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Arbitration of Labour Disputes PDF
Arbitration of Labour Disputes PDF
I. Section,. 3.
2. M.D. 'Ram.alcrishnan v:, Tamil Nadu Electricity Board. 1971 I LLJ 433.
435-36 (Mad), per Ramaprasada Rao, J.
3. 1960 I LLJ 580, 5U se, Per Das Gupta, J.
ARBITRATION OF LABOUR DISPUTES 29
Collective Bargaining
2. Conciliation-Mediation
12. Section 4.
13. Section 5.
14. Section 12.
15. Section 13.
32 LABOUR ADJUDICATION IN INDIA
3. Adjudication-Arbitration
(1) Adjudication
18. Workmen ofHindustan Lever Ltd. v. Hindustan Lever Ltd., 1984 Lab. IC 276
(286-87) (SC), per Desai, J.
34 LABOUR ADJUDICATION IN INDIA
(2) Arbitration
their disputes. The matter has been discussed for a decade at tripartite
forums but the progress has been marred due to indifference of the
parties.
The Indian Labour Conference in August 1962 reiterated the need
for a wider acceptance of 'voluntary arbitration'. This Conference was
of the view that "whenever conciliation fails, arbitration will be the
next normal step except in cases where the employer feels that for some
reason he would prefer adjudication".24 A proviso was also added by
the Conference to this Resolution to the effect that the parties concerned
must fully explain the reasons for refusal to agree to arbitration in each
case and the matter be brought up for consideration by the
implementation machinery. In the same year, the Industrial Truce
Resolution (November 1962) while reemphasising 'voluntary arbitration'
specified that complaints pertaining to dismissal, discharge, victimisation
and retrenchment of individual workmen which could not be settled by
mutual negotiation should be settled by voluntary arbitration.
The Third Five-Year Plan went a step further in suggesting that
"voluntary arbitration" should be the normal practice in preference to
recourse to adjudication. To make "voluntary arbitration" more
acceptable to the industrial employers and workers with a view to co-
ordinating efforts for its promotion, the Government of India has set up
a National Arbitration Promotion Board (NAPB) with a tripartite
composition. The function of this Board will be to examine and review
the factors inhibiting wider acceptance of this procedure and suggest
measures to make it more popular. The NAPB was also to evolve
principles, norms and procedure for the guidance of arbitrators and
parties. It would look into the causes of delay and expedite arbitration
proceedings wherever necessary and also specify from time to time the
types of disputes which would normally be settled by arbitration in the
light of tripartite decisions. All these efforts have been fruitless.
Arbitration has not gained any ground.
240. Ludwig Teller, Labour Disputes alld Collective Bargaining, vol. J 476 (1940).
25. 1949 J LLJ 245, 256 (FC), per Mahajan, J.
26. 1950 J LLJ 921, 948 (SC), per Mukherjea, J.
27. 1956 II LLJ 444, 449 (SC), per Das, J.
ARBITRATION OF LABOUR DISPUTES 39
30. Niemla Textile Finishing Mills Ltd. v. Second Punjab Tribunal, 1957 1 LLJ
460 (SC). per Bhagwati, J. See also Assam Chah Karmachari Sangha v. Assam Co.
Ltd., 1956 I LLJ 157 (LAT).
31. See for instance. Rai Bahadur Diwan Badrt Das v, Industrial Tribunal,
Punjab, 1962 II LLJ 366, 370 (SC), per Gajendragadkar, J.; JK Cotton Spinning
and WeaVing Mills Co. Ltd. v, Labour Appellate Tribunal. 1963 IJ LLJ 436. 444
(SC), per Gajendragadkar, J.; Patna Electric Supply Co. Lid. v. Patna Electric
Supply Co. Wokers' Union, [1959] II LLJ 366 (SC), per Gajendragadkar. J.
32. Punjab National Bank Ltd. v. Industrial Tribunal, 1957 I LLJ 455. 458 (SC).
per Das, J.
33. General Secretary. Madras Harbour Workers' Union v. lndustrlal Tribunal,
1972 I LLJ 8, 14 (Mad). per Palaniswamy. 1. Malabar Motor Transpori Co-operative
Society Ltd. for Ex-Servicemen v. Malabar M. T. Co-operative Society Ltd. for Ex-
Servicemen Employee Association. 1980 Lab. IC 324, 325 (Ker) DB). per Gopalan
Nambiyar, CJ reversing the decision of the singal Judge in Malabar Motor Transport
Co-operative Society Ltd. for Ex-Servicemen v. Their Employees. 1979 II LLJ 468
(Ker) per Bashkaran, J.
34. Bharat Bank Ltd. v, Employees of Bharat Bank Ltd., supra note 26 at 932.
ARBITRATION OF LABOUR DISPUTES 41
35. Ibid., see also J.K. Iron & Steel Co. Ltd. v, Iron & Steel Mazdoor Union,
1956 J LLJ 227 (SC), per Bose, J. and Walford Transport Ltd. v, First Industrial
Tribunal, 1961 II LLJ 25 (Cal.), per Ray, 1.
36. Sussanah Sharp v. Wakefield, [1891] AC 173 (179), per Lord Halsbury, LC.
37. Supra note 27.
38. 1961 I LLJ 521, 526 (SC). These limitations were adumbrated by the majority
of the court consisting of Gajendragadkar, Sarkar, Wanchoo, and Madholkar, JJ.,
but Subba Rao, J., dissented and did not subscribe to the majority view. He took the
view that, "an industrial tribunal can extend an existing agreement or make a new
one, if, for good reasons it comes to the conclusion that such extension promoted
industrial peace". Even accoridng to Subba Rao, J., existing contracts can be interfered
with by the tribunal's though only "for good reasons". But the scope of "good
reasons" mentioned by Subba Rao, J. apears to be different from the limitations
suggested by the majority.
39. Rai Bahadur Diwan Badri Das v: Industrial Tribunal, Punjab, and JK
Cotton Spinning & Weaving Mills Co. Ltd. v. Labour Appellate Tribunal, supra
note 31.
42 LABOUR ADJUDICATION IN INDIA
Nor can the tests and the principles that have been laid down be
applied mechanically or by way of syllogism. A mechanical or
40. Delhi Cloth & General Mills Ltd. v. Its Workmen. 1969 II LLJ 755. 767
(sq. The Court referred to statement of law by Douglas. J.. of Supreme Court of
the United States of America in United Steel Workers of America v. Enterprise
Wheel and Car Corporation, [1960] 363 US 593. But after citing the passage. the
Court immediately observed: "We may at once state that we are not for a moment
suggesting that the law of industrial relations developed in our country has proceeded
on lines parallel to the direction of the law in the United States".
41. R.B. Dewan Badri Das v. Industrial Tribunal, supra note 3 I.
42. Remington Rand of India Ltd. v. The Workmen. C.As. No. 856. 1475 and
21 19 of 1968 decided by the Supreme Court on 10.12.98, per Shelat, J. (unreported).
43. Workmen ofDharampal Premchand, (Saughandhi) v. Dharampal Premchand
(Saughandhi), 1965 J LLJ 668, 673 rsci per Gajendragadkar, C,J.
44. Hartnagar Cane Farm v. State of Bihar. 1963 J LLJ 692, 695 (SC). per
Gajendragadkar, J.; State of Bombay v. Hospital Mazdoor Sabha, 1960 J LLJ 251,
257 rsci, per Gajendragadkar. J.
45. State of Bombay v. Hospital Mazdoor Sabha, ibid., see also Harinagar Cane
Farm v, State of Bihar, tbtd., and University of Delhi v, Ram Nath, 1963 " LLJ
335, SC, per Gajendragadkar, J.
ARBITRATION OF LABOUR DISPUTES 43
46. Westerll India Match Co. Ltd. v, Their Workmen, 1963 II LLJ 459, 463-64
(SC).
47. N.R. Mukherjee v. Arnold Hartman Just. AIR 1961 Cal 95 (DB), per Lahiri,
CJ
48. Workmen of Dahingeapar Tea Estate v. Dahingeapar Tea Estate. 1958 II
LLJ 498 (SC), per S.K. Das, J; Kays Construction Co. (P.) Ltd. v, Its Workmen,
1958 IJ lLJ 660, 665 (S.C.), per Gajendragadkar, J.
49. 1969 II LLJ 755, 767-68 (SC).
44 LABOUR ADJUDICA TION IN INDIA
50. Rifle Factory Co-operative Society Ltd. v. Fourth Industrial Tribunal. 1960
II LLJ 517, 521 (Cal), per P.B. Mukharji, J.
51. J.K. Iron & Steel Co. Ltd. v. Iron & Steel Mazdoor Union, supra note 35 at
234; Newspapers Ltd. v, State Industrial Tribunal, 1975 I LLJ 32 (All) (DB); N.R.
Mukherjee v. Arnold Hartman Just. supra note 47; Parry & Co. Ltd. v. P.e. Pal.
1970 II LLJ 429, 438 (SC), per Shelat, J.
52. Parry & Co. Ltd. v. P.C. Pal, 1970 II LLJ 429,438 rsci, per Shelat, J.
53. Harinagar Cane Farm v. State of Bihar, supra note 44.
54. Rai Bahadur Diwan Badri Das v, Industrial Tribunal Punjab, supra note 31
at 371; Harinagar Cane Farm v. State of Bihar, supra note 44.
55. State of Bombay v. Hospital Mazdoor Sabha, supra note 44., per
Gajcndragadkar, J. Rai Bahadur Diwan Badri Das v. Industrial Tribunal, Punjab,
supra note 31.
ARBITRATION OF LABOUR DISPUTES 4S
56. Rai Bahadur Diwan Badri Das v, Industrial Tribunal, Punjab, supra note
31: Harinagar Cane Farm v. State of Bihar. and State of Bomba)' v. Hospital
Mazdoor Sabha, supra note 44: See also notes and comments under the caption
"Scope of adjudication by Tribunals" under section 7 and also under section 1O(4).
57. The observation of Hidayatullah, 1. in Madras Gymkhana Club Employees'
Union v, Gymkhana Club, 1967 II LLJ 720 (SC) construing the definition of industry
in section 2(j); "The attempt to avoid generalisations (however commendable) has
one disadvantage...our task is to give meaning to the words which are intended to
lay down the full connotation.
58. State of Bombay v, Hospital Mazdoor Sabha, supra note 44.
59. Basti Sugar Mills Co. Ltd. v. State of UiP: 1978 /I LLJ 412, 419 (SC).
46 LABOUR ADJUDICATION IN INDIA
60. J.X. Callan Spinning and Weaving Mills Co. Ltd. v. Labour Appl/ale Tribunal,
supra note 31.
61. 1985 Lab. IC 1733 (1738) (SC> per Khalid, J. See also: S.K. Verma v.
Mahesh Ohal1dra. 1983 Lab. IC 1483, 1484 (SC>, per Chinnappa Reedy, J.; D.P.
Mal,eshwari v. Delhi Administration, 1985 Lab. IC 1629 (SC), per Chinnappa Reddy,
J.; Cooper Engineering Ltd. v. P.P. MUI/dhe. 1975 II LLJ 379. 385 (SC>, per
Goswami, J.
62. Assam Chah Karmachari Sal/gila v. Assam Co. Ltd.. 1956 I LLJ 157 (LAT).
ARBITRATION OF LABOUR DISPUTES 47
69. State of Mysore v. Workers ill Gold Mines. supra note 67. Reference was
made to articles, 38 and 41 of the Constitution.
70. supra note 31. In the majority Judgment in this case and in the case noted in
the above footnote, no reference was made to the observations of Bhagwati, J., in
Muir Mills case, supra note 64.
71. Ibid at 378.
72. Rashtriya Mill Mazdoor Sallgh v. Apollo Mills Ltd., 1960" L.L.J. 263, 271
(SC). See also Western India Automobile Association v. Industrial Tribunal. 1949 I
LLJ 245, 256 (FC), per Mahajan, J. State of UP v. Muir Mills Co. Ltd., 1967 II LLJ
598, 60 I (All) (DB), per Jagdish Sahai, J.
73. Supra note 31; see also Hindustan Steel Ltd. v. State of Orissa, 1968" LLJ
526 (Ori) (DB), per S.K. Ray, J.
ARBITRATION OF LABOUR DISPUTES 49
The first part of section lOA requires the parties to forward a copy
of the arbitration agreement to the appropriate government and the
conciliation officer and the second part further requires the appropriate
government to publish the agreement in the official gazette within "one
month" from the date of the receipt of such copy. In both the cases, the
legislature has used the imperative word 'shall'. In Kamal Leather
Karamchari Sanghatan v. Liberty Footwear Co.,79 the Supreme Court
has held that the 'arbitration agreement' must be published before the
arbitrator considers the merits of the dispute and noncompliance of this
requirement would be fatal to the arbitral award. In other words,
publication of the arbitration agreement in the official gazette is a
mandatory condition, non-compliance of which would invalidate the
arbitral proceedings and the award, while the requirement of publication
within a period of one month from the date of the receipt of the agreement
by the government is merely directory. According to this holding the
award may be published at any time "before the arbitrator considers the
merits of the case".
(2) Practice
The jurisdiction of the industrial arbitrator stems from the' agreement
of arbitration' to adjudicate upon an industrial dispute. In other words,
the jurisdiction to entertain an industrial dispute is conferred on the
arbitrator by the specific agreement entered into by the parties to abide
by his decision. From the language of the section. it is evident that what
an arbitrator can adjudicate upon is "dispute". It is significant to note
that unlike section 10 (4), an arbitrator has no jurisdiction to adjudicate
upon any "matters incidental thereto". The arbitrator, therefore. has
strictly to confine his adjudication to the dispute as referred to him by
the agreement of the parties. There is a marked contradistinction between
section 10(4) and section lOA (4). Hence, an arbitrator is "bound to
adjudicate on the dispute as specifically referred in terms of the
agreement and could not go into any other matters whether connected
with or relevant or incidental to the dispute which was referred to him " !In
The reference under section lOA is not fettered by Schedule II or
Schedule III. Any 'industrial dispute' can be referred to an arbitrator
whether in Schedule II or Schedule III or otherwise. But once an
industrial dispute is before the arbitrator for arbitration. the scope of
adjudication is analogous to that of the industrial tribunal.U
The arbitration proceedings before an arbitrator are quasi-judicial
in character. The question whether such an award should state reasons
for its decision. has given rise to conflicting judicial dicta. A Division
Bench of the Punjab High Court. 82 though did not state as a general
proposition that an industrial arbitrator must record his reasons for
coming to his conclusion in the award, preferred the view that "the law
does not intend to confer on the arbitrator under the Act uncontrolled
and absolute power to make the award completely bare of reasons so as
to render it incapable of judicial scrutiny..." It was further observed that
"as an arbitrator had to decide a proposal and an opposition, in other
words, to determine. a lis, the decision which he had to give could not
83. M.G. Pans v, S.K. Sanyal, 1980 Lab IC 524, 526-27, (MP) (DB), per G.P.
Singh, CJ.
84. Rohtas Industries Ltd. v, Workmen of Rohtas Industries Ltd., \968 \ LLJ
710, 715-716 (Pat) (DB), per Dutta, J.
85. Management ofDally Aljamiat v, Gopi Nath Aman, 197\ Lab IC 1353 (Del),
per Rohtagi, J.
ARBITRATION OF LABOUR DISPUTES S3
(3) Award
7. Judicial Review
103. National Project Construction Corp. Ltd. v. Their Workmen, 1970 Lab. Ie
907 (913) (Pat) (DB), per Misra. CJ; affirmed by the Supreme Court in Management
of National Projects Construction Ltd. v. Their Workmen, 1976 I LLJ 86 (sq, per
Alagiriswami, J. But the decision of the high court was partly reversed on another
point.