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Workers participation in management

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Why and how is WPM important in organizations

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Workers participation in management

  1. 1. Presented by:Pooja Bhayani – 05 Shruti Poddar – 24
  2. 2. WPM Worker’s participation is a system where workers and management share important information with each other and participate in decision taking.
  3. 3. • • • • WPM encompasses the following:- It provides scope for employees in decision-making of the organization. The participation may be at the shop level, departmental level or at the top level. The participation includes the willingness to share the responsibility of the organization by the workers. It is conducted through the mechanism of forums which provide for association of workers representatives.
  4. 4. Definition of WPM A system of communication and consultation, either formal or informal, by which employees of an organization are kept informed about the affairs of the undertaking and through which they express
  5. 5. Participation refers to the mental and emotional involvement of a person in a group situation which encourages him to contribute to group goals and share the responsibility of achievement.
  6. 6. Participation in Management gives the worker a sense of importance, pride and accomplishment; it gives him the freedom of opportunity for self-expression; a feeling of belongingness with the place of work and a sense of workmanship and creativity.
  7. 7. • • • • Objective To elevate worker’s status in industry. To promote democratic practice. Increase productivity with joint efforts. Promote cordial relations.
  8. 8. Importance of WPM • • • • • • Mutual understanding Higher productivity Industrial harmony Industrial democracy Less resistance to change Creativity & Innovation
  9. 9. Forms of participation • • • • • Consultative participation Informative participation Administrative participation Associative participation Decision / Decisive participation
  10. 10. 1. Consultative • • Involves a high degree of sharing of views of the members and giving them an opportunity to express their feelings. Members are consulted on matters such as:– Welfare amenities (work, health) – Adoption of New Technology – The problems emanating from it
  11. 11. 2. Information • It ensures that employees are able to receive information and express their views pertaining to the matters of:– General economic situation. – The state of market, production & sales programmes. – Organisation & general running of the undertaking. – The annual balance sheet & profit & loss account statement & connected
  12. 12. 3. Administrative • • • Involves a greater degree of sharing of authority and responsibility of the management functions. It ensures greater share of workers’ participation in discharge of managerial functions. Employees take part in decisions,
  13. 13. • Members are given little for autonomy in the exercise of administrative and supervisory powers with regard to – – Welfare measures – Supervision of safety measure – Operation of vocational training & apprenticeship schemes – Preparation of schedules of working hours, breaks, holidays
  14. 14. 4. Decision • • • • Highest form of participation. Maximum delegation of authority and responsibility of managerial function. Decisions mutually taken. Matters concerned are – – – – – Economic, Production Welfare Financial and Administrative policies
  15. 15. 5. Associative • • Extension of consultative participation Management here is under the moral obligation to accept and implement the unanimous(agreed) decisions of the employees.
  16. 16. Levels of Participation 1. 2. 3. 4. 5. 6. 7. 8. Collective Bargaining Works Committees Shop / Department Council Joint Councils Board Representations Workers Ownership of Enterprise Quality Circles Kaizen
  17. 17. 1. Collective Bargaining ILO has defined, "Collective bargaining as, negotiation a bout working conditions and terms of e mployment between an employer and a group of employees or one or more employee, organization with a view to reaching an agreement wherein the terms serve as a code of defining the rights and obligations of each party in
  18. 18. • • Collective :-because both the employer and the employee act as a group rather than as individuals. Bargaining :because the method of reaching an agreement involves proposals and counter proposals, offers and counter offers and other negotiations.
  19. 19. • Thus collective bargaining: – is a continuous process which aims at establishing stable relationships between the parties involved. – is a collective process in which representatives of both the management and employees participate. – not only involves the bargaining agree ment, but also involves the implement ation of such an agreement.
  20. 20. • Loopholes in Collective Bargaining The process of CB cannot be called WPM in its strongest sense as in reality; CB is based on the crude concept of exercising power for the benefit of one party. – WPM, on the other hand, brings both the parties together and develops appropriate mutual understanding and –
  21. 21. 2. Works Committees • • • Under the Industrial Disputes Act, 1947, every establishment employing 100 or more workers is required to constitute a works committee It consists of equal number of representatives from the employer and the employees. The main purpose of this committee is to provide measures for securing and preserving amity and good relations
  22. 22. Functions of Work Committee • Works committee deals with matters of day-to-day functioning at the shop floor level. Works committees are concerned with: – – – – Conditions of work such as ventilation, lighting and sanitation. Amenities such as drinking water, canteens, dining rooms, medical and health services. Educational and recreational activities. Safety measures, accident prevention mechanisms etc.
  23. 23. Loopholes in Works Committees • • • • Lack of competence and interest on the part of workers’ representatives. Employees consider it below their dignity and status to sit alongside blue-collar workers. Lack of feedback on performance of Works Committee. Undue delay and problems in
  24. 24. • • • 3. Shop / Department Council Government of India on the 30th of October 1975 announced a new scheme in WPM. In every Industrial establishment employing 500 or more workmen, the employer shall constitute a shop council. Shop council represents each department or a shop in a unit.
  25. 25. • • • • The employers’ representatives will be nominated by the management and must consist of persons within the establishment. The workers’ representatives will be from among the workers of the department or shop concerned. The total number of employees may not exceed 12. All decisions taken will be
  26. 26. Functions of Shop Council • • • • Assist management in achieving monthly production targets. Improve production and efficiency, including elimination of wastage of man power. Study absenteeism in the shop or department and recommend steps to reduce it. Suggest health, safety and welfare measures to be adopted for smooth functioning of staff.
  27. 27. 4. Joint Councils • • • • • The joint councils are constituted for the whole unit, in every Industrial Unit employing 500 or more workers. Only such persons who are actually engaged in the unit shall be the members of Joint Council. A joint council shall meet at least once in a quarter. The chief executive of the unit shall be the chairperson of the joint council. The vice-chairman of the joint council
  28. 28. • • • • It for a period of two years. The decisions will be binding on both parties and will be implemented within one month. In 1977 the above scheme was extended to the PSUs like commercial and service sector organizations employing 100 or more persons. The organizations include hotels, hospitals, railway and road transport, post and telegraph offices, state
  29. 29. Functions of Joint Council • • • • • • • • Fixation of production norms Work planning Achieving production targets Training Reward policy Creative suggestions Health Security
  30. 30. 5. Board Representation • • • • This would be the highest form of industrial democracy. The workers’ representative on the Board can play a useful role in safeguarding the interests of workers. The worker can serve as a guide and a control element. The worker can prevail top
  31. 31. • • • • Loopholes of Board Representation is Focus of workers’ representatives different from the focus of the remaining members of the Board The worker tends to become alienated from the workers. The worker may be less effective with the other members of the Board in dealing with employee matters. Due to the differences in the cultural ,educational backgrounds and behaviour, the employees’ representative may feel inferio r to the other members, and may feel
  32. 32. 6.Worker’s Ownership Of Enterprise This involves making the workers’ shareholders of the company by inducing them to buy equity shares. • In many cases, advances and financial assistance in the form of easy repayment options are extended to enable employees to buy equity shares. Examples of this method are available in the manufacturing as well as the service sector. • Advantage: Makes the workers committed to the job and to the organization. •
  33. 33. 7.Quality Circles(QC) • It consists of seven to ten people from the same work area who meet regularly to define, analyze, and solve quality and related problems in their area. • These circles require a lot of time and commitment on the part of members for regular meetings, analysis, brainstorming etc • Most QCs have a definite life cycle – one to three years. Few circles survive beyond this limit either because they loose steam or they face simple problems. • QCs can be an excellent bridge between
  34. 34. Advantages of QC • • • Employees become involved in decision-making, acquire communication and analytical skills and improve efficiency of the work place. Organization gets to enjoy higher savings-to-cost ratios. Chances of QC members to get promotions are enhanced
  35. 35. 8. Kaizen • • • It is also called as “Continuous Improvement” It is a policy of constantly introducing small incremental changes in a business in order to improve quality and/or efficiency. This approach assumes that employees are the best people to identify room for improvement, since they see the processes in action all the time.
  36. 36. Features of Kaizen • • • • • Improvements are based on many, small changes rather than the radical changes that might arise from Research and Development As the ideas come from the workers themselves, they are less likely to be radically different, and therefore easier to implement Small improvements are less likely to require major capital investment than major process changes The ideas come from the talents of the existing workforce, as opposed to using R&D, consultants or equipment – any of which could be very expensive All employees should continually be seeking
  37. 37. WPM in India • • In 1920 Mahatma Gandhi had suggested that workers contributed labour and brains, while shareholders contributed money to enterprise, and that both should, therefore share in its prosperity. The influence of Mahatma Gandhi bore fruit and for the first time Joint Consultation was adopted in the
  38. 38. • • • Workers’ participation in Management Bill, 1990 was introduced in Parliament which provided scope for upliftment of workers. The Industrial Policy Resolution had suggested that labour should be consulted in all matter concerning industrial production & works committees . The Joint Management Councils were established in 1950 which
  39. 39. • • • • • • Reasons for failure of WPM in India: Lack of initiative & interest. Ideological differences. Delay in implementation. Political unionism. Narrow scope of participative forum with limited issue. Not decisive participation.
  40. 40. • • • • • Employers resist the participation of workers. Dual roles of workers’ spokesman and a co-manager. “Born to serve and not to rule”. Lack of lower-level participation. Unwillingness of the employer to share powers
  41. 41. Decisions affecting WPM Three groups of managerial decisions affect the workers of any industrial establishment and hence the workers must have a say in it • Economic Decisions – Economic Decisions like methods of manufacturing, automation, shutdown, lay-offs, mergers. • Personnel Decisions – Personnel Decisions like recruitment and selection, promotions, demotions, transfers, grievance settlement, work
  42. 42. Workers' Participation at TISCO • Since Tata Iron and Steel Company are the pioneers in establishing joint consultation in India, it is worthwhile to look at workers' participation at TISCO. • Closer association of employees with management at TISCO began in 1919 and was formalized in August 1956. • The purpose was to promote increased productivity, provide a better understanding to the employees of their role and importance, and to satisfy the urge for self expression. The scheme as set up at TISCO consist of a three – Tiered system with joint department councils (JD
  43. 43. The specific functions of these three bodies were as follows: – JDCs were “to study operational results and production problems, advice on the steps deemed necessary to promote and rationalize production, imp rove productivity and discipline and econo mize cost. Promotion of welfare and safety, encouragement of suggestions and improvement of working conditions also fell within their purview.” – JWCs were “to discharge special function of reviewing every month the working of
  44. 44. • In order to ensure that these committees did not overlap the functions of other committees, separate task groups were formed. • Special courses were offered to prepare both management and union representatives to effectively utilize the facility. • TISCO's experience with workers' participation has been satisfactory. From 1957 to the middle of 1972 JDCs
  45. 45. Workers' Participation at BHEL • • BHEL stands for “Bharat Heavy Electrical Limited” According to BHEL, WPM is the process, by which authority and responsibility of managing industry are shared with workers.
  46. 46. Significance of WPM in BHEL • • • • To improve the efficiency of enterprise. To establish harmonious industrial relation. To attain industrial peace and harmony. To give the workers and
  47. 47. • • • • To increase the productivity level with mutual understanding. Easy to implement the change may by possible by WPM. Information sharing and decision making. Improving the self control degree.
  48. 48. Factors considered by BHEL in WPM • • • • Subject matter of participation Level of participation Time factor Extend of participation • • • • Industrial practices Past experience data Degree of possibility No. of workers
  49. 49. BHEL’s principle for WPM • • • Experience Possibilities People building and mutual development.
  50. 50. BHEL’s ways & methods of WPM • Maximum adopt the method of :– QC Quality Circle – TQM Total Quality Management
  51. 51. • • • • • Pre-requisites for successful participation:Strong & Democratic union. Mutually agreed objectives which should be clearly defined & complementary. Feeling of participation at all levels. Favourable attitude of all. Training of participants is essential.
  52. 52. • • • • • • • Free flow of communication and information. Participation of outside trade union leaders to be avoided Strong and effective trade unionism. Workers’ education and training. Lack of positive attitude. Trade unions and government needs to work in this area. Trust between both the parties.
  53. 53. • • How can WPM be more effective??? Employer should adopt a progressive outlook. They should consider the industry as a jointendeavour in which workers have an equal say. Workers should be provided and enlightened about the benefits of their participation in the management. Employers and workers should agree on the objectives of the industry. They should recognize and respect the rights of each other.
  54. 54. • • • There should be effective communication between workers and management and effective consultation of workers by the management in decisions that have an impact on them. Participation should be a continuous process. To begin with, participation should start at the operating level of management. A mutual co-operation and commitment to participation must be developed by both management and