Learn about the key differences between HRM and industrial relations.
Difference between HRM and Industrial Relations
Difference between HRM and Industrial Relations
The government of India was committed to benefit the citizen and it provided number of policy guidelines both with form of Constitution of India, Articles 16, 19, 24, 38, 39, 41, 42 and 43. The industrial relations system involves the workers their associations and the government. The worker’s unions and the governments cannot be separated from the political influence in the country.
The workers have great power to decide to some of the issues by voting for the political parties of their choice. The strength of a political party decides the formation of the democratic governments. Due to change of Government Policy after 1991, the government also had to change its approach towards Human Resources. The availability of new technology, competition and the introduction of automation has affected the employees.
At the same time the employers have decided to rationalise operations, introduce highly skilled work force and reduce excess manpower. The HR management will and is gradually changing its philosophy, techniques and practices.
A new approach of resolving conflicts in a cooperative manner by allowing participation by workers, mutual negotiations, improving trust levels between the employer and employees and introducing mutually acceptable evaluation systems, rework compensation reward system, new techniques of productivity, mutual efforts for survival, are all needs of the time.
The major asset of an organisation is its human resources but experience feels that it is least used in the right manner. Due to this, employees feel that they are not a part of organisation but they are merely recipients.
So the proper management of human resources and their utilization is necessary for maintaining healthy and cordial relationship between employer and employees, employer and trade unions, employers and employers, trade unions associations in this system both employers and employees feel that they are working together for a common cause, development of organisation and progress of society and in public interest.
There is direct relationship between management of human resources and industrial relations because better management of employees means healthy industrial relations of the organisation. The human relations and industrial relations are interlinked to each other and indispensable factors in the organisation. The employees must feel that they are an integral part of the organisation to which they are attached.
Under better management of human resources, there will be group discipline, group responsibility, group motivation and maximum output is possible. The role of supervisor is very important in this direction. If he has a caring, helpful attitude towards employees and creates a healthy work environment characterised by values of openness, enthusiasm, trust, mutuality and collaboration employees are willing to give of their best to the organisation.
In this system the supervisor should act as a developer, coach, counsellor, mentor, teacher, facilitator and problem solver. In the nutshell, human resource management system in an organisation will help to foster good industrial relations, which in turn would contribute substantially to industrial harmony and progress. Under proactive HRM system the industrial relations is treated as reactive approach.
Human resource management is one of the strategic management functions. It deals with the human resource aspect of corporate policy and business objectives. It further deals with the formulation of human resource objectives, policies, procedures and programmes based on the corporate mission, objectives, policies, procedures and programmes. Similarly, the organisation formulates human resource strategies and tactics based on the corporate strategies and tactics.
The human resource management concepts take the individual employees while formulating and implementing its objectives and strategies. The process of implementing of human resources decisions results in building relationship between employer and employee. For example, the employment process brings employment relations; payment of wages brings monetary relations between employee and employer. These relations are known as industrial relations and they may be satisfactory or unsatisfactory for any one of or both the parties.
Different kinds of institutions help the employees and employee to build and maintain satisfactory relations between the parties. These institutions include: employees’ associates, employers’ associations, collective bargaining and government machinery, mediating agencies etc. Thus, industrial relations are collective relations of individual workers with their management.
The different agencies like employees’ associations, employers’ associations and trade unions help both the parties to reformulate human resource policies, strategies and tactics acceptable to both the parties. These agencies resort to different techniques like collective bargaining, participative management, labour legislations, government’s industrial relations policies, awards of the labour courts etc. Thus, human resource practices result in industrial relations and unsound industrial relations force the reformulation of HRM objectives and strategies. Thus, HRM and IR are interdependent.
Difference between HRM and Industrial Relations – 5 Points Difference
1. There are only two important parties viz., employee and employer.
2. Formulation of objectives, policies, procedures and programmes of human resources and Implements them.
3. Reformulates the objectives, policies etc., based on industrial conflicts which are the outcome of unsound industrial relations.
4. Individual employee contacts with the immediate superior.
5. Grievance and disciplinary procedures are resorted to, to solve the employee-employer conflicts.
1. These are four important parties viz., employees, employer, trade unions and government.
2. The implementation of HRM policies results in IR.
3. The sound IR contributes to the organisational goals. The unsound IR result in industrial conflicts demanding for change and reformulation of HRM objectives and goals.
4. Employees contact even the top management as a group.
5. Collective bargaining and forms of industrial conflicts are resorted to, to solve the problems.
Difference between HRM and Industrial Relations
Human resource management deals with issues and challenges of managing employment relations with each of the employees as individuals. Human resource services are designed to make individual employees happy and satisfied about the way they are given jobs, responsibilities, developmental opportunities, and compensation for meeting business goals of the company.
The design and execution of human resource services or employment relations are done by the management alone based on their assessment of organizational goal, companies internal and external human resource environment, and expectations of the employees concerned. Employment contracts are made with individual employees because every employee is unique in terms of his/her skills, expertise, and needs. An employee’s productivity could grow if he/she works hard and acquires new skills and expertise.
However, there is a distinct difference between different employees in terms of their capacity and desire to acquire new skills and expertise. In order to accommodate these personal preferences and abilities of different employees, an employer goes by an individual-centric employment contract.
In many big size organizations there are many jobs that are highly mechanical with limited opportunity to acquire new expertise or skill. For such positions the employment contracts with the employees are generally made in a standardized format. The management usually negotiates these contracts with a collective body of employees or workers called trade union.
The range of issues that such a negotiated agreement with a trade union could cover includes employment duration, wage rates, bonus payment, benefits for different categories of workers, working hours, workplace health and safety measures, union certification procedures, workplace discipline, etc. Most of these employment outcomes are common across many employees and are seldom negotiated with any individual employee for his/her acceptance.
Given that most of these employees work in very similar work settings and their contributions to the organization are constrained by the technical facilities available in their work bench, an employer may not gain much by negotiating an individual-centric contract with each of them separately. Most organizations set these common HR services for a number of employees either by following the historical past practices or after negotiating with a collective body of employees known as trade union.
Trade unions as a workplace phenomenon are more prevalent in manufacturing organizations and that too mainly at workers level. But in our country union or officers association is quite common in service sectors also, e.g., banking, insurance, telecom and leaders of these associations exercise considerable power on employment policy design even for managerial employees.
At the national level, during the year 2006, 430 industrial disputes were reported involving 1.81 million workers. Such disputes led to loss of 20.32 million man-days of workers services. The private sector accounted for 79.5% of the industrial dispute while the rest were from the public sectors.
Out of 430 industrial disputes, 56.5% were strikes while the rest 43.5% were lockouts. There were 24 cases of retrenchments affecting 884 workers. Compared to 2005, the overall trend for industrial disputes, retrenchment, and lay-offs were better in 2006.