The evolution of Industrial relations in goes back to the years of the Industrial Revolution world over which created the modern employment relationship with establishments of large industrial houses which consequently lead to free labour markets with thousands of wage workers.
The evolution of Industrial Relation in India has a long history and the “Varna System” of earlier times played a very crucial role in this context as the working type was mainly caste based and it influenced the ancient industries and their development. The country has faced many foreign invasions and many times during the period workers were treated as slaves or sometimes it was hard to differentiate between a slave and an artisan. Further during the autocratic regime of Muslim rulers the situation of working force worsened.
They were not paid regularly and their living conditions were also not good. Then came the Britishers with some kind of modern industrial set up which was more organized in its structure. They even tried to model Indian industries as per British system mainly to take benefit for their country in terms of trade. They exploited the local conditionbs and consequently the labourers for their benefits. So, working conditions didn’t improve here also. Then India got independence in 1947 and only after this a proper approach was taken to manage the affairs of the workers in an organized way and enactment of Industrial Dispute Act of 1947 has testimony to this. As a nation state India was for socialism and the labour readily embraced it, however the unresolved core issue still remained in terms of the conflict between the needs and aspirations of the labour vis a vis that of India as a country.
The problem with organized labour which seems to carry on till today is that it is too minuscule part of the total labour, and besides it is fragmented into a lot of unions; the traditional AITUC became fragmented into AITUC, INTUC, HMS and UTUC between 1947-49 (Ornati, 1957). Post-independence, India was faced with improving productivity and attaining self-sufficiency; against this back-drop strife would lead to impediments in achieving this goal. Then came the recent phase which stared at the beginning of 1990s especially with the implementation of New Liberalization Policy of 1991 which paved way for an open economy and so free flow of capital and labour with India reducing its trade barriers and allowing FDIs etc. which can be seen as start of era of Globalisation which reduced the trade barriers significantly and allowed the free trade among nations consequently led to coming of so many MNCs to India. Globalisation which definitely brought economic changes in terms of economic growth and GDP it also brought with it the change in Employment Relations and brought so many challenges in Industrial Relation.
So, there is a need to look into the challenges globalization poses to IR and also to give solution to the changing needs of Employee-Employer relation so that the objectives of harmonious relations between the three actors of IR namely Employee,Employer and the State be established. It is also a time to introspect in this regard and to see India,s preparedness to face it. Globalisation vis-à-vis Industrial RelationGlobalization which refers to the increasing interaction of people through the growth of the international flow of money, ideas and culture is primarily an economic process of integration which has social and cultural aspects as well. It involves goods and services, and the economic resources of capital, technology and data. Advances in the means of transport and in telecommunication infrastructure (including the rise of the telegraph and its modern offspring, the Internet and mobile phones) have been major factors in globalization, generating further interdependence of economic and cultural activities meaning the economic activities crossing the national borders, and forming an organic economic integrity worldwide through foreign trade, capital flows, technology transfer, provision of services, interdependent and interrelations.
Globalization has begun in 1980s; especially in 1990s its process was accelerated greatly. Globalization is good for the globally reasonable resources and production elements allocation, is beneficial for the flow of capital and products globally, technological expansion in the world, and helps to promote economic development in underdeveloped countries or regions. Industrial relations on the other hand are applied to denote the collective relationships between employer’s management and the employees . “IR” may be defined as the means by which the various interests involved in the labour market are accommodated, primarily for the purpose of regulating employment relationships. IR is essentially collectivist and pluralist in outlook. It is concerned with the relationships which arise at and out of the workplace (ie, relationships between individual workers, the relationships between them and their employer, the relationships employers and workers have with the organizations formed to promote and defend their respective interests, and the relations between those organizations, at all levels). Industrial relations also includes the processes through which these relationships are expressed (such as, collective bargaining; worker involvement in decision-making; and grievance and dispute settlement), and the management of conflict between employers, workers and trade unions, when it arises.Globalisation impacts directly and indirectly on industrial relations systems and its actors.
The Indian economy has also felt the different effects of globalization on industrial relations. Due to liberalization of economy, several organizations have taken a number of steps to improve operational efficiency. This includes the introduction of quality management system, identification of NPAs and finding ways and means to transform organizations into strategic business units or profit centers. Another step that was taken in the wake of globalization or in the post-New economic policy 1991 era was the government’s decision to disinvest their stake in the equities of leading public sector undertakings. Eventually many business houses have begun consolidating their businesses and large number of acquisitions and mergers have started taking place. This change in scenario brought changes in Industrial Relations. Pressures of globalization affect employment relations and industrial relations at regional, national and international levels.