Industrial democracy is also known as worker’s control. Industrial democracy involves the rights of employees to participate in significant management decisions. This participation by labor includes areas such as wage rates, bonuses, profit-sharing, vacations and holiday leaves, work rules, dismissals, and plant expansions and closings. It takes the form of workers participation such as collective bargaining in which trade unions operate as a kind of permanent opposition to management. In this model management are seen to propose, employees and their unions offer reactions and if necessary oppositions and negotiation subsequently leads to collective agreements more or less satisfactory to both sides.
Industrial Democracy can be defined as an arrangement which involves workers making decisions, sharing responsibility and authority in the workplace.
Objectives of Industrial Democracy
- Co-operation and Higher Productivity: Collective discipline co-operations and higher productivity are the objectives of industrial democracy. To perform its real function of serving the community most efficiently; industry must adopt the democratic methods in its relations with the workers.
- Provides Opportunity: Democratic methods in the industry provide an opportunity for the causes of There can be no trust and no confidence between management and workers where there is not an open policy and a real partnership in industry.
- Create a Democratic atmosphere: under the democratic atmosphere, there will be group discipline, group responsibility and higher output, much more than under authoritarianism. Democratic participation by all ranks in the industry is not obviously an easy objective to achieve.
- To Get the Best out of a Worker: To get the best out of a worker, the treatment meted out to him should be such that it appeals to the best in him. To look after the well-being of the individual worker is the responsibility of the employer. Total well-being includes wages, working conditions and employee services. A happy worker is an asset to the employer. This can be achieved by making the workers active participants in the administration of the affairs of the organization to which they belong.
Benefits of Industrial Democracy
- Less industrial disputes resulting from better communication between management and staff.
- Improved decision-making process resulting in higher quality decisions.
- Increased creativity, enthusiasm and commitment to corporate objectives.
- Lowered stress and increase well-being.
- Better use of time and resources.
- Improved productivity including service delivery.