Assignment 1

Collective Bargaining: Lost its Relevance

Evolution of collective bargaining in India and elsewhere with special emphasis

after economic reforms of 1991-92

Sakshi Sharda
20192341
Collective bargaining has been defined by the Supreme Court as “the technique
by which dispute as to conditions of employment is resolved amicably by
agreement rather than coercion” Collective bargaining is a process
of negotiation between employers and a group of employees aimed at
agreements to regulate working salaries, working conditions, benefits, and other
aspects of workers' compensation and rights for workers Michael J. Jucious has
defined collective bargaining as “a process by which employers, on the one
hand, and representatives of employees, on the other, attempt to arrive at
agreements covering the conditions under which employees will contribute and
be compensated for their services”. The interests of the employees are
commonly presented by representatives of a trade union to which the employees
belong. The collective agreements reached by these negotiations usually set out
wage scales, working hours, training, health and
safety, overtime, grievance mechanisms, and rights to participate in workplace
or company affairs

https://www.thecrimson.com/article/2018/9/26/grad-union-list-of-goals/

Thus, collective bargaining can simplify be defined as an agreement collectively

arrived at by the representatives of the employees and the employers. By
collective bargaining we mean the ‘good faith bargaining’. It means that
proposals are matched with counter proposals and that both parties make every
reasonable effort to arrive at an agreement’ It does not mean either party is
compelled to agree to a proposal. Nor does it require that either party make any
specific concessions.

The expression “collective bargaining”, was coined by Sydney and Beatrice.

This was widely accepted and used in the United States of America for settling
industrial disputes. Thus, the USA is considered as the motherland of collective
bargaining. Collective bargaining as a method of settling industrial disputes is
comparatively of recent origin in India. Though attention was paid to, adopt
collective bargaining as a method to resolve industrial disputes since, the dawn
of planning era in India, it received increasing emphasis since the days of the
National Commission of Labour.
The collective bargaining in India remained limited in its scope and restricted in
its coverage by a well-defined legal structure. To understand this, let’s discuss
about the labour legislations in India and their scope and coverage.
The growth and development of the process of collective bargaining has
progressed along with the four phases of trade union development-
i. First phase (1950s-60s)—period of substitution.
ii. Second phase (mid 1960s—79)—period of economic stagnation and political
instability.
iii. Third phase (1980-91)—period of uneven economic development.
iv. Fourth phase (1991 onwards)—post-economic reforms and structural
adjustment.
India is a founder member of the International Labour Organization. So far
India has ratified 47 Conventions of the ILO, and influence of ILO Conventions
as a standard of reference for labour legislation and practices in India, and
not as a legally binding norm, has been significant. Even where India may not
be in a position to ratify a Convention, it has generally voted in favour of the
Conventions reserving its position as far as its future ratification is concerned.
However, with the recent dilution or suspension of Labour Laws in several
Indian states such as Uttar Pradesh, Madhya Pradesh, Gujarat, Punjab,
Maharashtra, Goa, Odisha and Rajasthan, in the backdrop of COVID-
19 found to be the blatant violation of International Labour Standards codified
by ILO. The specific International Labour Standards that are violated in the
process of dilution or suspension of Labour Laws by different states are Core
Convention of ILO (Eight hour working day), Right to Freedom of Association
(ILO Convention 87), Right to collective bargaining(ILO Convention 98)
and Tripartite Consultation Convention 1976(ILO Convention 144). India have
not ratified ILO Convention 87 and 98 till date.
 The four strategic objectives of the ILO decent work programme have
remained constant since they were launched in the 1998 ILO Declaration on
Fundamental Principles and Rights at Work:
 Rights at work, grounded in fundamental principles of work and
international labour standards
 Employment and income opportunities
 Social protection and social security
 Social dialogue and tripartism (ILO 1998).
India probably has the most comprehensive legal structure for labour welfare
and protection in the world. But the 92 percent of India’s workers who are in
informal employment do not form part of this. As the Indian government's
National Commission for Enterprises in the Unorganised Sector (NCEUS)
concluded, informal workers do not enjoy comprehensive protection of
minimum conditions of work. Most labour market laws only relate to formal
sector companies, as establishments employing below a certain number of
workers are exempt from them. Few of them are:
o The Factories Act, 1948 provides for the health, safety, welfare and other
aspects of workers while at work in the factories. Under this Act, an
establishment where the manufacturing process is carried on with the help
of power and employs 10 workers or an establishment where the
manufacturing process runs without power and employs 20 workers is
considered to be a factory. However, the following provisions of the Act
are not applicable to all factories.
o Employees Provident and Miscellaneous Provisions Act, Maternity
Benefit Act and Payment of Gratuity Act apply to all establishments with
10 or more workers. Though Employees State Insurance Act applies to
only those establishments with 20 or more workers. Minimum Wages
Act applies to all establishments and all workers, but the Payment of
Wages Act applies only to those establishments with 10 or more workers,
and also only to those workers getting wages less than Rs 1600 per
month. On the other hand, the Payment of Bonus Act is applicable to only
those enterprises employing 20 or more workers and only to those
workers getting wages less than Rs 3500 per month.
 o Industrial Disputes Act, 1947 lays down the procedures for the settlement
of industrial disputes. Its procedural aspects are applicable to all
enterprises for the settlement of industrial disputes.
o Industrial Employment (Standing Orders) Act makes it compulsory to
have Standing Orders in each enterprise to describe misconducts and
other service conditions, and also entails that for any misconduct no
worker will be punished without due process of law using the principles
of natural justice. But this law does not apply to those enterprises
employing less than 100 workers. Trade Union Act applies to all
establishments with 7 or more workers, since a minimum of 7 members
are necessary in order to register a trade union.

In fact, the Ministry of Labour and Employment states categorically that the
first objective of the Ministry is to achieve employment for any potential worker
and only afterwards is it appropriate to consider the quality of work - it is even
stated that decent work will follow automatically after employment has been
achieved. The ILO would agree that employment creation is an important part
of the decent work programme but it is a core aspect of the programme that
employment creation cannot be separated from the need to create decent work.
Opposed to this, it appears that for the foreseeable future Goal wants to keep
conditions of work in the informal economy as unregulated as they are today.
This extreme rejection of the need to improve conditions of work, except at
some point in the future, is opposed even by organizations such as the IMF
(IMF 2010), and is also in direct contradiction to the objectives of the ILO-India
Decent Work Country Programme. COVID-19 Pandemic has changed the
scenario to some extent.
In a country like ours serious obstacles to the development of collective
bargaining still exist in various areas. This problem occurs in particular in the
informal sector of almost all developing countries. The basic agrarian character
of the country, weak organisations of workers, unorganised bulk of workers in
agriculture and construction and contract employment and similar industries and
employments, the staggering unemployment, the level of rural and urban
poverty, the stage of trade unionism in the developing countries, the attitude of
management, too much of dependence on bureaucracy by the Governments,
reliance on compulsory adjudication method, all these have come in the way of
collective bargaining proper. Absence of industrial democracy leads to
industrial strife. Only collective bargaining through responsible trade unionism
can provide industrial democracy. It, therefore, Presupposes collective strength
duly recognised. It is the foundation upon which industrial peace can, and must
be built. History bears this out. Collective bargaining therefore, should be a
process of growth fostered from the bottom as well as from the above, aided by
the law to the extent possible and promoted through a spirit of understanding by
the government, the employers and the unions.