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Industrial disputes are the disputes which arise due to any disagreement in an
industrial relation. The term 'industrial relation' involves various aspects of
interactions between the employer and the employees; among the employees as
well as between the employers. In such relations whenever there is a clash of
interest, it may result in dissatisfaction for either of the parties involved and hence
lead to industrial disputes or conflicts. These disputes may take various forms such
as protests, strikes, demonstrations, lock-outs, retrenchment, dismissal of workers,
etc. It is a disagreement between an employer and employees' representative;
usually a trade union, over pay and other working conditions and can result in
industrial actions. When an industrial dispute occurs, both the parties, that is the
management and the workmen, try to pressurize each other. The management may
resort to lockouts while the workers may resort to strikes, picketing,etc.




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The various reasons behind an industrial dispute can generally be categorized into
economic and non-economic factors. The different types of economic causes are
related to monetary compensation like salary, wages, allowances, bonus, working
hours, working conditions, leave, medical benefits, holidays without pay, illegal
termination, refusal of employment, retrenchments and unjust layoffs. On the other
hand, political factors, sympathetic strikes, ill treatment by other workers of the
company, indiscipline etc. come within the purview of non-economic factor which
often lead to an industrial dispute or a major labour issue.

Œ‘ Ýconomic causesº

The most common causes of industrial disputes are economic causes. These
are follows:
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Œ‘ Æ
Rise in the cost of living forces the workers to demand more wages to meet
the rising cost of living index and to increase their standards of living. This
brings them into conflict with their employers who are never willing to pay
more wages to workers.

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Increase in cost of living was the main cause of the demand of certain
allowance allowances such as dearness allowance, house allowance, medical
allowance, night shift allowance, conveyance allowance etc; by the workers
to equate their wages with the rise of prices. Bonus also plays an important
role as a cause of industrial dispute. Both the amount and the method of
bonus payment have led to a number of disputes.

! !
In the changing world, concept of labour has changed considerably. At the
present, employers consider themselves as a partner of the industry and
demand their share in the profits.

Œ‘"º

!!#º

A very nominal 3% of the industrial disputes are caused by factors like

retrenchment and layoffs while 14% of the industrial disputes are caused by
personnel.


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#!

One of the leading causes of industrial disputes and labour problems in the
industries is due to misconducts, indiscipline and often violent behaviours of
the workmen towards the company. And unfortunately, this trend of
indiscipline and misconducts is moving towards an upward graph. Around
50% of the industrial disputes are direct results of misconducts of the
employees/ workers.

$%!!

Around 7-8% of industrial disputes are due to demand for bonus. Though
slowly, this trend of disputes arising out of demand of bonus is ever
increasing. Moreover, factors like working hours and leave lead to only 1-
2% of industrial disputes.

&

Apart from these above mentioned factors, an industry faces problems due to
reasons like problems between two different unions, non-implementation of
awards, agreements, violation of standing orders, service rules, excessive
work pressure on the employees, charter of demand, violation of statutory
rules and regulations etc.
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)*‘ +&!!%.
There should be progressive outlook of the management ofeach industrial
enterprise. It should be conscious of its obligations and responsibilities to the
owners of the business, the employees, the consumers and the nation. The
management must recognize the rights of workers to organize unions to
protect their economic and social interests.


,*‘
!
!- .
A strong and stable union in each industrial enterprise is essential for good
industrial relations. The employers can easily ignore a weak union on the
plea that it hardly represents the workers. The agreement with such a union
will hardly be honored by a large section of workforce. Therefore, there
must be a strong and stable union in every enterprise to represent majority of
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workers and negotiate with the management about the terms and conditions
of service. Please understand that the workers should realize that they have
to be united and represent themselves strongly.

/*‘ !#&!!.
Both management and labour should help in the development of
anatmosphere of mutual cooperation, confidence, and respect. Management
should adopt a progressive outlook and should recognize the rights of
workers. Similarly, labour unions should persuade their members to work
for the common objectives of the organization. Both the management and
the unions should have faith in collective bargaining and other peaceful
methods of settling disputes.


0*‘ &!!.
The employers must recognize the right of collective bargaining of the trade
unions. In any organization, there must be a great emphasis on mutual
accommodation rather than conflict or uncompromising attitude. One must
clearly understand that conflicting attitude does not lead to amicable labour
relations; it may foster union militancy as the union reacts by engaging in
pressure tactics. The approach must be of mutual ³Y
   rather
than
  
 The management should be willing to co-operate
rather than blackmail the workers


1*‘
#!!!.
The management should sincerely implement the settlements reached with
the trade unions. The agreements between the management and the unions
should be enforced both in letter and spirit. If the agreements are not
implemented then both the union and management stop trusting each other.
An environment of uncertainty is created. To avoid this, efforts should be
made at both ends to ensure the follow up of the agreements.


2*‘ %3 !#!&!.
The participation of workers in the management of the industrial unit should
be encouraged by making effective use of works committees, joint
consultation and other methods. This will improve communication between





managers and workers, increase productivity and lead to greater

effectiveness.



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The case study focuses on the HR problems faced by Honda Motor Cycle &
Scooters India (HMSI). The case discusses the various reasons which led to the
dispute between the management and employees of HMSI. It elaborates the
incidents, which led to the strike at the company that resulted in HMSI workers
being severely beaten up by the police. Labor strife and the management's inability
to deal with it effectively had resulted in huge losses for the company due to the
fall in the production level at the plant. In addition to this, the company also
received a lot of negative publicity as newspapers and TV channels gave wide
coverage to the violence of the action.

The case highlights the growing number of instances of clashes between the
employees and the management of companies in India, which is often guided by
external parties such as trade unions and political parties.

 
º

On July 25, 2005, the management of the Honda Motorcycle & Scooter India
(Private) Limited, (HMSI), a wholly-owned subsidiary of Honda Motor Company
Limited6 (HMCL), encountered violent protests from workers that disrupted
production at their plant in Gurgaon7.

HMSI workers were severely beaten up by the police, and newspapers and TV
channels gave wide coverage to the violence of the action. The protest followed six
months of simmering labor unrest at the HMSI factory in which the workers also
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resorted to job slowdown8 (since December 2004 when the workers' demand for an
increase in wages was rejected by the HMSI management).

With their demands being rejected by the management, the workers tried to form a
trade union and this resulted in a confrontation with the management. Fifty
workers of the production team were suspended and four others dismissed in May
2005. Apparently there was a show of strength between the management and the
workers.

While the management alleged that the workers were resorting to 'go-slow'9 tactics
and were threatening not to return to work until their colleagues had been
reinstated, the workers alleged that the management was using pressure tactics
such as victimization of active union members and a 'lock-out'10 to break the back
of the union.

On July 25, 2005, the workers of the plant were demanding reinstatement of the
suspended employees when some workers allegedly attacked policemen on the
plant premises.






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From the point of view of the employer, an industrial dispute resulting in stoppage
of work means a stoppage of production. This results in increase in the average
cost of production since fixed expenses continue to be incurred. It also leads to a
fall in sales and the rate of turnover, leading to a fall in profits. The employer may
also be liable to compensate his customers with whom he may have contracted for
regular supply. Apart from the immediate economic effects, loss of prestige and
credit, alienation of the labor force, and other non-economic, psychological and
social consequences may also arise. Loss due to destruction of property, personal
injury and physical intimidation or inconvenience also arises.

For the employee, an industrial dispute entails loss of income. The regular income
by way of wages and allowance ceases, and great hardship may be caused to the
worker and his family. Ýmployees also suffer from personal injury if they indulge
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into strikes n picketing; and the psychological and physical consequences of forced
idleness. The threat of loss of employment in case of failure to settle the dispute
advantageously, or the threat of reprisal action by employers also exists.

Prolonged stoppages of work have also an adverse effect on the national

productivity, national income. They cause wastage of national resources. Hatred
may be generated resulting in political unrest and disrupting amicable
social/industrial relations or community attitudes.