NMIMS, BANGALORE

PGDM 2019-21

Legal Framework of Industrial Relations-

Unfair Labour Practises

Under the guidance of Prof. Dr. Deepak Sharma

Name Roll No. SAP No.

Mitali Jadhav A026 80203190071
Saurabh Pratap Singh B040 80203190169
INTRODUCTION TO UNFAIR LABOUR PRACTISES
In modern industrial society, industrial relations are one of the most delicate & complex problems.
Industrial progress is not possible without cooperation of both the employees and employers in
industrial setup. It has been clearly understood that industrial relations don’t emerge in vacuum. In
fact, according to Industrial Act 1947 industrial relation is a relation between employer employees,
employees and employers and employees and trade unions.
The healthy industrial relations are key to progress and success. Their significance is discussed
below:
1)Uninterrupted production – One of the key benefits of industrial relation is that it ensures
continuity of production. The resources are fully utilized resulting in maximum possible output. The
benefits are shared by other connected industries too. There is uninterrupted flow of income for all.
2)Reduction in industrial disputes: Good industrial relations reduce the industrial disputes. Although
IR are characterized by both conflicts and co-operations so a good industrial help in reducing the
conflicts. Strikes, lockouts, go-slow tactics, gherao and grievances are some of the reflections of
industrial unrest which do not spring up in an atmosphere of industrial peace.
3)Other benefits may include high morale, mental revolution and reduced wastage in relation to
healthy industrial relations.
Thus, it is evident that good industrial relations are the basis of higher production with minimum
cost and higher profits. It also results in increased efficiency of workers. New and new projects may
be introduced for the welfare of the workers and to promote the morale of the people at work. An
economy organized for planned production and distribution, aiming at the realization of social
justice and welfare of the massage can function effectively only in an atmosphere of industrial
peace. If the twin objectives of rapid national development and increased social justice are to be
achieved, there must be harmonious relationship between management and labour.
Unfair labour practise usually creates an environment which tends to disturb the delicate balance
between the relationship of employer and employee. It leads to following:
a) Mental pressure on the part of employee and employer
b) Wage structure being fixed inadequately so as to take away right of workers
c) Unhealthy working environment for the employees
d) Unlawful retrenchment, lock-outs & dismissals on the part of management while unlawful
strikes on the part of the workers
e) Lack of human relations skill on the part of supervisors and other managers
f) Inappropriate introduction of automation without providing the right climate;
g) Inadequate welfare facilities
h) Dispute on sharing the gains of productivity

Unfair labour practise lead to bad industrial relations in an industrial setup. The organisation
where industrial are strained, a lot of problem arises. The atmosphere of such organisations is
surcharged with unrest leading to strikes or lock-outs. Production goes to a high cost and it
adversely affects the efficiency. The situation is further affected by absenteeism among the
workers, high rate of labour turns over etc.

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Effects of unfair labour practises to different stakeholders is summarised below:

Loss of wages , Physical injury or death , Excesses by employers

Workers
Economic losses, Bitterness in relations, Adverse affect on career.

Less production, Less Profit, Bad affect on organisation and human relations.
Employers
Damage to machines and equipments, Burden of fixed expenses.

Loss of revenue(less recovery of income tax. sales tax, etc.) 

Government
Lack of order in society, Blame by different parties,

Rise in prices , Scarcity of goods, Bad affect on quality of goods.

Consumers

Adverse affect on International Trade, Hindrance in Economic Development of

Other the country, Uncertainty in economy.
Stakeholders

To conclude, we can say that all the sections of the society because of the unfair labour practises
in an industrial setup. In order to maintain peace in industrial units it is of utmost importance
that harmony is establish between the employers and employee.

Therefore, to protect and promote the effectiveness of the union at the workplace, we need to
consider the unfair labour practice complaint as but one option among a variety of tools and
strategies.

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UNFAIR LABOUR PRACTISES

According to Sec.2 (ra) of the Industrial Disputes Act, 1947, unfair labour practices refer to “any of
the practices specified in the Fifth Schedule to the Industrial Disputes Act, 1947.
According to Section 25T of the Industrial Disputes Act, 1947 no employer or workman or a trade
union, whether registered under the Trade Unions Act, 1926 or not, shall commit any unfair labour
practice.
Fifth Schedule to the Industrial Disputes Act, 1947 provides a list as to what constitutes an unfair
labour practice:
1.Unfair labour practices on the part of employers and trade union of employers
1. To interfere with, restrain from or coerce workmen in the exercise of their rights to organize
from, join or assist a trade union, or to engage in concerted activities for the purposes of collective
bargaining or other mutual aid or protection, i.e.
a) Threatening workmen with discharge or dismissal, if they join a trade union
b) Threatening a lock out or closure if a trade union is organized.
c) Granting wage increase to workmen at crucial periods of the union organisation, with a view
to undermining the efforts of the trade union organization
2. To dominate, interfere with or contribute, support, financially or otherwise to any trade union,
that is to say: -
a) An employer taking an active interest in organizing a trade union of his workmen and
b) An employer showing partiality or granting favor to one of several trade unions
attempting to organize his workmen or to its members where such a trade union is not a
recognized trade union.
3. To establish employer sponsored trade unions of workmen.

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4. To encourage or discourage membership in any trade unions by discriminating against workman,
that is to say: -.
a) Discharging or punishing a workman, because he urged other workmen to join or organize a
trade union.
b) Discharging or dismissing a workman for taking part in strike (not being a strike which is
deemed to be an illegal strike under this act)
c) Changing seniority rating of workmen because of trade union activities
d) Refusing to promote workmen to hire posts on account of their trade union activities
e) Giving unmerited promotions to certain workmen with a view to creating discord between
other workmen or to undermine the strength of their trade union
f) Discharging office bearers or active members of the trade union on account of their trade
union activities
5. To discharge or dismiss workmen
a. By way of victimization
b. Not in good faith but in the colorable exercise of the employer’s right
c. By falsely implicating a workman in a criminal case on false evidence or concocted
evidence
d. For patently false reasons
e. On untrue or trumped up allegations of absence without leave
f. In utter disregard of the principles of natural justice.
g. For misconduct of minor or technical character, without having any regard to the
nature of the particular misconduct or the past record of service of the workman,
thereby leading to disproportionate punishment.
6. To abolish the work of a regular nature being done by workmen and to give such work to
contractors as a measure of breaking a strike.
7. To transfer a workman malafide from one place to another under the guise of following
management policy.
8. To insist upon individual workman who are on a legal strike to sign a conduct bond as a
precondition to allowing them to resume work
9. To show favouritism or partiality to one set of workers regardless of merit.
10. To employ workmen as ‘badlis’, casuals or temporaries and to continue them as such for the
years with the object of depriving them of the status and privileges of permanent workmen.
11. To discharge or discriminate against any workmen for filing charges or testifying against
employer in any enquiry or proceeding relating to any industrial dispute.
12. To recruit workmen during a strike which is not an illegal strike.
13. Failure to implement award, settlement or agreement.
14. To indulge in acts of force or violence.
15. To refuse to bargain collectively, in good faith with the recognized trade unions.
16. Proposing or continuing a lock out deemed to be illegal under this act.

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2.Unfair labour practices on the part of workmen and trade unions of workmen
1. To advise or actively support or instigate any strike deemed to be illegal under the Industrial
Disputes Act, 1947.
2. To coerce workmen in the exercise of their right to self-organization or to join a trade union or
refrain from joining any trade union, that is to say
a) For a trade union or its members to picketing in such a manner that non striking workmen are
physically debarred from entering the work places
b) To indulge in acts of force or violence or to hold out threats of intimidation in connection with a
strike against non-striking workmen or against managerial staff.
3. For a recognized union to refuse to bargain collectively in good faith with the employer.
4.To indulge in coercive activities against certification of bargaining representative.

5.To stage, encourage or instigate such forms of coercive actions and wilful ‘go slow’, squatting on
the work premises after working hours or ‘gherao’ of any of the members of the managerial or the
other staff.
6.To stage demonstrations at the residences of the employers or the managerial staff members.
7. To incite or indulge in wilful damage to employer’s property connected with industry.
8.To indulge in the acts of force or violence or to hold out threats of intimidation against any
workman with a view to prevent him from attending work.

Punishment for committing unfair labour practice

According to Section 25U of the Industrial Disputes Act, 1947, any person who commits any unfair
labour practice will be punishable with imprisonment for a term which may extend to six months or
with fine which may extend to one thousand rupees or with both.

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Judicial framework: CASE LAWS
Case 1: H.D. Singh vs Reserve Bank Of India & Ors
Khalid – appellant being a Tikka Mazdoor while Reserve Bank of India was first respondent.
1) Appellant presented himself daily and was employed only for 4 days in 1974,154 days in
1975 and 105 days in 1976.
2) He was not told at the time when he accepted the job his name would be struck off from the
rolls if he passed matriculate examination. He pleaded mala fides. People who had
matriculated after selection had been retained in service and he was discriminated against.
3) The respondent contended that reference was bad since the dispute was not sponsored by any
representative trade union and the dispute was not an industrial dispute
4) The tribunal court held that action of RBI Kanpur in not giving regular appointment to
appellant is held to be legal and proper and his name could be stuck off from the list.
Appellant went against this award to Supreme Court.
5) Supreme Court held that striking off the name of a workman from rolls by the employer
amounts to “termination of service” and such termination is retrenchment with the meaning
of section 2(oo) and Section 25-F is applicable in this case law.
6) SC referred to contains a list of unfair labour practices as defined in Section 2(ra). Item 10
reads "To employ workmen as 'badlis', casuals or temporaries and to continue them as
such for years, with the object of depriving them of the status and privileges of
permanent workmen." We have no option but to observe that the bank, in this case, has
indulged in methods amounting to unfair labour practice.
7) SC set aside the order of Industrial Tribunal and hold that the striking off the name of the
appellant from list is retrenchment under section 2(oo) and is violation of section 25-F. The
respondent bank was direct to enlist appellant as regular employee and reinstate him and pay
him his back wages.

Case 2 : Eveready Flashlight Co. v/s Labour Court

1) The company appointed a workman on daily rate basis on 18th January, 1958 after trying-
him for four days. On April 12, he was appointed on probation for 6 months which could be
further extended by the company at its discretion.
2) He was elected a member of the working committee of the union on September 9. On 10th
September the management served him with a notice of warning that in spite of repeated
warnings he had shown no improvement in his work. The warning was repeated on 11th
October. On November 21, 1958 his service was terminated.
3) The Union raised an industrial dispute and the Labour Court found no justification for putting
the workman on probation after he had been tried and that the condition of putting him on
probation was just to delay making him a permanent employee. 
4) It was held that "a condition of employment which is designed to invest the employer with
arbitrary power to keep the workmen at his mercy as regards his chance of being made
permanent, and to eventually lead to deprive him of such chance would amount to unfair
labour practice".

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 5) It was further observed that it is not necessary that there must be numerous transactions
before the employer could be branded guilty of unfair labour practice and that he could be
held guilty of such practice in respect of one contract of employment only.
Case 3: TITAGHUR PAPER MILLS CO LTD v/s RAM NARESH KUMAR

1) The management dismissed a workman (who was the vice-president of the workmen’s union)
found guilty of gross negligence in the performance of his duties and disobedience of orders
after a regular enquiry. The dispute was referred to the tribunal for adjudication.
2) The tribunal found that the domestic enquiry conducted by the management was regular and
proper, and that the workman was guilty of misconduct punishable with dismissal.
3) However, it was of the view that the employer was bound to give to the workman a reminder
about his duties as was the usual practice, and that there was room for suspicion that the
employer wanted to get rid of him; because he was an eye-sore on account of his union
activities. Accordingly, the tribunal held that this was a case of victimization and ordered
reinstatement of the workman.
4) Supreme Court held that it is not covered by any of the four grounds laid down in Indian Iron
and Steel Company Ltd. vs Their Workmen (1958) on which a tribunal can interfere with the
order of dismissal by the management.
5) Dereliction of duty was clearly established, the management had the right of dismissal under
the relevant standing orders, proper enquiry was held and the explanation of the workman
was found to be childish.
6) It was not the duty of the management to remind the workman who was failing to perform his
duties properly, even if the management sometimes did so. Nor can this be said to be a case
of victimization, for the dereliction of duty was clearly established.

Case 4: STATE OF RAJASHTAN VS DEEPA RAM

1) The respondent Deepa Ram was engaged as labourer on daily wages by Merta City Sub
Division of the Government of Rajasthan.
2) He filed a writ petition .A learned single judged of the High Court held that the appellant
was motivated for discontinuing the engagement of the respondent as a daily wager with a
view to see that he did not complete the period of engagement of 240 days which have
resulted in conferring certain benefits under ID Act 1947 .
3) It was also observed that during this period such works were allocated to contractual
employers. The termination of employment of the respondent amounted to an unfair labour
practice.
4) The writ petition was allowed and the respondent was directed to be reinstated.
5) This is contained in a list of unfair labour practices as defined in Section 2(ra). Item 6 reads
“To abolish the work of a regular nature being done by workmen, and to give such
work to contractors"

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Case 5: Haryana State Electronics Development Corporation Ltd. v. Mamni
1) The respondent Mamni was appointed initially for a period of 89 days in the post of Junior
technician on ad hoc basis.
2) The post was temporary and her services were liable to be terminated without assigning any
reason or notice.
3) However, it was noticed that she used to be appointed after a gap of one or two days upon
competition of each term.
4) Such an action on part of appellant cannot be said to be Bonafede. This was found to be
infringing to the provisions of section 25-F of industrial dispute act.
5) The court held that the services of the respondent had been terminated on a regular basis and
she had been reappointed after a gap of one or two days.
6) Such a course of action was adopted by appellant with a view to defeat the object of the Act
Case 6 : Mrs. Chitra Srivastava vs Govt. Of Nct Of Delhi 
1) Petitioner Mrs Chitra Srivastava who is Hamdard Wakf Laboratories as Secretary to the
Head, Human Resource Development at the Head Office, had challenged in the writ petition
order transferring her to Bhopal. Petitioner, who was working at the Head Office in Delhi,
contended that her transfer hundreds of miles away, was a mala fide one. She was mother of
two children with a sick husband, who has undergone neurosurgery.
2) Petitioner contended that she was being made a scapegoat simply to show that the transfer of
Arifa Nauman was not a solitary case but a routine one by transferring her also.
3) It was urged that Mrs. Arifa Nauman was being victimized on account of trade union
activities of her husband, who was Secretary of Workers' Union of respondent. Petitioner in
the writ petition had questioned her transfer as a mala fide one and being contrary to the
standing orders.
4) Respondents had raised preliminary objection to the maintainability of the writ petition
contending that an alternative efficacious remedy under the Industrial Disputes Act was
available, which the petitioner had failed to avail.
5) Mr. Gupta, learned Counsel for the petitioner, had contended that the Tribunal did not have
any power to grant stay of the transfer order and the order affected her livelihood and
fundamental rights. 
6) Respondent on the other hand, had contended that the transfer was not emanating from any
malice, rather the respondent had only accommodated the petitioner by transferring her to
Aurangabad, since her job was rendered surplus otherwise and she was liable to be
retrenched.
7) The Bench reached the conclusion that transfer of a workman made mala fide under the guise
of following management policy is an unfair labour practice in respect of which an industrial
dispute could be raised.
8) Fifth Schedule of the Act specifies the various trade practices. S. No. 7 of the said Schedule
is as under: “To transfer a workman mala fide from one place to another under the
guise of following management policy”

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Discussion of Judicial Framework and Case Laws
The Supreme Court is the apex court in India who is responsible for maintaining industrial peace in
the establishment. Along with the various jurisdiction bodies such as High Court, Labour court and
Tribunal court, it has laid great emphasis on maintaining industrial peace by giving various
judgement. The cases are dealt on individual capacity and necessary references are taken for similar
judgments, whenever required.
Case 1: Supreme Court clearly recognised striking name of out roll is a case of retrenchment which
is an unfair trade practise. Supreme emphasised the workmen cannot be deprived of the status and
privileges of permanent workmen. The court ordered the necessary to put appellant as regular
employee and focussed on reinstatement of worker to his original working conditions and pay him
his back wages. This was done in view so as to ensure that the worker is duly compensated in
accordance with the provisions of Industrial Act 1947.
Case 2: If a workman cannot become permanent unless and until the employer issues a formal
order, the result would be that an employer could keep every employee as temporary. The finding of
the case is that the employer deprived the workmen of his permanent status. It is award is very fair
because it has directed the reinstatement of the workman it has not allowed him any wages for the
interim period when he did not work for the company. Therefore, the petition fails and is dismissed
with cost as it is in line with item 5a in the fifth schedule ID ACT 1947.
Case 3:The Supreme Court held that the scope of the power of an industrial tribunal to interfere in
the matter of dismissal of workmen by the management was considered by them in Indian Iron and
Steel Company, Ltd., VS their workmen [1958 - I L.L.J. 260].It was laid down that the powers of an
industrial tribunal in this matter were not unlimited and the tribunal did not act as a court of appeal
and substitute its own judgment for that of the management. All that the tribunal said was that there
was room for suspicion that the management wanted to get rid of employee. But considering the
nature of the dereliction of duty, it cannot possibly be said that the management had any hand in the
failure of the workman to perform his duty properly.
Case 4 and Case 5: Supreme Court emphatically stated that the various employers indulged in
suspending workers and hire contractual employees so to keep deprived its employers’ certain
benefit with regards to provision of ID Act. This is an unfair labour practise destroys the very
doctrine of ID Act. This practise might develop an unhealthy IR climate.
Case 6: Supreme Court held that transfer of workman under the guise of following management
policy is an unfair labour practise in respect of which an industrial dispute can be raised

Through the above case results it has clearly known that the Supreme Court always tries to achieve
the following through its various judgments on various cases laws:

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 1) Safeguard the interest of labour and management by securing highest level of mutual
understanding.
2) Avoid industrial conflict or strike by providing necessary judgement.
3) Improve the economic conditions of workers in the industrial establishments.
4) Reduction in number of strikes, lockouts and gheraos.
5) Providing reasonable wages, improved living and working conditions to the workers.

Conclusion
One of the principal objectives of ID act is to encourage collective bargaining. The provisions of ID
Act clearly believed in voluntary settlement and conciliation methodologies to settle an industrial
dispute. It aims to reduce the number of retrenchments, strike, lock-outs and layoffs which help in
creating healthy industrial relations.
For healthy IR, it is clearly stressed to maintain harmonious relationship between employee and
employers. It is the responsibility of either shareholders to ensure social justice to both employers
and employers.
As a student of Industrial Relations, we suggest following steps to improve Industrial relations
1) Both the employers and employees should develop constructive beliefs towards each other’s
2) All policies and procedure to be followed should be clear in the organization and especially
to the union leader.
3) Management should encourage right kind of union leadership.
4) The personnel manager should not vie with the union to gain workers ‘loyal to both the
organization.
5) The personnel manager should remove any distrust by convincing the union of the company’s
integrity and his own sincerity and honesty.
6) Promote a system of dialogue and communication in the establishment. Good communication
helps to avoid employee confusion and unnecessary stress.
7) Employers should provide healthy working conditions to its employees.
8) Focus on importance of employee recognition.

References:
1)https://indiankanoon.org/doc/1901476/#:~:text=The%20action%20of%20the%20Reserve%20Bank%20of
%20India%2C%20Kanpur%2C%20in,Reserve%20Bank%20of%20India%2C%20Kanpur.

2) https://www.casemine.com/judgement/in/5609ac1ae4b014971140e098

3) https://indiankanoon.org/doc/1219350/

4) https://www.casemine.com/judgement/in/56ea9114607dba382a079352
5) https://indiankanoon.org/doc/198666342/
6) https://indiankanoon.org/doc/1049779/
7) https://www.lawyerservices.in/Chitra-Srivastava-Versus-Govt-of-NCT-of-Delhi-and-Others-
2006-07-07

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8)https://www.advocatekhoj.com/library/bareacts/industrial/schedule5.php?Title=Industrial
%20Disputes%20Act,%201947&STitle=Unfair%20Labour%20Practices
9) https://encyclonetcultuland.blogspot.com/2017/02/causes-effects-of-poor-industrial.html

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