CHAPTER V

PERSONNEL MANAGEMENT PRACTICES - DEVELOPMENT ACTIVlTlES

CHAPTER V

PERSONNEL IUNAGEUENT PHACI'lCES- DEVELOPMENT A C l ' l V I T l E S .

In the previous chapter, the procurement activities

like personnel policy, personnel planning, recruitment and

selection were analysed. In this chapter the development

activities of personnel management such as training,

transfer, promotion, compensation and employees' union

management relations are analysed.

TRAINING

Introduction

Once the employee is selected and inducted, he or

she must be trained to better fit into the job and the

organisation. Training is a vital activity next Only to

staffing .

Definition

David A.Decenzo and Stephen P.Robins describe training

as "a learning experience in that it seeks a relatively

permanent change in an individual that will improve his or

her ability to perform on the jobu1. Dubashi, P.R.

1. David A. DeCenzo and Stephen P. Robins - Personnel/Human Resource Management - Prentice-Hall of India, New Delhi - 1989 - p. 240

defines training "as a process of improving the knowledge

skill and attitude of employees to achieve organisational

objectives. It is only through a systematic program of

training that necessary professional knowledge is

imparted, skills developed and attitudes attuned to work

situationw2. According to Edwin B. Flippo, " training is

the act of increasing the knowledge and skill of an

employees for doing a particular jobet3.

Dale S. Beach says that "training is the organised

procedure by which people learn knowledge and/or skills for

a definite purposew4. Michael Jucius defines training as

"a process by which the aptitudes, skills and abilities of

employees to perform specific jobs, are increasedu5.

For the purpose of this study training is considered as

an essential activity to increase the knowledge, skills,

abilities and attitudes so that the employee will perform

the job better than otherwise.

2. Dubbashi P.R. - Strengthening of training facilities - Souvenir of Cooperative Training College, Bangalore - Cooperative Training College, Bangalore - 1983 - p. 1

3. Edwin B. Flippo - Principles of Personnel Management McGraw - Hill Book Company, New Delhi - 1971 - p. 194

4. Dale S. Beach - Personnel : The Management of People at Work - Macmillan Publishing Company, New York -1980 - p. 244

5 . Michael Jucius - Personnel Management - Richard D. Irwin Inc., - Hanewood, ~llinois, U.S.A - 1955 - p. 142

Training and Development

~hough the terms, "trainingn and "development" are

sometimes used synonymously, they have different

meanings and scopes. Training is a short term process

utilising a systematic and organised procedure by which the

operative employees acquire the technical knowledge and

skill for doing a specific job. It refers to technical and

mechanical operations. It is designed for non managers for

doing a specific job, to meet the present need. The

initiative for training comes from the management.

Development, on the other hand, is a long term

educational process utilising a systematic and organised

procedure by which managerial personnel get conceptual and

theoretical knowledge. It is designed for the overall

development of managers to meet their long term

requirements. The initiative for development comes from the

individual himself.

Training and Education

Training is different from education too. Education is

concerned with increasing general knowledge and

understanding of the employees' total environment. Training,

on the other hand, is concerned with increasing the

technical knowledge and skill for doing a job. Education is

broader and theoretical while training is narrower and

pactical.

Need for Training

Training is not a luxury but a necessity. It is a kind

of investment. Edwin B. Flippo opines that "no organisation

has a choice of whether to train or not; the only choice is

that of methodu6. No one is a perfect fit at the time of

hiring. Training is necessary to bridge the gap between what

they are and what the job demands. In the absence of a

systematic and planned training, employees learn their job

by trial and error method or by observation. These methods

consume more time and energy, thereby increasing the cost of

training. Even then, there is no guarantee that the employee

will learn the best method of doing the job. In order to

have effective training at reduced cost, planned training is

a must.

Existing employees also require orientation training to

avoid becoming obsolescent; to make use of new technology;

to operate new machinery: to adjust with the new

6. Edwin B. Flippo - Principles of Personnel Management - McGraw - Hill Book Company, New Delhi - 1971 - p.194

environment and to take up new jobs and responsibilities.

Training is a continuous process.

Training not only increases productivity through

increase in the knowledge and skill of the employees, but

also enhances his self confidence, brings respect to the

employee from others and reduces the rate of errors. A

trained employee is less prone to accidents.

Taimni K. K. explains the objects of training of

cooperative employees. "The purpose of cooperative

employees' training and development is to make available

professionally competent managerial and other personnel

with appropriate knowledge and skills and abilities to a

cooperative system, so that it can function in an effective

manner. lt7 In this section, the various methods adopted by

the selected units for imparting training to their employees

are analysed.

Managerial Practice

Two types of training are available to cooperative

employees, They are internal training and external training.

There are many special training agencies to provide

7 . Taimni K.K - cooperative Organisation and Management - W.A.F.M. Farmers' Welfare Trust Society, Krishak Bhavan, New Delhi - 1976 - p. 203.

cooperative training to various cooperative personnel at

different levels. There are many Cooperative Centres for

junior personnel under the auspices of state Cooperative

unions. Besides, there are 16 Cooperative Training Colleges

in different parts of India and one National Institute

of Cooperative Management at Pune under the auspices of

National Cooperative Union of India for imparting training

to middle and top level managers in cooperatives.

All these institutions provide training in the

principles, law and practice of cooperation. This type of

training is useful and available only to managerial and

clerical staff. Such institutional training facilities are

not available to technical personnel engaged in processing

or production. They mainly depend on the informal on the job

training within the organisation.

The situation in the selected cooperative units is not

satisfactory. The Pondicherry Cooperative Training

Institution now renamed as the Pondicherry Institute of

Cooperative Management conducts a certificate course in

Cooperation. The duration of the course is 10 months. It

imparts education on the theory and law of cooperation.

It also provides practical training to their students so

that they can be employed as office clerks. But the pity is

that they are not given preference in the appointment of

clerks in the cooperative societies. The persons who have

neither this certificate nor any degree in cooperation

manage to get employment in cooperative societies as clerks.

Therefore, the Institute conducts a condensed course for

three months for the benefit of employees who are already

working in the cooperative societies. So, the training

needs of clerical staff are satisfied to some extent even

though they learn their job only from their superiors and

colleagues after appointment. Thus, they receive training in

the informal way through on the job training and by job

rotation.

The training needs of managerial and technical

personnel are met differently. The National Level

Federations look after this kind of training. The Chief

Executives are trained. But they are deputationists and the

training given to them in a particular society becomes a

waste if they are transferred. The Pondiche~ry Cooperative

Milk Producersf Union Ltd. alone has the advantage of having

its own Chief Executive who possesses the necessary training

both in technical and managerial duties.

In other societies, the training of technical

Personals quite inadequate. The employees are deputed for

training only when it is organised by an outside agency,

usually the respective National Level Federations.

Table 5.1

Classification of Fhnployees on the basis of Pre-Job Training

s1. Name of the Whether undergone Total NO. Society Pre-Job Training

Yes No

1. The Pondicherry 6 7 Coop.Milk Producers1(46.15) (53.85) Union Ltd.

2. The Indian Coffee - 25 Workers' Coop. (100.00) Society Ltd.

3. The Pondicherry 15 48 coop. Ltd.

Sugar ~ i i l s

4. The Pondicherry 7 25 State Coop. Bank (21.88) (78.12) Ltd.

5. The Pondicherry 8 9 Coop. Wholesale (47.06) (52.94) Stores Ltd.

Total

Source : Compiled from the Questionnaire 11.

N.B. : Figures within brackets indicates percentage.

Table 5.1 gives particulars of employees who received

pre-job training also known as induction training. The above

table indicates the inadequacy of pre-job training

facilities to the employees of the cooperative sector in the

Union Territory of Pondicherry. In the case of The Indian

coffee Workers' Cooperative Society Ltd. the pre-job

training is nil. The employees are given on the job training

when they are casual workers prior to becoming regular

employees. It is very high in the case of The Pondicherry

cooperative Milk Producers' Union Ltd. and The Pondicherry

Cooperative Wholesale Stores Ltd. i.e.above 45%. The overall

percentage of employees who received pre-job training is

24% which is not satisfactory.

The Table 5.2 indicates the number of employees who

received in-service training. It is also known as refresher

training or re-training. This kind of tralning is given to

the employees who have some years of experience to

understand the latest technological developments and new

inventions. The Pondicherry Cooperative Milk Producers'

Union Ltd. has trained 9 (69.23%) out of 13 employees while

The Pondicherry Cooperative Sugar Mills Ltd. has trained one

third of its total employees. The Indian Coffee Workersr

Cooperative Society Ltd. has not given any in-service

training to any of the 25 respondents. The refresher

training is poor in The Pondicherry State Cooperative Banks

Ltd. and The Pondicherry cooperative Wholesale Stores Ltd.

Out of 150 respondents, 40 (26.67%) have received refresher

training which may not be considered as satisfactory.

Table 5.2

Classification of Employees on the basis of In service Training

-

~ 1 . Name of the Whether undergone Total NO. Society Inservice Training

Yes NO

1. The Pondicherry 8 5 13 Coop.Milk Producers'(61.54) (38.46) ( 100) Union Ltd.

2. The Indian Coffee - 25 25 Workers1 Coop. (100.00) (100) Society Ltd.

3. The Pondicherry 21 42 63 Coop. Sugar Mills (33.33) (66.67) (100) Ltd.

4. The Pondicherry 7 2 5 3 2 State Coop. Bank (21.88) (78.12) (100) Ltd.

5. The Pondicherry 4 13 17 Coop. Wholesale (23.53) (76.47) (100) Stores Ltd.

Total 4 0 110 150 (26.67) (73.33), (100)

Source : Compiled from the Questionnaire 11.

N.B. : Figures within brackets indicates percentage.

These samples only indicate the scant importance they

have given to the employee's training by the Cooperative

societies in the Union Territory of Pondicherry.

TRANSFER

The internal procurement of job may be done either by

transfer or by promotion. In this section, transfer is

analysed. Transfer simply means change of job within the

organisation. It may be within the section or from one

section to another or one branch to another. Transfer does

not alter the status, salary or responsibility of employee.

In some cases there may be differences in perks such as risk

allowance, house rent allowance, etc. It is an horizontal

movement. It may or may not involve change of place of work.

Definition

Yoder and others consider transfer as "a lateral shift

causing movement of individuals from one position to another

usually without involving any marked chanqe in duties,

responsibilities, skills needed or compensationn8.

A transfer may be either organisation initiated or

employee initiated. An organisation initiates transfer to

make the best use of the employees for higher productivity

8 . Yoder D., Heneman H.G., Turnbull J.G. & Stone C.H - Handbook of Personnel Management and Industrial Relations - McGraw - Hill Book Company, New York - 1958 - p. 20.

or look after more Urgent duties of another for short

periods or to avoid monotony or to train the employee in

different sections of the organisation. An employee may also

be transferred as a punishment or to avoid inter-personal

conflicts. An employee initiated transfer may be due to his

desire to be nearer to his family, relatives and friends

or to a place where he could have better educational and

medical facilities to the members of his family or to work

under the supervisor whom he likes.

Transfers are mostly organisation initiated and the

employee may succeed in securing or avoiding a transfer so

long as the interest of the organisation is not affected.

A wrong transfer policy acts as a negative motivator and the

productivity of the organisation is affected. Above all the

interpersonal relation is also worst affected.

Managerial Practice

Among the five selected cooperatives, transfer is not

a big issue except in the case of The Pondicherry State

Cooperative Bank Ltd. which alone has the entire Union

Territory as its area of operation. In The Pondicherry

Cooperative Milk Producers' Union Ltd. the main office

and factory are situated at Aiyankuttipalayam, 10 K. M.

away from Pondicherry. Most of the employees are

working here. There is a small marketing section and Cattle

Fodder Development section in Pondicherry town. So, transfer

is not a serious problem. In The Indian Coffee Workers'

cooperative Society Ltd. though there are branches, the

employees are not transferred unless they desire. In The

Pondicherry Cooperative Sugar Mills Ltd. all the employees

are working in the same place viz., Lingareddipalayam, a

village 25 K.M. away from Pondicherry town. In The

Pondicherry Cooperative Wholesale Stores Ltd. all the

branches are situated in Pondicherry town and its suburbs.

So, transfer is not a serious issue.

The Union Territory of Pondicherry consists of four

regions geographically scattered. Pondicherry and Karaikal

regions are in Tamil Nadu on the east coast. Mahe region is

in the west coast, 7 K.M. south of Tellicherry, in Kerala.

Yanam region is situated 40 K.M south of Kakinada, in Andhra

Pradesh. Transfers within the region or transfer from

Pondicherry to Karaikal and vice versa is not seriously

objected to by employees of The Pondicherry State

Cooperative Bank Ltd. But transfer to Mahe and Yanam is

seriously resisted as it involves change of climate,

language, food habits and long distance from Pondicherry

to which most of the employees belong.

So, The Pondicherry State Cooperative Bank Ltd. had

evolved a transfer policy in the form of MOU with the

employees in respect of transfers to Mahe and Yanam

regions. Every employee will have to serve one of these two

regions for one year in each grade. The transfers will

be effected during the last week of May. It is strictly

followed and the employees have no grievance in this regard.

But with regard to transfer within Pondicherry and between

Pondicherry and Karaikal regions, the transfer policy has

not been finalised. It is believed that the same will be

done shortly. Hence, the transfer policy and practice of all

the selected cooperative societies are satisfactory.

Introduction

Employees of every organisation should be provided with

opportunities to obtain promotion since personal advancement

is undoubtedly one of the best inducements for people to

stay with an employer. Promotion is one of the internal

sources of recruitment. If an employee is transferred from

one post to another with an increase in responsibilities,

status and emoluments it is known as promotion. A promotion

reduces the cost of recruitment, rewards a good employee,

functions as one of the motivating factors of employees and

enhances their morale and productivity. A promotee has

already acquired the knowledge of the objectives of the

organisation and familiar with the work environment. It will

take little time and effort to prepare him for his new job.

Definition

Scott and others are of the opinion that "a promotion

is the transfer of an employee to a job which pays more

money or that en joys some preferred statusn.' According to

them promotion involves either increase in responsibilities

or emoluments but need not necessarily be both. But Pigors

and Myers feel that "if the job does not involve greater

skill and responsibility and higher pay, it should not be

considered as a promotion. A promotion without an increase

in pay but only in responsibilities, is known as a dry

promotionv. lo

Rudrabasavaraj, M. N. agrees with Pigors and Myers and

defines promotion as "an upward movement or advancement of

an employee in the organisation, to another job which

9. Scott, Walter Dill, Robert C. Clothier and William R. Spriegel - Personnel Management - Tata McGraw-Hill Publishing Company Ltd., New Delhi - 1986 - P.178

10. Paul Pigors and Charles Myers - Personnel Administration A Point of View and Method - McGraw-Hill International Book Company, New Delhi - 1981 - P.303

commands better pay or wages, better status or prestige,

higher challenges, responsibilities and opportunities".ll

For the purpose of the study, it is assumed that a promotion

means an upward advancement in rank, status, responsibility

and pay.

Criteria for Promotion

Promotions may be based purely on seniority or purely

on merit or on merit cum seniority. Promotions based on

purely on seniority is simple to be adopted, unbiased and

avoids disputes between employees and the organisation.

But it does not encourage hard work or acquiring additional

qualification. Even if the employee does only the minimum

work, he is sure to be promoted when his turn comes up.

Promotions based on merit is exactly contrary to

promotions based purely on seniority. The merits of

promotion on seniority are demerits of promotions on

merit and vice versa. The difficulty in this method is

determination of what constitutes merit and its measurement.

There are chances for favouritism and nepotism by the

and meritorious employees merely because they have no

11. Rudrabasavaraj M.N. - Personnel Administration Practices in India - Vaikunth Metha National Institute of Cooperative Management, Pune - 1969 - P.28

influence or opposed the management for their wrong

policies.

Promotions on the basis of merit cum seniority is ideal

in that it combines the merits of both the systems and

avoids their demerits provided the merit and seniority

are blended at optimum proportions and the merit is well

defined, publicised and decided without favouritism. In this

section the promotional policy of the societies are

critically analysed to find out their merits and demerits.

Uanagerial Practice

In all the selected cooperative societies, the

promotions are based purely on seniority. There is no

scope for direct recruitment to any higher post. All the

higher posts are filled in by promotion from within the

organisation. Though this is highly satisfactory to senior

employees, this policy is not encouraging to junior

employees with higher qualifications than the minimum

prescribed in the Recruitment Rules. But the management is

helpless in this regard as it is in accordance with the

agreement with the employees' unions.

COMPENSATION

The employees use their knowledge, skill, time and

energy for achieving the objectives of the organisation.

The reward for their contribution is known as compensation.

Compensation is aimed at obtaining and retaining a work

force. The term compensation refers to the whole of benefits

received by an employee on account of his employment. It may

be either direct or indirect. Wages and salaries of

employees and other allowances such as dearness allowance,

house rent allowance, risk allowance to cashiers, washing

allowance, etc., which are paid along with wage or salary

are the components of direct compensation. Bonus is also

treated as direct compensation as it is now treated as

delayed wages as against incentive for increased production.

Benefits like residential quarters, free medical,

educational and transport facilities, life, accident and

health insurance, subsidised canteen, employer's

contribution to Provident Fund, promise to pay gratuity and

pension at the time of retirement come under indirect

benefits.

Definition

Compensation is a part of a transaction between

employee and employer that results in an employment

contract. Edwin B. Flippo defines compensation as, "the

adequate and equitable remuneration of personnel for their

contribution to organisation objectives" . l2 The compensation should be adequate to attract best employees, motivate and

retain them in the organisation.

Problem of Fixing Equitable Compensation

Though fixation of compensation is most vital and

sensitive, it is sophisticated and a most difficult problem

of personnel administration. From the employees point of

view minimum standard of living, cost of living, the

knowledge, skill and experience required for the job, wages

paid in other organisations, the status and authority of

the employee in the same organisation should be considered.

The organisation will have to consider its capacity to

pay as compensation constitutes a major item of cost of

production. It should also consider the compensation paid

to other employees in the same organisation, in the same

rank as well as lower and higher ranks.

The problem is enormously complicated by such variable

factors as the supply of and demand for employees, the

firm's ability to pay, the bargaining capacity of labour

12. Edwin 8 . Flippo - Principles of Personnel Management - McGraw - Hill Book Company, New Delhi - 1971 - p.7

197

organisations, cost of living and Governmental Legislation.

Therefore, it is extremely difficult to evaluate the present

system of compensation.

The evaluation of adequacy of compensation in the

selected cooperative societies may either be done by

comparison among themselves or by comparison with the

private and public sectors. Since the selected sample units

are heterogeneous in character, the compensation cannot

be compared among themselves. It is also not possible to

compare the compensation of employees in the cooperative

sector with that of private and public sectors for the same

reasons.

The principles of cooperation and exploitation of any

kind are contradictory to each other. It is expected that

cooperatives will pay better compensation to their employees

when compared to other organisation as cooperatives are

expected to be model employers. So, the present study deals

with the policy of the selected cooperative societies in

fixing the compensation and whether it is fair and adequate

when compared to other organisations.

In the case of office employees in the selected sample

units, the compensation is on a par with that of Government

servants except in the case of bonus. The rate of bonus is

higher in cooperatives and there ifi no ceiling. In the case

of technical staff, each unit is following its own norms.

The Pondicherry Cooperative Milk Producers' Union Ltd.

follows the norms given by the Dairy Development Corporation

which is mainly based on ANAND pattern. In the case of

Coffee House, the pay structure is determined by themselves,

since it is an industrial society. In the case of The

Pondicherry Cooperative Sugar Mills Ltd. the technical

employees are paid on the basis of norms fixed by Sugar Wage

Board,constituted by the Directorate of Sugar in Tamil Nadu.

The norms for compensation of State Cooperative Bank Ltd. is

decided by NABARD. In the case of Pondicherry Cooperative

Wholesale Stores Ltd. the norms are decided by NAFED.

Therefore the researcher followed a different technique

to find out the adequacy of the compensation of the

employees by asking opinion of the employees themselves. In

Questionnaire 11, three questions were asked to compare

their pay and allowances with the pay and allowances of

other Cooperative Societies, Government and Private Sector.

Their replies are given in Tables 5.3, 5.4 and 5.5.

out of 150 respondents, 103 (68.67%) feel that the

Compensation is equal to or more than the compensation of

their counterparts in the private sector. It is a favourable

trend.

Table 5.3

statement of Comparison of Compensation of the Employees in the Selected Units with the Private Sector

S1. Name of the Higher Equal Lower Total No. Society

1. The Pondicherry 7 4 2 13 Coop. Milk ProducersJ(53.88) (30.77) (15.38) (100) Union Ltd.

2. The Indian Coffee 4 14 7 25 Workers' Coop. (16.00) (56.00) (28.00) (100) Society Ltd.

3. The Pondicherry 20 2 0 2 3 63 Coop. Sugar Mills (31.75) (31.75) (36.50) (100) Ltd.

4. The Pondicherry 18 9 5 32 State Coop. Bank (56.25) (28.13) (15.62) (100) Ltd.

5. The Pondicherry 3 4 10 17 Coop. Wholesale (17.65) (23.53) (58.82) (100) Stores Ltd.

Total 5 2 51 47 150 (34.67) (34.00) (31.33) (100)

Source : Compiled from the Questionnaire 11.

N.B. : Figures within brackets indicate percentage.

Table 5.3 gives the comparison of compensation

between the employees of the selected units and in the

Private Sector.

Table 5 . 4

Statement of Comparison of Compensation of the Employees in the Selected Units with the Public Sector

-

S1. Name of the Higher Equal Lower Total No. Society

1. The Pondicherry 2 6 5 13 Coop.Milk Producers1(15.38) (46.16) (38.46) (100) Union Ltd.

2. The Indian Coffee 2 16 7 25 Workers' Coop. ( 8.00) (64.00) (28.00) (100) Society Ltd.

3. The Pondicherry 8 18 37 63 Coop. Sugar Mills (12.70) (28.57) (58.73) (100) Ltd.

4. The Pondicherry 2 0 8 4 3 2 State Coop. Bank (62.50) (25.00) (12.50) (100) Ltd.

5. The Pondicherry - - 17 17 Coop. Wholesale (100.00) (100) Stores Ltd.

Total 3 2 4 8 7 0 150 (21.33) (32.00) (46.67) (100)

Source : Compiled from the Questionnaire 11.

N.B. : Figures within brackets indicate percentage.

As per the above Table, 80 (53.33%) out of 150

employees feel that their compensation is equal to or better

than their counterparts in Government service. This is also

a healthy trend.

In Table 5.5, the compensation of the employees in the

selected cooperative societies is compared with that of

their counterparts in other cooperative societies. Out of

150 employees 117 (78%) feel that their pay is equal to or

more than their counterparts in other cooperatives. All the

Table 5 . 5

Statement of Comparison of Compensation of the Employees in the Selected Units with the other Cooperatives

S1. Name of the Higher Equal Lower Total NO. Society

1. The Pondicherry 1 8 4 13 Coop.Milk Producers' (7.69) (61.54) (30.77) (100) Union Ltd.

2. The Indian Coffee - 17 8 25 Workers1 Coop. (68.00) (32.00) (100) Society Ltd.

3. The Pondicherry 2 0 29 14 6 3 Coop. Sugar Mills (31.75) (46.03) (22.22) (100) Ltd.

4. The Pondicherry 2 0 12 - 3 2 State Coop. Bank (62.50) (37.50) ( 100 Ltd.

5. The Pondicherry - 10 7 17 Coop. Wholesale (58.82) (41.18) (100) Stores Ltd.

Total

Source : Compiled from the Questionnaire 11.

N.B. : Figures within brackets indicate percentage.

selected units are bigger in size with higher capacity

to pay. This is also a healthy trend.

The pay scale of the Managing Director of The

pondicherry Cooperative Milk Producers' Union Ltd. is

Rs. 4500 - 5700 plus all allowances on a par with Government Officials. The pay scale of Secretary to Government of

Pondicherry is Rs. 3700 - 5300. Further the Managing

Director is also eligible for bonus and exgratia payment

without any ceiling. But Government servants are not

eligible for bonus if their salary including allowances

exceeds Rs. 2500 per month. This ceiling has been removed

for the Group C and D staff from this year.

The total salary of the Assistant General Manager in

The Pondicherry State Cooperative Bank Ltd. is more than

that of the General Manager who is a deputationist from the

Cooperative Department in the rank of Deputy Registrar. It

is also observed that many of the middle level Managers are

income tax assesses. This really proves that the Cooperative

Sector is acting as a model employer with regard to payment

Of compensation irrespective of their ability to pay.

EMPLOYEES' UNION MANAGEUENT RELATIONS

A trade union may consist of employees belonging to the

same category such as Pondicherry Cooperative Sugar Mills

Ltd. Field Staff Welfare Association. A trade union may also

be formed for the benefit of all the employees of the same

organisation like Pondicherry Cooperative ilk Producers'

welfare Association. An organisation may have a single union

or multiple unions. Again the union office bearers may be

workers of the organisation or outsiders. Some unions may

have political linking while others may not. Each

system is having its merits and demerits. It is better to

have one union for each organisation with its leaders

from the employees of the organisation without any political

affinity.

Harmonious employee-employer relationship is essential

for the effective functioning of any organisation.

Cooperatives are not exceptions. Mutual respect and

Understanding qo a long way in promoting the objectives of

an organisation. But the interests of employees and employer

differ. Employees desire to have maximum compensation and

best working conditions to improve their standard of living.

on the other hand, the employer wants to pay compensation as

low as possible to reduce cost and increase profit.

peculiar Position of Cooperatives as Employer

This kind of conflict of interests should not exist in

cooperatives. The principles of cooperation and exploitation

are contradictory to each other. Both the cooperatives and

trade unions stand for saving the working class from

exploitation, at least theoretically. The first cooperative

society was started by the Rochdale pioneers to protect the

poor working class people against the rich capitalists.

The definition of cooperation itself says that it is for the

promotion of interest of all, whether a member or not. In

industrial cooperatives, like The Indian Coffee Workers1

Cooperative Society Ltd. Pondicherry, the members are

employees. In other words, the employees and the management

are one and the same. Goel and Goel had correctly observed

that "employer-employee relationship in cooperatives is

distinct from the private sector as the latter is interested

in the maximisation of profits, while the former is

interested to serve its members".14

14. Goel S.L. and Goel B.B. - Administration of Personnel in Cooperatives - sterling Publishers Private Ltd., New Delhi - 1979 - P. 105.

m f inition

Dale Yoder has defined, A trade union is a continuous

association of workers which is formed with the purpose of

protecting the interest of workersw15 In the opinion of

Edwin B. Flippo a labour union is, "an organisation of

workers formed to promote, protect and improve, through

collective action, the social, economic and political

interests of membersw. l6

The relation between employees' union and management is

analysed in this section, in terms of the number of unions

for each society and their political affiliation. The method

and number of agitations made during the last five years and

the reasons for the same are analysed. The number of man

hours lost due to agitation.

In The Pondicherry Cooperative Milk Producers' Union

Ltd. there are two employees' unions. Both have political

affiliations. One is affiliated to CITUC (CPM) and the

other to AITUC (CPI). In both cases leaders are from

Outside the organisation. During the last five years there

15. Dale Yoder - Personnel Management and Industrial Relations - Printice-Hall of India, New Delhi - 1972 - p. 159.

16. Edwin B. Flippo - Personnel Management - McGraw - Hill Book Company, New Delhi - 1984 - p. 425

was no dispute between the unions and the management. This

is mainly due to fair compensation and adequate bonus paid

by the Milk Producers' Union.

In The Indian Coffee Workers' Cooperative Society Ltd.

there are two unions. One is affiliated to AITUC and the

other to INTUC. In both cases, leaders of the union are

employees of the society. During the last five years ending

March, 1994, there had been no dispute at all. The main

reason is that management and employees are the same in the

society. Though, the society has not paid any dividend on

share capital, it is paying fair wages, and bonus over and

above the rate recommended by the Registrar of Cooperative

Societies. They are also doing many labour welfare measures.

But recently, the casual workers belonging to INTUC are

agitating for regularisation. This is not considered for two

reasons, namely, first they are not regular workers and

secondly,the agitation took place after the period of study.

In The Pondicherry Cooperative sugar Mills Ltd. there

are as many as 11 unions. Among them, six unions are

having political affiliations having the leaders from

outside. The other five unions are based on their jobs and

are having the employees as their leaders. In this mill

also, there has been no agitation during the period of

study due to fair compensation and higher bonus.

In The Pondicherry State Cooperative Bank Ltd. there

is only one union and all the employees are its members. The

leadership of the union is within the organisation. The

union is not having any political affiliation. These

characters of the union is due to higher education of

employees and their greater perception of the objectives of

the union. This is highly satisfactory.

In The Pondicherry Cooperative Wholesale Stores Ltd.

there are 3 unions and all of them are politically

affiliated. The leaders of the union are from outside.

During the period of the study, there was dispute only once

for revision of salary. There was no actual strike but

strike notice was issued. Before the actual date of strike,

the dispute was solved through mutual discussion.

It is heartening to note that during the period of

study, harmonious relationship existed in all the selected

five cooperative societies. Before actually analysing the

reasons for this highly favourable situation, it is better

to examine the similar studies made earlier.

The National Cooperative Union of India conducted a

survey of 45 trade unions in cooperative sector in 1977.

The survey revealed that out of 45 trade unions, 15 had

adopted militant measures like strikes, hunger strikes,

gheroes, etc., to force the management of concerned

cooperative institutions to press their demands. There were

26 strikes in 15 unions during a period of 3 years.17

Jyothi S.S. conducted a research in the early

eighties in Human Resource Management in cooperative

sector and concluded that unionism is still generally

weak in cooperative sector. The union-management relations

were generally cordial not necessarily because the employees

were satisfied and their morale was high, but essentially

because their bargaining power was limited.18

Sivaprakasam. P conducted a research in Personnel

Management in Central Cooperative Banks in lndialg. During

the period of five years from 1983 - 84 to 1997 -88 many strikes took place and as a result of these agitations,

17. National Cooperative Union of India - Employer-Employee Relationship in Cooperative Sector - Report of the National Workshop, New Delhi - 1977 - p.4

18. Jyothi S.S. - Human Resources Management in Cooperative Sector - Inter India Publication - New Delhi - 1986 - p. 282

19. Sivaprakasam P. - Personnel Management in Central Cooperative Banks in India - Kanishka Publishers, New Delhi - 1993 - p. 169.

about 2000 mandays were lost to the Banks. These

agitations were settled by means of bi-parte and tri-parte

negotiations with the interventions of labour officer and/

or Registrar Of Cooperative Societies.

When compared with the above three studies, the

employees' union management relation is very cordial not

due to lack of bargaining power but because of the

efforts of Management, Registrar of Cooperative Societies

and Government. Pondicherry being a small Union Territory,

the Hon'ble Minister for Cooperation himself usually

interferes, grants satisfactory awards to the employees and

thus avoids any industrial agitation in the cooperative

sector. This is a highly favourable point in personnel

management practice in cooperative sector of this Territory.