34  Industrial Relations — Disputes, Welfare, Social Security

34.1 What is Industrial Relations?

Industrial Relations (IR) is the study of relationships between the workers (and their unions), employers, and the state, governed by law, custom and collective agreement, to regulate the terms of employment and address conflict. The term “industrial relations” entered usage with John R. Commons at the University of Wisconsin (1920s), often called the father of American industrial relations.

TipWorking definitions of IR
Author Definition
Dale Yoder “A relationship between management and employees or among employees and their organisations that characterise or grow out of employment.”
J.T. Dunlop “An industrial-relations system consists of three actors — workers and their organisations, managers and their organisations, and governmental agencies — whose interactions are bounded by an ideology and a body of rules.”
V.B. Singh “Whole gamut of relationships and interactions between employers and employees… concerned with the system, rules and procedures used by unions and employers.”
ILO “Relations between the state, employer and worker, and their associations, to determine the rights and obligations involved.”
Richard Hyman “Processes of control over work relations and the institutions in which control is contested.”

34.2 Dunlop’s Systems Theory

John T. Dunlop’s Industrial Relations Systems (1958) is the foundational theoretical framework — IR is a system of four components:

TipDunlop’s IR system — four elements
  • Three actors — workers + unions, managers + employers, and government + its agencies.
  • Environmental contexts — technological, market, distribution of power.
  • Ideology — shared beliefs that bind the system.
  • Web of rules — substantive (pay, hours, benefits) + procedural (how rules are made) + administrative (how rules are applied).

flowchart TB
  W[Workers &<br/>Unions] --- I[Ideology &<br/>Web of Rules]
  M[Management &<br/>Employers] --- I
  G[Government &<br/>Agencies] --- I
  E[Environmental<br/>Contexts] --- I
    classDef default fill:#003366,color:#ffffff,stroke:#ffcc00,stroke-width:3px,rx:10px,ry:10px;

34.3 Theoretical Perspectives on IR

TipFour classical perspectives on IR
Perspective Core view Key author
Unitarist One team, common interest; conflict = pathology Alan Fox (1966)
Pluralist Multiple legitimate interests; conflict normal, managed through negotiation Alan Fox; Hugh Clegg
Marxist / Radical Fundamental conflict of capital and labour; structural inequality Marx, Hyman
Systems IR as a self-regulating system of actors and rules Dunlop
NoteAlan Fox — Unitarist vs Pluralist

Alan Fox’s influential Donovan Commission research paper (1966) distinguished unitarist (one happy family, conflict = aberration, no need for unions) from pluralist (multiple legitimate stakeholders, conflict natural, unions are healthy). Modern HRM is generally unitarist; traditional IR is pluralist.

34.4 Objectives of Industrial Relations

TipObjectives of IR
  • Industrial peace — prevention and settlement of disputes.
  • Industrial democracy — worker participation.
  • Increased productivity through cooperation.
  • Safeguarding workers’ rights and bargaining power.
  • Safeguarding management’s rights to manage.
  • Economic growth — stable industrial environment.
  • Social justice — fair wages, working conditions, welfare.
  • Mental revolution (Gandhian) — change of mindset on both sides.

34.5 Approaches to IR

TipApproaches to Industrial Relations
Approach Idea Author
Systems Tripartite rule-making system Dunlop
Human Relations Informal groups + emotion + cooperation Mayo
Gandhian Trusteeship + non-violent settlement M.K. Gandhi
Marxist Class conflict of capital and labour Marx, Hyman
Pluralist Multiple stakeholders, negotiated order Fox, Clegg
Unitarist One team, common goals Fox
Strategic Choice Management actively chooses IR strategy Kochan, Katz, McKersie (1986)

34.6 Industrial Disputes

34.6.1 Definition

Industrial Disputes Act 1947, Section 2(k) — “Any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or the terms of employment or with the conditions of labour, of any person.”

34.6.2 Causes of Industrial Disputes

TipCommon causes of industrial disputes
  • Economic causes — wages, bonus, allowances, benefits.
  • Political causes — political affiliation of unions.
  • Personnel causes — dismissal, retrenchment, transfer.
  • Indiscipline and violence.
  • Working conditions — safety, hours, leave.
  • Recognition of unions and bargaining rights.
  • Productivity and workload disputes.
  • Management practices — favouritism, harassment.
  • Inter-union rivalry.
  • Government policies — privatisation, layoffs.

34.6.3 Forms of Industrial Action

TipForms of industrial action
Form Meaning
Strike Concerted cessation of work by workmen
Lock-out Temporary closure of place of employment by the employer
Gherao Encirclement of management to coerce
Bandh Total shut-down — political/regional
Go-slow Deliberate slowing of work
Work-to-rule Strict adherence to rules to slow output
Sit-down / Tool-down strike Workers come to work but do nothing
Hunger strike Refusal to eat, often by union leaders
Picketing Demonstrators at workplace entrance
Boycott Refusal to deal with the firm

34.6.4 Types of Strikes — IDA Classification

TipTypes of strikes under the Industrial Disputes Act
  • Economic strike — over wages, bonus, conditions.
  • Sympathetic strike — in solidarity with another union’s strike.
  • General strike — across many industries.
  • Sit-down strike — workers at workplace but idle.
  • Slow-down strike — go-slow.
  • Hunger strike — usually leaders.
  • Wildcat strike — without union authorisation or notice.
  • Illegal strike — in violation of IDA provisions (Sec. 22, 23).
NoteSection 22 of IDA — strike notice

In a public utility service, no strike or lock-out is legal without 14 days’ written notice. The notice is valid for 6 weeks. No strike during pendency of conciliation or adjudication.

34.7 Settlement Machinery

The IDA 1947 created a five-tier machinery:

TipSettlement machinery under IDA 1947
Mechanism Role
Works Committee (Sec. 3) Joint committee of equal employer-employee reps; minor disputes; firms with 100+ workers
Conciliation Officer (Sec. 4) Govt. officer attempts settlement
Board of Conciliation (Sec. 5) 2 or 4 members + chair; tougher disputes
Court of Inquiry (Sec. 6) Fact-finding — no binding award
Labour Court (Sec. 7) Adjudication — discharge, standing orders
Industrial Tribunal (Sec. 7A) Bigger issues — wages, bonus, hours
National Tribunal (Sec. 7B) National importance / multi-state
Voluntary Arbitration (Sec. 10A) By agreement of parties; binding
Grievance Redressal Committee (Sec. 9C) Internal — firms with 20+ workers (2010 amendment)

34.7.1 Three Stages of Settlement

flowchart LR
  P[Prevention<br/>Works Cttee,<br/>WPM, GRC] --> C[Conciliation<br/>Officer & Board]
  C --> A[Adjudication<br/>Labour Court,<br/>Tribunal, National Tribunal]
  C --> V[Voluntary<br/>Arbitration<br/>Sec. 10A]
    classDef default fill:#003366,color:#ffffff,stroke:#ffcc00,stroke-width:3px,rx:10px,ry:10px;

34.8 Workers’ Participation in Management (WPM)

WPM — workers share in managerial decisions. Levels described by Mehtras:

TipMehtras’s six levels of WPM
  • Informative — management shares information.
  • Consultative — workers consulted, no decision power.
  • Associative — workers help in decision-making, advisory.
  • Administrative — workers share in administering policies.
  • Decisive — joint decisions on selected matters.
  • Self-management — workers manage themselves (Yugoslav model).

34.8.1 Forms of WPM in India

TipWPM forms in India
  • Works Committee (Sec. 3 IDA 1947) — for firms with 100+ workers.
  • Joint Management Council (JMC) — recommended 1958 Industrial Policy Resolution.
  • Shop Council and Joint Council (1975) — Indira Gandhi’s scheme.
  • Workers on Board — Public-sector experiments (since 1970s).
  • Suggestion Schemes.
  • Quality Circles (Ishikawa; widespread in BHEL, L&T).
  • Self-Directed Work Teams.
  • Constitutional provision — Article 43A — “State shall take steps to secure participation of workers in management.”

34.9 Tripartism in India

Three tripartite bodies (employer + worker + government):

TipIndian tripartite bodies
Body Established
Indian Labour Conference (ILC) 1942 (then “Tripartite National Labour Conference”)
Standing Labour Committee (SLC) 1942
Industrial Tripartite Committees (industry-specific) Various
Wage Boards First in 1957

34.10 Labour Welfare

Labour welfare covers anything done for workers’ comfort and improvement, intellectual or social, over and above the wages paid. The Royal Commission on Labour (1931) under J.H. Whitley in India laid the early foundations. ILO (Geneva) defines welfare as facilities and amenities… which contribute to better workers’ health, efficiency and morale.

34.10.1 Statutory vs Voluntary Welfare

TipStatutory vs Voluntary welfare measures
Type Examples
Statutory (mandated by law) Drinking water, latrines, washing facilities, first-aid, canteens (250+), crèches (50+ women), rest shelters
Voluntary Recreation, libraries, transport, housing, schools, scholarships
Mutual Cooperative societies, sports clubs

34.10.2 Welfare Provisions — Factories Act 1948

TipWelfare provisions in Factories Act 1948
  • Drinking water (Sec. 18).
  • Latrines and urinals (Sec. 19).
  • Spittoons (Sec. 20).
  • Washing facilities (Sec. 42).
  • Facilities for storing and drying clothing (Sec. 43).
  • Sitting facilities (Sec. 44).
  • First-aid appliances (Sec. 45) — at least one for every 150 workers.
  • Canteens (Sec. 46) — for firms with 250+ workers.
  • Shelters, rest-rooms and lunch-rooms (Sec. 47) — for firms with 150+ workers.
  • Crèches (Sec. 48) — for firms with 30+ women workers.
  • Welfare officers (Sec. 49) — for firms with 500+ workers.

34.10.3 Three Approaches to Welfare

TipThree approaches to welfare
  • Paternalistic / Religious approach — duty of employer (e.g., Tata’s housing in Jamshedpur).
  • Police approach — state coerces minimum welfare; Factories Act.
  • Functional approach — welfare improves productivity (modern HRM).

34.11 Social Security

Social Security = protection that society provides to its members against economic and social distress caused by sickness, maternity, employment injury, occupational disease, unemployment, invalidity, old age and death (ILO Convention 102 — Minimum Standards 1952). The term originated with the US Social Security Act 1935 (FDR’s New Deal).

34.11.1 Beveridge Report (1942)

Sir William Beveridge’s Social Insurance and Allied Services (1942) gave the modern welfare state its blueprint. Beveridge named five giants to fight: Want · Disease · Ignorance · Squalor · Idleness.

34.11.2 ILO Branches of Social Security

TipILO Convention 102 — nine branches of social security
  • Medical care
  • Sickness benefit
  • Unemployment benefit
  • Old-age benefit
  • Employment injury benefit
  • Family benefit
  • Maternity benefit
  • Invalidity benefit
  • Survivors’ benefit

34.11.3 Indian Social Security Architecture

TipIndian social security — pre-Code framework
Scheme / Act Year Coverage
Workmen’s Compensation Act (now Employees’ Compensation Act) 1923 Injury, occupational disease
Employees’ State Insurance Act (ESIC) 1948 Medical + sickness + maternity + injury
Employees’ Provident Fund (EPF) Act 1952 Retirement savings, pension (EPS 1995), insurance (EDLI)
Maternity Benefit Act 1961 (amended 2017 — 26 weeks) Maternity
Payment of Gratuity Act 1972 Lump sum at exit (5+ yrs service)
Unorganised Workers’ Social Security Act 2008 Informal-sector workers
Atal Pension Yojana 2015 Pension for unorganised sector
Pradhan Mantri Suraksha Bima Yojana (PMSBY) 2015 Accident insurance ₹2 lakh
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) 2015 Life insurance ₹2 lakh
PM Shram Yogi Maan-dhan 2019 Pension for unorganised workers
e-Shram Portal 2021 National database of unorganised workers

34.11.4 Code on Social Security, 2020

The Code on Social Security 2020 consolidates 9 central labour laws including EPF, ESI, Maternity, Gratuity, Building Workers and Unorganised Workers Acts. Key features: universal coverage including gig and platform workers; social security fund for unorganised workers; mandatory Aadhaar for registration.

34.12 The Four New Labour Codes (2019-20)

India consolidated 29 central labour laws into four codes:

TipThe Four Labour Codes (2019-20)
Code Year Consolidates Key change
Code on Wages 2019 4 laws — Minimum Wages, Payment of Wages, Payment of Bonus, Equal Remuneration Universal minimum wage, National floor wage
Industrial Relations Code 2020 3 laws — Trade Unions, Industrial Disputes, Standing Orders Fixed-term employment recognised; layoff threshold 100 → 300; Negotiating Union/Council
Code on Social Security 2020 9 laws — EPF, ESI, Maternity, Gratuity, etc. Coverage of gig/platform workers
Code on Occupational Safety, Health & Working Conditions (OSH) 2020 13 laws — Factories, Contract Labour, Migrant Workers, etc. Single registration, single licence
NoteIR Code — major reform

IR Code 2020 raised the threshold for prior government permission for layoff, retrenchment or closure from 100 to 300 workers — easing of labour-flexibility rules. It also introduced fixed-term employment at par with permanent workers in benefits.

34.13 Practice Questions

Q 01 Dunlop Easy

The Systems Theory of Industrial Relations was given in 1958 by:

  • ADale Yoder
  • BJohn T. Dunlop
  • CAlan Fox
  • DRichard Hyman
View solution
Correct Option: B
John T. Dunlop, *Industrial Relations Systems* (1958).
Q 02 Dunlop actors Medium

Dunlop's three actors in the IR system are workers/unions, employers and:

  • ACustomers
  • BGovernment and its agencies
  • CShareholders
  • DNGOs
View solution
Correct Option: B
Three actors: workers + unions · employers + managers · government + agencies.
Q 03 Alan Fox Medium

The distinction between Unitarist and Pluralist perspectives in IR was popularised in 1966 by:

  • AAlan Fox
  • BDunlop
  • CClegg
  • DKochan
View solution
Correct Option: A
Alan Fox — Donovan Commission research paper (1966).
Q 04 IDA notice Medium

Under Section 22 of the IDA 1947, the strike notice in a public utility must be given how many days in advance?

  • A7 days
  • B14 days
  • C21 days
  • D30 days
View solution
Correct Option: B
14 days; notice valid for 6 weeks.
Q 05 Wildcat strike Medium

A strike launched without union authorisation or prior notice is called:

  • AGeneral strike
  • BWildcat strike
  • CSit-down strike
  • DSympathetic strike
View solution
Correct Option: B
Wildcat / unauthorised strike.
Q 06 Works Committee Medium

Works Committees under Section 3 of the IDA 1947 are compulsory in establishments with:

  • A20 or more workers
  • B50 or more workers
  • C100 or more workers
  • D300 or more workers
View solution
Correct Option: C
100 or more workers. Equal employer-employee representation.
Q 07 Beveridge Hard

Beveridge's "Five Giants" to fight in his 1942 report did NOT include:

  • AWant
  • BDisease
  • CSqualor
  • DInflation
View solution
Correct Option: D
Five Giants: Want · Disease · Ignorance · Squalor · Idleness. Inflation not listed.
Q 08 ILO 102 Medium

The minimum standards for social security across 9 branches were laid down in:

  • AILO Convention 87
  • BILO Convention 98
  • CILO Convention 102
  • DILO Convention 138
View solution
Correct Option: C
ILO Convention 102 (1952) — Social Security (Minimum Standards).
Q 09 ESI Act Easy

The Employees' State Insurance Act was enacted in:

  • A1923
  • B1948
  • C1952
  • D1972
View solution
Correct Option: B
ESI Act 1948 — medical, sickness, maternity, injury benefits.
Q 10 EPF Act Easy

The Employees' Provident Fund Act was enacted in:

  • A1948
  • B1952
  • C1961
  • D1972
View solution
Correct Option: B
EPF Act 1952. EPS added 1995; EDLI 1976.
Q 11 Gratuity Medium

The Payment of Gratuity Act applies after how many years of continuous service?

  • A3 years
  • B5 years
  • C7 years
  • D10 years
View solution
Correct Option: B
5 years of continuous service. Payment of Gratuity Act 1972.
Q 12 Whitley Hard

The Royal Commission on Labour (1931) in India was chaired by:

  • AB.P. Adarkar
  • BJ.H. Whitley
  • CP.S. Sivaswami Iyer
  • DV.V. Giri
View solution
Correct Option: B
J.H. Whitley — Whitley Commission, 1931.
Q 13 Factories canteen Medium

Under the Factories Act 1948, a canteen is mandatory in establishments employing:

  • A100 or more
  • B150 or more
  • C250 or more
  • D500 or more
View solution
Correct Option: C
250 or more workers — Sec. 46.
Q 14 IR Code 2020 Hard

The IR Code 2020 raised the threshold for prior government permission for layoff/closure from 100 to:

  • A150
  • B200
  • C300
  • D500
View solution
Correct Option: C
Threshold raised to 300 workers — major labour-flexibility reform.
Q 15 Four Codes Medium

The four labour codes consolidated how many central labour laws?

  • A21
  • B29
  • C44
  • D52
View solution
Correct Option: B
29 central labour laws consolidated into 4 codes (Wages 2019, IR/Social Security/OSH 2020).
Q 16 Mehtras Hard

The six-level model of Workers' Participation in Management (Informative → Consultative → Associative → Administrative → Decisive → Self-management) is attributed to:

  • AMehtras
  • BLikert
  • CMcGregor
  • DDavis
View solution
Correct Option: A
Mehtras — six levels of WPM.
Q 17 Article 43A Hard

Which Article of the Indian Constitution mandates the state to secure workers' participation in management?

  • AArticle 39
  • BArticle 41
  • CArticle 42
  • DArticle 43A
View solution
Correct Option: D
Article 43A — DPSP added by 42nd Amendment (1976).
Q 18 Strategic Choice Hard

The "Strategic Choice" approach to IR (1986) — management chooses an IR strategy — is associated with:

  • ADunlop
  • BKochan, Katz & McKersie
  • CFox & Clegg
  • DBeer et al. (Harvard)
View solution
Correct Option: B
Kochan, Katz and McKersie, *The Transformation of American Industrial Relations* (1986).
Q 19 e-Shram Medium

The e-Shram portal — a national database of unorganised workers — was launched in:

  • A2018
  • B2019
  • C2020
  • D2021
View solution
Correct Option: D
e-Shram — August 2021.
Q 20 Match Acts Hard

Match the Act with its year:

(i) Workmen's Compensation Act (a) 1948
(ii) ESI Act (b) 1952
(iii) EPF Act (c) 1923
(iv) Gratuity Act (d) 1972
  • A(i)-(c), (ii)-(a), (iii)-(b), (iv)-(d)
  • B(i)-(a), (ii)-(b), (iii)-(c), (iv)-(d)
  • C(i)-(d), (ii)-(b), (iii)-(a), (iv)-(c)
  • D(i)-(b), (ii)-(c), (iii)-(d), (iv)-(a)
View solution
Correct Option: A
Workmen's Comp 1923 · ESI 1948 · EPF 1952 · Gratuity 1972.

34.13.1 Advanced Format Questions

AR 1Assertion-ReasonHard

A: India consolidated 29 labour laws into 4 codes (2020).
R: The four codes are Wages, Industrial Relations, Social Security, OSH&WC.

  • ABoth true; R explains A
  • BBoth true; R does not explain A
  • CA true, R false
  • DA false, R true
View solution
Correct Option: A
AR 2Assertion-ReasonMedium

A: ID Act 1947 governs industrial disputes.
R: Authorities include Conciliation Officer, Board, Court, Tribunal.

  • ABoth true; R explains A
  • BBoth true; R does not explain A
  • CA true, R false
  • DA false, R true
View solution
Correct Option: A
S 1Statement-basedMedium

4 Labour Codes (2019-20): (i) Wages. (ii) IR. (iii) Social Security. (iv) OSH&WC.

  • AAll four
  • B(i) and (ii) only
  • C(iii) and (iv) only
  • D(i), (ii), (iii) only
View solution
Correct Option: A
S 2Statement-basedHard

Social-security schemes: (i) EPF. (ii) ESI. (iii) Gratuity. (iv) Maternity benefit.

  • AAll four
  • B(i) and (ii) only
  • C(iii) only
  • D(i), (ii), (iii) only
View solution
Correct Option: A

34.14 Quick Recall

ImportantQuick recall
  • IR origin: John R. Commons (Wisconsin, 1920s).
  • Definitions: Yoder · Dunlop (1958 — Systems theory, 3 actors) · V.B. Singh · ILO · Hyman.
  • Dunlop’s 4 elements: 3 Actors · Environmental Contexts · Ideology · Web of Rules (substantive/procedural/administrative).
  • Four perspectives: Unitarist & Pluralist (Fox 1966) · Marxist · Systems.
  • 8 objectives of IR including Gandhian “mental revolution”.
  • 7 approaches: Systems · Human Relations · Gandhian · Marxist · Pluralist · Unitarist · Strategic Choice (Kochan-Katz-McKersie 1986).
  • Disputes — IDA Sec. 2(k); causes economic, political, personnel, conditions, recognition.
  • Forms of action: Strike · Lock-out · Gherao · Bandh · Go-slow · Work-to-rule · Hunger · Picketing · Boycott.
  • Strike types: Economic · Sympathetic · General · Sit-down · Slow-down · Hunger · Wildcat (no authorisation) · Illegal.
  • Sec. 22 IDA — 14 days strike notice in public utility; valid 6 weeks.
  • Settlement machinery: Works Committee (100+) · Conciliation Officer · Board · Court of Inquiry · Labour Court · Industrial Tribunal · National Tribunal · Voluntary Arbitration (Sec. 10A) · GRC (Sec. 9C).
  • WPM Levels — Mehtras (6): Informative → Consultative → Associative → Administrative → Decisive → Self-management.
  • Article 43A — Constitutional DPSP on WPM.
  • Tripartite bodies: ILC (1942) · SLC (1942) · Wage Boards (1957).
  • Welfare: Whitley Royal Commission (1931); ILO definition; statutory vs voluntary; Factories Act 1948 — drinking water, canteen (250+), crèche (30+ women), welfare officer (500+).
  • Three welfare approaches: Paternalistic · Police · Functional.
  • Social Security: Origin — US Social Security Act 1935; Beveridge Report 1942 (five giants: Want, Disease, Ignorance, Squalor, Idleness); ILO Convention 102 (1952) — nine branches.
  • Indian Acts: Workmen’s Comp 1923 · ESI 1948 · EPF 1952 (EPS 1995) · Maternity 1961 (26 weeks 2017) · Gratuity 1972 (5 yrs) · Unorganised Workers 2008 · APY/PMSBY/PMJJBY (2015) · PM-SYM 2019 · e-Shram 2021.
  • Four Labour Codes (2019-20) consolidating 29 laws: Wages 2019 · IR 2020 (layoff threshold 100→300; fixed-term employment) · Social Security 2020 (gig workers) · OSH 2020.