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|| APPENDIX (CH-9)
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|| APPENDIX (CH-29)
Our approach to labour problems rests on considerations which are related on the one hand to the requirements of the well being of the working class and on the other to its vital contribution to the economic stability and progress of the country. The worker is the principal instrument in the fulfilment of the targets of the Plan and in the achievement of economic progress, generally. His cooperation will be an essential factor in creating an economic organisation in the country which will best subserve the needs of social justice. Certain rights and obligations are associated with this distinctive role.
2. Adequate provision has to be made for the basic needs of the workers in respect of food, clothing and shelter so as to enable them to remain in a state of health and efficiency. Besides the satisfaction of these basic needs, they should have their due share in social and economic progress in the shape of improved health services, wider provision of social security, better educational opportunities and increased recreational and cultural facilities. The workers must, of course, as members of the community have the full benefit of the social services and facilities available to any other section. Appropriate measures must, however, be taken to meet their peculiar difficulties and to remove their special handicaps.
3. The conditions of work should be such as to safeguard the worker's health and protect him against occupational hazards. The work-place should provide reasonable amenities for his essential needs. The worker should also be equipped with the necessary technical training and a certain level of general education. Having placed his assetslabour and skill at the disposal of the community, he should be assured of a reasonable measure of security against the various natural and other risks to which he is exposed. In his relations with the management, it is necessary that he should be treated with consideration. When he feels he cannot get a fair deal from his employer, he should have access to an impartial machinery set up for the purpose. The worker must be free to organize and to take lawful action in furtherance of his rights and interests. The community has recognised most of these rights, which have found a place in the Constitution.
4. The Central and State Governments have been alive to all these needs of workers. Some of the laws pertaining to factories, trade unions, workers' compensation for injuries and death have been in existence for a long time, but the pace of action has quickened since Independence. The Ministry of Labour at the Centre, in particular, have made strenuous efforts to promote the well-being of the working class on the basis of a planned programme with legislative and administrative measures, much of which has been successfully carried out. In the sphere of labour legislation undertaken recently mention may be made of the Industrial Disputes Act, 1947, the Factories Act, the Coal Mines Provident Fund and Bonus Scheme Act, the Minimum Wages Act, the Employees' State Insurance Act of 1948, the Plantation Labour Act, 1951, ths Mines Act and the Provident Fund Act of 1952. Some of these Acts have already come into operation while others are being put in force. A number of welfare schemes particularly for employees of mines and of Central Government undertakings have been introduced by the Ministry. Housing for industrial workers has made a modest beginning. Effect is now being given to the recommendations of the Commission for participation by Government in this activity on a much larger scale. In addition to the funds allotted to housing and to resettlement schemes of landless agricultural workers over 6-74 crores of rupees* are intended to be spent on labour welfare during the period of the Plan, both by the Central and State Governments. Tripartite bodies have been set up to advise Government on various labour matters. Advisory Boards are working in many States. The employment position in factories has been much better during recent years as compared to the two years immediately after the end of the war. The average annual earnings of factory workers have shown a sceady increase. Trade unionism has experienced a remarkable growth during these years but the qualitative progress has not been even.
5. The response of the workers to these measures has been satisfactory. Noticeable increases in production have been recorded in a number of industries during last year and the first half of this year. Strike activity has considerably diminished. The number of man-days lost last year was the lowest among the years of the post-war period. There is increasing evidence of the relations of mutual dependence and the need for direct dealings on the part of the representatives of the workers and the employers. The emergence of the Joint Consultative Board as a- bi-partite structure on the initiative of the top representatives of the working class and industry is a welcome advance. The tendency to rely more and more on internal settlement was manifest during and strengthened by the proceedings of the 'Indian Labour Conference held recently.
6. Greater improvement in the economic condition oJworkers has, however, been impeded by a rising price level and failure of the industry to renovate and modernise plant and rationaliz management in many cases. In this context it is, however, to be realized that rate ofprogres has to be determined not only by the needs of the workers but also by the limitations of th country's resources. Too rapid changes or changes on a wide scale may result in financial administrative and other difficulties which endanger new reforms and retard further development. On the side of labour, there should be a keen realisation of the fact that in an undeveloped economy, it cannot build for itself and the community a better life except on th' firm foundations of a higher level of productivity to which it has itself to make a substantia contribution The role of labour in promoting better standards of living for the communir involves acceptance of greater regularity in attendance, disciplined behaviour and meticulous care in discharge of duties. To ensure this, much greater attention has to be paid to the spread of literacy and the healthy development of trade unions so that workers are not exposed to exploitation and can act with greater sense of responsibility.
7. Industrial relations, wages and social security, working conditions, employment and training and productivity are among the important aspects of the labour problem in respect of which the Commission proposes to make specific recommendations.
It is proposed to deal here with industrial relations both in the private and public sector. The role the trade unions and employers' organisations have to play in the implementation of the plan also requires to be specifically stated. The recommendations in this section have therefore, been grouped under the following heads : (A) Private sector, (B) Public sector, (C) Role of trade unions and employers' organisations in a planned economy.
A. PRIVATE SECTOR
8. Harmonious relations between capital and labour are essential for the realization of the targets of the Plan in the industrial sector. This would be assured to a large extent if it were possible for management and labour to come to an agreement regarding the principles which should govern industrial relations. To this end the Planning Commission worked out certain proposals in consultation with the Ministries of Labour and Commerce and Industry on the basis of which agreed conclusions have been reached in the Industries Development Committee composed of representative employers and leaders of the principal workers' organisations in the country. These agreed conclusions are reproduced below :
9. Peace in industry has a great significance as a force for world peace if we consider the wider implications of the question. The answer to class-antagonisms and world conflicts will arrive soon if we succeed in discovering a sound basis for human relations in industry. Economic progress is also bound up with industrial peace. Industrial relations are, therefore, not a matter between employers and employees alone, but a vital concern of the community which may be expressed in measures for the protection of its larger interests.
10. In a community organised for social justice and the good of all its members, there would be a constant reconciliation of the interests of all sections and no legitimate occasion for a group to interfere with production or disorganise the life of the community should arise. Even where the workers and employers are ranged in opposite camps, the essential oneness of their interests over a wide area of the mutual relation of the parties is evident. But there is doubtless also a very considerable ground over which conflicts" may arise. The employer usually possesses superior strength which may become a source of injustice and oppression unless he is imbued with a high sense of fairness and uses his advantage with scrupulous regard to the rights and interests of others. In an economy organised on the basis of competition, private monopoly or private profit, the workers' right to have recourse to peaceful direct action for the defence of their rights and the improvement of their conditions cannot be denied and should not be curtailed unduly. It is generally accepted, however, that in any emergency and in the case of services, essential to the safety and well-being of the community recourse to a strike or lock-out may be suspended or withheld on the condition that in all such cases provision is made for a just settlement of the parties' claims. Experience of many years has demonstrated that in the majority of labour struggles, owing to the ignorance 'and the mistakes of the workers and their organizational and bargaining weakness they have failed to gain their ends irrespective of the merits of the disputes. The community has, therefore, to intervene for redressing the balance in favour of the weaker party to assure just treatment for all concerned. Legal provisions relating to trade unions and industrial disputes have to be framed and interpreted in relation to these objectives. On occasions the workers too make an unreasonable use of their strength. Whatever may be the apparent outcome of a labour conflict, the resulting loss far outweighs any advantage secured by a party and in most cases all concerned stand to lose.
11. In normal times and in ordinary cases whether the right to strike or lock-out should be circumscribed is an open question. An economy organised for planned production and distribution, aiming at the realisation of social justice and the welfare of the masses can function effectively only in an atmosphere of industrial peace. India is moving in this direction. It is also at present passing through a period of economic and political emergency. Taking the period of the next few years, the regulation of industrial relations in the country has to be based on these two considerations and it is incumbent on the State to arm itself with legal powers to refer disputes for settlement by arbitration or adjudication, on failure of efforts to reach an agreement by other means. However, the endeavour of the State has all along to be to encourage mutual settlement, collective bargaining and voluntary arbitration to the utmost extent, and thereby to reduce to the minimum occasions for its intervention in industrial disputes and the exercise of the special powers. The restrictive aspects of any existing or future labour legislation must be judged in the light of these considerations.
12. The employer-employee relationship has to be conceived of as a partnership in a constructive endeavour to promote the satisfaction of the economic needs of the community in the best possible manner. The dignity of labour and the vital role of the worker in such a partnership must be recognised. In dealing with the worker it has not only to be borne in mind that his energy and skill are the most precious assets of the nation, but also that his personality is an object of care and respect and of equal significance and worth with that" of any other element in the community. It may be that the worker on account of handicaps of illiteracy and ignorance and lack of opportunities is not able to play as effective a role in the working of industry as he should. Industrial relations have to be so developed that the worker's fitness to understand and carry out his responsibility grows and he is equipped to take an increasing share in the working of industry. There should be the closest collaboration through consultative committees at all levels between employers and employees for the purpose of increasing production, improving quality, reducing costs and eliminating waste.
13. The worker's right of association, organisation and collective bargaining is to oe accepted without reservation as the fundamental basis of the mutual relationship. The attitude to trade unions should not be just a matter of toleration. They should be welcomed and helped to function as part and parcel of the industrial system.
14. If any differences arise between the parties, they should be examined and settled in a spirit of reasonable adjustment with an eye to the good of industry and the well being of the community. In the last resort differences may be resolved by impartial investigation and arbitration. The intervention of the State and imposed settlements may become necessary at times. The stress of the administration as well as, the efforts of parties should, however, be for avoidance of disputes and securing their internal settlement.
15. The machinery and procedure relating to compulsory arbitration and adjudication of disputes should be so designed as to secure the essence of a fair settlement based on the principles of natural and social justice with the minimum expenditure of time and money. To achieve the aforesaid aims, statutory provisions in this connection should be framed in accordance with the following principles ;
16. Industrial arbitration diners fundamentally from the ordinary administration ot justice. In the latter case the law of the land has pre-determined the rights and obligations of the parties and the courts have only to interpret and apply the provisions of the statutes. A wide element of discretion, however, rules the decisions of industrial tribunals, because there are no established criteria for settling the issues which arise before them. It is possible that case law on those points will grow in course of time, but in matters affecting large economic interests it would be a very unsatisfactory procedure to leave the ' norms ' and the guiding policy to be settled by such a process of trial and error. The resolution on Industrial Truce adopted at the Industries Conference in December 1947 visualises the establishment of a machinery for the determination of' norms ' and standards which may govern the mutual relations and dealings between the employers and employees and the settlement of industrial disputes. The most suitable machinery for the purpose can only be a tripartite body consisting of representatives of employers, employees and Gavernmsnt. It nuy be expected that agreements will be reached on many contentious matters, but where this is not possible the Government may, with such expert assistance and judicial advice as is needed, itself arrive at decisions. These agreements or decisions may, according to the nature of the case, be issued as directives binding on the courts or the tribunals, or embodied in legislation.
17. There is need for continuous education of employers and employees as well as the public with regard to their duties and mutual obligations. The conduct of the parties must be in keeping with the objectives of the Constitution and the declared social policies of the State. Enlightened and active public opinion capable of mobilising itself on the side of justice and fairplay should be counted upon as a much more potent force for the maintenance of healthy industrial relations than the coercive pavers of the State.
18. It should be realised that while the economic aspects are important we are basically dealing with a human, psychological and social problem. The key to industrial peace lies Ultimately in a transformed outlook on both the sides and it should be the business of leadership in the ranks of labour and employers as well as in Government to strive to work out a new relationship among the parties in accord with the spirit of true democracy. Where the State is itself the employer the relations between the management and the employees should be so ordered as to offer an ex;'u'iple of sustained mutual goodwill and fruitful collaboration.
AVOIDANCE OF DISPUTES
19. In order to avoid needless friction, and disputes between employers and workers, it is necessary to lay down in concrete and specific terms the duties and responsibilities of either side. A worker should know what is expected of him in the particular occupation or capacity in which he is employed. He should also know the privileges which are due to him, in relation to the performance of his duties. The standing orders, which are now obligatory in case of most industrial establishments, cover some of this ground, but there are other matters concerning the relations between the parties and the precise range of duties of operatives in which some guidance may usefully be provided. Each undertaking should, therefore, adopt a manual of instructions for different classes of operatives of th; type in vogue in some Government offices and commercial establishments. Such manuals should be prepared, and when necessary revised, by tripartite consultation.
20. Elected representatives of workers function as shop-stewards in some establishments at present. This agency should be developed and fully employed for redressal of grievances of workers in their individual and collective capacity.
21. An employer should in consultation with the workers lay down clearly the manner in which any worker or group of workers, individually or collectively through their representatives, may approach authorities at different levels in the plant in respect of various types of grievances. Such procedure should be as uniform as possible for different workers in the same industry at the same centre. Suitable records may be maintained for this purpose wherever necessary. It should be open to an individual worker or his representative in due course to approach the highest executive on the spot, in the last resort. By suitable means the workers should be kept in touch with the state of the industry and the affairs of the establishment in which they are employed. This applies particularly in matters which concern them directly. The workers should be apprised in advance, in all feasible cases, of any contemplated chants which may alter the status quo relating to their conditions and interests. The employees must similarly indicate their desire for any change in the existing conditions. The observance of such a procedure will prevent precipitate action which often leads to avoidable trouble. Direct action on either side in violation of this obligation should be punishable under the law.
22. The standing orders should embrace all matters of routine industrial administration and any diffreences between the parties regarding the terms of the standing orders should be resolved by arbitration. Model standing orders should be framed officially for the purposes of guidance and to operate till they are settled in accordance with the prescribed procedure. Arrangements should be made for registration of agreements at whatever stage they are concluded between the parties, with the explicit provision that any dispute regarding the interpretion of the terms of the agreement will be referred to arbitration.
23. Social contacts, not of a patronising character but as among members of an industrial family, should be promoted for all those associated with the working of the establishment at any level. The supervisory staff and the technicians have a special position of advantage for taking the intitative in establishing a spirit of brotherhood and cordial relations. The personnel officers on the staff, usually designated as labour or labour welfare officers, have a special responsibility for the avoidance of disputes and creating mutual goodwill and understanding. In a number of cases owing to wrong selection, lack of proper equipment or training and a wholly misconceived view of their role on the part of the employer, these officers have failed to render very useful service and have, on the other hand, accentuated distrust and ill-will between the parties. Remedial action in this matter in which the State may assist should be under taken by organisations of employers without delay. It will be found helpful if joint committees at various levels periodically review the developments in industry and working conditions and other matters of common interest.
24. The informal approach visualised so far may not succeed in disposing of all the differences which arise between the employer and the employees in an establishment. Questions also arise which affect the common interests of the workers engaged in an industry and which must properly be pursued on a collective basis. Efforts for the settlement of such disputes may be pursued in a coordinated manner either through a suitable machinery for joint deliberations or by collective bargaining between the representatives of organised labour and of the employer or a group of employers as the case may be.
25. Joint committeesWorks committees for the settlement of differences on the spot between the workers and the management is the key of the system of industrial relations'as conceived in this Plan. Joint committees should also be set up for a centre and for the industry as a whole to tackle questions of wider import. These committees will be the best vehicle for improving labour relations and promoting employer-employee collaboration in the interests of high production and greater well-being of the workers through the progress of industry. It will not suffice to provide for the creation of joint committees either on a voluntary or compulsory basis. When a new institution of such a high significance has to be developed, active steps must be taken to foster it and to create conditions conducive to its healthy growth.
26. The successful functioning of works committees rests a good deal on the initiative, sympathy and interest of the management. The supervisory staff should be encouraged to lend a helping hand. There should be periodic review of progress of works committees. The circumstances hampering the operation of a committee in any unit should be examined carefully and every effort should be made to remove the hindrances. The works committee is in no sense to be a rival of the trade union. Every effort should be made to secure the support and co-operation of the latter in the conduct of the works committees. The personnel of the works committees on the side of the workers should invariably be chosen by the trade union enjoying a representative character and having the backing of the majority of the workers in a unit. In all other cases the workers should themselves elect their representatives on the works committees. It should be open to a union official or a Government Labour Officer to assist in the proceedings of the committees at the invitation of either party.
27. The committees while being free to take up any matter coming within the range of industrial relations should, in order that they may grow in strength, have a list of specified functions. All questions relating to amenities, working conditions, matters of discipline, quality of materials etc., should be necessarily dealt with by these committees. A works committee cannot of course take any decision which may diverge from the terms of a collective agreement. and its decisions regarding matters lying within the scope of collective agreement should be subject to the ratification of the management and the organisation of labour possessing the bargaining rights for the purpose.
28. A works committee is ordinarily the culminating step in the grievances machinery designed to function within a unit and there may be a separate committee for the purpose of collaboration in dealing with matters specially relating to production. It may, in certain cases, be found more convenient to entrust the works committee with the functions of a production committee.
29. Collective bargaining can derive reality only from the organised strength of the workers and a genuine desire on the part of the employer to co-operate with their representatives in exploring every possibility of reaching a settlement. A legal framework may, however, be created to determine the appropriate bargaining agency and to fix the responsibility for the enforcement of collective agreements. For the success of collective bargaining, it is essential that there should be a single bargaining agent over as large an area of industry as possible and uniform conditions should be secured in at least all the establishments in one centre. Where no trade union has built up the requisite strength to obtain a representative character, the largest union should have the right to function in respect of all establishments in which it has a majority of the workers as its members. Separate unions for industrial establishments in the same industry in a local area are inimical to the growth of a strong and healthy trade union and their existence may be Justified only in very exceptional circumstances. Provision has to be made for the direct election of representatives of workers from among the employees when no trade union exists or is able to secure the right to represent them. While it is preferable to have a single industrial union covering all the occupations in an industry, latitude may be permitted for special categories of salaried employees to form their own unions if the majority of these employees are in favour of such a course. In the absence of all other agencies arrangement has to be made by the State for the appointment of officials to look after the interests of the workers in industrial disputes.
30. To the bargaining status of the parties would naturally be attached certain obligations, especially with regard to non-participation in illegal strikes and illegal lock-outs.
31. An elaborate procedure relating to the representation of employees and employers may not be easily applicable to small and less advanced industries and a simpler alternative should be available for such cases.
Conciliation and enquiry
32. The State has to step in with an offer of conciliation when the parties fail to reach an agreement and the dispute continues. Conciliation should be made available in all such disputes and must be resorted to except when there is a voluntary submission for arbitration or a direct approach to a tribunal or court is permitted or prescribed. The conciliation officer has an important role for which he should be adequately equipped and trained. For cases involving major issues ad hoc or standing conciliation boards may be appointed. The board should be composed of an independent chairman and persons in equal numbers to represent the interests of the parties. Panels of non-official conciliators may also be formed. Conciliation proceedings should be carried on in a completely informal atmosphere and concluded as quickly as possible within a fixed time limit. A court or a tribunal should not take cognizance of what transpires in conciliation proceedings.
33. It may be useful in certain cases to have recourse to an official enquiry for the purpose of avoiding disputes, eliciting information or educating public opinion regarding the merits of a dispute. A court or a commission of enquiry may be set up for this purpose.
34. Adequate machinery should be provided for arriving at impartial decisions regarding disputes which are found incapable of settlement by conciliation. It is necessary to empower labour courts to take cognisance and dispose of any complaints relating to working conditions, health, safety, welfare and kindred matters. Reference of disputes relating to such crucial questions as wages, hours, rationalisation schemes should, as far as possible, be left to be settled by conciliation or voluntary arbitration. The State may however, have to refer such disputes for compulsory arbitration in the absence of a voluntary submission. Employers and trade unions may be encouraged to bind themselves in advance to submit to arbitration every industrial dispute in which a settlement is not reached by conciliation and not to sanction or resort to a strike or lock-out as the case may be which is not legal and in respect of which all the legal methods for the settlement of an industrial dispute have not been exhausted. Such employers and unions should be in a position to make a direct approach to the machinery set up by statute for the purpose of compulsory arbitration. The most honourable and patriotic course for employers and employees would be to agree to submit any present or future dispute or classes of such disputes to arbitration of any person or board of their choice. The number of such agreements would be a good index of real progress in industrial relations in the country. The apparatus of arbitration must be adjusted to suit a variety of needs. For important industries separate wage boards would be found very helpful. Such wage boards may also be established at the centre to which issues affecting an industry in the country as a whole may be referred. A central tribunal should be set up to deal with disputes of national importance.
35. The cause of industrial peace has not been helped by the manner in which the legal machinery has functioned in several industrial disputes. There is a widespread feeling that excessive delays occur and the judgments in several cases lack balance and are incapable of meeting the true requirements of the situation. The remedial action already outlined here would go far. to set things right. A considerable factor in the length of proceedings will be eliminated if the party making a claim submits its complete case at the start, furnishing a copy to the opposite party simultaneously. Similarly when conciliation fails a statement signed by the parties offering to submit their differences to arbitration may straightaway operate as a submission, to obviate delay.
36. The work of the industrial and labour courts suffers in quality and speed of disposal because the necessary information is not readily available. In part the State can itself fill the gap by preparing in advance the factual and statistical material which, in the light of experience, is found to have a bearing on the various types of cases which come before the courts. The State should have the power to require any employer or employers generally to maintain and furnish data relating to plant, manufacture, industrial transactions and dealings which might be needed for the settlement of industrial disputes. The balance sheets of industrial concerns have often to be cited. They should be supplied to the authorities in a suitable standardised form as soon as they are ready. Provision for this may be made in the Companies' Act in which there should also be adequate safeguards to ensure that the balance sheets present the correct state of affairs of the company.
37. Legal sanctions may have to be employed for securing due observance of the awards and decisions of the tribunals. If direction and control of an establishment becomes necessary for this purpose they may be exercised under special legislation to be undertaken for the regulation of industries.
38. There is obvious justification for compulsory postponement of stoppages without notice of change and while collective bargaining, conciliation or arbitration is in progress. A strike or lock-out without due notice during the pendency of any proceedings or in violation of the terms of a settlement, agreement, award or order have of course to be banned and attended by suitable penalties and loss of privileges. An illegal change should be treated on the same footing.
B. PUBLIC SECTOR (INDUSTRIAL AND COMMERCIAL EMPLOYEES IN PUBLIC UNDERTRAKINGS)
39. In India, as elsewhere, more and more industrial undertakings are now being financed and managed by the State. The number of workers employed in such undertakings is sufficiently large and harmonious industrial relations therein are matters of vital importance to the success and efficient working of these undertakings.
40. Public undertakings differ in an important respect from private undertakings. The ' profit' motive and the exploitation of workers for private gain have no significance in the State-owned enterprises. The undertakings have no doubt to show the same, if not greater efficiency of working as private owned undertakings. They have also to show profits. But the nature of these profits is different. The profits which these undertakings make are not profits intended for any individual or group of individuals but are extra wealth for the whole country.
41. A worker in a public undertaking stands on a different footing from a worker in private undertakings. He has a duel role of master and servant; master as a citizen of the country and servant as a worker of the undertaking. It is therefore necessary that he should be made conscious that in serving the undertaking he is serving himself and that the better he works and the greater his efficiency the better he will serve and help himself. He must be made to feel that the responsibility for the success or failure is as much his as that of the management and that the undertaking belongs to the country as a whole including himself. He should take pride in his contribution to the success of the undertaking.
42. The workers' enthusiasm for the success of public undertakings can be aroused only when they know that justice and fairplay prevail in the undertakings and proper arrangements are made for redress of the grievances of the workers. The aim should be to have a co-operative and contented labour force. The ways by which this can be achieved while maintaining peace in the undertakings and increasing production are :
C. ROLE OF TRADE UNIONS AND EMPLOYERS' ASSOCIATIONS IN A PLANNED ECONOMY
43. The trade unions and the employers' associations can play a positive "and important role in the execution of plans as experience of other countries has shown. For the successful implementation of the plans in India, co-operation from trade unions and employers is absolutely essential. The important central organizations of workers and the employers' associations should be persuaded to treat the period of the execution of the Plan as a period of national emergency. Their close co-operation should be secured at different stages of the execution of the Plan. Some beginning has been made in the direction of such co-operation. The passing of the Industrial Truce Resolution in December 1947, whereby both the employers and workers agreed to refrain from the use of lock-outs, strikes and slow-down tactics, the establishment in 1948 of industrial committees for important industries on a tripartite basis, the setting up of works committees under the Industrial Disputes Act, the co-opting of labour representatives on the Development Committee where labour matters are discussed, the constitution of the Joint Consultative Board on a bipartite, basis and the recent establishment of the Central Industries Advisory Council on which employers and workers are represented along with other interests, are some of the instances of such co-operation. All these are steps in the right direction. The scope of such co-operation should be widened and the representatives of employers and trade unions should be associated at every step in the implementation of the Plan.
44. Co-operation from unions and employers can assume several forms, some of which have been mentioned below :
The All-India Organizations of Workers and of Employers can play an effective part by undertaking the task of presenting the plans to the affiliated unions and employers and discuss--ing them with their members. They should convey their views to the planning authority and to Government. The aim should be to create enthusiasm amongst workers and employers foi the Plan. The unions and the employers could thus contribute much to the achievement and overstepping of the targets of the Plan. Healthy emulation should be promoted among the workers for this purpose.
The need for maintaining peace in industry and for avoiding interruption of work during the period of implementation of the Plan is obvious. In the interest of national economy unions and employers should exercise the utmost restraint in this r spect.
The ou look of unions with regard to the question of wages should be attuned to the J-equirements of economic development, in keeping with considerations of social justice. It may otherwise happen that ihe increases are won by workers in those industries in which they are highly organised, while those which have a weal; or no organisation would be neglected. It would not b^ appropriate to ask for flat percentage increases to maintain the relative advantage of those placed in higher categories.
The trade unions have to assume increased responsibility for the success of the productive effort. The whole economic health of the country depends upon rapidly increasing the productivity of labour. Such increases will largely depend on improved conditions of work and improved method and machinery. It will also greatly depend upon the utmost participation by the mass of workers in speeding up and improving production and that improvement can best be effected through modern industrial trade union organisations. All this would depend upon the extent to which employers associate workers with the productive effort and make the workers feel :hat in increased production lies the good both of the employers and workers. The employers should consult' workers in respect of new machinery, methods of production and the way in which economies could be effected in the costs of production.
An important welfare activity to which the trade unions in foreign countries have devoted themselves to is the organisation of co-operative societies. The activities of most of the trade unions in India have been confined so far to getting the grievances of workers redressed and fighting for the rights of the workers. This might have been inevitable in the earlier stages of the development of trade unions in this country. Trade Unions should now devote more time to welfare and cultural activities especially the organisation and running of consumers' and credit societies. This will be an important activity for the benefit of the workers. The employers could help such activity by providing facilities such as, accommodation, clerk al help, loans to start such societies etc.
Trade unions and employers' representatives should be associated at the various evels at the level of the undertaking, at the level of industry and at the regional and national level. The workers should feel that they are playing an effective part in the implementation of the Plan and that on them depends the rise in their standard of living as well as that of the common man.
II. WAGES AND SOCIAL SECURITY
45. The worker today is not satisfied with merely the wage he receives. He expects o be protected against various types of natural and other risks arising out of employment. In addition to the principles of wage policy it is proposed to deal here wich social security and provision for the future of workers. This section has, therefore, been sub-divided into: (A) Wages and (B) Social security.
46. During the war and the post war period there had been a rapid rise in prices. The profits ofindustrieo have considerably increased. The organised section of labour has also been able to obtain substantial increases in wages. But if the inflationary pressure is to be checked, steps may be necessary to divert to saving the present expenditure on consumption and to increase production. With regard to the industrial sector, profits and wages may have to be subjected to some control by Government during the period of the implementation of the Plan. Action should therefore be taken on die following lines :
(a) The excess profits tax and certain restrictions on dividends during the war and for a short period after the war have helped to keep in check the distribution of large dividends. During the period of the implementation of the Plan also similar restrictions should be placed on the remuneration of management, distribution of profits and the issue of bonus shares. Such restrictions may have to give due consideration to :
(b) On the side of wages, any upward movement, at this juncture, will further jeopardise the economic stability of the country if it is reflected in costs of production and consequently raises the price of the product. For workers too, such gain? will prove illusory because in all likelihood they will soon be cancelled by a rise in the general price level, and in the long run the volume of employment may be adversely affected. Such an increase in wages should, therefore, be avoided. Workers can be expected to agree to such a course only if restrictions are also placed on the distribution of profits as outlined in (a) above. Any steps to restrict wage increases should, therefore, be preceded by similar restrictions on the distribution of profits. Subject to this wage increases should be granted under the following circumstances :
47. Certain broad principles which may help in the regulation of wages have emerged as a result of the labours of various Commissions and Committees appointed by the Central and State Governments. These have, for the most part, been embodied in the existing and proposed legislation on the subject. They still do not form an adequate practical basis for a uniform policy in determining wage rates and effecting wage adjustments. The tripartite machinery, visualised in the section on Industrial Relations, should evolve in as precise terms as practicable, the ' norms ' and standards, which should guide wage boards or tribunals in settling questions relating to wages, having regard to the claims of the various groups of workers inter se, of the other participants in industry and of the community as a whole. The course of action in this respect in the immediate future should be governed by the following considerations :
(a) All wage adjustments should conform to the broad principles of social policy and disparities of income have to be reduced to the utmost extent. The worker must obtain his due share in the national income.
(b) The claims of labour should be dealt with liberally in proportion to the distance which the wages of different categories of workers have to cover before attaining the living wage standard.
(c) The process of standardization of wages should be accelerated and extended to as large a field as possible. There should be a progressive narrowing down of disparities in the rates of remuneration of different classes of workers in the same unit, of workers engaged in similar occupations in different units of the same industry, of comparable occupations in different industries and in wages in the same industry at different centres. Differentials for various jobs should be maintained at the minimum levels justified by:
(d) A scientific assessment of the relative work-load in different occupations and industries should be taken up. In this connection pilot studies on payment by results which are proposed to be sponsored by the Ministry of Labour with the technical assistance from the I.L.O. are a step in the right direction.
(e) The payment ofdeamess allowance to compensate for the rise in the cost of living has been an important feature of the wage structure during the war and post-war period. Since the end o^the war there have been demands made on behalf of labour for merging a substantial portion of deamess allowance into basic wages as there was no likelihood of prices falling to the prei-war level. The Government of IndL recently appointed a Committee to recommend what percentage of dearness allowance given to Centn.1 Government servants should be treated as pay. The Committee, in its report submitted to Government, has come to the conclusion that in the foreseeable future the cost of living index is not likely to fall below the range 265-284, taking the pre-war index to be 100. On this basis, the Committee recommends that 50 per cqnt of the dearness allowance admissible to the Central Government servants drawing a basic pay upto Rs. 750 p.m. should be amalgamated with pay. We accept this recommendation and suggest that the recommendation made by the Committee should be extended to workers in the private sector also.
48. Full and effective implementation of the minimum wage legislation should be secured during this period. Depressed areas should receive prior attention. In view of the paucity of data and the administrative difficulties pointed out by various State Governments, a limited beginning should be made with regard to the fixation of minimum wages for agricultural workers and the scope should be extended further as experience is gained. Suggestions on this subject have been made earlier in the report.
49. A kind of profit sharing in the form of periodic bonuses usually awarded by industrial courts and tribunals exists today. No proper basis for the awards has been worked out. The subject is one requiring expert examination and a study of the general and technical aspects of the problem. Efforts should be made to find out suitable experts within the the country as also from countries like the U.S.A., Germany, the United Kingdom, Sweden, and organisations like the I.L.O. who should go into the question of wages, profits, terms and conditions of payment, etc., and make recommendations. Although the quantum of bonus to be paid would be determined by the formulae to be laid down, to prevent the diversion of resources into consumption payment in cash should be restricted, the balance to constitute the savings of workers. This course of action should be accepted on the basis that it does not prejudice the contentions of either party regarding the character of the bonus. This would of course have to accompany similar restrictions on consumption in respect of other sections of the community.
50. Permanent wage boards with a tripartite composition should be set up in each State and at the Centre to deal comprehensively with all aspects of the question of wages, to initiate necessary enquiries, collect data, review the situation from time to time and take decisions regarding wage adjustments suo motu or on reference from parties or from the Government:.
B. SOCIAL SECURITY
51. Article 32 of the Constitution says, " The State shall, within the limits of its economic capacity and development, make effective provision for securing the right to work, to education, and public assistance in case of unemployment, old age, sickness, disablement and other cases of undeserved want." While this is generally applicable to the population of the country as a who'-e, the industrial worker is more liable to disease and invalidity than the average citizen. The man-days lost on account of sickness and disability constitute a heavy drain not only on the slender resources of the industrial workers but also on the industrial output of the country. Lack of social security impedes increased production, leads to larger labour turn-over and prevents building up of a stable and efficient labour force.
52. In all advanced countries the worker is protected against various types of risks such as, sickness, unemployment, old age, employment injury, maternity, invalidity, etc. [n India also, some of the risks to which a worker is exposed have been covered by the Workmens' Compensation Act and the Maternity Benefit Acts of the various State Governments. The Employees State Insurance Act is a more comprehensive piece of legislation and it applies in the first instance to factories using power and employing 20 or more persons, and covers all employees who are in receipt of remuneration not exceeding Rs. 400 p.m. It insures risks of sickness, maternity, and employment [injury. In addition to the medical care to which an insured person is entitled, cash payments are given equal to about .lalfofthe average wages.
53. The scheme framed under the Employees' State Insurance Act has been introduced at present in Delhi and Kanpur and is expected to be implemented throughout the country by the middle of July 1954. The programme for the implementation of the scheme in other States prepared by the Labour Ministry should be adhered to and the State Governments, employers and workers should offer their fullest co-operation for the purpose. The scheme does not include at present the families of the insured persons. Both in its coverage and the amount of benefits provided the scheme may appear to be modest as compared with similar schemes in some of the advanced countries. In view of its novelty, administrative and other difficulties and the financial implications of the scheme, efforts should be directed during the period of the Plan only to the proper implementation of the scheme in its present form and to putting it on a sound and sure foundation.
54. Another measure which can provide for the future of the workers is the institution of provident funds. The Central Legislature has recently passed the Employees' Provident Fund Act, 1952. A scheme under that Act has also been published and its implementation is expected to take place shortly.
55. The Act at present applies to six major industries employing 50 or more persons Textiles, Iron and Steel, Cement, Engineering, Paper and Cigarettes. As soon as experience is gained and the scheme is placed on a sound basis, it should be extended in gradual stages to all the industries employing 50 or more persons during the period of the Plan. A programme for its extension should be drawn up.
III. WORKING CONDITIONS
56. In order to get the best out of a worker in the matter of production, working conditions require to be improved to a large extent. The Factories Act, 1948, the Indian Mines Act, the Plantation Labour Act, 1951, and the proposed Central legislation for regulating the conditions of work in shops, establishments and motor transport services, have this common object and are sufficient for the purpose. The emphasis in the next five years should, therefore, be on the administrative measures needed for the implementation of such legislation. So far as the workers employed in factories and plantations are concerned, action may be taken on the following lines :
57. The Factories Act, 1948, is a comprehensive measure, and should, to a great extent, help to improve working conditions inside factories. This will be possible only if the provisions in the Act are properly enforced. The Act contains detailed provisions for ensuring the safety, health and welfare of workers employed in factories. The provisions relating to medical supervision and occupational health, which had not hitherto received proper attention, have been strengthened, and notification of occupational disease has been made compulsory in order to focus attention on these aspects of the problem. Apart from these, the various provisions relating to welfare should contribute to the general well-being and conten ment of the workers. The effective implementation of the Act is, therefore, a matter of the utmost importance in efforts to improve working conditions and promote the general well-being of the worker, and for this purpose the following recommendations are made :
58. Plantations can be considered to be the largest single labour absorbing industry in the country. Conditions in the plantations remained unsatisfactory for a long time for a variety of reasons. This led to a number of studies undertaken by government agencies to assess the problems of plantation workers. As a result of these studies, steps have been taken from time to time to ameliorate the conditions of work of these workers. The most recent and far-reaching piece of legislation, modelled on the lines of the Factories Act, is the Plantation Labour Act, 1951. There are, however, certain other matters on which action is called for and the lines on which such action is necessary are indicated below :
IV. EMPLOYMENT AND TRAINING
59. Effective utilization of man-power, having regard to the requirements of both industry and workers, is a question of national importance. Production depends upon a steady flow of labour of requisite skill in required quantities. This entails the collection and dissemination of information regarding man-power resources, organization of an efficient employment service, correct appraisal of the different types of skill required and the provision of facilities for training of workers both co increase their efficiency and to make up deficiency in particular branches of technical personnel. Progress has been made in recent years in some of these directions. The main steps which should be taken to bring about an improvement in the present methods of recruitment, employment and training of personnel are :
60. Another difficulty in the way of increase in production and reduction in costs is that several industries are faced with labour surplus to their requirements. The problem of rationalisation has so far proved difficult of solution. Notwithstanding the imperative need to reduce costs by rationalising industrial processes, the working class has strongly resisted it because of the consequent displacement of labour. It is now possible to reconcile the conflict and facilitate the progress of rationalisation on the strength of the following safeguards :
61. Considerable attention has been focussed on the productivity of labour in recent years both in this country and abroad. Employers in India have complained that productivity per worker has been going down. Workers contest this allegation with equal vehemence. It is, therefore, necessary that scientific investigations regarding these claims should be undertaken. Such investigations pre-suppose the existence of trained personnel, reliable industrial and labour statistics and a scientific attitude on the part of organisations of employers and workers. None of these conditions exists in the country today and much preparatory work is needed. The first step is to evolve methods for carrying out productivity studies under Indian conditions before the share of the different factors in the causation of high or low levels of productivity can be allocated on the basis of such studies. It is therefore suggested that a team of productivity experts should be invited under che Technical Assistance Programme and that this team should be charged with the responsibility of training a sufficient number of officers from Government, industry and trade unions in developing methods of productivity. As a result of discussions between the Labour Ministry and the Planning Commission, and on a reques made by the Labour Ministry, the I.L.O. has formulated proposals for technical assistance in the field of systems of payment by results and productivity. The experts to be sent out by the I.L.O. would undertake studies in the textile and engineering industries. After making a preliminary selection of the undertakings in which the studies are to be carried out, tin. experts would undertake a thorough analysis of the existing organisation and methods of work, job classification and wage scale with a view to suggesting improvements designed to increase efficiency and productivity and to improve working conditions. Indian experts from Government, employers and trade unions would be associated in this work. A limited numbel of persons from establish' ments would also be trained b} the experts.
62. Closely allied with this subject is the training-within-industry programme. These T.W.I, methods enable supervisors to play a vital part in the operation of the industry. The scheme is intended to improve supervisory skill b} .hree separate programmes ; Job Instruction, to develop skill in instructing worker; in their particular operations ; Job Relations, to develop skill in the management of personnel, and Job Methods, to develop skill in improving working technique. The Ahmedabad Textile Industry's Research Association with the assi? -tance of the I.L.O.'s Asian Field office on Technical Training, has carried out some valuable experiments in one of the textile mills of Ahmedabad. The supervisors and the heads of the departments were trained in the technique of " Job Instruction " by the l.L.O. experts on training-within-industry. The results of the experiments have shown an increase in production from 7 per cent to 18 per cent in different sections of the Spinning Department and 11 per cent to 30 per cent in different sections of the Weaving Department.
63. Much of this valuable work will be lost after the departure of the experts unless permanent arrangements are made to carry it on afterwards. This should be part of the function of the Labour Ministry. Future action should be on the following lines :
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