INDUSTRIAL JURISPRUDENCE

During the twentieth century a new branch of jurisprudence known as Industrial

Jurisprudence has developed in our country. Industrial jurisprudence, is a development of
mainly post-independence period although its birth may be traced back to the industrial
revolution. Before independence it existed in a rudimentary form in our country.

The growth of industrial jurisprudence can significantly be noticed not only from increase in
labour and industrial legislations but also from a large number of industrial law matters
decided by the Supreme Court and High Courts. It affects directly a considerable population
of our country consisting of industrialists, workmen and their families. Those who are
affected indirectly constitute a still larger bulk of the country's population.

This branch of law modified the traditional law relating to master and servant and had cut
down the old theory of laissez faire based upon the 'freedom of contract in the larger interest
of the society because that theory was found wanting for the development of harmonious and
amicable relations between the employers and employees. Individual contracts have been in
many respects substituted by a standard form of statutory contract through legislation and
judicial interpretation.

The traditional right of an employer to hire and fire his workmen at his will has been
subjected to many restraints Industrial Tribunals can by their award make a contract which is
binding on both the parties creating new right and imposing new obligations arising out of the
award. There is no question of the employer agreeing to the new contract, it is binding even
though it is unacceptable to him.

The creation of new obligations is not by the parties themselves. Either or both of them may
be opposed to it, nevertheless it binds. Them. Thus, the idea of some authority making a
contract for the workmen and employer is a strange and novel idea and is foreign to the basic
principle of the law of contract.

Similarly there is change in the concept of master and servant. One who invests capital is no
more a master and one who puts in labour is no more a servant. They are employer and
employees, the former may hire the latter but he can no more fire them at his will. The
interest of the employees is in many respects protected by legislation. Both are now parties in
an enterprise, without one yielding to the higher status of another but as co-sharer in the
partnership. Even the right of labour participation in the management has been given
legislative recognition to the utter despair of the capitalist. Most of the benefits claimed by a
workman are not part of his bargain with the employer when the latter employed him or are
not due to them on account of any contract but of "status". The industrial society all over the
world has been moving during the present century from contract to status and this status is a
politico-socio-economic juristic status.'

For the efficient functioning of a working unit an amicable environment, cooperation

between the workers and the employers, reasonable remuneration and proper working
condition are the prerequisites.

From the laissez faire to the ‘welfare state’, the socio-economic conditions have faced drastic
changes, not only in India but also across the world. The industrial position that prevailed in
the pre-independence era of India does not remain pristine.

The industrial revolution in India brought with it certain inhumane as well as unjust aspects
of the colonial era. To cope with these problems, industrial legislations were enacted in India.
To keep pace with the changing socio-economic conditions in India, the Legislature as well
as the Courts had to check the unfavourable growth of the industrial legislations.

Industrial legislation finds its origin from the industrial jurisprudence, which is a
development of the 20th century world. In India, industrial jurisprudence prevailed before the
Independence, but it was in the rudimentary form. Industrial revolution was the emanating
factor behind the growth of the industrial jurisprudence.

Industrial revolution brought with it the most inhumane aspect of the human life. It saw the
exploitation of a man by a man. The maximization of profit, even at the cost of the life of the
labourers, was paramount goal of the employer. ‘Freedom of contract’ was the evident result
of the laissez faire. The employer was free to fire the employee, at his arbitrariness. Thus the
employees were always at the loss.

To protect the interest of the employees, the legislature and courts, in India took a giant
step to give birth to the industrial jurisprudence in India- former trough the enactments and
the latter through the judgments. The scope of industrial jurisprudence not only covers the
protection of interests of the employees but it also aims at securing a cordial relationship
between the employers and employees in a working unit.
EVIL IMPACT OF INDUSTRIAL REVOLUTION ON INDIA

As per the economic policy of the British government, they never wanted to make India an
industrial base, rather they wanted to make India a supplier of raw materials for their
industries. Instead of promoting industries in India, they continued to de-industrialise and
ruralise the Indian economy. Further with the advent of industrial revolution in England, the
British government revved up its efforts to further exploit the Indian economy. As a result, in
1947, when the British left, India represented a ruined economy, a sick society and the
present danger of the evil effects of neo-colonialism. However, the evil impact of industrial
revolution can be classified into Social Evils and Economic Evils, which are discussed as
below:

Economic Evils

1. The artisans lost the psychological satisfaction that they derived in producing goods
themselves. In the industries, they had to produce only a part of the finished goods.

2. The labourers were underpaid. They could just earn from hand to mouth. The wages
were sufficient to provide them with the daily bread, but at the cost of other necessities of
their life.

3. The term of employment was not secure. The employers were free to exercise their
arbitrariness in sacking the labourers. The factory workers had to suffer from the periodic
unemployment and under-employment.

Social Evils

1. The overcrowded cities, due to the large-scale immigration of the village population in
the cities led to the industrial slums and acute housing problems. It had its adverse impact on
the health of the workers and also led to the sanitation problems in the cities.

2. The working condition in the factories was hazardous. Moreover, the long hours of
duty, with no rest and no facility of recreation marred the welfare of the workers. The
machines were taken care of by the factory owners, with little regard for the safety of the
workers.

3. Workers were exposed to serious accidents caused by the improperly managed machines
in the factory. These accidents were not taken seriously by the factory owner. The victims of
such accidents did not have any right to compensation.
4. Due to the inadequate wages, the wives and children of the workers were exposed to the
exploitation by the factory owners. They were employed at low wages without regard to
their physical conditions.

LABOUR PROBLEMS IN INDIA

The factory owners paid their sole attention towards the maintenance of the machines
irrespective of the health and working conditions of the workers. The employers neglected
the conditions of the workers as the manual labour was abundantly available to them. The
workers were underpaid. They could not raise their voice. They were illiterate and poor, so
were ignorant of their rights. Taking the advantage of this situation, the employers dictated
their own terms.

The government also did not interfere in the matter as it was deemed to be a freedom of
contract. The situation worsened further. The government could not just see it as a neutral
player and it had to interfere. Moreover, some of the philanthropic agencies like the
Servants of India Society and Social Service League raised voice against these problems.
Later some industrial social workers also raised voice against these problems. Initially, they
lacked in the resources and bargaining power but they were successful in mobilising the
public voice against these problems.

Later, the factory owners also realised the seriousness of the problem and also that a
contended worker will add to the productivity of the factory.

Later the Government also, could not confine itself to a neutral spectator. The Government
also realised that it was in the interest of the national economy as well as the labourers that
constitute a bulk of population in India. Thus the drive for the welfare of the labourers
and for the protection of the Indian economy compelled the Government to intervene in
the situation.

EVOLUTION OF INDUSTRIAL JURISPRUDENCE IN INDIA

The evolution of Industrial Jurisprudence in India can be traced back to the period of post
Independence. Before the Independence, the industrial jurisprudence existed in a rudimentary
form. The paramount concern of the Pre-independence industrial jurisprudence was the
amelioration of the working condition of the workers at the factories. There was hardly any
deal with the social justice to the working class. It was only after the commencement of our
Constitution, that the adequate provisions for the social justice to the workers were inserted.
Before the Independence, India was not only a great agricultural country, but also a
manufacturing country. But the British Government, as a matter of their policies always
tended to discourage the Indian industries. This led to a widespread nationalism in India,
which laid emphasis on the boycott of the foreign goods. Further a non-cooperation
movement saw its birth that is also called swadeshi movement, which emphasized on the use
of indigenous goods and boycott of the foreign goods.

The aspect of industrialization in India was based on the program of planning, which was
accepted after thirties.

It is important to take into consideration that the plantation industry of Assam was the first to
attract the industrial legislation. The situation there was that the employers exercised hard
practices against the employees. The employees were not allowed to leave the tea gardens. A
number of Acts were passed from 1863 onward, but they only protected the interests of the
employers. Some other Acts 5 were also passed to regulate the condition. But the Workmen’s
Compensation Act, 1923 was the landmark Act.

INDIAN CONSTITUTION AND SOCIAL JUSTICE

Industrial Jurisprudence was not in a much developed form before the commencement of the
Constitution of India. Before the Independence, the paramount concern of the Government
was to ameliorate the condition of the factory workers. It was after the commencement of
the Constitution that the paramount concern of the Government shifted towards the
social justice for the labourers, who constituted the bulk of the population.

Bhagwati J., in a landmark case opined that concept of justice does not emanate from the
fanciful notions of any particular adjudication but must be founded on a more solid
foundation. Justice Gajendragadkar opined that “the concept of social and economic justice is
a living concept of revolutionary import; it gives sustenance to the rule of law and meaning
and significance to the idea of welfare state”.

The Indian Constitution also enshrines the idea of social justice as one of the objectives of the
State. Some of those provisions are as follows:
1. The State shall strive to promote the welfare of the people by securing and protecting as
effectively as it may a social order in which justice, social, economic and political, shall
inform all the institutions of the national life. (Article 38)

2. The State shall, in particular, strive to minimise the inequalities in income, and endeavour
to eliminate inequalities in status, facilities and opportunities, not only amongst individuals
but also amongst groups of people residing in different areas or engaged in different
vocations. (Article 38)

3. Article 39 the State shall, in particular, direct its policy towards securing-:

a. that the citizen, men and women equally, have the right to an adequate means of
livelihood;

b. that the ownership and control of the material resources of the community are so
distributed as best to sub serve the common good;

c. that the operation of the economic system does not result in the concentration of wealth
and means of production to the common detriment;

d. that there is equal pay for equal work for both men and women;

e. that the health and strength of workers, men and women, and the tender age of
children are not abused and that citizens are not forced by economic necessity to enter
avocations unsuited to their age or strength;

f. that children are given opportunities and facilities to develop in a healthy manner and in
conditions of freedom and dignity and that childhood and youth are protected against
exploitation and against moral and material abandonment.

LABOUR POLICY IN INDIA

After independence it was largely felt that the labour policy must emphasise upon self-
reliance on the part of the workers. Since independence till 1954, the period when V.V.
Giri was the Labor Minister, all official pronouncements emphasised that labour should
become self-reliant. An equally forceful view had been to prefer reliance upon the
Government. This cross-current of approach to the labour policy gave place to a new
approach known as "Tripartism".

Thus ‘Tripartism' became the central theme in the so-called "Nanda-period" that began in
1957. During this period the Government paid reliance on three party approach, namely
the trade union representing the workers, the employers, and the Government. In this kind
of approach the representatives do not decide anything but their role is mainly advisory. They
meet together, discuss the points in dispute and strive to reach a consensus and if they agree
they make recommendations.

Out of the three, the role of the Government is more important. Annual Labour
Conferences and the permanent standing Labour Committees served as the chief
instrument of Tripartism.

These conferences advocated, amongst many things; workers' participation in management,

workers' education, works committees, and minimum wage legislations. At the sixteenth
conference held in. 1958 a momentous advancement was made by adopting a Code of
Discipline in industry. The Code pledged the parties to avoid strikes and lock-outs
without notice, and to eschew unilateral actions, and to rely on settlement of disputes by
discussion by voluntary arbitration or by adopting to such measures as the law may
provide. It also pledged them to avoid coercion and victimisation, to avoid partial strikes and
lock-outs, and to follow grievance procedure.

Tripartism is an approach which lays stress on the identity of interests between labour
and capital i.e., they are the partners in the maintenance of production and the building
up of the national economy. The labour policy has proceeded on a realisation that the
community as a whole, as well as individual employers are under an obligation to protect the
welfare of workers and to secure to them their due share in the gains of economic
development.' This led to enacting of the Payment of Bonus Act, 1965 which aimed at
providing for the payment of bonus on the basis of profits or on the basis of production or
productivity.'

The main postulates of labour policy may be summed up as follows:

(1) Recognition of the State as the custodian of the interests of the community, as the
catalyst of "change" and welfare programmes.

(2) Recognition of the right of workers to peaceful direct action if justice is denied to them.
(3) Encouragement to mutual settlement, collective bargaining and voluntary arbitration.

(4) Intervention by the State in favour of the weaker party to ensure fair treatment to all
concerned.

(5) Primacy to maintenance of industrial peace.

(6) Evolving partnership between the employer and employees in a constructive endeavour to
promote the satisfaction of the economic needs of the community in the best possible manner.

(7) Ensuring fair wage standards and provisions of social security.

(8) Cooperation for augmenting 'production' and increasing 'productivity'.

(9) Adequate enforcement of legislation.

(10) Enhancing the status of the worker in industry.

(11) Tripartite consultation.

Labour has a vital role in increasing productivity and management has to help create
conditions in which workers can make their maximum contribution towards this objective.

In free India, the labour movement and trade unions should be in a position to assume larger
responsibilities in the context of new scenario and challenges which are coming up on the
advent of 21st century. One of the main tasks in the Five Year Plans is to evolved practical
ways in which they can make an increasing contribution to national development and national
policy.

Economic progress of a country is bound up with industrial place. 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.

The National Commission on Labour, however, preferred to describe its approach as one in
quest of industrial harmony rather than industrial peace as according to it the concept of
industrial peace is somewhat negative and restrictive. It emphasises absence of strife and
struggle.

A quest for industrial harmony is indispensable when a country plans to make economic
progress. It may sound platitudinous but it is nevertheless true that no nation can hope to
survive in the modern technological age, much less become strong, great and prosperous,
unless it is wedded to industrial development and technological advance.

Economic progress is bound up with industrial harmony for the simple reason that industrial
harmony inevitably leads to more cooperation between employers and employees, which
results in more productivity and thereby contributes to all round prosperity of the country.
Healthy industrial relations, on which industrial harmony is founded, cannot therefore, be
regarded, as a matter in which only the employers and employees are concerned; it is of vital
significance to the community as a whole.

That is how the concept of industrial harmony involves the cooperation not only of the
employers and employees but also of the community at large. This cooperation stipulates that
employees and employers recognise that though they are fully justified in safeguarding their
respective rights and interests, they must also bear in mind the interests of the community.

If this be the true scope of the concept of industrial harmony, it follows that industrial
harmony should and ought to emphasise the importance or raising productivity but the
resulting accelerated rate of growth will lead to the good of the community as a whole. That
is the true significance of the doctrine of industrial harmony in its three dimensional aspect.

The term Labour Law is used to denote that body of laws which deal with employment and
non-employment, wages, working conditions, industrial relations, social security and labour
welfare of industrially employed, persons.

The need for labour legislation arises because of:

(i) The relationship between the workers and employers, is one of partnership in the
maintenance of the production and building up of the national economy,

(ii) The community as a whole as well as individual employers are under an obligation to
protect the well-being of workers and to secure to them their due share in the gains of
economic development.

The object of Labour Legislation, therefore, is two-fold namely:

(i) To improve the service conditions of industrial labour so as to provide for them the
ordinary amenities of life.

(ii) To bring about industrial peace which could in its turn accelerate productive activity of
the country resulting in its prosperity.

Labour Legislation is necessary for the following reasons:

(i) The individual workers are economically weak. They cannot bargain with the employers
for the protection of their rights and even for subsistence wages. As such legislation for
protection of labour against long hours of work, unhygienic working conditions, low wages
and exploitation is needed.

(ii) In order to increase the bargaining power of labour, legislation is necessary to encourage
the formation of trade unions.

(iii) In order to avoid industrial disputes which lead to strikes and lockouts, labour legislation
is needed.

(iv) The workers are exposed to certain risks in factories, mines and other establishments. As
such in order to make provision for their health, safety and welfare, legislation is needed.

(v) To protect children and women from taking to work under hazardous conditions and at
odd hours and in hazardous process, laws are necessary.

Labour Legislation has grown up as one of the most important social institution in India. A
quest for industrial harmony is indispensable when a country plans to make economic
progress. It may should platitudinous but it is nevertheless true that no nation can hope to
survive in the modern technological age, much less become strong, great and prosperous.

Unless it is wedded to industrial development and technological advance. Economic progress

is bound up with industrial harmony for the simple reason that industrial harmony inevitably
leads to more cooperation between employers and employees, which results in more
productivity and thereby contributes to all round prosperities of the country.

Healthy industrial relations, therefore on which industrial harmony is founded, cannot be

regarded as a matter in which only the employers and employees are concerned; it is of vital
importance to the community as a whole. That is how the concept of industrial harmony
involves the cooperation not only of the employers and the employees, but also of the
community at large.

Industrial harmony is a product of goodwill and understanding between labour and

management and if for whatever reasons, one or the other side fails to observe the rules of the
game, the laws should be such as to take care of the offenders impartially.

Salient Features of Labour Legislation:

Labour legislation is based on certain fundamental principles:

1. Social Equity:

Another principle on which labour legislation is based on social equity. Legislation based on
social justice fixes a definite standard for adoption for the future, taking into consideration
the events and circumstances of the past and the present. But with the change of
circumstances and ideas there may be a need for the change in the law. This power of
changing the law is taken by the Government by making provisions for rule making powers
in the Acts in regard to certain specified matters.

2. Social Justice:

In an industrial set up, social justice means an equitable distribution of profits and benefits
accruing from industry between industrialists and workers and affording protection to the
workers against harmful effect to their health, safety and morality.

3. International Uniformity:

International uniformity is another principle on which labour laws are based. The important
role played the International Labour Organisation (I.L.O) is praiseworthy. The main aims of
the I.L.O. are to remove injustice, hardship and privation of large masses of toiling people all
over the world and to improve their living and working conditions and thus establish
universal and lasting peace based upon social justice.

The basic principles of the Labour Policy of I.L.O. are as follows:

(a) Labour is not a commodity.

(b) Freedom of expression and of association is essential to continued progress.

(c) Poverty anywhere constitutes a danger to prosperity everywhere.

(d) War against want requires to be carried on with unending vigour within each nation and
by continuous effort is which the representatives of workers and employers enjoying equal
status with those of Governments; join with them in free discussion and democratic decisions
with a view to promoting of common welfare.

4. National Economy:

In enacting labour legislation, the general economic situation of the country has to be borne
in mind lest the very objective of the legislation be defeated. The state of national economy is
an important factor in influencing labour legislation in the country.

Legislation is essential to safeguard the interests of the labouring classes. In the absence of
legislation, factory worker is bound to be exploited by the employer. Labour legislation
provides essential safeguard to workers in matters of conditions of work, hours of work,
safety in the factories, minimum wages, bonus, and equal wages for men and women for the
same work.

The first enactment to be framed was Apprentices Act 1850. The object of this Act was to
better enable children, especially orphans and poor children brought up by public charity, to
learn trades, crafts, and employment, by apprenticing them to livelihood.

However, at that time the policy of the Government was to protect workers from the social
system, and so legislation was acted in 1859 and 1860 making workmen liable to criminal
penalties for branches of contract.

Public attention was drawn to the unsatisfactory working conditions in Indian factories and
the need for regulating or by law them the first time in 1874, when Major Moore, the Chief
Inspector of Bombay Cotton Department, pointed out in his report, that in Bombay Cotton
factories women and children were employed in large numbers, that many of the children
were hardly eight years old, all of them had to work from sunrise to sun set with only half an
hour’s recess and they had no periodically recurring day of rest.

Labour policy in India derives its philosophy and content from the Directive Principles of the
Constitution and has been evolving in response to specific needs of the situation to suit
requirements of planned economic development and social justice.

It has been envisaged that growth of the economy would not only increase production but
also absorb the backlog of unemployment and under-employment and a substantial
proportion of additional labour force. Seventh Plan laid emphasis on harnessing country’s
abundant human resources and improving their capabilities for development.

Different Plan Periods & Development of Labour Policy:

In the First Five Year Plan, the approach to labour problems rested on two considerations
namely the welfare of the working class and the country’s economic stability and progress,
workers’ right to form association, organisation and collective bargaining were recognised.

In order to govern relations between employers and workers, the Planning Commissions
recommended for certain norms, and standards. Works Committees were recommended for
the settlement of differences. During Second Five Year Plan, a code of discipline in industry
was accepted voluntarily by all the organisation of employers and workers which has been in
operation since the middle of 1958.

The code has laid down specific obligations for the management and workers with the object
of promoting constructive cooperation between their representatives all levels. As a result of
this new concept of such far-reaching aims, there has been considerable improvement in the
sphere of industrial relations.

The number of man-days lost declined significantly from 47 lacks during Jan-June 1958 to 19
lacks during July-December 1960. Besides, the inter-union rivalry has been mitigated to some
extent by the code of conduct which was drawn up and accepted by the representatives of
worker’s organisation. The code provides that every employee shall have the freedom and
right awards to join a union of his own choice.
During Second Five Year Plan, two significant steps were undertaken. Firstly a form of
workers’ participation in management was evolved. Joint management councils were
established on experimental basic. The Council has to bring about mutual consultation
between employers and workers over many important issues which affect industrial relations.

Secondly a scheme of workers’ education has been implemented. The scheme comprises
training of teacher- administration and worker teachers. This scheme has helped to raise the
self-confidence of workers and has increased their ability to take advantage of protective
labour laws.

Third Five Year Plan:

Under the Third Five Year Plan, labour policy was designed according to immediate and long
term need of a planned economy. India’s present labour policy is directed towards that
attainment of full employment and assisting standard of living of the people. The concept of
socialist society was kept in mind. Hence, as pointed out in the Third Five Year Plan, the
fruits of progress should be shared in an equitable manner.

The surplus that are generated a social product to which neither the employer not the working
class can lay an exclusive claim, their distribution has to be according to the worth of the
contribution of each, subject to the requirements of further development and his interest of all
the sections of society, in particular, the satisfaction of the basic needs of all its members.

Fourth Five Year Plan:

The labour policy in the Fourth Five Year Plan was evolved with reference to two basic
concepts:

(1) The relationship between workers and employers is one of partnership.

(2) The employees are under obligation to protect the well-living of employees. Greater
emphasis was placed on collective bargaining.

Fifth Five Year Plan:

The labour supply projections contained in the Fifth Plan imply an increase in the labour
force about 18.26 million Hence the plan is oriented towards substantial employment
opportunities.

Sixth and Seventh Five Year Plan:

The labour policy adopted in the Sixth Plan was oriented towards the achievement of
the following objectives:

(i) To establish harmonious relations between employers and workers.

(ii) To accelerate the rate of industrial development and to create expanding opportunities for
employment.

(iii) To rise the living standard of workers in general and the weaker section in particular.

From time to time, suggestions have been made to review the working of labour policy. Since
independence the industrial scene has undergone radical changes. The structure of working
class has changed in several respects. Important changes are likely to take place in the future
and composition of labour movement in the years to come.

Having regard to those considerations in December 1966, the Government of India set up a
National Commission on Labour to study and make recommendations on various aspects of
labour including wages, working conditions, welfare, trade union development and labour-
management relations. The Commission submitted its report in August 1969. It made 300
recommendations. The Government accepted 200 recommendations out of 300 made by the
Commission.

A Tripartite Committee constituted under the scheme- Workers Participation in Management

and comprising representatives of some Central Ministries/State Governments, major public
sector undertakings and Central Trade Union Organisations, reviews progress of the scheme
from time to time and suggests remedial measures.
So far, 8 meetings of this committee have been held. A monitoring cell has also been created
in the Ministry of Labour to assist the Committee. Out of 203 Operational Central Public
Sector Enterprises, 109 have implemented the 1983 scheme at shop floor/plant levels.

As the Third Plan stated, “Labour policy in India has been evolving in response to the
specific needs of the situation in relation to industry and the working class and has to suit the
requirements of a planned economy”.

As a result of consultation between the representatives of the Government, the employers and
employees, a body of principles and practices has grown up and the legislation and other
measures adopted by the Government in this field represent the consensus of opinion of the
parties vitally concerned and thus acquire the strength and character of a national policy.

In the formulation of policies and in their implementation, the Government has set up joint
committees consisting of the representatives of the Government, the employers and the
employees and at the apex of this tripartite machinery is the Labour Conference.

Recent Developments of Labour Legislation:

The structure of industrial relations has been designed to secure industrial peace in industry,
promote production and labour productivity and give a fair deal to the workers. Conciliation
of disputes and adjudication through tribunals has been tried.

The system has helped in reducing industrial unrest and promoting security to working
classes but it has also created the spirit of litigation among the parties concerned. During the
Second Plan, the Government tried a new approach, viz. the Code of Discipline voluntarily
accepted by the parties concerned.

The stress was on the prevention of unrest by timely action in the appropriate stages. Besides,
the Code of Discipline makes it obligatory on the management and labour to promote
constructive co-operation between them, to avoid litigation, settle disputes and grievances by
mutual negotiations, conciliation and voluntary arbitration, facilitate free growth of trade
unions and eliminate all forms of coercion and violence in industrial relations. This new
concept of industrial relations with such far-reaching aims will take some time to be fully
implemented in practice.

Two aspects of labour policy evolved during the Second Plan deserve special mention,
because they hold great promise for the future. One was the workers’ participation in
management which was meant to give the workers a sense of belonging and to stimulate their
interest in higher productivity. This was done in an experimental fashion in 23 industries in
the form of Joint Management Councils.

Its main function was to bring about mutual consultation between employers and employees
over many important issues which affect industrial relations. The second was the programme
of workers’ education which was widely welcomed. The scheme was to train teacher-
administrators and worker-teachers. The latter, when they return to their industrial
establishments, would start unit-level classes for the rank and file of the workers.

Labour Policy and Third Plan:

Industrial relations during the Third Plan were based on the Code of Discipline which was
evolved during the Second Plan. The Third Plan aims at extending an awareness of the Code
to all constituents of the Central Employers’ and Employees’ organisations, so that the Code
would become more and more of a living force in the day-to-day conduct of industrial
relations.

The sanctions on which the Code of Discipline is based were reinforced, relying on the
consent of the parties concerned. The Third Plan also aimed at increased application of the
principles of voluntary arbitration in resolving differences between workers and employers.

Policy Regarding Trade Unions:

Trade unions have to be accepted as an essential part of the apparatus of the industrial and
economic administration of the country. For this, there has to be considerable re-adaptation in
the outlook, functions and practices of trade unions according to the changed conditions and
circumstances in which India is placed now. The Government looks that at present trade
unions are handicapped by insufficient resources and a non-progressive leadership.
According to the Code of Discipline, a trade union will have to be recognised by the
management, provided the former has at least 15 per cent of the workers engaged in the
establishment enrolled as members for a continuous period of six months. In case there are
several unions, the union with the largest membership will be recognised. Once a union is
recognised as such, there should be no change in its position for a period of two years.

POLICY REGARDING WAGES:

A just or even an economically sound wage policy should encourage increase of national
income and secure to the wage earner a legitimate share in that increase. The purpose of the
Government’s wage policy, as clearly stated by the Second Plan, is “to bring wages into
conformity with the expectations of the working class in the future pattern of society.”

The First Plan: The First Plan stated that all wage adjustments should conform to the broad
principles of social policy and the disparities of income should be reduced to the utmost
extent. The immediate aim was to restore the pre-war real wage level, as the first step towards
the living wage.

The First Plan insisted on avoiding any wage rise which would raise the cost of production
and set in motion wage-price spiral; for in such a case, gains to the workers would prove
illusory since they would, in all probability, get cancelled by a rise in the price level.

But soon after Independence, the Government assumed responsibility for securing a
minimum wage for certain sections of workers—both in industry and in agriculture—who
were economically weak and who stood in need of protection. Towards this end, the
Minimum Wages Act was passed in 1948 to provide for the fixation and revision of wage
rates in certain occupations. But the Government was aware that the Act was not effective in
many cases.

The Second Plan:

The Second Plan proposed to give labours a fair wage. Fair wage was distinguished from
minimum and living wage. For instance, minimum wage must provide to the worker and his
family not only sustenance but also something more to preserve his efficiency. Living wage
should enable the worker to provide for himself and for his family not only the bare essentials
of food, clothing and housing but also a measure of comfort, etc.
On the other hand, fair wage was somewhere midway between the minimum and the living
wage and it would be determined with reference to the capacity of the industry to pay the
wage and the prevailing rate of wages in the same or similar industry.

Government’s policy was to link the wage-rise with the rise in productivity. The Second Plan
specifically stated: “Earnings beyond the minimum wage should be necessarily related to
results.”

Third Five Year Plan:

The Government is continuing the wage policy as enunciated by the Second Plan. The Third
Plan has accepted the system of wage boards and also proposes that the unanimous
recommendations of a wage board in an industry should be implemented fully. In the
determination of wages, the need-based minimum wage should be used.

Apart from the minimum wages, adequate incentives should be provided for the acquisition
and development- of skills and for improvements in output and quality. The Third Plan
proposed to appoint a Commission to study the problems connected with bonus claims and to
evolve guiding principles and norms for the payment of bonus.

Working Conditions Safety and Welfare:

The Government has evolved a comprehensive code to ensure satisfactory working

conditions, safety of persons and the provision of a variety of facilities to promote the welfare
of the workers. But the implementation of the statutory provisions has not been effective.

The Third Plan calls upon all State Governments to strengthen the inspectorates provided for
the administration of factory laws. Emphasis is placed on the safety of persons in factories
and mines and appropriate machinery is being devised. Special Welfare funds are being
constituted for financing welfare measures for workers in coal and other mines.

The Government is interested in encouraging workers’ cooperatives in the field of credit,

housing, distribution of consumer goods, etc. The Government feels that trade unions and
voluntary organisations should take initiative and evince interest in starting and running such
cooperatives.

The Third Plan points out that despite the operation of the subsidised Industrial Housing
Scheme, for some years, housing of industrial workers has not made much progress and in
many cases it has actually deteriorated. The Third Plan calls for a new approach to the
problem of industrial housing so that workers would have decent living conditions within a
reasonable period of time.

Employment and Training Schemes:

In a developing economy, the demand for skilled workers would increase continuously and
the Government has various schemes to meet such demand. By the end of the Second Plan,
there were 166 industrial training institutes with 42,000 training seats. The Third Plan has
proposed to increase the number of these institutes to a total of 318 with an additional 58,000
training seats.

The annual training capacity would be raised to 1 lakh. The Government has also made
adequate provisions for “in-plant training” facilities. It has also introduced a voluntary
apprentice training scheme; the Third Plan has proposed to convert this voluntary scheme
into a compulsory one.

The Third Plan has set a target of 14,000 seats for apprentice training scheme. It has also set a
target of 15,000 seats in the programme of evening classes for industrial workers. One
hundred employment exchanges would be set up during the Third Plan period and the
objective is to open one employment exchange in each district.

GROWTH OF LABOUR LEGISLATION IN INDIA

Labour legislation in India grew with the growth of industry. In the eighteenth century India
was not only a great agricultural country but a great manufacturing country too. Asian and
European markets were mainly fed by the looms supplied by India. But the British
Government in India as a matter of policy discouraged Indian manufacturers in order to
encourage the rising manufacturers of England. Their policy was to make India subservient to
the industries of Great Britain and to make Indian people grow only raw materials.

The British oppression in India continued for a considerable time which led to the growth of
Indian nationalism and to a vigorous renaissance. Nationalism has an obvious economic
aspect which in our country was reflected in the urge for economic reforms and for
industrialisation. In the 20th century the national movement took a new turn and there was
a common demand for the Indian goods. A non-co-operation movement which is known as
Swadeshi movement was started which urged upon the people to use goods made in India
and to boycott foreign goods.

The non-co-operation movement synchronised with periods of economic crisis gave impetus
to industrialisation. Not only that, growth of Indian private sector owes much to these popular
movements. No doubt, the Indian Economists, drew their inspiration from British classical
Economists but they outgrew those ideas.' Like British Economists, Indian Economists not
only advocated that the trade and commerce should be free but they laid emphasis on the free
trade of local goods. An attempt was made to put forward a theory of economic development
and planning suited to conditions of our country. After thirties planning was accepted by
the national movement as its economic ideology. Thus, planned industrialisation became
our main goal.

In India, the plantation industry in Assam was the first to attract legislative control. The
method of recruitment of workers in this industry was full of hardships. Workers were
employed through professional recruiters. Workers were not allowed by the planters to leave
the tea gardens. A number of Acts were passed from 1863-onwards to regulate the
recruitments. These legislations protected more the interests of the employers than
safeguarding the interest of the worker. The Factories Act was passed in 1881 and the Mines
Act in 1901. But the most important of such Acts as were passed to protect the interest of the
workers was the Workmen's Compensation Act, 1923. Some other important social security
legislations are : the Employees' State Insurance Act, 1948, the Employee's Provident Funds
Act, 19523 and the Maternity Benefit Act, 1961.

Laws were also made to regulate the labour management relations. Some of them are : the
Industrial Disputes Act, 1947, the Trade Unions Act, 1926 and the Industrial Employment
(Standing Orders) Act, 1946. Labor legislations ensuring labour welfare and minimum
standards were also enacted. Some of them are: the Factories Act, 1948, the Minimum Wages
Act, 1948, the Payment of Wages Act, 1936 and the Payment of Bonus Act. 1965.