What is Trade Union? Definition, Functions, Objectives, Purpose

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What is Trade Union?

The trade union is an association, either of employees or employers or of independent workers. It is a relatively permanent combination of workers and is not temporary or casual.

It is an association of workers engaged in securing economic benefits for its member’s Trade union formed in accordance with the law of their country shall have the privileges given by the law of trade union.

With privileges or rights of the trade union, it should perform certain duties with respect to workers. The Primary purpose of a trade union is collective bargaining. In India trade unions can be formed only the persons engaged in trade or business can form trade unions.

Trade unions or labour unions are governed by the different law in different countries; they should follow the procedure and mode of registration for formation of the trade union according to the law of the country.

Trade Union Definition

Trade Union is a monopolistic combination of wage earners who stand to the employers in a relation of dependence for the sale of their labour and even for the production, and that the general purpose of the association in view of that dependence is to strengthen their power to bargain with the employers.Cunnison
a trade union is a monopolistic combination of wage earners who as individual producers are complementary to one another but who stand to employers in a relation of dependence for the sale of their labour and production and that the general purpose of association is in view of that dependence to strengthen their power to bargain with the employers or bargaining collectively.”S.D Punekar
voluntary organizations of workers formed to promote and protect their interest by collective action.Sri V.V.Giri
trade unions are generally understood as voluntary organizations of workers formed for the purpose of defending and advancing the latter’s collective interest either mutually or in relation to outside parties’ such as employers, Government and other trade unions.C.K. Johri

Statutory Definition of ‘Trade Union’ in Indian Context

The term ‘trade union’ has been defined under Section 2(h) in the Trade Unions Act, 1926. Accordingly ‘trade union’ means any combination, whether temporary or permanent, formed primarily for purpose of regulating the relations between workmen and employers or between workmen and workmen or between employers and employers or for imposing restrictive conditions on the conduct of any trade or business and include any federation of two or more trade unions.

Provided that this Act does not affect:

  • Any agreement between partners as to their own business.

  • Any agreement between an employer and those employed by him as to such employment.

  • Any agreement in consideration of the sale of the goodwill of a business or of instruction in any profession, trade or handicraft.

  • This definition is similar to that of the definition of the trade union as defined under the Trade Unions Act, 1871 in England.

The paramount purpose of the combination is to regulate the relations between the employer and workmen and to impose the restrictive conditions on the conduct of trade or business of some other person.

This definition is having a specific relevance to the immunities provided under sections 17, 18 and 19 of the Trade Unions Act, 1926.

Characteristics of Trade Union

  • Association of employees: A trade union is essentially an association of employees belonging to a particular class of employment, profession, trade or industry. For example, there are unions for teachers, doctors, film, artistes, weavers, mine workers and so on.

  • Voluntary Association: An employee joins the trade union out of his free will. A person cannot be compelled to join a union.

  • Permanent Body: A trade union is usually a permanent body. Members may come and go but the trade union remains.

  • Common Interest: The member of a trade union have certain matters of common interest-job security, better pay and working conditions and so on, which bring them together.

  • Collective Action: Even when an individual employee has any grievance over certain management decisions, the matter is sorted out by the intervention of the trade union Employees are able to initiate collective action to solve any problem concerning any particular employee or all the employees.

  • Rapport with the Management: The trade union seeks to improve relations between the employees and employers. The officials of the trade union hold talks with the members of the management concerning the problems of the employees in order to find an amicable solution. It is thus possible for the employees to have better rapport with the management.

Objectives of Trade Union

The major objectives of trade union are the following:

  1. Better wages & working conditions and promotion of Industrial peace
  2. Protection against Exploitation and Victimization.
  3. Representation (Workers’ Interests)
  4. Negotiation (Collective Bargaining)
  5. Voice in decisions (Lay off, Retrenchment) affecting workers
  6. Member Service (Education, Training, Welfare, Discounts, Loans)

Functions of Trade Union

Militant Function

One set of activities performed by trade unions leads to the betterment of the position of their members in relation to their employment. The aim of such activities is to ensure adequate wages secure better conditions of work and employment get better treatment from employers, etc.

When the unions fail to accomplish these aims by the method of Collective bargaining and negotiations, they adopt an approach and put up a fight with the management in the form of go-slow tactics, strike, boycott, gherao, etc.

Hence, these functions of the trade unions are known as militant or fighting functions. Thus, the militant functions of trade unions can be summed up as:

• To achieve higher wages and better working conditions
• To raise the status of workers as a part of industry
• To protect labors against victimization and injustice

Fraternal Functions

Another set of activities performed by trade unions aims at rendering help to its members in times of need, and improving their efficiency. Trade unions try to foster a spirit of cooperation and promote friendly industrial relations and diffuse education and culture among their members. They take up welfare measures for improving the morale of workers and generate self confidence among them.

They also arrange for legal assistance to its members, if necessary. Besides, these, they undertake many welfare measures for their members, e.g., school for the education of children, library, reading-rooms, indoor and out-door games, and other recreational facilities. Some trade unions even undertake publication of some magazine or journal.

These activities, which may be called fraternal functions, depend on the availability of funds, which the unions raise by subscription from members and donations from outsiders, and also on their competent and enlightened leadership.

Thus, the fraternal functions of trade unions can be summed up as:

• To take up welfare measures for improving the morale of workers
• To generate self confidence among workers
• To encourage sincerity and discipline among workers
• To provide opportunities for promotion and growth
• To protect women workers against discrimination

Specific Functions of Unions

  • Wage & salary bargaining
  • Fight for continuous improvement in employee benefits
  • Improving working conditions at the workplace
  • Improving welfare, healthcare & recreation facilities, and leisure at workplace
  • Increasing rest periods, holidays, paid leave and time-offs
  • Decreasing working hours, workload mainly manual, and hazardous working conditions
  • Improving career and salary rise prospects & job security
  • Protecting employees against arbitrary/unjust actions of Management

Importance of Trade Union

  • For industrial peace
  • Decisions taken through the process of collective bargaining and negotiations between employer and unions are more influential
  • Effective communication between the workers and the management
  • Economic development
  • Recruitment & selection
  • Discipline among workforce
  • Settlement of Industrial Disputes in a rational manner

Purpose of Trade Union

  • Employment Protection and Job Creation.
  • Economic Protection.
  • Social Status – Identity.
  • Political Role – Democratic Institution
  • Societal Obligation – Transformation.
  • Competitiveness / Sustainable Development.
  • Formed to protect and promote the interests of their members
  • Primary function is to protect the interests of workers against discrimination and unfair labour practices

Why do People Join Union?

  • Greater Bargaining Power
  • Minimize Discrimination
  • Sense of Security
  • Sense of Participation
  • Sense of Belongingness
  • Platform for self expression
  • Betterment of relationships

Problems of Trade Union

Small size of the unions

  • The small size of the unions is due to various factors, namely, i. The fact that any seven workers may form a union under the Trade Unions Act of 1926, and get it registered, a large number of small unions have grown.

  • The structure of the trade union organization in the country is in most cases the factory or the unit of employment. So whenever employees in a particular factory or mine are organized, a new union is formed.

  • Unionization in India started with the big employers and gradually spread to smaller employers. This process is still continuing and pulled down the average membership. Though the number of unions and union membership are increasing, average membership is declining.

  • Rivalry among the leaders and the central organizations has resulted in multiplicity of unions, thereby reducing the average membership.

Inadequate funds

Because of the small size of the unions, they suffer from lack of adequate funds and they find it difficult to engage the services of experts to aid and to advise members in times of need. Further, they cannot face the challenge of employers for long because of their weak bargaining power.

The trade unions suffer from financial weakness for the average yearly income of the unions has been rather low and inadequate. Under conditions of multiplicity of unions, a union interested in increasing its membership figures, usually keeps the subscription rate unduly low and does not collect even that subscription regularly.

Insufficiency of funds is the main reason for the deplorable conditions of many a small union. The poor financial position adversely affects their entire working. They

Multiplicity of the Unions & Intra-Union Rivalry

Multiple rival unionisms are an important feature and one of the great weaknesses of the Indian trade union movement. Multiple unions are mainly the result of political outsiders wanting to establish unions of their own, with a view to increasing their political influence, albeit in urban areas.

The existence of different conflicting or rival organizations, with divergent political views, is greatly responsible for inadequate and unhealthy growth of the movement.

A multiplicity of unions lead to inter-union rivalries, which ultimately cuts at the very root of unionism, weakens the power of collective 43 bargaining and reduces the effectiveness of workers in securing their legitimate rights.

Intra-Union rivalry

Another vexing problem is that of intra-union rivalry. Trade union rivalry is acute and pervades the entire industrial scene in India. In practically every important industry or industrial centre, there exists a parallel and competing union.

Leadership Issue

Another disquieting feature of the trade unions is the ‘outside’ leadership, i.e., leadership of trade unions by persons who are professional politicians and lawyers and who have no history of work in the industry. This is ‘leadership by intellectuals’ rather than ‘by workers’.

It applies at the local as well as at the national level. There are several reasons for this phenomenon namely, for avoiding victimization of worker-office-bearers of the trade unions, and at times for lack of financial resources to appoint whole time office-bearers.

Politicalisation of the Unions

One of the biggest problems the country’s trade union movement faces is the influence of the political parties, i.e. the most distressing feature is its political character.

Harold Crouch has observed, even to the most casual observer of the Indian trade union scene, it must be clear that much of the behavior of Indian unions, whether it is militant or passive behavior, can be explained in political terms.

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