A Comprehensive Guide on Industrial Relations in HRM


Industrial relations encompass the study of labor relations, organizational behavior, and human resource management—industrial relations in HRM focus on the relationship between workers, organizations, and the government. The primary objective of HRM in industrial relations is to create an environment where organizations can thrive while providing opportunities for employees to succeed. 

Industrial relations statistics show that, over the past decade, workplace conflicts have risen to 54.2%. The most common conflict is between management and employees, followed closely by conflicts between employees themselves. 

What Is Industrial Relations? 

Let’s define industrial relations in HRM. Industrial Relations is a term used to define the relationship between workers and employers, and it also deals with the relationship between labor and management. 

The definition of industrial relations has been modified over time, but it has always included aspects such as wages, benefits, work hours, job security, and other terms of employment that affect employees’ welfare. The current definition of industrial relations in human resource management involves examining the labor-management issue regarding both human resources planning and organizational effectiveness. 

How Does HR Handle Industrial Relation? 

The HRM department is responsible for handling industrial relations. Human resource management and industrial relations are the functions that serve as the interface between management and employees. Industrial relations are a set of rules and processes that govern the relationship between an employer and its employees or between a trade union and an employer (or group of employers). 

The industrial relations aspect in HRM is an area of study that deals with the workplace and how it affects people, whether they are employed or self-employed. It uses scientific methods to analyze employment issues and develop solutions. This can include studying how employees react in certain situations or using surveys to find out what they think about their jobs. 

Staffing Challenges 

Employee relations and labor or industrial relations are both essential skills for the human resources manager of a unionized workplace. Office staff, supervisors, and managers are not included in a union’s bargaining unit, even in a union environment. Depending on its size and number of employees, the organization may hire both an employee relations specialist and a labor relations specialist, the latter handling industrial relations matters. 

National Labor Relations Act 

A thorough understanding of federal regulations pertaining to industrial relations is required by HR department employees and supervisors, and managers. According to the Economic Policy Institute, or EPI, the NLRA governs both employee rights and employer responsibilities. Everyone working in a unionized environment should understand the key points of the act. 

Employees who are union members and those who are non-union members are protected by the National Labor Relations Board, or NLRB. Whether employees approve of the collective activity or oppose it, employers and labor unions are prohibited from interfering with employees’ rights under the act. 

Collective Bargaining 

In a union workplace, wages, benefits, and working conditions are negotiated through collective bargaining between employers and labor unions. It is thus called a “bargaining unit” because it denotes the group of employees covered by the labor union contract and having a community of interests. 

Working knowledge of collective bargaining is essential for human resource management (HRM). The labor union contract is the center of industrial relations in HRM. According to the Bureau of Labor Statistics, HR managers are often required to negotiate on behalf of management. 

As part of human resources responsibilities, wage and benefit spreadsheets are prepared for new contract negotiations. Employers can use these spreadsheets to determine the impact of incremental wage increases. In collective bargaining, calculations such as these are useful for presenting the company’s proposals. 

Grievance Handling 

The management of the human resources department should be proactive when it comes to handling union grievances. A union employee has the right to file a grievance if he believes that he has been unjustly reprimanded or terminated. There are usually three steps involved in the grievance procedure when it comes to a union-employee grievance, which is handled by the HR manager or a labor relations specialist. 

As part of the grievance process, an employee’s interests are represented by a union steward. The case goes into arbitration if it is not resolved within the allotted three steps of the mediation process. There is no doubt, however, that arbitration can be just as long and costly as litigation, and both are processes that HR managers would prefer to avoid whenever they can. 


Industrial relations play a major role in human resource management. It is an important function of HRM that focuses on maintaining good relations between the company, its employees, and its business partners. It also deals with employee rights and workplace issues like unionization, etc. 

Industrial relations departments should be able to handle these issues effectively so that they don’t affect the productivity of your workforce. However, we recommend enrolling in the UNext Certificate Program in People Analytics & Digital HR to understand industrial relations deeply.

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