Page 237 - DCOM404_CORPORATE_LEGAL_FRAMEWORK

Corporate Legal Framework

Notes Describe the challenges before trade unions management in changing business
environment

Introduction

Trade Union had to pass through a very difficult and hostile period in the initial years. The
employers wanted to crush them with iron hands. Then came the period of agitation and
occasional acceptance. When the union gained strength they started confronting the employer.
This is the period of struggle which continued for long. Employers were forced to accommodate,
tolerate and hesitatingly accept them. Then came the period of understanding in the industry in
collective bargaining. This was followed by a fraternal stage where union became matured and
employers started consulting them. The desired state is the “Fusion Stage” in which joint efforts
were required to be made for union-management cooperation and partnership.

11.1 Trade Unions: Meaning and Justifi cation

According to Webbs, a trade union is a continuous association of wage-earners for the purpose of
maintaining and improving the conditions of their working lives. Under the Trade Union, Act of

1926, the term is defined as any combination, whether temporary or permanent, formed primarily
for the purpose of regulating the relations between workers and employers or for imposing
restrictive conditions on the condition of any trade or business and includes any federation of

two or more unions. Let us examine the definition in parts:
1. Trade union is an association either of employees or employers or of independent
workers.

2. It is a relatively permanent formation of workers. It is not a temporary or casual combination
of workers.
3. It is formed for securing certain economic (like better wages, better working and living
conditions), and social (such as educational, recreational, medical, respect for individual)
benefits to members. Collective strength offers a sort of insurance cover to members to

fight against irrational, arbitrary and illegal actions of employers. Members can share their

feelings, exchange notes and fight the employer quite effectively whenever he goes off the

track.
A more recent and non-legislative definition of a union is:

“An organisation of workers acting collectively who seek to protect and promote their mutual
interests through collective bargaining”.
-De Cenzo & Robbins (1993)

11.2 Theories of Trade Unionism

There is no one theory of Trade Unionism, but many contributors to these theories are
revolutionaries like Marx and Engels, Civil servants like Sydney Webb, academics like Common
and Hoxie and labour leaders like Mitchall. Important theories of trade unionism are as follows:
1. Political Revolutionary Theory of Labour Movement of Marx and Engels: The Theory
is based on Adam Smith’s theory of labour value. Its short-run purpose is to eliminate
competition among labour, and the ultimate purpose is to overthrow capitalist-businessman.
Trade union is a pure and simple class struggle, and the proletarians have nothing to lose
but their chains and there is a world to win.

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