Participation & involvement of workers in the management of industry is practised in most countries of the world. In Yugoslavia, it is called self-management, while in Germany, it is known as Co-determination. The International Labour Organisation has encouraged member nations to promote workers participation in management.
Meaning of Workers Participation in Management
It is the joint consultant before decision-making. It is the process by which authority and responsibility for managing the industry are shared. It is the activity in which workers are involved in the company’s decision-making process. Workers participation in management is a person’s mental and physical involvement in a group situation, which encourages him to contribute to group goals and share in the responsibility of achieving them.
There is always a need of workers participation in management. Traditionally, workers participation in management in HRM refers to the participation of non-managerial employees in the organisation’s decision-making process. Workers participation is also known as labour participation in management or employee participation in governance.
Top Forms of Workers Participation in Management
We are going to discuss different forms of participation in the below below portion:
1. Suggestion Scheme
It is one of the voluntary methods of promoting workers participation in management. It aims at enlisting man’s creative ability, providing him with an opportunity for self-expression, and motivating him towards increased productivity. Under this scheme, the management invites workers suggestions concerning working conditions, safety & welfare activities, etc.
The proposals that help cut costs or wastage, increase productivity or even show originality may be suitably awarded in cash or kind. Employers should acknowledge the suggestions promptly, and reasons should be given for the decision when they are turned down. Employers provide unique forms or boxes to employees, and good publicity should be given initially and periodically afterwards, through house journals, posters, pay pocket inserts etc.
Employers should make arrangements to cover the potential of ideas with particular merit. To sum up, “careful preparation, prompt follow-up, proper supervision, handsome awards. However, an Incentive publicity campaign will help in the success of the suggestion scheme and promote labour-management cooperation in the country.”
Advantages of Suggestion Scheme
- It encourages workers to come forward with their constructive suggestions.
- It will make a positive contribution to the growth of the enterprise.
- Also, it will promote labour management cooperation in the organisation.
Disadvantages of Suggestion Scheme
- It is a time-consuming process.
- It is a lengthy scheme.
2. Works Committee
The first labour management association started in 1947 with the passing of the Industrial Disputes Act. The Act provides that in the case of any industrial establishment in which 100 or more workers are employed on any day in the preceding 12 months, the appropriate Govt. may, general or social order require the employees to constitute in the prescribed manner a Works Committee in the establishment.
The committee was expected to discuss matters of common interest and to maintain cordial relations between workers & employers. The response to the Works committee was encouraging from beginning to 1953, and the number of such committees rose to 2095. Despite their large number of experiences, this committee was not very fruitful. There was confusion about the scope and function of these committees.
Both sides tried to use the form of these committees to give way to these grievances. Indian labour Conference in 1959 attempted to specify the areas to be covered by these committees. The condition of work, amenities, safety, administration of welfare funds, and educational and recreational activities are some of the areas specified for works committees.
3. Joint Management Council
Joint management councils are constituted under this system. These councils consist of an equal number of representatives of employers and workers. The commission discusses various matters concerning the working of the industry. The decisions of these councils are advisory though employers often Implement the unanimous decisions of the Council.
Working Councils accident prevention, indiscipline, absenteeism training and other matters are generally the matters before joint management councils. While works committees are formed at the shop floor level, joint management councils are instituted at the plant level.
4. Workers Directors
Under this method, one or two workers representatives are nominated or elected to the Board of Directors. It is a full-fledged and highest form of Workers Participation in Management. In India, D.C.M and a few other companies provide representation to workers on their Board of Directors.
Worker Participation in Management becomes complete when they become partners or shareholders in the company. Under this method, workers of an enterprise contribute to equity and thus, with management, they become co-owners of a company. Workers as shareholders may also get elected as directors from amongst themselves on the Board of Directors.
Under such circumstances, workers not only share the profit & loss of the firm but also share the management decisions. It tends to develop a sense of commitment & partnership among the employees. This method, however, has not been found favourable by both the workers & the management. The workers cannot contribute to the equity because of their low saving base.
On the other hand, leadership is generally grudging in accepting workers as co-partners. Trade unions in India do not favour the scheme of workers shareholders on the ground that a nominal shareholding by the workers can’t give them any say in management.
6. Joint Consultation
Joint consultation is the process where the employer consults the worker directly or through their representatives. And, seeks their opinion on various issues while retaining to himself the right to make decisions. It is carried on through a joint consultative committee comprising the representation of both employer & workers. It is a stage before decision-making. Joint consultation includes matters not covered in collective bargaining. Workers training, productivity & quality improvement schemes, grievances, disciplinary problems, and safety measures are covered under joint consultation.
Advantages of Joint Consultation
Joint consultation offers the following advantages:
- It promotes mutual trust & community of interest, bringing industry peace.
- Helps to improve the job satisfaction & morale of workers.
- Provides creative ideas & develops initiative among workers.
- It helps to reduce employees’ resistance to new machines and methods.
Difficulties in Joint Consultation
In real life, the following problems & difficulties arise in joint consultation.
- In the absence of a single recognised union, selecting the true representative of workers becomes challenging.
- The representatives of workers are narrow-minded & politically oriented. They fail to consider the long-term interests of the organisation and workers.
- One influential and vocal member of a joint consultative committee may overshadow the majority’s view.
- Representatives of workers are not well informed and well educated. Therefore, they fail to make an effective contribution.
Workers Participation in Management in HRM is an essential ingredient of Industrial democracy. The concept of workers participation in management is based on the Human Relations approach to management, which brought about a new set of values to labour & management. It implies a situation where workers representatives are, to some extent, involved in the management decision-making process but where the ultimate power is in the hands of the management.
What is the Need of Workers Participation in Management?
Workers participation in management is necessary for the following reasons:
1. It ensures better understanding and cooperation between workers and managers.
2. It motivates workers and enhances their productivity.
3. It leads to better decision making as workers are able to share their views and ideas.
4. It helps in creating a harmonious and democratic work environment.
What Factors Influence Workers Participation in Management?
The factors that influence workers’ participation in management are:
1. The level of education and training of the workforce
2. The level of unionization
3. The level of communication and consultation between management and workers
4. The level of trust between management and workers
5. The level of motivation of workers
How can Managers Improve Employee Participation?
There are a few ways that managers can improve employee participation:
1. Encourage employees to share their ideas and suggestions.
2. Make it easy for employees to submit their ideas and suggestions.
3. Follow up with employees after they submit their ideas and suggestions.
4. Implement employees’ ideas and suggestions whenever possible.