National Commission on Labour (1967)||
21.1 The origin, growth and development of employers' organisations have three distinct phases: (i) the period prior to 1930; (ii) the period between 1931 to 1946; and (iii) the post-Independence period. Each phase reveals its own structural and functional characteristics; in each the organisations had to undergo changes because of contemporary economic, social and political developments. These changes have been more rapid in some than in others. The periods referred to also coincided with important developments in the labour field, and these have had a great impact on the pattern and development of employers' organisation as also on their functioning.
21.2 Pre-1930 Period.—This period was characterised mainly by the formation of associations of merchants in the form of chambers of commerce. During the latter half of the last century, industrial associations also came into being with the aim of protecting the commercial interest of their members and securing concessions from the Government. Regional associations at important centres of industrial activity developed, but again with a different focus for action. The Bombay Mill-owners' Association, the Bengal Millowners' Association, the Ahmedabad Millowners' Association are instances in point. Because of the need for industrial development and promotion of indigenous entrepreneurship, society was kind to and proud of persons who were instrumental in setting up industrial establishments generally, and Indian employers particularly. Not until the First World War did the organisations consider it important to deal with labour problems; there used to be stray references about undue militancy shown by labour, but these also were rare. By and large, the attitude of the employers towards labour was one of indifference and, at times, of aggression. The task which the organisations set for themselves was to defend their traditional rights through legislative lobbies and social contacts. Individual members had autonomy in working their units and in dealing with labour as they liked. Notable exceptions were the Indian Jute Mills' Association (IJMA) and the Bombay Millowners' Association which, because of conditions created by the First World War, regulated the working hours of member mills and introduced a system of payment of standard remuneration to workers. The Ahmedabad Millowners followed, but somewhat later. Shortage of skills in those days made individual employers attract workers by better payment. The workers gained in the process, but this did not last long since the employers soon realised the disadvantage of such individual arrangements. In plantations and mines, for instance, the employers were cautious in not allowing 'poaching'.
21.3 It was during this period that unions started gaining ground. Simultaneously, the movement for the liberation of the country also gathered momentum. The Indian National Congress was trying to synthesise the interests of workers and employers by bringing them politically under one fold. The limited
success achieved by it in the process was confined to some industrial centres, because a fair section of employers was outside the pale of such political influence. The combined effect of factors like the setting up of the ILO, the enactment of the Trade Unions Act, 1926, and the Trade Disputes Act, 1929, was the realisation on the part of individual employers of the need for greater coordination of their collective interests.
21.4 Period 1931—46.—Organising chambers of commerce and industrial associations for dealing with a variety of problems connected with industry was the rule prior to 1930. Some of these chambers dealt with labour matters too.1 The All-India Organisation of Industrial Employers (AIOIE)2 and the Employers' Federation of India (EFI) came into existence in 1933 to comprehend and deal with problems of industrial labour in a concerted manner. The All-India Manufacturers' Organisation (AIMO) followed in 1941. The set ting up of these organisations was again, as in the case of workers' unions, in response to the need then felt for representation on international conferences and legislative bodies. For a long time since 1920, the Government of India used to nominate delegates/members to represent employers' interests at such forums from amongst members of chambers of commerce but the employers soon realised that the chambers of commerce could not effectively look after their interests in labour matters. Each of the three organisations referred to above had a different sponsorship. The AIOE consisted mainly of indigenous entrepreneurs and had links with the Federation of Indian Chambers of Commerce and Industry. The EFI of those days had predominant membership of British industrial interests. The AIMO was sponsored by comparatively small sized establishments to look after their interests. The Government of India Act, 1935 made provision for representation of employers and labour in legislative bodies through special constituencies. The constituents of the AIOE and EFI thus got an opportunity to be represented in the Central and Provincial Legislatures. Labour legislation in the thirties in some Provinces made it necessary for local employers' organisations to expand their services to members in the labour field. The creation of the Labour Department in the Central Government and the constitution of tripartite bodies like the Indian Labour Conference and the Standing Labour Committee during the years of the Second World War helped develop further these activities within the local associations and federations.
21.5 Post-Independence period.—The period since Independence witnessed the growth of planning, expansion of industrial activity, extension of the democratic apparatus, passing of several labour laws and a growing trade union movement, all of which acted as a spur for the strengthening and expansion of employers' organisations. Experience of working together convinced employers of the advantage of unit- ed action. Employers' organisations grew in strength mainly to meet the requirements of individual employers for advice on labour matters. In some cases, they built up their strength' to match that of organised labour; in others, it was the other way round. At present, employers' organisations are organised at three levels:
(a) employers operating through their local organisations or otherwise; (b) industrial associations which cut across State boundaries; and (c) federations which comprise representatives both of industries and centres. Of the three, the local organisations which operate mainly through the chambers of commerce cover all industries in an area; their activities in the labour field are comparatively less extensive. It is the arrangements in the latter two which require a more detailed discussion.