Industrial Relations

"Bolts & Nuts" is a company manufacturing and marketing bolts and nuts. This company had a fair share of the market in the said product. During the time of close economy with restrictions of the import of such items, the Company enjoyed a large market and was a profit making and successful organization with around 300 employees working in the factory.

After the Government which came into power introduced free economy and new policies that made difficulties to "Bolts and Nuts" Company and they gradually lost the market. They failed to increase the quality of the product and due to that they were unable to compete with imported foreign goods.

Not only that but also they could not achieve the targets because the unfavourable industrial relation of the company. There were no mutual understanding between work force and the management. Because of that frequent disciplinary actions were being taken against the workers. There were so many conflicts in the company thus it was running on losses and management unable to give benefits to the workforce. The workers constantly fought for their rights, demanding higher wages, incentives, bonus and more over time work etc. Management wanted to minimize those conflicts and to keep the company on track, therefore Management tried to reduce the labour force and reduce the cost. But because of that the situation became worst.

Even the Union and Management entered into a Collective Agreement it was also failed because employees found that the targets they had been agreed were unreachable. The workers explanation was that the machines were too old and frequent break downs interrupted production.

After changed of government, workforce left their previous union and joined to another union which was said to be pro-government. Due to that matter the Collective Agreement which they agreed also became invalid.

Environmental Authority found that this Company was not an environmentally suitable to the society and they were asked to adopt to an alternation system of diffusion of waste. Due to unbearable cost to adopt a new system Company decided to move out the factory 10 miles away from the Colombo. The Management thought this idea can be used as discontinue all the existing employees and recruit new employees at the new location.

Therefore they applied to the Commissioner of Labour in terms of the provision in the Termination of Employment of Workmen Act no.45 of 1971