Changing workforce

NAME: Anita Kumari

ROLL NO.: 12MBA05568

SEM: MBA (4th SEM)

CHANGING WORKFORCE

Their aspirations and expectations

Jamshedpur Women’s College

CHANGING WORKFORCETheir aspirations and expectations

CONTENT

Pg. No.

Introduction to the topic 1-3 Changing workforce Reason behind change Change in the behavior of workforceFirms point of view 4-5 Change in concepts of companies Reason behind change in concepts of companiesEssence of changing workforce 6-12 Essence of changing workforce Trade union Contract laborIR Scenario 13-15 Industrial relations Concerning areas of IRConclusion 16-17

INTRODUCTION TO THE TOPIC

CHANGING WORKFORCE

INTRODUCTION

The Indian economy is volatile. Organisations are greatly influenced by changes taking place in internal as well as external environment, and as a part, workforce are also changing. They want better salaries, better working condition and defined career opportunities.

The needs of the present day workforce have changed. It has transformed from collectivistic to individualistic in nature. There is also change in aspirations and expectation of the workers. The necessity of workers to have access to and the right to knowledge ,culture and education is more imperative than ever before.

REASON BEHIND CHANGE

In the past, when one wanted to describe the demographic and social characteristics of the work force and the career patterns of its members, it was common to divide individuals into two categories: managers, or “salaried”, and workers, or “hourly” employees. The laws governing employment practices still make this distinction, as salaried employees are “exempt” from much of the wage-and-hour legislation that governs the rights of “nonexempt” hourly employees. However, increasing diversity in both the characteristics of the labour force and the organization of work have made these categories less helpful.

These circumstances, introduced new legal issues and new regulations to the workplace. As per demands for labour continue to grow.As regard to new jobs; most of the new jobs are created not in the large manufacturing firms but in the service sector, especially health services, business services, social services management, and engineering. The majority of these new jobs will be created by small rather than large firms. Furthermore, the educational requirements of the “typical” job are expected to continue to increase.

Taken together, these trends worry many industrial relations personnel experts and managers, who fear a mismatch developing between the characteristics of future entrants to the labour force and the types of skills that will be in high demand. If this is true, considerable efforts will be required to coordinate the two. This in turn implies that individuals will need to engage in lifelong learning, training, and retraining and that firm will need to increase their training investment. The changing nature of the labour force further implies an increase in opportunities for women, minorities, and immigrants.

CHANGE IN THE BEHAVIOR OF WORKFORCE

The demographic of the workforce is currently changing. This is due to a number of factors such as an aging population, labour shortages and immigration. Another significant factor that has changed the workforce is the changes in the attitudes of workers; with the much debated discussion regarding the different generation. Changes in the workforce mean that employers may need to adapt their recruitment, training and management processes. An example of this is that there are currently a large number of older people either currently employed or seeking employment.

Where employers may have previously looked to younger people as a source of recruits, they may now have to broaden their view to find what a wider range of people have to offer. Many of these people may not have changed jobs in a significant period of time and may require extra training to bring their skills up to date.

The expectations behind change in the behavior of workforce:

Better salary Better working conditionsA defined career growthEducation Technological enhancement

FIRMS POINT OF VIEW

CHANGE IN CONCEPTS OF COMPANIES

To meet the current requirements both employer and employee should walk together. Employers need to understand the changing aspirations of workforce, and must manage the no-union or co-operative union model throughemployee engagement, including communication, employee care, psychological contract, empowerment, employee involvement, fair treatment etc.

To be successful these responsibilities must be fulfilled by managers/ management. Their attitude towards the workers has a direct bearing on the workers perception, and organizational justice. Organisation needs to be truly driven by knowledge to meet the aspirations of the employee.

To fulfill above requirements nowadays the companies also moved from the concept of 8 hours to efficiency and productivity, hiring soft skill and emotionally intelligent personnel for employee care and grievance management.

REASON BEHIND CHANGE IN CONCEPTS OF COMPANIES

The role of management would be to understand the changing demands are due to changing needs and try to maintain a productive workforce.

Companies are changing to meet:

Productivity and quality.Generate values.To meet employee aspirations and interest.Employee engagement and empowerment.To achieve objectives, individual as well as collective, etc.

ESSENCE OF CHANGING WORKFORCE

ESSENCE OF CHANGING WORKFORCE

The change and upgraded mindset of workers effected several organisational factors .The factors mostly influenced by the blow of change, are:

Trade union Contract labour

TRADE UNION

Introduction

Trade unions are a major component of the modern industrial relationship system. A Trade union is an organization 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.

Globally, two distinct paradigms are in Industrial Relations; neo-unitarism (absence of union) and neo- pluralism ( co-operative unionism).Those management which do not understand the contemporary issues of workplace dynamics have had serious industrial unrest because employee will always find trade unions relevant to pursue their collectieive interest.

However, trade unions try to develop close working relationships with employers. This can sometimes take the form of a partnership agreement between the employer and the trade union which identifies their common interests and objectives.

Functions and Roles of Trade Union

Trade unions are a legitimate system for organizing workers to voice their rights and grievances. Responsible unions play an important role in maintaining cordial relations between management and labour. However, irrespective of Trade union’s political affiliations, their generic functions may be categorized as follows:

Primary FunctionsNegotiate agreements with employers on pay and conditionsDiscuss major changes to the workplace such as large scale redundancyDiscuss their members; concerns with employers

Accompany their members in disciplinary and grievance meetingsProvide their members with legal and financial adviceProvide education facilities and certain consumer benefits such as discounted insurance

Value Addition and New FunctionCommunicationWelfare activitiesEducation

Joining A Trade Union

Some workers join a trade union because they believe that a union can:

negotiate better paynegotiate better working conditions, like more holidays or improved health and safetyprovide training for new skillsgive general advice and support

Union members have the right to be accompanied to a discipline or grievance hearing by a trade union representative (although trade unions are not compelled to provide this). All employees, regardless of whether they are union members or not, are entitled to be accompanied by a work colleague.

Recognized unions also have rights to consultation where redundancies or a transfer of business are proposed. There is a regular subscription cost for union membership and

different rates may apply to trainees and part-timers. Unions will not normally help with problems which pre-date membership.

Trade Union-Related Rights

The law gives the right to join a trade union wherever one works. This right applies whether a union has been recognised or not. Worker is protected from being disadvantaged for being a union member. Specifically trade union membership is an unlawful reason for:

Refusing employmentDismissing Selecting for redundancy

Trade Union Activities

When a union is recognized by an employer, members have the right to time off at an appropriate time to take part in trade union activities. These may include:

Voting in ballots on industrial actionVoting in union electionsMeeting to discuss urgent mattersAttending the annual conference

CONTRACT LABORContract labour, the labour of workers whose freedom is restricted by the terms of a contractual relation and by laws that make such arrangements permissible and enforceable. The essence of the contract labourer’s obligation is his surrender for a specified period of the freedom to quit his work and his employer. Other stipulations cover such matters as repayment of the costs of transportation, housing, training, and

other expenses.

Contract labour has been based upon conditions of poverty and upon political and religious intolerance, and it is often expressed in penal codes. Historically, deception, kidnapping, and coercion have been used to obtain contract laborers, with contractual terms often reflecting the disadvantageous position of the laborer. Contract labour still carries implications of compulsion and unfairness, and conditions can approach slavery in their severity.

Indentured labour, one form of contract labour, was common in North America in colonial times. Its subjects were western European (mainly British) males and females. Some of the contracts were similar to apprenticeships, while the terms of others were harsh—usually imposed on criminals whose sentences were commuted if they agreed to colonial indenture. This practice is also known as indentured servitude.

Contract labour: a problem or a solution?

Abraham Lincoln once said “Labour is prior to, and independent of capital. Capital is only the fruit of labour, and could never have existed if labour had not first existed. Labour is the superior of capital, and deserves much higher consideration”. Though the words from Lincoln have lost their true meaning in the way that most organizations operate today, they

still hold good for any business to be successful in the long run. The challenges of modern business forced the organizations to part ways with the traditional system of direct employment and use some alternate means of getting work done. While some organizations went for outsourcing, others relied on contract labours as a solution to their problems.

Before discussing the challenges that paved the way for contract labours, let us first know what exactly contract labour is? contactlabour is “ a person hired on contract to perform certain task”, the Indian Labour Law gives a much more extensive definition. It defines contract labour as a person who is hired by the principal employer (the manager of a firm)

through a contractor in connection with the work of an organization. The manager goes into an agreement with the contractor for the number of contract labours required by him and in return pays to the contractor the amount agreed upon.

Finally, the contractor who is the employer of contract labours pays them the salaries for the services rendered. In India, the act which governs the practice of contract labour is the Contract Labour (Regulation and Abolition) Act 1970. According to the act, both the principal employer and the contractor have to take prior permissions from the labour department before engaging the contract labour.

Having understood what contract labour is, let us now understand why contract labour has prevailed so much. Cut throat competition, globalization and economic uncertainty are some of the main reasons which made contract labour an important part of every organization. The need to deliver the products & services at lower costs has led to an increase in employment of contractual workers who are paid almost a quarter of what a permanent employee gets in an organization. Companies often pay them only the minimum wages for which they are bound by statutory obligation whereas permanent employees enjoy greater packages and benefits. And this indeed becomes one of the major reasons for labour unrest. Today, companies face a lot of fluctuation in the demand for the goods and services due to increased uncertainty of the economic conditions. And inflexible nature of Indian labour laws makes the sustenance of companies even difficult, since it is almost impossible to retrench permanent workers legally at short notice and this force companies to use contract labour.

Although contract labour is one of the chief solutions to increased competition and has become essential for the survival of a company, contract labour comes with its own statutory obligations which if not met may lead to escalated problems in future for an

organization. On the contrary, abiding by the Contract Labour (Regulation and Abolition) Act could be the solution to the legal problems which company may otherwise have to face in the long run. Whether you see the history of cases or the recent incidents that have arose in relation to the contract labours in India, you would find one thing very common: most of the problems arising out of contractual labours have been either due to the non-compliance to the labour laws or due to wrong interpretation and implementation of the labour laws by the organizations.

The recent violence at Maruti, Manesar which took the country by storm and where in an unfortunate incident an HR General Manager lost his life is one of the best examples of the consequences which the company may have to face in case of non- compliance to the labour laws. It was not only the loss to mankind, but also the defeat of the very purpose of labour laws. Also another very important reason to be looked into is the archaic nature of labour laws in India which make things even more difficult. The fines imposed under labour laws are not sufficiently deterrent as the quantum of fines has not been revised over the time. So many a times, it becomes more profitable for the organizations to violate the labour laws and pay the penalties imposed, rather than to abide by them and to take the pain of implementing them in their organization.

Looking at the recent incidents of contract labour unrest – be it the violence at Maruti, Manesar; continued labour unrest at Hyundai, Chennai or the violence at Honda, Gudgeon; the Government is keen to amend the Contract Labour (Regulation and Abolition) Act, 1970 so as to make it more welcoming for the contract labours. The intended change aims not only to bring the salaries of contract labours at par with the permanent employees, but also to give all other benefits which a permanent employee enjoys except assured job security. But this move may kill the very purpose of engaging contract labour, depriving companies the benefits of cheap and timely labour. And increasing the wages of the contract labours may not be the only solution to all the grim problems. Organizations need to make sure that they understand the laws fully and abide by it in order to get full advantage of the contract labours. In addition, the government needs to ensure that not only the laws are revised from time to time, but are also explained to the organizations in detail so as to avoid any unfortunate situations & incidents in the future

IR SCENARIO

INDUSTRIAL RELATIONS

INTRODUCTIONIn modern days, Industrial work has become quite complex and different from it was in earlier ttimes.With the advent of modern industrialization automation organizations have undergone a major scale in terms of activities.

Industrial relations are essentially human relations, relation between workers and management.No organization can operate entirely without human effort and IR is responsible for fully utilizing a corporations human resources.

“Industrial relations include securing effective and willing co-operation from employee and reducing conflict between employers and workers and their representatives, the Trade Union.”

National Commission on Labor (NCL)

The National Commission on Labor (NCL) also emphasize on the same concept. According to NCL, industrial relations affect not merely the interests of the two participants- labor and management, but also the economic and social goals to which the State addresses itself. To regulate these relations in socially desirable channels is a function, which the State is in the best position to perform.

In fact, industrial relation encompasses all such factors that influence behavior of people at work. A few such important factors are below:

Characters: It aims to study the role of workers unions and employers’ federations officials, shop stewards, industrial relations officers/ manager, mediator/conciliators / arbitrator, judges of labor court, tribunal etc.

Institution: It includes government, employers, trade unions, union federations or associations, government bodies, labor courts, tribunals and other organizations which have direct or indirect impact on the industrial relations systems.

Methods: Methods focus on collective bargaining, workers’ participation in the industrial relations schemes, discipline procedure, grievance redressal machinery, dispute settlements machinery working of closed shops, union reorganization, organizations of

protests through methods like revisions of existing rules, regulations, policies, procedures, hearing of labor courts, tribunals etc.

Contents: It includes matter pertaining to employment conditions like pay, hours of works, leave with wages, health, and safety disciplinary actions, lay-off, dismissals retirements etc., laws relating to such activities, regulations governing labor welfare, social security, industrial relations, issues concerning with workers’ participation in management, collective bargaining, etc.

CONCERNING AREAS OF IR

IR covers the following areas:

Collective bargainingRole of management, unions and governmentMachinery for resolution of industrial disputeLabour legislationIR training

FACTORS EFFECTING IR SCENARIO

Relationship between management and workersProtect workers interest and improve their economic condition

CONCLUSION

CONCLUSION

“Extreme care for employees while nurturing & strengthening

of the core values of workers.”

We are living in a turbulent time. The consumer behavior is changing. That the need of the present day workforce has changed. There is a change in aspiration and expectation of the workers. Today’s younger workforce displays several new features. It is talented, educated, more demanding for career opportunities and rewards as compared to older generation. They respect diverse opinion and personalities. Aspirations of the working population and the nature of the economy offer an answer to today’s fraught industrial relations.

“To meet the need of workers and industrial peace & growth management should start thinking about individualism.”