The Industrial Disputes Act 1947

The Industrial Disputes Act 1947 extends to the whole of India and regulates Indian labour law
so far as that concerns trade unions as well as Individual workman employed in any Industry
within the territory of Indian mainland. It came into force 1 April 1947.

The objective of the Industrial Disputes Act is to secure industrial peace and harmony by
providing machinery and procedure for the investigation and settlement of industrial disputes by
conciliation, arbitration and adjudication machinery which is provided under the statute. The
main and ultimate objective of this act is “Maintenance of Peaceful work culture in the Industry
in India” which is clearly provided under the Statement of Objects & Reasons of the statute. The
laws apply only to the organized sector.

The Act also lays down:

 The provision for payment of compensation to the workman on account of closure or lay
off or retrenchment.
 The procedure for prior permission of appropriate Government for laying off or
retrenching the workers or closing down industrial establishments
 Unfair labour practices on part of an employer or a trade union or workers.

Objective and Applicability of Industrial Disputes Act, 1947

The main objective of the industrial Disputes Act, 1947 is to investigate and thereafter come to a
settlement of any industrial disputes, primarily between employers and employees. A workman
having no supervisory or administrative capacity can raise an industrial dispute before the
competent authority. Furthermore, collective disputes can also be raised by the union.

The Industrial Disputes Act was enacted with the purpose of providing a permanent machinery
for the settlement of industrial disputes which had become a common feature due to industrial
unrest in the wake of post-war problems arising out of constant strife between employers and
employees.

The results were industrial unrest and fall in production. An attempt was made to achieve the
objective

(i) By improving the service conditions of industrial labour so as to provide for them the ordinary
amenities of life and

(ii) By that process to bring about industrial peace which would in turn increase the pace of
productive activities in the country and result in prosperity.

Principal objects of the Act are

(1) The promotion of measures for securing amity and good relations between the employer and
workmen;
(2) An investigation and settlement of industrial disputes between employers and employees,
employers and workmen and between workman and workmen, with a right of representation by a
registered Trade Union orFederation, of Trade Unions or association of employees or a
federation or association of employers;

(3) The prevention of illegal strikes and lockouts; and

(4) Relief to workers in the matters of layoff and retrenchment.