UNIT -3

Trade Union

Trade Union

Section 2(h) of the Trade Unions Act, 1926 has defined a trade union as “Any combination, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers, or between workmen and workmen, or between employers and employers, or for imposing restrictive conditions on the conduct of any trade or business, and includes any federation of two or more trade unions.”

Then this definition talks about three relationships. They are relationship between the:

• Workmen and workmen
• Workmen and employers
• Employers and employers

Trade Union Act, 1926

• Formation and Registration:- 7 members can form a trade union and may apply to the registrar of Trade Unions for registration.

• Application accompanied by Schedule:-I, II and bye law and a resolution authorizing 7 members of the union to make an application for registration of the union Registration Fees Rs. 500/

• After making necessary enquiry the registrar it issues a registration certificate:-

It may be cancelled or withdrawn on the application of a trade union in Form-D or If the registrar is satisfied that the certificate is obtained by fraud or the trade union has ceased to exist or wilfully and after notice from the registrar contravened any provisions of the Act.

• Appeal person aggrieved:- by any order of the registrar may appeal within 2 months to the Civil Court not inferior to the court of Additional or Assistant Principal Civil Court

• Change of Name :- any registered trade union may with the consent of not less than 2/3 of its total members may make application in Form H, for the change of its name.

• Annual Returns:- Every union shall send annual returns to the registrar in triplicate on or before the 1st day of June of the year succeeding the calendar year in Form-L in case of individual trade unions and in Form- LL in case of federation of trade unions

AMALGAMATION (SECTION 24):

Any two or more registered trade unions may be amalgamated together as one trade union with or without dissolution or division of the funds of such trade unions. Such amalgamation is allowed if:

 The votes of at least half of the members of each and every such

Trade union entitled to vote are recorded out of which at least 60percent of the votes recorded are in favour of the proposal of amalgamation.

 Notice in writing of every amalgamation signed by the secretary

And by seven members of each and every such trade union, whichis a party there to.

Such notice shall be sent to the Registrar of such state in which the head office of the amalgamated trade union is situated

Obligations of Registered Trade Unions

• The general funds of a registered trade union should be spent only for the objects specified.
• The account books and membership register of the union should be kept open for inspection by any of its office-bearers.
• A copy of every alteration made in the rules of the union should be sent to the Registrar with in 15 days of making the alteration.
• An annual statement of receipts and expenditure and assets and liabilities of the union for the year ending31st December in a prescribed form and duly audited be sent to the Registrar within the prescribed time.

3.1 Nature of trade union

• It is an organisation formed by employees or workers.
• It is formed on a continuous basis. It is a permanent body and not a casual or temporary one.
• It is formed to protect and promote all kinds of interests –economic, political and social-of its members. The dominant interest with which a union is concerned is, however, economic.
• It includes federations of trade unions also.
• It achieves its objectives through collective action and group effort

Objective of trade union

• To improve the economic lot of employees by securing for them better wages.
• To secure better working conditions for the workers.
• To secure bonus for the employees from the profit of the concern.
• To resist schemes of the management which reduce employment, e.g., rationalisation and automation.
• To secure welfare of employees through group schemes which give benefit to every employee.
• To protect the interests of employees by taking active participation in the management.
• To secure social welfare of the employees.
• To secure organisational stability, growth, and leadership.

Function of trade union

Trade unions perform 5 types of functions:

1. Militant Functions. One set of activities performed by trade unions leads to the betterment of the position of their members in relation to their employment. The aim of such activities is to ensure adequate wages, secure better conditions of work and employment, get better treatment from employers, etc. When the unions fail to accomplish these aims by the method of collective bargaining and negotiations, they adopt an approach and put up a fight with the management in the form of so-slow, strike, boycott, gherao, etc. Hence, these functions of the trade unions are known as militant or fighting functions.

2. Fraternal Functions. Another set of activities performed by trade unions aims at rendering help to its members in times of need and improving their efficiency. Trade unions try to foster a spirit of cooperation and promote friendly relations and diffuse education and culture among their members. They also arrange for legal assistance to its members, if necessary. Besides, these, they undertake many welfare measures for their members, e.g., school for the education of children, library, reading-rooms, in-door and out-door games, and other recreational facilities. Some trade unions even undertake publication of some magazine or journal. These activities, which may be called fraternal functions, depend on the availability of funds, which the unions raise by subscription from members and donations from outsiders, and also on their competent and enlightened leadership.

3. Intra-mural activities. These consist of those functions of the unions that lead to the betterment of employment conditions such as ensuring adequate wages and salaries, etc. for which the methods adopted may be collective bargaining, negotiations, strikes, etc.

4. Extra-mural activities. These activities help the employees to maintain and improve their efficiency or productivity, e.g., measures intended to foster a spirit of cooperation, promote friendly relations, and diffuse education among members and various other types of welfare measures.

5. Political activities. Modern trade unions also take up political activities to achieve their objectives. Such activities may be related to the formation of a political party or those reflecting an attempt to seek influence on public policy relating to matters connected with the interests of working class.

Criticism of Trade Union

• Lack of education makes the workers narrow-minded, and prevents them from taking long-term views. Thus, anything, which does not result in an immediate reward, becomes unattractive to them. This attitude is responsible for many strikes and lock-outs in industrial concerns.

• Trade unions may not welcome rationalization and improved methods of production for the fear that some of the workers will be put out of work. Therefore, they resort to go slow policy that retards industrial progress.

• When labour unions strike because of illogical grounds, incalculable losses occur to producers, community and the nation. These are harmful to the workers also. They suffer because of the loss of wages.

• They create artificial scarcity of labour by demanding that only union personnel should be employed.

• By undue insistence on the payment of standard rates of wages, they have only levelled down the earnings of the efficient workers

Motivation to join Trade Union

• Greater Bargaining Power. The individual employee possesses very little bargaining power as compared to that of his employer. If he is not satisfied with the wage and other conditions of employment, he can leave the job.

• Make their Voices Heard. The desire for self-expression is a fundamental human drive for most people. Don’t you agree with that? All of us wish to share our feelings, ideas and opinions with others. Similarly, the workers also want the management to listen to them.

• Minimise Discrimination. The decisions regarding pay, work, transfer, promotion, etc. are highly subjective in nature. I may rate you very differently as compared to your marketing teacher! Similarly, the personal relationships existing between the supervisor and each of his subordinates may influence the management. Thus, there are chances of favouritisms and discriminations.

• Sense of Security. The employees may join the unions because of their belief that it is an effective way to secure adequate protection from various types of hazards and income insecurity such as accident, injury, illness, unemployment, etc. The trade union secure retirement benefits of the workers and compel the management to invest in welfare services for the benefit of the workers.

• Sense of Participation. The employees can participate in management of matters affecting their interests only if they join trade unions. They can influence the decisions that are taken as a result of collective bargaining between the union and the management.

• Sense of Belongingness. Many employees join a union because their co-workers are the members of the union. At times, an employee joins a union under group pressure; if he does not, he often has a very difficult time at work. On the other hand, those who are members of a union feel that they gain respect in the eyes of their fellow workers. They can also discuss their problem with’ the trade union leaders.

Structure of Trade Union

• Plant level Unions: The first level in the structure from below is the plant level union. This comprises the unions in one organisation or factory. Please note that only seven members are required to form a union. This has lead to multiple unions in one factory. (We will discuss the details of this aspect in the problems faced by unions in India).

• Local Level federations. This is the second level in the structure from below. The local trade union federation holds together the plant level unions at the local level in a particular craft and industry. These local level federations might be affiliated to either some regional level or national level federation or these may be independent.

• Regional level federations. These are the organisations of all the constituent unions in a particular state or region.

• National federations. These are national level bodies to which plant level unions, local unions or regional level unions may get affiliated. These are the apex bodies at the top of the structure. They act as coordinating bodies. These national federations may have their own regional or state level coordinating bodies to which the plant level unions may get affiliated.

Liabilities

Disbursement of the trade union’s funds: The registered union maintains two types of funds:

 General fund

 Political fund

The political funds of a registered trade union shall be used for the promotion of civil and political interests of its members or in furtherance of any of the objects specified below:

 The holding of any meeting or the distribution of any literature or documents in support of any such candidate.

 The registration of the electors on the selection of a candidate for election to any legislative body constituted under the constitution of any local authority.

 The holding of political meetings of any kind or the distribution of political literature or political documents of any kind.

Disqualification of office bearer of trade union

A person shall be disqualified for being chosen as or being a member or an executive or an office bearer of a trade union under the following circumstances:

· If he has not attained the age of 18 years.

· If he has been convicted by a Court in India to any offence involving moral turpitude and sentenced to imprisonment by a Court in India, unless a period of 5 years has been elapsed since his release.

However, any person shall not be disqualified as an office bearer if the

· Offence does not involve moral turpitude.

· Punishment is only pecuniary.

· Disqualification is only for a temporary purpose

Rights of a trade union

• It is a corporate body: The registered trade union is a corporate body under section 13 of the Act.
• It enjoys immunity (exemption) from criminal conspiracies
• Section 17 of the Trade Union Act gives immunity to members and office bearers of registered trade unions from criminal conspiracy in connection with trade disputes. The union can keep separate fund for political purposes.
• An agreement between the members of a registered trade union not to accept employment is valid (not void being agreement in restraint of trade).

• The union has a right to amalgamate to form a larger union.

• Members of the union have a right to inspect books.

• Any person who has attained the age of 15 years can become the member of the union

• The union can enforce the performance of contracts.

Problems and weakness of Trade Union

• Uneven Growth. The trade unionism in India is characterised by uneven growth, both industry-wise and area-wise. Trade unions are popular in big industries and the degree of unionisation varies widely from industry to industry. Besides, trade union activities are concentrated in a few states and in bigger industrial centres mainly due to concentration of industries in those places.

• Limited Membership. The number of trade unions in India has increased considerably. But this has been followed by the declining membership per union.

• Multiplicity of Unions. There exist several trade unions in the same establishment. The multiplicity of unions is the result of outside leadership and labour laws. The law permits and gives sanctity to small unions. Any seven persons can form a union under the Trade Unions Act, 1926. This Act confers rights on such a union. It is allowed under the Act to raise disputes, file suits, go to conciliation and even bargain with employers. Therefore, small sections of workers are encouraged to form separate Unions. There is no restriction on the number of unions to be registered in one establishment.

• Outside Leadership. Trade unions in India are led largely by people who themselves are not workers. These outsiders are politicians, intellectuals and professionals having no experience of work in industry. Outsiders continue to dominate the trade unions to advance their personal interests.

• Financial Problems. The financial position of the trade unions is weak because their average yearly income is very low and inadequate. The subscription rates are very low. Under conditions of multiplicity of unions, a union interested in increasing its membership figures keep the subscription rate unduly low. As a result, the funds with the unions are inadequate and they cannot undertake welfare programmes for their members. Another reason for the weak financial position of union is that large amounts of subscription dues remain unpaid by the workers. Besides this, unions do not have proper staff and organisation to collect subscriptions.

• Indifferent Attitude of Workers. In India, a large number of workers have not joined any union. Moreover, all the members of the trade unions do not show interest in their affairs. The attendance at the general meetings of the unions is very low. Under such circumstance, trade unionism cannot be expected to make much progress.

Suggestions for the development of Trade Union

• One Union in One Industry: Multiplicity of unions in the same plant leads to inter-union rivalry that ultimately cuts at the root of the trade union movement. It weakens the power for collective bargaining and reduces the effectiveness of workers in securing their legitimate rights. Therefore, there should be only one union in one industry.

• Paid Union Officials: Generally, the trade unions avail the services of the honorary workers due to lack of funds. The practice should be stopped because honorary office bearers cannot do full justice to the task entrusted to them because of lack of time at their disposal. Suppose that you are asked to do something in the office, which requires a lot of responsibility. You are not offered anything in return. Of course, the motivational levels will come down unless and until you are a very passionate or a committed person. The same applies to the officials of the unions. Therefore, paid union officials should be employed who are persons of proven integrity and who are able to evaluate the demands of workers so that they may negotiate with employers on equal footing.

• Development of Leadership from Within: It is of crucial importance that trade unions are managed by the workers, and not by outsiders. Leadership should be developed from within the rank and file of the workers.

• Recognition of Trade Unions. Till recently, the employers refused recognition to the trade unions either on the basis that unions consisted of only a minority of employees or two or more unions existed

3.2 Role of trade union in Development in India

In India the Trade Union movement is generally divided on political lines. According to provisional statistics from the Ministry of Labour, trade unions had a combined membership of 50,97,366 in 2010. As of 2008, there are 14 Central Trade Union Organisations (CTUO) recognised by the Ministry of Labour. Trade Unions are voluntary organization of Workers as well as Employers formed to protect and promote the interest of their members. They are the most suitable organizations for balancing and improving the relations between the employer and the employees. Trade Unions have made headway due to rapid industrial development. The workers come together to maintain and improve their bargaining power on wages and working conditions.

The first organized Trade Union in Indian amed as the Madras Labour Union was formed in the year 1918. From the beginning itself, Trade Unions were not confined to workers alone. From19thCentury itself there were Employer’s associations in the form of Chamber of Commerce, Industrial Associations etc. to protect and promote the interests of their members in a concerted manner. After independence, expansion of industrial activity and grouping worker’s Trade Unions acted as a spur for strengthening and expansion of employers’ organization. In industrially advanced countries, trade unionism has made a great impact on the social, political and economic life.

India, being an agricultural country, trade unionism is restricted to industrial areas and it is still in a stage of growth. The earliest known trade unions in India were the Bombay Millhand's Association formed in 1890, the Amalgamated Society of railway servants of India and Burma formed in 1897, Printers' Union formed in Calcutta in 1905, the Bombay Postal Union which was formed in 1907, the Kamgar Hitwardhak Sabha Bombay formed in 1910. Trade unions are a major component of the system of modern industrial relations in any nation, each having their own set of objectives or goals to achieve according to their constitution and each having its own strategy to reach those goals.

A trade union is an organisation formed by workers to protect their interests and improve their working conditions, among other goals. It is a continuous association of wage earners for the purpose of maintaining and improving working conditions (Dankert, 1948). In developing countries, the right to form a union and bargain collectively protects workers from exploitative and abusive conditions at work and puts pressure on employers to share productivity gains with their employees. Protection of basic worker and human rights in developing nations thus necessitates unionisation so that the working population can reap the benefits of economic growth.

Major Trade Union Organizations in India

• AITUC (All India Trade Union Congress)
• Centre of Indian Trade Unions (CITU)
• Hind Mazdoor Sabha
• All India Council of Central Trade Unions
• All India United Trade Union Centre
• United Trade Union Centre
• All India federations of banks, insurance, railways, defence, telecom, airline and airports.
• Centre of Indian Trade Unions -president M.K. Pandhe

Emergence and Development of TU in India

• First cotton mill in India was established in 1851 in Bombay and the first jute mill in 1855 in Bengal
• First Factory Commission was appointed in Bombay in the year 1875
• First Factories Act was passed in 1881

 Was disappointing

 Second Factory Commission was appointed in 1884

 Mr. Lokhandey organised a conference of workers in Bombay and drew up a memorandum signed by some 5,300 to present to the Commission

 This was the first organized effort by workers in India

 However, no roll or membership, no funds and no rules.

• Printers’ Union, Calcutta - 1905
• Kamgar Hitwardhak Sabha - 1910
• Social Service League – 1910
• The amalgamated society of railway servants of India and Burma

• Were essentially labour welfare organisations and may hardly be regarded as modern trade unions
• Marjory called as Social welfare period

Present Central Trade Union Organizations

 All India Trade Union Congress (AITUC)

 Bharatiya Mazdoor Sangh (BMS)

 Centre of Indian Trade Unions (CITU)

 Hind Mazdoor Kisan Panchayat (HMKP)

 Hind Mazdoor Sabha (HMS)

 Indian Federation of Free Trade Unions (IFFTU)

 Indian National Trade Union Congress (INTUC)

 National Front of Indian Trade Unions (NFITU)

 National Labour Organization (NLO)

 Trade Unions Co-ordination Centre (TUCC)

 United Trade Union Congress (UTUC)

 United Trade Union Congress - Lenin Sarani (UTUC - LS)

Some Figures of Trade Unions

Role of trade unions in India

Trade unions in India are governed by the Trade Unions Act of 1926, which is the main legislation that provides various rules, regulations and controlling mechanisoms related trade unions. The contribution of trade unions to the development of the labour movement in South Asia, as well as at the global level, is well recognised. Attention has, however, remained focused on the formal sector.

Unionisation is almost non-existent in the small and informal sector. The union structure in India is rather well-developed despite the fact that only 20% of registered unions have sought affiliation to any of the other of the 13th Central Trade Union Organizations (CTUO). The extent of unionisation in the country is as high as 90% within the public sector, while, surprisingly, it is much lower in the

Private sector. The changing role of the government in India and the introduction of new technology have both radically altered the employment scenario. Shifts in job opportunities from the formal to the informal sector and increasingemployment opportunities for educated and skilled workers have necessitated a paradigm shift in the approach and function of unions. Indian trade unions have,

However, been slow in reacting to these changes. This, in turn, has resulted in the loss of membership within these unions.

Statistics related to labour, as released bythe Government of India, indicate that the membership in unions that submitted returns to the appropriate authority under the Trade Union Act of 1926 was less than 2% of the total labour force in 1990, which, in turn, constituted about 30% of the organised sector workforce. Workers have also been seen to move to alternate forms of trade unions.

The organizational pattern of a trade union federation is usually a three tier structure, comprised of national level federations, industry level unions (eg. Textile Labour Association Ahmedabad) and unit level unions, withindependent local unions centered around a particular plant.

Growth And Status of Trade Unions in India

Latest available information for trade unions pertains to year 2008. As per the information available , number of registered trade unions have increased by about 31% in the ten years duration i.e. 1999-2008 to 84,642 registered unions. However, compared to 2008 the number declined by about 12 per cent and the average membership per union declined from 1063 in 2007 to 986 in 2008. Out of the registered trade unions , only 9709 unions( 11.47 per cent ) have submitted returns during 2008 and amongst the States/UT’s, the information has been furnished only by 13 states/UT’s .

On the basis of available information , Tamil Nadu accounted for the largest number of registered trade unions (8,793) followed by Rajasthan (4,593). Out of the total of 27,137 registered unions in the 13 states , as many as 27,063 unions (99.73 percent) were Workers Unions and remaining 74 (0.27 percent) were Employer Unions. Workers Union : Out of 27,063 Workers Unions, 88.76 percent were State Unions and remaining 11.24 percent were Central Unions. State Unions are those unions, whose activities/objectives are confined to the boundaries of the State, while Central Unions have activities/objectives beyond a State boundary. During 2008, out of 27,063 registered workers unions, only 9702 unions (35.85 percent) had submitted the returns. The average membership per workers unions was 986 only.

Industrial Activity Wise Distribution of Workers Unions Submitting.  Returns: Out of the 9702 unions that submitted returns during 2008 , 3452 unions (about 40%) belonged to the manufacturing group , followed by ‘Other community, social and Personal Services Activities’ (1374 unions, 14 percent) & Transport Storage & Communication (1334, 14 per cent).

Income and Expenditure of Workers’ Unions. During 2008, total Income and Expenditure of all workers unions was Rs 113.81 Crore and Rs 80.99 Crore respectively. The Income and Expenditure of Workers Central Unions was Rs 44.79 Crore and Rs 24.10 Crore respectively. The remaining Income and Expenditure of Rs 69.02 Crore and Rs 56.89 Crore respectively pertained to State Unions. The highest income and expenditure of Central Unions and as well as for State Unions these were in Tamil Nadu. Employers Union : In 2008, out of 74 registered, Employers Unions, 7 unions (i.e. 9.46 percent) had submitted returns. All the employers, trade unions submitting returns were State Unions. These union had a membership of 6,924 persons, out of which only 1,012 (14.62percent) were women.

The average membership per employers union was 989. Highest number of Employers Unions submitting returns was 4 in ‘Manufacturing’ whereas Real Estate Renting & Business Activities had highest membership amongst those submitting returns.

Income and Expenditure of Employers Unions All the unions submitting returns were State Unions. Income and Expenditure of these unions was Rs 0.37 Crore and Rs 0.33 Crore respectively. Among Industries, maximum Income and Expenditure of Rs 0.29 Crore and Rs 0.29 Crore respectively was reported in industry group“Manufacturing” followed by “Real Estate, Renting and Business Activities”.

Source of Trade Union Statistics : The Rules Framed under the “Trade Unions Act,1926 impose obligation on the registered Trade Unions (Workers & Employers) to submit annual statutory return in the prescribed format to the Registrar of their respective States/ Union Territories. These State/U.T. Authoritiesin turn furnish the consolidated data in respect of the entire State/U.T. To theLabour Bureau. The Labour Bureau , Ministry of Labour & Employment, compilesand disseminates these statistics at All India level.

Key Takeaway

Trade union is relationship between the:

• Workmen and workmen
• Workmen and employers
• Employers and employers

Amalgamation (section 24):

Any two or more registered trade unions may be amalgamated together as one trade union with or without dissolution or division of the funds of such trade unions.

Major Trade Union Organizations in India

• AITUC (All India Trade Union Congress)
• Centre of Indian Trade Unions (CITU)
• Hind Mazdoor Sabha

Trade unions perform 5 types of functions:

1. Militant Functions.

2. Fraternal Functions.

3. Intra-mural activities.

4. Extra-mural activities.

5. Political activities.

Reference:

1. Labour Economics by G.P. Sinha

2. Labour Economics by T.N.B Bragoliwal