Industrial Relations and Labour Laws – concept, objectives and Modern Apporach

In this post, we will learn about the Concept of Industrial Relations, the Objectives of Industrial relations and labour laws, the Importance of Industrial relations, the Definition of Industrial relations and the Modern Approach to Industrial Relations.

Concept of Industrial Relations

After the birth of the Industrial Revolution in 1800 BC, every nation in the world recognised the value and Importance of Industries. They realised, without industrial development, they can not become an economically stable country. These Industrial setups were also important for a Nation to make them self-reliant & self-sufficient. This is the reason behind the rapid industrialisation development throughout the world.

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An Industry has two main components: Management and Labour.

Management – It includes the Owner and the Capitalist of Industries. Their roles are to invest money & other inputs like machinery, Land, etc. The main objective of management is to acquire maximum profit.

Labour – It includes the workers, contract workers, employees and migrant Labour. They toil hard for the maximum production of Goods and Services in any Industry and They provide their services in return for Better Wages and Lifestyles.

During the phase of rapid Industrialisation, Industries work with three main policies for the solo benefits of management class. These three policies were – 1. Laissez Faire 2. Hire & Fire and 3. Demand & Supply.

  1. Laissez-Faire Policy – Laissez-Faireis a French term that translates to “leave alone” and literally, means, “let you do”. Laissez-faire is an economic theory from the 18th century that opposed any government intervention in business affairs. The driving principle behind laissez-faire is that the less the government is involved in the economy, the better off business will be, and by extension, society as a whole.
  2. Hire & Fire Policy – Under this policy, a firm can lay off workers whenever they deem so or whenever the market conditions are bad.
  3. Demand & Supply – There was only a supply of labour if the firm has a demand for labour.
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However, this resulted in low wages, non-hygienic habitats, lack of security & poor condition for migrant labours. This led to a conflict between management & workers. consequently, the Profit of the employer, Employment of the employee and the development of the Nation is hampered.

Finally, at a global level, a few things have been accepted:

  • None of the nations can have sustainable development without the interest of workers.
  • Workers are human and they must be treated humanely.
  • Labour is actually a human resource and we must have to utilize it wisely.
  • There must be a harmonious relationship between management and employee for consistent economic growth.
  • And thus, a peaceful relationship was established between the management and workers for the overall growth of a nation called “Industrial Relations”.
  • However, their contradictory nature is the reason for the enforcement of some government laws that make this relation harmonious and these laws are known as Labour Laws.

The concept of industrial relations is characterised as collectivist and pluralist in nature. The Collective Aspect of the Industrial Relationship is team working & employee participation in decision-making. The pluralistic approach assumes that the organization is composed of individuals who form distinct groups with their own set of aims, objectives, leadership styles and value propositions.

Modern Approach to Industrial Relations –

The modern approach to industrial relations includes –

  • Relationships between worker & worker.
  • Relationships between workers and employers
  • Relationships between employers and employers
  • Various processes are involved in these relationships such as the organising of workers, workers’ participation in decision-making, dispute settlement, collective bargaining etc.
  • It also focuses on the improvement of the economic conditions of workers.

Definitions of Industrial Relations as per Different Scholars

Industrial relations is the relationship between management and employees, or among employees and their organisations, that characterise or grow out of employment.


Industrial Relations as a study of the institutions of job regulation.


The study of processes of control over work relations. Consider, “struggle for power” as an inherent feature of industrial relations.


The Industrial Relations is the relation between an employer and employee in the course of running of an industry and may project itself to spheres which may transgress to the areas of quality control, marketing, price fixation, and disposition of profits among others.


Industrial relations cannot be separated from the institutional framework, which is mainly made up of government agencies responsible for creating policies and rules governing industry and labour. The Involvement of government agencies gives rise to the tripartite nature of Industrial relations with labour, management and the state as the three actors. The state intervention is to achieve cooperation and social justice (e.g., prevention of exploitation of sweated and child labour). The State also acts as a regulatory body for industrial relations in India.

Definition of Industrial Relations

Industrial relations as a means by which the various interests involved in the labour market are accommodated, primarily for the purpose of regulating employment relationships.

Objectives of Industrial Relations & Labour Laws

Objectives of Industrial Relations

  • Enhance the economic status of the workers
  • Regulate production by minimizing industrial conflicts
  • Socialize Industries
  • Provide Opportunities for the workers
  • Improve workers strength
  • Avoid Industrial conflicts
  • Maintain Industrial Democracy

Objectives of Labour Laws

  • Improve Industrial Relation
  • Minimise the Industrial Disputes
  • Protect workers from exploitation
  • Help workers in getting fair wages
  • Minimise labour unrest & reduce conflicts and strike
  • Ensure job security for workers


As per the modern approach to Industrial Relations, Industrial Relations is a relation between what parties?

As per the modern approach to Industrial relations, Industrial Relations is a relation between,
– Relationships between worker & worker.
– Relationships between workers and employers
– Relationships between employers and employers

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