INDUSTRIAL LAW

INDUSTRIAL RELATIONSIt Includes:

1)The Industrial Disputes Act 19472)The Trade Unions Act 1926

INDUSTRIAL DISPUTES ACT 1947

IntroductionThis is a principal central legislation which provides a

machinery for the settlement of industrial disputes.The Industrial Disputes Act,1947 was passed with a

view to removing certain shortcomings found in the working of the Trade Disputes Act 1929.

The Industrial disputes Act is a measure which seeks to pre-empt the industrial tensions , provide the mechanics of dispute resolutions and to set up the necessary infra-structure so that the energies of partners in production may not be dissipated in counter productive battles and assurance of industrial justice may create a climate of goodwill.

INDUSTRIAL DISPUTES ACT, 1947 As per section 2 (k) of Industrial Disputes Act1947,

Industrial Dispute is defined as any dispute or difference between employers and employers or between employers and workmen or between workmen and workmen which is connected with the employment or non-employment or the terms employment or with the condition of labour of any person

OBJECTIVES• Promotion of measures for securing and

preserving amity and good relation between the employers and workers

• Investigation and settlement of industrial disputes

• Prevention of illegal strikes and lock–outs• Relief to workmen in the matter of lay–off

and retrenchment• Promotion of collective bargaining

What is a DisputeThe term dispute means elements of differences

which endangers the industrial peace of the undertaking.

An Industry is a collective enterprise in which employers and employees are associated.

Any systematic activity carried on by co-operation between an employer and his workmen.

What is Industrial DisputeIndustrial Dispute means any dispute or difference

between-(i)Employers and Employers(ii)Employers and Workmen, or(iii)Workmen and workmen, which is connected with-(a)The employment or non-employment,(b)The terms of employment, or(c) The conditions of labour,Of any person,

For Example- Dismissal of a workman, disputes as to bonus, A dispute as to modification or revision of a production bonus scheme,etc.

• Where any employer discharges, dismisses, retrenches or otherwise terminates the services of an individual workman, any dispute or difference between that workman and his employer…….shall be deemed to be an industrial dispute notwithstanding that no other workman nor any union of workmen is a party to the dispute.

• “When parties are at variance and dispute or difference is connected with employment or non-employment or the terms of employment or with the conditions of labour, there comes into existence an Industrial Dispute”.

Definitions• Appropriate Government: Under the ID act some

industries fall under the central labour machinery and some others fall under the state labour machinery. helps us to determine under whose jurisdiction a particular industry falls and whether the state/central rules will apply.

• Award: It means an interim or a final determination of any industrial dispute by any Labour Court, Industrial Tribunal or national tribunal.

• Closure: It means the permanent closing down of a place of employment or part thereof.

WAGES – Sec 2(rr) It means all remuneration capable of being expressed in

terms of money, if the term of employment were fulfilled, be payable to a workman in respect of his employment or of work done in such employment.

INDUSTRY- Sec 2(i) Industry means any systematic activity carried on by co-

operation between an employer and his workmen whether such work men are employed by such employee directly or by or through any agency including a contractor for the production, supply or distribution of goods or services with a view to satisfy human wants or wishes with a motive to make any gain or profit; not merely spiritual or religious.

• Lay-Off: Lay–off means the failure , refusal or inability of an employer to give employment to a workman(a) whose name is borne on the muster rolls of his industrial establishment and(b)who has not been retrenched. The failure , refusal , or inability to give employment may be due to –

(i)Shortage of coal ,power or raw material, or(ii)The accumulation of stocks(iii)The breakdown of machinery(iv)Natural calamity or for any other connected reasons.Essentials of Lay –Off:• There must be failure or refusal or inability of the employer to

continue employees in his employment.• The employees laid –off must be on the muster-rolls of the

establishment on the day of lay-off.Laying off thus means putting aside or discharging workmen

temporarily.

• Lockout: A lockout is a work stoppage in which an employer prevents employees from working. It is declared by employers to put pressure on their workers. This is different from a strike, in which employees refuse to work. Thus, a lockout is employers’ weapon while a strike is raised on part of employees.

It means the temporary closing of a place of employment ,or the suspension of work ,or the refusal by an employer to continue to employ any number of persons employed by him.

A lockout is a weapon available to the employer to persuade by a coercive process the employees to see his point of view to accept his demands.

• Retrenchment : It means “to end , conclude , or cease”.It means the termination by the employer of the service of a workman for any reason whatsoever , otherwise than as punishment inflicted by way of disciplinary action.

DifferencesLock-out

• Lockout is temporary• Lockout keep this

relationship alive even during cessation of work.

• Lockout is with a motive to coerce the workmen to accept the demands of the employer.

• Lockout is due to and during an industrial dispute.

Retrenchment

• Retrenchment is permanent.

• Retrenchment results in complete severance of relationship between the employer and employee.

• Retrenchment is resorted to dispense with surplus labour.

• There is no such dispute in case of retrenchment.

• Strikes: It means a cessation of work by a body of persons employed in any industry acting in combination, or refusal under a common understanding of any number of such persons to continue to worker to accept employment. A strike is spontaneous and concerted refusal of work and withdrawal of labor from production temporarily. It is a collective stoppage of work for pressurizing their employers to accept certain demands. In the constant tussle of employees and employer, the strike is the weapon of employees. it is resorted to by workmen to bring pressure upon the employer to concede to their demands during an industrial dispute

Machinery For The Settlement of Industrial Disputes In India

When the relationship between the parties is not cordial, discontentment develops and conflicts erupt abruptly. It is not always easy to put out the fires with the existing dispute-settlement machinery, created by the government. Hence both labour and management must appreciate the importance of openness, trust and collaboration their day-to-day dealings.

Industrial Relations And Industrial Disputes

Machinery for Prevention and Settlement of Industrial Disputes

Industrial Relations And Industrial Disputes

Machinery for prevention and settlem ent of disputes

Volu n ta ry M eth o d s

Collective Bargaining

Trade Unions

Joint consultations

Standing Orders

Grievance Procedure

Code of Discipline

G o vern m en t M ach in ery

L a b ou r A d m in is t ra t ionMachinery

State Level

Central Level

Sta tu to ry M ea su res

Works Committees

Conciliation

(A) C .Officer(B ) C. Board

Arbitration

Adjudication

(a ) Labour Courts(b ) Industrial Tribunals(c ) National Tribunals

Ind

ustria

lD

ispu

tes

Act,

19

47

Sta

teA

cts

Industrial Relations And Industrial Disputes

Machinery For The Settlement of Industrial Disputes In India Works committees: As per the Industrial Disputes Act, 1947, works committees have to be set up all those industrial units which employ 100 or more persons. It is basically a consultative body

Giving greater participation to workers Ensuring close interaction between labour and management Generating cooperative atmosphere for negotiation between

parties Opening the doors to unions to have a clear view of what is going on within the unit Strengthening the spirit of voluntary settlement of disputes

Conciliation machinery

1. works committees (sec.3) It consists of representatives of employers and

workmen's engaged in the establishment.Powers and duties : To promote measures for securing and preserving

goodwill and good relations between employers and workmen

Comment upon matters of their common interest or concern

Endeavour to compose any material difference of opinion in respect of such matters.

Dr.M.Latha Natarajan

Joint Management Councils: The JMC normally consists of equal number of representatives of workers and employers looking after three things: information sharing, consultative and administrative matters relating to welfare, safety, training etc and the formulation of standing orders.(of course, without encroaching on the jurisdiction of works committees)

Standing orders: These are the rules and regulations which govern the conditions of employment of workers. The Industrial Employment (standing orders) Act of 1946 provides for the framing of standing orders in all industrial undertakings employing 100 or more workers.

Grievance procedure: A model grievance procedure as suggested by the Indian Labour Conference, 1958 has more or less been widely accepted in India now.

Code of discipline: It consists of a set of self-imposed obligations voluntarily formulated by the central organisation of workers and

employers.

Industrial Relations And Industrial Disputes

Machinery For The Settlement of Industrial Disputes In India

Industrial Disputes: Settlement Machinery

Industrial Relations And Industrial Disputes

Conciliation: The practice by which the services of a neutral third party are used in a dispute as a means of helping the disputing parties to reduce the extent of their differences and to arrive at an amicable settlement or agreed solution.

1. Conciliation officer (sec.4) : an authority appointed by the government to mediate disputes between parties brought to his notice; enjoying the powers of a civil court. He is supposed to give judgement within 14 days of the commencement of the conciliation proceedings.

Duties :To hold conciliation proceedings.To investigate the disputeTo send a report and memorandum of settlement to appropriate governmentTo send a full report Powers :Power to enter premisesPower to call for and inspect documents.

2.BOARD OF CONCILIATION

• In case Conciliation Officer fails to resolve the differences between the parties, the government has the discretion to appoint a Board of Conciliation.

• It consists of a chairman and two or four other members.

• The Board must submit its report to the government within two months of the date on which the dispute was referred to it. This period can be further extended by the government by two months.

Board of conciliation (sec.5) : The Board is an adhoc, tripartite body having the powers of a civil court created for a specific dispute(when the conciliation officer fails to resolve disputes within a time frame, the board is appointed)

Duties : To bring about a settlement of dispute To send a report and memorandum of settlement

to the appropriate govt. To communicate reasons to the parties if no

further references made To submit reports within 2 months Power : Power to enter premises Power to civil court

3.Court of enquiry: In case the conciliation proceedings fail to resolve a dispute, a court of enquiry is constituted by the government to investigate the dispute and submit the report within six months.

Courts of inquiry (sec,6)The appropriate government may constitute a court of inquiry

consisting 13 of one or more independent persons to enquire into any matter connected with or relevant to an industrial disputes. Where a court consists of two or more members, one of them shall be appointed as chairman.5. Labour courts (sec-7)The appropriate government may constitute one or more labour courts to adjudicate industrial disputes relating to any of the following matters1].

Duties : To inquire into the matters referred to it and report thereon To stand by the principles of fairplay and justicePowers : Power to enter premises Power of civil court

Industrial Relations And Industrial Disputes

Voluntary arbitration: It is the process in which the disputing parties show willingness to go to an arbitrator (a third party) and submit to his decision voluntarily.

Adjudication: It is the process of settling disputes compulsorily through the intervention of a third party appointed by the Government. The Industrial Disputes Act provides a three-tier adjudication machinery consisting of:

Labour court

Industrial tribunal

National tribunal

Machinery For The Settlement of Industrial Disputes In India

Arbitration

• Arbitration is a process in which the conflicting parties agree to refer their dispute to a neutral third party known as ‘Arbitrator’. Arbitration differs from conciliation in the sense that in arbitration the arbitrator gives his judgment on a dispute while in conciliation, the conciliator disputing parties to reach at a decision.

Types Of Arbitration1. Voluntary Arbitration: In voluntary arbitration both the

conflicting parties appoint a neutral third party as arbitrator. The arbitrator acts only when the dispute is referred to him/her. With a view to promote voluntary arbitration, the Government of India has constituted a tripartite National Arbitration Promotion Board in July 1987, consisting of representatives of employees (trade employers and the Government. However, the voluntary arbitration could not be successful because the judgments given by it are not binding on the disputants. Yes, moral binding is exception to it.

2. Compulsory Arbitration: In compulsory arbitration, the government can force the disputing parties to go for compulsory arbitration. In other form, both the disputing parties can request the government to refer their dispute for arbitration. The judgment given by the arbitrator is binding on the parties of dispute.

Adjudication• Adjudication: The ultimate legal remedy for the

settlement of an unresolved dispute is its reference to adjudica tion by the government. The government can refer the dispute to adjudication with or without the consent of the disputing parties. When the dispute is referred to adjudication with the consent of the disputing parties, it is called ‘voluntary adjudication.’ When the government herself refers the dis pute to adjudication without consulting the concerned parties, it is known as ‘compulsory adjudication.

ADJUDICATION MACHINERY Secs. 7 pertain to the constitution of adjudication

authorities under the Act. These authorities are:1. Labour courts (sec. 7) Appointment and constitution. The

appropriate government may, by notification in the official Gazette, constitute one or more Labour courts for adjudication of industrial disputes relating to any matters specified in the second schedule

Labour Court • Under Section 7 of the Industrial Disputes Act, 1947,

the appropriate Government by notifying in the official Gazette, may constitute Labour Court for adjudication of the industrial disputes.

• The labour court consists of one independent person who is the presiding officer or has been a judge of a High Court, or has been a district judge or additional district judge for not less than 3 years, or has been a presiding officer of a labour court for not less than 5 years.

• The labour court deals with the matters specified in the second schedule of the Industrial Disputes Act, 1947.

Issues that come under Labour Court

• 1. The property or legality of an employer to pass an order under the standing orders.

• 2. The application and interpretation of standing orders.

• 3. Discharge or dismissal of workers including reinstatement or grant of relief to workmen wrongfully dismissed.

• 4. Withdrawal of any statutory concession or privilege.

• 5. Illegality or otherwise of a strike or lockout.• 6. All matters other than those reserved for

industrial tribunals.

Matters within the jurisdiction of Labour courts* The property or legality of an order passed by an

employer under the standing orders.* The application and interpretation of standing orders.* Discharge or dismissal of workmen * Withdrawal of any customary concession or privilege.* Illegally or otherwise of a strike or lock-out* All matters other than those specified in third schedule.DUTIES:* To adjudicate upon industrial disputes relating to matters

specified in second schedule.* To give award within the specified period.

INDUSTRIAL TRIBUNAL• Under Section 7A of the Act, the appropriate

Government may constitute one or more Industrial tribunals for the adjudication of industrial disputes. Compared to labour court, industrial tribunals have a wider jurisdiction. An industrial tribunal is also constituted for a limited period for a particular dispute on an adhoc basis.

Issues that come underIndustrial Tribunal

• 1. Wages, including the period and mode of payment.• 2. Compensatory and other allowances.• 3. Hours of work and rest periods.• 4. Leave with wages and holidays.• 5. Bonus, profit sharing, provident fund, and gratuity.• 6. Classification by grades.• 7. Rules of discipline.• 8. Rationalisation.• 9. Retrenchment of employees and closure of an

establishment or undertaking.• 10. Any other matter that can be prescribed.

POWERS:Power to enter premises.Powers of civil court.Power to appoint assessors.Power to award costs.DUTIES: where an industrial dispute has been referred to a

tribunal for adjudication, it shall hold its proceedings expeditiously and shall, within the period specified in the order preferring.

National TribunalAppointments and constitution: The central government may, by notificationIn the official gazette, constitute one or more nationalindustrial tribunals for the adjudication of industrialdisputes which, in the opinion of central govt., involvequestions of national importance or are of such anature that industrial establishments situated in morethan one state are likely to be interested in, or affectedby, such disputes.[sec7-B)1].DUTIES: * Where an industrial dispute has been referred to national tribunal

for adjudication, * It shall hold its proceedings expeditiously .* Within the period specified in the order referring such industrial

disputes, submit its award to the appropriate govt. [sec 15]

National Tribunal

• This is the third one man adjudicatory body appointed by the Central Govern ment by notification in the Official Gazette for the adjudication of industrial disputes of national importance. The central Government may, if it thinks fit, appoint two persons as assessors to advise the National Tribunal. When a national tribunal has been referred to, no labour court or industrial tribunal shall have any jurisdiction to adjudicate upon such matter.

POWERS: 1. power to enter premises 2. powers of civil court 3. power to appoint assessors 4. power to award costs

Reference to national tribunalWhere the central govt., is of opinion that –1. Any industrial dispute exists2. Is apprehended 3. The dispute involves any question of national

importance4. Is of such a nature that industrial establishment

situated in more than one state are likely to be interested in ,or affected by , such dispute

5. That the dispute should be adjudicated by national tribunal