
Improves labour management relations
Reduces outside consulting costs by using internal competency
Stimulates preventive management as opposed to putting out fires
Creative appropriate climate for growth & communication
Helps employee adjust to changes
Aids in handling conflicts, thereby helping to prevent stress & tension



Process of training development,
The Training Process
The model below traces the steps necessary in the training process:
Organizational Objectives
Needs Assessment
Is There a Gap?
Training Objectives
Select the Trainees
Select the Training Methods and Mode
Choose a Means of Evaluating
Administer Training
Evaluate the Training

Needs analysis,
Training needs can be assessed by analyzing three major human resource areas: the organization
as a whole, the job characteristics and the needs of the individuals. This analysis will provide
answers to the following questions:
Where is training needed?
What specifically must an employee learn in order to be more productive?
Who needs to be trained?
Begin by assessing the current status of the company how it does what it does best and the
abilities of employees to do these tasks. This analysis will provide some benchmarks against
which the effectiveness of a training program can be evaluated. Firm should know where it wants
to be in five years from its long-range strategic plan.
Second, consider whether the organization is financially committed to supporting the training
efforts. If not, any attempt to develop a solid training program will fail.
Next, determine exactly where training is needed. It is foolish to implement a company-wide
training effort without concentrating resources where they are needed most. An internal audit
will help point out areas that may benefit from training. Also, a skills inventory can help
determine the skills possessed by the employees in general. This inventory will help the
organization determine what skills are available now and what skills are needed for future
Also, in today's market-driven economy, would be remiss not to ask customers what they like
about business and what areas they think should be improved. In summary, the analysis should
focus on the total organization and should tell (1) where training is needed and (2) where it will
work within the organization.


Once have determined where training is needed, concentrate on the content of the program.
Analyze the characteristics of the job based on its description, the written narrative of what
the employee actually does. Training based on job descriptions should go into detail about how
the job is performed on a task-by-task basis. Actually doing the job will enable to get a better
feel for what is done.
Individual employees can be evaluated by comparing their current skill levels or performance to
the organization's performance standards or anticipated needs. Any discrepancies between actual
and anticipated skill levels identifies a training needed
Training design,

The first step in the design of training involves an assessment of training needs. The assessment
comprises -
Observing workers performing normal duties
Interviewing workers and others
Studying routine reports or performance reviews, along with job descriptions
Identifying performance problems

The second step involves defining the training programs learning objectives. The learning
objectives, which are derived from the needs assessment, specify the observable, measurable
actions that each learner will be able to demonstrate as a result of participating in the training
The third step is the creation and implementation of a training program to improve performance,
taking into account the experience and educational levels of the personnel and the time and
resources available for training.
Options range from short courses to long-term placements in academic institutions in the
country, in the region, or overseas, and nonclassroom-based interventions, such as on-the-job
training, coaching, and mentoring.
All options must be weighed against the immediate operational needs of the program or
institution, because facilities may not have enough personnel to operate when staff members go
for training.
Training implementation


Pilot Test & revision. Most revisions are refinements of execution points and time frames
Trainthetrainer & revision. Adjustments made are very minor at this stage, usually limited to
delivery execution details or typographical edits.


Regional / Divisional / Areabased deployment. For smaller organizations this is a single step, a
nd coordination requirements are low.

Training evaluation

The specification of values forms a basis for evaluation. The basis of evaluation and the
mode of collection of information necessary for evaluation should be determined at the planning
stage. The process of training evaluation has been defined as "any attempt to obtain information
on the effects of training performance and to assess the value of training in the light of that
information." Evaluation leads to controlling and correcting the training programme. Hamblin
suggested live levels at which evaluation of t rai ni ng can take place, viz. reactions, learning, job
behaviour, organisation and ultimate value. (See Box 9.11).

Box 9.11 How to Make Training Effective
Determine training needs through job description, performance appraisal forms and
potential appraisal discussions.
Prepare a training calendar in discussion with managers.
Training programmes should be well defined specific objectives.
Nominate the employees for training based on a need for training.
Trainers should be qualified and experienced, and preferably internal.

(i) Reactions: Training programme is evaluated on the basis of the trainee's reactions to the
usefulness of coverage of the matter, depth of the course content, method of presentation,
teaching methods etc.
(ii) Learning: Training programme, trainer's ability and trainee abilit y are evaluated on the
basis of quantity of content learned and time in which it is learned and the learner's ability to use
or apply the content he learned.
(iii) Job Behaviour: This evaluation includes the manner and extent to which the trainee has
applied his "naming to his job.
(iv) Organisation: This evaluation measures the use of training, learning and change in the job
behaviour of the department/organisation in the form of increased productivity, quality, morale,
sales turnover and the like.
(v) Ultimate Value: It is the measurement of the ultimate result of the contributions of the
training programme to the Company goals like survival, growth, profitability etc. and to the
individual goals like development of personality and social goals like maximising social benefit.

The various methods of training evaluation are:
(i) Immediate assessment of trainees' reaction to the programme.
(ii) Trainees' observation during the training programme.
(iii) Knowing trainees' expectations before the training programme and collecting their
views regarding the attainment of the expectations after training. (iv) Seeking opinion of
the trainee's superior regarding his/her job performance and behaviour before and after
(v) Evaluation of trainee's skill level before and after the training programme
(vi) Measurement of improvement in trainees on the job behaviour.


(vii) Examination of the testing system before and after sometime of the training programme.
(viii) Measurement of trainee's attitudes after the training programme.
(ix) Cost-benefit analysis of the training programme.
(x) Seeking opinion of trainee's colleagues regarding his/her job performance and behaviour.
(xi) Measurement of levels in absenteeism, turnover, wastage/scrap, accidents, breakage of
the machinery during pre and post period of the training programme.
(xii) Seeking opinions of trainee's subordinates regarding his/her job performance and

Methods of training -on the job methods and off the job methods

On-The-Job Training Methods
This type of training, also known as job instruction training, is the most commonly used
method. Under this method, the individual is placed on a regular job and taught the skills
necessary to perform that job. The trainee learns under the supervision and guidance of a
qualified worker or instructor. On-the-job training has the advantage of giving firsthand
knowledge and experience under the actual working conditions. While the trainee learns how to
perform a job, he is also a regular worker rendering the services for which he is paid. The
problem of transfer of trainee is also minimised as the person learns on-the-job. The emphasis is
placed on rendering services in the most effective manner rather than learning how to perform
the job. On-the-job training methods include job rotation, coaching, job instruction or training
through step-by-step and committee assignments.

(i) Job Rotation: This type of training involves the movement of the trainee from one job to
another. The trainee receives job knowledge and gains experience from his supervisor or trainer
in each of the different job assignments. Though this method of training is common in training
managers for general management positions,Jrainees can also be rotated from job to job in
workshop jobs. This method gives an opportunity to the trainee to understand the problems of
employees on other jobs and respect them.

(ii) Coaching: The trainee is placed under a particular supervisor who functions as a coach in
training the individual. The supervisor provides feedback to the trainee on his performance and
offers him some suggestions for improvement. Often the trainee shares some of the duties and
responsibilities of the coach and relieves him of his burden. A limitation of this method of
training is that the trainee may not have the freedom or opportunity to express his own ideas.

(i i i ) Job Instruction: This method is also known as training through step by step. Under this
method, the trainer explains to the trainee the way of doing the jobs, job knowledge and skills
and allows him to do the job. The trainer appraises the performance of the trainee, provides
feedback information and corrects the trainee.

(iv) Committee Assignments: Under the committee assignment, a group of trainees are given
and asked to solve an actual organisational problem. The trainees solve the problem jointly. It
develops team work. (See Box 9.6 for examples on training).



Off-the-Job Methods

Under this method of training, the trainee is separated from the job situation and his
attention is focused upon learning the material related to his future job performance. Since the
trainee is not distracted by job requirements, he can place his entire concentration on learning the
job rather than spending his time in performing it. There is an opportunity for freedom of
expression for the trainees. Companies have started using multimedia technology and
information technology in training (See Box 9.7 and Box 9.8) Off-the-job training methods are
as follows:

(i) Vestibule Training: In this method, actual work conditions are simulated in a class room.
Material, files and equipment which are used in actual job performance are also used in training.
This type of training is commonly used for training personnel for clerical and semi-skilled jobs.
The duration of this training ranges from days to a few weeks. Theory can be related to practice in
this method.

(ii) Role Playing: It is defined as a method of human interaction that involves realistic behaviour
in imaginary situations. This method of training involves action, doing and practice. The
participants play the role of certain characters such as the production manager, mechanical
engineer, superintendents, maintenance engineers, quality control inspectors, foremen, workers and
the like. This method is mostly used for developing inter-personal interactions and relations.

(iii) Lecture Method: The lecture is a traditional and direct method of instruction. The instructor
organises this material and gives it to a group of trainees in the form of a talk. To be effective, the
lecture must motivate and create interest among the trainees. An advantage of the lecture method is
that it is direct and can be used for a large group of trainees. Thus, costs and time involved are
reduced. The major limitation of the lecture method is that it does not provide for transfer of
training effectively.
(iv) Conference or Discussion: It is a method in training the clerical, professional and supervisory
personnel. This method involves a group of people who pose ideas, examine and share facts, ideas
and data, test assumptions and draw conclusions, all of which contribute to the improvement of job
performance. Discussion has the distinct advantage over the lecture method, in that the discussion
involves two-way communication and hence feedback is provided. The participants feel free to
speak in small groups. The success of this method depends on the leadership qualities of the person
who leads the group.

(v) Programmed Instruction: In recent years, this method has become popular. The subject-
matter to be learned is presented in a series of carefully planned sequential units. These units are
arranged from simple to more complex levels of instruction. The trainee goes through these units
by answering questions or filling the blanks. This method is expensive and time consuming.



Module V
Compensation and benefits

Meaning and significance of compensation and benefits

Compensation and Benefits in wages and salaries are the most important single element which
influence continued retention of employees. This helps to attract, develop, and promote
employees to meet individual and organizations objectives.
Motivates and boost employee morale. Generally administration need to to be Fair and appear
to be fair Wages and salaries administration form part of compensation
. Wage survey, Job Evaluation,. wage fixation for individuals.
. Wages incentive schemes, Hiring Benefits, compensation package for executives System of

Compensation Benefits Wages, salaries, Bonus, Fringe Benefits, They are the money given to
employees towards their services.

Wages: The Remuneration paid by the employer for the services of Hourly, Daily, Weekly &
fortnightly Employees. Also means that Remuneration paid to production, Maintenance or Blue
collar employees.

Salary: The Remuneration paid to the Clerical and Managerial personnel employed on Monthly
or Annual Basis.

Wages / Salary: The Direct Remuneration paid to an Employee compensating the services to an


To Retain the Present Employees.
To secure Internal / external security.
- Similar wages for similar jobs in comparable organization
To Maintain labour and administrative codes
To ensure desired behavior.
To comply with wage Legislation.
To exhibit Public as Progressive Employers.
To pay in line with the content and Difficulty
To Simplify collective bargaining
- Procedures and Negotiations.
To promote or organization growth prospects / Feasibility.

Basic salary, allowances, incentives, perks, and benefits

Minimum Wage


Minimum wage is the one which provides not merely for bare sustenance of life, but also
for the preservation of the efficiency of the worker. For this purpose, the minimum wage must
also provide for some measure of education, medical requirements and amenities. Minimum
wage may be tied by an agreement between the management and the workers, but is usually
determined through legislation. This is more so in the unorganised sector where labour is
unionised. In the fixation of minimum , wages, besides the needs of workers, other factors like
ability of the concern to pay, nature of the
jobs, and so on, are also considered.

Fair Wage
Fair wage is understood in two ways. In a narrow sense, wage is fair if it is equal to the
rate prevailing in the same trade and in the neighborhood for similar work. In a wider sense, it
will be fair if it is equal to the predominant rate for similar work throughout the country and for
trades in general. Irrespective of the way in which fair age is understood. It can be fixed only by
comparison with an accepted standard wage. Such a standard can be determined with reference
to those industries where labour is well organised and has been able to bargain well with the

Living Wage

Living wage is a step higher than fair wage. Living wage may be described as one which
should enable the wage earner to provide for himself/herself and his/ her family not only the bare
essentials of life like food, clothing and shelter, but a measure of frugal comfort including
education for children; 'protection against ill health; requirements of essential social needs;
and/or measure of insurance against the more important misfortunes including old age. A living
wage must be fixed considering the general economic conditions of the country. The concept of
living, wage, therefore, varies from country to country. In the more advanced countries, living
wage itself forms the basis for the minimum wage.

In India, minimum wage is determined mainly for sweated industries under the
provisions of the Minimum Wages Act, 1948. Fair wage is fixed for other industries considering
prevailing rates of wages, productivity of labour, capacity of the employer to pay, level of
national income and other
related factors.

Tribunals, awards and wage boards play major role in fair wage fixation. Many people
are of the opinion that living wage is " luxury for a developing country like India and can
therefore be deferred

Employee remuneration has different connotations for different people. For an employee, it
means status and standard of living for the employer it adds to the cost; and to the HRM
administration of remuneration is an important activity.

Remuneration comprises both financial as well as non-financial benefits. Only financial benefits
are considered in this chapter.

Concepts of wages:


While Evolving, wage policy, three concepts of wages, Namely, (i) Minimum wages, (ii) Fair
wages, (iii) Living wages are generally considered.
These are broadly based on the needs of the workers, capacity of the employee to pay, General
Economic conditions prevailing.

Factors affecting wages/ Salary levels.

(i) Remuneration in comparable industries.
(ii) Firms ability to pay
(iii) Cost of living
(iv) Productivity
(v) Union pressure and strategies
(vi) Government legalizations
- Minimum wages act 1948 provides the following
1. Minimum wages in certain employment
2. Minimum Time rate
3. Minimum price rate
4. Guarantee time rate
5. Overtime rate
6. Basic pay, D.A
Act provides for revision of minimum wages at fixed intervals.

Management evaluates the jobs with a view to know the worth of the job and determine the
wages or salary.

An attempt to determine and compare demands which the normal performance of a particular
job makes on normal workers without taking into account the individuals abilities or
performance of workers concerned.
-International Labour Organisation

A process of determining the relative worth of the various jobs within the organization, so that
differential wages may be paid to jobs of different worth
-Wendell . French

The process of analyzing and assenting the contents of the job, in order to place them in an
acceptable rank order which can then be used as basis for a remuneration system. Simply a
technique designed to assist in the development of new pay structures by defining relatives
between jobs on a consistent and systematic basis
-British Institute of Management 1970

Structured pay scales of the government sector


Wage Salary Survey:

Wage survey forms in important process of wages and salaries administration, the objective is to
gather data and analyse them for getting following information which are essential to take policy
decisions by the organization for the wages.
- Growing wage rates for different jobs
- Prevailing practices of wages in various types of industries
- Variation of wage rates between geographical areas for similar jobs.
- Identification of wage leaders viz companies which pay higher rates than most others.

Steps involved in wage survey while carryout out:
Select Industry
Select area of geographical locations
Identify key jobs which are common in most firms
Obtain job Descriptions of the key jobs selected.
Prepare schedule of information via. Hourly wage or daily wage.
Collect Data based on interviews, questionnaire Techniques etc
Compute data on wages and salaries for each job
Prepare summary of findings
Make recommendations.













prevailng wage rates
ability to pay
cost of living
attraction and retentionof employees

Govt. Legislation
Labour Market supply / Demand
Job Requirement
Union Vs Management
Management attitude
Social / Psychological factor.

Cost to company approach of the private consultant

Cost to company is the return to the employees service in terms of remuneration paid to the
white collar employees working in multinational company and private sectors

It refers to all plans that provide extra pay for extra performance in addition to regular wages
for job
-Hummela Nickerson
wage incentives are extra financial motivation. They are designed to stimulate human effort by
rewarding the person over and above the time rated remuneration, for the improvements in the
present or targeted results.
National Commission of Labour.
(i) To improve profits of a firm trough a reduction in the unit cost of labour and
materials or both.

(ii) To avoid / minimize additional capital investment for the expansion of
production capacity.

(iii) To improve /increase a workers earnings without entering into higher wage
rate structure.

(iv) To use wage incentive as a useful tool for securing better utilization of
manpower, better production scheduling and performance control effective
personnel policy.



Important Wage Incentive Plans:

(i) Halsey Premium Plan: A time saving bonus plan based on daily wage & Piece wage with
(ii) Halsey weir premium plan: Similar to (i) above except bonus at 50% of time saved.
i.e incentive = x time saved x hourly rate.
(iii) Rowan Premium Plan: Incentive = Time saved x time taken x hourly rate
Time allowed
(iv) The 100% premium Plan: Task standards set by time study
E.g For Rs.10/Hr for 10hrs job, cone in 8 hrs,
(v) The Bandeaux point plan: Used where more accurate performance standard
every job is expressed as BEDEAXminutes & payment
in proportion to minutes saved.
(vi) Taylors Differential piece
rate plan
Aim(1): To give sufficient incentive & make them
work to capacity
Aim (ii): Remove fear of wage cut
(Vii) Merrics Multiple Piece
rate plan:
Based on low piece rate of slow worker & high piece rate for
higher production. Divided into 3 slabs i.e (i) Upto 83%,
+20% time rate
(ii) upto 83 to 100% + 10% time rate
(iii) 100% above standard time
(% of time taken of standard time)
(viii) GNATT Task plan Three stage of payment
(i) Below standard performance, Minimum wage is
(ii) at standard performance the standard wage
+20% incentive
(iii) when standard wage is exceeded Higher Piece
(ix) Emerson efficient plan Standard time for standard job:
No incentive upto 2/3 level of efficiency
after attaining 2/3% level a nominal incentive,
2/3 to 1 level 20% incentive,
at 1.2- 40% incentive
(x) Co-partnership system Apart from standard wages
Performance + overall operation efficiency based sharing
(xi) Acceleration premium
For low & average output above standard
a small increment in earning substantially a large output will
get proportion to the increase




Profit Sharing: Is an arrangement by which employees receive a share. Fixed in advance of the
Prof. Seager

An arrangement (formal /informal) freely entered into, by which an employee receives a share
fixed in advance of the profits.
International Cooperative Congress -1889 (Paris)
Profit sharing involves determination of an organisations profits at the end of fiscal year and the
distribution of a percentage of the profits to workers qualified to share the earnings. Enable
worker take more responsibility and improve productivity to results in higher profits.

Agreement voluntary between
- Employers Vs Employees
(a) Current profits: Directly paid on cash
/cheque or in the form of op stock
Payments made in Cash form (b) Deferred profits: Credited to Employee a/c.
& paid at the time of retirement
Employees should become eligible
(Tenure wise etc) to get the benefit
(c) Combination: Partly paid in cash & partly
in employees account or trust fund
Since mutually accepted agreement
employer cannot discriminate
Forms of profit sharing
(a) Industry basis
(b) Locality basis
(c)Unit basis
(d) Department basis
Amount to be distributed as agreed &
supplied at all times
Amount to be distributed depends on
the profits earned at an enterprise
(e) Individual Basis
Proportion of profits to be distributed
determined in advance

Bonus Concept: Extra payment beyond normal wage. Is a deferred payment of wages which
aims at bridging the gap between actual wage and the need based wage. It is share of the
workers in the prosperity of an organization.

Pay for Performance: One major source for such decisions are Performance appraisal for
all employees for workers- their attendance, General behavior, and their continuous
incentive earnings will be a source advantages of pay for performance through good
incentive schemes/ Profit sharing are

(i) Employees Employer develop better mutual understanding and
(ii) Industrial Disputes tend to reduce.
(iii) Productivity
(iv) Scrap and waste tends to reduce
(v) Labour turnover reduces
(i) Workers efficiency increases


(ii) Workers morale and motivation
(iii) Develops a sense of participation in the employees
(iv) Others: It stimulates interest (Especially profit sharing) of workers who cannot be
placed on piecework.
(v) Creates a prosperity on the part of workers (ownership)
(vi) Make workers behave in a responsible way
(vii) Minimise industrial disputes.

BENEFITS ADMINISTRATION- Employees welfare & working condition Statutory &
voluntary measures (services)

Benefits Extra moral:
Present day employees expect something more than pay and allowances; Eg. Paid vacation, Sick
leave, Insurance Coverage, Pension
Cultural Activities opportunities, Housing, Canteen - Benefits
Schooling, Hospitals, Banking, Shopping centers - Services
These benefits & services (welfare etc) are grouped as
1. Statutory Benefits.
2. Voluntary Benefits
3. Flexible Benefits.

Statutory aspects of compensation and benefits.

a. Social Security:
1. Medical Care,
2. Sickness Benefits
3. Unemployed Benefits
4. Old age benefits
5. Injury Benefits (ESI)
6. Family Benefits
7. Maternity Benefit
8. Invalidity Benefit
9. Survivors Benefit
b. Compensation against Employment Industry
c. Maternity Benefit
d. Provident Fund:
e. Unemployment Benefits
f. State Insurance
g. Pension/ Family Pension
h. Gratuity
i. Medical Cover.
j. Group Insurance

Rest period or coffee break.


Casual / Earned leave
Sick leave
Paid vacations


SERVICES: (Intramural)
1. Washing Facilities: Factory act 1948; Coal miners Act 1952. Plantation
Labour Act 1952.
2. Facilities for storing and drying clothes
3. Sitting facilities: When not working
4. First aid Box > 150 employees compulsory As per acts above
5. Shelters, Rest Rooms & Lunch rooms - As per acts above
6. The canteen. - As per acts above
7. Creches - As per acts above
8. Welfare officers: Royal commission 1931 Recommended following acts provided necessary
provision for the Factory Act 1948, Plantation Labours Act 1951, & Coal mines Act 1952

Cooperative Societies
Fair Price Shop
Bank and Post office
Cinema Hall & Theaters
Sports club and Recreation Centres
Swimming Pool or Health club.



Module VI
Performance management

Meaning and significance of performance management
Introduction: HRD helps the employees to acquire/develop technical, managerial, and
behavioural knowledge, skills and abilities and modules The values, beliefs and attitude
necessary to perform present and future roles.

The process of performance appraisal helps the employee and management to know the
level of employees performance compared to the standard pre determined level useful to decide
upon employee promotion/ transfer salary etc. Performance appraisal indicates the level of
desired performance level, level of actual performance and the Gap between these two. This Gap
should be bridged through Human Resource techniques like, Training, executive development

Meaning: Method of evaluating Behaviour of Employees in the work spot including both the
quantitative and qualitative aspect of Job performance. Performance is measured in terms of
results and not efforts. Important features are.
Is the systematic description of an employees job relevant strength and weakness.
To find how well the employee is performing the job and establish a plan of improvement.
Appraisals are arranged periodically according to a definite plan

Performance evaluations not job Evaluation. It refers to how well someone is doing the
assigned job. Job evaluation determines how much a job is worth to the organization and
therefore what range of pay should be assigned to the job.
Performance appraisal is a continuous process in every large scale organization.
Is a way to find out interpersonal relationship
Provides job satisfaction of the employees on the job assigned
A system by which favoritism and Discrimination by superiors can overcome- a fair judgment.

Performance management need, purpose, objective. need:
(i) Provide information about performance and decisions regarding salary fixation, Confirmation,
Promotion, Transfer, Demotion are taken based on performance. (INDIAN RAYON)
(ii) Provide feedback information about the level of achievement and behavior of the subordinate.
This information helps to review the performance, subordinates, and Rectifying performance
deficiencies and to set new standards of works if necessary. (Practiced in Raymonds)
(iii) Provide information which helps to counsel the subordinates
(iv) Provide information to diagnose deficiency in employee regarding skill, knowledge,
determine training and developmental needs and to prescribe the means for employee growth and
provide information for correcting placement.
(v) to prevent grievances and disciplinary activities (Glaxo)

(i) To create and maintain a satisfactory level of performance


(ii) Assist managers to take decision: On promotion, transfer, extension of tenure,
Termination etc. In such cases objective assessment of performance is needed.

(iii) Training and development: Needs of employees vary depending on their skill level.
Knowledge Level, Experience. Hence as accurate, up to date information in regard to
their competence level is needed. Appraisal provide this.
(iv) Validation of selection criteria: for certain position or skill.
(v) Feedback to employees: Adequate & Relevant on time feedback is made available for
corrective action, motivation etc.
(vi) Reward Management; Upto date, accurate, objective, performance evaluation is
needed for selecting employees to receive such awards.
(vii) Manpower planning: for these purposes appraisal is useful
- Towards long term successive planning career paths.
- Determination of future vacancies & consequent promotional avenues.
To sum up performance appraisal primary purpose / objective are
Performance feedback
Manpower Planning
Plan Lay off, Retrenchment etc

Process of performance management

Performance goal setting/Standard performance

Communicating the standards performance to employees

Measuring the actual performance

Comparing the actual and standard performance

Identifying the gap


Framing training and development actions to meet the gap

Any organization has to decide on the contents of performance appraisal system.
Generally the Content is decided on the basis of job analysis. The content to be appraised may
vary with the purpose of appraisal & type & level of employees.
E.g PAS Performance Appraisal System at ICODE Software.
For Managers
Building progress towards organizational goals
Identifying & reinforcing Behaviors contributing to effective performance.
Identifying & Eliminating Behaviors leading to ineffective performance.
Identifying developing Behaviors and skills leading to optimal performance.


(i) Regularity of attendance (xii) Area of interest
(ii) Self Expression written & oral (xiii) Area of Suitability
(iii) Ability to work with others (xiv) Judgement skills
(iv) Leadership styles & abilities (xv) Integrity
(v) Initiative (xvi) Capability of assuming responsibility
(vi) Technical skills (xvii) Level of Acceptance by subordinates
(vii) Technical ability / Knowledge (xviii) Honesty and sincerity
(viii) Ability to grasp new things (xix) Thoughtfulness in the job and ogranisational
(ix) Ability to Reason (xx) Knowledge of systems and recording
(x) Originality & Resource fullness (xi) quality suggestions offered for improvement.
(xi) Creative Skills

The Main purpose of performance analysis: is to analyse the present performance of the multiple
view points, observe the GAP/Developmental needs and plan for development of the Employee.
A technique of HRD
Helps Employees to interact closely with his superiors
Such interaction helps subordinates to learn from superiors job related and
The process becomes a training /development/ educational process.

Appraisers: May be any person:
- Who has through knowledge of the job content.
- Contents to be appraised standards of content
- Who observes the employee while doing the job
- Appraiser should be capable of determining what is more
- important and what is relatively less important
- Should prepare reports and make judgement without Bias.



Supervisors: HOD or Managers, in turn reviewed by Divisional head etc
Peers: A person equal in ability, standing, rank, value, contemporary

Subordinates: Followed by developed countries provided a cordial relationship exists.

Employees Themselves : A self appraisal motivates employees.
: Thermax, Escorts, Wipro, BEM etc, implement this.

Uses of Service: To judge, speed in doing the job, accuracy, promptness, by users

Consultants. When all above appraisers not working out, consultants DO PA

Types of performance appraisal system


(i) Graphic Rating Scale . Behaviorally anchored rating
(ii) Ranking Method scales bars
(iii) Paired comparison method . Assessment centre
(iv) Forced Distribution method.
(v) Checklist Methods . Human Resource Accounting
Simple check list
Weighted check list
Forced choice method . Management by Objective.

(vi) Essay free from appraisal . Psychological Appraisal
(Vii) Group appraisal
(viii) Confidential Reports.

(i) Graphical Rating Scale:
Compares performance to absolute standard. Judgment about performance are required
on a scale known as linear rating scale/ simple rating scale.
Rating scale given in form 0,1,2,3,4,5. Appraiser assign points to each objective: Analytical
ability, creative ability etc points given to each character by the rater are added to find out overall
performance and ranking.

(ii) Ranking Method:
Rank as best to worst on Some characteristics. Bajaj, Tempo, BASF use this. Rank the
best and worst in the first stage and go on the same way with remaining, to complete rating of all

(iii) Paired comparison Method:


Followed where number of employee are less. Assign each employee a capital letter
A,B,C etc Pair the objectives, put them in a chart & each plotted pair against write in the letter of
employee who is found superior and given a positive comparison total and a percentage of total
positive evaluation. This positive comparison given in the paired comparison method has an
advantage over other comparative methods. (Ranking and forced Distribution)

(iv) Forced Distribution:
after assigning marks to the performance of each employee, Distributor in a pattern to
confirm to normal frequency Distribution.
The limitation is that, in a group if all are outstanding, it is difficult to place people at
lower category. Usha, JCT, SPL follow this method.

40% 20%
Average Below 10%
10%20% Average
Excel Good On
Ent satisfactory

(v) Checklist Method.
(i) Simple Checklist (ii) Weighted checklist (iii) Forced choice
Rater checks on a statement of
behavior of an employee as
positive / negative. Employee
performance is rated on
number of positive choice
Statement meaning may vary
Rater to Rater
Performance Ratings on
various Behaviour of
employee is given a weight
age. Weighted performance
score is compared with the
overall assessment standards to
find out the overall
performance of an employee.
Demerit: The consuming rater
may not fully know items
contributing to the successful
Large number of statements in
Groups are prepared. Each group
consists of four descriptive
statements concerning employee
behavior. Two Statements
favourable Two Statements,
Unvavourable. Appraiser to select
one statement that mostly
deserves employees behavior.
Demerit: Objective evaluation not
possible Rater may not fully
understand equally desirable/ un


(Vi) Critical incident method: A continuous rating method, instead of once in 6 months or 1 year
Annual Rating.

Supervisor records employee performance on critical incidents both positive and negative
characters on specially designed note book. Rating done based on notebook data. Reduces Bias
in evaluation short coming. Critical incidents not defined for comparison All capital (ITC,
VOLTAS, VST follow this) incident may not be knowing to supervisor.

(vi) Essay or Free form of appraisal: Manager is required to write a short essay describing each
employees performance during the rating period. This format emphasizes Evaluation of overall
performance. Based on strength and weakness of employee rather than specific job dimension.

Supervisory BIAS and HOLO effect required by asking supervisor to enumerate specific
examples of employee behavior.

To Enumerate Specific examples of employee behavior.

- Difficult to take decisions based on essays- No standard
- to compare- Evaluators may vary in their skills of essay
- Writing & the employee actual performance will depend
- On the writing skills of the appraiser.
BPL, BIRLA, 3M, Wheels India & BATA follow this method.

(Vii) Group Appraisal; An employee is appraised by a Group of appraisers. Group consist of
Immediate superiors, Managers, HODs of other Department, who have close contacts,
Consultants. HOD of the concerned employee will be chairman and immediate supervisor,
coordinator for group activities and he explains other members about job character, Demands,
standard of performance etc.
The Group rating against standard performance discussed with the concerned widely used by
Kinetic Honda, Birla, VXL, Bluestar used essentially for promotion, Demotion and

(Viii) Confidential Reports: A traditional method of Assessment based on observations,
Judgments and in turn, superior appraises. Superior does not allow the employee knows the
Report and his performance superior rates on his subordinates.

- Strengths - Attitude to work - punctuality - Character
- weakness - Sincerity - Attendance - Friendliness
- Intelligence - Commitment - Conduct - Cooperation etc
Followed by Most of PSU & Organizations, though suffer Limitations.




(i) Behaviourly Anchored Rating Scales: BARS
Combines Elements of Traditional Rating Scales and Critical Incident Methods
Using BARS: Job Behaviour from Critical Incidents Effective Ineffective Behaviours are
described more objectively.

Method: Individuals who are familiar with a particular job to identify its major components and
then rank and validate specific behavior for each of the components, then they rank and validate
specific behaviours for each of the components emphasis on pooling the thought process of
people who will use the scales both as Evaluators and Evaluees.

Step: I. Collect Critical Incidents: Supervisors job Holders Describe Effective In effective,
Indifference Behaviour Related to Job performance.

Step II. Identify performance Dimension: Convert Critical incidents into Key performance
dimension, Generally About 5 to 10 Dim for a job.
Step III. Reclassification of Incidents: Another Group to reclassify the Critical Incidents
Generated > 75% agreed ones selected.
Step IV. Assigning Scale value to the Incidents: 1 to 9 scale
1- Ineffective performance- Higher value- Effective performance.
Step V. Producing the Final Instrument; About Six/Seven incidents for each performance
dimension. Scale to its mean value.

ASSESSMENT CENTRE: First applied in the German Army in 1930s
Technique: It is a system or organization, where assessment of several individuals done by
various experts using different techniques some of the method used are : Role Playing, Case
Studies, Stimulation Exercise, In Basket, structured insight, Transactional analysis. This is not a
technique of performance appraisal by itself.

Human Resource Accounting: Deals with Cost and Contribution of human resources to the
organization. Employee contribution can be taken as positive when contribution is more than the
cost and cost of employee includes Cost of manpower, planning, recruitment, selection,
Induction, Placement, Training, Development, etc. Bank of Baroda, SAIL, ITC Ltd, Made
attempts to follow this method.

Management by Objectives: MBO focuses attention on particularly set goals that are tangible,
verifiable and measurable.

MBO is done along the following lines

Emphasis is on what must be accomplished rather than how it is to be accomplished.

- Subordinate and Superior jointly Determine Goals to be accomplished dring the
Appraisal period and level of performance to meet specific goals.
- During the appraisal period the superior and subordinates update and alter the
Goals as necessary to suit business environment both superior and subordinate


jointly discuss whether the subordinate achieved the Goals. If not identify reasons
for deviations viz. Market change, strike / lockout etc.

Performance goal setting, performance coaching and monitoring, performance evaluation
and performance feedback

Performance goal setting: To assets the Employees potential. This appraisal results used for

(i) Employee Placement

(ii) Training and development

(iii) Career planning and development

Tests Consists of Evaluation is conducted on the areas of

(i) In depth interviews (i) Employees intellectual abilities
(ii) Psychological tests (ii) Emotional stability
(iii) Consultation and discussions (iii) Motivational responses
(iv) Discussion with superior Subordinates
and peers
(iv) Reasoning and analytical abilities
(v) Reviews of other Evaluations (v) Interpretation and Judgment
(vi) Sociability
(vii) Ability to foresee the future
(viii) Ability to comprehend the shot comings



Performance Improvement: Actions by Managers to Improve based on
performance feedback
Compensation Adjustments: Helps in deciding pay raises and bonuses
based on merit through PA
Placement Decisions Promotions, Transfer, Demotion Based on
Training and Development PA may indicate need for training. Good
Needs PA indicates untapped potential
Career planning and development To decide on Specific Careers.
Staffing process deficiencies Good or Bad performance implies strength
and weakness of personnel department
Staffing is a procedure.
Informational Inaccurate: Poor PA may indicate error in job
information leads to unwanted hiring /
Training / counseling.


Job Design Errors PA indicate ill conceived job designs, PA
help in diagnosis of such errors
Equal Employment opportunity Accurate PA indicates a good system of
placement Internally.

External Challenges HR Department can provide Assistance on
outside work environment viz: Family,
Finance, Health and others.

Feedback to Human Resources Good/Bad indicates a healthy
performance of Human Resources function


(i) RATING BIASES : Since not verifiable by others. Biases are

a) Held effect : Rating tendency to depend excessively on
one trait or Behavioural Consideration
b) Error or Central Tendency : Rating all at middle point of scale.
c) The Leniency and Sickness: Higher rate or lower rates consistently
d) Personal Prejudice : Rating at lower end of disliked employees
affects career of employees.
e) The Recency Effect : Rating on the basis of Recent actions
rather on the whole activities- May be
(ii) NOT CONDUCTING PA and Post PA interviews
(iii) Most part of PA based on subjectivity
(iv) Less Reliability and validity of PA Techniques.
(v) Negative Rating affect inter personal industrial relations
(vi) Influence of External environment & Uncontrollable internal factors.
(vii) Feedback and post PA may have a setback on production
(viii) Management to punish rather than development of Employee
(ix) Especially potential appraisals are based on Guess work.
(x) Relationship of PA Rates & performance after promotion Not Significant
(xi) Some superior complete PA in a short time- Few minutes
(xii) Reliability of inter rater
(xiii) Un-pleasant situations in the feedback interview
(xiv) Superior not offering constructive suggestions to subordinates.
(xv) Superior sometimes confused over too many objections of PA some of them can be,
however overcome by appraising through computers.

By convening a open meeting with the appraisers to discuss performance of all Before,
during and after PA
Allow everyone to comment on others achievement and areas requiring improvement.


Appraiser to discuss openly with subordinates.
Appraises to be counseled on reasons for their performance and its consequences on
periodical basis.
Use of Bars instead of trait or personality attributes
Combine individual and group Rating.
- Classify in various Gardens and indicate employees or corrective actions.
Continuous improvement: Apprise continuously on the areas requiring improvements.
Multiple Raters: Use of multiple Raters minimize errors.
Training Appraisers/ Raters To bring in uniformity in certain and measurement of
Peer evaluations: Colleagues allowed to evaluate and allot suitable weightage
Rewards to accurate appraisers / Rater:
- Improves motivation to become objective in appraisal
- Improve value of appraisal
Since sometimes they consider PA is routine not for promotions & other career prospects.

(i) Change in Approach to Performance Management:
From controlling to development and term as performance analysis and
development later as performance management.
(ii) Emphasis on Documentation: fixing key performance key result areas and
set goals against each for all employees
(iii) Computer based performance Management: Use of computer software for
implementing Entire Management process
(iv) Collaborative Performance Management: Both Manager and subordinate
work towards Department / organization Goals with better understanding
with common collaborative mind.
(v) Customised performance management system: Based on employee skilled ,
Behaviour and job need. Design separate performance appraisal system for
each employee



Where an Individual is assessed by
1) Superiors 2) Subordinates 3) Peers 4) Internal Customers 5) External Customers.

Normally carried out once in a year/ half yearly.

Done anonymously by concerned person and the assessment collected by officials of HR

A competency Identification and development tool. If its process and dynamics are maintained
with better understanding.



(viii) Insights into strong and weak areas of candidates aim Viz: Performance roles,
Activities, Styles, Traits, qualities, competency ( Knowledge, Attitude, Skills) and
impact on others.
(ix) Identification of Developmental needs To plan objectively to suit features roles &
performance improvement needed For an individual or group of individuals
(x) Data generation. Serve as a objective basis for awards and others
(xi) Reinforcement of other change management efforts and organization effectiveness
directed to interventions.
(xii) Basis for performance linked pay or performance rewards.
(xiii) Alignment of Individual / Group goals with organization vision, value and goals

Basis for 360
Appraisal 360
Feedback Advantages - In addition to traditional
methods, the advantages are
Culture Building More objective than one person assessment of
trat qualities
Potential appraisal &
Adds objectivity & supplements traditional
Career planning and
Provides more acceptance feedback to
Succession planning and
In addition to all benefits of traditional PAS
satisfactory focus on internal customer is
Team Building Points out the supervisory BIAS of Traditional
Planning internal customer
satisfaction and improvement
Enhances customer service & Quality of Inputs
(from suppliers, consultants) Towards
organsiational benefits
Role clarity and increased
Provides scope for person to get multiple inputs
to improve role, personality, styles, ideas and
acceptability in a team
Participate and enhances quality and approach
of HR decisions.
Improves individuals attitude, imitative
customer related approach

Followed by GE, Hindustan Lever, Grasim, Colgate Palmolive, Hewlett- Packard.

Aligning performance outcome to career and succession planning

Career development is important for companies to create and sustain a continuous learning
environment. A study conducted by PWC of companies in finance, online services, hospitality,
real estate and high-tech industries suggests that companies that are successful at managing the
employee growth that accompanies business expansion and increased demand for their products
and services focus on recruitment, career development, culture orientation and communications.
These companies emphasize that employees are responsible for career management.


Employees, managers, human resource managers, and the company share the responsibility for
career planning.
Roles in Career Management:

action plan
Create Visibility
through Good
Seek Challenge
Request information
from other company
Develop systems to
support career
Develop culture that
supports career
Information and
Specialized services
(testing, counseling or
a) Employees Role:
The employees must approach their manager to initiate career-related discussion as part of the
personal development planning process. Regardless of how sophisticated the companys career
planning system is, employees should engage in career management actions.
Take the initiative to ask for feedback from managers and peers regarding their skill strengths
and weakness.
Identify their stage of career development and development needs.
Seek challenges by gaining exposure to a range of learning opportunities (sales assignments,
product design assignments, administrative assignments).
Interact with employees from different work groups inside and outside the company
(professional associations, task forces).
Create visibility through good performance.
b) Managers Role:
Regardless of the type of Career management system in the company, managers should play a
key role in career management process. Because managers are the primary source of information
about position openings, training courses and other developmental opportunities. To help
employees deal with career issues, managers need to be effective in four roles: Coach, appraiser,
advisor and referral agent.
Coach-Probe problems, interests, values, listen to the needs, define and clarify concerns.
Appraiser-Clarify company standards and job responsibilities and company needs and give
timely feedback.
Advisor-Generate options, experiences and relationships, assist in goal setting and provide
Referral Agent-Link to career management resources and follow up on career management plan.
c) Human Resource Managers Role:
HR managers should provide information or advice about training and development
opportunities. Also, HR managers should provide specialized services such as testing to
determine employees values, interests and skills, prepare employees for job searches and offer
counseling and career-related problems.


d) Companys Role:
Companies are responsible for providing employees with the resources needed to be successful
in career planning. These resources include specific programs as well as processes for career
Career workshops (seminars on how career management system works, self-assessment, goal
setting and helping managers understand and perform their roles in career management.
Infromation on career and job opportunities
Career planning workbooks (printed guides that direct employees through a series of exercises,
discussions and guidelines relating to career planning).
Career counseling (advice from a professionally trained counselor who specializes in working
with employees seeking assistance with career issues).
Career paths (planning job sequences and identifying skills needed for advancement within and
across job families, such as moving from technical jobs to management jobs).
The company also needs to monitor the career planning system to (ensure that managers and
employees are using the system as intended and evaluate whether the system is helping the
company meet its objectives,



Module VII
Employee Relations

Meaning and significance of employee relations
Industrial Relations means the relationship between employees and the Management in the day
to day working of the Industry.
Whole field of relationship that exists because of the necessary collaborations of men and
women in the employment process of an Industry Dale Yoder.
Whole field = Set of functions inter dependence involving, historical, economic, social, physical,
demographic, Technological, occupational political and Legal Variables)
Industrial Relations deal with either the Relationship between the State and the Employers and
worker organizations or the relation between occupational organization themselves
I.L.O (International labour Organisation)

Factors of Industrial Relations:
(i) Worker and their organizations
(ii) Employers and their organizations
(iii) Government Factors of Industrial relations
(1) Institutional Factors.
(2) Economic factors
(3) Technological factors.
(4) Social and cultural factors
(5) Political factors
(6) Governmental factors.

Employee relation in unionized and non-unionized organizations

(i) To promote and develop Congenial Labour Management Relations.
(ii) To enhance economic status of worker by improving wages, benefits, and by helping the
worker in Evolving sound budget.

(iii) To regulate production by minimizing industrial conflicts through step control.
(iv) To socialize industries by making Government as an employer
(v) To provide an opportunity to the workers to have a say in the management and decision
(vi) To Improve workers strength with a view to solve their problems through mutual
negotiations & collaboration with management.
(vii) To encourage and develop trade unions in order to improve workers strength.
(viii) To avoid industrial conflict and their consequences.

(ix) To extend and maintain Industrial democracy



Handling employee grievances. Employee discipline and domestic enquiry
- Discipline maintenance To regulate behavior or employees in a organization
- Rules and regulations are essential to maintain peace, prevent anarchy regulate
behavior of people and to hold things together.
- Moreover, employees prefer to work under Disciplined environment of fair rules protect,
individuals and organization & enable team work.
- D. Measure ensure just & equal treatment to all employees, efficient, Two way
communication , encourages cooperation & builds team pride.
- Discipline Training & that corrects, moulds, strengthens or perfects
- (Definitions) Control gained by Enforcing obedience, and
- It is punishment or chastisement


POSITIVE ASPECT self Discipline
consecutive Discipline
corrective or punitive approach
Employees believe in and support
discipline, adhere to the rules,
regulations, & desired standards of
Discipline takes the form of positive
support and reinforcement for approved
actions ad its aims to help the
individual in molding his behavior and
developing him in a corrective &
supportive manner
Employees some time do not believe in
a support discipline.
Hence do not adhere to rules,
regulations and desired standard of
As such disciplinary programme forces
& constraints the employees to obey
orders & function in accordance with
set rules& regulations through
Penalties and other forms forms of
Such an approach is called negative

To obtain a willing acceptance of the Rules, Regulations and procedures of an organization
so that the organizational goals may be obtained.
To impart an element of certainty despite several differences in informal behavior of partners
& related changes the organization.
To develop among the employees a spirit of tolerance and a desire to make adjustments
To give and seek direct and responsibility.
To create an atmosphere of respect to human relations & personality
To Increase the working efficiency and morale of the Employees so that their productivity is
stepped up & cost of production controlled.

INDISCLIPLINE: Disorderliness, Insubordination, not following Rules and
Regulations of an organization.


SYMPTOMS: Change in normal Behaviour Demand for over time lack
of performance for performance.

Types of Punishment are: 1. Oral warning
2. Written warning
3. Loss of privileges and fines
4. Punitive Suspension
5. With holding of increment
6. Demotion
7. Termination.


Grievance handling is resorted to settle disputes by systematic application of Grievance
A Labour agreement contain some form of Grievance, procedure , and if followed disputes
can be easily settled.
Grievance is well defined in a collective Bargaining agreement
It is usually restricted to violation of terms and conditions of employment.


- Violation of Law: Violation of company Rules
- Violation of intent of parties as stipulates during contract negotiations.
- A change in working condition & past company practices.
- A violation of Health and safety standards.

An employee when he/She beliefs that the Labour Agreement has been violated, files a
grievance, which need to be resolved according to a set of procedure. Grievance procedure
establishes the following

1. How the Grievance will be initiated.
2. Number of steps in the process
3. who will represent each party
4. The specific number of working days within which the grievance must be
taken to the next step in the hearing.

A typical Grievance procedure followed in a public sector ( Bangalore Based)


Stage 4
Complaint to






(i) Employee if wants to take his care from Stage to another at Stage I & II
within 5 days. Stage III within 10 days (Employee on leave period excluded)
(ii) IF the Employee has to leave the Department during working hours he
should take prior permission.
(iii) Officers handling Grievance at State I & II should involve the concerned
personnel officer of the Division. At Stage III to involve DGM Personnel in
the Discussion and Settlements.
(iv) Acknowledgement for receipt of Grievance including complaint should be
give to the Employee at early stage.
(v) At stage II & III any favourable settlement need to be implemented.

Large organizations do find to have more formal procedures involving a succession steps.
General Principle which should guide any procedure are

1. Grievance must be addressed promptly
2. Procedures and forms airing Grievance must be easy to utilize and well
understand by employees and their supervisors.
3. Ego clashes should not be allowed to impede the resolution of disputes.
4. Occurrence of such Grievance must be avoided.


WPM: Is considered as a mechanism where workers have a say in the Decision Making
process of an Enterprise formally

Objectives of Workers participation in Management:

Stage 3
Complaint to
Stage 2
Complaint to
Stage 1
Complaint to
Section Head


(i) To promote increased productivity for the advantage of the organization,
workers and society at large.
(ii) To provide a better understanding to employees about their role and place in the process of
attainment of organizational goals.
(iii) To satisfy the workers social and esteem needs.
(iv) To strengthen labour management co-operation and thus maintain industrial peace and
(v) To develop social education for effective solidarity among the working community and for
tapping latent human resources.
(vi) An ideological point of view to develop self management in industry
(vii) Enable improving efficiency of the company and establishing harmonious industrial
(viii) To build the most dynamic Human Resource.
(ix) To build the nation through entrepreneurship and economic development.

FORMS OF WPM: Vary from Industry to Industry & from country to country. WPM forms are:
(i) Works Committee (ii) Joint Management Council (iii) Joint Councils
(iv) Shop Councils.

(i) Works committee: The Industrial disputes act 1949 provides setting up of work committees as
a scheme for WPM.
Aim: to Set up Bodies to promote Measures for Maintaining harmonious relation into the work
place and sort out Employer / Employee difference of Opinion.
(ii) Joint Management Council: II five year plan recommended such council in 1957
(iii) Joint Councils: For the whole unit members are of that unit meet once in 4 months.
Functions of council enlarged in 1976.
(iv) Shop Councils: Represents each department or a shop in a unit. The decisions of various
shop councils will be referred to joint Council for consideration and approval.

Suggestions for the success of W.P.M
1. Mutual trust & faith among all the parties
5. All concerned in the WPM should
participate at all levels
2. Progressive Management to Recognize
Obligations & Responsibilities towards
workers and trade union
6. Effective communications between worker:
and Management & Consultations.
3. Strong, Democratic, Representative unions
to be represent cause of workers.
7. Should develop a favourable attitude the
Scheme PM
4. Objectives for participation by trade unions
and management formulated closely and
8 Management a Government to provide
training to all parties concerned for PM
9. Both the parties should be conscious of
Benefit of such schemes.



Industrial Relations means the relationship between employees and the Management in the day
to day working of the Industry.
Whole field of relationship that exists because of the necessary collaborations of men and
women in the employment process of an Industry Dale Yoder.
Whole field = Set of functions inter dependence involving, historical, economic, social, physical,
demographic, Technological, occupational political and Legal Variables)
Industrial Relations deal with either the Relationship between the State and the Employers and
worker organizations or the relation between occupational organization themselves
I.L.O (International labour Organisation)

(i) Worker and their organizations
(ii) Employers and their organizations
(iii) Government Factors of Industrial relations
(1) Institutional Factors.
(2) Economic factors
(3) Technological factors.
(4) Social and cultural factors
(5) Political factors
(6) Governmental factors.

(i) To promote and develop Congenial Labour Management Relations.
(ii) To enhance economic status of worker by improving wages, benefits, and by helping the
worker in Evolving sound budget.

(iii) To regulate production by minimizing industrial conflicts through step control.
(iv) To socialize industries by making Government as an employer
(v) To provide an opportunity to the workers to have a say in the management and decision
(vi) To Improve workers strength with a view to solve their problems through mutual
negotiations & collaboration with management.
(vii) To encourage and develop trade unions in order to improve workers strength.
(viii) To avoid industrial conflict and their consequences.

(ix) To extend and maintain Industrial democracy


(i) Communication is to be established between workers and the
management in order to bridge the Gap.
(ii) To establish Rapport between Manager and the Managed
(iii) To ensure creative contribution if trade union to avoid industrial
conflicts Safeguard interests of workers
- Avoid Industrial Conflicts Safeguard interests of workers
- Interests of management to avoid and ensure
Unhealthy, Unethical atmosphere does not exist / allowed.



(iv) To Lay down such considerations which may promote understanding creativity and
cooperativeness to raise industrial productivity and to ensure better workers participation?
Congenial: Pleasant / Suited / Agreeable


Attitude of management to trade unions and employees should be positive.
Attitude of employees toward management should also be positive and also towards trade
Management to have authority to enforce decisions affecting the interest of the trade unions
and employers
Management need not consult trade unions and employees on disciplinary cases.
Management should not influence employees joining /withdraw from union.
Trade unions should not enter into managerial activities not concerned to them.
Managers and supervisors to be empowered deal on disciplinary & Grievance cases
All collective bargaining agreements to be implemented and issues disposed off
Management to have rights to employ candidates to suit organizational strategies
All employees to attend training programmes planned
All Employees to accept transfer based on the companys transfer policy.
Employees and trade unions to participate in various decision making implementations at
different levels of company.
Employees resort to strike as a last attempt to give at-least 1 week notice to trade unions.
Similarly management should use the lockout technique only as a last resort and with a
minimum 1 week notice to trade union.


(i) Existence of strong, well organized & Democratic employees union.
(ii) Existence of sound and oraganised employers union.
(iii) Sprit of collective bargaining and willingness to resort to voluntary
(iv) Maintenance of Industrial Peace:
- Most essential and can be ensured by following these measures
- a. Machinery for prevention and settlement of disputes.
- Following legislative / conservative measures.
- Works committee, standing order, welfare offices, shop council, joint councils and
joint management council.
- Settlement method: Voluntary arbitration, conciliation, adjudication .


- b. Government should be provided with the authority of settling the industrial disputes
with settling between two parties voluntary arbitration.
- c. Provision for the Bipartite and Tripartite committees in order to evolve personnel
policies, code of conduct, code of discipline etc.
- d. Provision for the various committees to implement and evaluate
The collective bargaining arguments.
Court orders and judgments.
Awards of voluntary arbitration. Etc.

* Arbitration: Settlement of dispute by an Arbitrator (person authorized)
** Conciliation: Make situation calm, amenable (Responsive, Tractable) easy
to Handle
*** Adjudication: Decide judicially regarding a Claim/Demand.

Legal aspects of employee relations with reference to trade union Act
In this Act "the appropriate government" means, in relation to trade unions whose objects are not
confined to one State, the Central Government, and in relation to other trade unions, the State
Government, and, unless there is anything repugnant in the subject or context,-
(a) "executive" means the body, by whatever name called, to which the management of the
affairs of a trade union is entrusted;
(b) office-bearer" in the case of a trade union, includes any member of the executive thereof,
but does not include an auditor;
(c) "prescribed" means prescribed by regulations made under this Act;
(d) "registered office" means that office of a trade union which is registered under this Act as the
head office thereof;
(e) "registered trade union" means a trade union registered under this Act;
(f) "Registrar" means-
(i) a Registrar of Trade Unions appointed by the appropriate government under section 3,
and includes any Additional or Deputy Registrar of Trade Unions, and
(ii) in relation to any trade union, the Registrar appointed for the state in which the head
or registered office, as the case may be, of the trade union is situated;
(g) "trade dispute" means any dispute between employers and workmen, or between workmen
and workmen, or between employers and employers which is connected with the employment or
non-employment, or the terms of employment or the conditions of labor, of any person, and
"workmen" means all persons employed in trade or industry whether or not in the employment of
the employer with whom the trade dispute arises; and


(h) "trade union" means any combination, whether temporary or permanent, formed primarily for
the purpose of regulating the relations between workmen and employers or between workmen
and workmen, or between employers and employers, or for imposing restrictive conditions on
the conduct of any trade or business, and includes any federation of two or more trade unions:
PROVIDED that this Act shall not affect-
(i) any agreement between partners as to their own business;
(ii) any agreement between an employer and those employed by him as to such employment; or
(iii) any agreement in consideration of the sale of the goodwill of a business or of instruction in
any profession, trade or handicraft.
The appropriate government shall appoint a person to be the Registrar of Trade Unions for each
(2) The appropriate government may appoint as many Additional and Deputy Registrars of Trade
Unions as it thinks fit for the purpose of exercising and discharging, under the superintendence
and direction of the Registrar, such powers and functions of the Registrar under this Act as it
may, by order, specify and define the local limits within which any such Additional or Deputy
Registrar shall exercise and discharge the powers and functions so specified.
(3) Subject to the provisions of any order under sub-section (2), where an Additional or Deputy
Registrar exercises and discharges the powers and functions of a Registrar in an area within
which the registered office of a trade union is situated, the Additional or Deputy Registrar shall
be deemed to be the Registrar in relation to the trade union for the purposes of this Act.
4. Mode of registration
(1) Any seven or more members of a trade union may, by subscribing their names to the rules of
the trade union and by otherwise complying with the provisions of this Act with respect to
registration, apply for registration of the trade union under this Act.
(2) Where an application has been made under sub-section (1) for the registration of a trade
union, such application shall not be deemed to have become invalid merely by reason of the fact
that, at any time after the date of the application, but before the registration of the trade union,
some of the applicants, but not exceeding half of the total number of persons who made the
application, have ceased to be members of the trade union or have given notice in writing to the
Registrar dissociating themselves from the application.
5. Application for registration
(1) Every application for registration of a trade union shall be made to the Registrar and shall be
accompanied by a copy of the rules of the trade union and a statement of the following
particulars, namely:-


(a) the names, occupations and addresses of the members making application;
(b) the name of the trade union and the address of its head office; and
(c) the titles, names, ages, addresses and occupations of the office-bearers of the trade
(2) Where a trade union has been in existence for more than one year before the making of an
application for its registration, there shall be delivered to the Registrar, together with the
application, a general statement of the assets and liabilities of the trade union prepared in such
form and containing such particulars as may be prescribed.
6. Provisions to be contained in the rules of a trade union
A trade union shall not be entitled to registration under this Act, unless the executive thereof is
constituted in accordance with the provisions of this Act, and the rules thereof provide for the
following matters, namely:-
(a) the name of trade union;
(b) the whole of the objects for which the trade union has been established;
(c) the whole of the purposes for which the general funds of the trade union shall be applicable,
all of which purposes shall be purposes to which such funds are lawfully applicable under this
(d) the maintenance of a list of the members of the trade union and adequate facilities for the
inspection thereof by the office-bearers and members of the trade union;
(e) the admission of ordinary members who shall be persons actually engaged or employed in an
industry with which the trade union is connected, and also the admission of the number of
honorary or temporary members as office bearers required under section 22 to form the executive
of the trade union;
the payment of a subscription by members of the trade union which shall be not less than twenty-
five naye paise per month per member;
(f) the conditions under which any member shall be entitled to any benefit assured by the rules
and under which any fine or forfeiture may be imposed on the members;
(g) the manner in which the rules shall be amended, varied or rescinded;
(h) the manner in which the members of the executive and the other office-bearers of the trade
union shall be appointed and removed;


(i) the safe custody of the funds of the trade union, and annual audit, in such manner as may be
prescribed, of the accounts thereof, and adequate facilities for the inspection of the account
books by the office-bearers and members of the trade union; and
(j) the manner in which the trade union may be dissolved.
7. Power to call for further particulars and to require alternations of names
(1) The Registrar may call for further information for the purpose of satisfying himself that any
application complies with the provisions of section 5, or that the trade union is entitled to
registration under section 6, and may refuse to register the trade union until such information is
(2) If the name under which a trade union is proposed to be registered is identical with that by
which any other existing trade union has been registered or, in the opinion of the Registrar, so
nearly resembles such name as to be likely to deceive the public or the members of either trade
union, the Registrar shall require the persons applying for registration to alter the name of the
trade union stated in the application, and shall refuse to register the union until such alteration
has been made.
8. Registration
The Registrar, on being satisfied that the trade union has complied with all the requirements of
this Act in regard to registration, shall register the trade union by entering in a register, to be
maintained in such form as may be prescribed, the particulars relating to the trade union
contained in the statement accompanying the application for registration.
9. Certificate of registration
The Registrar, on registering a trade union under section 8, shall issue a certificate of registration
in the prescribed form which shall be conclusive evidence that the trade union has been duly
registered under this Act.
10. Cancellation of registration
A certificate of registration of a trade union may be withdrawn or cancelled by the Registrar-
(a) on the application of the trade union to be verified in such manner as may be prescribed:
(b) if the Registrar is satisfied that the certificate has been obtained by fraud or mistake or that
the trade union has ceased to exist or has willfully and after notice from the Registrar
contravened by provision of this Act or allowed any rule to continue in force which is
inconsistent with any such provision, or has rescinded any rule providing for any matter
provision for which is required by section 6:


PROVIDED that not less than two months previous notice in writing specifying the ground on
which it is proposed to withdraw or cancel the certificate shall be given by the Registrar to the
Trade Union before the certificate is withdrawn or cancelled otherwise than on the application of
the trade union.
11. Appeal
(1) Any person aggrieved by any refusal of the Registrar to register a trade union or by the
withdrawal or cancellation of a certificate of registration may, within such period as may be
prescribed, appeal-
(a) where the head office of the trade union is situated within the limits of a Presidency
town to the High Court, or
(b) where the head office is situated in any other area, to such Court, not inferior to the
court of an additional or assistant Judge of a principal civil court of original jurisdiction,
as the
[appropriate government] may appoint in this behalf for that area.
(2) The appellate court may dismiss the appeal, or pass an order directing the Registrar to
register the union and to issue a certificate of registration under the provisions of section 9 or
setting aside the order for withdrawal or cancellation of the certificate, as the case may be, and
the Registrar shall comply with such order.
(3) For the purpose of an appeal under sub-section (1), an appellate court shall, so far as may be,
follow the same procedure and have the same powers as it follows and has when trying a suit
under the Code of Civil Procedure, 1908, (5 of 1908) and may direct by whom the whole or any
part of the costs of the appeal shall be paid, and such costs shall be recovered as if they had been
awarded in a suit under the said Code.
(4) In the event of the dismissal of an appeal by any court appointed under clause (b) of sub-
section (1) the person aggrieved shall have a right of appeal to the High Court, and the High
Court shall, for the purpose of such appeal, have all the powers of an appellate court under sub-
sections (2) and (3), and the provisions of those sub-sections shall apply accordingly.
12. Registered office
All communications and notices to a registered trade union may be addressed to its registered
office. Notice of any change in the address of the head office shall be given within fourteen days
of such change to the Registrar in writing, and the changed address shall be recorded in the
register referred to in section 8.
Industrial employment standing orders Act
Industrial Employment (Standing Orders) Act, 1946
. Short title, extent and application


(1) This Act may be called the Industrial Employment (Standing Orders) Act, 1946.
(2) It extends to
[the whole of India.]
[(3) It applies to every industrial establishment wherein one hundred or more workmen are
employed, or were employed on any day of the preceding twelve months:
PROVIDED that the appropriate government may, after giving not less than two months notice
of its intention so to do, by notification in the Official Gazette, apply the provisions of this Act to
any industrial establishment employing such number of persons less than one hundred as may be
specified in the notification.].
[(4) Nothing in this Act shall apply to-
(i) any industry to which the provisions of Chapter VII of the Bombay Industrial
Relations Act, 1946 (11 of 1947) apply; or
(ii) any industrial establishment to which the provisions of the Madhya Pradesh Industrial
Employment (Standing Orders) Act, 1961 (26 of 1961) apply:
PROVIDED that notwithstanding anything contained in the Madhya Pradesh Industrial
Employment (Standing Orders) Act, 1961 (26 of 1961), the provisions of this Act shall apply to
all industrial establishments under the control of the Central Government.]
2. Interpretation
In this Act, unless there is anything repugnant in the subject or context-
[(a) "appellate authority" means an authority appointed by the appropriate government by
notification in the Official Gazette to exercise in such area as may be specified in the notification
the functions of an appellate authority under this Act:
PROVIDED that in relation to an appeal pending before an Industrial Court or other authority
immediately before the commencement of the Industrial Employment (Standing Orders)
Amendment Act, 1963 (39 of 1963), that court or authority shall be deemed to be the appellate
(b) "appropriate government" means in respect of industrial establishments under the control of
the Central Government or a Railway administration or in a major port, mine, or oil-field, the
Central Government, and in all other cases, the State Government:
[PROVIDED that where any question arises as to whether any industrial establishment is under
the control of the Central Government, that Government may, either on a reference made to it by
the employer or the workman or a trade union or other representative body of the workmen, or
on its own motion and after giving the parties an opportunity of being heard, decided the
question and such decision shall be final and binding on the parties;]


[(c) "Certifying Officer" means a Labor Commissioner or a Regional Labor Commissioner, and
includes any other officer appointed by the appropriate government, by notification in the
Official Gazette, to perform all or any of the functions of a Certifying Officer under this Act;]
(d) "employer" means the owner of an industrial establishment to which this Act for the time
being applies, and includes-
(i) in a factory, any person named under
[clause (f) of sub-section (1) of section 7 of the
Factories Act, 1948 (63 of 1948), as manager of the factory;
(ii) in any industrial establishment under the control of any department of any
Government in India, the authority appointed by such Government in this behalf, or
where no authority is so appointed, the head of the department;
(iii) in any other industrial establishment, any person responsible to the owner for the
supervision and control of the industrial establishment;
(e) "industrial establishment" means-
(i) an industrial establishment as defined in clause (ii) of section 2 of the Payment of
Wages Act, 1936 (4 of 1936); or
[(ii) a factory as defined in clause (m) of section 2 of the Factories Act, 1948 (63 of
1948); or]
(iii) a railway as defined in clause (4) of section 2 of the Indian Railways Act, 1890 (9 of
1890), or
(iv) the establishment of a person who, for the purpose of fulfilling a contract with the
owner of any industrial establishment, employees workmen:
(f) "prescribed" means prescribed by rules made by the appropriate government under this Act;
(g) "standing orders" means rules relating to matters set out in the Schedule;
(h) "trade union" means a trade union for the time being registered under the Indian Trade
Unions Act, 1926 (16 of 1926);
[(i) "wages" and "workman" have the meanings respectively assigned to them in clauses (rr) and
(s) of section 2 of the Industrial Disputes Act, 1947 (14 of 1947).]
3. Submission of draft standing orders
(1) Within six months from the date on which this Act becomes applicable to an industrial
establishment, the employer shall submit to the Certifying Officer five copies of the draft
standing orders proposed by him for adoption in his industrial establishment.


(2) Provision shall be made in such draft for every matter set out in the Schedule which may be
applicable to the industrial establishment, and where model standing orders have been
prescribed, shall be, so far as is practicable, in conformity with such model.
(3) The draft standing orders submitted under this section shall be accompanied by a statement
giving prescribed particulars of the workmen employed in the industrial establishment including
the name of the trade union, if any, to which they belong.
(4) Subject to such conditions as may be prescribed, a group of employers in similar industrial
establishments may submit a joint draft of standing orders under this section.
Comment: The Act does not say that on such certification, the Standing Orders acquire statutory
effect or become part of the statute. It can certainly not be suggested that by virtue of
certification, they get metamorphosed into delegated/subordinate legislation. Though these
Standing Orders are undoubtedly binding upon both the employer and the employees and
constitute the conditions of service of the employees, it appears difficult to say, on principle, that
they have statutory force. The Rajasthan State Road Transport Corporation and another etc.
etc., Appellants v. Krishna Kant., AIR 1995 SUPREME COURT 1715
Conditions for certification of standing orders
Standing orders shall be certifiable under this Act if-
(a) provision is made therein for every matter set out in the Schedule which is applicable to the
industrial establishment, and
(b) the standing orders are otherwise in conformity with the provisions of this Act, and it
be the function] of the Certifying Officer or appellate authority to adjudicate upon the fairness or
reasonableness of the provisions of any standing orders.
5. Certification of standing orders
(1) On receipt of the draft under section 3, the Certifying Officer shall forward a copy thereof to
the trade union, if any, of the workmen, or where there is no such trade union, to the workmen in
such manner as may be prescribed, together with a notice in the prescribed form requiring
objections, if any, which the workmen may desire to make to the draft standing orders to be
submitted to him within fifteen days from the receipt of the notice.
(2) After giving the employer and the trade union or such other representative of the workmen as
may be prescribed, an opportunity of being heard, the Certifying Officer shall decide whether or
no any modification of or addition to the draft submitted by the employer is necessary to render
the draft standing orders certifiable under this Act, and shall make an order in writing
(3) The Certifying Officer shall thereupon certify the draft standing orders, after making any
modification therein which his order under sub-section (2) may require, and shall within seven


days thereafter send copies of the certified standing order authenticated in the prescribed manner
and of his order under sub-section (2) to the employer and to the trade union or other prescribed
representatives of the workmen
[Any employer, workmen, trade union or other prescribed representatives of the workmen]
aggrieved by the order of the Certifying Officer under sub-section (2) of section 5 may, within
[thirty days] from the date on which copies are sent under sub-section (3) of that section, appeal
to the appellate authority, and the appellate authority, whose decisions shall be final, shall by
order in writing confirm the standing orders either in the form certified by the Certifying Officer
or after amending the said standing orders by making such modifications thereof or additions
thereto as it thinks necessary to render the standing orders certifiable under this Act.
(2) The appellate authority shall, within seven days of its order under sub-section (1), send
copies thereof of the Certifying Officer, to the employer and to the trade union or other
prescribed representatives of the workmen, accompanied, unless it has confirmed without
amendment the standing orders as certified by the Certifying Officer, by copies of the standing
orders as certified by it and authenticated in the prescribed manner.
7. Date of operation of standing orders
Standing orders shall, unless an appeal is preferred under section 6, come into operation on the
expiry of thirty days from the date on which authenticated copies thereof are sent under sub-
section (3) of section 5, or where an appeal as aforesaid is preferred, on the expiry of seven days
from the date on which copies of the order of the appellate authority are sent under sub-section
(2) of section 6.
8. Register of standing orders
A copy of all standing orders as finally certified under this Act shall be field by the Certifying
Officer in a register in the prescribed form maintained for the purpose, and the Certifying Officer
shall furnish a copy thereof to any person applying therefor on payment of the prescribed fee.
9. Posting of standing orders
The text of the standing order as finally certified under this Act shall be prominently posted by
the employer in English and in the language understood by the majority of his workmen on
special boards to be maintained for the purpose at or near the entrance through which the
majority of the workmen enter the industrial establishment and in all departments thereof where
the workmen are employed.
. Duration and modification of standing orders
(1) Standing orders finally certified under this Act shall not, except on agreement between the
employer and the workmen,
[or a trade union or other representative body of the workmen] be


liable to be modification until the expiry of six months from the date on which the standing
orders or the last modifications thereof came into operation.
[(2) Subject to the provisions of sub-section (1), an employer or workman
[or a trade union or
other representative body of the workmen may apply to the Certifying Officer to have the
standing orders modified and such application shall be accompanied by five copies of the
modifications proposed to be made, and where such modifications are proposed to be made by
agreement between the employer and the workmen
[or a trade union or other representative
body of the workmen], a certified copy of that agreement shall be filed along with the
(3) The foregoing provisions of this Act shall apply in respect of an application under sub-
section (2) as they apply to the certification of the first standing orders.
[(4)Nothing contained in sub-section (2) shall apply to an industrial establishment in respect of
which the appropriate government is the Government of the State of Gujarat or the Government
of the State of Maharashtra.]
Certifying Officers and appellate authorities to have powers of civil court
(1) Every Certifying Officer and appellate authority shall have all the powers of a civil court for
the proposes of receiving evidence, administering oaths, enforcing the attendance of witnesses,
and compelling the discovery and production of documents, and shall be deemed to be a civil
court within the meaning of
[sections 345 and 346 of the Code of Criminal Procedure, 1973 (2
of 1974).]
[(2) Clerical or arithmetical mistakes in any order passed by Certifying Officer or appellate
authority, or errors arising therein from any accidental slip or omission may, at any time, be
corrected by that officer or authority or the successor in office of such officer or authority, as the
case may be.]
12. Oral evidence in contradiction of standing orders not admissible
No oral evidence having the effect of adding to or otherwise varying or contradicting standing
order as finally certified under this Act shall be admitted in any court.
12A. Temporary application of model standing orders
(1) Notwithstanding anything contained in sections 3 to 12, for the period commencing on the
date on which this Act becomes applicable to an industrial establishment and ending with the
date on which the standing orders as finally certified under this Act come into operation under
section 7 in that establishment, the prescribed model standing order shall be deemed to be
adopted in that establishment, and the provisions of section 9, sub-section (2) of section 13 and
section 13A shall apply to such model standing orders as they apply to the standing orders so


(2) Nothing contained in sub-section (1) shall apply to an industrial establishment in respect of
which the appropriate government is the Government of the State of Gujarat or the Government
of the State of Maharashtra.]
SCHEDULE I : Model Standing Orders in Respect of Industrial Establishments not being
Industrial Establishments in Coal Mines
1.These orders shall come into force on ________________________
Classification of workmen.
2. (a) Workmen shall be classified as,
(1) permanent,
(2) probationers,
(3) badlis,
(4) temporary,
(5) casual,
(6) apprentices
(b) A "permanent" workman is a workman who has been engaged on a permanent basis and
includes any person who has satisfactorily completed a probationary period of three months in
the same or another occupation in the industrial establishment, including breaks due to sickness,
accident, leave, lock-out, strike (not being an illegal strike) or involuntary closure of the
(c) A "probationer" is a workman who is provisionally employed to fill a permanent vacancy in a
post and has not completed three months service therein. If a permanent employee is employed
as a probationer in a new post he may, at any time during the probationary period of three
months, be reverted to his previous permanent post.
(d) A "badly" is a workman who is appointed in the post of a permanent workman or probationer
who is temporarily absent.
(e) A "temporary workman" is a workman who has been engaged for work which is of an
essentially temporary nature likely to be finished within a limited period.
(f) A "casual" workman is a workman whose employment is of a casual nature.
(g) An "apprentice" is a learner who is paid an allowance during the period of his training.


3. Tickets
(1) Every workman shall be given a permanent ticket unless he is a probationer, badly,
temporary worker or apprentice.
(2) Every permanent workman shall be provided with a departmental ticket showing his number,
and shall on, being required to do so, show it to any person authorized by the manager to inspect
(3) Every badly shall be provided with the badly card on which shall be entered the days on
which he has worked in the establishment, and which shall be surrendered if he obtains
permanent employment.
(4) Every temporary workman shall be provided with a temporary ticket which he shall
surrender on his discharge.
(5) Every casual worker shall be provided with a casual card on which shall be entered the days
on which he has worked in the establishment.
(6) Every apprentice shall be provided with an apprentice card, which shall be surrendered if he
obtains permanent employment.
4. Publication of working time
The periods and hours of work for all classes of workers in each shift shall be exhibited in
English and in the principal languages of workmen employed in the establishment on notice
boards maintained at or near the main entrance of the establishment and at time-keepers office,
if any.
5. Publication of holidays and pay days
Notices specifying (a) the days observed by the establishment as holidays, and (b) pay days shall
be posted on the said notice-boards.
6. Publication of wage rates
Notices specifying the rates of wages payable to all classes of workmen and for the classes of
work shall be displayed on the said notice boards.
7. Shift working
More than one shift may be worked in a department or departments or any section of a
department of the establishment at the discretion of the employer. If more than one shift is
worked, the workmen shall be liable to be transferred from one shift to another. No shift working
shall be discontinued without two months notice being given in writing to the workmen prior to
such discontinuance, provided that no such notice shall be necessary if the closing of the shift is


under an agreement with the workmen affected. If as a result of the discontinuance of the shift
working, any workmen are to be retrenched, such retrenchment shall be effected in accordance
with the provisions of the Industrial Disputes Act, 1947 (14 of 1947) and the rules made
thereunder. If shift working is restarted, the workmen shall be given notice and re-employed in
accordance with the provisions of the said Act and the said Rules.
[Notice of changes in shift working
Any notice of discontinuance or of restarting of a shift working required by Standing Order 7
shall be in
[Form IVA] and shall be served in the following manner, namely:-
The notice shall be displayed conspicuously by the employer on a notice board at the main
entrance to the establishment
PROVIDED that where any registered trade union of workmen exists, a copy of the notice shall
also be served by registered post on the secretary of such union.]
8. Attendance and late coming
All workmen shall be at work at the establishment at the time fixed and notified under paragraph
4. Workmen attending late will be liable to the deductions provided for in Payment of Wages
Act, 1936.
9. Leave
(1) Holidays with pay will be allowed as provided for in
[Chapter VIII of the Factories Act,
1948], and other holidays in accordance with law, contract, custom and usage.
(2) A workman who desires to obtain leave of absence shall apply to the
[employer or any other
officer of the industrial establishment specified in this behalf by the employer], who shall issue
orders on the application within a week of its submission or two days prior to the commencement
of the leave applied for, whichever is earlier, provided that if the leave applied for is to
commence on the date of the application or within three days thereof, the order shall be given on
the same day. If the leave asked for is granted, a leave pass shall be issued to the worker. If the
leave is refused or postponed, the fact of such refusal or postponement and the reasons therefor
shall be recorded in writing in a register to be maintained for the purpose, and if the worker so
desires, a copy of the entry in the register shall be supplied to him. If the workman after
proceeding on leave desires an extension thereof, he shall apply to the
[employer or the officer
specified in this behalf by the employer] who shall send a written reply either granting or
refusing extension of leave to the workman if his address is available and if such reply is likely
to reach him before the expiry of the leave originally granted to him
(3) If, the workman remains absent beyond the period of leave originally granted or subsequently
extended, he shall lose is lien on his appointment unless he (a) returns within 8 days of the expiry
of the leave and (b) explains to the satisfaction of the
[employer or the officer specified in this


behalf by the employer] his inability to return before the expiry of his leave. In case the workman
loses his lien on his appointment, he shall be entitled to be kept on the badly list.
10. Casual leave
A workman may be granted casual leave of absence with or without pay not exceeding 10 days
in the aggregate in a calendar year. Such leave shall not be for more than three days at a time
except in case of sickness. Such leave is intended to meet special circumstances which cannot be
foreseen. Ordinarily, the previous permission of the head of the department in the establishment
shall be obtained before such leave is taken, but when this is not possible the head of the
department shall, as soon as may be practicable, be informed in writing of the absence from and
of the probable duration of such absence.
11. Payment of wages
(1) Any wages, due to the workmen but not paid on the usual pay day on account of their being
unclaimed, shall be paid by the employer on an unclaimed wage pay day in each week, which
shall be notified on the notice-boards as aforesaid.
(2) All workmen will be paid wages on a working day before the expiry of the seventh or the
tenth day after the last day of the wage period in respect of which the wages are payable,
according as the total number of workmen employed in the establishment does not or does
exceed one thousand.
12. Stoppage of work
(1) The employer may, at any time, in the event of fire, catastrophe, breakdown of machinery or
stoppage of power supply, epidemics, civil commotion or other cause beyond his control, stop
any section or sections of the establishment, wholly or partially for any period or periods without
(2) In the event of such stoppage during working hours, the workmen affected shall be notified
by notices put upon the notice board in the department concerned,
[and at the office of the
employer and at the time keepers office if any], as soon as practicable, when work will be
resumed and whether they are to remain or leave their place of work. The workmen shall not
ordinarily be required to remain for more than two hours after the commencement of the
stoppage. If the period of detention does not exceed one hour the workmen so detained shall not
be paid for the period of detention. If the period of detention exceeds one hour, the workmen so
detained shall be entitled to receive wages for the whole of the time during which they are
detained as a result of the stoppage. In the case of piece-rate workers, the average daily earning
for the previous month shall be taken to be the daily wage. No other compensation will be
admissible in case of such stoppage. Whenever practicable reasonable notice shall be given of
resumption of normal work.
(3) In case where workmen are laid off for short periods on account of failure of plant or a
temporary curtailment of production, the period of unemployment shall be treated as compulsory


leave either with or without pay, as the case may be. When, however, workmen have to be laid
off for an indefinitely long period, their services may be terminated after giving them due notice
or pay in lieu thereof.
(4) The employer may in the event of a strike affecting either wholly or partially any section or
department of the establishment close down either wholly or partially such section or department
and any other section or department affected by such closing down. The fact of such closure
shall be notified by notices put on the notice board in the section or department concerned and in
the time keepers office, if any, as soon as practicable. The workmen concerned shall also be
notified by a general notice, prior to resumption of work, as to when work will be resumed.
13. Termination of employment
(1) For terminating employment of a permanent workman, notice in writing shall be given either
by the employer or the workman-one months notice in the case of monthly rated workmen and
two weeks notice in the case of other workmen; one months or two weeks pay, as the case
may be, may be paid in lieu of notice.
(2) No temporary workman whether monthly-rated, weekly-rated or piece-rated and no
probationer or badly shall be entitled to any notice or pay in lieu thereof if his services are
terminated, but the services of a temporary workman shall not be terminated as a punishment
unless he has been given an opportunity of explaining the charges of misconduct alleged against
him in the manner prescribed in Paragraph 14.
(3) Where the employment of any workman is terminated, the wages earned by him and other
dues, if any, shall be paid before the expiry of the second working day from the day on which his
employment is terminated.
14. Disciplinary action for misconduct
(1) A workman may be fined up to two per cent of his wages in a month for the following acts
and omissions, namely:
1 ______________________
3 ______________________
4 ______________________
(2) A workman may be suspended for a period not exceeding four days at a time, or dismissed
without notice or any compensation in lieu of notice, if he is found to be guilty of misconduct.
(3) The following acts and omissions shall be treated as misconduct,-


(a) willful insubordination or disobedience, whether alone or in combination with others, to any
lawful and reasonable order of a superior,
(b) theft, fraud or dishonesty in connection with the employers business or property,
(c) willful damage to or loss of employers goods or property,
(d) taking or giving bribes or any illegal gratification,
(e) habitual absence without leave or absence without leave for more than 10 days,
(f) habitual late attendance,
(g) habitual breach of any law applicable to the establishment,
(h) riotous or disorderly behavior during working hours at the establishment or any act
subversive of discipline,
(i) habitual negligence or neglect of work,
(j) frequent repetition of any act or omission for which a fine may be imposed to a maximum of
2 per cent of the wages in a month,
(k) striking work or inciting others to strike work in contravention of the provisions of any law,
or rule having the force of law.
[(4) (a) Where a disciplinary proceeding against a workman is contemplated or is pending or
where criminal proceedings against him in respect of any offence are under investigation or trial
and the employer is satisfied that it is necessary or desirable to place the workman under
suspension, he may, by order in writing suspend him with effect from such date as may be
specified in the order. A statement setting out in detail the reasons for such suspension shall be
supplied to the workman within a week from a date of suspension.
[(b) A workman who is placed under suspension shall be paid subsistence allowance in
accordance with the provisions of section 10A of the Act.]
[(ba) In the inquiry, the workman shall be entitled to appear in person or to be represented by
an office bearer of a trade union of which he is a member.
(bb) The proceedings of the inquiry shall be recorded in Hindi or in English or the language of
the State where the industrial establishment is located, whichever is preferred by the workman.
(bc) The proceedings of the inquiry shall be completed within a period of three months:
PROVIDED that the period of three months may, for reasons to be recorded in writing, be
extended by such further period as may be deemed necessary by the inquiry officer.]


(c) If on the conclusion of the inquiry or, as the case may be, of the criminal proceedings, the
workman has been found guilty of the charges framed against him and it is considered, after
giving the workman concerned a reasonable opportunity of making representation on the penalty
proposed, that an order of dismissal or suspension or fine or stoppage of annual increment or
reduction in rank would meet the ends of justice, the employer shall pass an order accordingly:
PROVIDED that when an order of dismissal is passed under this clause, the workman shall be
deemed to have been absent from duty during the period of suspension and shall not be entitled
to any remuneration for such period, and the subsistence allowance already paid to him shall not
be recovered:
PROVIDED FURTHER that where the period between the date on which the workman was
suspended from duty pending the inquiry or investigation or trial and the date on which an order
of suspension was passed under this clause exceeds four days, the workman shall be deemed to
have been suspended only for four days or for such shorter period as is specified in the said order
of suspension and for the remaining period he shall be entitled to the same wages as he would
have received if he had not been placed under suspension, after deducting the subsistence
allowance paid to him for such period:
PROVIDED ALSO that where an order imposing fine or stoppage of annual increment or
reduction in rank is passed under this clause, the workman shall be deemed to have been on duty
during the period of suspension and shall be entitled to the same wages as he would have
received if he had not been placed under suspension, after deducting the subsistence allowance
paid to him for such period:
PROVIDED ALSO that in the case of a workman to whom the provisions of clause (2) of article
311 of the Constitution apply, the provisions of that article shall be complied with.
(d) If on the conclusion of the inquiry, or as the case may be, of the criminal proceedings, the
workman has been found to be not guilty of any of the charges framed against him, he shall be
deemed to have been on duty during the period of suspension and shall be entitled to the same
wages as he would have received if he had not been placed under suspension after deducting the
subsistence allowance paid to him for such period.
(e) The payment of subsistence allowance under this standing order shall be subject to the
workman concerned not taking up any employment during the period of suspension.]
[(5)] In awarding punishment under this standing order, the
[authority imposing the
punishment] shall take into account any gravity of the misconduct, the previous record, if any, of
the workman and any other extenuating or aggravating circumstances, that may exist. A copy of
the order passed by the
[authority imposing the punishment] shall be supplied to the workman
[(6) (a) A workman aggrieved by an order imposing punishment, may within twenty-one days
from the date of receipt of the order, appeal to the appellate authority.


(b) The employer shall, for the purposes of clause (a), specify the appellate authority.
(c) The appellate authority, after giving an opportunity to the workman of being heard, shall pass
such order as he thinks proper on the appeal within fifteen days of its receipt and communicate
the same to the workman in writing.]
15. Complaints
All complaints arising out of employment including those relating to unfair treatment or
wrongful exaction on the part of the employer or his agent, shall be submitted to the manager or
other person specified in this behalf with the right of appeal to the employer.
16. Certificate on termination of service
Every permanent workman shall be entitled to a service certificate at the time of his dismissal,
discharge or retirement from service.
17. Liability of
[employer] of the establishment shall personally be held responsible for the proper and
faithful observance of the standing orders.
17A. (1) Any person desiring to prefer an appeal in pursuance of sub-section (1) of section 6 of
the Act shall draw up a memorandum of appeal setting out the ground of appeal and forward it in
quintuplicate to the appellate authority accompanied by a certified copy of the standing orders,
amendments, or modifications, as the case may be.
(2) The appellate authority shall after giving the appellant an opportunity of being heard, confirm
the standing orders, amendments or modifications as certified by the certifying officer unless it
considers that there are reasons for giving the other parties to the proceedings a hearing before a
final decision is made in the appeal.
(3) Where the appellate authority does not confirm the standing orders, amendments or
modifications it shall fix a date for the hearing of the appeal and direct notice thereof to be given-
(a) where the appeal is filed by the employer or a workman, to trade unions of the
workman of the industrial establishments, and where there are no such trade unions to the
representatives of workman elected under clause (b) or rule 6, or as the case may be to
the employer;
(b) where the appeal is filed by a trade union to the employer and all other trade unions of
the workmen of the industrial establishment;
(c) where the appeal is filed by the representatives of the workmen, to the employer and
any other workman whom the appellate authority joins as a party to the appeal.


(4) The appellant shall furnish each of the respondents with a copy of the memorandum of
(5) The appellate authority may at any stage call for any evidence it considers necessary for the
disposal of the appeal,
(6) On the date fixed under sub-rule (3) for the hearing of the appeal, the appellate authority shall
take such evidence as it may have called for or consider to be relevant.
18. Exhibition of standing orders
A copy of these orders in English and in Hindi shall be posted at
[* * *] on a notice board
maintained at or near the main entrance to the establishment and shall be kept in a legible

Industrial Disputes Act
Industry means any business, trade, undertaking, manufacture or calling of employers and
includes any calling, service, employment, handicraft or industrial occupation or avocation of

In Bangalore Water Supply & Sewerage Board v. Rajappa (1972 SCC 213 = 36 FLR 266 =
1978(2) SCR 213 = 1978(1) LLJ 349 = AIR 1978 SC 548 (SC 7 member bench 5 v 2 judgment),
a very wide interpretation to the term 'industry' was given. It was held that profit motive or a
desire to generate income is not necessary. Any systematic activity organized by cooperation
between employer and employees for the production and/or distribution of goods and services
calculated to satisfy human wants and wishes is industry.
Thus, many hospitals, educational institutions, universities, charitable institutions and welfare
organisations have got covered under the Act. Professions, clubs, cooperatives, research
institutes etc. are also covered.
Industry Dispute and Workman The definition of industrial dispute and workman is as
follows -

Industrial Dispute Industrial dispute means any dispute or difference between employers and
employers, or between employers and workmen, or between workmen and workmen, which is
connected with the employment or non-employment or the terms and conditions of employment
or with the conditions of labour, of any person. [section 2(k)]. - - Section 2A provides that
dismissal, discharge, retrenchment of even a single workman will be industrial dispute even if
no other workman or any union is a party to the dispute.
Workman Workman means any person (including apprentice) employed in any industry to do
any manual, clerical or supervisory work for hire or reward. It includes dismissed, discharged or
retrenched person also. However, it does not include (i) Armed Forces i.e. those subject to Air
Force Act, Army Act or Navy Act (ii) Police or employees of prison (iii) Employed in mainly


managerial or administrative capacity or (iv) person in supervisory capacity drawing wages
exceeding Rs 1,600 per month or functions are is mainly of managerial nature. [section 2(x)].

Adjudication of disputes The Act provides for Works Committee in factories employing 100
or more workers. [section 3]. The committee will consist of equal number of representatives of
employer and employees. Representatives of employees will be selected in consultation with
Registered Trade Union. The Works Committee will first try to settle disputes. If dispute is not
solved, it will be referred to Conciliation Officer. He is appointed by Government. [section 4].
The matter may also be referred to Board of Conciliation. [section 4]. He will try to arrive at
fair and amicable settlement acceptable to both parties. If he is unable to do so, he will send
report to appropriate Government. [section 12(4)]. The Government may then refer the industrial
dispute to Board of conciliation, Labour Court or Industrial Tribunal. [section 12(5)].
Employer and employees can voluntarily refer the matter to arbitration. [section 10A]. [This
provision is very rarely used by employer and workmen. Generally, they prefer the Court route].

If no settlement is arrived at, there is three tier system of adjudication Labour Court, Industrial
Tribunal and National Tribunal. The order made by them is award.
Award means an interim or final determination of any industrial dispute or of any question
relating thereto by any Labour Court, Industrial Tribunal or National Tribunal. It also includes
arbitration award. [section 2(b)]. - - The award is required to be published by State/Central
Government within 30 days. [section 17]. The award becomes effective 30 days after its
publication. [section 17A].

Labour Court Labour Courts are constituted by State Governments u/s 7. It will be presided
over by Presiding Officer. The Labour Court has powers in respect of * Interpretation of
Standing Orders * Violation of Standing Orders * Discharge or dismissal of a workman *
Withdrawal of any customary concession or privilege * Illegality or otherwise of a strike or lock-
out * Other matters which are not under Industrial Tribunal. [Second Schedule to the Act]

Industrial tribunal Industrial Tribunal is constituted by State Government u/s 7A. The tribunal
will be presided over by Presiding Officer. The Industrial Tribunal has powers in respect of *
Wages, including period and mode of payment * Compensatory and other allowances * Hours of
work and rest intervals * Leave with wages and holidays * Bonus, profit sharing, provident fund
and gratuity * Shift working changes * Classification by grades * Rules of discipline *
Ratinlanisation and retrenchment of workmen. [Third Schedule to Act].
National Tribunal National Tribunal is formed by Central Government for adjudication of
industrial disputes of national importance or where industrial establishments situated in more
than one States are involved. [section 7B].

Reference of dispute Appropriate Government can refer any dispute to Board of Conciliation,
Court of Enquiry, Labour Court or Industrial Tribunal. [section 10(1)]. - - Appropriate
Government means * Central Government in case of railways, docks, IFCI, ESIC, LIC, ONGC,
UTI, Airport Authority, industry carried on by or under authority of Central Government * State
Government in case of other industrial disputes [section 2(a)].
Court/Tribunal can reduce punishment and order reinstatement - As per section 11A, the Labour
Court and Tribunal have wide powers. They can reappraise evidence. They can also see whether


the punishment is disproportionate to the gravity of the misconduct proved. If the Court or
Tribunal is of the view that the punishment is disproportionate, it can impose lesser punishment
or even set aside the termination and order reinstatement. - - If Court orders reinstatement and
employer files appeal in Higher Court, the employer is required to pay full wages to the
employee during the period of pendency of proceedings with High Court or Supreme Court.
However, if the workman was gainfully employed elsewhere, Court can order that payment of
such wages is not to be made. [section 17B].
Settlement - Settlement means a settlement arrived at in the course of conciliation proceedings.
It includes a written agreement between employer and workmen arrived at otherwise than in
course of conciliation proceedings (i.e. outside the conciliation proceedings). - - The difference is
that settlement arrived at in course of conciliation or an arbitration award or award of labour
court or Tribunal binds all parties to industrial dispute including present and future workmen and
all parties who were summoned to appear in the proceedings. [section 18(3)]. If settlement is
arrived at by mutual agreement, it binds only those who were actually party to agreement.
[section 18(1)]. - - The settlement is binding during the period it is in force. Even after that
period is over, it continues to be binding, unless a 2 month notice of termination is given by one
party to another. [section 19(2]. - - If no period has been specified, settlement is valid for 6
months and an award is valid for one year.
Jurisdiction of civil court qua industrial dispute Termination of a workman constitutes an
Industrial Dispute. Relief sought can be given by forum under Industrial Disputes Act and hence,
jurisdiction of civil court is impliedly barred. Chandrakant Tukaram Nikam v. Municipal
Corporation 2002 AIR SCW 710 = 2002(2) SCALE 77 = 2002 LLR 498 = 100 FJR 519 (SC 3
member bench).

Lay off, retrenchment and closure Lay off means failure, refusal or inability of employer on
account of shortage of coal, power or raw materials or accumulation of stock or break down of
machinery or natural calamity; to give employment to a workman on muster roll. - - Lay off
means not giving employment within two hours after reporting to work. - - Lay off can be for
half day also. In such case, worker can be asked to come in second half of the shift. [section

A factory employing 50 or more but less than 100 employees on an average per working day can
lay off the workmen, who have completed one year of service, by paying compensation equal to
50% of salary (basic plus DA) (section 25C of IDA). - - Employer can offer him alternate
employment, if the alternate employment does not call for any special skill or previous
experience, and lay off compensation will not be payable if employee refuses to accept the
alternate employment (section 25E).

Above provisions of compensation for lay off do not apply to (a) Industrial establishments
employing less than 50 workmen (b) seasonal industry (c) Establishments employing 100 or
more workmen, as in their case, prior approval of Appropriate Government is necessary u/s

Retrenchment Retrenchment means termination by the employer of service of a workman for
any reason, other than as a punishment inflicted by a disciplinary action. However,


retrenchment does not include voluntary retirement or retirement on reaching age of
superannuation or termination on account of non-renewal of contract or termination on account
of continued ill-health of a workman. [section 2(oo)].

Retrenchment means discharge of surplus labour or staff by employer. It is not by way of
punishment. The retrenchment should be on basis of last in first out basis in respect of each
category, i.e. junior-most employee in the category (where there is excess) should be retrenched
first. [section 25G]. If employer wants to re-employer persons, first preference should be given
to retrenched workmen. [section 25H].

A worker who has completed one year of service can be retrenched by giving one month notice
(or paying one months salary) plus retrenchment compensation, at the time of retirement, @ 15
days average wages for every completed year of service (section 25F).

In Parrys Employees Union v. Third Industrial Tribunal 2001 LLR 462 (Cal HC), it was held
that for purposes of retrenchment compensation under ID Act, the monthly salary should be
divided by 30. [Under Gratuity Act, it has to be divided by 26].

If number of workmen are 100 or more, prior permission of Appropriate Government is
necessary u/s 25N(1)].

Meaning of continuous service Provisions of compensation for lay off and retrenchment are
applicable only to workman who is in continuous service for one year. As per section 25B,
continuous service includes service interrupted by sickness, authorised leave, accident or strike
which is not illegal, or lock-out or cessation of work which is not due to fault of workman. -- In
Workmen v. Management of American Express AIR 1986 SC 548 = 1985(4) SCC 71, it was
held that actually worked cannot mean only those days where workman worked with hammer,
sickle or pen, but must necessarily comprehend all those days during which he was in the
employment of employer and for which has been paid wages either under express of implied
contract of service or by compulsion of statute, standing orders etc.

Closure Closure means permanent closing down of a place of employment or part thereof.
[section 2(cc)]. - - Thus, closure can be of part of establishment also. - - 60 days notice should be
given for closure to Government, if number of persons employed are 50 or more. 60 days notice
is not necessary if number of persons employed are less than 50. [section 25FFA]. Compensation
has to be given as if the workman is retrenched. [section 25FFF(1)]. - - If number of workmen
employed are 100 or more, prior permission of Government is necessary for closure u/s 25-O.

Provisions for large industries for lay off and closure - Large industries employing 100 or more
workmen on an average for preceding 12 months cannot lay-off, retrench or close down the
undertaking without permission from Government (sections 25M to 25-O of Industrial Disputes
Act). Invariably, such permission is almost never given, whatever may be the merits of the case.


Provisions of section 25M in respect of prior permission for lay off have been upheld in
Papnasan Labour Union v. Madura Coats AIR 1995 SC 2200. Provisions of section 25N were
upheld in Workmen v. Meenakshi Mills Ltd. - (1992) 62 Taxman 560 = 1992(1) SCALE 1248 =
1992 AIR SCW 1378 = (1992) 3 SCC 336 = JT 1992(3) SC 446 = 1992 LLR 481 = AIR 1994
SC 2696 (5 member bench). In this case, it was held that powers to give prior permission are
quasi-judicial and hence opportunity of hearing must be given and the order giving permission or
refusing permission is subject to judicial review. In Bharatia Electric Steel Co. Ltd. v. State of
Haryana 1998 LLR 322 (P&H HC DB), it was observed that operation of section 25-O should be
limited to cases where employer is acting arbitrarily or unfairly. If the reasons given by employer
for closure are genuine and adequate, permission cannot be refused.

In Orissa Textiles v. State of Orissa 2002 AIR SCW 333 = 2002 LLR 225 = 100 FJR 342 (SC 5
member Constitution Bench), it was held that order u/s 35-O should be in writing with reasons.
The order can be reviewed after one year, even for the same reasons.

If Banks refuse to give further loans to run the plant, the employer has to either abandon the
plant or devise some dubious ways to surmount the difficulties. One of the major reason why
foreign investors are reluctant to come to India in a big way is lack of exit policy. Some
industrial sickness and closures are inevitable in a market oriented economy. Absence of
official exit policy creates problems for honest employers (Dishonest employers devise their own

Notice of change in conditions of service Section 9A provides that an employer cannot effect
any change in the conditions of service applicable to any workman without giving 21 days
notice. Such notice is not required if there is settlement or award of Labour Court or Tribunal. As
per fourth schedule to the Act, such 21 day notice is required if there is going to be change in
wages, wage period, PF contribution, allowances, hours of work and rest intervals, shift timings,
new rules of discipline, increase or decrease in number of persons employed in any department
or shift.

Strike and lock-out Strike means a cessation of work by a body of persons employed in any
industry, acting in combination, or a concerted refusal, or a refusal under a common
understanding, of any number of persons who are or have been so employed to continue to work
or to accept employment. [section 2(q)].

As per section 23, workman should not go on strike in * during pendency of conciliation
proceedings and 7 days thereafter * during pendency of proceedings before Labour Court,
Industrial Tribunal or National Tribunal * During period of arbitration proceedings * During
period when settlement or award is in operation in respect of the matters covered by award or

Prohibition of strike and lock out in public utility service - .In case of public utility, employees
have to give at least 14 days notice for strike. The notice is valid only if strike commences within


6 weeks. Otherwise, fresh notice is required. - - Similarly, an employer cannot declare lock out
without giving 14 days notice. [section 22]. If such notice is received, Government authority
should be informed within five days. - - As per section 2(n), Public Utility Service includes
railways, major port and docks, section of industry on the working of which safety of
establishment depends, postal/telegraph/ telephone services, industry supplying power/ light/
water; system of public conservancy or sanitation. [section 2(n)]. In addition, Government can
declare industry specified in Schedule I as Public Utility Services. Such declaration can be
made for 6 months at a time [section 2(n)(vi)]. [Industries in first schedule include banking,
transport, cement, coal, defence establishments, security press, hospitals and dispensaries, oil
fields, mining of certain specified ores, foodstuff, cotton textiles, iron and steel etc].

Lock-out Lock-out means temporary closing or a place of employment or the suspension of
work, or the refusal by an employer to continue to employ any number of persons employed by
him. [section 2(l)]. - - Workers go on strike, while lock-out is to be declared by employer.

Wages during strike period - Wages during strike period are payable only if the strike is both
legal and justified - Syndicate Bank v. K Umesh Naik (1994) 5 SCC 572 = 1994 AIR SCW 4496
= 1994 II LLJ 836 = 1994 II LLN 1296 = (1994) 3 SCALE 565 = AIR 1995 SC 319 = 1994 II
CLR 753 = 1994 LLR 883 (SC constitution bench) - followed in HMT Ltd. v. HMT Head Office
Employees Assn 1997 AIR SCW 153 = AIR 1997 SC 585 = 1997 LLR 758. In HAL Employees
Union v. Presiding Officer 1996 LLR 673 (SC), it was held that when lockout by employer is
legal and justified, workmen are not entitled to payment of wages for the period during which the
lock-out continued.

No work no pay - Principle of No work no pay has been accepted by Supreme Court. - Bank of
India v. T S Kelawala 1989 LLR 277 (1990 LLR 313 ?) = 1990(SUP) SCALE 140(2) = (1990) 4
SCC 744 (SC) * Syndicate Bank v. K Umesh Naik (1994) 5 SCC 572 = 1994 AIR SCW 4496 =
1994 II LLJ 836 = 1994 II LLN 1296 = AIR 1995 SC 319 = 1994(3) SCALE 565 = 1994 II CLR
753 = 1994 LLR 883 (SC constitution bench). The principle of no work no pay is also
applicable when a man was eligible for promotion but was not promoted and in fact did not work
in the higher post. In such case, he is not eligible to get pay for higher scale - Paluru
Ramkrishnaiah v. UOI - (1989) 2 SCR 92 - followed in State of Haryana v. OP Gupta - 1996(1)
SCALE 602.

Illegal strike or lock-out Strike or lock out in violation of sections 22 or 23 and when it is
continuing in violation of order issued by Government u/s 10(3) (when matter is referred to
Conciliation Board or Tribunal) is illegal. [section 24]. Fine upto Rs 50 per day to workman and
Rs 1,000 to employer can be imposed. In addition, he can be imprisoned upto one month.
[section 26].

Restrictions on employer pending proceedings If any conciliation proceedings or proceedings
are pending before arbitrator, labour court or Industrial Tribunal, following restrictions are
applicable to employer.

No change in conditions of service in matters related to dispute Employer shall not make any


change in condition of service connected to dispute without permission of authority before whom
proceedings are pending. [section 33(1)(a)]. Change which is not related to dispute can be made
in accordance with standing orders without any permission. [section 33(2)(a)]

No removal of workman in matters related to dispute Employer shall not discharge, dismiss or
punish any workman in matter for any misconduct concerned to dispute, without permission of
authority before whom proceedings are pending. [section 33(1)(b)]. Punishment which is not
connected to dispute can be made in accordance with standing orders without any permission.
However, dismissal or discharge of workman will require approval of the action. Application for
approval should be made after action is taken. [section 33(2)(b)]. Prior permission is not
necessary. Application for approval is required to be submitted after action is already taken. - -In
Jaipur Zila Sahakari Bhoomi Vikas Bank v. Shri Ram Gopal 2002 AIR SCW 249 = 2002 LLR
237 (SC 5 member constitution bench), it was held that if the approval is not granted u/s 33(2)(b)
of Industrial Disputes Act, the order of dismissal becomes ineffective from the date it was passed
and employee becomes entitled to wages from date of dismissal to date of disapproval of

Protected workman - In every establishment, 1% of total workmen are recognised as Protected
workman u/s 33(3) (but minimum 5 and maximum 100). In case of such workmen, order for his
dismissal, discharge or punishment cannot be passed without permission of authority before
whom proceedings are pending, whether the issue is related to dispute or not. Such permission is
required only during the period proceedings are pending and not after main reference is decided.

Unfair Labour Practices Section 25T prohibits unfair labour practices by employer or workman
or a trade union. If any person commits unfair labour practice, he is punishable with fine upto Rs
1,000 and imprisonment upto 6 months. [section 25U]. Fifth schedule to Act gives list of what
are Unfair Labour Practices. Then major are as follows

In case of employer - * Interfering in Trade Union activities * Threatening workmen to refrain
them from trade union activities * Establish employer sponsored Trade Union * Discourage trade
union activities by various means * Discharge or dismiss by way of victimization or falsely
implicating workman * Abolish work of regular nature and to give that work to contractors *
Mala fide transfer of workman under guise of management policy * Employ badli or casuals and
continue them for years * Recruitment workmen during strike which is not illegal * Acts of force
and violence * Not implementing settlement or agreement or award * Refuse collective
bargaining * Continue illegal lock-out

In case of workmen and trade unions - * Support or instigate illegal strike * Coerce workmen to
join or not to join a particular trade union * Threatening or intimidating workmen who do not
join strike * Refuse collective bargaining in good faith * Coercive actions including go slow,
gherao, squatting on work premises after working hours etc. * Wilful damage to employers
property * Acts of force or violence or intimidation.

Industrial Employment (Standing Orders) Act

There are service conditions or service rules for various employees like Government


employees, bank employees, LIC employees etc. The Industrial Employment (Standing Orders)
Act, 1947 is designed to provide service rules to workmen.

The object of the Act is to require employers in industrial establishments to formally define
conditions of employment under them.

What are Standing Orders - Standing Orders means rules of conduct for workmen employed
in industrial establishments. Standing orders means rules relating to matters set out in the
schedule to the Act. [section 2(g)]. The schedule to the Act requires that following should be
specified in Standing Orders - (a) classification of workmen i.e. temporary, badli, casual,
permanent, skilled etc. (b) manner of intimating to workmen working hours, shift working,
transfers etc. (c) Holidays (d) Attendance and late coming rules (e) Leave rules (f) Leave
eligibility and leave conditions (g) Closing and reopening of sections of industrial establishment
(h) termination of employment, suspension, dismissal etc. for misconduct and acts or omissions
which constitute misconduct (i) Retirement age (j) Means of redressal of workmen against unfair
treatment or wrongful exactions by employer (k) Any other matter that may be prescribed.

Coverage of Act - The Act is applicable to all industrial establishments employing 100 or more
workmen. [section 1(3)].

Industrial establishment means (i) an industrial establishment as defined in section 2(i) of
Payment of Wages Act (ii) Factory as defined in section 2(m) of Factories Act (iii) Railway (iv)
Establishment of contractor who employs workmen for fulfilling contract with owner of an
industrial establishment. [section 2(e)].

The term industrial establishment includes factory, transport service, construction work, mines,
plantation, workshop, building activity, transmission of power etc.

Workman - Workman has meaning assigned to it under section 2(s) of Industrial Disputes Act.
[section 2(i)]. Thus, workman includes skilled, unskilled, manual or clerical work. However,
workman does not include employees engaged in managerial or administrative capacity or
supervisory capacity. Workman does not include workers subject to Army Act, Navy Act or
Air Force Act or to police or prison services.

Approval of Standing Orders - Every employer covered under the Act has to prepare Standing
Orders, covering the matters required in the Standing Orders. Five copies of these should be
sent to Certifying Officer for approval. [section 3(1)]. Certifying Officer means Labour
Commissioner and any officer appointed by Government to be Certifying Officer. [section

The Certifying Officer will inform the Union and workmen and hear their objections. After that,
he will certify the Standing Orders for the industrial establishment. [section 5]. Till standing
orders are certified, Model Standing Order prepared by Government will automatically apply.



Standing order should be displayed in English and local language on special notice boards at or
near entrance of the establishment. [section 9]. Modifications of Standing Order shall be done by
following similar procedure. [section 10].

Once the Standing Orders are certified, they supersede any term and condition of employment,
contained in the appointment letter. If there is inconsistency between Standing Order and
Appointment Letter, the provisions of Standing Order prevail - Eicher Goodearth Ltd. v. R K
Soni - (1993) XXIV LLR 524 = 1993 LLR 524 (Raj HC) * Printers House v. State of Haryana
1982 II LLN 327.

Standing orders are binding on employer and employee. These are statutorily imposed conditions
of service. However, they are not statutory provisions themselves (meaning that the Standing
Orders even when approved, do not become law in the sense in which Rules and Notifications
issued under delegated legislation become after they are published as prescribed.) - Rajasthan
SRTC v. Krishna Kant - AIR 1995 SC 1715 = (1995) 5 SCC 75 = 71 FLR 211 = 87 FJR 204 =
1995 AIR SCW 2683 = 1995 LLR 481 (SC).

Model Standing Orders - The Act has prescribed Model Standing Orders. These are
automatically applicable till employer prepares his own Standing Orders and these are
approved by Certifying Officer. [section 12A].

Disciplinary Action - The most important use of Standing Orders is in case of disciplinary
action. A workman can be punished only if the act committed by him is a misconduct as
defined under the Standing Orders. The Model Standing Orders contain such acts like
insubordination, disobedience, fraud, dishonesty, damage to employers property, taking bribe,
habitual absence or habitual late attendance, riotous behaviour, habitual neglect of work, strike in
contravention of rules etc. as misconducts. The Certified Standing Orders may cover other acts
as misconduct, if approved by Certifying Officer.

Subsistence Allowance Where a workman is suspended by employer pending investigation or
enquiry into complaints or charges of misconduct against him, the workman shall be paid
subsistence allowance equal to 50% of wages for first 90 days of suspension and 75% of wages
for remaining period till completion of disciplinary proceedings. [section 10A(1)]. - - Wages
has same meaning as under section 2(rr) of Industrial Disputes Act. [section 2(i)].
Statutory aspects of health, welfare and safety of employees
This Act may be called the Factories Act, 1948.
[(2) It extends to the whole of India
[* * *].
(3) It shall came into force on the lst day of April, 1949.


In this Act, unless there is anything repugnant in the subject or context,-
(a) "adult" means a person who has completed his eighteenth year of age;
(b) "adolescent" means a person who has completed his fifteenth year of age but has not
completed his eighteenth year;
[(bb) "calendar year" means the period of twelve months beginning with the first day of January
in any year;]
(c) "child" means a person who has not completed his fifteenth year of age;
[(ca) "competent person", in relation to any provision of this Act, means a person or an
institution recognized as such by the Chief Inspector for the purposes of carrying out tests,
examinations and inspections required to be done in a factory under the provisions of this Act
having regard to-
(i) the qualifications and experience of the person and facilities available at his disposal;
(ii) the qualifications and experience of the persons employed in such institution and
facilities available therein, with regard to the conduct of such tests, examinations and
inspections, and more than one person or institution can be recognized as a competent
person in relation to a factory;
(cb) "hazardous process" means any process or activity in relation to an industry specified in the
First Schedule where, unless special care is taken, raw materials used therein or the intermediate
or finished products, bye-products, wastes, or effluents thereof would-
(i) cause material impairment to the health of the persons engaged in or connected
therewith, or
(ii) result in the pollution of the general environment:
PROVIDED that the State Government may, by notification in the Official Gazette, amend the
First Schedule by way of addition, omission or variation of any industry, specified in the said
(d) "young person" means a person who is either a child or an adolescent;
(e) "day" means a period of twenty-four hours beginning at midnight;
(f) "week" means a period of seven days beginning at midnight on Saturday night or such other
night as may be approved in writing for a particular area by the Chief Inspector of Factories;


(g) "power" means electrical energy, or any other form of energy which is mechanically
transmitted and is not generated by human or animal agency;
(h) "prime mover" means any engine, motor or other appliance which generates or otherwise
provides power;
(i) "transmission machinery" means any shaft, wheel drum, pulley, system of pulleys, coupling,
clutch, driving belt or other appliance or device by which the motion of a prime mover is
transmitted to or received by any machinery or appliance;
(j) "machinery" includes prime movers, transmission machinery and all other appliances
whereby power is generated, transformed, transmitted or applied;
(k) "manufacturing process" means any process for-
(i) making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning,
breaking up, demolishing, or otherwise treating or adapting any article or substance with
a view to its use, sale, transport, delivery or disposal, or
[(ii) pumping oil, water, sewage or any other substance; or]
(iii) generating, transforming or transmitting power; or
[(iv) composing types for printing, printing by letter press, lithography, photogravure or
other similar process or book binding;]
(v) constructing, reconstructing, repairing, refitting, finishing or breaking up ships or
[(vi) preserving or storing any article in cold storage;]
(l) "worker" means a person
[employed, directly or by or through any agency (including a
contractor) with or without the knowledge of the principal employer, whether for remuneration
or not], in any manufacturing process, or in cleaning any part of the machinery or premises used
for a manufacturing process, or in any other kind of work incidental to, or connected with, the
manufacturing process, or the subject of the manufacturing process
[but does not include any
member of the armed forces of the Union];
(m) "factory" means any premises including the precincts thereof-
(i) whereon ten or more workers are working, or were working on any day of the
preceding twelve months, and in any part of which a manufacturing process is being
carried on with the aid of power, or is ordinarily so carried on, or


(ii) Whereon twenty or more workers are working, or were working on any day of the
preceding twelve months, and in any part of which a manufacturing process is being
carried on without the aid of power, or is ordinarily so carried on,-
but does not include a mine subject to the operation of
[the Mines Act, 1952 (35 of 1952)] or

[a mobile unit belonging to the armed forces of the Union, a railway running shed or a hotel,
restaurant or eating place].
[I ] :For computing the number of workers for the purposes of this clause all the
workers in
[different groups and relays] in a day shall be taken into account;]
[Explanation I I : For the purposes of this clause, the mere fact that an Electronic Data
Processing Unit or a Computer Unit is installed in any premises or part thereof, shall not be
construed to make it a factory if no manufacturing process is being carried on in such premises
or part thereof;]
(n) "occupier" of a factory means the person who has ultimate control over the affairs of the
(i) in the case of a firm or other association of individuals, any one of the individual partners or
members thereof shall be deemed to be the occupier;
(ii) in the case of a company, any one of the directors shall be deemed to be the occupier;
(iii) in the case of a factory owned or controlled by the Central Government or any State
Government, or any local authority, the person or persons appointed to manage the affairs of the
factory by the Central Government, the State Government or the local authority, as the case may
be, shall be deemed to be the occupier:]
[PROVIDED FURTHER that] in the case of a ship which is being repaired, or on which
maintenance work is being carried out, in a dry dock which is available for hire,-
(1) the owner of the dock shall be deemed to be the occupier for the purposes of any matter
provided for by or under
(a) section 6, section 7,
[section 7A, section 7B,] section 11 or section 12;
(b) section 17, in so far as it relates to the providing and maintenance of sufficient and
suitable lighting in or around the dock;
(c) section 18, section 19, section 42, section 46, section 47 or section 49, in relation to
the workers employed on such repair or maintenance;


(2) the owner of the ship or his agent or master or other office-in-charge of the ship or any
person who contracts with such owner, agent or master or other officer-in-charge to carry out the
repair or maintenance work shall be deemed to be the occupier for the purposes of any matter
provided for by or under section 13, section 14, section 16 or section 17 (save as otherwise
provided in this proviso) or Chapter IV (except section 27) or section 43, section 44, or section
45, Chapter VI, Chapter VII, Chapter VIII or Chapter IX or section 108, section 109 or section
110, in relation to-
(a) the workers employed directly by him, or by or through any agency; and
(b) the machinery, plant or premises in use for the purpose of carrying out such repair or
maintenance work by such owner, agent, master or other officer-in-charge or person;]
(p) "prescribed" means prescribed by rules made by the State Government under this Act;
[* * *]
(r) where work of the same kind is carried out by two or more sets of workers working during
different periods of the day, each of such sets is called a
["group" or "relay"] and each of such
periods is called a "shift".
Comment: Reading these provisions together, it is quite reasonable and legitimate to hold that a
person to be a worker within the meaning of the Factories Act must be a person employed in the
premises or the precincts of the factory. As held by this court in the State of Uttar Pradesh v. M.
P. Singh (1960) 2 SCR 605: (AIR 1960 SC 569) field workers who are employed in guiding,
supervising and controlling the growth and supply of sugar cane to be used in the factory are not
employed either in the precincts of the factory or in the premises of the factory. Hence the
provisions of the Factories Act do not apply to them. AIR 1978 SUPREME COURT 849, Rohtas
Industries Ltd v. Ramlakhan Singh
1. Cleanliness
(1) Every factory shall be kept clean and free from effluvia arising from any drain, privy or other
nuisance, and in particular-
(a) accumulation of dirt and refuse shall be removed daily by sweeping or by any other
effective method from the floors and benches of workrooms and from staircases and
passages, and disposed of in a suitable manner;
(b) the floor of every workroom shall be cleaned at least once in every week by washing,
using disinfectant, where necessary, or by some other effective method;


(c) Where a floor is liable to become wet in the course of any manufacturing process to
such extent as is capable of being drained, effective means of drainage shall be provided
and maintained;
(d) all inside walls and partitions, all ceilings or tops of rooms and all walls, sides and
tops of passages and staircases shall-
(i) where they are
[painted otherwise than with washable water-paint] or
varnished, be repainted or revarnished at least once in every period of five years;
[(ia) Where they are painted with washable water-paint, be repainted with at
least one coat of such paint at least once in every period of three years and washed
at least once in every period of six months;]
(ii) where they are painted or varnished or where they have smooth impervious
surfaces, be cleaned at least once in every period of fourteen months by such
method as may be prescribed;
(iii) in any other case, be kept whitewashed or colour washed, and the
whitewashing or colour washing shall be carried out at least once in every period
of fourteen months;
[(dd) all doors and window frames and other wooden or metallic framework and shutters
shall be kept painted or varnished and the painting or varnishing shall be carried out at
least once in every period of five years;]
(e) the dates on which the processes required by clause (d) are carried out shall be entered
in the prescribed register.
(2) If, in view of the nature of the operations carried on
[in a factory or class or description of
factories or any part of a factory or class or description of factories], it is not possible for the
occupier to comply with all or any of the provisions of sub-section (1), the State Government
may by order exempt such factory or class or description of factories
[or part] from any of the
provisions of that sub-section and specify alternative methods for keeping the factory in a clean
Disposal of wastes and effluents
[(1) Effective arrangements shall be made in every factory for the treatment of wastes and
effluents due to the manufacturing process carried on therein, so as to render them innocuous,
and for their disposal.]
(2) The State Government may make rules prescribing the arrangements to be made under sub-
section (1) or requiring that the arrangements made in accordance with sub-section (1) shall be
approved by such authority as may be prescribed.


. Ventilation and temperature
(1) Effective and suitable provision shall be made in every factory for securing and maintaining
in every workroom
(a) adequate ventilation by the circulation of fresh air, and
(b) such a temperature as will secure to workers therein reasonable conditions of comfort
and prevent injury to health;
and in particular,-
(i) walls and roofs shall be of such material and so designed that such temperature shall not be
exceeded but kept as low as practicable;
(ii) where the nature of the work carried on in the factory involves, or is likely to involve, the
production of excessively high temperatures, such adequate measures as are practicable shall be
taken to protect the workers there from, by separating the process which produces such
temperatures from the workroom, by insulating the hot parts or by other effective means.
(2) The State Government may prescribe a standard of adequate ventilation and reasonable
temperature for any factory or class or description of factories or parts thereof and direct that
[proper measuring instruments, at such places and in such position as may be specified, shall be
provided and such records, as may be prescribed, shall be maintained.]
[(3) If it appears to the Chief Inspector that excessively high temperatures in any factory can be
reduced by the adoption of suitable measures, he may, without prejudice to the rules made under
sub-section (2), serve on the occupier, an order in writing specifying the measures which, in his
opinion, should be adopted, and requiring them to be carried out before a specified date.]
Dust and fume
(1) In every factory in which, by reason of the manufacturing process carried on, there is given
off any dust or fume or other impurity of such a nature and to such an extent as is likely to be
injurious or offensive to the workers employed therein, or any dust in substantial quantities,
effective measures shall be taken to prevent its inhalation and accumulation in any workroom,
and if any exhaust appliance is necessary for this purpose, it shall be applied as near as possible
to the point of origin of the dust, fume or other impurity, and such point shall be enclosed so far
as possible.
(2) In any factory no stationary internal combustion engine shall be operated unless the exhaust
is conducted into the open air, and no other internal combustion engine shall be operated in any
room unless effective measures have been taken to prevent such accumulation of fumes there
from as are likely to be injurious to workers employed in the room.
Artificial humidification


(1) In respect of all factories in which the humidity of the air is artificially increased, the State
Government may make rules,-
(a) prescribing standards of humidification;
(b) regulating the methods used for artificially increasing the humidity of the air;
(c) directing prescribed tests for determining the humidity of the air to be correctly
carried out and recorded;
(d) prescribing methods to be adopted for securing adequate ventilation and cooling of
the air in the workrooms.
(2) In any factory in which the humidity of the air is artificially increased, the water used for the
purpose shall be taken from a public supply, or other source of drinking water, or shall be
effectively purified before it is so used.
(3) If it appears to an Inspector that the water used in a factory for increasing humidity which is
required to be effectively purified under sub-section (2) is not effectively purified he may serve
on the manager of the factory an order in writing, specifying the measures which in his opinion
would be adopted, and requiring them to be carried out before specified date.
(1) No room in any factory shall be overcrowded to an extent injurious to the health of the
workers employed therein.
(2) Without prejudice to the generality of sub-section (1), there shall be in every work room of a
factory in existence on the date of the commencement of this Act at least
[9.9 cubic meters] and
of a factory built after the commencement of this Act at least
[4.2 cubic meters] or space for
every worker employed therein, and for the purposes of this sub-section no account shall be
taken of any space which is more than
[4.2metres] above the level of the floor of the room.
(3) If the Chief Inspector by order in writing so requires, there shall be posted in each workroom
of a factory a notice specifying the maximum number of workers who may, in compliance with
the provisions of this section, be employed in the room.
(4) The Chief Inspector may, by order in writing exempt subject to such conditions, if any, as he
may think fit to impose, any workroom from the provisions of this section, if he is satisfied that
compliance therewith in respect of the room is unnecessary in the interest of the health of the
workers employed therein.
. Lighting
(1) In every part of a factory where workers are working or passing there shall be provided and
maintained sufficient and suitable lighting, natural or artificial, or both.


(2) In every factory all glazed windows and skylights used for the lighting of the workroom shall
be kept clean on both the inner and outer surfaces and so far as compliance with the provisions of
any rules made under sub-section (3) of section 13 will allow, free from obstruction.
(3) In every factory effective provision shall, so far as is practicable, be made for the prevention
(a) glare, either directly from a source of light or by reflection from a smooth or polished
(b) the formation of shadows to such an extent as to cause eye-strain or the risk of
accident to any worker.
(4) The State Government may prescribe standards of sufficient and suitable lighting for
factories or for any class or description of factories or for any manufacturing process.
Latrines and urinals
(1) In every factory-
(a) sufficient latrine and urinal accommodation of prescribed types shall be provided
conveniently situated and accessible to workers at all times while they are at the factory;
(b) separate enclosed accommodation shall be provided for male and female workers;
(c) such accommodation shall be adequately lighted and ventilated, and no latrine or
urinal shall, unless specially exempted in writing by the Chief Inspector, communicate
with any workroom except through an intervening open space or ventilated passage;
(d) all such accommodation shall be maintained in a clean and sanitary condition at all
(e) sweepers shall be employed whose primary duty it would be to keep clean latrines,
urinals and washing places.
(2) In every factory wherein more than two hundred and fifty workers are ordinarily employed-
(a) all latrine and urinal accommodation shall be of prescribed sanitary types;
(b) the floors and internal walls, up to a height of
[ninety centimeters], of the latrines
and urinals and the sanitary blocks shall be laid in glazed tiles or otherwise finished to
provide a smooth polished impervious surface;
(c) without prejudice to the provisions of clauses (d) and (e) of sub-section (1), the floors,
portions of the walls and blocks so laid or finished and the sanitary pans of latrines and


urinals shall be thoroughly washed and cleaned at least once in every seven days with
suitable detergents or disinfectants or with both.
(3) The State Government may prescribe the number of latrines and urinals to be provided in any
factory in proportion to the numbers of male and female workers ordinarily employed therein,
and provide for such further matters in respect of sanitation in factories, including the obligation
of workers in this regard, as it considers necessary in the interest of the health of the workers
employed therein.
(1) In every factory there shall be provided a sufficient number of spittoons in convenient places
and they shall be maintained in a clean and hygienic condition.
(2) The State Government may make rules prescribing the type and the number of spittoons to be
provided and their location in any factory and provide for such further matters relating to their
maintenance in a clean and hygienic condition.
(3) No person shall spit within the premises of a factory except in the Spittoons provided for the
purpose and a notice containing this provision and the penalty for its violation shall be
prominently displayed at suitable places in the premises.
(4) Whoever spits in contravention of sub-section (3) shall be punishable with fine not exceeding
five rupees.
21 Fencing of machinery
22. Work on or near machinery in motion
23. Employment of young persons on dangerous machines
24. Striking gear and devices for cutting off power

25. Self-acting machines

26. Casing of new machinery
27. Prohibition of employment of women and children near cotton-openers

(1) In every factory the following, namely:
(i) every moving part of a prime mover and every flywheel connected to a prime mover,
whether the prime mover or flywheel is in the engine house or not;
(ii) the headrace and tailrace of every water-wheel and water turbine;


(iii) any part of a stock-bar which projects beyond the head stock of a lathe; and
(iv) unless they are in such position or of such construction as to be safe to every person
employed in the factory as they would be if they were securely fenced, the following,
(a) every part of an electric generator, a motor or rotary convector;
(b) every part of transmission machinery; and
(c) every dangerous part of any other machinery;
shall be securely fenced by safeguards of substantial construction which
[shall be constantly
maintained and kept in position] while the parts of machinery they are fencing are in motion or
in use:
[PROVIDED that for the purpose of determining whether any part of machinery is in such
position or is of such construction as to be safe as aforesaid, account shall not be taken of any
occasion when-
(i) it is necessary to make an examination of any part of the machinery aforesaid while it is in
motion or, as a result of such examination, to carry out lubrication or other adjusting operation
while the machinery is in motion, being an examination or operation which it is necessary to be
carried out while that part of the machinery is in motion, or
(ii) in the case of any part of a transmission machinery used in such process as may be prescribed
(being a process of a continuous nature the carrying on of which shall be, or is likely to be,
substantially interfered with by the stoppage of that part of the machinery), it is necessary to
make an examination of such part of the machinery while it is in motion or, as a result of such
examination, to carry out any mounting or shipping of belts or lubrication or other adjusting
operation while the machinery is in motion, and such examination or operation is made or carried
out in accordance with the provisions of sub-section (1) of section 22.]
(2) The State Government may by rules prescribe such further precautions as it may consider
necessary in respect of any particular machinery or part thereof, or exempt, subject to such
condition as may be prescribed, for securing the safety of the workers, any particular machinery
or part thereof from the provisions of this section.
42. Washing facilities
(1) In every factory,-
(a) adequate and suitable facilities for washing shall be provided and maintained for the
use of the workers therein;


(b) separate and adequately screened facilities shall be provided for the use of male and
female workers;
(c) such facilities shall be conveniently accessible and shall be kept clean.
(2) The State Government may, in respect of any factory or class or description of factories or of
any manufacturing process, prescribe standards of adequate and suitable facilities for washing.
43. Facilities for storing and drying clothing
The State Government may, in respect of any factory or class or description of factories, make
rules requiring the provision therein of suitable places for keeping clothing not worn during
working hours and for the drying of wet clothing.
45. First-aid appliances
(1) There shall in every factory be provided and maintained so as to be readily accessible during
all working hours first-aid boxes or cupboards, equipped with the prescribed contents, and the
number of such boxes or cupboards to be provided and maintained shall not be less than one for
every one hundred and fifty workers ordinarily employed
[at any one time] in the factory.
[(2) Nothing except the prescribed contents shall be kept in a first-aid box or cupboard.
(3) Each first-aid box or cupboard shall be kept in the charge of a separate responsible person
[who holds a certificate in first-aid treatment recognized by the State Government] and who
shall always be readily available during the working hours of the factory].
[(4)] In every factory wherein more than five hundred workers are
[ordinarily employed]
there shall be provided and maintained an ambulance room of the prescribed size, containing the
prescribed equipment and in the charge of such medical and nursing staff as may be prescribed
[and those facilities shall always be made readily available during the working hours of the
(1) In every factory wherein more than
[thirty women workers] are ordinarily employed there
shall be provided and maintained a suitable room or rooms for the use of children under the age
of six years of such women.
(2) Such rooms shall provide adequate accommodation, shall be adequately lighted and
ventilated, shall be maintained in a clean and sanitary condition and shall be under the charge of
women trained in the care of children and infants.
(3) The State Government may make rules


(a) prescribing the location and the standards in respect of construction, accommodation,
furniture and other equipment of rooms to be provided under this section;
(b) requiring the provision in factories to which this section applies of additional facilities
for the care of children belonging to women workers, including suitable provision of
facilities for washing and changing their clothing;
(c) requiring the provision in any factory of free milk or refreshment or both for such
(d) requiring that facilities shall be given in any factory for the mothers of such children
to feed them at the necessary intervals.
49. Welfare officers
(1) In every factory wherein five hundred or more workers are ordinarily employed, the occupier
shall employ in the factory such number of welfare officers as may be prescribed.
(2) The State Government may prescribe the duties, qualifications and conditions of service of
officers employed under sub-section (1).



Module VIII

Career and succession planning

Meaning, significance and process of career planning
Career development is important for companies to create and sustain a continuous learning
environment. A study conducted by PWC of companies in finance, online services, hospitality,
real estate and high-tech industries suggests that companies that are successful at managing the
employee growth that accompanies business expansion and increased demand for their products
and services focus on recruitment, career development, culture orientation and communications.
These companies emphasize that employees are responsible for career management.

It is the process through which employees,
Become aware of their own interests, values, strengths and weakness.
Obtain information about their own interests, values, strengths and weakness.
Obtain information about job opportunities within the company.
Identify career goals.
Establish action plans to achieve career goals.
It is important for both the employees perspective and the companys perspective.
From the companys perspective, the failure to motivate employees to plan their careers can
result in a shortage of employees to fill open positions, in lower employee commitment, and
inappropriate use of monies allocated for training and development programs.
From the employees perspective, lack of career management can result in frustration, feelings of
not being valued in company, and being unable to find suitable employment or (should a job
change) be necessary due to mergers, acquisitions, restructuring or downsizing.

Careers refers to the individual sequence of attitudes and behavior associated with work-related
experiences and activities over the span of the persons life.
Career have been described as advancement.
Careers are a sequence of promotions or upward moves in a company during the persons work
Careers are also professions and this occurs only in occupations in which there is a clear pattern
of advancement.
Careers can also be considered as a lifelong sequence of jobs.
Careers are also lifelong sequence of role related experiences.

Career stages


Career development is the process by which employees progress through a series of stages, each
characterized by a different set of developmental tasks, activities and relationships. The four
career stages are: Exploration, Establishment, Maintenance and Disengagement. And each of
these stages is characterized by developmental tasks, activities and relationships. Employee
retention, motivation and performance are affected by how well the company addresses the
development tasks at each career stage.
a) Exploration Stage:
In this stage employees identify the type of work that interests them. Here they consider their
interests, values and work preferences and they seek information about their jobs, careers and
occupation from co-workers, friends and family members. Exploration occurs in the midteens to
early-to-late 20s.
b) Establishment Stage:
In this stage, individuals find their place in the company, make an independent contribution,
achieve more responsibility and financial success and establish a desirable lifestyle. Employees
in this stage liked to be viewed as contributors to the companys success. Employees who have
reached this stage are considered to be colleagues. Colleagues are employees who can work
independently and produce results.
c) Maintenance Stage:
In this stage, the individual is concerned with keeping skills up to date and being perceived by
others as someone who is still contributing to the company. Employees under this stage have
many years of job experience, much job knowledge and an in-depth understanding of how the
company expects business to be conducted. They also can be valuable trainers or mentors.
d) Disengagement Stage:
Refers to older employees electing to retire and concentrate entirely on nonwork activities such
as sports, hobbies, travelling or volunteer work.
In this stage individuals prepare for a change in the balance between work and non-work
activities. Employees take on the role of a sponsor. Sponsor provides direction to other
employees, represents the company to customers, initiates actions and make decisions.

Companies career management systems vary in the level of sophistication and the emphasis they
place on the different components of the process. Career management system includes Self-
assessment, reality check, goal setting and action planning.
a) Self-Assessment:
Refers to the use of information by employees to determine their career interests, values,
aptitudes and behavioral tendencies. It often involves psychological tests such as Strong-
Campbell Interest Inventory and Self-Directed Search. The former helps employees identify their
occupational and job interest; the latter identifies employees preferences for working in different
types of environments.
b) Reality Check:


Refers to the information employees receive about how the company evaluates their skills and
knowledge and where they fit into the companys plans (potential promotional opportunities,
lateral moves). This information is provided by the employees managers as part of the
performance appraisal process. Ex: In Coca-Cola USAs career planning system, employees and
managers have a separate meeting after the annual performance review to discuss the employees
career interests, strengths and possible developmental activities.
c) Goal Setting:
In goal setting employees develop short and long-term career objectives. These goals relate to
desired positions (to become sales manager within three years), level of skill application (using
budgeting skills to improve the cash flow system in the unit) or skill acquisition (to learn how to
use the companys human resource information system).
d) Action Planning:
Employees determine the ways to achieve their short-term and long-term career goals. It involves
enrolling in training courses and seminars, conducting informal interviews or applying for job
openings in the company.

Responsibility for career planning and career anchors Employees, managers, human resource
managers, and the company share the responsibility for career planning.
a) Employees Role:
The employees must approach their manager to initiate career-related discussion as part of the
personal development planning process. Regardless of how sophisticated the companys career
planning system is, employees should engage in career management actions.
Take the initiative to ask for feedback from managers and peers regarding their skill strengths
and weakness.
Identify their stage of career development and development needs.
Seek challenges by gaining exposure to a range of learning opportunities (sales assignments,
product design assignments, administrative assignments).
Interact with employees from different work groups inside and outside the company
(professional associations, task forces).
Create visibility through good performance.
b) Managers Role:
Regardless of the type of Career management system in the company, managers should play a
key role in career management process. Because managers are the primary source of information
about position openings, training courses and other developmental opportunities. To help
employees deal with career issues, managers need to be effective in four roles: Coach, appraiser,
advisor and referral agent.
Coach-Probe problems, interests, values, listen to the needs, define and clarify concerns.
Appraiser-Clarify company standards and job responsibilities and company needs and give
timely feedback.


Advisor-Generate options, experiences and relationships, assist in goal setting and provide
Referral Agent-Link to career management resources and follow up on career management plan.
c) Human Resource Managers Role:
HR managers should provide information or advice about training and development
opportunities. Also, HR managers should provide specialized services such as testing to
determine employees values, interests and skills, prepare employees for job searches and offer
counseling and career-related problems.
d) Companys Role:
Companies are responsible for providing employees with the resources needed to be successful
in career planning. These resources include specific programs as well as processes for career
Career workshops (seminars on how career management system works, self-assessment, goal
setting and helping managers understand and perform their roles in career management.
Infromation on career and job opportunities
Career planning workbooks (printed guides that direct employees through a series of exercises,
discussions and guidelines relating to career planning).
Career counseling (advice from a professionally trained counselor who specializes in working
with employees seeking assistance with career issues).
Career paths (planning job sequences and identifying skills needed for advancement within and
across job families, such as moving from technical jobs to management jobs).
The company also needs to monitor the career planning system to (ensure that managers and
employees are using the system as intended and evaluate whether the system is helping the
company meet its objectives,

Meaning, significance and process of succession planning

Succession management system needs to be evaluated to ensure that they are meeting the needs
of employees and the business. Several types of outcomes can be used to evaluate career
management systems. Firstly, the reactions of the customers (employees and managers) who use
career management system can be determined through surveys.
Ex: Employees who use planning and counseling can be asked to evaluate the informations
timelines, helpfulness and quality. Managers provide information regarding how the system
affected the time needed to fill open positions in their department as well as the quality of the job
candidates and the employees selected for the positions. Second, more objective information
related to the results of the career management system can be tracked, such as actual time to fill
open positions, employee use of the system (including contact with career counselors, use of
libraries or inquiries on job postings), or number of employees identified as ready for
management positions.


Evaluation of a career management system should be based on its objectives. If improving
employee morale is the systems goal, then attitudes should be measured. If the system
objectives are more concrete and measurable (as with a system designed to retain employees
with high potential for management), then appropriate data (turnover) rates should be collected.

A wide range of companies special challenges in career management, including emphasizing
work-life balance, socializing and orienting new employees, developing dual-career paths,
avoiding skill obsolescence, helping employees cope with job loss and preparing employees for
retirement. These are the issues considered as career challenges because they tend to be
challenges that employees and companies face at one point in time in employees careers
(retirement), throughout their careers (work-life balance), or at different points in their careers
(socialization and orientation to jobs). These challenges affect a companys ability to attract,
retain and motivate talented employees.

Continuity of leadership and its impact on business
A) Socialization and Orientation
Organizational socialization is the process by which new employees are transformed into
effective members of the company. The purpose of orientation is to prepare employees to
perform their jobs effectively, learn about the organization and establish work relationships. The
three phases of socialization process are anticipatory socialization, encounter and settling in.
a) Anticipatory Socialization:
It occurs before the individual joins the company. Through anticipatory socialization, employees
develop expectations about the company, job, working conditions and interpersonal
relationships. Through socialization employees learn the history, company goals, language,
politics, people and performance proficiency.
b) Encounter:
This phase occurs when the employee begins a new job. No matter how realistic the information
was that they were provided during interviews and site visits, individuals beginning new jobs
will experience shock and surprise. Employees need to become familiar with job tasks, receive
appropriate training, and understand company practices and procedures.
c) Settling In:
In this phase, employees begin to feel comfortable with their job demands and social
relationships. They start resolving work conflicts and conflicts between work and non-work
activities. Also, employees become interested in the companys evaluation of their performance
and in learning about potential career opportunities with the company.
Employees need to complete all three phases of the socialization process to fully contribute to
the company.
Socialization and Orientation Programs
It plays an important role in socializing employees. While the content of the orientation
programs is important, the process of orientation cannot be ignored. Effective orientation


programs include active involvement of the new employee. Social networks can be established
through the company orientation programs that provide new employees with opportunities to
meet other new employees as well as employees in different parts of the company. The content
of the orientation programs includes Company-Level Information, Departmental-Level
information and Miscellaneous Information. The characteristics of effective orientation programs
Employees should be allowed to ask questions.
Program should include information both on the technical and social aspects as well.
It is the responsibility of the new employees manager.
Formal informal interactions occur.
Employees should be provide with information on the companys products, services and
B) Dual-Career Paths
A career path is a sequence of job positions involving similar types of work and skills that
employees move through in the company.
Individual Contributor Career Path: Scientist-Research Scientist-Principal Research Scientist
Management Career Path: Assistant manager-Manager-Department Manager-Assistant director-
A dual career-path system enable employees to remain in a technical career path or move into a
management career path.
Characteristics of effective career paths:
Salary, status and incentives for technical employees compare favorably with those of
They are given opportunities to increase their total compensation through bonuses.
The career path is for employees with outstanding technical skills.
Individual contributors are given the opportunity to choose their career paths.
C) Plateauing
It means that the likelihood of the employee receiving future job assignments with increased
responsibility is low. Compares to employees in other career stages, midcareer employees are
most likely to plateau. Employees can plateau for several reasons, they are:
Discrimination based on age, gender, race.
Lack of ability
Lack of training
Low need for achievement
Unfair pay decisions or dissatisfaction with pay raises.
Confusion about job responsibilities
Slow company growth resulting in reduced development opportunities
Plateaued employees should be encouraged to become involved in developmental opportunities,
including training courses, job exchanges, and short-term assignments in which they can use
their expertise outside their departments. Possible remedies for Plateaued employees:


Employees should understand the reasons for plateauing
Employees should be encouraged to participate in developmental activities
Employees should seek career counselling
Employee should do a reality check on his or her solutions.
D) Skills Obsolescence
Obsolescence is a reduction in an employees competence resulting from a lack of knowledge of
new work process, techniques and technologies that have developed since the employee
completed his or her education. Avoiding obsolescence has been a concern of employees in
technical and professional occupations such as engineering and medicine. And importantly it has
to be avoided if companies are trying to become learning organizations. If empoyees become
obsolete both the employee and company suffer.
Obsolescence can be avoided by:
Providing employees with the opportunity to exchange information and ideas.
Giving employees challenging work assignments in their careers.
Providing job assignments that challenge employees and require them to stretch their
Providing rewards for updating behaviors (such as taking courses, suggestions and
customer service and product innovation).
Allowing employees to attend professional conferences, subscribe to professional
journals and magazines or enroll in university or community center courses at low or no
E) Coping With Career Breaks
Both men and women face major problems in trying to return to work after taking several
months or years off for family or other reasons. Peers are often asked to take over the work load
of the reservists, which can mean longer work hours, a larger work load, and more time at work
on weekends and evenings. These disruptions have a greater impact on smaller companies than
larger companies. Inorder to cope with these kinds of issues companies are providing small work
contracts that can be done at home. These contracts include proposal writing, idea development
and client contact.
F) Balancing Work And Life
Many companies believe that helping employees balance work and life benefits both the business
and employees personal lives. Work-life balance from the employees perspectives means trying
to manage work obligations as well as family and life responsibilities. From the companys
perspective, work-life balance is the challenge of creating supportive company culture where
employees can focus on their jobs while at work. A supportive work-life culture is a company
culture that acknowledges and respects family and life responsibilities and obligations and
encourages managers and employees to work together to meet personal and work needs.
Types of Work-Life Conflict:


Time-based conflict occurs when the demands of work and non-work interfere with each other.
Ex: Jobs that demand late evening office, overtime work, or out-of-town travel conflict with
family activities and team-sport schedules.
Strain-based conflict results from the stress of work and non-work roles. Ex: A new born child
deprives parents of sleep, as a result it is difficult for them to concentrate at work.
Behavior-based conflict occurs when employees behavior in work roles is not appropriate for
their behavior in non work roles. Ex: Managers work demands that they be logical, impartial and
authoritarian. At the same time, these managers are expected to be warm, emotional and friendly
in their relationships with their family members or friends.
G) Company Policies to Accommodate Work And Non Work
Companies have begun to respond to work and non work issues by developing policies designed
to reduce the potential of work-life conflict. These policies emphasize the communication of
realistic information about the demands of jobs and careers, flexibility in where and when work
is performed, job redesign and support services such as child care and elder care programs.
H) Coping with Job Loss
Coping with job loss is an important career development issue because of the increased use of
downsizing to deal with excess staff resulting from corporate restructuring, M&A and takeovers.
Job loss is especially traumatic for old workers. From a career and management standpoint,
companies and managers have two major responsibilities. First, they are responsible for helping
employees who will lose their jobs. Second, steps must be taken to ensure that the survivors of
the layoff remain productive and committed to the organization.
To prepare employees for layoffs and reduce the potential negative effects, companies need to
provide outplacement services. These services include:
Advance warning and explanation for layoff
Psychological, financial and career counseling
Assessment of skills and interests
Job campaign services such as resume-writing and interview training
Job banks and job leads information to be provided
Electronic delivery of job openings.
Guidelines for Termination Meetings with Employees
Planning (Alert outplacement that termination will occur).
Timing (Shouldnt occur on a Friday afternoon, very late on any day, or before a
Place (It should occur in the employees office).
Length (Meeting should be short and to the point).
Approach (provide straight forward explanation, stating reasons for termination).
Benefits (A written statement of salary continuation, benefits continuation, outplacement
support (office arrangements, counseling), and other terms and conditions should be
provided and discussed with the employee).
I) Dealing with Older Workers


a) Preretirement Socialization:
Is the process of helping employees prepare for exit from work. It encourages employees to learn
about retirement life, plan for adequate financial, housing and health care resources and plan
accurate expectations about retirement. Employees who attend preretirement socialization
programs have fewer financial and psychological problems and experience greater satisfaction
with retirement compared to employees who do not attend these programs.
b) Retirement:
It involves leaving a job and a work role and making a transition out of their current job and
company seeking full-or-part time employment elsewhere.
c) Early Retirement Programs:
Early retirement offers employees financial benefits to leave the company. These programs are
part of the companys strategy to reduce labor costs without having to lay off employees.
Financial benefits usually include a lump sum of money and a percentage of salary based on
years of service. Eligibility for early retirement is based on age and years of service.