Editor’s Note
Sapling to forest he development of HR function is set against the back ground of turbulence and change in business environment, change in organization life work, processes and work culture. HRD in any organization is perceived as a function enbaling people to be treated as valued assets and efforts to constantly develop them not only as an individual but also underlying their contribution in business building. It also shoulders the responsibility of integrating the development of individual people with the organization development. It is the practice of enhancing the enbaling capacity of individuals, collectives and organizations through the development and application of learning based interventions for the purpose of optimizing employees and organizational growth. It is this function which has been able to convert the mind set from veiwing the employees merely as a tool of producing the desired results to recognizing them as human capital. But this is not enough. HR function has to go a long way in this journey. It has to establish environment conducive to encourage creativity, innovation and effectively utilize the energy of the workforce with commitment for the growth of the organization in total. It would also be relevant to point out that why inspite of relentless efforts to establish this function as a machanism of business growth, HR function still has to struggle for due recognition in the organization.This is probably because of growing attitude among HR professionals to change jobs quickly and contributing less, thereby creating dent on credibility. No doubt, HR function is getting sharper attention since 1980s. This decade can be called the decade of HRD. It is no secret that Dr.T.V. Rao and Late Udai Pareek are recognized as pioneers / founders of this function in the country. Due to their consistent efforts, organizations conferred importance and recognition to HRD. Since then organzations are striving to derive benefits through HRD practices. A sea change has taken place in the organizations’ climate. There may also be certain inadequacies in HRD practices which create roadblocks and prohibit the organizations from being effective. Here the meaningful role of HR professionals comes in.They are expected to remove these inadequacies while formulating the strategies and designing HR interventions as time moves on. The cover feature of this issue carry vibrant views of Dr. T.V. Rao, the stalwart founder of HRD function in the country on the subject alongwith the article he and late Dr. Pareek penned down the saga of development of HRD. If you like it let us know. If not, well, let us know that too. Wish You a Happy & Prosperous 2012.
T
Anil Kaushik
Readers Response
First of its kind
Excellent learnings
HR Case Studies depicting the situations and their mishandling leading to labour unrest, along with analyses can only be expected from BM. No words to appreciate the real contribution your magazine has made in helping HR people to understand this complex subject. I, with 35 years of experience, have not seen in my life such a issue of magazine full of liveliness and extreme relevance. It is first of its kind in the country providing so much material in one issue. It also reflects your editorial insight and depth about the subject. I am afraid your each issue is creating a bench mark against your own. How would you compete with yourself ?
All the four case studies published in your Dec. 11 issue provide excellent learnings to all of us who have never thought of labour unrest of its kind and the reasons behind such trouble. I am new generation HR manager who has only read few labour law books as a course subject in my professional studies but all this which you have presented was beyond my imagnation. We were told that IR no more exists and this side of human relations has been down played. Until I read this issue, I thought of myself a person in HR having enough knowledge but now I realize, what I knew was only the tip of the iceberg. BM has contributed a lot in my career growth and knowledge advancement.
Prakash Jain, New Delhi
Innovative Case Studies on Industrial Relations published in Dec. 2011 issue is quite innovative. It is also an example of extreme creativity. The analyses by various experts of each case are so multidimensional, leave nothing to add. I don’t think any magazine has made such a wonderful contribution. Mahabir Singh, Noida
IR is back The incidents of last few years specially in auto manufacturing sector of the country and your comprehensive case studies on industrial relations indicate that IR is quietly back and your magazine has done a pious duty to caution the industries and HR managers about the foot steps. It is finest example of making HR people complete as your tag line says too. Dr. Subhadra, Cuttak
Can’t afford to miss I have read Dec. 11 issue, specially all four case studies and analyses. Yes, I agree with anatomy of the cases done by persons who are really experts of the subject. Normally what we see the case studies are published alone and not alongwith analysis with them. BM has made a difference. In real sense analyses with the case studies make the magazine complete. I am of the view that no person who is associated with HR function directly or indirectly can afford to miss this issue. If any one has not read it, he will miss a lot. I request you to make a book of such case studies for future reference. Tridev Nandan, Jamshedpur
Preetpal Singh, Jaipur
From darkness to light I must admit that before reading Business Manager regularly I was like living in darkness assuming the whole world as it was. With each issue you are throwing light in all corners providing HR persons enough practical knowledge to perform better in their jobs. Dec. 11 issue articles of various labour issues is sufficient to prove that people management issues are not simple to understand and resolve not even by HR managers, what to talk of technical managers. I feel that most of us spend our career in maximum darkness without understanding the reality of human behaviour in industrial organizations. Sunil Kumar, Lucknow
Disregard of HR function I have read all the four case studies and analyses of all the top brains of the industries. It will be injustice to remaining experts if I comment about any one in specific. All analyses compete with each others in terms of quality contents and depth of understanding. But if you allow me to conclude the issue of labour unrest in one sentence, I will say it is nothing but only due to total disregard of HR function by industry which gives room to grow labour unrest. Unless their attitude of fire fighting tool towards HR is not changed, problems will continue to crop up and issues like this will also come in future. TKS Murthy, Vishakhapanam
Readers are invited to comment on articles published in BM through email at : bmalwar@yahoo.com, bmalwar@gmail.com 2
Business Manager
January 2012
Inside
Cover Feature
January 2012 Vol. 14 No.7
Sapling to forest
Journey of HR
Chief Editor ANIL KAUSHIK Associate Editor Anjana Anil Hon'y Editorial Board Dr. T.V. Rao, Dr. Rajen Mehrotra, Dr. V.P. Singh, H. L. Kumar Delhi : F- 482,Vikaspuri, New Delhi-18 GHAZIABAD : A - 39, Lohia Nagar, Naya Ghaziabad (UP) Hon'y Co-ordinators Dr. D.N. Singh- Ahmedabad dinanath.singh@cadilapharma.co.in
A.S. Sharma - Gurgaon assharma@jurishr.com
Pankaj Pradeep- Pune Pankaj.Pradeep@fiapl.com
Mihir Gosalia- Mumbai mihir@mihirgosalia.com
Indranil Banerjee- Kolkata indranil.hr@gmail.com
Owned, Published and Printed by Anil Kaushik at Sun Prints, Ganpati Tower, Nangli Circle, Alwar - 301001 and Published From B138, Ambedkar Nagar, Alwar - 301001 ( Raj.) India Editor : Anil Kaushik
The views expressed in the articles published in Business Manager are those of the authors only and not of the Publisher/Editor necessarily. ã Business Manager
While every effort is made to have no mistake in the magazine, errors do occur. Publishers do not own any responsibility for the losses or damages caused to any one due to such ommissions or errors.
Annual Subscription 900/- through DD (by ordinary Book-Post) (by Courier 1140/-) favouring Business Manager ( Please add 40/- to outstation Cheques) may be sent to: B-138, Ambedkar Nagar, Alwar - 301001 (Raj.) India, Ph : 91-144 - 2372022 www.businessmanager.co.in E-mail : bmalwar@yahoo.com, bmalwar@gmail.com Published on 1st of Every Month
INTERVIEW
Stay longer & contribute to organization : TV Rao CONVERSATION
T.V. Rao on OD Present and Future From a sapling to the forest:
The saga of the development of HRD in India This is an account of the growth and development of HRD function in India. What started in the mid 1970s as a conceptualization of an integrated HRD system to change the performance appraisal system in a large engineering company, resulted in the establishment of HRD departments in many firms. Further, dissemination and perseverence resulted in the establishment of a centre of HRD and subsequently the birth of a professional body and later, an academic institution. The authors Udai Pareek & T.V. Rao describe the growth in eighth stages and conclude the parth for futhure is in pg. moving towards national HR policies and other social sectors. Business Manager January 2012
15-29 3
Inside
Work Life Balance
pg.
pg.
pg.
Many husbands avoid going home early as they think will have to negotiate conflicts with their wife and hence they tend to pretend they are busy at office. I am surprised to see how men and women can talk for hours when they are courting and that too without many conflicts and how things suddenly change once they are married. An article by N.C. Narayanan
06 09 12
Annual Increments : Principles & Practice Every year the employers are confronted with the problem of giving increments, more particularly when there are no scales. The determination of the size of the increment as well as the number of steps in a grade is an important issue.There is no universal criterion for determining the size of the increment within a scale. Arbitrary and whimsical granting of multiple or irregular increments can cause great heartburn and bitterness. The organization should strictly adhere to a firm and consistent policy. An article by H.L. Kumar
Best Practices of High-Impact HR Organizations
ISTD Conference
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pg.
Event Reports pg.57-61
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Helpline
Labour Problems & Solutions Questions by readers on variety of problems they face at work and answers by Anil Kaushik Chief Editor. Look at it. These may also be of some help to you.
The challenge for HR professionals today is living up to the high expectations that come with a seat at the table - expectations to drive business results through people and culture," said Bersin's Harris. "Our new HR Practice and this particular body of research reveal the keys to driving impact. We are also addressing long-standing requests by our Bersin & Associates members to help them prioritize and align their HR strategies with the business to deliver the greatest return." An article by John Hollon
SURROGATE HR
pg.
A Conversation with Self‌.
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Skills of getting things done?
pg.
Skill & intellect alone is not enough.The employee also needs to possess a know-how to get things done within an organization. An article by Mihir Gosalia
31
Chicken Shorba for Employer Soul pg.
Employee is the one who if puts his heart with his labour in his work, finds soul in the work and brings laurels to the organization. And the one who does all this is usually the one with a perfect fit. An article by Mansi Madan
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Whether ESI is paid on conveyance allowance
pg.
44
There are conflicting judgments of various High Courts on the point whether conveyance allowance should be treated as wages for ESI contributions. While Madras High Court in six judgments from 2000 to 2011 has held that conveyance allowance will not be treated as part of wages, Karnataka, Kerala Andhra Pradesh High Courts have held conveyance allowance will be part of wages for ESI contributions. An article by Niraj Kumar CASE STUDY
Non Peformers loyalty : Asset or Liability? By Dr.Santosh Dhar, Dr.Gulab Mohite & Ms.Usha Kumar
pg.
47-55 4
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By Chinmoy Sarkar
CASE STUDY Of United Breweries Ltd.
Organizational Theory & Corporate Social Responsibility By Suvro Raychaudhuri & Debismita Gupta
Business Manager
January 2012
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Judgments Latest from the Courts
Latest verdicts from different High Courts and Supreme Court effecting employer employee relations.
Govt. Notifications
Book review
HR News
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Attention Subscribers Cost of paper and other process of bringing out the journal has been on rise. Since last 10 years BM has not increased the subscription charges. But now, from January 2012 we are constrained to make nominal increase in subscription from Rs. 800 to Rs. 900 per year. Hope subscribers will -Ed. keep continuing their support.
N.C. Narayanan Founder & CMD SSA Business Solutions (P) Ltd.
How to maintain worklife balance
Work Life Balance Tip-1: Quality vs Quantity of time: I remember long time back, when I was facilitating a Personal Growth lab for one of my clients, my daughter who was 14 years old then, accompanied me. While I was handling a session on work-life balance, one of the participants asked my daughter "Hi Sashi, your father being a busy consultant, he may be hardly spending time at home; how do you feel about it?" And my daughter spontaneously answered, "It is not the quantity of time that is important but the quality of time is more important -and he spends Quality time with us!" I was amazed by her answer; as a young girl, she had rightly acknowledged her father's contribution to her life. I agree, in modern life style we get little time with the family and often we wish to stare at the idiot box most of that time instead of indulging in a conversation with our spouse or the children. Many of us feel that we can't really have long, meaningful conversations with our children, as we do not really have much in common to talk about with them, considering the generation gap; and this thinking is the result of trying to find meaning in whatever we do; which, at times, in not possible.! My grandson is 2 ½ years old and, I agree, it is not possible to discuss with him about my business plans. He has his own agenda while I spend time with him, and I decide to go with his agenda as 6
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Quality vs Quantity of time Don't aim to win all the time The Family comes FIRST Make intelligent Choices Share & Build your Child Don't fail to leave a memorable moment
that is the only thing that is possible! Even if I spend just half an hour with him, while he beats me at least twice in between, I have realized that I enjoy every moment (including beatings) of it, as I have to go back to my childhood to match his frequency. And it brings immense joy. Please remember, life is a bundle of human interactions and to spend quality time with our spouse and our children, we need to make a conscious choice and some adjustments.
Tip-2: Don't aim to win all the time: Many husbands avoid going home early as they think will have to negotiate conflicts with their wife and hence they tend to pretend they are busy at office. I am surprised to see how men and women can talk for hours when they are courting and that too without many conflicts and how things suddenly change once they are married. You'll find them in perennial conflicts. Why? Well, finding an answer to this question is closer to attaining nirvana to me! How two human beings, who have started to share their life, can have huge conflicts in any conceivable agenda? The only root cause I could think of is that each one of them wants control the other human being - the aim is to win all the time. Even if they know secretly that their argument is futile. But they still want to win the argument and have an upper hand in the conversation. No wonder, divorces are increasing world over,
WORK LIFE BALANCE
including India, as both the spouses don't want to give up their so called "rights". Life is not all about winning and controlling always. It is also about being controlled and loosing, sometimes. While you play hide & seek game with your child, you hide in a place where the child can find you out because eventually you want the child to win. You derive pleasure in losing and not winning. Similarly, there are many occasions between husband and wife where losing can be more pleasurable than winning. For example, the wife always wants to select her husband's clothes while she does not want her husband to choose her saris! Have you not experienced this when you affectionately buy her a sari, expecting she is going to hug and kiss you? But instead she ruins your excitement by scolding you to buy her such an expensive sari; because she thinks that the shop keeper charged you more than the real worth? Initially, I thought it is only me who has had this experience; but after checking with many friends, I concluded that all the husbands around, without exceptions, have resolved not to buy any clothes for their wives in their life time for having had similar experiences! Please allow your partner to decide few things without your interruptions. The sari is just a medium through which husband expresses his love and not an end in itself. Ignore the sari and see the love!
Tip-3: The Family came FIRST We often have confusion, "Is the job for family or Family for the job?" The social arrangement called family has a strong rationale and it came first and the job came later; for the livelihood of the family and not the other way around! For some unknown reasons all species wish to
live together - you see a flock of same feathers and herds of the same kind of animals. There is no system called marriage in an animal kingdom and it never posed any social problems also but the same logic cannot be extended to human beings who live in a society and are an advanced version of the same species. Psychology says, "we exist in others listening" - what does this really mean? It means that I can be sane only in the presence of other human beings and my identity comes from others. For example, if I am alone on this planet, "I as NC" cannot be defined and I will also be another kind of animal altogether. So the necessity for a family comes from the paradigm that for remaining sane you need loved ones. - But we get so involved in everything else that we forget to love them back!! Jobs came next; with the primary aim of supporting the family, but unfortunately they assume more significance than the family, which was the very reason for the job in the first place. The means has assumed more importance than the end. Unless we are conscious of this fact, there will be redemption for us. For many, career assumes more importance than seeing a smile on the child's face.
Tip-4: Make inFtelligent Choices I recently met a successful young professional and was exchanging pleasantries with him on the topic of 'work-life balance'. Quite surprisingly, he mentioned that he had stopped reading the newspaper and watching TV since last 3 years; so that he can gain time to spend with his family. I was happy to hear that my son and I did the same thing long time back. For a modern mind, this may look stupid as the obvious question that comes to our mind will be, "How do you know the developments in the country, without reading or watching the news, which is also needed to do your job better?" So he also cited a dialogue he had with his boss, who had questioned his ability to perform without reading economic times. Let us deal with this rationale. My son Naveen used to say, "Newspaper is a good companion while you are on the toilet seat when your body is busy, so your mind
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7
WORK LIFE BALANCE
also can be engaged on something!" If you carefully examine the contents of newspapers today, most of it covers politics and crimes, which is good for nothing and pollutes your mind. At least definitely not something you want to start your morning with! Tell me, for how many business decisions that we have taken, the inputs have come from the newspapers? Unless otherwise you are a Narayana Murthy of Infosys or a CFO of a large corporate or if being updated on various happenings is a chronic need for your business! If you record yourself during your 'TV viewing' in a video camera and view it later, you will find your attention span and enjoyment! It is not the argument in favour of or against the newspaper or TV. The real point is that at the cost of spending time with your loved ones, all other activities are simply worthless. It is the matter of choice you have to make.
Tip-5: Share & Build your Child According to me, one of the most awful schools of thought in India is keeping children at bay in the name of respect for elders. I grew up in Tamilnadu, where I hardly remember having any conversations with my parents; except being controlled by them on all occasions. We, inadvertently, seem to feel that children cannot understand complex things and so we tend to avoid sharing our thoughts and concerns with them. As kids, we were kept in dark on many matters that the family was negotiating. The fact is that the child starts learning when it is the womb itself and, to me, the very meaning of the "generation gap" is accepting with humility that the next generation is far more
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January 2012
intelligent and sharp in learning. Indian epics are kept in our homes for the parents to instill values through storytelling in to their children. I used to share all my key learning with my children when they were very young, even if they yawned or showed signs of indifference. Now, when they are grown ups and lead their own lives, they say, "Dad, all that you shared when we were young, was not making any sense then, but that was ingrained in our sub-conscious and it became the North Star of our life." And I feel extremely happy to hear that.
Tip-6 Don't fail to leave a memorable moment I remember my son re-calling now an incident from his childhood' when he was merely 5 years old. He got hurt while playing and was admitted to the hospital. On the day he was discharged, he wanted a Ferrari car (of course the toy car only!) but I found all shops closed. I made one of the shop keepers open his shop and bought him that Ferrari. I really doubt if the happiness that toy gave him back then can ever be equaled even if I were to gift him real Ferrari now. It may look like a silly event, but to that little child, it made all the difference with my assurance to him that, "I am there with him." The point I am making is Life is a bundle of such prima facie-trivial moments, which may not be equal to receiving a Nobel price but, when you look back in retrospect, you will remember such small joyous moments more than the Nobel prize. Seeing smile on the faces of your loved ones (including your spouse), needs only a small act of kindness and compassion but it is worth a million and the joy there from is unparalleled. BM
H.L. Kumar Advocate, Supreme Court
Annual Increments : Principles & Practice Every year the employers are confronted with the problem of giving increments, more particularly when there are no scales. The determination of the size of the increment as well as the number of steps in a grade is an important issue. There is no universal criterion for determining the size of the increment within a scale. Arbitrary and whimsical granting of multiple or irregular increments can cause great heartburn and bitterness. The organization should strictly adhere to a firm and consistent policy.
C
ome January and scramble for increments starts. Employees virtually pine for January. It causes flutter for annual increments in most of the organizations. In many developed countries, increments are performance-based but not so in India where it is considered to be the right of employees. Increments are mainly meant to set-off the growing inflation; so as to neutralize the dearness. The idea behind it is, however, to grant the periodic increase in the salary of qualified employees on the basis of merit, within the framework of a uniform salary scale. The other objective of the annual increment is to recognize the increased responsibilities of employees. Wages in India are usually in the form of scales with annual increments. Annual increments are given because it is assumed that the employee will be performing more effectively upon experience, that each year he will be more useful and skilled. Consequently, as his contribution increases, there should be an increase in his remuneration. They provide them proper maintenance as they advance in age. Every year, the employers are confronted with the problem of giving increments, more particularly when there are no scales. The determination of the size of the increment as well as the number of steps in a grade is an important issue. There is no universal criterion for determining the size of the increment within a scale. The right to claim increment depends upon the actual
terms of contract of employment or the appointment letter. However, if a person is appointed in an incremental pay-scale, he would be entitled to enforce it. Where, the rules provide that the workmen would normally receive the annual increments in their wages if they are efficient, punctual and of good conduct at the discretion of the Management, then such discretion must be exercised reasonably and judicially. Increments, after all, are given to motivate employees to expand their efforts and to work smartly. The annual increments are different from special increments and personal allowances. The special increment or the personal allowance does not form a term of employment by its very nature and, therefore, no legal right can accrue for claiming it as a matter of right. But this is not so in the case of annual increments. If there is graded payscale, the annual increment will automatically fall due in a definite sum on the completion of one full year. Arbitrary and whimsical granting of multiple or irregular increments can cause great heartburn and bitterness. The institution should strictly adhere to a firm and consistent policy. The following are some suggestions as necessary elements of such a policy. (i) No increment should be given without giving in writing the concerned employee. (ii) To reduce bookwork, increments, whether on direct recruitment or on Business Manager
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FAnnual Increments : Principles & Practice
The Management may have discretion to refuse increments for proper reasons but not otherwise. The grant of annual increment may, however, be withheld as a measure of punishment or for proved inefficiency or any act of misconduct.
promotion, should be granted with effect from the first of the month, the first of January of each year following the anniversary of the date of appointment or promotion. (iii) For the overwhelming majority of employees, the ordinary practice should be one increment per year. (iv) Only outstanding and clearly documentable excellence of performance should be rewarded by more than one increment per year.
Graded salary structures A graded salary structure consists of a sequence of salary ranges or bands, each of which has a defined maximum and minimum. It is assumed that all the jobs allocated into a range are broadly of equal value, although there will be a system of salary progression (see below) which will mean that the salaries of individuals in a job will advance through the range for that job, in line with merit or service or a combination of the two. A typical graded salary structure will look like as under:
To design a graded salary structure it is necessary to: (a) Obtain salary survey data on market rates. (b) Carry out a job evaluation exercise which ranks single jobs or groups of comparable jobs in order of importance. (c) Decide on the upper and lower limits of the structure as determined by the highest and lowest paid jobs. (d) By reference to the upper and lower limits and the design parameters, work out 10
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how many grades are required. (e) Slot the jobs into grades by reference to the job evaluation findings and market rates. Some judgment is required when grouping jobs into grades, and in a competitive situation, it may be that market forces have to prevail.
When can annual increments be withheld? The Management may have discretion to refuse increments for proper reasons but not otherwise. The grant of annual increment may, however, be withheld as a measure of punishment or for proved inefficiency or any act of misconduct. But such punishment can be inflicted only in compliance with the procedural rules of natural justice and in the bona fide exercise of disciplinary power of the employer. Usually the annual increments are subject to the efficiency bar in the incremental scales. Where there is ample evidence on record to show that ad-hoc fixed yearly increments have been allowed by the Management and where such increment has been regarded by both the employer and the workmen as a normal feature of service conditions of the employees notwithstanding the absence of any fixed incremental scales or maximum salaries, a claim by a workman for such an increment as a matter of right must be held to be justified provided he satisfies the other conditions for the grant of increment, viz., of satisfactory record of service for the year in question.1 An increment is earned as a matter of course in many cases. In one case the increment, due to the employee on the 1st April, 1970, was payable to him on that date. However, a departmental proceeding was pending against him. But mere pendency of departmental proceedings, it cannot be said that the employee was guilty of misconduct or gross inefficiency, as required by the Sastry Award, for stoppage of increment. Therefore, the increment that could be stopped was only which would be falling due after the employee was found guilty on a proper departmental enquiry. It has been held there was no justification on the part of the Management in stopping the increment of the employee who was entitled to it on the 1st April, 1970, in the hope that the employee would possibly be found guilty of misconduct in future. The Sastry Award does not give the Management power to pass an order withholding the increment retrospectively by
FAnnual Increments : Principles & Practice
Suggestions No increment should be given without giving in writing the concerned employee. To reduce bookwork, increments, whether on direct recruitment or on promotion, should be granted with effect from the first of the month, the first of January of each year following the anniversary of the date of appointment or promotion. For the overwhelming majority of employees, the ordinary practice should be one increment per year. Only outstanding and clearly documentable excellence of performance should be rewarded by more than one increment per year.
way of punishment. One can only stop something by way of punishment which is to come in future and not what has already accrued to the employee. The Sastry Award does not say that the mere pendency of a proceeding would entitle the Management to withhold payment of increment of an employee retrospectively, if found guilty.2
Basic principles for fixation of increments
Therefore efficiency bars are put into the scales to see that the acquisition of skill that can reasonably be expected with the passage of time, actually does take place. This is both to insure development as well as to motivate employees to acquire further knowledge and skill. The best that can be done to grant the annual increment is to go for proper assessment and appraisal of the employee which should be made the determining factor for increments. BM
The scales of increments are fixed on the principles of financial capacity of the employer and the region-cum-industry basis. Once it is found that the employer has the financial capacity for sustaining the burden of increments, the award of annual increments is to be held to be a normal rule. The scales of increments fixed under the settlement or award cannot be stopped unless it is proved that the employer is incapable of bearing the financial burden of such increments. In such cases, the approach to the problem should always be motivated by the requirement that an employer must ensure and achieve industrial peace which is essential for the development and expansion of industry. And this could be achieved not merely by having on the one hand and investing public who would be attracted to the industry by a steady and progressive return on capital which the industry may be able to offer but also by securing a contented labour force on the other hand. Efficiency bars and proper assessments An efficiency bar in a time scale means that an employee coming to that stage has to satisfy certain requirements (efficiency, skill, ability, etc.). He becomes entitled to cross the bar only if he satisfies these conditions. 1. Bharat Homeo Pharmacy Ltd. vs. Their Workmen, 1956 (1) LLJ 705. 2.General Assurance Society Ltd. vs. General Assurance Society Employees Association, 1952 (2) LLJ 193; O.A. Oomemen vs. Management of Hindustan Aeronautics Ltd., 1973 Lab. IC 1002 Business Manager
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John Hollon Vice President for Editorial of TLNT.com
Best HR Practices Structured governance and business case development HR impact opportunity -
39%
Developing advanced workforce planning capabilities HR impact opportunity -
28%
Implementing the "right" HR philosophies HR impact opportunity -
27%
Reducing administrative work for HR business partners
Best Pra ctices t c a p m I h g i H f o
HR impact opportunity -
25%
H R
Implementing flexible HR organization design HR impact opportunity -
20%
Improving employee-facing HR systems HR impact opportunity -
19%
Measuring both HR operational and business metrics HR impact opportunity -
19%
Developing internal HR skills HR impact opportunity -
13%
Improving line manager capabilities HR impact opportunity -
10%
Outsourcing HR services strategically HR impact opportunity -
13% 12
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Organizations
I
n the years since, HR leaders have fought an uphill battle to change the profession. Today, smart companies do have a place at the table for HR. The challenge for HR now is in living up to the high expectations that come with the seat - expectations of high impact. It is not easy‌
With this new report, we tie together past research in the areas of talent and learning, and brand new research on the strategic elements of HR we have found that hold the greatest challenges for the function today."
HR organizations lack the skills to succeed The bottom line to the new Bersin research is pretty simple: it shows that many HR organizations still lack the skills they need to succeed in 2011. The study, which included surveys and interviews with more than 720 global organizations, found that overall spending levels, organization structure, and team size have far less impact on business performance than the skills of the HR professionals themselves. "This research clearly shows that the days of bloated HR organizations focused on administrative tasks are over," said Josh Bersin, chief executive officer and president of Bersin & Associates. "Lean, technologyenabled, well-trained HR teams are able to take advantage of modern talent practices and partner with business leaders to drive impact." The research also makes the case that the decades-old "HR generalist" model is no longer effective unless the HR generalists are highly trained and connected to senior business leaders. That sounds like a contradiction
Best Practices of High-Impact HR Organizations
to me, but the study also points out that the key HR competencies that drive results today are familiarity with integrated talent management, understanding of workforce planning, and comfort with social networking and HR technology.
Top 10 HR Best Practices
T
he challenge for HR professionals today is living up to the high expectations that come with a seat at the table - expectations to drive business results through people and culture," said Bersin's Harris. "Our new HR Practice and this particular body of research reveal the keys to driving impact. We are also addressing long-standing requests by our Bersin & Associates members to help them prioritize and align their HR strategies with the business to deliver the greatest return."
What I found most compelling in the survey was the list of the Top 10 HR Best Practices that produced the highest impact ratings out of all of the 140 HR practices and features that Bersin evaluated. See if you agree that this is a list that makes a lot of sense: 1. Structured governance and business case development (HR impact opportunity - 39%). From Bersin: "Building a business case requires a clear understanding of the business or businesses that HR serves, as well as working relationships with all business leaders. HR can achieve both by involving business leaders in the planning processes and governance. This involvement also helps to ensure business alignment and, as a result of that alignment, business buy-in and support." 2. Developing advanced workforce planning capabilities (HR impact opportunity - 28%). From Bersin: "Highimpact HR organizations incorporate sophisticated forecasting and workforce analytics into their processes. This enables them to translate company-wide talent, business data and external workforce segment data into workable insights that they can use and share with business leaders." 3. Implementing the "right" HR philosophies (HR impact opportunity 27%). From Bersin: "High-impact HR organizations tend to commit themselves to creating work environments that enable employees to thrive both as individuals and as contributors to business success. They strive to create positive employee environments, and clearly communicate these expectations in the HR philosophy and mission. The most effective philosophies focus on fostering innovation and collaboration, or creating the best place to work, while the least effective philosophies focus narrowly on efficiency or cost-cutting efforts." 4. Reducing administrative work for HR business partners (HR impact opportunity - 25%). From Bersin: "Many HR functions have a role that is a liaison between the HR function and business leaders. The specifics of this role vary widely. High-impact HR organizations use it to advise senior business leaders, focusing on decision support, workforce planning, leadership development and executive coaching. By enlisting the right person, HR can improve its credibility Business Manager
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Best Practices of High-Impact HR Organizations
across the enterprise, improve working relationships with business leaders, cultivate mutual understanding and gain influence. When this role is implemented poorly, with more focus on administrative duties and taking orders, our research found that it can actually reduce an HR function's ability to work effectively and efficiently." 5. Implementing flexible HR organization design (HR impact opportunity - 20%). From Bersin: "High-impact HR organizations are flexible and agile. Like earthquake- proof buildings, they are structured to allow adaptive movement if the ground shifts. No overall HR structural model (centralized, decentralized or a combination of the two) in itself emerged as a predictor of HR success. But certain structural features do lend themselves to areas of excellence. One feature that we found to be universally valuable was flexibility. Fancy organization charts and designs are fine - provided that you also have a culture which recognizes the need to adapt structurally when business needs and challenges change, as well as an HR staff that is capable of making those changes." 6. Improving employee-facing HR systems (HR impact opportunity - 19%). From Bersin: "The most significant contributions to the overall effectiveness of an HR function come from communitybuilding and self-service elements. Knowledge-sharing portals, web-based recruitment tools and management dashboards let various HR stakeholders and clients find what they need when they need it. HR functions with user-friendly client systems are regarded as twice as effective and efficient as functions that do not invest in this advantage." 7. Measuring both HR operational and business metrics (HR impact opportunity - 19%). From Bersin: "Measurement strategies in high-impact HR organizations have evolved to ensure efficiency, effectiveness and business alignment. Such strategies incorporate both operational measures by which to manage the HR function and strategic people measures to support crucial business decisions." 8. Developing internal HR skills (HR impact opportunity - 13%). From Bersin: "As they focus on programs to develop employees company-wide, HR organizations often neglect the development of their own team members. This is a mistake. The world of HR solutions is constantly changing. Highimpact HR organizations must invest the time and money needed to ensure team members' competence grows in such disciplines as change management and relationship management. Efforts must 14
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also focus on developing team members' business acumen, industry knowledge and command of current best practices in all areas of talent management, as well as the use of social networking tools and other HR technology." 9. Improving line manager capabilities (HR impact opportunity - 10%). From Bersin: "A common pitfall for many HR functions is the attempt to meet the needs of every stakeholder directly, thereby spreading limited HR resources very thinly. High-impact HR functions have prioritized the focus of their HR resources on building the capabilities of their line managers. This decision allows them to work in partnership with their line managers, versus trying to work around line managers who may be incompetent or ill-prepared. 10. Outsourcing HR services strategically (HR impact opportunity - 10%). From Bersin: "High-impact HR organizations use outsourcing to enable their internal teams to focus on things that cannot be outsourced, such as building business relationships and developing custom solutions for business managers. These organizations outsource areas that can be improved through economies of scale, or which require global coordination and expertise. What an organization outsources often depends on its level of maturity." Seat at the table = high expectations The research study comes out of Bersin & Associates' new HR Practice, which was recently launched, the company says, to "address long-standing requests from HR professionals to help them build their skills, and prioritize and align their HR strategies with the business to deliver the greatest return." "The challenge for HR professionals today is living up to the high expectations that come with a seat at the table - expectations to drive business results through people and culture," said Bersin's Harris. "Our new HR Practice and this particular body of research reveal the keys to driving impact. We are also addressing long-standing requests by our Bersin & Associates members to help them prioritize and align their HR strategies with the business to deliver the greatest return." I'm not sure how the HR Practice will go for Bersin, but if it performs like other parts of the Bersin organization, it should give all the other HR consultants a good run for their money. In fact, just this list of the Top 10 best HR Practices is a great start because it clearly gets to the heart of what HR needs to be doing to add value to an organization. And if you have spent much time around HR, you know that just about everyone needs to focus a lot more on that. BM
Sapling to forest
Journey of HR
H
R function is getting sharper attention since 1980s. This decade can be called the decade of HRD. It is no secret that Dr. T.V. Rao and Late Udai Pareek are recognized as pioneers / founders of this function in the country. Due to their consistent efforts, organizations conferred importance and recognition to HRD. Since then organzations are striving to derive benefits through HRD practices. A sea change has taken place in the organizations climate in India. Dr. T.V. Rao alongwith article Mapping the journey of HR from sapling to forest talks to BM on various shades of the function and present and future of OD in the following pages.
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Interview Dr. T. V. Rao
Stay longer & contribute to organization : TV Rao nitiating the dialogue, Dr Rao was silent for couple of moments as if, he was scanning the last two and half decades travels of his professional commitment to the HRD Cause and appeared, for a moment, in apensive mood‌ 'Indian Indsutry has come a long way in the last two decades, and Indian Industry has also become a worldwide noticeable industry. Unlike the earlier years, Indian Products and services got global prominence as all of them started competing in making quality products and offer globally competitive services. There is a sea change in the country. Speed became the order of the day as World Wide Web provided all information and services at the door step. Many organizations started downshzing in nineties and stablizing subsequently in terms of costs, speed, service quality and other parameters. The last one decade has seen two unexpected experiences (the dot come burst and the new economic crisis or world wide recession experienced in 2008-09), have come out of it and continued to do business as usual. Competition has become global.Technology has become cheaper and accessible to many. Finances are available in plenty most of the time as there are investors for good ideas and risk takers too. Talent has become more scarce and expensive and hence become a strategic variable. HRD has come under focus in the last one decade much more than before and competent and committed HRD managers have become scarce. The emergence of a large number of consultants and consulting firms and management schools specializing in HR are indicators of this HR spurt in the last decade. Most CEOs have recognized the importance of the spotting, procuring, nurturing, retaining and developing talent. HRD Managers have a difficult and challenging task.
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Chairman TV Rao Learning Systrems Pvt. Ltd., & Adjunct Professor - Indian Institute of Management, Ahmedabad
In a candid personal meeting with Dr. Talam Venkateswara Rao, Indian Academic and Corporate World popularly know him as 'TV', Dr. D. N. Singh, Honorary Coordinator, Business Manager Ahmedabad, explores many of the untold and unheard think through of TV. Dr Singh met with TV, and both travelled the long planes of Human Resource:
Interview However, as the opportunities grew, HRD Managers also started job-hopping. This has partly affected the credibility of the HRD Profession. HRD Professionals ended up as having two images- one in the eyes of themselves and the CEOs and another in the eyes of the other employees. Employees dependend on HRD for their growth and maintenance. While HR administration was predictable and any one can do well with little training the more diffcult and challenging task of nurturing and developing talent and creating a culture for effective utilization of talent is complex, long drawn, needs expert help and sustained effort. It is easy to arrange transport and visas and create good physical work conditions and predictable benefits schemes, it needs different skills base to plan, manage and develop performance, and motivate people, get their commitment to stay with the company, get them to enjoy work and show commitment and at the same time grow in the company. It is here that the professioal expertise of HRD Mangers and their sustained efforts was required. Pointing in black and focussed manner the current HR Landscape, a beaming TV provided a bird's view think through on the subject: HR Managers should balance their focal points between themselves, department, profession, Organization and Country. Plenty of opportunities are available in the country, and Human Resource Professionals can focus on them. Look at recent trend of high attrition at HR, primarily is for self - development, growth and enrichment.The trend has dented the demonstrated professional credibility and commitment.The professional who keep in shifting, do not do their jobs appropriately and stayers have demonstrated the HR value proposition. Good HR Professional earns name and tremendous amount of acceptance and credibility, look at Mr. Siddique of Maruti, Mr. Arvind Agarwal, Dr. Santrupt Mishra at ABG, and so on. Ms Hema Ravi at Infosys stuck to Infosys and made positive differences. Those who stay longer contribute to the organization in pluralistic way.. Look at the Organizational HR Pyramid, instinctive rush to be at the top.. 'servicecentricity' in the structure is scantly to be found. HR people should plan, develop
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HR Managers should balance their focal points between themselves. The trend has dented the demonstrated professional credibility and commitment. Those who stay longer contribute to the organization in pluralistic way.. Look at the Organizational HR Pyramid, instinctive rush to be at the top.. 'service-centricity' in the structure is scantly to be found. Form Honest Brigade, seek volunteers, work for organization and community development.
DR. D.N. Singh (Left) with DR.T.V. Rao during conversation.
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and manage their self learning, department learning, organizational development nation development. Every HR Manager at periodic interval in their professional life - must work for Community, may be through certain NGOs and get working for them. Work periodically for rural people, destitutes and under - privileged. Form Honest Brigade, seek volunteers, work for organization and community development. Organization can think of providing 15 days sabbatical to facilitate larger goods to enterprise and social value creation. These required to be incorporated in the Job Description of each HR managers. HR Managers are required to see the Organiation from a distance, look at the organizational rules, and bend them, and re - write them. Ensure Flexibility, ensure people, product and service-centricity. Discover how the problems can be solved and smiles can be brought in. HR is unengaged in organizational and societal empirical research dimensions, carry out quick and truthful research and results. Positive influence and strike on the Emotional chord of the people for raising organizational commitment and creativity bar, how HR can bring in HR value proposition. Time has come calling to done away with homogenous & hetrogeneous policies and to move towards group-based individual policies, customized HR services, suiting the people. Do not start from restrictions, without compromising on certain key non-negotiable components. However, majority of issues can be resolved through the basket of customised HR policies. People are negotiating to work from distance, what is the problem? One can travel once in a month or on pre-engaged schedules, why to come everyday to shart at 9 AM.You work with flexibility as per our needs, we can accommodate your needs. Organizations and HR Community to reduced consultants dependence, do not outsource the core processes - Competency Mapping, Performance Coaching, Counselling, build adequate Organizational Pool of Mentors from inside, and organizations are going to derive tremendous beneifts from these perspetives. HR Managers are required to revisit schools, read books, watch movies, do recreations, work with smaller 'help-groups' find out what is happening in society and trigger the change for transformation. BM 18
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HR is unengaged in organizational and societal empirical research dimensions, carry out quick and truthful research and results. Time has come calling to done away with homogenous & hetrogeneous policies and to move towards group-based individual policies, customized HR services, suiting the people. Organizations and HR Community to reduced consultants dependence, do not outsource the core processes. HR Managers are required to revisit schools, read books.
Dr. D. N Singh works with Cadila Pharmaceuticals Limited,Ahmedabad.Can be reached at : dns65in@yahoo.co.in
Conversation
T.V. Rao on OD Present and Future The lessons from his book co-edited book (Editors S. Ramnarayan and T. V. Rao: "Organization Development: Accelerating Learning and Development; Sage India, 2011) are presented in a conversational form with T. V. Rao in this interview. Prof. Rao attempts to answer the following questions here. It is hoped that this conversation highlights the lessons from the book and points also to the future directions. Q: What do you conclude from Various OD in this part of the world? OD as a planned change with long term involvement of OD facilitator has become a trend of the past.There have been many success experiences of the past. For example Dr. Udai Pareek, Dr. Abad Ahmed, Somnath Chattopadhyay, Dharni Sinha, Ishwar Dayal and Suresh Srivastava and such NTL trained OD facilitators worked with Organizations like the L&T, LIC, Medical Mission Sisters, ICI, State Bank of India etc. now a days you rarely find this work perhaps organizations like Tata Chemicals is an exception. As Dr. Santrupt Misra mentioned, OD has come to be short-term, quick and multiple intervention based. Specialization has gone up. So a variety of consultants are used. Some of assessment centers, other for 360 a few for executive coaching and the like. With enhancement of tendering process in PSUs, Component tendering process in PSUs, Component tendering has gone up rather than integrated development and planned and guided change.These have been successful with short-term gains. While they may cumulatively do some good for the organization, and integrated approach is still welcome. I have a feeling corporation like GE still continue to have long term engagement of the OD consultants.
Q: What do you consider as some of the success experiences in your own OD work? The HRD work we had done both at L&T and State Bank of India is a success experience during that period. Recent work with Steel Authority of India and Bharat Electronics and Aditya Birla Group on Leadership Development using 360 Degree Feedback based interventions are another two examples of successful OD. Everything is time bound. What is successful today may lay foundation for tomorrow. Once it is done the corporation grows and may not even remember that someone laid the foundation. For example strong foundations were laid in SBI through its training system in initial years. Later Udai and I worked for integrated
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Conclusion of OD experiences
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rocess facilitation and OD interventions have become a part of organizational improvement and change management programs.
HRD between 1975 and 1985.There was a sustained effort and hard work. It was successful. However it has gone to the background due to intensive dialogues with officers associations, change of leadership both at top level and in HRD. I re-entered along with Prof. S K Chakravarthy in mid nineties for specific task of a subsystem change. It was not continued beyond 5 years due to change of leadership both at the SBI top level and at Government level the Secretaries handling banking.They brought in new experts who did not have a clue of the history. For them it became a year to year event than planned change. This is not to say short-term OD interventions don't work.The HRD audit as a selfrenewal mechanism, the 360 Degree Feedback as a change promoting intervention and Assessment Centers has worked well. As mentioned by Santrupt we were involved almost for a 5 year period with 360 DF in Birla Group. It was a great success as are of the inputs. In BEL we are involved in Leadership Development over the last seven years. A lot of change is taking place. A review of the work indicated both short and long term changes. For example short term it resulted in vision formulation, new product innovations and problems solving. Long term is resulted in increased openness and transparency. A two day self-renewal workshop in XIM resulted in increased focus on Vision and deciding future course of action besides faculty involvement. A diagnostic study followed by a one day feedback workshop presenting the findings resulted in consolidation and increased focus on future strategies. So was the case of survey feedback in Bharat Petroleum, Cochin Refineries and the like. In Bharat Petroleum it was used to consolidate the gains of restructuring. After restructuring was done an employee satisfaction survey was conducted.The feedback communicated to employee revalidated the gains of restructuring and pointed the gaps in HR policies and helped BPCL to initiate new HR activities. Gati is a great example of sustained work coming out of top management commitment.There 360 DF has become of regular part of self renewal. Again a quick diagnosis of the Institutional concerns and a presentation to the entire team of the findings and with Aga Khan Foundation has become a stepping stone for consolidating gains and taking the Foundation in the direction its Founders have envisaged under the leadership of Dr Abad Ahmad is a success story of how short term interventions can lay foundation to facilitate the change process.
Q: What do you conclude from various OD experiences? I think the following conclusions can be drawn. 1. The term OD is not used popularly. Like in the west OD in this part of the world has also undergone a lot of change. Process facilitation and OD interventions have become a part of organizational improvement and change management programs in India. Many of them may not even use the term OD and still carry out OD activities. 2. A variety of HR interventions have been used ranging from individual based, interpersonal and role based, group and subsystem improvement based to total 20
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variety of HR interventions have been used ranging from individual based, interpersonal and role based, group and subsystem improvement based to total system change, process facilitation and quality improvement program.
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otal system change related interventions are being used selectively using LSIP, future search etc.
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Conversation
D has become short term focused and quick-fix solution oriented. Focus on cultural change has become less important.
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D is being constantly evaluated for its effectiveness in serving the organizational good.
system change, process facilitation and quality improvement program. 3. Total system change related interventions are being used selectively using LSIP, future search etc. methods (Indian Railways, Mawana Sugar etc.) 4. OD has become short term focused and quick-fix solution oriented. Focus on cultural change has become less important. 5. OD is being constantly evaluated for its effectiveness in serving the organizational good.
Q: What are some of the challenges OD and OD practitioners face today? Execution is the major issue. Organizations seem to be highly short term result driven.They profess culture and values as important dimensions but focus extraordinarily on results and short term targets.This creates enormous difficulty for OD practitioners who like to work on long term and sustainable change. Second mergers and acquisitions have become very common. In one company the executives told me that four years ago they belonged to a different company, two years ago to a different company and since the last six months he is working for a different company. In a four year period his organization has gone through three changes. While this may be a little uncommon most organizations live with certain amount of uncertainty. Ironically when mergers and acquisitions take place that is the best time for process work as it calls for adjustments and cultural change. Under uncertainties sustained focus on values, culture and long term thinking becomes difficult. OD becomes a short term quick fix problem solving exercise than a planned change for long term. Appreciation for behavioral science based interventions and behavioral scientists have not in any way gone up while appreciation for specific techniques and technologies has gone up. For example the top management seems to appreciate the use of assessment cents for a specific group of people and at a given point of time. For example when they need to develop a group of high fliers or when they find shortage of tenant rather than making it a continuous process to upgrade talent or as a talent development tool. Same way survey feedback or 360 degree feedback, or outbound training becomes a onetime exercise to bring in process sensitivity than a continuous effort. On the positive side many technologies are being used.The OD filed has expanded to include a variety of techniques and methods. HRD and OD have come face to face.Two decades ago there used to be issues like whether OD is part of HRD or HRD is a part of OD.Today the content is not so much as what it is part of what but more on which technology or intervention works better and under what circumstances. Some organizations are using LSIP technologies and others role based interventions and while some others use Assessment centers and 360 Degree feedback and a few others HRD audit, survey feedback and vision Business Manager
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Conversation
mission exercises etc. What is being undertaken is a technology based OD rather than a change oriented value driven process sensitive OD. OD specialists as class is on the decline and specialization has gone up so much like in medicine rather than general practitioners today e see Executive Coaches, Assessment Center experts, survey feedback experts and performance management specialists. Sub system specialization has gone up. Training focus remained and continues to remain the same as before and so are the concerns.
Q: What do you think is the Future of OD and what Direction it is taking and it should take? I think OD as discipline and science deserves more attention than what it has commanded so far. Process sensitivity and Behavioral science knowledge provides the base for good OD work. We need to understand people in different settings as individuals, role holders, dyads, teams or subsystem members and organizational members and multiple role holders and mute-organizational stake holders besides citizens of a nation or products of a culture. In Asian region people are highly talented and are products of complex interactions of history, culture, families, heritage and other dynamic factors. Modern organizations and competitive world adds to this complexity. Unlike in the west where people tend to be systems driven and norm respecting in this part of the world there is no one norm or no one system to follow. People seem to respect one another perhaps a lot more than they respect systems. Given these complexities of human nature, we need to study people in their current and changing contexts more deeply before we can plan and carry out interventions for change. Unfortunately such a systematic and scientific study of people is lacking. Psychologists in this part of the world have not enhanced our insights about human beings and their motivational patterns, learning styles etc. We are still dependent on the past knowledge and knowledge from the west. It is only in the recent past attempts to learn from our Vedic culture about the nature of human being has gone up. Even this is limited to a set of hypotheses of fitting ancient wisdom into the modern organizations. What is needed in future is a systematic and scientific study of the human being and his nature in the current organizational contexts. Change and drivers of change and success stories and failure of change are required in large quantities and with more perspectives- psychological, sociological and anthropological and organizational. Only when such studies are conducted can a body of knowledge develop.The future therefore has to focus on more systematic research to discover he fundamental nature of the human being in the context of modern organizations and enhance our ability to predict behavior. Therefore there is a need for scientific base for OD. More researches need to be trained in OD. Institutions like the ISABS have got reduced some times to social networks without any scientific rigor and research base.The involvement of Institutions like the IIMA that used to happen in seventies has tremendously come down. As a result the teams of Applied Behavioral scientists that get trained or certified from these institutions have become at best factories for conducting training programs with limited knowledge.The future has to be research driven and should lay more foundation for scientific knowledge. If this does not happen OD will die its natural death and at best will be handled by a few people who lack depth and get called as OD Facilitators mainly on the basis of a few programs they attended than out of scientific study and affecting change. BM
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From a sapling to the forest:
The saga of the development of HRD in India - Udai Pareek & Dr.T. V. Rao
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his is an account of the growth and development of HRD function in India. What started in the mid 1970s as a conceptualization of an integrated HRD system to change the performance appraisal system in a large engineering company, resulted in the establishment of HRD departments in many firms. Further, dissemination and perseverence resulted in the establishment of a centre of HRD and subsequently the birth of a professional body and later, an academic institution. The authors describe the growth in eighth stages and conclude the parth for futhure is in moving towards national HR policies and other social sectors. Key words: HRD in India; HRD function: growth of HRD
The evolution and institutionalization of HRD in India is described in eight stages.
The notion of integrated human resource development (HRD) systems in India is perhaps the oldest among all countries in terms of both conceptualization and implementation. At a time when the term HRD has not yet achieved its full meaning, in early 1970s the authors of this article conceptualized this as an integrated system to drive organizational change. It was first implemented successfully in one organization, and then spread to other organizations as a mission by the authors at the Indian Institute of Management, Ahmedabad (IIMA), with the support of other CEOs and several other academicians who joined them later. What started as a system designed for one company found its way to other companies, resulted in the creation of a chairperson, the establishment of a centre for HRD at an academic institution and subsequently the formation of a large professional American Society for Training and Development (ASTD) in the USA. This essary is a personal account of the saga of introducing a new HRD function in the mid 1970s and its diffusion and institutionalization at the national level. Both singly and together, the authors have been contributing to the development of HRD in India. (Udai will be used for Udai Parkeek and TV for T. V. Rao thrughout this article).
Stage 1: The beginings (1974 - 1975) In 1973 after joining the Indian Institute of Management, Ahmedabad as the Faculty, Udai worked on the problems of reorganization in Larsen and Toubro (L&T) an engineering company. While conducting role clarification and role negotiation exercises, Udai realized the need of working on the larger issues of development of people. With TV later joining the Faculty of IIM, Ahmedabad, Udai shared this concern, and both TV and Udai decided to work on designing a new way of developing people in an organization. They presented a proposal to the Chairman Shri N. M. Desai, Chairman L&T, arranged the discussions with the top group, and accepted the proposal to try out the new system of developing people. Performance apprisal became a core system around which HRD systems were woven. Performance planning, analysis, review, coaching, development etc., became systems linked to role clarity, role efficacty, individual growth, integration, training, career development and OD activities. A number of sub systems weredeveloped and grouped into HRD. Around this time in the USA, the new term HRD was being propagated, enlarging Business Manager
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The Growth Path.... 1. The beginings 2. Spread to other Strategic organizations 3. Action research in Implementing HRD Systems 4. Dissemination begins 5. Institutionalization of diffusion of change 6. The spread of HRD network 7. Strengthening the academic base - the academy of HRD 8. The future globalization and natinalization the scope of training. The two main features of the proposed concept of HRD were that HRD dealt with all the human units of the organization (from individuals to the entire organization) and that it was value-based. The following 14 principles were shared with the organization as the guiding principles for designing the HR function. The HRD system should: (1) Help the com pany to increase enabling capabilities (2) Help individuals to recognize their potential and help them to congribute their best towards the various organizational roles they are expected to perform (3) Help maximize individual authonomy through increased responsibility (4) Facilitate decentralization through delegation and shared responsibility (5) Facilitate participative decision-making (6) Attempt to balance the current organizational culture with changing culture (7) Balance between differentiation and integration (8) Balance between specialization of the function with its diffusion into the otehrs (9) Ensure responsibility for the function (10) Build upon feedback and reinforcement mechanisms (11) Mintain a balance between quantification and qualitative decisions (12) Balance between external and internal help (13) Planned as an evolution of the function (14) Promote continuous review and renewal of the function In summary, the integrated HRD systems approach designed by us had the following elements: (1) A separate and differentiated HRD department with full time HRD staff (2) Six HRD sub-systems includign 24
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performance apprisal, feedback and coaching; potential identification and development, career development, training and OD (3) Linkages between the various subsystems (4) Designed with 14 principles in mind (5) Linked to other sub-systems of human resource function The factors of its success The implementation of the integrted HRD systems approach in L&T was one of the most successful change management experiences in the organization. Several factors contributed to the success of changes, some of which, are mentioned briefly below: Committed top The top management of L&T, including its chairman Mr. N. M. Desaai, and founder Mr. Holk Larsen, showed deep interest in redesigning the personnel system. L&T was a very successful company, and there was no apparent reason for it to think of a new system. Appointment of high-level implementation task force A high level task force headed by a general manager was appointed alongwith some of the top management team as members. The task force functioned for nearly three years, in introducing and monitoring the implementation of the system. Placement of the system at a high level in the organiztion One of the conditions the authors stated for the success of the new function was its strategic placement. Generally, at that time the personnel function was given low priority and was placed at the lower level in the organizations. This was the first company to assign a top level position to HRD in those years. The competent head of the function While selecting a person to head the new function, it was strongly recommended that a
very competent person should be given the responsibility. The CEO agreed to request a highly respecgted and competent engineer (Mr. S R Subramaniam), to head the function. Mr. Subramaniam ensured throughness and effective implementation of the various paerts of the new system. Subsequently Mr. Subramaniam became the CEO of the company. The success of the new function very much depended on the competent leadership provided within the organization. Since then L&T is a story of internal successions to lead the company. The current chairman Mr. A. M. Naik was one of the input providers to the HRD systems in the Mid 1970s. The strong internal resource No change can succeed unless there is strong and competent internal resource to implement and monitor the change. Dr. Pereira, the first to head the HRD, combined his insightful experience in the organization with his academic competence and drive to search for new ways of solving problems. Involvement of all levels of the organization The authors emphasized that the systems and processes being introduced must be discussed in various forums of employees, helping them to raise questions for any modifications in the systems as requiored. Workshops and seminars were held on the new systems and procedures. This facilitated the success of the system. Developing internal competence The company needed several people to help in implemneting the new system. It was necessary that the system and process were adopted with the help of key line managers. Therefore, an extensive training program was organized to develop relevant competencies for implementing the systems. Over 100 internal managers were developed to communicate the system throughout the company. The term 'L&T University' was used informatlly by these managers to represent the new education and learning they were facilitating through the HRD system.
introducing the system themselves ! They pronmptly appointed HRD managers who were given the task of conducting organizational diagnosis studies and revamping the performance appraisals make them HRD oriented. The implementation of HRD systems in SBI is the second most signkificant step. The authors of this article, as IIMA professors, facilitated the training of the HRD mnagers to conduct OD interventions and revamp their performance appraisal systems.
Stage 3: Action research in Implementing HRD Systems (1978-1979) It is at this time that IIMA's former director, Ravi Matthai on the board of a public sector company Bharat Earth Moverms Ltd (BEML), suggested the company should think big and expand. The company was making rail coaches and earthmoving equiopment with a turnover of 700 million rupees. Professor S. K. Bhattacharya, another professor from IIMA, worked with them and gave them a long-term plan that requiored developing human resources for making it happen. Udai gave them the conceptualization for the integrated HRD systems to move into the future. As BEML wa debating about where to get the resource to head HRD, TV volunteered to join as general manager and implement the systems recommended. Though a Defense Minstry undertaking, the BEML Chairman showed the boldness to appoint a young professor in his early thirties to be general manager and pay him the highest salaries. This is a most significant period of experimentation in a highly structured and public organization. The experiences were both successful and frustrating. The system lasted as long as TV was associated but declined a few years later when he returned to IIMA. The experiences became most enriching and laid the foundation for many insights into the implementation of HRD systems.
Stage 2: Spread to other Strategic organizations (1975 - 1978)
Stage 4: Dissemination begins (1979 - 1982)
The State Bank of India (SBI) is the largest bank in India with around 0.2 million employees at that time. The new HRD system was also developed for the bank immediately after its reorganization by the Indian Institute of Management, Ahmedabad (IIMA) team. The Chairman of SBI took personal interest. The system was recommended for SBI and its associates, and their CEOs were so excited by the new concept that they suggested taking responsibility for
Capitalizing on this experience, both authors offered the first workshop on HRD systems at the IIMA in 1979. A draft of their proposed book on designing and managing HR system was circulated in this workshop. Later a course and a series of executive development programs were started by the authors at IIMA to popularize and promote HRD. Crompton Greaves, the State Bank of IOndia and its associates, and a few other organiztions followed this initiative, and the Business Manager
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TV continued the work of diffusing HRD based change in India. Larsen and Toubro created a chair professorship in HRD at XLRI Institute jamshedpur, which was taken up by TV in 1983. Included in the conditions of his appointment as the L&T chair professor, TV gained approaval to start a centre for HRD at XLRI and to give an annual public seminar on his work.
authors worked as their consultants in introducing and implementing the HRD systems and creating new HRD departments separated from personnel. The spread of change to these strategic organizations has been well documented (Rao 2004). IIMA played a significant role in this dissemination process.
Stage 5: Institutionalization of diffusion of change (1982 - 1985) At this time, Udai went on a long consulting assignment, as USAID OD adviser to the Health Department of the Government of Indonesia: TV continued the work of diffusing HRD based change in India. Larsen and Toubro created a chair professorship in HRD at XLRI Institute jamshedpur, which was taken up by TV in 1983. Included in the conditions of his appointment as the L&T chair professor, TV gained approaval to start a centre for HRD at XLRI and to give an annual public seminar on his work. L&T hosted this four day seminar in Mumbai, where more people could attend. About 40 persons participated in the seminar which focused on recent experiences, in HRD. TV presented the integrated HRD model developed at L&T. The HR head of L&T spoke about how it was being implemented. The seminar explored what was happening and not happening in HRD: how many organizations were not able to understand the right spirit of HRD; and the helplessness of HRD managers in convincing some CEOs etc. A number of success stories were shared and there was new enthusiasm in all the members. Kin response to a suggestion from TV who was leaving XLRI to return to IIMA, the members propsoed the continuation of the initiatibve under new banner. Several suggestions were given. The discussions were steered by TV towards setting up a professional body outside the institutional gframe work of management schools (IIMA or XLRI, etc) to facilitate learning of practitioners on a continuing basis from each other, which lead to the conceptualization of the national HRD network. It was agreed that different cities should have such networks. A nesletter was 26
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initiated to disseminate the new knowledge about HRD, which would include one intellectual article by an academician; one essary profiling, in detail; the practices of a company; a few brief case studies of problems and issues that may be posed to the reader; some references and bibligoraphy; and new items. In the initial years of the newsletter, the HRD centre coordinators Fr E Abraham and T V Rao managed to get every humber sponsored by a company that was committed to HRD and had performed some good work worthy of sharing. This sponsorship covered the cost of printing 2000 copies of the newsletter and postage to all the HRD Chiefs and CEOs in the country. L&T was the natural choice as every one was talking about L&T in relation to HRD. L&T readily agreed. The seminar proceedings were published as a book. Recent experiencews in HRD, and the formation of the network was announced in 1985 through this book and the HRD newsletter.
Stage 6: The spread of HRD network (1985 - 1990) The idea of forming the HRD network was announced in the first newsletter, edited by Fr Abraham. The authors worked with the State Bank of Patalia, Indian oil, Sundram Clayton, Hindustan Petroleum, MMTC, etc., to get the newsletters sponsored and distributed free to all potential members of the new body. While Fr Abraham continued to coordinate the HRD newsletter from XLRI, TV helped in setting up the national HRD network (NHRDN) from IIMA. The South Indian Chapter of NHRDN was launched at Madras with the help of the Madras Management Association, which launched the first meeting of the chapter. Subsequently, the national HRD network was registered as a not for profit society and a charitable trust in Ahmedabad. The journey from then the next five years has been that of hard work and perseverance. No one knew NHRDN and many did not see the reason for NHRDN when ISTD was serving the same purpose. Only those who saw distinction between HRD and Training appreciated the need. The first national conference is a record of sorts. Itr had a full
day devoted to CEO presentations. While the preparations for the second conference began almost two years in advance, the preparations for the election for the next president had also begun. The director of personnel (Mr MRR Nari) at the Steel Authority of India showed a lot of support to HRD activites. Mr Nair was requested to take charge as the next President. Heading the NHRDN as a practioner and an influential person who is committed to the cause of HRD ensured the growth and stabilization of the NHRDN. The next conference at Delhi was managed by a team lead by Mr. Nair and the focus was on HRD for workmen, a hitherto neglected theme. The theme attracted the attention of most academics and practioners as well as union leaders. It b ecame a landmark conference. Udai Pareek took over as President of NHRDN after Mr. Nair and ensured both intellectual implementation and dissemination continuity. Some initiatives in governance practices helped NHRD to evolve as a vibrant democratic organization. During the tenure of the authors as president of NHRD, tro provisions were built into the constitution, one that each person would be a president for one term only and would not be re-elected. The other provision was to avoid election and search for the next president in a tem appointed by the governing board. Elections introduce politics in the procewss, and therefore, it was throught importnt to have some other modes for searching fvor the president. Subsequent presidents of the NHRDN were chosen carefully for their commitment and organizational support. Prior to their appoikntment, the support of their organizations was ensured. They came from large and well - respected organizations like RPG Group, Aditya Birla Group, etc. Mr. Arvind Agarwal and Dr. Santrupt Mishra, during their tenure as presidents, introduced another useful tradition that the search committee, after identifying the potential president, would interview the CEO of the company to negotiate release of time and energy for the candidate to be appointed as president. The provisions have made NHRD a democratic body. Today, NHRDN has over 40 chapters and nearly 20 publications to its credit. It collaborates wkith the Confederation of Indian Industry (CII) to develop HRD nmodels and assess HR professionals and also collaborates with international bodies. By any means, it has done a great service to young HR professionals. It has given oppoertunities to many young managers to test out their leadership potential and has helped a number of young professionals to acquire HR aknowledge and set their career in the right direction.
Stage 7: Strengthening the academic base - the academy of HRD (1990 - 1995) Origins The NHRDN in a Mission - Vision workshop helped in 1990 conceived a centre for research and education in NHRD to further the objectives of NHRDN. The office bearers of NHRDN decided to name it the Academy of Human Resource Development, India (AHRD). Vision, scope and activities AHRD was conceived as a place that facilitates scholarly work in HRD. A place where scholars from all over the country come foer short periods of time for research, reflection, writing, experience sharing and dissemination of knowledge. A place where seminars, workshops, round tables, doctoral and other professional development programmes are conducted covering contemporary issues. A place that should have a residential centre to accommodate abut 40 participants at a time with faculties for families to stay. An institution that brings out HRD Journals. Achievements In the last 15 years, there have been many accomplishments. Round tables, sponsored by one or a number of companies, were planned as mini conferences around a theme of contemporary signifance. It was intended to share issues and come up with implementable solutions and models for use by all participanting companies. Participantion was limited and by invitation, and sponsors were reqired to finance the publication and share experiences. Each round table (RTC) would result in recommendations, widely circulated all through the country for impact of the AHRD. The following RTCs were held; (1) Career planning and promotion policies (2) Redesigning performance appraisal systems (3) Role of HRD in restructuring organizations jointly with Delhi Management Association (4) Role of unions and associations in HRD (5) HRD for workers and empowering workers (6) Leadership for organizational excellence in the global economy The recommendations of each of these were circulated widely and published. Research fellowships In its initial years, AHRD had research fellowships sponsord by organizations. Each organization would choose a research theme of interest to them and sponsor a study that should include the salaries for six months to Business Manager
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A large number of HRD professionals were designated as HRD managers, but did not have adequate professional preparation in HRD. They needed to be developed., which was done through distance education programs. NHRDN chapters facilitated mobilizing students and offered contact programmes.
a year for a research fellow to join AHRD and work with them. AHRD developed a list of research themes, research fellows then worked on a research theme and developed a monograph for dissemination. Diploma Programmes A large number of HRD professionals were designated as HRD managers, but did not have adequate professional preparation in HRD. They needed to be developed., which was done through distance education programs. NHRDN chapters facilitated mobilizing students and offered contact programmes. AHRD also decided to extend this to other management schools like TA PAI Institute Manipal. SCM HRD Pune and IIPS Indore, and offered joint displomas to promote specialization in HRD. The ideas was to admit students wanting to specialize in HRD who could take a minimum of six specialization courses from the list supplied by AHRD. The plan was to offer technical collaboration, supply the curriculum, examine the students and certify them. One of the management schools, SCMHRD, subsequently began a one- year program in HRD and continued until, 2001 to focus more on th full-time two year program. Doctoral Program There is a need for research in HRD. HRD Managers, like other manages, are sitting on huge amounts of data. If they learn research methods and research writing, they may be able to do research and contribute to the field. In the process,m they can also get a doctoral degree. An agreement was signed between AHRD a and XLRI to start a doctoral level programme. The arrangements were as follows: (1) AHRD conducted all the courses, provided all input and managed the program both academically and financially (2) XLRI played a role in admissions, standards, approval of proposalsand thesis examination to ensure standards. (3) AHRD admitted students, organized the guides, conducted contact programmes (two programmes of six weeks duration 28
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covering six courses each), organized thesis proposal presentations and guided students (4) The fellowship was to be awarded jointly by AHRD and XLRI, and tnhey were be called XLRI - AHRD Fellows In all, 75 candidates were admitted, and about 25 completed their hip program by the time the arrangement with XLRI ended in 2006. When XLRI preferred to focus on its own programmes. Some of the graduated candidates are working as faculty staff at IIM Indore, XIM Bhubaneshwar, ASCI, etc. The professionals appreciated the quality of the candidates' thesis work. Work in social sector AHRD decided to extend its work within the non for profit sector. The objective was to develop the non governmental organizations' (NGOs) capabilities through self-renewal methodologies. The objective was to develop an NGO newtwork and develop self-renewal capabilities for the development agencies. AHRD started a journal, Renewal, supported by EZE Germany. The first issue was brought out from Ahmedabad. The second was issued from Hyderabad but was subdseqiuently dropped owing to a lack of committed editors. Learning resources centre (knowledge management centre) During the earlier years of HRD, many associates donated their collection of books, material and data of practices. The applications received by NHRD for annual HRD award used to be compiled and included nt he best practices databas3e of AHRD. Many instruments were collected and a data bank of HRD tools was instituted. A data bank of HRD Practicews of companies was also instituted. All these from Indian universities dealing with HRD were collected. The library was built as a unique collection of all books and monographs in HRD. A number of students from various colleges and institutions of Hyderabad used the centre. An individual and organizatinal assessment centre (IOAC), as a new concept of
AHRD, was initiated. The concept was to provide an opportunity to HRD managers to renew their roles by focusing on development through assessment. The concept was developed in Ahmedabad and Dr Sethumadhavan was recruited to take charge of this in 1995. He provided leadership and direction to this centre for three years. IOAC was defined as a centre set up by an organization for continuous assessment of the competencies of indviduals, dyads, teams, groups and organizations. The IOAC was designed to focus on organizational and team assessments besides the individual assessment done in the traditional assessment centres. A conference taking stock of the experiences of organizations conducting assessment centres was organized in Mumbai in 1999. A book on assessment centres was planned and a manuscript was sent to Sage. Unfoertunately the book was never published due to internal coordination issues. A number of in-basket exercises were developed. Consultancy services in assessment centres were offered to various organizations. AHRD contributed a great deal so far to human capital formation amongst HRD professionals in India. However, there was much more scope. AHRD cold have been a globally recognized institutioon and consdiered as one of the main places for scholars across the world to visit. The great dream still remains a dream; the great dream was to have a campus, data bank and library, and furnished residential accommodation for scholars to visit, write, renew and disseminate their work. The relevance and need for such an institution still exist today. Its doctoral programme could have become a flagship programme and would have contributed a great deal to HRD knowledge.
Stage 8: The future globalization and natinalization (2008 - ?) In the last 20 years, NHRDN has grown vastly. The seeds for its growth were sown and the foundation was laid in the first three years. The agenda of learbning from each other continues. The annual or biannual conferences and the chapter meetings for learning from each other and networking continued. The chapters have grown in number. The culture of publishing papers to be distributed during conferences continues. However, a few more things could be done by NHRD: (1) Setting standards for HRD profession and creating curricula and accreditation methodologies
(2) Creating assessment tools and rating methods in HRD for individuals and corporations (3) Building AHRD as a much stronger research institutions, as there is no other institution in India devoted exclusively to HRD research (4) The future of th\e HRD movement in India is in realizing that we have not even touched the most important sectors like education, health, infrastructure, government et., where HR interventions are most needed. We need to pay attentkion to these strategic sectors. The spirit of HRD lies in learning from each other; teachers, managers, doctors, nurses, in fact all citizens involvewd in the pursuit of change and development. (5) The future focus also should be on globalization and learning from experiences from other countries. Participating in world events, and sharing and disseminating a lot of knowledge being generated in India, is the next natural step. This account of the success story of the HRD movement in India indicates how a few committed individuals with sustained effort and perseverance can create a concept and turn it into a movement. The conceptualization of HRD as an enabling function and an essential part of organizational growth and human devewlopment on the part of a few individuals leads to the establishment of HRD in India. However, the profession and the body have along way to go. Those involved in the HRD movement in India need to s step out to know how HRD is a national policy issue and how they have not touched even a small part of the humanity and that the HRD mobvement is incomplete if it is confined to the corporate sector. It cannot ignore the billions of people who need to improve their longevity, skill base, income, health and quality of life. The authors continue to work on these issues but unless a body like the NHRDN takes up these issues, integrated HRD may remain beneficial only to industry and to the humanity at large. Acknowledgements This paper has borrowed heavily from 'My Institution Building Experiencews at IIMA, NHRDN and AHRD (A reflective essary in honour of Prof. Ishwar Dayal) by T V Rao. BM References: Late Prof Pareek Udai and T V Rao, 1998 Pionnering human resources development: the L&T system, Ahmedabad: Academy of Human Resource Development Rao T V 2004: Future of HRD, New Delhi: Macmillan. (The article was published in Human Resource Development Internation Nov. 2008. Published now in India for the first time.) Business Manager
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SURROGATE HR
A Conversation with Self‌. I always like to watch the performance of a street magician. He performs his tricks, he entertains and pulls passerby as well with his own charisma. 'What is this?' the magician shouts with an empty match box. 'What value does it have?' Crowd is silent now. He opens the box again.There is a match-stick inside. 'What does the combination possess?' It can create fire - someone from the crowd responds. Few children start clapping to show their approval. 'Fire has the potential to ignite an inflammable material that can produce heat & smoke', the magician is narrating with extreme enthusiasm.There is an expectation in the audience for an act that provides them with bigger surprise. 'What is this?', he now shows an incense stick to the gathering. 'What is the value of the combination of all three entities, a match stick, a match box and an incense stick. 'It can produce fragrance when the match stick strikes the side space of the match box and the fire burns the incense stick', the same person, probably his own man in the crowd speaks out loudly. I silently move out of the game arena. Match box is the organization space for a human who is a basically a valuable match stick.When the value observes the patterned striking space of the organization, it ignites & in the stillness of NOW, a state of awareness is born from which excellence is released. State of awareness is the incense stick, which is located beyond the limited arena of a match box but filled with the potential to do wonders. Now the magician is performing the act of creating a fire & burning the incense stick. From a distance, I hear the clapping of the children.The show is perhaps over by now.
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re-2000 world has taught us to stick to processes and capital but the emerging world of concepts stresses more on innovation & collaboration. The shift of thought is the basis for the change. However, faith on the old that is nurtured for decades tries to block the entry of the new. A human being possesses enormous power as he is always anchored with his feelings in the World Within. Without is a space for him to manifest the dream in material equivalent format. In organizational perspective, the power of dream has to be captured with a completely different approach. Surrogate HR is a view to gain an insight into human as a variable to make up the organizational workforce. It works as a substitute to conventional HR with the intent to elucidate that human is not limited as an entity in the environment. He can create anything in his thought first. He houses a developing embryo within himself to bear the fruits of an organization. The outlook allows an evolving business space to arrest human with his inherent possibilities. Human ate the apple for the first time & his existence got restricted mostly in his thought forms. He tried to find his enjoyment in the duality of life thinking that the future would bring the happiness for him. Life started moving from past to the future & NOW, the present gradually lost its importance. His excuses to become happy started coming from his projection of the things in the future. Thinking mind became stronger; comparison with others for own happiness gave way to competition - you have a better body which I do not have, you have a beautiful wife which I do not possess. In this game of oppositions, human mind emerged as the controlling entity. Now, in this material dominated world success is determined by how much we compete with each other, whereas human existence first came into being for expansion & creation, and not for competition. Every day, I spend a couple of hours with those beautiful minds in the university innovation lab. It is really difficult for young students to understand the difference between a state that is novel & original and a state that is old & rhythmic. Innovation is a product of earlier state but repetition is the outcome of later. A conditioned mind cannot see through the gaps of thoughts but 30
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an innovative mind can reach the abundance of intelligence when thoughts dissolve. They have been using a few words in between their expressions which are closer to the state. But I watched very closely how those words have been taking turns midway without reaching the space of realization. They are really influenced by what they apparently observe through the mental noises mind creates every moment of daily life. An innovative mind affirms the original qualities of human where wrong sense of self is observed all the time. I am not the chair I occupy as I go beyond that in order to reach my state of purity; I am a pure energy body. Can a human access excellence inside an organization without the realization of the bigger picture? Excellence is a manifestation in the mix. Organization houses human resources together with common value system that orders harmony & interpersonal relationships. Professional space is a state of awareness that can release excellence. The setting is transparent and the organization works as a continuously evolving entity as individuals remain connected to the infinite intelligence in their eternal professional journey. Innovation and collaboration become the new expression tools for individuals who get empowered with this awareness of all his connection. But in the journey, he likes to enjoy his own freedom to discover his own cravings & urges. With a passion to search deep within he wants to paint a big picture for himself and his organization. For him, education is a means & vehicle for personal development but continuous learning is a professional flow. The means formulates aspiration & practices to entail human feeling and the flow adjusts the view to appreciate living in the material world. There are celebrations and festive moods when human receives the needed freedom to choose & contribute in his own domain. He can feel interesting sensations in his own life story and observe beautiful formations in the organization he works for. The wonderful shades of colors, tunes in him conquer the mental noises created by the old; chattering of voices from the past gives way to the newness in the NOW. Wow! what an amazing feeling it is, he is reborn again as a human being! BM How can an organization provide that? We will search the answers in this column‌.
'Surrogate HR' tries to capture a part of human development that has never been conceived by HR. It is the story of human expansion that can only stem from abundance with the sense of plentiful.
Chinmoy Sarkar Author, AXELL
Mihir Gosalia Mumbai
Skills of getting things done Skill & intellect alone is not enough. The employee also needs to possess a know-how to get things done within an organization.
Important Skills •Organizational savvy •Relationship building •Ability to read the climate •Ability to read important timing
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kill and intellect are important attributes that an employee needs to get the work done that is his responsibility. However skill & intellect alone is not enough. The employee also needs to possess a know-how to get things done within an organization, the employee should be able to understand how things work in the organisation, what is the type of work climate prevalent in the organization. Knowing how to get things done within an organization often requires the employee to have an understanding of the internal working of the organization i.e. not just the rules & regulation or company policies, but having the suaveness to gain sponsors for ideas, get people to buy in to one's proposals, a keen sense of timing, and an understanding of the who's who of decision making. Being organizational savvy is defined as the ability to understand and turnaround things in your favour within the organization to get the work done. Being organizational savvy implies being centered on understanding the professional culture the employee is working in and working with it - instead of against it - to achieve his goals. It is understanding that 'office politics' is a reality to be dealt with, not ignored or even looked down upon. Whenever two people get together for work purposes, there is bound to be 'politics' at play. This skill is very important in certain jobs especially those that require leadership abilities, leading teamsand change management initiatives. To cite an example, when implementing new systems or processes within the organization because that is the requirement of the hour for the organization due to changing external environment, market demand, due to competition, etc... This task requires managing change. This task requires everyone involved into the new system or process being implemented to change from their old method or style of working to Business Manager
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the new one being laid down or implemented. This is as good as a change in the system or method of working. This would mean newer things to do that would have been never done before do, additional responsibilities, change in reporting structure, etc‌For this to happen, one has to first gain acceptance, the idea needs to be "sold" to those whose decisions & participation in it matter the most, there should be buy-in from all involved that this is acceptable to them and that they see benefits from the change in systems being implemented.If that is not done, then implementation will not be an easy journey. There would be many hurdles faced in the path. Being organizational savvy is one of the defining competencies of effective senior leadership. Employees who lack it may drive results for a short period of time through force of will or for their own personal agenda. However in order to get long term sustained effectiveness, it can only come from an aligned organization working towards a common vision. Organizational savvy is a fundamental skill for creating such an organization and is an essential leadership skill. Organizational savvy skills are developed over a period of time when one has worked in different cultures, different work environment, maybe even within different departments in a large organization, etc‌These skills cannot be gained overnight nor one has inherited them.The employee should have an understanding of how to approach other people or key members within different functions of the organization, and also that the person approached is part of an overall strategy to gain support. The employee should have the ability to differentiate between individuals, why certain individuals are key individuals and what methods or tactics can be used to gain an individual's support. The employee should also be able to recognize that each idea is different and may require a different approach to move it forward. Relationship building skill is another important attribute that the employee must possess in order to get the work done within 32
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the organization. By relationship building, it means having the right contacts that extend across the organization and knowing how to get support from other colleagues for getting the work done. The relationships should be genuine and should be supported by a wide range of people who are willing to help. These relationships should not be based solely on the attitude of "I'll support you if you support me." It is not the right way to create true teamwork. The relationships should be more genuine and should be based on mutual trust and respect. Possessing strong ethics is very important here. In order to be successful, the employee needs to develop & gain trust from his other office colleague with whom he has to work together along. The employee should also possess the ability to read the climate within the organization or even within a meeting in order to be able to assess timing, opportunity, and key players. For example, if in a team meeting about bringing ideas to fruition, to discuss enterprise-wide improvement ideas, if the tone in some of those meetings of the senior leaders was rushed or negative, then wisdom says that it is not the right time or the situation is simply not conducive to the climate needed to "sell" an idea or initiative. Timing is the key here. It is important that the employee possess the ability to read important information about the climate before advancing his ideas.Start by understanding the organization's culture, or its attitudes, experiences, beliefs and values. For example, is it collaborative or confrontational? Is it long term thinking or short term thinking oriented? Is it conservative or not conservative? Getting to know the core working style of the organization is a crucial step to becoming organizational savvy. Those employees who are organizational savvy are effective at creating results - for themselves, their functional work areas, cross-functional projects and for the entire organization. Individual effectiveness can only go so far - being organizational savvy is required to achieve broader results that are consistent with the goals and culture of the organization. BM
Mansi Madan New Delhi
Chicken Shorba for Employer Soul Employee is the one who if puts his heart with his labour in his work, finds soul in the work and brings laurels to the organization. And the one who does all this is usually the one with a perfect fit.
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mployees are the real capital of any organization. They have the power to either make or break the organization. You might have the state-of-art facility, world's best automatic machines installed in but even to start that piece of metal, you need a human. And most of all, you need a human mind to think and make use of that finest bit of machines, tools and equipments. Advent of technology might have brought so much ease to our work and have led to a sharp dwindle in the need of manpower but we must not forgot, that nothing can replace a human mind. A CNC machine might help you in producing 100 LED screens in an hour but it takes a human mind to come up with a breakthrough idea like LED Screen or even CNC Machine. Employee is the one who if puts his heart with his labour in his work, finds soul in the work and brings laurels to the organization. And the one who does all this is usually the one with a perfect fit. Organisation fit or P-O fit, the compatibility between a person and the organization, emphasizing the extent to which a person and the organization share similar characteristics and meet each other's needs (Kristof,1996). Job fit or P-J fit, the match between the abilities of a person and the demands of the job or the desires of a person and the attributes of a job (Edwards,1991).Hence, a truly motivated employee. And this is what you get from a motivated employee:
It's a magical cycle. Ram a fully motivated employee, enjoys his work. Everyday, he leaves well on time for his work from home in the morning, ever enthusiast. He not only finds pleasure in his work, but also believes in his organization as a whole. He makes lot of friends with his likeminded peers. With so much content and faith all around, he is willing to go that extra mile for his work. He takes initiatives, accepts challenges and learns from his mistakes. In the evening, he goes back home and his family is happy too. They understand and take his organization as their extended family. Even when sometimes he is late, his family understands. And the Organisation on other side grows consistently. Business Manager
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Chicken Shorba for Employer Soul
So what does it take to have a motivated employee these days?
An Organisation with: Beautiful Mind ( clear and attainable goal) Healthy Heart (who can understand employee, its needs, dreams, ‌) Warm Soul (positive environment and nurturing culture)
Beautiful Mind:
An employee of this era, is not just concerned about their own domain but for the organization as a whole. It's the time of dual mastership MBA Grads, Engineer CAs and PHD writers. The education has opened its wings and people have expanded their horizons. An employee in Finance department wishes to know the marketing philosophy of the organization. And so, how are marketing department employees selling and getting in moolah to the company? An employee wishes to know, what is his Organisation's objective? Mission? Vision? Market Value? What does it wish to attain? And how? How well have they conquered till now? And how about in future? And then, an employee's final decision depends on, how well does all this, sets in with his individual's principle? Today's employee is ready to improve upon but not ready to go lower down in his principles. He holds his self-esteem, selfprinciple and self- respect higher than anything.
Healthy Heart:
Emerging Employees hold their head with one and heart with another hand. Where it's important to take care of your principles it's equally important to pursue your dreams. Employee spends nearly 45% of his time at work, so the concept of organization as your second family is taken quite seriously now. So, an employee wishes for an emotionally Intelligent Employer. An Employer, Who understands his employee like a friend, guides him like a mentor. An employee of "Generation Y" is a free soul, fearless, passionate and a dreamer. Fearless to go their ways, passionate towards their work and dreamer. And if all
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of these qualities positioned in right direction, can move mountains. Employees of today our more outspoken than ever before, they are bold enough to put in their views and ready to face repercussion, if any. Ready to put in their soul in their work, with work comes demands' from employers, like: A word of praise on good work done, A mentor to hold on and guide, in state of crisis,( personal as well as professional crisis) A coach rather than a boss as a superior, Job Security, Clean and safe environment. And, an environment of learning and growing over same old office politics.
Warm Soul:
What is more appealing, a small room with a cozy bed and a rocking chair or a grand room with dilapidated bed and a majestic chair? Another one, a small cottage with small but cozy bed and a peaceful sleep or a splendid mansion, with all the luxuries but no time for a thing? You might be paying your employee a seven- figure salary, but if you are keeping him on rocks, he wouldn't enjoy his work and so wouldn't stay long. On the other hand, an employee might be withdrawing just five- figure salary but if he is well taken care of, would stay on and do a great job. Warm, understanding and nurturing work culture is as much important as physically and esthetically appealing surroundings. We might have conquered moon and stars, we might have built nuclear bombs of mass destruction but we have not lost our hearts. An employee of today might not take his boss as his father but he still craves and respects the generosity, experience and a warm soul. P.S. An employee may join in even when the above mentioned things don't match. In that case, sticking on/ employee retention could be quite a grave concern. BM
Government Notifications
Revised Minimum Rates of Wages Delhi w.e.f. 1.10.2011 F.12(142)/11/MW/Lab/3650
Dated : 31.10.2011
ORDER
1. Whereas the Government of National Territory of Delhi, had last revised the minimum rates of wages in Scheduled Employments under the Minimum Wages Act, 1948 in the National Capital Territory of Delhi vide notifications No. 12(142)/11/MW/Lab/2023-47 dated 26.7.2011. 2. And whereas, in the abovementioned notification it was stipulated that the Dearness Allowance will be payable on the basis of six monthly average index numbers of January to June and July to December, on 1st April and 1st October respectively. 3. And whereas, now, the Government of National Capital Territory of Delhi after adjustment of the average Consumer Price Index Number for the period from January 2011 to June 2011 which is 186.67, an increase of 6.17 points, hereby declares the following Dearness Allowance which shall be payable for all categories w.e.f. 1.10.2011. 4. The following rates are applicable in respect of unskilled, semi-skilled and skilled categories in all scheduled employments except employment in 'Shops and Establishments' and employment in 'Clubs'. Category
Rates as on 1.4.2011
Dearness Allowances w.e.f. 1.10.2011
Rates from 1.10.2011 (Rupees)
(Rupees)
(Rupees)
Per month
Per day
Un-skilled
6422.00
234.00
6656.00
256.00
Semi Skilled
7098.00
260.00
7358.00
283.00
Skilled
7826.00
286.00
8112.00
312.00
5. The following rates are applicable in respect of unskilled, semi-skilled and skilled categories in (i) Employment in Shops and Establishments (ii) Employment in Clubs, Which are as follows : Category
Un-skilled
Semi-skilled
Skilled
Rates as on 1.4.2011
Dearness Allowances w.e.f. 1.10.2011
Rates from 1.10.2011 (Rupees)
(Rupees)
(Rupees)
Per month
Per day
(i) 6422.00
234.00
(i) 6656.00
(i) 256.00
(ii) 6297.00
(ii) 6531.00
(ii) 251.00
(iii) 5628.00
(iii) 5862.00
(iii) 225.00
(iv) 5521.00
(iv) 5755.00
(iv) 221.00
(i) 7098.00
(i) 7358.00
(i) 283.00
(ii) 6973.00
(ii) 7233.00
(ii) 278.00
(iii) 6304.00
(iii) 6564.00
(iii) 252.00
(iv) 6197.00
(iv) 6457.00
(iv) 248.00
(i) 7826.00
260.00
(i) 8112.00
(i) 312.00
(ii) 7701.00
286.00
(ii) 7987.00
(ii) 307.00
(iii) 7032.00
(iii) 7318.00
(iii) 281.00
(iv) 6925.00
(iv) 7211.00
(iv) 277.00
(i) Where neither meals nor lodging is provided (ii) Where only lodging is provided. (iii) Where only meals twice a day is provided (iv) Where both meals and lodging are provided. 6. The following rates are applicable in respect of Clerical and Non-Technical Supervisory Staff in all Scheduled employments : Category
Rates as on 1.4.2011
Dearness Allowances w.e.f. 1.10.2011
Rates from 1.10.2011 (Rupees)
(Rupees)
(Rupees)
Per month
Per day
Non-matriculates
7098.00
260.00
7358.00
283.00
Matriculates but not graduates
7826.00
286.00
8112.00
312.00
Graduates and above
8502.00
312.00
8814.00
339.00
(Piyush Sharma) Joint Secretary (Labour) Business Manager
January 2012
35
Government Notifications
Minimum Wages in Chandigarh w.e.f. October 1, 2011 to March 31, 2012 Category of workers S. No.
All Scheduled 43 Employments
Unskilled
Semi Semi Skilled I Skilled II Highly Skilled I Skilled II Skilled
Class I (Staff)
Class II Class III (Staff) (Staff)
Basic Minimum Wages Per day (in Rs.) 234.3
243.92
240.07
260.26
251.61
275.65
264.5
250.65
244.88
Hotels, Restaurants, Tea Stall and Halwais Category of workers S. No.
Schedules of Employments
Unskilled
1.
Without Food and Lodging
2. 2.
Semi Semi Skilled II Skilled I Skilled II Skilled I
Highly Class III Class II Skilled (Staff) (Staff)
Class I (Staff)
In Rupees Per month 6092
6242
6342
6542
6767
7167
6367
6517
6877
With Food and Lodging
5330.5
5461.75
5549.25
5724.25
5921.13
6271.13
5571.13
5702.38
6017.38
For Food and Lodging
761.5
780.25
792.75
817.75
845.87
895.87
795.87
814.62
859.62
Minimum Wages in Punjab w.e.f. 1-9-2011
Unskilled 4016
Semi Skilled
Skilled
Highly skilled
4002(A)
4458(A)
5001 (Lower)
4361(B)
4745(B)
5191 (Upper)
The Employees' Pension (Amendment) Scheme, 2011
Vide the Gazette of India, Extraordinary, Pt.II, Sec.3(ii), issue No. 1515, dated the 5th August, 2011, at p.1 Dated : 5th August, 2011 S.O. 1809(E).- In exercise of the powers conferred by section 5 read with sub-section(1) of section 7 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952), the Central Government hereby makes the following Scheme, further to amend the Employees' Pension Scheme, 1995, namely :1. This Scheme may be called the Employees' Pension Scheme, 1995, namely :2. It shall come into force on the date of its publication in the Official Gazette. 3. In the Employees' Pension Scheme, 1995,(i) in paragraph 20, after sub-paragraph (4), the following sub-paragraph shall be inserted, namely :"(5) Every employer shall send to the Commissioner, an electronic format of the returns referred to in sub-paragraphs (1) and (2), in such form and manner as may be specified by the Commissioner."; (ii) in paragraph 39-A, after the words and figure "Commissioner in Form I", the following words shall be inserted, namely :"and such return shall also be submitted in electronic format in such form and manner as may be specified by the Commissioner." 36
Business Manager
January 2012
The Employees' Deposit Linked Insurance (Amendment) Scheme, 2011 Vide the Gazette of India, Extraordinary, Pt.II, Sec.3(ii), issue No. 1515, dated the 5th August, 2011, at p.2 Dated : 5th August, 2011 S.O. 1810(E).- In exercise of the powers conferred by section 5 read with sub-section (1) of section 7 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952), the Central Government hereby makes the following scheme, further to amend the Employees' Deposit Linked Insurance Scheme, 1976, namely :1. This Scheme may be called the Employees' Deposit Linked Insurance (Second Amendment) Scheme, 2011. 2. It shall come into force on the date of its publication in the Official Gazette. 3. In the Employees' Deposit Linked Insurance Scheme, 1976,(i) in paragraph 10, after sub-paragraph (2), the following sub-paragraph shall be inserted, namely :"(3) Every employer shall send to the Commissioner, an electronic format of the returns referred to in subparagraphs (1), (1A) and (1B), in such form and manner as may be specified by the Commissioner."; (ii) in paragraph 28, after sub-paragraph (7), the following sub-paragraph shall be inserted, namely :"(8) Every employer shall send to the Commissioner, an electronic format of the returns referred to in clause (ii) of sub-paragraph (1) and clause (ii) of sub-paragraph (4), in such form and manner as may be specified by the Commissioner."
Labour Problems & Solutions
Anil Kaushik, Management Expert -HR & IR
Solutions provided here are in context to narrated facts & not in general.
Q. There is no clarity about coverage of workers under ESI, engaged by job contractors / out side agencies in connection with the work of principal employer specially when the work is completed out side the premises. Can you please clarify the confusion and state exact position of law? Ans. On the basis of various High Courts like Madras, Madhya Pradesh, Karnataka & even Supreme Court, ESI Corporation vide its circular issued in Oct., 2007 has clarified the position. In case where job work done inside the establishment premises through contractor, who also has his own independent ESI code number, there is no confusion and ESI will be applicable on such job work but it will not be claimed from principal employer and only from contractor inspite of the fact that here supervision of the principal employer is implied. In case where job work done inside the establishment premises by a contractor who does not have his own independent ESI code number, principal employer will be responsible for ESI compliance in respect of employees engaged by job contractor. Here also supervision of the principal employer is implied. Principal employer has to ensure that ESI contribution is properly deducted and paid on behalf of the job contractor. In case where job work is done out side the factory premises through factories / establishments which are having independent ESI code number, principal employer is not involved here for compliance of the ESI provisions in respect of employees employed by such out side factories / establishments. But as a matter of precaution, principal employer should keep the ESI code number of such establishments with them for ready reference. In case job work is done out side establishment premises through such factories / establishments / contractors which are not having independent ESI code number but on such job work supervision is exercised by the principal employer, such employees involved in job work through out side factories / establishments contractors will be covered under ESI by the principal employer because here the element of supervision by principal employer is important. Courts have also defined the element of supervision. Supreme Court in the case of CESE Ltd. vs. SC Bose and other (civil appeal no. 3197-98 of 1988: SC) has held that where the employee of out side agency is put to work under the eye and gaze of principal employer where he can be watched secretly, accidentaly or occasionally while the work is in progress, so as to scrutinize the quality thereof and to detect faults
therein, and also put to timely remedial measures by directions finally leading to completion of work will amount to supervision. The right of the principal to reject the finished products after the work is over would not alone constitute supervision. In case where the job work is done out side establishment premises through the agencies exclusively for the principal employer but engaging less than 10 employees, principal employer will be responsible for ESI coverage of such employees. In case where the job work is done by the out side agencies employing less than 10 / 20 employees which are not independently coverable and also no supervision of principal employer is excersied, such employees of job contractor will not be covered under ESI. In case where the job work is done out side the factory premises by job contractors through the employees who are home workers or works in non implemented area, ESI will not be applicable. Q. Few workers in our organization have committed serious misconducts related to sexual harassment and moral turpitude. Management is not inclined to go into the process of charge sheet and enquiry and want to dismiss them straightway. How far would it be legally sound and whether management would be responsible to prove the charges against such employees in the court? Ans. Yes! In case management decides to dismiss the services of the employees straightway due to certain misconducts, it will be the sole responsibility of yours to prove the charges in the court of law. You should also evaluate the practical side of the situation. After years when probably officers / employees related with the case might have left the organization how management would prove the charges? The complainant also may not be available to the management for giving evidence in the court at future point of time. Supreme Court in the case of Amar Chakravarty and others vs. Maruti Suzuki India Ltd., 2011 LLR 1 has also held that when management dismisses the services of an employee straightway without following the procedure, it will be the responsibility of the management to prove the charges in the court of law. I suggest you to go by the process, issue charge sheet, conduct inquiry and then dismiss the employees if charges are proved. In all practicabilities, it will be easier for the management to prove the charges now before inquiry officer than in the court of law after years. Business Manager
January 2012
37
Labour Problems & Solutions
Anil Kaushik, Management Expert -HR & IR
Q. We have come to know that one of our sales employees has committed fraud and financial irregularities thus bringing a bad name to the company. He has been working with us for last fifteen years. Management is in no mood to pay him gratuity and wants to forfeit the gratuity amount. How should we go about this and whether it will be legal?
has also held that when a voluntary retirement scheme is introduced and the management reserves the right to retain the efficient employee / officer, it can’t be questioned and termed as pick and choose policy. Court held that it was a legitimate decision of the management in rejecting the VRS of an employee who in the eyes of the management was a talent and needed to be retained.
Ans. Payment of Gratuity Act provides the provision entitling the employer to forfeit the gratuity payable to an employee whose services have been terminated for any act, willful omission or negligence casuing and damage or loss to, or destruction of, property belonging to the employer, to the extent of the damage or loss so caused. It can also be forfeited if employee is terminated for his ritous or disorderly conduct or any other act of violence on his part or for any act which constitutes an offence involving moral turpitude, provided such offence is committed in the course of employment.
Q. We have our head office in Delhi and different branches / showrooms / sales offices all over the country. Few branches / showrooms profits are more in comparision to others. My question is can we calculate and distribute the Bonus at different rate of percentage to different branches / showrooms /sales offices depending upon their profits earned? We also make independent balance sheets of each office.
It is clear that in order to forfeit his gratuity, first you need to terminate his services after charge of fraud are proved. HP High Court in the case of Manmohan Prasad vs. HP State Small Scale Industries and Export Corporation Ltd., 2011 LLR 177 has also held that gratuity of an employee can’t be with held without complying with the principles of natural justice. Q. I want to know your expert opinion on the point, whether gratuity will be payable to an employee if he is appointed on fixed term basis for one year initially and his contract is extended from time to time thus completing five years of service? Ans. Yes! Such employee appointed on the fixed term basis and contract extended from time to time, will also be entitled for gratuity under the provisions of Payment of Gratuity Act. Appointing an employee on fixed term basis is only a mode of employment and such system can’t be allowed to curtail the rights of employees. All. HC in the case of U.P. Bhumi Sudhar Nigam vs. Appellate Authority, 2011 LLR 164 has also held that an employee even when engaged on contract basis satify the conditions of the Payment of Gratuity Act will also be entitled for Gratuity. Q. We propose to introduce VRS in the organization but at the same time we also want to retain the good employees and allow under performers to go. I have confusion in this regard. Can we introduce such a VRS which allows management to exercise discremination in selecting the employees for VRS. How should we go about in this matter? Ans. You should not have any confusion in this regard. Management has full discretion and anthority to select the employee for VRS. It all depends on your VRS conditions. I suggest you to put a condition in VRS that management will have absolute discretion subject to reasons either to accept or reject the request of the employee seeking voluntary retirement. Through such process you can select the employees for VRS and it will not be deemed as discremination. SC in the case of Chairman & MD, Indian Overseas Bank vs. Tribhuvan Nath Srivastava, 2011 LLR 225
Ans. Yes! Depending upon the Profit & Loss Account of each branch office / sales office / showrooms, you can declare / calculate / distribute the Bonus at different rates, instead of overall balance sheet prepared on the basis of Profit & Loss Account of the whole establishment / company. Madras HC recently in the case of Management of India Tourism Development Corporation, Madras vs. General Secretary, All India ITDC Employee Union, 2011 LLR 272 has also held that under Payment of Bonus Act, the departments and branches having seperate balance sheets are to be treated independently for calculation of bonus and can be paid at different rates as per sec. 3 of the Payment of Bonus Act. In this case the corporation was having duty free shops at different places at all India level and paid bonus at different rates to different shops employees depending upon their profits. Court held it legal. Q. One employee has used filthy and abusive language to his female supervisor when she asked him to be in discipline and punctual in duties. Female supervisor though has complained against the male employee but has avoided writing exact language and abuses in her complaint. Please advise should we go ahead with this complaint or ask her to narrate the abusive language? What would be the fate of such termination if abusive language is not narrated in the charge sheet? Ans. My opinion in this matter would be that you should persuade the female supervisor to narrate / give some details of abusive language in her complaint against the male employee. It will strengthen the charge sheet and will also be out of ‘vagueness’. It is the basic principle of natural justice that employee should know what are the charges against him. If details of abusive language is not given in the charge sheet, it will be difficult for the management to assess the gravity of the charges of abusive and filthy language. All. HC in the case of U.P. State Tranport Corporation vs. Sudhir Nigam, 2011 LLR 361 has also held that termination of an workman for using abusive language towards his superior will not be sustainable in the absence of indication of some words, language, or gestures which may be used to be treated as abusive to justify the punishment as imposed by the management.
Readers are invited to ask for Solutions of their Labour Problems through e-mail - bmalwar@yahoo.com 38
Business Manager
January 2012
From The Court Room
Latest Judgments
Recent Important
Judgments
Back Wages Back Wages on reinstatement would be proper when the employee was dismissed solely on the basis conviction by a criminal court and his conviction was set-aside by higher court. Award allowing only reinstatement and denying back-wages to a Bank employee, who has been removed from service only on the ground that he was convicted under Section 498A of IPC for causing cruelty to his wife by the lower court but conviction was set aside by the Appellate Court, is quashed holding the petitioner also entitled to back-wages for the period he remained out of service as he was removed from service without conducting departmental proceedings against him by the bank. Mohammed Abdur Raheem vs. State Bank of India and Another. 2011 LLR 1237 (Mad. HC)
Court Powers Stay order of termination of a peon appointed on contract basis is illegal. Engagement of an employee on contract basis does not vest on him any legal right to regular appointment. Giving full relief through an interim order is illegal being without application of mind. Mukhiya Karyapalak Adhikari, U.P. Khadi Tatha Gramodyog Board Karmit Anubhag, Lucknow & Anr. vs. Santosh Kumar. 2011 LLR 1235 (SC) Court not to interfere with the punishment of dismissal order when driver was found drunk and used filthy language and misbehaved with the passengers. Labour Court has rightly declined to interfere in the punishment of dismissal of the workman (bus driver) who has been guilty of misconduct while driving under the influence of liquor, picking up quarrel and misbehaving with the passengers. High Court will not interfere with the Award of the Labour Court when sufficient material has been placed against the bus driver. A. Chandrappa vs. Management of Bangalore Metropolitan Transport Corporation. 2011 LLR 1277 (Karn. HC)
Labour court is required to give adequate reasons while denying back wages on reinstatement when termination was found illegal. Denial of back-wages, on reinstatement to a workman whose services have been illegally terminated, without supporting reason by the Labour Court, needs fresh decision to the extent of back-wages by remanding the matter back to the Labour Court. Pramod Singh vs. Divisional Forest Officer and Others. 2011 LLR 1242 (MP HC) In lieu of reinstatement and back wages, compensation of Rs. 10,000/- is too meagre. Enhanced to Rs. 75,000/Award of Rs. 10,000/- compensation in lieu of reinstatement is too meagre amount. Hence, amount of compensation is enhanced to Rs. 75,000/-. The amount awarded by way of lump sum compensation is too meagre, more particularly, when she (petitioner) was to reach the age of superannuation on 7th July 1999, she was thrown out of service on 17th June 1994. Not only that, a deliberate attempt was made before the learned Judge of the Labour Court to present the facts in a manner, which is not befitting to a local authority. Rukshmaniben Hiralal Rajpopat vs. Rajkot Nagar Primary Education Committee. 2011 (131) FLR 872 (Guj. HC)
Disciplinary proceedings High Court is not required to interfere with the findings of the enquiry officer based on evidence and decision of the disciplinary authority to come to a different finding. Dismissal of the employee even after retirement is not illegal if rules so permit. Punishment of dismissal from service of the bank officer based upon the charges as proved, should not have been interfered by the High Court. In a proceeding under Article 226 of the Constitution of India the High Court, while exercising its powers of judicial review, should not sit as an appellate authority being not a Court of appeal over the decision of the authorities holding a departmental enquiry. Business Manager
January 2012
39
From The Court Room When a bank employee challenges his dismissal after enquiry, the High Court cannot appreciate the findings of the Enquiry Officer and disciplinary authority based on some evidence and to come to a different and independent finding. When the issuance of charge-sheet and initiation of disciplinary proceedings took place against the delinquent officer during his service, his dismissal after his retirement is not illegal when the Rules so permit. State Bank of India vs. Ram Lal Bhaskar & Anr. 2011 LLR 1233 (SC) Failure of employee to submit written explanation of the charge sheet, can’t be presumed as admission of charges by the employee. Imposing major penalty without holding enquiry is a serious flaw. When the delinquent employee fails to submit his explanation to the charge-sheet, the Management cannot presume that he has admitted the charges and holding of enquiry be dispenses with. Imposing major penalty upon the delinquent employee, without holding of enquiry, is a serious flaw and entire disciplinary proceedings will be vitiated. Principles of natural justice will be violated if no enquiry is held before imposing punishment. If employee is willing to work but not allowed to do so by the employer, the principle of 'no work, no-pay' would not be applicable. U.P. Cooperative Bank Ltd. & Ors. vs. P.O., Labour Court & Ors. 2011 LLR 1247 (All. HC) In enquiry, proof is not required beyond doubt. It is the realm of probability. Accident of the Bus driven by driver due to rash and negligent driving. Panchnama showing that at the time of the accident Bus was on the wrong side of the road. Material on record cannot be said to be inadequate for the Inquiry Officer to conclude that charge of negligence and charge of rash driving is proved. Conclusion based on material on record. Merely because order of acquittal was passed in favour of the respondent in criminal proceeding. Labour Court ought not have interfered with the findings of the Inquiry Officer. In Departmental Enquiry requirement of proof is not required to the extent of "proof beyond doubt". It is in the realm of probability. Divisional Controller, Gujarat Sate Road Transport Corporation vs. Mohmad Adambhai Mushabhai Bhodiya. 2011 (131) FLR 859 (Guj. HC)
Dismissal justified of a bus conductor found carrying 18 ticketless passengers. Dismissal of a bus conductor, found guilty of 18 ticketless passengers, should not have been interfered by the Appellate Authority since such persons deserve to be severely punished and the reduction in punishment is deprecated. U.P.S.R.T.C. through its Regional Manager, Jhansi vs. Presiding Officer, Labour Court (IV), Business Manager
Kanpur and Another. 2011 LLR 1236 (All. HC) Dismissal justified for habitual absence. Dismissal from service of an employee, guilty of habitual absence without satisfactory explanation including inconsistent and improper medical certificates of his treatment does not warrant interference by the court. A. Ganesh Reddy vs. Chief Traffic Manager, B.M.T.C. Central Officers, Bangalore. 2011 LLR 1243 (Karn. HC) An employee who could not respect his superior can’t be permited to remain in service. An enquiry should not have been vitiated merely because the Enquiry Officer could not appear before the Labour Court to prove the report.When the report of the Enquiry Officer is not questioned before the Labour Court, the enquiry will not be held to be illegal.When several people have seen the incident of slapping the Assistant Traffic Inspector by the bus driver, the charge was squarely proved against the driver. Allegation by the delinquent that he was not been allowed to examine the witnesses in the enquiry without supporting the same would not be tenable. An employee, who could not respect his superiors, cannot be permitted to remain in service. U.P. State Road Transport Corporation Through Regional Manager, Kanpur Nagar vs. Rajendra Singh and Another. 2011 LLR 1257 (All. HC) Labour court order of modifying the punishment of dismissal into reinstatement by withholding two increments for the misconduct of unauthorised absence of 11 months would be illegal. Award punishment of dismissal modified by impugned order of Labour Court to one of reinstatement by withholding two annual increments with cumulative effect. Unauthorised absence for eleven months and four days coupled with past record of unauthorised absence of 35 days. It was a grave indiscipline. Exercise of power under section 11-A by Labour Court modifying punishment of dismissal held to be perverse. Award impugned modifying punishment of dismissal quashed. And in all other respects remained unaltered. Writ petition of workman rejected and writ petition of Road Transport Corporation allowed. Smt. Padma and others vs. Chief Traffic Manager BMTC Central Office, Bangalore. 2011 (131) FLR 914 (Karn. HC)
Employees’ compensation Act.
Dismissal
40
Latest Judgments
January 2012
When husband is the driver and his wife is the owner of the autorikshaw, there would be no master-servant relationship for the purpose of getting claim under W.C. Act. The claimant/injured, an auto driver being husband of the owner of the offending vehicle, living under one roof leading marital life, would not be treated as a workman under the Workmen's/Employees' Compensation Act for
From The Court Room the purpose of entitlement of compensation. Prapulla Chandra Satyanarayana vs. Prapulla Chandra Appalakonda and Another. 2011 LLR 1245 (AP HC)
E.S.I. No damages for late deposit without serving show cause notice under ESI. Assessment of damages without service of show cause notice upon the employer, being against the principles of natural justice, is illegal and liable to be quashed. Service of show cause notice upon the employer, before assessment and imposition of damages to be recovered, is mandatory. A.K. Industries, Rohtak through its Authorised Signatory D. Mukherjee vs. Employees' State Insurance Corporation through its Regional Director, Faridabad and Ors. 2011 LLR 1248 (P&H HC) In the absence of having any medical facility for treatment of heart ailment by ESIC, expenses incurred for treatment in a private hospital by the employee who died, his legal heirs will be entitled for reimbursement of expenditure from ESIC. When a workman covered under ESI Act has developed breathlessness and swelling in the feet and after admission in a private hospital died, compensation has been rightly awarded by the Employees' Insurance Court. When the ESIC did not have proper arrangement for treatment of heat ailment and the deceased had to spend money for specialised treatment in a private hospital, his legal heirs are to be reimbursed for the expenditure as incurred. Regional Director, E.S.I. Corporation, Bangalore vs. Smt. Lakshmi Biradar and Others. 2011 LLR 1271 (Karn. HC)
Equal Pay - Equal Work The demand of equal pay for equal work not justified on the basis of industry cum region formula. When two units of the industry are situated in differnt parts of the country, equal pay can’t be given to employees of both the units. The demand of equal pay for equal work is not justified and proper when the two units are situated in two different pats of India i.e. one at Hyderabad, metro city, established in 1956 and another at Jasidih, a small place, in Jharkhand came into existence in 1979, on the basis of industry-cum-region formula as per law settled by the Apex Court. Workmen represented by Hyderabad Asbestos Cement Products Limited vs. Management of M/s Hyderabad Industries Ltd. 2011 LLR 1269 (Jharkhand HC)
Gratuity Appeal against the order of controlling authority after maximum limit of 120 days will not be maintainable.
Latest Judgments For abetting the miscarriage of justice, High Court is empowered to exercise its extraordinary jurisdiction under Article 226 of the Constitution of India. The Appellate Authority under section 7(7) of the Payment of Gratuity Act can condone delay only upto 120 days and not beyond that. Appeal against the order of Controlling Authority, after maximum limit of 120 days, will not be tenable. Bhavnagar Municipal Corporation vs. Sunderben Chhanabhai Baraiya Legal heirs of late Chhanabhai & 2 Ors. 2011 LLR 1250 (Guj. HC)
Industrial Disputes Act. Conciliation Officer’s bounden duty is either to record / register a settlement or to submit a failure report. He has no power and jurisdiction to declare that a bipartite settlement will be considered as binding upon all workmen. As per provisions of Section 12 (5) of the Industrial Disputes Act, 1947, the Conciliation Officer has no jurisdiction to adjudicate upon the settlement between the parties as his powers are limited either to record the settlement or to submit a failure report. The jurisdiction of the Conciliation Officer is for settlement of dispute and over-stepping its jurisdiction for determination of an industrial dispute is not tenable. Vidyut Metalics Employees' Union, Thane vs. Vidyut Metalics Pvt. Ltd., Thane and Ors. 2011 LLR 1262 (Bom. HC) When the workmen received the amount in terms of settlement without any protest, no claim under 33(C)(2) of ID Act can be made by them. Status of petitioners as to whether they are trainees or workmen can’t be decided under such application. When the petitioners have received the amount in terms of settlement, that too without any protest, they are not entitled to make claim for money under section 33(C)(2) of the Industrial Disputes Act. R. Udayakumar etc. vs. The Presiding Officer, II Additional Labour Court, Chennai and Anr. 2011 LLR 1265 (Mad. HC) When the bus conductor was charged for taking money from passengers without issuing tickets but found short of cash of Rs. 8.50, charge can’t be believed to be proved. Dismissal illegal. Reinstatement with 50% back wages appropriate. Labour Court has erroneously rejected the claim petition of the bus conductor by disbelieving his evidence whereas there was no plausible evidence in support of the charges. It is unbelievable that a bus conductor has been charged for receiving fare and not issuing tickets but, in reality, Rs. 8.50 were found short hence the High Court granted reinstatement. 50%, instead of full back-wages, would be appropriate when the bus conductor whose Business Manager
January 2012
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From The Court Room dismissal has been held illegal could not make any effort to find out suitable employment during the inter-regnum. Krishan Kumar Nagar vs. Management of M/s. Delhi Transport Corporation. 2011 LLR 1273 (Del. HC) For getting interim relief under sec. 17(B) of ID Act pending proceedings in HC, workmen has to give an affidavit that he is unemployed, only then the payment will be released. While making a claim for last drawn wages under section 17-B during pendency of the proceedings in the High Court, the workman has to give an Affidavit that he is unemployed, only then the payment will be released. The workman who was reinstated but a writ petition was filed in the High Court, though gainfully employed but fraudulently he did not give proper particulars, he was guilty of suppressing the material facts in the writ and, as such, he was not entitled for any further amount and whatever he has taken has to refund its 50%. Satya Prakash and Sons vs. Presiding Officer, Labour Court, Kanpur and Another. 2011 LLR 1275 (All. HC) Labour court is not empowered to entertain a claim under sec. 33(C)(2) of ID Act which is not based on existing right. It is well-established that the right to a benefit, which is sought to be computed must be an existing one i.e. already adjudicated upon or provided for and must arise in the course of and in relation to the relationship between the workman and his employer. It is not competent for the Labour Court, exercising jurisdiction u/s. 33-C(2) of the Act, to arrogate itself to the function of the industrial tribunal and entertain a claim, which is not based on, but which may appropriately be made a subject matter of industrial dispute in a reference u/s. 10 of the Act. Where the very basis of the claim or the entitlement of the workmen to a certain benefit is disputed, there being no earlier adjudication or recognition thereof by the employer, the dispute relating to entitlement is not incidental to the benefit claimed and is, therefore, clearly outside the scope of a proceeding u/s. 33-C(2) of the Act. Mohan Nagpal vs. Editor, Navbharat Times, New Delhi and Anr. 2011 III CLR 692 (P&H HC)
Lock out When the workmen have accepted that they have indulged in violence, the declaration of lock-out by the employer will be legal. Punjab Tractors Workers' Union (Regd.) vs. The Presiding Officer Industrial Tribunal, Punjab, Chandigarh and Anr. 2011 LLR 1277 (P&H HC) 42
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Latest Judgments
Provident fund Civil suit is not maintainable under EPF Act as the same has its own special provisions of appeal before appellate authority. When a specific remedy is provided in a particular statute, it has to be availed and no other recourse under any other Act will be permissible. When the jurisdiction of the civil court is barred by the provisions of EPF & MP Act, filing of civil suit will not be maintainable. Regional Provident Fund Commissioner vs. Dr. O.P. Mittal and Another. 2011 LLR 1254 (P&H HC) EPF authority can’t claim contributions for the period for which workman neither worked nor agreed to be treated on duty. When the workman pending the writ petition, in which the award for his reinstatement in service is under challenge, settles the disputes with the management and takes monetary compensation, he cannot be treated to be in service of the said management for relevant period, for the purpose of EPF contributions. E.P.F. Appellate Tribunal held that- (i) Authority cannot claim contributions for the period for which respondent no. 3 workman neither worked nor agreed to be treated as on duty; (ii) No reliance can be placed on the interim order passed by this Court; (iii) The amounts paid to respondent no. 3-workman, makes no reference to wages and hence no contributions can be claimed from the petitioner; (iv) Order passed by the Tribunal confirming the order passed by 2nd respondent is not sustainable and hence set aside. Universal Brakes (P) Ltd., Coimbatore vs. Presiding Officer, Employees' Provident Fund Appellate Tribunal and Ors. 2011 III CLR 662 (Mad. HC)
Reinstatement Reinstatement proper of a bus driver when management did not adduce any evidence to prove that driver was driving the bus in a rash and negligent manner causing death of a car driver. In case the Management fails to adduce any evidence to prove rash and negligent driving on the part of the bus driver whose service was dismissed by it, awarding of reinstatement with full back-wages and continuity of service by the Labour Court to the bus driver would not be perverse. The Depot Manager, A.P.S.R.T.C. Wrangal-I Depot and Another vs. J.M. Reddy s/o Pulla Reddy and Another. 2011 LLR 1264 (AP HC)
Resignation To be treated as a letter of resignation with the eyes of law, language should be un-conditional without reflecting any pressure.
From The Court Room
Latest Judgments
In case the language of letter of resignation does not indicate that it is unconditional and without having any foreign pressure upon the employee, the same may not be treated as a letter of resignation in the eyes of law. Relief of reinstatement with partial back-wages is justified when letter of resignation does not inspire confidence of the court as well. When a resignation is ambiguous, it cannot be acted upon and the acceptance thereof by the employer will be liable to be quashed. Gujarat Water Supply & Sewage Board and Anr. vs. Mahavirsinh Balapbha Gohil. 2011 LLR 1259 (Guj. HC)
Retrenchment In case of illegal termination without retrenchment compensation, reinstatement without back wages proper. Non-payment of retrenchment compensation and one month's salary in lieu of notice to a workman who has worked for 240 days will render his termination invalid and the workman will be entitled to reinstatement which has been rightly held by the Court. Board of Secondary Education vs. Rajesh Nema and Another. 2011 LLR 1280 (MP HC)
VoluntaryAbandonment Even if sending four letters to a daily wager asking him to report for duty will not be a ground of abandonment but will be a case of illegal termination, when not followed the retrenchment procedure. Compensation appropriate instead of reinstatement in such a case. Even when four letters have been set to a daily wage employee, absenting himself and asking him to report for duty, no presumption can be drawn that he has abandoned the job of his own accord even if he has not resumed the duty. A daily wager will not be entitled to reinstatement even if he has worked for one year and appropriate compensation would meet the justice. Section 25F of the ID Act providing for payment of retrenchment compensation at the time of retrenchment of the workman will be applicable even in cased of a daily wager who has completed 240 days' working. Municipal Corporation of Delhi vs. R.L. Chugh and Others. 2011 LLR 1256 (Del. HC)
Voluntary retirement Withdrawal of application for voluntary retirement is permissible till the date the same is to be effected in future. The applicant is having a legal right to withdraw his voluntary retirement application before the date it is to take effect. Refusal by the employer to withdraw the application, before the date it is to take effect, is illegal and its consequences may be reinstatement of the
applicant with continuity of service and other benefits. Acceptance of voluntary retirement application, before the date it is to take effect, cannot justify refusal of the employer to withdraw that application by the applicant/employee. Balaram Saghan Kshetra Samiti vs. Kantaben Laljibhai Patel & 2 Ors. 2011 LLR 1251 (Guj. HC) If an application for voluntary retirement is not withdrawn before acceptance, its acceptance by the employer will be valid. When the delay in filing appeal is not having sufficient cause, with an explanation to the delay of each and every day, the same may not be condoned by the court. Siddaiah vs. Management of Mandya National Paper Mills Ltd., Belagula. 2011 LLR 1267 (Karn. HC)
Workman A daily wager does protection of ID Act.
not
have
the
A daily wager does not have the protection of Industrial Disputes Act, particularly of its sections 25F and 2(oo) and the Award of the Industrial Tribunal allowing reinstatement of the workman is wrong and liable to be set aside. State of Haryana and Others vs. Sanjay Kumar. 2011 LLR 1240 (P&H HC) Advocate / Legal advisor of the bank is not a workman under ID Act. A 'workman' within the meaning of S.2(s) of the Act, must not only establish that he is not covered by the provisions of the Apprentices Act, but must further establish that he is employed in the establishment for the purpose of doing any work contemplated in the definition of 'workman'. Sonepat Central Co-operative Bank Ltd. vs. Presiding Officer, Industrial Tribunal-cumLabour Court, Rohtak and Anr. 2011 III CLR 704 (P&H HC) Branch officer of a finance company can’t be held to be a workman. Supervision contemplates direction and control. While determining the nature of the work performed by an employee, an undue importance need not be given to his designation or the name assigned to, the class to which he belongs. What is needed to be considered is what are the primary duties he performs. Whether or not an employee is a workman under S.2(s) of the I.D. Act, is required to be determined with reference to his principal nature of duties and functions and the facts and circumstances of the case and materials brought on record. No straightjacket formula can be prescribed on this point. Gruh Finance Limited vs. Pradip K. Shah. 2011 III CLR 708 (Guj. HC)
Courtsey - Labour Law Reporter,FLR, CLR & APS Labour Digest
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Niraj Kumar Corporate Advocate
There are conflicting judgments of various High Courts on the point whether conveyance allowance should be treated as wages for ESI contributions. While Madras High Court in six judgments from 2000 to 2011 has held that conveyance allowance will not be treated as part of wages, Karnataka, Kerala Andhra Pradesh High Courts have held conveyance allowance will be part of wages for ESI contributions.
Whether ESI is to paid on conveyance allowance Whether conveyance allowance should not be included in wage for ESI calculation in view of recent judgment i.e. In re Cosmopolitan Club, dated 30.6.2011.decided by division bench Madras High Court. CASE LAWS Hon'ble Madras High Court has given very confronting opinion at the subject issue from time to time. 1. Management Of Oriental Hotels ... vs Employees' State Insurance (Madras High Court on 14 November, 2000) "While confirming the judgment of the learned single Judge in so far as the house rent allowance is concerned, we set aside that part of the judgment which holds that conveyance allowance is also part of wages on which contributions are payable. The L.P. Appeal is allowed in part." 2. Regional Director, Employees' ... vs Sundaram Clayton Ltd. And Ors. (Division Bench, Madras High Court on 10 December, 2003) "From the above said decision, it is clear that though such a payment towards conveyance allowance falls within the ambit of additional remuneration, it will come under the exclusion clause as provided under the above said definition. The conveyance allowance paid to the employees for the purpose of being utilised on the travel from the place of residence to the place of work has to be construed as travelling allowance and thereby it cannot be construed as wages, as travelling allowance has been excluded from the purview of the said definition. We agree with the said decision reported (supra), and so the Employees' Insurance Court is correct in holding that the conveyance 44
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allowance cannot be construed as "wages" and the respondents are not liable to pay contribution taking into consideration the said amount as "wages."" 3. The Assistant Regional Director vs Chandrasekarapuram Co. Op Madurai Bench of Madras High Court on 10 March, 2006) "Hence, I hold on the point that the short payment, temporary daily wages, incentive payments, subsistence allowance, batta, meals expenses, conveyance charges etc., as mentioned in Ex.P.1, notice, will come under the definition of Section 2(22) of the E.S.I.Act and the respondent is liable to pay E.S.I Contribution to the appellant and that the order passed in E.S.I.O.P.No.22 of 1994 is liable to set aside in respect of the short payment, temporary wages, incentive payments, subsistence allowance, batta, meals expenses and conveyance. The point is answered accordingly". 4. Cosmopolitan club.V. Deputy director‌‌ (single bench, Madras High Court on 17.09.2009) " The learned Consel appeasring for the petitioner would rely on a judgment of the Hon'ble Supreme Court in regional Director Employees' State insurance Corporation Madras vs. Sundaram Clayton Ltd., Moppet Division, Madras reported in 2004 (1) L.L.N. 630 wherein the Hpn'ble Supreme Court has held that Conveyance allowance shall not form part of the wages for the purpose of ESI Act". " In view of the above said law laid down by the Hon'ble Supreme Court, the writ petition is allowed and the impugned order is quashed. It is made clear that conveyance allowance shall not form part of the wage for
Whether ESI is to paid on conveyance allowance?
the purpose of ESI Act. Connected miscellaneous petitions are closed" 5. Deputy director‌‌.V. Cosmopolitan club (Divison bench, Madras High Court on 30.06.2011) (LPA against the decision of single bench in item no.4) "After hearing the learned counsels for the parties, we do not find any merit in this writ appeal, which is accordingly dismissed. There will be no order as to cost" 6. The Management Of Magus Customer Dialog Private Limited vs The Deputy Director (Madras High Court on 15 February, 2011) "A reading of the above passage shows that there was an error found while describing the Sundaram Clayton's judgment as the judgment of the Supreme Court." "Further, it cannot be said that Sundaram Clayton's case sets out the law on the field." "As held in Sundaram Clayton's case, unless it is proved that the amount was paid only in lieu of travelling allowance or the petitioner is paying the actuals of the expenditure incurred by the employees and in the absence of these ingredients, there cannot be any automatic presumption in favour of the petitioner's company and that a direction to the respondent must be issued to desist from passing final orders." "In the present case, whether conveyance allowance can be treated as travelling allowance coming within the definition of Section 2(22)(b) of the ESI Act is essentially a question of fact for which evidence will have to be let in by the parties as was done in the case of M/s.Sundaram Clayton." OTHER HIGH COURTS Hon'ble Karnataka High Court in The Regional Director, ... vs I.T. Solutions (India) Private ... on 6 August, 2002 held that "I refer to the decision of Hon'ble Supreme Court rendered in M/s. Harikar Poly fibres v. Employees' State Insurance Corporation, In the said case, the Supreme Court has held that house rent allowance, night shift allowance, incentive allowance and heat and dust allowance fall within the definition of wages in Section 2(22) of the Act. Therefore, since the applicant-employer is paying a certain fixed amount as conveyance allowance to every employee working in its concern, in terms of contract of employment, there is no impediment to hold that the conveyance allowance forms part and parcel of wages within the definition of Section 2(22) of the Act. Therefore, I answer the point raised by me in the affirmative." Hon'ble Kerala High Court in The Regional Director, Esi ... vs M/S.Tony Harris Sea Foods Ltd on 22 January, 2009 held that "Therefore I am inclined to agree with the decision rendered by the Karnataka High Court in preference to the decision of the Madras High Court for the INAP 40/2007 -:7:reasons stated in the previous paragraphs of
the judgment. Therefore the appeal is allowed and the order passed by the E.I. Court is set aside and it is held that conveyance allowance forms part and parcel of wages and it shall be taken into consideration for the purpose of fixing the ESI contribution." Hon'ble Andhra High Court in The Dy. Director, Esi ... vs Amrutanjan Limited, Hyderabad, on 18 February, 2009 held that "The learned Tribunal, on appreciation of evidence available on record P.W.1, R.W.1, R.W.2; Exs.P-1 to P-16, Exs.R-1 to R-6, recorded findings in detail, dealt with the definition of wages, referred to the decision in Harihar Polyfibres v. Regional Director, ESI Corporation ((1984) 4 SCC 324) and came to the conclusion that the conveyance allowance and washing allowance must be treated and included as wages and further dealt with Regulation No.40 and further came to the conclusion that the payment of contribution in respect of 40 employees had been paid due to pressure and when the amount of contribution was paid under such circumstances Amrutanjan Limited company is entitled for refund and accordingly allowed the E.I. Case No.41 of 2001." "In the light of the legal position referred to supra and also in the light of the factual matrix and the clear findings recorded by the Tribunal in elaboration on appreciation of the oral and documentary evidence, this Court is satisfied that the findings recorded by the Tribunal cannot be found fault while allowing the E.I. case of the Amrutanjan Limited. Hence, the said findings are hereby confirmed." ESIC VIEW: Fixed conveyance allowance flowing out of a wage settlement or as per terms and conditions of employment should be treated as wages under section 2(22) for all purposes except: 1. Amount towards conveyance paid or reimbursed to any employee for incurring expenses for specific duty related journey 2. Reimbursement of actual cost of conveyance for coming to work and going from work on production of ticket or season ticket and subject to proof of actual expenditure 3. Payment of certain amount for maintenance of vehicle depending upon cadre of the official and category of vehicle and subject to production of records for actually maintaining the vehicles 4. Fixed allowance paid at an interval exceeding 2 months, unless such payment is made as per contract or agreement. CONCLUSION: In general Conveyance allowance should be considered as part of Wages as defined under section 2 (22) of the ESI Act, as most of the High Court and also ESIC has considered. BM (Views are personal) Business Manager
January 2012
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BOOK LEARNING
Supreme Court Labour Judgments (2010)
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Case Referencer (2005-2010)
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he judicial pronouncements by the Supreme Court are reported in numerous official and non-official journals and Gazettes with the result that their quick reference is a difficult and tedious affair. To facilitate this, these three publications namely "Labour Law Digest (2010)", "Supreme Court Labour Judgments (2010)" in continuation of earlier Supreme Court Labour Judgments (1950-2009) in 26 Vols and "Labour and Service Case Referencer (2005-2010)" have been brought out. The compliations are exhaustive and have been edited by eminent authors. The chief object of these books is to place before the employers/employees, trade unions and those concerned with labour and industrial disputes, an analytical study of latest cases on topics such as Award, Bonus/Punishment/Disciplinary Proceeding, Gratuity, Lay-off, Lock-out/Retrenchment/ Strike, Wages under various industrial enactments like the Industrial Disputes Act/ Factories Act/ Minimum Wages Act/ Workmen’s Compensation Act/ etc. An exhaustive list of contents of the subject is given at the beginning of the books, and parallel references to different law journals and reports have also been given. A consolidated table of all the cases decided is also given. It is hoped that these books will be of guidance and assistance to all connected with Industrial and Labour Disputes.
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his primer on labour and employment laws discusses the entire gamut of employer-employee relationship in the Indian legal context is written by Alok Basin, Advocate of Supreme
Written simply and lucidly the book encompasses the “contract of employment” including the indicia for determining the existence of employment relationship, “conditions of service” including wages or remuneration, working time, overtime, leaves, holidays, health, welfare and safety, termination, redundancy, collective bargaining, unfair labour practices, trade unions, industrial disputes (trade disputes), etc.and “the legal aspects of labour or industrial relations”. The book also deals with issues of concern to non-workers such as managers, supervisors and other “officers” as also to the employers.
Labour Laws –A Primer By Alok Bhasin Publisher : EBC Publishing (P) Ltd., 34-A, Lalbagh, Lucknow - 226001 Price : 295/Email : sales@ebc-india.com 46
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Various related statutory enactments and regulators have been duly included, namely, Employees Provident Funds and Miscellaneous Provisions Act, 1952; Employees’ State Insurance Act, 1948; Employees’ Compensation Act, 1923; Payment of Gratuity Act, 1972; Industrial Disputes Act, 1947; Trade Unions Act, 1926 etc. Some special provisions for female employees including the Vishaka guidelines and norms towards combating sexual harassment have also been given. The book is certainly going to be beneficial to the judiciary, labour lawyers, consultants, labour unions, managers, legal departments of companies, employers, students of ICWA, CA and CS, etc.
CASE
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Non Peformers loyalty : Asset or Liability?
N
ovais Lab Pvt. Ltd. a pharmaceutical manufacturing Unit of generic products for health care was established in 1980 by Praful Sen Gupta, then a 27 years old grandson of a politician. It was under the umbrella of Manik & Chandra House, a 40billion turnover company that this unit was set up. Manik &Chandra House was one of the largest business houses of the country with several successful ventures to their credit like steel, automobiles, dairy products, fruit juices, etc. Novais Lab. Pvt. Ltd. dealt in generic products like nutritional, respiratory, dermatological, analgesic and anti-inflammatory & gastrointestinal but none of them were patented. The corporate mission of the company was to develop and market therapeutically correct, clinically relevant, efficifacous and patient friendly formulations for the ethical prescription market. The company wanted to build a strong relationship with the medical fraternity by adopting high ethical standards and finally provide the ultimate consumers i.e., the patients with quality products at affordable prices. The company had its distribution network with around 40000 retail chemists through a network of 12 sales depots, 300 stockists and numerous wholesalers. They catered to the States like Rajasthan, MP, Maharashtra, Karnataka, Kerala, Tamil Nadu, Chattisgarh, Orissa, Bihar, West Bengal and Assam in India. The company had its registered office at Pune(India) wherein majority of the employees were of West Bengal origin. It had a turnover of 7 Billion approximately with a growth rate of 16% p.a. which was much less than the average pharma industry. The company's operations were looked after by 67 years old Manik Datta who had joined the company as a sales representative and by his dedication, loyalty and commitment had risen to the post of a CEO. He had a daughter and a son pursuing their careers abroad. The company was a family owned business headed by a 57 yrs old, Praful Sen Gupta who had only one son settled in London. The company had a flat structure with four levels CEO, DSM, ASM & DVSM in each functional areas of marketing, finance & HR. Although the company had the existence for last 30 yrs but the graph of the growth was not
Novais Lab Pvt .Ltd. was a pharmaceutical manufacturing unit of generic products. It was systematically managed. The corporate mission of the company was to develop and market therapeutically correct, clinically relevant, efficifacous and patient friendly formulations for the ethical prescription market. The company wanted to build a strong relationship with the medical fraternity by adopting high ethical standards and finally provide the ultimate consumers i.e., the patients with quality products at affordable prices. The ethical practices of the organisation had given the organization goodwill in the market. This had made the employees to enjoy the comfort zone. The very conviction that their jobs were secure had brought laxity in their approach. They did not show any drive and passion to perform. The company was growing but at a snail's pace. The concern of the newly appointed Marketing Head was how to enhance performance of the employees so that sales can be boosted. The organization being a staunch follower of past practices did not have the practice of penalizing the non- performers. The case gives an insight into some of the pertinent issues related to the change management which had become imperative in the existing situation. Business Manager
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CASE
study
satisfactory when compared with the pharma industry scenario.In 2004, the company hired the services of 41 year old IIM graduate in strategic management, Anup Mitra, who had an illustrious career in pharma industry having worked with Dr. Reddy's, Aventis, Zydus Cadilla and Rhone. He was appointed as chief of marketing sales and distribution and would report to CEO and chairman of the company. He was promised full autonomy in decision making. Mitra joined and was quite enthusiastic and promised to himself that within a year he would change the face of the company. Once he was in he tried to study the minutest details of the company to address the problem. Soon he understood that the source of the problem was the comfort zone of the employees and decided to be tough with the non performers. He held frequent meetings with the employees and reminded them that performance should be the priority of every body and non performers will not be spared. He started monitoring the performance of every employee. In the process the non-performance of Ashok Roychoudhary, a 45 years sales executive came to his notice. He called him and counselled him but the performance of Ashok did not improve. He held a series of meetings with him to understand his problem so that he could facilitate him to improve his performance. But it was all in vain. Mitra got an understanding that Ashok had become lacksdial and did not want to put in effort. He had been with the company since its inception and enjoyed good rapport with every one. In between he had left the company but after six months he had joined back. Mitra warned him that his nonperformance could cost him his job but it was not taken seriously by Ashok. He continued in his casual way. Now Mitra was left with no option other than taking a harsh decision of firing him. He issued the orders against Ashok. This came as a shock to Ashok and other employees. Once Ashok received the orders, he approached the CEO and the CEO and chairman intervened and asked Mitra to withdraw the orders. Mitra strongly pleaded that this withdrawal had serious repercussions. But both CEO and Chairman did not listen to him saying that the company had a track record of never firing an employee. Moreover, they did not want to lose an old employee leaving no option with Mitra other than withdrawing the orders and reinstating Ashok. The company had around 250 employees in the average age group of 40 to 55 years and the turnover was nil. The company had a track record of never firing an employee but if the employee would leave by his/her own will, would always look forward to rejoin. Whosoever would join the company would never think of leaving the organisation. Regarding the package, the company was not a good pay master as per the Pharma industry standards though it ensured that the salary would be credited to the employee's account on the 30th of every month. Moreover, the company was very particular in giving the increments every year to its employees. Even during the time of slow down the company did not hold back the increments. The company was a system driven company where protocols were in place and nobody would ever think of deviating from the system. Anup Mitra was quite surprised to see the loyalty, commitment and the emotional bonding of the employees in the organization, yet the company was not growing at the pace at which it was expected. It was a grave concern for Mitra, who had taken up this job as a challenge to get this company nearer to the Pharma industry's market growth. The first 48
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The company had around 250 employees in the average age group of 40 to 55 years and the turnover was nil. The company had a track record of never firing an employee but if the employee would leave by his/her own will, would always look forward to rejoin. Whosoever would join the company would never think of leaving the organisation.
CASE
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step he took was to induct young qualified staff to the field, but to his utter dismay he found that the sales dipped down drastically. He even tried the combination of the existing and the new staff together but the results were not favourable. In case of any unforeseen eventuality of an existing employee it was difficult not only to revive the relationship with new replacement but also to sustain the business. This would always put a question mark for the future in the mind of Mitra. Company had a performance appraisal system to evaluate the employees performance but as per the company's policy no stringent action was to be taken. The targets were not strictly followed and the non-performers would go to the CEO and say sorry and get away with it. Employees even did not ask for more nor did they express any grievances.
Future Ahead... The company was completely people oriented and would always encourage a family culture. They would not mind spending any amount for employees' welfare, felicitation, continuous development, etc. They would allot substantial budget for training and the training would be given on regular basis to the new recruitees and the existing employees. The company unlike the pharma industry practices did not entertain any favours asked by the doctors and therefore no gifts, no sponsorships were provided to promote their products either to the doctors or to the channel members. They believed that for survival one has to be ethical and would rely on the quality of their products and the sincerity of their people, inter-personal relations, and regularity of the visits and hence depended more on older people. In the existing scenario when organizations spent huge amounts to entertain doctors and channel members, the company showed their concern about quality products against the sub standard products for their survival in the market. They even did not compromise on the price. Their strong belief system did not allow them to join the rat race in the Pharma industry because they felt that it would question the very purpose of their existence in the society. The company had been hiring the services of the executives with illustrious careers in their field at any compensation from time to time. But soon the enthusiasm of these executives would die down and they would start feeling the brunt of stagnation. Mitra too had started feeling the same. For him ethical culture and strong value system had its own importance, but it should not hamper the growth of the company. It was important that growth had to be somewhere nearer to the industry growth if it had to survive. The company had recently gone for some expansion by introducing a new segment for the same product after doing an extensive market research. The company had the ranking of 165 in the ORG out of 25000. It was looking forward to be in the list of 100 with the turnover of 1 billion plus. But with the kind of strong belief system and the resistance to implement change, risk aversive ness of the top management it seemed a distant dream to Mitra. He was not able to answer his dilemma whether people are the strength of the organization or they are a liability. It forced Mitra to think over again and again as to how long he can continue here, if the top management is going to have the same approach? BM
QUESTIONS FOR DISCUSSION
Q
1.
Q
2.
Q
3.
Do you think the strong culture is promoting resistance to change?
Is zero employee turn over strength or a weakness? Discuss
Critically evaluate the ethical dilemma of Mitra.
(Readers are invited to send analysis of the case. Best will be published)
This case was developed by Dr.Santosh Dhar (Professor - Institute of Management, JK Lakshmipat University, Jaipur Rajasthan); Dr.Gulab Mohite (Dalamia Institute of Management Mumbai).;Ms.Usha Kumar (BVISMR, Navi Mumbai) in a case writing workshop organized by BVISMR in collaboration with JK Lakshmipat University on December17-19-2009. Business Manager
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A CASE STUDY FROM UNITED BREWERIES LTD.
CASE
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Organizational Theory & Corporate Social Responsibility Organizational Theory and CSR Organizations exist and most importantly sustain, through belief systems; Systems, which, according to Miles and Snow, are built out of a dynamic network involving a combination of strategy, structure and management processes (Galbraith, et al). The concept of Corporate Social Responsibility is deeply rooted in the organization theory and organizational belief systems. Chester Barnard's book 'The Functions of the Executive' defines a formal organization as a system of consciously coordinated activities of two or more persons. Barnard's emphasis was on the existence of a cooperative system which is contingent on the human participants' ability to communicate and their willingness to serve and strive towards a common purpose. Modern organization theory has its foundation in this theory, extending to the concept of interacting parts.
The open-systems concept theory of organizations therefore stresses the input of the external environment - recognition of the external environment as a source of significant input. In a typical 'Systems' perspective therefore, the boundaries of the organization are not closed, therefore necessitating an organization's focus on the different aspects of the environment. That being a clichĂŠd theory (any standard Business School possibly will discuss this as part of the first term of academics itself), the subtle line of effectiveness of Corporate Social Responsibility possibly lies in execution of the CSR initiatives to have the maximum positive impact (Utilitarian concept). In a recent interview session for students, the following hypothetical scenario was cited as part of a larger case study - there is a draught-hit village somewhere in the country, and there is a large factory in the 50
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Suvro Raychaudhuri Human Resources, United Breweries Ltd.
Debismita Gupta Human Resources, United Breweries Ltd.
A CASE STUDY FROM UNITED BREWERIES LTD.
CASE
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vicinity that decides to take on a CSR initiative around this village. There are multiple scenarios on this: 1) The organization arranges for water tankers to and from the village, on a regular frequency basis. 2) An NGO arranges for the water tankers to and from the village, the organization pays enough to ensure that every tanker is branded with the organization's logo. 3) The organization does a water-research at the village, digs a borewell and builds a rain-harvesting solution Having elaborated other additional situational factors, a significant majority (around 85%) supported scenario 3 above. The case study went complicated, when a situation was thrown in that the local villagers caused a flash-resistance to truck movement in and out of the factory, demanding employment of unskilled labour through Panchayat references (and not skill-based). The case study was further intensified when a scenario around social networking was coupled in, where there were a few thousand Facebook comments on how the organization has tried to use influence to subdue the resistance through local political influence and police. There was a 10-point simulation that followed, over and above this, reversing and straightening the statements and the assumptions around the case each time. The interview situation turned around, with a significant majority (around 70%) now shifting their preference to point 2, but requesting the interviewer a fourth option around incorporating 'both options 2 and 3'. The shift in preference appeared to be a logical continuation of a deeper organizational theory - that organizations are not just about Open Systems as discussed above, but also about Information Processing - a transition between organizational theory on 'Open Systems' Vs. organizational theory on 'Contingency'. CSR gets more and more complicated therefore, and all the more attached to the deeper and subtler nuances of organizational theory, because in a limited carrying capacity of the environment that makes it a competitive arena, executing (the actual activity with all its noble intentions) and branding (information processing) of it become equally important. There is continuous internal work (research, debate, hypothesis formulation and testing, application and perspective-sharing) in multiple organizations, including United Breweries Limited, in terms of the complexity around Social Responsibility of Corporates. Fundamentally, as long as organizations used to maintain their topline and bottom-line, keeping the people-line in between intact through creation of job opportunities, investing its profits into higher schemes and wealth-sharing, the thought was that organizations will still remain to work under any environment. But as the system boundaries of the organization become more permeable to the environment, the bigger question that we are asking ourselves is 'Can one of the most profitable oil-companies,for example, get away with continuous rigging of oil fields around, without investing in research and technology around Hydrogen Fuel Cells or similar alternative source of energy?'; The answer to that is becoming a louder 'No' these days. The next question therefore is, are the people and the leaders in the organization geared up to achieve the purpose of CSR through a structured approach, like having it set as part of their Key Responsibility Area? Does the organization indulge in CSR in an effective way, without going thin-spread on a large number of activities and therefore diluting the 'effectiveness' or 'impact' in the most fundamental way it is required to?
The case study was further intensified when a scenario around social networking was coupled in, where there were a few thousand Facebook comments on how the organization has tried to use influence to subdue the resistance through local political influence and police. There was a 10-point simulation that followed, over and above this, reversing and straightening the statements and the assumptions around the case each time.
Concept to Execution- A Case Study At United Breweries, for example, CSR is a continuous research-andapplication area with a certain belief and execution rigour - the fact that Business Manager
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A CASE STUDY FROM UNITED BREWERIES LTD.
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no business can exist without impacting or being impacted by the environment it operates in.It's this belief that has led United Breweries to think beyond their business, beyond the breweries. For the organization that has come up through years of legacy, acquisitions and mergers, CSR is a culture-fabric with the belief that it is not sporadic acts of charity but that of partnership with the environment. As part of the continuous evolution and approach to CSR, UBL has instituted, through a collaborative mechanism with stakeholders (internal and external) a concentrated focus on just four areas of CSR. The rationale behind this approach is a wellstudied initiative that answered a few fundamental questions: 1. Is the organization in a position to support a specific activity long term, once committed to it 2. Does the activity lead to sustainable advantage on the people, planet and profit parameters 3. Are the activities viable and feasible, and can they be supported through a balanced scorecard 'concept-to-execution' stage? Considering years of experience and leadership in the market segment (part of the larger environment we operate in) UBL operates in, the 4 areas were factor-analysed into the following: 1) Primary health and welfare 2) Primary education 3) Water management 4) Contract farming. Primary Health and welfare United Breweries dedicates one section of the CSR effort with an attempt at wellbeing of the society which the organization believes starts with the good health of its people. From running primary health care camps in the vicinity of the breweries in association with local governing bodies, to providing infrastructure to existing dispensaries and organising awareness programs, primary healthcare remain to be the centre of UBL's focus area. There are various initiatives at an execution level which are conceptualized, implemented and tracked - from immunization drives and eye camps to first-aid training and HIV & AIDS awareness programs, the objective of the initiatives is to foster good health& also to makeprimary health care more accessible and affordable. Mobile medical services in Srikakulam in identified villagestreat hundreds of villagers on a weekly basis.In Nelamangala close to Bangalore, more than 900 families today benefit from the health centre set up for them.In remote Kalyani close to Kolkata, the visually challenged have the opportunity for free check-up camps - some of the measured and tracked initiatives in addition to a large set of activities in the environment around the breweries in Aurangabad, Rajasthan, Mumbai, Mangalore, etc. Primary Education UBL understands the value of education - having years of 'smartswarm' knowledge management around distribution channels, networks, point-of-sales and the beer market in general, the organization understands that a significant majority of tomorrow's workforce may be from the 'bottom of the pyramid' - people not as privileged as others, but with significant talent in-built. A belief of this is in its execution of this second section of CSR in giving children the right to basic necessities and joys of education. From catering to their daily needs to facilitating their education, United Breweries Ltd contributes towards the development of underprivileged children in its own humble, yet effective way. This includes active involvement with primary level schools - ranging from distributing uniforms, sponsoring schools, organizing midday meals to providing vocational training to students with special needs. Support is kept at a simple level, with an attempt to ensure long term impact - like modernization of education through teaching aids and academic tools to enrolling and retaining maximum number of girl students. More than 2500 students in villages around the breweries have benefitted from the initiatives - with a lot more unmeasured numbers who have been drawn 52
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UBL understands the value of education having years of 'smartswarm' knowledge management around distribution channels, networks, point-ofsales and the beer market in general, the organization understands that a significant majority of tomorrow's workforce may be from the 'bottom of the pyramid' - people not as privileged as others, but with significant talent in-built. A belief of this is in its execution of this second section of CSR in giving children the right to basic necessities and joys of education.
A CASE STUDY FROM UNITED BREWERIES LTD.
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towards education on a long term, understanding its importance. Water Management Possibly as a closest fit to the organization theory on 'Contingency', is UBL's initiative on water harvesting. As a classic example of an industry heavily dependent on the environment, and therefore requiring to restore the parameters affected, UBL's business viability is heavily dependent on water- both quantity and quality; and from the contingency perspective therefore, necessitating the requirement to device means to conserve it not just from the socially-responsible perspective, but from the sheer business-viability perspective. With the latest technology in sourcing, processing and discharging water, the organization realizes that providing safe drinking water as well as water for domesticpurpose to the neighbourhood would go a long way in fulfilling a big responsibility. Every brewery is mandated with this specific responsibility. Every factory-head has a KRA associated with this initiative. Breweries are sponsoring studies in a closely coordinated academia-industry interface on brewery 'spent-water' usage for agriculture - a study of growing crops with ETP treated water, with no hazards associated. Contract Farming With a research project started in 1992, United Breweries, in association with the Directorate for Wheat Research, the Punjab Agricultural University and the University of Agricultural Sciences,Dharwad, has helped develop high-yield varieties of barley. Entering into contracts with farmers, United Breweries has helped turn the tide for farmers, making them less dependent on the monsoon and traditional high-risk crops - and in turn using the crop as part of the one of the most important raw material (malt from barley) for the final product, which is beer. The result is what started out as an experiment on 500 acres of land in 2003 has grown into 25000 acres today, with United Breweries buying barley from its framers at prices higher than government-supported prices. This, in turn, has given over 4500 farmers access to a better, more consistent quality of life.
Possibly as a closest fit to the organization theory on 'Contingency', is UBL's initiative on water harvesting. As a classic example of an industry heavily dependent on the environment, and therefore requiring to restore the parameters affected, UBL's business viability is heavily dependent on water- both quantity and quality.
The Broader Perspective The 'World of UB' as it is known internally, is a study of the impact on stakeholders. As part of a larger research area, UBL considers a much broader perspective of CSR, considering the environment, stakeholders and other macro and micro parameters - and is working on a measurement index of effectiveness of the CSR initiatives on the different sections of the stakeholders.
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A CASE STUDY FROM UNITED BREWERIES LTD.
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CSR and Human Resource Methodologies- The Sustainability Link At UBL, as part of a larger sustainable effort in terms of building the culture of corporate social responsibility in the long run, the organizational processes have been aligned towards CSR. These start right from the human resource practices in the organization: 1) Having interview sections specifically focused on CSR perspectives, for senior business positions/roles in the organization. 2) Implement continuous learning and growth objectives in 2 different ways: a. Encourage and track Subject-Matter-Experts and content being delivered by them related to CSR b. Build CSR as part of KRAs of all business leads through a balanced scorecard approach 3) UBL Code of Conduct statement emphasizes CSR ("‌The Management considers Corporate Citizenship/Social Responsibility to be an integral part of the business plan‌") 4) Organizational climate surveys have specific section on CSR - the organization's approach and employee participation. 5) Work in progress: a. Recognition of special initiatives on CSR that is within the defined boundaries and yet unique (Innovation on CSR) b. Having fresh perspectives on CSR through academia-interaction (trainees being taken from top schools in the country for short term projects on CSR)
The CSR Capability Building and Challenges The statement in the earlier section of this document "the belief that it is not sporadic acts of charity but that of partnership with the environment" means that UBL as an organization has attempted to focus on capability building in the context of Corporate Social Responsibility. Starting from the Human Resources roadmap and focus on Corporate Social Responsibility to the bigger business 'inspiration', UBL believes that sustenance of a CSR activity can only be possible through capability building and focus on the same. Integrating learning of a CSR activity initiated at a unit across others, considering environmental factors, is enabled through two major platforms - 'Drishti' and the annual HR meet, a knowledge management 54
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Integrating learning of a CSR activity initiated at a unit across others, considering environmental factors, is enabled through two major platforms 'Drishti' and the annual HR meet, a knowledge management forum attended by topmost leaders in the organization.
A CASE STUDY FROM UNITED BREWERIES LTD.
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forum attended by topmost leaders in the organization. Work is in progress to facilitate standardized group trainings on major areas of CSR and customized projects. There are discussions with suppliers to ensure their alignment with CSR at their level, in the form of backward integration. Unit-level CSR dashboards and audits are planned from an improvement perspective, not compliance perspective. Apart from stakeholder expectations on CSR, discussions are on the table for more active involvement of civil societies in pilot projects. It is interesting to understand where the organization should intervene, and in what capacity. For a successful CSR initiative and also a sustainable one, specific CSR activities have to be controlled at an organizational level, whereas others, at an interface of the organization with the environment, and still others, at the environmental level itself. In a typical supply-chain parlance, this is possibly the De-Coupling point of the CSR value chain, and it is important to identify that for an effective implementation.
The challenges are bigger in terms of moving from a cost mind-set to an investment mind-set in the area of CSR. Since many of the factories do not have the systems in place to track relevant data and measure cost Vs. benefit of the CSR initiatives, it becomes difficult to continue reinvesting in newer initiatives. Even the pilot projects, though high on the learning front, lacks prior data to be able to benchmark. Absence of a strong case study also hinders motivation to move further on innovative CSR activity implementation. BM
References and Acknowledgements 1. Team UB - Manufacturing units, Human Resources team. 2. Designing Your Organization: Using the STAR Model to Solve 5 Critical Design Challenges; Amy Kates, Jay R. Galbraith; John Wiley & Sons, 2007. 3. Organizational strategy, structure, and process; Raymond E. Miles, Charles C. Snow; Stanford University Press, 2003. 4. Strategic Corporate Social Responsibility: Stakeholders in a Global Environment; William B. Werther, Jr., David Chandler; SAGE, 28-Apr-2010. 5. Corporate social responsibility: guidelines for top management; Jerry W. Anderson; ABC-CLIO, 1989. 6. Corporate social responsibility: balancing tomorrow's sustainability and today's profitability; David E. Hawkins; Palgrave Macmillan, 04-Sep-2006. 7. Global practices of corporate social responsibility; Samuel O. Idowu, Walter Leal Filho; Springer, 22-Dec-2008. Business Manager
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ISTD 42nd National Convention at Kolkata The Indian Society for Training & Development (ISTD - www.istdtrg.org) is a national level professional & non-profit society that was established in April 1970. ISTD has a large membership of individuals and institutions involved in the area of training and HRD from Government, Public and Private Sector Organisations & Enterprises; Educational and Training Institutions and other Professional Bodies. ISTD is affiliated to the International Federation of Training and Development Organisations (IFTDO), USA and Asian Regional Training and Development Organisations (ARTDO), Manila. ISTD organises National Conventions in different cities of India. The 42nd convention has been organised at Kolkata - the 'City of Joy'. The Kolkata Chapter (www.istdkolkata.org) is hosting this convention. This Chapter is playing significant roles in achieving the ISTD Mission; has distinguished itself as evidenced from the bagging of 'Best Chapter Award' three times including for year 2010-2011. This chapter has the experience of organising Regional Convention in 2003 and two National Conventions in 2000 and 2004. The theme of the convention is, 'Value Creation through Human Development - The Emerging Dimensions'. The concept of 'value' has changed over time; and the perception of
value creation has also changed. Acquiring land was considered as value creation during agricultural economy. Value creation embraces men, materials and machinery in the industrial economy. In the epoch of 'corporation" establishing bridges of relationship with customers, employees and investors is 'value Creation'. Whatever be the nature of economy, value is created by the humans. Keeping this in mind the six sub-themes pertinent to this contemporary theme include 'Leading High Performing Organisation - The CEO Panel' and 'Innovative HR Strategies for Attracting, Shaping and Retaining Talent - The HR Head Panel'. Papers were sought on four sub-themes: Human Development for Business Excellence; Strategic HR for Value Creation; HR as the facilitator for values and ethics; and Leadership Development for Competitive Edge. Authors from academia and industries engaged in diverse functional areas have contributed articles and research-based papers. The convention proceedings will contain more than fifty such articles and papers. The proceedings will be brought out by a leading and internationally acclaimed publisher. Delegates from different corners of India and abroad will attend this convention. Speakers with ocean of knowledge with share their knowledge and experiences in open and
technical sessions. On attending this convention the delegates will gain insights on multiple aspects of enhancing the 'values' of human resource that are the source of optimizing other resources. The take away from the convention would be useful in the rest of the work life and as well social life. The venue of the convention is Science City - a place of tourist interest. In spare times the delegates can enjoy any of the several events within the Science City complex. After the knowledge inputs on the first day, the delegates will be able to rejuvenate and invigorate them attending the cultural extravaganza. The convention tariff is nominal for members as well as non-members with special concession for students and academicians. At last though not the least, all members of the steering committee and subcommittees are working individually and as well as members of teams. The inter-team harmony and synchronization is likely to make the convention a grand success. Various sponsors have extended their helping hands; media partners are doing their best. What we lastly need is your participation; the deliberations will be useful for you and us. Therefore, participate - gain enhance your knowledge reservoir- accumulate for dissemination.
BKT Bhiwadi Conferred National Energy Conservation Award
(Sketched by Dr. U K Haldar)
BKT - Bhiwadi plant has won the highest awards at " National Energy Conservation Awards-2011 from Ministry of power , Government of India " at a Glittering function held at Vigyan Bhawan , N.Delhi on 14th December,11. This award was given by Union Cabinet Power Minister , Sh. Shushil Kumar Shinde ji. On Behalf of Bhiwadi Team this award was received by Narender Kumar, V.P. Operations. “We were adjuged the best efforts in Tyre sector and was given 2nd position at National level. .This award has been given to us for our energy conservation efforts in 2010-2011, amounting to over Rs.180 lacs”, said Narender Kumar, V.P. Operations. This is a third year in row efforts from Bhiwadi plant at National level ( 1st in 2009 , 2nd in 2010 )… and hope to continue the journey here after also.
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Workshop on Managing Excellent Industrial Relations
Anil Kaushik
Delegates
IR Workshop
The Workshop conducted at Gurgaon on 16th Dec., 2011 aimed at creating a deeper understanding of the Behavioral, Administrative and legal aspects influencing harmonious Industrial Relations climate in an Industry and Region and to facilitate the Managers in taking appropriate decisions on a pro active basis and also to develop strategies to tackle any unrest in the Organisation when it happens.
J
uris HR in association with Business Manager-HR Magazine organised one day unique workshop on Managing Excellent Industrial Relations on 16th Dec. at Gurgaon.
The Workshop aimed at creating a deeper understanding of the Behavioral, Administrative and legal aspects influencing harmonious Industrial Relations climate in an Industry and Region and to facilitate the Managers in taking appropriate decisions on a pro active basis and also to develop strategies to tackle any unrest in the Organisation when it happens. At the outset, Mr. A.S.Sharma, CEO- Juris HR briefed the participants about the Workshop schedule for the day. Analysing the previous instances of Labour unrest in the neighboring area, and extending the concept of managing a joint family defined Industrial Relations as an "Art of Living Together" wherein prosperity for all the stakeholders flows as a consequence. Mr. Anil Kaushik- Management Expert-HR & IR & Chief editor "Business Manager" magazine, created a thought provoking atmosphere by screening various audio visuals thoroughly describing the anatomy of Industrial strikes in the recent past not only in NCR Region but other parts of the country as well. He analysed in detail the reasons leading to those unfortunate events and the pro active actions that could have prevented them. Mr. Kaushik also elaborated on the measures that if taken could have prevented aggravation of the situation. Active interest displayed by the participants through their inquisitive questions made the session highly participative and learning. The afternoon session by Mr. Alok Bhasin, Advocate, a practitioner and consultant of Labour Laws provided the participants an exposure to the various Statutory provisions that need to be taken care of under those circumstances. He gave reference of rulings of various courts explaining the reasons behind such
A.S. Sharma
decisions. Mr. Bhasin conveyed that the courts are not indifferent to the needs of the changing industrial climate in the country as amply indicated by the trends in the judgements. Mr. Kallol Roy, with his vast experience of managing the workforce at shop floor at micro and macro levels at senior positions in Maruti, Krishna Maruti and as MD of KUMA- Manesar, currently functioning as CEO- JK Organisation gave the participants deep insights on the effects of a strong positive and participative culture in an organization. He emphasized that this insulates an Organisation from negative vibes within. The Workshop received overwhelming support from the practicing senior managers in HR as well as non HR areas. The feedback confirming excellent learning from the sessions has been a source of encouragement. BM Business Manager
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HR Summit at JKLU, Jaipur
Yaduvendra Mathur
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he HR Summit on "Business Transformation and Organization Excellence: The Evolving Role of HR" was inaugurated on November 26, 2011 by Mr. Yaduvendra Mathur, Chairman & Managing Director, Rajasthan Financial Corporation with lighting of the holy lamp and invoking blessings of Goddess Saraswati. Dr. B.V. Babu, Director, IET, JKLU introduced JK Lakshmipat University to the audience.He said that vision of the university is to encourage a value based innovative learning environment that engages deep intellectual, spiritual and moral stimulation, to promote holistic personality development for nurturing leadership.He further mentioned that mission is to practice a 'mentoring' based education system with intellectual, moral and spiritual culture of its own rooted in Indian ethos while in tune with the global vision of the times besides inculcating learning through understanding, knowledge enhancement, skill development and positive attitude formation and encouraging innovative thinking,which would develop a mindset for action without fear, with self-discipline and care for society.
Dr. Upinder Dhar
Dr. SantoshDhar, Professor, IM, JKLU and Coordinator of the Summit introduced the theme.In her briefing, she saidthat success for any organization comes from its ability to transform the business to address changing market conditions. To drive the proper transformation at critical points is key to long-term success. "Business as usual" is an expression that can mean certain death over the long run. Being able to grow and reinvent offerings is critical to
JKLU HR Summit
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Amit Varma
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addressing economic volatility, staying on top of the market, and remaining competitive. Gaining and retaining competitive advantage is critical to an organization's growth, prosperity and excellence.Business Transformation requires change which may be change in management style, culture, organization structure and/or product. She pointed out that Transformation can be quite radical and fast - involving a departure from the established and comfortable current state - or it can involve a series of substantial changes that, when strung together, transform the organization and lead to excellence. Business Transformation is a change management strategy which has the aim to align People, Process, and Technology initiatives of an Organization more closely with its business vision and strategy. Although organizations may pursue many paths to this end, one that is frequently not recognized is capitalizing on effective human resource management.She stressed upon the significance of people resources in any organization and asserted that people are the key resources that differentiate the successful organizations from those which are not so successful. She further stated that keeping these people resources motivated and aligned with the organizational objectives is a big challenge. Dr. Upinder Dhar, Vice Chancellor, JKLU, delivered the welcome address. In his address, he emphasized upon the changing workforce dynamics in terms of changing value systems, demographics and skill sets.He briefed the audience about the changing nature of organizations and asserted that the speed of change is also increasing. India's population offers it a demographic advantage over other countries and highlighted the need to convert this advantage into human capital.He further added that to achieve organizational excellence through business transformation, organizations should continuously strive to achieve excellence in whatever activities they undertake. Mr. Yaduvendra Mathur, Chairman & Managing Director, Rajasthan Financial Corporation delivered the inaugural address. In his address, Mr. Mathur threw light upon the significance of Integrity, Morality, Ethics and Legality for transforming the individuals and then subsequently achieving organizational excellence. He also emphasized that integrity is not a normative or judgmental concept but is an objective one.A paradigm shift occurs when we distinguish that the only way in life is to restore integrity by admitting when and where and with whom we have not honored our word.Leaders do not only keep their word but they distinguish when it is not required to keep their word but to honor their word.Mr. Mathur concluded by suggesting that all of us have to play the role of an HR professional at some or the other point of time and we should always be ready and willing to honor our word. Mr. Amit Varma, President, Corporate Strategy, JK Organisation was keynote speaker on
the occasion. In his keynote address, Mr. Varma opined that excellence is a much desired phenomenon but in reality is a very difficult one to achieve.Sustainability and continual innovations represent the major challenges that organizations face today. He suggested that transformation and excellence should be sustainable and replicable over time and across a wide range of business issues and situations.He shared his experiences with JK Organisation and illustrated the manner in which JKO was able to achieve excellence through continual transformation over a period of 100 years. Mr. Bivash Mukherjee, Manager - Training, HR & PA, Genus Power Infrastructures Ltd.was the first speaker of the plenary session.Mr. Mukherjee, in his opening remarks, stated that contrary to popular beliefs, HR is no longer just a pink-collar job but has evolved into a more demanding profession.HR function faces the challenge of identifying victims, non-believers, and know-it-alls in an organization.He asserted that the onus of creating an 'open-to-change' culture in an organization is on the HR function. He further emphasized the need of Training and Development interventions to achieve organizational excellence. The second speaker of the plenary session was Mr. Anil Kumar Singh, Circle Head - HR, Aircel Ltd.Mr. Singh, in his deliberation, shared the business transformation model which he himself developed and implemented at Aircel.He emphasized upon the channelization of raw energy of individuals in any organization.He asserted that chaos is going to be the order of the day and HR has to become more critical while dealing with people. He stated that as an evolving function, HR people should be out on the field and look for opportunities by being with the environment. He concluded by saying that new ideas and thought processes are required at the strategic level, speeding up and creating new channels is the need at the middle management level; and rejuvenation & intensification for the front liners. The third speaker of the plenary session was Mr. Anil Kaushik, Management Consultantand Chief Editor -Business Manager.Mr. Kaushikhighlighted the evolving role of HR from compliance administrator to partnerships with stakeholders; from transactional change to transformational change; from slow, reactive, fragmented to fast, proactive and integrated. According to him, HR cannot operate in solo,it must soil its hands; it has to be credible, risk taking and has to work in collaboration with business leaders.Those who aspire to be HR professionals must be ready to accept the fact that HR is no longer a soft function and there are a lot of newer challenges which a future HR manager will be faced with. The Summit concluded with Prof. Ashwini Sharma presenting report of the proceedings and Dr. NitinGoyalproposing the Vote of Thanks. BM
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Women Entrepreneurship: Unplugged!!
I
ndus Business Academy (IBA), Greater Noida in association with Delhi Management Association (DMA), New Delhi organized the 2nd Women Entrepreneurship Conference on "Women Entrepreneurship: Unplugged!!" on 15th December 2011, at Lok Kala Manch, New Delhi. This one of its kind conference focused on several issues pertaining to women entrepreneurship including social, technical and psychological aspect. These agendas were further highlighted and supplemented by the success stories and learning experiences of both renowned and the unsung heroines. The inaugural session started off with the welcome address by Mrs. Neena Malhotra, President, FICCI Ladies Organization (FLO). This was followed by conference overview presented by Prof. Manas Garai, Professor, Marketing & Convener, Incubation Centre, Indus Business Academy, Greater Noida. The keynote address was delivered by Dr. Rajnee Aggarwal, President, Federation of Indian Women Entrepreneurs (FIWE), where she focused on the "importance and significance of women entrepreneurship which is immense and multifaceted because it is not only limited to 'independent' and 'empowerment' of the women but also leads to prosperity of family, society and the nation as a whole. Despite having such importance, women entrepreneurship is still full of dichotomy - 'family vs. job', 'safe & salaried job vs. small business, 'logic vs. intuition'." Guest of Honor, Mr. K.G. Alai, Chief General Manager, & Head - Northern Region, SIDBI shared about the various schemes offered by SIDBI to women entrepreneurs for starting up their business. The Chief Guest, Mr. Arvind Chandran, Joint Commissioner, Industries, Govt. of NCT Delhi, finally blessed all the participants and discussed about the different facilities provided by the government to the women entrepreneurs. The second session was based on "Emerging Business Opportunities for Women" chaired by Ms Ester Martinez, Co-Founder & Managing Partner, People Matters. Other renowned speakers were Ms Meenu Vadera, Founder & Director, Sakha Cabs (Delhi's first
ladies cab for women), Ms Shailja Dutt, Founder & MD, Steller Search and Selection, Ms Sairee Chahal, CEO, Fleximoms, Ms Bertha Cooper Rousseau, Managing Partner, R&C Law, Bahamas, Dr. Shikha Sharma, Founder Managing Director, Dr. Shikha's Nutrihealth Systems Pvt. Ltd. This session enlightened on the new and creative as well as emerging business opportunities for women. These successful ladies also shared their entrepreneurial journey and their success stories with the audience. The next session on "Funding Mantras" discussed the financial issues involved in women entrepreneurship and was chaired by Mr. Raj K Pathak, CEO, Yuvaudhyami.com.The other panelist were Ms Alaknanda Kumar, MD, Kumar Agro Foods Pvt. Ltd., Mr. D.S. Tripathi, General Manager, Union Bank of India, Mr. R.K. Das, General Manager, SIDBI and Mr. Sandeep Sinha, Managing Partner, Lumis Partners. These speakers shared their view on "various funding options" available to start the business and the special schemes provided by SIDBI and other Banks to the women entrepreneurs. Ms Kumar also shared her entrepreneurial journey with the participants. The final session on "Cost Effective Ways to Create Brand and Sales Leads" highlighted the latest cost effective ways like social media platforms such as Facebook, Twitter, Linkedin etc. being useful to generate business leads and increasing sales. The session was moderated by Dr. Neena Sinha, Professor, GGS IP University and the other panelists were Ms Pooja Kumar, CEO & Founder, SME Networks Pvt. Ltd., Ms Seema Giri, COO, Astrowix.com and Ms Sanjukta Basu, Founder & Director, Samyukta Media. The conference was very well received and appreciated by the 100+ delegates representing existing women entrepreneurs and wanna-be entrepreneurs from different backgrounds. The session finally concluded with the vote of thanks proposed by Dr. Ekta Saxena, Program Director, 2nd Women Entrepreneurship Conference and Head-Corporate Relations, Indus Business Academy. BM
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IBA Mega HR Conclave
D
MA (Delhi Management Association) and IBA (Indus Business Academy) organized 3rd Mega HR Conclave, on November 24th at Hotel Radisson, Gurgaon. The theme of this one day conclave was "Paradigm Shift in HR Strategies to Enhance Customer Value". The event began with the welcome address by Prof. Sundermoy Sen, IBA followed by program preamble.
initiative". Mr. Vivek Tripathi talked about engagement being enablement. Third session on "Innovation & Creativity: Breakthrough in HR Practices through Technology and Networking" was chaired by Mr. Aquil Busrai, CEO, Aquil Busrai Consulting and other speakers were Mr. Rajesh Rai, Director HR, Benetton India Ltd, Ms Suchitra Rajendra - Director -Organisation Capability - Pepsico India Region,
The event was graced by esteemed speakers from the HR fraternity including HR Heads from corporate bodies such as GSK Consumer Health Care, Arcelor Mittal, J.K. Organisation Ltd., Schneider Electric India Pvt. Ltd. , Super Religare Laboratories Ltd., Lava International Ltd., PepsiCo, United Colors of Benetton, Clickable.com, NTPC Limited, Whirlpool Asia, Dalmia Bharat Enterprise Ltd., Orient Craft Ltd.
Gautam Ghosh, Product Evangelist & India Marketing, BraveNew Talent and Sandeep Sahi, Managing Director, Clickable.com. They discussed about how new technology and networking influence HR Strategies and practices.
The program was divided into four sessions. During first session, Guest of Honour Mr. Sudhir Sinha, Country Head-CSR, Arcelor Mittal talked about strategic corporate sustainability management. Key-Note Speaker of the conclave Mr. Arun Sehgal, Executive VP-HR, GSK Consumer health care discussed about enhancing values for customer and stake-holders. Dr. P.V. Bhide, Group President-HR, J.K. Organization, Chief Guest of the conclave shared his views on paradigm shift in HR strategies to enhance customer values. Second session was on "Competitive Advantage and Employee Engagement", session was chaired by Dr. P.V. Bhide and other eminent panelists were Dr. Shalini Sarin, Director and Country HR Partner, Schneider Electric India Pvt. Ltd., Neeraj Goel, Chief People Officer, Super Religare Laboratories Ltd. and Vivek Tripathi, CHRO, Lava International Ltd. Dr. Sarin emphasized that "Employee Engagement is at the heart of effective leadership, it is not an options or another
Lastly, the event commenced with the final session on "Sharing Best HR Practices for Value Proposition by HR Practitioners". Mr. Udai Upendra, Founder and CEO, The HR Company was the session chairman. Avinash Chandra Chaturvedi, Executive Director, PMI, NTPC Limited, Anil Garg, Vice President-HR, Whirlpool Asia, M. L. Chakraborty, Assistant Executive Director- HR, Dalmia Bharat Enterprise Ltd., Paramjit Lamba, AVPHR, Orient Craft Ltd. shared best HR practices of their respective companies. This session was very well appreciated by the audience and raised many questions to the panelist. Selected participants have also shared their views and HR practices with the audience. They addressed the gathering with detailed presentation on attraction, development and retention, focusing on key aspects such as talent expectations, why employees stay, succession management and long term employee engagement. The conclave came to an end with vote of thanks was proposed by Dr. Ekta Saxena, Program Director for the 3rd Mega HR Conclave and Head -Corporate Relations, Indus Business Academy, Greater Noida. BM Business Manager
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FORECAST
Hard to find talent in 2012 ? The year flew by mostly because it was a very, very busy one. Although the economy continues to face many challenges, the startup and tech industries are very much alive. The IPO window slightly opened up for companies like LinkedIn, Pandora, Groupon, Zynga, and Carbonite. We saw monster rounds of funding for companies like Facebook, Twitter, Dropbox. The appetite for seed and angel investing was extremely active. Tech incubators and accelerator programs kept popping up. It was also a very busy year for hiring at startup companies, as you know, and it doesn't look like that will slow down in 2012. We've certainly seen opinions on both sides of the fence as to whether or not there is a tech bubble or 2012 will be another active year of investing. I'm an optimist and I believe the pace of investing will remain consistent. Yes, some companies will fail, of course, but others will scale and grow their teams at a steady clip. Hiring the best of the best is an absolute must if you are going to build a successful company. You will need to be prepared to compete against big companies with deep pockets and other up-and-coming startups that also have blue chip investors and a game-changing idea. So, what are the most competitive areas for talent these days? Here's a look: Software Engineers and Web Developers : The demand for top-tier engineering talent sharply outweighs the supply in almost every market especially in San Francisco, New York, and Boston. This is a major, major pain point and problem that almost every company is facing, regardless of the technology "stack" their engineers are working on. Creative Design and User Experience : After engineers, the biggest challenge for companies is finding high-quality creative design and user-experience talent. Since almost every company is trying to create a highly compelling user experience that keeps people engaged with their product, it is tough to find people who have this type of experience (especially with mobile devices including tablets) and a demonstrated track record of success. Product Management : It is always helpful for an earlystage company to hire someone who has very relevant and specific experience in your industry. This is especially true for product management, since the person in this role will interface with customers and define the product strategy and use cases. However, be prepared, as it will be a challenge to find people with experience in these high-growth industries: consumer web, e-commerce, mobile, software as a service, and cloud computing. Marketing : I'm not talking about old-school marketing communications. Companies are looking for expert online marketers who know how to create a buzz of inbound marketing or viral traffic through the web, social media, and content discovery. Writing a good press release just doesn't cut it anymore, as everyone is looking for the savvy online marketing professional who understands how the current state of the web operates and knows how to make it work to their benefit. Analytics : Since data is becoming more and more accessible, smart companies are increasingly making decisions driven by metrics. Analytics is becoming a central hub across companies where everything (web, marketing, sales, operations) is being measured and each decision is supported by data. Thus, we are seeing a high level of demand for analytics and business intelligence professionals who almost act like internal consultants; they help determine what should be measured and then build out the capability for a company. 62
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Excellence in IT Award for AISECT Bhopal-based education group AISECT has won the prestigious CSI 2011 Award for Excellence in IT for its initiatives in the area of Human Resource Development through Education. The national award which included a cash prize of Rs. 1 Lakh, was announced during the 46th Annual CSI Convention held in Ahmedabad and has been instituted by the Computer Society of India to acknowledge and motivate innovation and indigenous development in the filed of Computer Science and Technology. The CSI Awards were announced across six major categories and AISECT has won this coveted award in the category 'Human Resource Development through Education' for the pioneering work that the organization has done over the last 26 years in the area of propagating IT Education in semi-urban and rural India. AISECT's CMD Mr. Santosh Choubey said, "It feels great when the hard work of the team gets recognized on such a prestigious national platform. Such recognitions encourage us to work with even more dedication towards reducing the IT and technological literacy gap between urban and rural India and propagating effective and sustainable employment solutions for India's less developed area."
PF gets precedence over other arrears : SC In an important ruling, the Supreme Court has held that recovery of employees' provident fund (EPF) dues from a company under liquidation would get preference over arrears due to banks,financial institutions and the government. However, it clarified that other dues of employees cannot get precedence over the debt of secured creditors once EPF commitments are met.The apex court said that "the mere ranking of the dues of workers on par with debts due to secured creditors cannot lead to an inference that Parliament intended to create first charge in favour of the secured creditors and give priority to the debts due to secured creditors over the amount due from the employer under the EPF Act." It upheld the Employees Provident Fund Commissioner's plea challenging the concurrent findings of the Company Law Board and the Bombay High Court, which had held that secured creditors would have priority over the dues collected from the liquidated company's assets. While interpreting the conflict arising out of Section 11 of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, and Section 529A of the Companies Act, 1956, the court said Parliament amended Section 529(1) of the 1952 Act to ensure protection of workmen in winding up proceedings. "The object of this amendment is to place the legitimate dues of workers at par with those of secured creditors. This is also a legislative recognition of the fact that the workmen contribute to the growth of the capital and industry," it said.
HR News
Tata’s Taj HR practices made employees to sacrifice their lives for Guests Unpacking HR policies of Taj The Taj HR Handbook...
....And Its Heroic Practice on 26/11
A recruitment system that hires for character and not for grades
A 20-something banquet helped guests escape
Training programmes that not just mentor employees but also empower them to take decisions
Telephone operators stayed at their posts and alerted guests to stay indoors
A reward programme that recognises employees on a real-time basis
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Staff forming a human shield to protect guests at the time of evacuation 11 employees perished saving lives
In the weeks that followed 26/11--the day on which rampaging terrorists killed some 150 people at 10 locations in South Mumbai, including 11 employees of the Taj Mahal Palace hotel-Ratan Tata made visits to some of the bereaved families. The chief of the Tata roup, which owns the Taj via group company Indian Hotels, met a woman who pointed to the garlanded figure of her late husband and said : "My children never realised their father was a hero." It took Tata by surprise, as he expected to encounter anger and sorrow. The above anecdote is narrated by Rohit Deshpande, professor at Harvard Business School (HBS), who was interviewing Tata for a five-part video case study on crisis management at the Taj during 26/11. Deshpande started to teach the course at Harvard from October 2010. His students, especially non-Indians, were transfixed by the topic and were incredulous why employees were willing to give up their lives when they had the option to flee. The student reaction prodded Deshpande, along with Anjali Raina, executive director at HBS India Research Centre in Mumbai to delve deeper into the HR practices of the organisation. The uncommon valour of those who worked at the Taj convinced the duo to research the human resource (HR) practices of the organisation. After all, here was an extremely rare case of employees placing the safety of guests over their own well-being; and in the process some of them sacrificed their lives. "We wondered whether the HR best practices made them do this and decided to dig deeper into the HR processes," said Deshpande, while Raina added that : "It was intriguing to unpack the Taj approach to HR and speculate on the linkages between the hotel's HR policies and practices and the customer service experience." The research of Deshpande and Raina spanned more than a year. They began by asking for manuals, wondering if there was training given to these employees for an incident like this one. There was none. An intrigued Deshpande started to research the HR practices of the company and found three pillars of practices that explained the courage and actions of employees : A recruitment system that hires for character and not for grades; training programmes that not just mentor employees but also empower
them to take decisions; and a reward programme that recognises employees on a real-time basis. "I teach both MBA and executive programmes. In may experience, these practices have been unique," Deshpande said. Just one aspectthat of recruiting from small towns and recruiting for attitude rather than grades-was unheard of, he added. This research is interspersed with tales of employee heroism-a 20-something banquet manager helping guests escape; telephone operators staying at their posts and alerting guests to stay indoors; and staff forming a human shield to protect guests at the time of evacuation. One executive chief at the hotel told the researchers that other groups have tried to hire him, but he refused to go. Reason: There is a connection with the guests. Generations have come to the Sea Lunge for matchmaking and weddings are celebrated in the Crystal Room; and waiters have been serving people for generations, the researchers were told. "(At a time when) we are hearing so many stories of human frailty, mismanagement, moral turpitude, the Taj research is about ordinary people who became heroes. It's about leadership from everywhere, especially leadership from below," said Deshpande. The context for the students and organisations is to learn about HR practices that have been put together on unique criteria, said Deshpande. The culture of employee-empowerment has been ingrained in the Taj workforce for some time now. For instance, the researchers found similar displays of gallantry at the Taj properties in Maldives at the time of tsunami in December 2004. "I realised that just like the character of a human being is the sum of choices made over the years, the culture of an organisation is the sum of values, policies and practices consciously fostered over the yeas," said Raina.
EPFO for amendment to restrain new exempted trusts The government may not allow new exempted PF trusts to manage employee funds. Companies with such funds would be allowed only to maintain accounts of their employees, while the EPFO will invest the corpus and offer interests to its subscribers accordingly. A provision in this regard is likely to come in the EPF Act amendment note that is expected to go for Cabinet approval soon. If approved, the new norm would discourage a lot of companies to opt for exempted trusts. There are around 2,770 companies including both in private sectors and public sector that have exempted establishments for
PF. According an EPFO official, the rule will not be allowed to the existing set-ups. "There have been many cases in the past where exempted thrusts have expressed their unwillingness to match the interest rates offered by EPFO citing various reasons. If they are given the responsibility of only maintaining the employees' accounts, there would be no such problems," a labour ministry official said. Under this exemption, the companies need not give money from their employees' provident fund to the EPFO. These trusts can invest the funds on their own and assure a return to their employees accordingly. Business Manager
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More jobs to come in 2012 JOBS AHEAD Manpower Employment Outlook Survey says hiring intentions for the first three months of the new year are strongest in India, Brazil,Taiwan, Panama and Turkey, and weakest in Greece, Hungary and Italy In India, while Manpower said services, mining and construction represented the brightest hiring opportunities, the Naukri report revealed IT-software, BPO and telecom sectors-exhibited strong hiring trends. Notwithstanding the uncertainties in the global markets, hiring plans are bouncing back in the country after a slight decline in the final quarter of 2011 making employers bullish about the pace of hiring in the next quarter. Even as the world fears an economic slowdown, employment market surveys have suggested an improving employment scenario and predicted robust hiring activities for the new year. Painting a positive picture, the recent Manpower Employment Outlook Survey noted that employers in India are anticipating a vigorous hiring pace in the next quarter. This trend is being led by the information technology, banking and manufacturing companies, especially multinationals and large national corporations, which are planning to hire aggressively in the first quarter of 2012. Another report by online job portal Naukri.com has said that hiring activities surged in November across all sectors. The Naukri JobS-peak index for November saw hiring activity move up across all sectors when compared to October. "The bounce back in the November index is indicative of a seasonal spike. In November most industries increased their recruitment numbers, post the festive season lull. Therefore, while we do witness a double digit percentage hike in hiring numbers in November over October, when compared with earlier months the indices are mostly steady," said Hitesh Oberoi, CEO and MD, Info Edge, the promoter of Naukri.com. Recently, Monster.com's monthly Monster Employment Index which gauges online job demand, too, showed a continued positive growth in recruitment activity from an annual perspective, led by key industries like telecom, IT, and financial services. The reports may come as a breather for the country especially against the backdrop of contraction in industrial output and gloomy economic growth prospects. ManpowerGroup's labour market research reveals first quarter hiring expectations are positive in 31 of 41 countries and territories, with net employment outlooks declining from three months ago in 30 countries and territories. Outlooks are softer in 23 countries and territories compared to this time last year, but are stable or improved in 16. In India, while the Manpower's net employment outlooks strengthened in six out of seven industry sectors with services and mining and construction sector representing the brightest hiring opportunities for job seekers in the next three months, the Naukri report revealed that IT-software, BPO and telecom sectors- exhibited strong hiring trends. The demand for professionals in sales, accounts and HR moved up by 35%, 31% and 22% respectively over the same time period and all top metros of the country witnessed strong hiring trends. 64
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Contract Labour amendments caught-up in bureaucratic tangle A proposal to match the salary of contract labour to that of permanent staff has got caught up in a bureaucratic tangle that the cabinet secretariat has been asked to resolve. The committee of secretaries examining labour ministry proposal to provide contract workers same monetary and other benefits as regular workers has sought a more exhaustive study on its impact on various stakeholders. The labour ministry has hit back with a letter to the Cabinet Secretariat, saying the financial impact study by VV Giri National Labour Institute should suffice as it was comprehensive and covered as much ground as was possible. "The Cabinet Secretariat will now have to take call on whether the note for amending the contract labour act can be placed before the Union Cabinet for clearance," a government official told. The proposed amendment would entitle contract labour to the same wage rates, holidays, hours of work and social security provisions as that given to regular employees doing similar work. The only difference between contract and regular workers would be security of tenure. Trade unions are pressing for regularisation of all workers on contract. The new rules will hit the government the most given that it is a big employer of contract labour. The impact analysis done by the VV Giri National Labour Institute has found that the change will cost the government Rs. 11,000 crore annually, against Rs. 5,500 crore hit to the private sector. The finance ministry had expressed concerns on the financial burden that would be imposed on the Centre if the proposed changes were to be brought about in the contract labour (regulation & abolition) act. Private sector has also been reluctant to endorse the proposal. Many employers' representatives say that forcing employers to pay similar wages to both contract and regular workers will encourage mechanisation.
Asking for good conduct bond unfair : Govt Demanding good conduct bond from workers by Maruti Suzuki India management during the recent labour unrest at its Manesar plant was an "arbitrary act" and amounted to "unfair labour practice". "Demanding of good conduct bonds from workers as per conditions before allowing them to resume work is an arbitrary act and it also amounts to unfair labour practice as given in the Industrial Disputes Act, 1947," labour and employment minister Mallikarjun Kharge said. The minister stated this in a written reply in the Lok Sabha to a question by Gurudas Dasgupta of CPI and Gopinath Munde of BJP on whether there has been violation of labour laws by various multinationals, including Maruti, by demanding such bonds. Kharge said, ".....Haryana government had reported that management of Manesar plant had imposed a condition of submitting good conduct bond by workers for entering the unit as there was reported widespread indiscipline by workers and acts of sabotage and production of defective vehicles." The good conduct bond required the workers to declare they would "not resort to go-slow, intermittent stoppage of work, stay-in-strike, work-to-rule, sabotage or otherwise indulge in any activity, which would hamper normal production the factory".