CHAPTER 1: INTRODUCTION

1.1 Concept of Industrial Disputes

All the issues referred to collective bargaining, may not be settled to the satisfaction of both the
parties. Such issues result in industrial conflicts/disputes. the long term trends in industrial
conflicts may be interpreted in terms of the factors and events that have occurred in the
political process, certain developmental factors such as the region in which the industry is
located, techno-economic factors such as labour intensive or capital intensive industries, the
sector in which the industry is operating, and the type of issues that have dominated some time
or the other. This paper deals with the course of industrial conflicts. The data point towards
factors contributing to the incidence of industrial conflicts in India

Industrial Disputes and their settlement have been provided in Industrial Disputes Act,
1947. The Act defines the relevant terms and also defines the Industrial Dispute, Industry and the
mechanism of the settlement of dispute. Now we will study different dimensions in detail.
The term „Industry‟ is equivalent to the Latin word ‘Industria’ this means ‘work’
Popularly the word industry refers to a systematic economic activity, a trade or manufacture
Which makes use of mechanical, chemical and power-driven machinery as well as organization
And intellectual aids in production.
The act was passed with a view to solve the disputes by various methods viz conciliation,
Adjudication etc. The object of the industrial relations legislation in general is industrial peace
And economic justice. The prosperity of any industry very much depends upon its
growing.

Reasons for Industrial Conflict

The causes of industrial disputes can be broadly classified into two categories: economic and
non-economic causes. The economic causes will include issues relating to compensation like
wages, bonus, allowances, and conditions for work, working hours, leave and holidays without

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pay, unjust layoffs and retrenchments. The non-economic factors will include victimization of
workers, ill treatment by staff members, sympathetic strikes, political factors, indiscipline etc.

Wages and allowances: Since the cost of living index is increasing, workers generally bargain
for higher wages to meet the rising cost of living index and to increase their standards of living.
In 2002, 21.4% of disputes were caused by demand of higher wages and allowances. This
percentage was 20.4% during 2003 and during 2004 increased up to 26.2%. In 2005, wages and
allowances accounted for 21.8% of disputes.
Personnel and retrenchment: The personnel and retrenchment have also been an
important factor which accounted for disputes. During the year 2002, disputes caused by
personnel were 14.1% while those caused by retrenchment and layoffs were 2.2% and 0.4%
respectively. In 2003, a similar trend could be seen, wherein 11.2% of the disputes were caused
by personnel, while 2.4% and 0.6% of disputes were caused by retrenchment and layoffs. In year
2005, only 9.6% of the disputes were caused by personnel, and only 0.4% was caused by
retrenchment.

Indiscipline and violence: From the given table, it is evident that the number of disputes caused
by indiscipline has shown an increasing trend. In 2002, 29.9% of disputes were caused because
of indiscipline, which rose up to 36.9% in 2003. Similarly in 2004 and 2005, 40.4% and
41.6% of disputes were caused due to indiscipline respectively. During the year 2003,
indiscipline accounted for the highest percentage (36.9%) of the total time-loss of all disputes,
followed by cause-groups wage and allowance and personnel with 20.4% and11.2% respectively.
A similar trend was observed in 2004 where indiscipline accounted for 40.4% of disputes.

Bonus: Bonus has always been an important factor in industrial disputes. 6.7% of the disputes
were because of bonus in 2002 and 2003 as compared to 3.5% and 3.6% in 2004 and
2005 respectively.

Leave and working hours: Leaves and working hours have not been so important causes of
industrial disputes. During 2002, 0.5% of the disputes were because of leave and hours of work
while this percentage increased to 1% in 2003. During 2004, only 0.4% of the disputes were
because of leaves and working hours.
Miscellaneous: The miscellaneous factors include
- Inter/Intra Union Rivalry
- Charter of Demands
- Work Load
- Standing orders/rules/service conditions/safety measures
- Non-implementation of agreements and awards etc.
The major causes of increasing number of lock outs are:
(a) Lower labor productivity,

(b) Rising wage rate,

(c) Increasing competition arising through the introduction of liberalization policy,

(d) Higher degree of bargaining power of employer etc.

Thus the bargaining power of the trade unions has weakened considerably due to the policy of
liberalization and restructuring introduced in the country in recent years.

Following are some of the provisions of the Act to settle industrial disputes in the country:

a) Work Committees:
Work committees are to be formed taking the employers and employees together for all
undertakings employing 100 or more workers for maintaining good relations between them. At
the end of December 1987, work committees were functioning in 546 establishments.

(b) Conciliation:
This Act permits the Government to appoint conciliation officers and also to constitute board of
conciliation, representing employers and workers for the settlement of such disputes.

(c) Court of Enquiry:

When conciliation failed to yield any result then the matter must be referred to court of enquiry
for making investigation on the dispute and report it to the Government.
(d) Labour Courts:
Labour Courts were set up by the State Governments to consider the disputed matters like
dismissal, suspension of employees, legality of strikes and lock-outs etc.

(e) Industrial Tribunals:

Two types of industrial tribunals were set up by the Government which includes: (i) state
tribunals and (ii) national tribunals. These tribunals are adjudicating disputes relating to wages,
bonus, profit sharing etc. The adjudications of these tribunals has a binding on the concerned
parties.

Arbitration in India

The Applicable Arbitration Law

The Indian Arbitration and Conciliation Act, 1996 the governing arbitration statute in India. It is
based on the Model Law on International Commercial Arbitration adopted by the United Nations
Commission on International Trade Law (UNCITRAL) in 1985.

Previous statutory provisions on arbitration were contained in three different enactments,

namely, the Arbitration Act, 1940, the Arbitration (Protocol and Convention) Act, 1937 and the
Foreign Awards (Recognition and Enforcement) Act, 1961. The Arbitration and Conciliation
Act, 1996 has repealed the Arbitration Act, 1940 and also the Acts of 1937 and 1961.

The Types of Arbitrations

The Indian Arbitration and Conciliation Act, 1996 applies to both domestic arbitration in India
and to international arbitration. Section 2(1)(f) of the Act defines "International Commercial
Arbitration" as arbitration relating to disputes arising out of legal relationships, whether
contractual or not, considered as commercial under the law in force in India where at least one of
the parties is:

1. An individual who is a national of, or habitually resident in any country other than India; or

2. A body corporate which is incorporated in any country other than India; or

3. A company or an association or a body of individuals whose central management and control
is exercised in any country other than India; or

4. The Government of a foreign country.

The Requirements of an Arbitration Agreement

• Section 7(3) of the Act requires that the arbitration agreement must be in writing.

• Section 7(2) provides that it may be in the form of an arbitration clause in a contract or it may
be in the form of a separate agreement.

• Under Section 7(4), an arbitration agreement is in writing, if it is contained in: (a) a document
signed by the parties, (b) an exchange of letters, telex, telegrams or other means of
telecommunication, providing a record of agreement, (c) or an exchange of claims and defense
in which the existence of the agreement is alleged by one party and not denied by the other.

• In section 7(5), it is provided that a document containing an arbitration clause may be adopted
by "reference", by a contract in writing.
 CHAPTER 3: ANALYSIS AND FINDINGS

Settlement of Industrial Disputes through Adjudication

In 2006 Government of Bangladesh enacted Bangladesh Labour Act, 2006 in order to settle
industrial dispute and to promote industrial peace and establish a harmonious and cordial
relationship between labour and capital by means of conciliation, mediation and adjudication
(Halim, 2007). The Act has been streamlined for some non-adjudicatory as well as adjudicatory
authorities. Non-adjudicatory includes, bipartite negotiation, Conciliation and Arbitration, while
adjudicatory (judicial) authorities include Labour Court, Labour Appellate Tribunal etc.

Bipartite Negotiation

Bipartite negotiation as a means to prevent and solve disputes helps develop harmonious
relationship between the management and workers. Bipartite negotiation takes place between the
employers and their employees over job–related affairs. The employees are usually represented
by their elected representatives who form the CBAs, while the employers are allowed to
participate in collective bargaining themselves or through their representative.

Conciliation

In simple sense, conciliation means reconciliation of differences between persons. In fact

conciliation can be taken as an extension of the function of collective bargaining or simply as
“assisted collective bargaining” in which the conflicting parties can have a fair chance of
settlement of industrial disputes through the services of expert negotiators. If bipartite
negotiation fails, any of the parties concerned may request the conciliator in writing, to conciliate
the dispute within 15 days from the date of the failure of collective bargaining. The practice of
conciliation is compulsory in Bangladesh before resorting to industrial action.

In fact, conciliation is a weak machinery in the settlement of disputes. As per the annual report of
Ministry of Labour and Employment 2012-13, only 172 industrial disputes which took place
before the conciliator among them 166 disputes has been solved and the rests are pending
(Annual Report of Ministry of Labour and Employment, 2013). There are some shortcomings in
the process which prevent the parties from reaching at an agreement:

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i. The choice of conciliator (or the composition of conciliation boards or committees,
where they are used partiality of the conciliator either in favour of the employers or
influenced by the labour front backed by the ruling party).
ii. Tendency to bribe trade union leaders during conciliation.
iii. Attendance at conciliation proceedings.
iv. Time limits for conciliation.
v. Showing of muscle power by trade union leaders during conciliation.

Arbitration

Arbitration is a process in which the conflicting parties agree to refer their dispute to a neutral
third party known as ‘Arbitrator’. Arbitration is a voluntary process for the settlement of
industrial dispute. When conciliation fails, arbitration may prove to be a satisfactory and most
enlightened method of resolving industrial dispute. The legal provisions relating to the process of
collective bargaining needs a brief discussion. If the conciliation fails, the conciliator tries to
persuade the parties to refer their dispute to an arbitrator. If the parties agree to refer the dispute
to an arbitrator for settlement, they make a joint request in writing to the arbitrator agreed upon
by them.

Adjudication by Labour Tribunal

The Adjudication system after the stages of bipartite negotiation and conciliation are exhausted,
the disputant parties may resort to settling their dispute by referring it to the arbitrator or by a
strike action or lock-out as discussed above or through the Labour Court. The Labour Court is
constituted with a Chairman and two Members to advise him, however, in the case of trial of an
offence or adjudication of any matter under Chapters Ten and Twelve it shall consist of the
Chairman alone. The Members of the Labour Court are appointed by the Government in
prescribed manner and to be the Chairman of the Labour Court, a person is to be the sitting
District Judge or Additional District Judge.

Adjudication by Labour Appellate Tribunal

Adjudication by Labour Appellate Tribunal, the Labour Appellate Tribunal has the power to hear
or dispose appeals from the Labour Court. It consists of a Chairman or if the Government deems
fit, of Chairman and such number of Members as determined by the Government. The Chairman
shall be a former Judge or Additional Judge of the Supreme Court and any Member thereof shall
have been a Judge or an Additional Judge of the Supreme Court or is or has been a District Judge
for at least three years. The Labour Appellate Tribunal on appeal may set aside, vary or modify
any award decision in judgment or sentence given by the Labour Court or send the case back to
the Court for re- hearing; and shall exercise all the powers conferred by the Code on the Labour
Court. The judgment of the Tribunal shall be delivered within a period of not more than 60 days
following the filing of the appeal.
 CONCLUSION & SUGGESTION

1. Industrial disputes denote work stoppages as well as those differences that are reported
and settled through the industrial relations machinery.
2. Most working days are lost through disputes about privatization or takeovers, and
negotiations about collective labour agreements.
3. In India dispute resolution process mainly involves -Litigation, Arbitration, Conciliation,
meditation.
4. A grievance is a complaint that the employees feels is serious enough to justify some
types of formal submission and action.
5. After the disciplinary action has been taken, the manger should attempt to assume a
normal attitude towards the employee.
6. Industrial relations are never a one-sided game but depend on the mutual understanding,
faith, and goodwill of all the participants in the industrial relation system.
7. For effective dispute resolution and settlement of differences between labour and
management, the best course is to prevent differences from developing into disputes.
8. It must be tried by the concerned parties to minimize the duration of strikes and lockouts
to assure the minimum loss of production and wages.
9. New legislations may be enacted and the existing laws may be amended.
10. There should be also an attempt to eliminate the corrupt practices, malpractices and
irregularities committed by the officials.

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 REFERENCES

1. https://en.wikipedia.org/wiki/IndustrialDisputes in India

2. Dutt Ruddar (1992). "Lockouts, Closure And The Role Of The State." The Indian Journal
Of Labour Economics, Vol. 35, No.1, p.3.

3. H. Das (1999). "Trade Union Activism Avoidable Or Inevitable?" Indian Journal Of

Industrial Relations, Vol. 35, No.2, p.232.

4. Leelavathi D.S. (2000). "Industrial Relations In India: Challenges And Strategies."

Southern Economist, Vol.39, No. 6, p. 17.

5. The Industrial Disputes Act, 1947, Section 2k.

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