A Study on Effectiveness of Grievance Handling Mechanism

A STUDY ON EFFECTIVENESS OF GRIEVANCE HANDLING MECHANISM

SUMMER PROJECT REPORT

Submitted by

R.GAYATHRI

REGISTER NO: 27348310

Under the guidance of

Mrs.R.HEMALATHA, MBA

Faculty, Department Of Management Studies

in partial fulfilment for the award of the degree

MASTERS OF BUSINESS ADMINISTRATION

DEPARTMENT OF MANAGEMENT STUDIES

SRIMANAKULAVINAYAGARENGINNERINGCOLLEGE

PONDICHERRYUNIVERSITY

PUDUCHERRY, INDIA

SEPTEMBER 2007

SRIMANAKULAVINAYAGARENGINEERINGCOLLEGE

MADAGADIPET, PUDUCHERRY

DEPARTMENT OF MANAGEMENT STUDIES

BONAFIDE CERTIFICATE

This is to certify that the project work entitled “A STUDY ONEFFECTIVENES OF GRIEVANCE HANDLING MECHANISM” is a bonafide work done by R.GAYATHRI [REGISTER NO: 27348310] in partial fulfilment of the requirement for the award of Master of Business Administration by Pondicherry University during the academic year 2007-2008.

GUIDE HEAD OF THE DEPARTMENT

Submitted for Viva-voce Examination held on ______

External Examiner

ACKNOWLEDGEMENT

It gives us great ecstasy of pleasure to convey our deep and sincere thanks to our Principal Dr. V.S.K. Venkatachalapathy, for his kind support, which helped us to complete the project successfully.

We have great pleasure in expressing our sincere gratitude and hearty thanks to our beloved Faculty, Mrs.R.Hemalatha, Department of Management Studies for consenting to be our guide. She had been a great source of encouragement and inspired us throughout our project. We are greatly thankful to her for everything she has done for us.

We would like to express our deepest gratitude to Mr.Jayakumar, Head of the Department, Department of Management studies for giving constant encouragement

We express our hearty thanks to Mr.D.Umamaheswaran, Senior Personnel Officer, Lucas –TVS Ltd., who provided valuable guidance throughout the project in his busy schedule.

We thank our Management, Department Staffs, andOur Parents for their support and above all to God for showering his blessing upon us.

A special word of thanks to all those we have failed to acknowledge.

ABSTRACT

This study focuses on Effectiveness of Grievance Handling Mechanism at Lucas-TVS Limited,Puducherry.

Grievance is any kind of dissatisfaction with regard to pay,promotion,suspension,working condition etc..

The objective of the study is to find the effectiveness of grievance handling mechanism being followed.

The sample size is 35 and the population size is 140.

The tools used for the study are Percentage method and Correlation.

The study infers that most of employees are highly satisfied with the mechanism being followed.

TABLE OF CONTENTS

LIST OF TABLES i

LIST OF CHARTS ii

CHAPTER / TITLE / PAGE NO.
I / INTRODUCTION
1.1 Profile of the organization / 1
1.2 Introduction to the study / 5
II / REVIEW OF LITERATURE / 6
III / OBJECTIVES OF THE STUDY / 12
IV / RESEARCH METHODOLOGY / 13
V / DATA ANALYSIS AND INTERPRETATION / 17
VI / 6.1 FINDINGS OF THE STUDY 6.2SUGGESTIONS, RECOMMENDATIONS / 35
37
VII / CONCLUSION / 38
VIII / SCOPE AND LIMITATIONS OF THE STUDY / 39

APPENDICES ANNEXURE I 40

ANNEXURE II 41

LIST OF TABLES

Table No. / Table name / Page No:
1.1 / List of products manufactured / 2
1.2 / Clients / 3
5.1 / Distribution of respondents regarding temporary relief / 17
5.2 / Distribution of respondents based on age / 18
5.3 / Distribution of respondents towards supervisors’ level of skill / 19
5.4 / Distribution of respondents towards awareness of committees / 20
5.5 / Distribution of respondents towards decision given / 21
5.6 / Distribution of respondents towards the informal channel / 22
5.7 / Distribution of respondents towards real basis of identification of their grievance / 23
5.8 / Distribution of respondents towards mechanism followed resolves grievance or not / 24
5.9 / Distribution of respondents towards importance given to discussion and conference / 25
5.10 / Distribution of respondents regarding whom they redress for grievance / 26
5.11 / Distribution of respondents based on qualification / 28
5.12 / Distribution of respondents regarding awareness of various committees / 29
5.13 / Distribution of respondents regarding regular follow up / 31
5.14 / Distribution of respondents regarding supervisors’ authority / 32
5.15 / Correlation between Feel about decision and Real basis identified. / 33
5.16 / Values for correlation / 33
5.17 / Correlation between Discussion and Conference And Supervisor’s Skill level / 34
5.18 / Values for correlation / 34

LIST OF CHARTS

Chart No: / Chart Name / Page No:
5.1 / Distribution of respondents regarding temporary relief / 17
5.2 / Distribution of respondents based on age / 18
5.3 / Distribution of respondents towards supervisors’ level of skill / 19
5.4 / Distribution of respondents towards awareness of committees / 20
5.5 / Distribution of respondents towards decision given / 21
5.6 / Distribution of respondents towards the informal channel / 22
5.7 / Distribution of respondents towards real basis of identification of their grievance / 23
5.8 / Distribution of respondents towards mechanism followed resolves grievance or not / 24
5.9 / Distribution of respondents towards importance given to discussion and conference / 25
5.10 / Distribution of respondents regarding whom they redress for grievance / 27
5.11 / Distribution of respondents based on qualification / 28
5.12 / Distribution of respondents regarding awareness of various committees / 30
5.13 / Distribution of respondents regarding regular follow up / 31
5.14 / Distribution of respondents regarding supervisors’ authority / 32

CHAPTER I

1.1 PROFILE OF THE COMPANY

Lucas - TVS was set up in 1961 as a joint venture of Lucas Industries plc., UK and T V Sundaram Iyengar & Sons (TVS), India, to manufacture Automotive Electrical Systems. One of the top ten automotive component suppliers in the world, Lucas Varity was formed by the merger of the Lucas Industries of the UK and the Varity Corporation of the US in September 1996. The company designs, manufactures and supplies advanced technology systems, products and services to the world's automotive, after market, diesel engine and aerospace industries.

The combination of these two well-known groups has resulted in the establishment of a vibrant company, which has had a successful track record of sustained growth over the last three decades.TVS is one of India's twenty large industrial houses with twenty-five manufacturing companies and a turnover in excess of US$ 1.3 billion. The turnover of Lucas-TVS and its divisions is US$ 233 million during 2003-2004.

Incorporating the strengths of Lucas UK and the TVS Group, Lucas TVS has emerged as one of the foremost leaders in the automotive industry today. Lucas TVS reaches out to all segments of the automotive industry such as passenger cars, commercial vehicles, tractors, jeeps, two-wheelers and off-highway vehicles as well as for stationary and marine applications. With the automobile industry in India currently undergoing phenomenal changes, Lucas-TVS, with its excellent facilities, is fully equipped to meet the challenges of tomorrow.

PRODUCTS

Lucas-TVS manufactures the most comprehensive range of auto electrical components in the country. A range which continues to set standards in the industry. The products are designed to meet the demands of vehicle manufacturers both in India and worldwide. With the emission standards in India becoming increasingly stringent, Lucas-TVS has ensured that each of its products is manufactured to meet global standards

LIST OF PRODUCTS MANUFACTURED

Lucas-TVSProductRange for Indian Market / Lucas-TVSProductRange for US/European Market
Starter Motor / Starter Motor
Alternator / Alternator
Headlamp / Small Motor
14W Wiper Motor
WindShield Wiper Motor (GM Range)
LRW Products
Small Motor
Wiper Motor
Blower Motor
Fan Motor / Dynamo Regulator
Dynamo Regulator / Dynamo
Dynamo / Auto Electricals
Ignition Coil
Distributor
Diesel fuel injection

CLIENTS

CUSTOMER / INTERNATIONAL COLLABORATOR
Cars
Maruti Udyog / Suzuki, Japan
Hindustan Motors / Isuzu, Japan. Mitsubishi, Japan
TATA Engineering and Locomotive Company
General Motors, India / General Motors, USA
Ford India / Ford, UK
Daewoo Motors Co., India / Daewoo, Korea
Ind Auto / Fiat, Italy
Hyundai Motors, India / Hyundai Motors, Korea
Tractors
Mahindra & Mahindra / International Harvestor Corporation,
UK
Tractors and Farm Equipments (TAFE) / Massey Ferguson, UK
Escorts / Ursus, Poland. Ford, UK
HMT / Zetor, Czechoslovakia
Eicher Tractors / Good Earth, Germany
Punjab Tractors
Gujarat Tractors / Zetor, Czechoslovakia
L&T Tractors / Johndeer, USA
Greaves Tractors / Same, Italy

DIVISIONS

Lucas TVS has grown hand in hand with the automobile industry in the country. The company's policies have recognised the need to respond effectively to changing customer needs, helping to propel it to a position of leadership. The company has raised its standards on quality, productivity, reliability and flexibility by channeling its interests.

At present, there are five divisions:

Auto Electricals L-TVS
Fuel Injection Equipment (FIE) - DTVS
Electronic Ignition Systems (INEL)
Automotive Lighting (IJL)
After Market Operations (LIS)

ACHIEVEMENTS

Lucas-TVS, a TVS group company, has bagged the prestigious Deming Application Award for the year 2004. This was announced by the Deming Prize Committee of Japanese Union of Scientists and Engineers (JUSE).

1.2 INTRODUCTION for the study

The aim of the study is to find whether the grievance handling mechanism ensures that employee’s problems are recognized and appropriately reviewed in a prompt and timely manner.

The grievance mechanism acts as a foundation for a harmonious and healthy relationship between employee and employer.

The grievance mechanism ensures a fair and just treatment of employee’s concerns and prompt resolution of grievances without discrimination, coercion, restraint or reprisal against any employee who may submit or be involved in a grievance.

CHAPTER II

REVIEW OF LITERATURE

GRIEVANCE

Grievance is any discontent or dissatisfaction that affects organizational performance. As such it can be stated or unvoiced, written or oral, legitimate or ridiculous. If the dissatisfaction of employees’ goes unattended or the conditions causing it are not corrected, the irritation is likely to increase and lead to unfavorable attitude towards the management and unhealthy relations in the organization.

The formal mechanism for dealing with such worker’s dissatisfaction is called grievance procedure. All companies whether unionized or not should have established and known grievance methods of processing grievances. The primary value of grievance procedure is that it can assist in minimizing discontent and dissatisfaction that may have adverse effects upon co-operation and productivity. A grievance procedure is necessary in large organization which has numerous personnel and many levels with the result that the manager is unable to keep a check on each individual, or be involved in every aspect of working of the small organization.

The usual steps in grievance procedure are

Conference among the aggrieved employee, the supervisor, and the union steward.
Conference between middle management and middle union leadership.
Conference between top management and top union leadership.
Arbitration.

There may be variations in the procedures followed for resolving employee grievances. Variations may result from such factors as organizational or decision-making structures or size of the plant or company. Large organizations do tend to have formal grievance procedures involving succession of steps.

Arbitration

Arbitration is a procedure in which a neutral third party studies the bargaining situation, listens to both the parties and gathers information, and then makes recommendations that are binding on the parties. Arbitration has achieved a certain degree of success in resolving disputes between the labour and the management. The labour union generally takes initiative to go for arbitration. When the union so decides, it notifies the management. At this point, the union and company must select an arbitrator.

Guidelines

When processing grievances, there are several important guidelines to consider:

Check the grievant’s title and employment status to determine if he / she are included in a union eligible classification.

Note the supervisor’s respondent obligation under the grievance procedure.

Review the requested solution to the grievance. Determine if the relief sought is beyond a supervisor’s authority to grant.

Review all policies or other information related to the grievance.

Conduct a thorough investigation of the allegations.

Prepare a written response including the reason for the decision and provide a copy to the grievant.

Grievance materials should be maintained in a separate file from either personnel files or records.

Articles related to grievance

Measures of supervisory behaviors and supervisor’s knowledge of the collective agreement should, intuitively, be related to the occurrence of grievable events, but there has been no theory advanced to explain grievable events. Kliener , Nigkelsburg and Pilarski implicitly assumed that supervisor monitoring of employees will increase the number of grievable events, but a theoretical basis or rationale for this assumed relationship is not discussed.

Grievants were less satisfied with their jobs, had poorer attitudes toward their line supervisors, had greater feelings of pay inequity, had stronger beliefs that workers should participate in decision-making, were less satisfied with their unions, and more active in their unions. The lower satisfaction with the union among grievant may be due to dissatisfaction with the processing of grievances. Grievants were more younger and had less education than nongrievants.

Gordon and Miller, Allen and Keavney and Klass note the important role that expectancy theory could play in differentiating grievants and nongrievants. Although not a complete test of expectancy theory, Lewin and Boroff did include the employees perceived effectiveness of the grievance procedure as an explanatory variable. Surprisingly, this was not significantly related to grievance filing. Further research focusing on expectancy theory and grievance filing that more fully develops testable hypotheses derived from expectancy theory seems appropriate.

Bemmels, Reshef and Stratton-Devine included the shop stewards assessment of how frequently employees approach them with complaints. Although most grievances are formally filed by employees, the initiation of a grievance can come from employees or stewards. Complaining to the shop stewards is the employees’ role in the grievance initiation process. Both of these studies found the work group with employees who complained to the stewards more frequently had grievance rates. Employees’ complaining to their stewards is a precursor to grievance filing. The measure of consideration and structure were significantly related to frequency of employee complaints in Bemmels and the steward’s assessment of the supervisors’ knowledge of the collective agreement was negatively related to complaints.

Lewin and Peterson found a positive relationship with grievance procedure structure and grievance rates. They also found higher grievance rates under procedures that include provisions for expedited grievance handling. It was found that provisions allowing oral presentation of grievances was related to lower rates of written grievances, and screening of potential grievances was related to lower rates of written grievance, and screening of potential grievances by a committee or other union officials was associated with lower grievance rates. The number of steps in the grievance procedure and the length of time allowed for filing a grievance were not related to grievance rates.

Lewin and Peterson argued that evaluations of grievance procedure effectiveness should include subjective evaluations by the participants as well as objective measures reflecting the operation of the grievance procedure. They argued that subjective evaluations are the preferred method for evaluating grievance procedure effectiveness. Effectiveness was difficult to interpret from measures reflecting the operation of grievance procedures such as grievance rates, settlement levels and arbitration rates since it was not clear what the optimal magnitudes might be for these measures. Furthermore the purpose of grievance procedure is to resolve disputes about the interpretation and application of collective agreements. Grievance procedures exist for the benefit of the employees, employers and unions. If the parties were satisfied with the operation of the grievance procedure, it seems to more important than attaining some predetermined optimal magnitude of grievance filing or when, where, and how grievances are being resolved.

Grievance procedures are related to other attitudinal measures and the behaviors of shop stewards in the grievance procedure. Grievance procedure effectiveness was related to union members’ overall satisfaction with the union. Grievance procedures have been found to relate to union commitment, employer commitment and dual commitment. Employer commitment has found to be negatively related to absenteeism and turnover and union commitment has found to have a positive relationship with union participation and with shop steward behavior in the grievance procedure. Many studies still report empirical analysis with no theoretical grounding, or only intuitive and ad hoc hypotheses.

Grievance could be classified into 4 basic types: Discrimination charges, rules violation, general or unclassified complaints and discipline.

Discrimination was spelled out as based upon race, sex, religion, color, national origin, age, veteran status, or handicapped.

Grievance corresponding rules violation was an employees’ interpretation of application of policies and procedures governing personnel policies, department work rules, unsafe or unhealthy working conditions, or other policies or procedures of a working nature.

Disciplinary actions are the category least classified as a grievance. Legalistic approach was used to handle such cases. With the possibility of adverse legal action arising from unjust discipline, separate systems are often established in discipline cases to ensure the employees’ complete due process rights.

Five types of grievance systems were typically noted in the literature. They were the open door policy, step-review method, peer-review also called the grievance committee or roundtable, ombudsman and hearing officer. In the public sector study. The predominant method of grievance adjudication was the step-review method used either singularly or in combination with a peer-review committee. The step-review method had characteristics similar to the grievance / arbitration procedures found in union contracts.

The step-review method has a preestablished set of steps for reviewing employee complaints by succeeding higher levels of agency personnel.

Benefits of having Grievance procedure:

The grievance procedure provides a means for identifying practices, procedures, and administrative policies that are causing employee complaints so that changes can be considered.

They reduce costly employment suits.

A grievance procedure allows managers to establish a uniform labour policy.

A grievance system can be a reliable mechanism to learn of, and resolve employee dissatisfaction. It can produce early settlements to disputes or provide for correction of contested employment issues.

CHAPTER III

OBJECTIVES OF THE STUDY

PRIMARY OBJECTIVE

To study the effectiveness of grievance handling mechanism.

SECONDARY OBJECTIVE

To identify whether the employees are aware of the grievance handling mechanism.

To identify whether the grievance handling system leads to a favorable attitude towards the management

To identify that the grievance handling system leads to a mutual understanding between workers and the management

To know the level of satisfaction towards the grievance handling procedure of the organization

To identify the factors influencing the effectiveness of the grievance handling in the organization

CHAPTER IV