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Unit 2 of 4 · B.Com Sem 6

Unit 2: Collective bargaining & grievance management

Industrial Relations and Labour Laws notes · PTU syllabus (BCOM 601-18)

3 min read5 topics10 exam questions
On this page
  1. Unit summary
  2. Concept and prerequisites of collective bargaining
  3. The bargaining process and principles
  4. Labour–management cooperation in India
  5. Grievances: causes and effects
  6. Negotiation, collective settlements and grievance redressal
  7. Key terms
  8. Quick revision
  9. Important questions

Unit summary

Collective bargaining lets workers and management settle terms together, while grievance procedures resolve individual complaints. This unit covers the concept and prerequisites of collective bargaining, the bargaining process and principles, labour–management cooperation in India, the causes and effects of grievances, negotiation and collective settlements, and the grievance redressal procedure.

After this unit you can

  • Explain the concept, types and prerequisites of collective bargaining
  • Explain the process and principles of collective bargaining
  • Explain labour–management cooperation in India
  • Explain causes and effects of grievances and the redressal procedure

PTU syllabus topics

  • Concept and prerequisites of collective bargaining
  • the bargaining process and principles
  • labour-management cooperation in India
  • causes and effects of grievance
  • negotiation and collective settlements
  • grievance redressal procedure
ProcessCollective bargaining process
  1. 1Preparation

    Union and management set goals

  2. 2Negotiation

    Exchange of proposals

  3. 3Agreement

    Terms accepted by both

  4. 4Implementation

    Agreement put into practice

  5. 5Review

    Disputes handled through grievance procedure

1

Topic 1

Concept and prerequisites of collective bargaining

Collective bargaining is the process of negotiation between employers and organised workers (through unions) to determine terms and conditions of employment (ILO).

  • Features: collective, bipartite, continuous, flexible, dynamic, a form of industrial democracy.
  • Types (Chamberlain): conjunctive (distributive — fixing shares), cooperative (mutual dependence), integrative (problem-solving, win-win), concessionary (union gives up gains to save jobs), productivity bargaining (wages linked to productivity).
  • Levels: plant level, industry level (banking — IBA and unions), national level.
ClassificationPrerequisites for successful collective bargaining
Prerequisites

  • Strong, representative union

  • Recognition of the union by management

  • Willingness to negotiate in good faith

  • Freedom of association

  • Mutual trust and respect

  • Problem-solving attitude

  • Supportive legal framework

  • Proper records and data

2

Topic 2

The bargaining process and principles

ProcessCollective bargaining process
  1. 1Preparation

    Collect data on wages, productivity, profits; frame demands (charter of demands)

  2. 2Negotiation

    Discussion, proposals and counter-proposals

  3. 3Agreement

    Memorandum of settlement signed

  4. 4Implementation

    Communicating and following the agreement

  5. 5Administration and review

    Interpretation and grievance handling

  • Principles for management: good faith, avoid unfair labour practices, clear authority to negotiate, honour commitments.
  • Principles for unions: realistic demands, avoid violence, discipline among members, consider the firm's capacity.
  • Contents of agreements: wages and DA, bonus, working hours, leave, promotions, transfers, welfare, grievance procedure, duration of agreement.
3

Topic 3

Labour–management cooperation in India

  • Bipartite bodies: works committees (Industrial Disputes Act — 100+ workers), joint management councils, shop councils.
  • Tripartite bodies: Indian Labour Conference and Standing Labour Committee (Government, employers, workers), industrial committees, wage boards.
  • Code of Discipline (1958): voluntary code for employers and unions — no strikes/lockouts without notice, use of grievance machinery, no coercion.
  • Examples of cooperation: Tata Steel's joint consultation since 1956; Maruti's productivity-linked wage settlements; NTPC's participative forums.
  • Barriers: mistrust, inter-union rivalry, political interference, managerial reluctance to share power.
4

Topic 4

Grievances: causes and effects

A grievance is any discontent or dissatisfaction, whether expressed or not, valid or not, arising out of anything connected with the company that an employee thinks is unfair (Beach).

ClassificationCauses of grievances
Grievances

  • Economic

    Wages, incentives, overtime, bonus

  • Working conditions

    Safety, tools, rest rooms, shifts

  • Supervision

    Favouritism, rude behaviour, unfair discipline

  • Organisational

    Promotions, transfers, seniority, job security

  • Personal

    Maladjustment, family problems

  • Effects: low morale, absenteeism, reduced productivity, indiscipline, high turnover, accidents, collective disputes and strikes.
5

Topic 5

Negotiation, collective settlements and grievance redressal

  • Negotiation is the give-and-take process of reaching agreement; skills — preparation, listening, BATNA, creative options, maintaining relationships.
  • Collective settlements: bipartite settlements (signed by employer and union) and settlements arrived at in conciliation (binding on all workers under the Industrial Disputes Act/IR Code).

Grievance redressal procedure

ProcessModel grievance procedure (Indian Labour Conference, 1958)
  1. 1Step 1

    Employee presents grievance to the immediate supervisor — reply within 48 hours

  2. 2Step 2

    To the departmental head — reply within 3 days

  3. 3Step 3

    Grievance committee (management and union representatives) — 7 days

  4. 4Step 4

    Appeal to top management — 7 days

  5. 5Step 5

    Voluntary arbitration

  • IR Code, 2020: every establishment with 20 or more workers must have a Grievance Redressal Committee (up to 10 members, equal representation, a woman member); resolve within 30 days.
  • Principles: prompt handling, fair and impartial, confidentiality, written records, follow-up.

Exam tip

Write the five-step procedure with time limits — it is a scoring point.

Key terms

Collective bargaining
Negotiation between employers and unions on employment terms
Productivity bargaining
Linking wage increases to productivity gains
Code of Discipline
1958 voluntary code for employers and unions
Grievance
An employee's dissatisfaction with something perceived as unfair
Grievance Redressal Committee
Mandatory committee for establishments with 20+ workers under the IR Code

Quick revision

  • Collective bargaining: bipartite, continuous; types — conjunctive, cooperative, integrative.
  • Process: preparation → negotiation → agreement → implementation → review.
  • Cooperation: works committees, JMCs, Indian Labour Conference, Code of Discipline.
  • Grievance causes: wages, conditions, supervision, promotions.
  • Procedure: supervisor → department head → committee → management → arbitration.

Important exam questions

Practice questions written to the PTU exam pattern for this unit's syllabus: short answers (Section A style) and long answers (Sections B and C style).

Short-answer questions

  1. Q1.Define collective bargaining.
  2. Q2.What is productivity bargaining?
  3. Q3.State the prerequisites for collective bargaining.
  4. Q4.What is a works committee?
  5. Q5.Define grievance.
  6. Q6.State the steps in the model grievance procedure.

Long-answer questions

  1. Q1.Explain the concept, types and prerequisites of collective bargaining.
  2. Q2.Explain the process and principles of collective bargaining.
  3. Q3.Discuss labour–management cooperation in India.
  4. Q4.Explain the causes of grievances and the grievance redressal procedure.

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