Strategic Business Management Includes Revenue
Assistant Engineer, Indian Telephone Industries,
Consultancy_hr & Ir
+2 Others

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Presently i am facing a problem related with forming a new union. Till now there was no union. Now Workers in my company wants to form a new union. There are around 140 workers in my company. Can anybody tells me what is the process to form a new union ? What are the problems that management have to face in future? What documentations are required to form a new union ? and what is the legal procedure of it?
Rahul Dhokte

Dear Mr. Rahul Dhokte
1) What kind of problems you are facing "related with forming a new union"?
2) Why are you worried if your employees are forming an UNION?
3) What is your ROLE in your ORGANISATION?
4) Is it you who wants to form an UNION or your EMPLOYEES? Since you had requested for UNION FORMATION PROCESS and associated DOCUMENTS.
5) Do you want to get yourself educated about the PROBLEMS THAT MANAGEMENT MAY FACE due to UNION?
Looking forward to hear from you at the earliest.
With profound regards


Constitution of India has sanctified a "right to associate".
As a country we have encouraged formation of union and have put some legal restrictions on the process. Kindly note the following:
  1. Any seven people can get together and form a UNION.
  2. A Union is mere association of people till it is registered under Trade Unions Act 1927 whereafter it becomes a legal entity.
  3. Naturally it now legally obliged to function within the parameters set out by this and other applicable laws.
  4. A Trade Union is "representative body" of the workmen in the organization. It therefore simplifies dealing collectively with all workmen.
  5. A Trade Union concerns itself with "protecting and furthering" interests of the members and achieves this through a process of collective bargaining.
  6. But it is possible there are more than one unions in an organization and the question arises as to who to deal with! On a simpler level the unions that has the majority will be body to deal with. Of course issues settled with such a body will bind only its members and not others unless the matters of handled under a different provision of Industrial Disputes Act 1947.
The subject is too vast to be handled here.

At the generality level, professionally industrial democracy also justifies formation of trade unions. The concept had received resistence owing to feudal orientations of the employers. This was further justified by the unions themselves by behaving in an anti industrial interests.

But the times have changed. If we change our orientation we can build relations with our employees through a Union quite constructively.

The procedural part of Union formation is covered well in the Trade Unions Act itself.

Over time we have to develop skills in dealing with and through collective bargaining approach and it can be done! With changes in times, technology, competition and value systems, economism dictating routine life, Trade Unions are no longer a monster that it was considered to be in past.

Unions are a reality that grows on opposition. It simply cannot be wished away! It is better to acept the reality and develop skills to manage collective, representative relationships for gains!

If you need to ask more questions, please feel free!

May 30, 2011

As per the Trade Union (Amendment) Act 2001, 10% of the workmen strength is required to form an Union subject to a minimum of 7 and maximum of 100. i.e the minimum members required to form a Trade Union may vary from 7 to 100.
Accordingly if the strength of workmen is 140, the minimum members required to form a Trade Union is 14.

Dear Sir,
My Position in the organisation is "HR - Executive" and workers of my organisation has formed an union recently. I got a letter from this union regarding formation. Now I want to know that management should get any agreement with this new union ? If yes, then what type of agreement ? Also please informed me about minimum wages current rates for skilled/semi-skilled & unskilled labours. What is maximum & minimum percentage of bonus ?

Dear Mr. Rahul,
1) Employees who are part of newly formed UNION had intimated you about their FORMATION. Kindly don't get panic.
2) Unless UNION HEAD submits their AGENDA or DEMANDS, kindly don't discuss anything with UNION EMPLOYEES.
3) Minimum Wages booklet is available. You can approach either CA or LAWYER or LABOR COMMISSIONER or BOOKSTALL selling such books, for further help.
4) Whatever BONUS has to be paid, can only be decided by TOP MANAGEMENT or BOARD OF DIRECTORS as per company policies. Try not involve in such issues as you are not the decision maker.
Kindly note that, UNION HEAD will never communicate with HR DEPARTMENT as they prefer to deal with TOP MANAGEMENT, directly.
With profound regards

I think you should go through the bare Acts first .All of your qurys will be solved through that only
Go through
Industrial Dispute Act ,1947 and Trade union act ,1926
Payment of Bonus Act,1965
Minimum wages act ,1948

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