Industrial unrest

• Labor is one of the major production factors without labor there is no production.

• Industrial unrest or labor unrest is organization of strike actions undertaken by labor unions, where the workforce
become violent and obstructs the normal process of business and generate unrest.

• Labor unrest occurs when employees believe that they are treated unfairly by the management.

• As a result employees organize and strike upon the company, this is to show their dissatisfaction and raise their
demands towards the company.

Causes of labor unrest

• Wage Related Issues:

The wage levels in different industries vary tremendously. The disparity in wages between skilled and unskilled labour is
large even within an enterprise. This is true in both the organised and the unorganised sectors. The demand for higher bonus
has been a major cause for industrial disputes.

• Lack of Welfare and Social Security:

Social security measures can be divided into two categories (i) social insurance and (ii) social assistance. Social insurance
schemes are generally financed by the employees, employers and the State. However, such welfare measures face the
following problems: (a) insufficient coverage, (b) lack of employment insurance, (c) inherent bottlenecks of an exit policy, (d)
overlapping schemes, and (e) lack of facilities vis-a-vis requirement of beneficiaries.

• Improved Working Conditions:

Demand for lesser working hours, better-safety measures, holidays, leave etc., provoke trade unions to fight against
employers.

• Wave of Globalisation:

The new policy of liberalisation has opened up the avenue of foreign investment in India resulting in an intense competition
in the economy. The entrepreneurs are often forced to squeeze wages and push productivity for survival in today’s market-
driven economy.

• New Lifestyles:

The workers are increasingly adopting new urban lifestyles and this is expensive and requires a larger income for the family.
The workers are often drawn into industrial battle by such compulsions.

• Low-cost Production Alternatives:

The employers often defeat the purpose of trade unions by searching out low-cost production alternatives in the form of
small-scale subsidiary units in smaller towns where low wages will do.

• Rising Wages and Low Productivity:

• The big companies often close down their units because labour productivity often fails to keep pace with inflated
wages. Such moves taken often invite industrial tension