DR.

RAM MANOHAR LOHIYA

NATIONAL LAW UNIVERSITY,LUCKNOW

2018-19

Final Draft

LABOUR LAW

DIFFICULTY IN CONCILIATION IN NON PUBLIC UTILITY SERVICE

Submitted to: Submitted by:

Dr. Prasenjit Kundu Deepak Kumar Rav

Assistant Professor (Law) Enrolment No. 160101059

Dr. RMLNLU, Lucknow. BA.LLB (Hons), VI

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Semester

ACKNOWLEDGEMENT

I express my gratitude and deep regards to my Assistant Professor, Dr. Prasenjit Kundu for
giving me such a challenging topic and also for her exemplary guidance, monitoring and constant
encouragement throughout the course of this thesis.

I also take this opportunity to express a deep sense of gratitude to my seniors in the college for their
cordial support, valuable information and guidance, which helped me in completing this task
through various stages.

I am obliged to the staff members of the Madhu Limaye Library, for the timely and valuable
information provided by them in their respective fields. I am grateful for their cooperation during
the period of my assignment.

Lastly, I thank almighty, my family and friends for their constant encouragement without which
this assignment would not have been possible.

Yours sincerely,
DEEPAK KUMAR RAV

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Introduction

Conciliation/ Mediation is said to be an ancient art of peace making. Being a human institution, it
is probably as old as man’s interest in the process of peaceful resolution of conflicts.

The statutory origin of Conciliation machinery as a method for resolving industrial disputes in
India is traceable to the Act of 1889. This was replaced by the Indian Trade Disputes Act of 1929
which contained provisions for the constitution of the ‘Board of Conciliation’. However, there
was no provision therein for appointing Conciliation Officers. The ‘Board of Conciliation’, under
*7Q the Act of 1929 proved to be highly inadequate. Consequently, in 1938, section 18-A was
inserted which authorized the Central and Provincial Governments to appoint Conciliation
Officers to act as ‘mediators’ in trade disputes. Meanwhile, availing of the discretionary power,
provided for the Provincial Government under section 18-A of the Act of 1929, the Bombay
Province enacted the Bombay Industrial Disputes Act, 1938 which provided for Compulsory
Conciliation for the first time. The application of this Act was restricted to major industries like,
the textiles, woolen, silk mills, transport, electricity and sugar. This Act later, in 1946, was
amended and was renamed as Bombay Industrial Relations Act The very next year, the
Government of India enacted the Industrial Disputes Act, 1947, wherein, Sections 6 and 18-A of
the repealed Act of 1929 were retained under Sections 4 and 5 providing for appointment of
‘Conciliation Officers’ and for the constitution of ‘Board of Conciliation’ by the Appropriate
Government.

Under the Act, the Conciliation Officers are “charged with the duty of mediating in and
promoting the settlement of industrial disputes”. Power to appoint the Conciliation Officers lies
with the Appropriate Government. The Appropriate Government through a notification in the
Official Gazette may, as it thinks fit, appoint such number of Conciliation Officers for a
specified area or for one or more specified industries, either permanently or for a limited period.
Further, the Act also empowers the Appropriate Government to constitute a ‘Board of
Conciliation.

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Section 2(e) defines ‘Conciliation proceedings’ to mean ‘any proceedings held by a Conciliation
Officer under this act’ there is no provision either in the Act or in the Rules providing for holding
any preliminary inquiry to enter upon the conciliation proceedings. If the parties attend any
proceedings held by a conciliation officer in compliance with notice served to the parties by him,
such proceeding must necessarily be conciliation proceedings.

Section 12 - Duties of Conciliation Officers

(1) Where any industrial dispute exists or is apprehended, the conciliation officer may, or where
the dispute relates to a public utility service and a notice under section 22 has been given, shall
hold conciliation proceedings in the prescribed manner.

(2) The conciliation officer shall, for the purpose of bringing about a settlement of the dispute
without delay investigate the dispute and all matters affecting the merits and the right settlement
thereof and may do all such things as he thinks fit for the purpose of inducing the parties to come to
fair and amicable settlement of the dispute.

(3) If a settlement of the dispute or of any of the matter in dispute is arrived at in the course of the
conciliation proceedings the conciliation officer shall send a report thereof to the appropriate Govt,
(or an officer authorized in this behalf by the appropriate Govt.) together with a memorandum of
the settlement signed by the parties to the dispute

(4) If no such settlement is arrived at, the conciliation officer shall, as soon as practicable after the
close of the investigation, send to the appropriate Govt, a full report setting forth the steps taken by
him for ascertaining the facts and circumstances, relating to the dispute and for bringing about a
settlement thereof, together with a full statement of such facts and circumstances, and the reasons
on account of which, in his opinion a settlement could not be arrived at.

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 (5) A report under this section shall be submitted within fourteen days of the commencement of
the conciliation proceedings or within such shorter period as may be fixed by the appropriate
Govt. [Provided that, (subject to the approval of the conciliation officer.) the time for the
submission of the report may be extended by such period as may be agreed upon in writing by
all the parties to the dispute.

Rule with regard to conciliation in Non-Public Utility Services. Rule 10 of Industrial Disputes
(Central) Rules, 1957 talks about it.

10. Conciliation proceedings in non-public utility service

Where the Conciliation Officer receives any information about an existing or apprehended
industrial dispute which does not relate to public utility service and he considers it necessary to
intervene in the dispute, he shall give formal intimation in writing to the parties concerned
declaring his intention to commence conciliation proceedings with effect from such date as may be
specified therein.

When conciliation is discretionary the conciliation officer may follow his own procedure according
to naure of dispute

This procedure may be divided into four main parts:

A. The Conciliator’s Preparations-

A conciliator will need to make two kinds of preparations: the general preparations
not related to any particular dispute and the specific preparations for a dispute in which he
is to intervene.

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 The preliminaries consist of: (a) Receiving an application for the intervention (b)
Preliminary contact with the parties (c) Giving information and obtaining information and
calling for remarks and counter remarks (d) establishing working relations with parties (e)
personal visits to the establishments involved in the disputes (f) convening the joint,
separate and (g) private meetings issuing the notice of conciliation.

B. The Preliminaries-
As per Rule 9(2) and 10, a conciliation officer is required to issue a formal
intimation to the parties declaring his intention to intervene in the dispute and commence
the conciliation proceedings on a specified date, time and place. But he can intervene only
in an industrial dispute [as defined by Section 2(k) of the Act], He is, therefore, required to
decide whether a dispute is an industrial dispute. The Act also requires a conciliation officer
to investigate the dispute and other related matters affecting the merits and right settlement
of the dispute without delay. All the proceedings conducted to meet such requirements and
before issuing the formal intimation to the parties declaring the commencement of the
conciliation proceedings constitute the preliminaries in the conciliation procedure.

C. Mediation Process-
The conciliation officers are charged with the duty of mediating in and promoting
the settlement of the industrial disputes. The mediation process begins after issuing the
notice conciliation, provided no understanding or arrangement is reached by the parties till
then regarding the settlement of the dispute. When the dispute is admitted in conciliation,
the conciliation officer is required to do all proper things for the purpose of inducing the
parties, through separate and/or joint meeting to arrive at an agreement. A few conciliation
officers try to induce the parties, generally in the termination of disputes, to arrive at
settlement. Usually they appeal to the management representatives, on behalf of the
workman, to be considerate and liberal towards the workmen. At times they bargain for a
reasonable amount of compensation to the dismissed workman. Some of them try to
enlighten the recalcitrant small employers about the consequences of the refusal to concede

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 the demand at the conciliation level.
The employer or his representatives will be told that the issue under the dispute is covered
by a particular labour law and it would be strictly enforced, and consequent upon which the
employer will be prosecuted for non-implementation of the provision(s). The employer will
also be told about the weakness of his side of the dispute and the advantage of a settlement
over the adjudication award. At times, the parties would be told about the long delays
involved in adjudication. If all such efforts bear fruits, the parties agree to sign a settlement
instead of insisting on a failure report.

D. Reporting-
The last part of the conciliation procedure is reporting. It is directly dependent upon
the outcome of the conciliation proceedings. Reporting is fairly simple when a settlement is
reached, whereas it is a lengthy and time consuming procedure when the disputes end in
failures. When the parties arrive at an agreement the conciliation Officer drafts the
settlement in prescribed form which is known as the memorandum of Settlement. The
representatives of both the parties sign the memorandum of settlement and the conciliation
officer counter-signs it while certifying that the settlement was signed in his presence. A
settlement is registered in prescribed form by the conciliation officer at his office. After
completing these steps the conciliation officer sends a copy of the settlement, with a
covering letter stating that the settlement between party X and party Y was arrived at on a
date, to the Govt, under a copy to the Commissioner of Labour. A conciliation officer also
send a copy of his reports to the Deputy labour Commissioner of the region if any. When no
settlement is reached, the conciliation officer is required to send a failure report under
Section 12(4) of the Act. This report gives, firstly, a complete account of the steps taken by
the conciliation officer for ascertaining the facts and circumstances of the dispute and for
bringing about settlement thereof; secondly, it is a full statement of such facts and
circumstances and reasons on account of which, in the opinion of the conciliation officer,
the settlement could not be arrived at. It may be inferred that according to section 12(4) of
the Act, the failure report is a single document.

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Procedure Before a Board of Conciliation

Procedure Before a Board of Conciliation Section 13 of the Industrial Dispute Act deals with the
procedure before Board of Conciliation. The procedure before a Board of Conciliation is not like
that before a conciliation officer, instead it is like the proceedings before a Court of Law.
Therefore, the proceedings before a Board of Conciliation are judicial in nature and are amenable
to a writ of certiorari. With regard to the reporting of the outcome of the conciliation proceedings,
the procedure before a conciliation officer and a Board, the commencement of the proceedings and
the actual nature of the proceedings are also different.

After a Board of Conciliation is constituted, the dispute is referred to it by the appropriate

Government. At its first sitting the chairman of the Board calls' upon the parties in such an order as
he thinks fit to state their case (Rule 21). The sitting of a Board is held at such time and place as its
chairman may fix. After so fixing the sittings of the Board the chairman informs the parties to the
dispute the time and place of the sittings (Rule 13). A Board meeting is held only if there is the
prescribed quorum, which depends upon the size of the Board (Rule 14). A Board may accept,
admit or call for evidence at any stage of the proceedings before it, in a manner it thinks fit (Rule
15). Or a member of a board may, for the purpose of inquiry into the dispute, after giving a
reasonable notice, enter the premises occupied by the employer concerned. The Board may issue
summons in Form D requiring any person to produce before it any books or papers or other
documents and things in the possession or under the control of such persons in any way relating to
the dispute. A Board may adjourn its sittings. In all these sittings in endeavours to bring about a
settlement of the dispute referred to it way of investigating the various matters connected with the
dispute and inducing the parties to come to a fair and amicable settlement. The proceedings before
Board are held in public except when the Board, at any stage, decides to examine a witness or to
hold the proceedings in camera.

Persons on whom Settlement is Binding

The Industrial Disputes Act, 1947 draws a distinction between a settlements arrived at by
agreement between the parties and a settlement arrived at in the course of conciliation proceedings.

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 Whereas the first category of settlement ‘shall be binding only on the parties to the agreement’ the
second one is binding not only on ‘all parties to the industrial dispute’ but also on : “(a) all other
parties summoned to appear in the proceeding as parties to the dispute; (b) where a party referred to
in clause (a) or clause (b) is an employer, his heirs, successor or assigns in respect of the
establishment to which the dispute relates: (c) where a party referred to in clause (a) or clause (b) is
composed of workmen, all persons who were employed in the establishment or part of the
establishment, as the case may be, to which the dispute relates on the date of and all persons who
subsequently become employed in that establishment or part”. It is evident from above that the
settlement arrived at in the conciliation proceedings shall be binding on four categories of persons
mentioned above. In extending the operation of such a settlement beyond the parties thereto,
section 18(3) of the Industrial Disputes Act makes a departure from the ordinary law of contract
and leads towards collective bargaining. The object of this section is to promote industrial peace
and harmony between the parties. It is with this object that wide extended coverage has been given
to section 18(3) and this can be done possibly when settlement would bind all the parties.

Difficulty in Conciliation in Non-Public Utility Services

Conciliation proceedings shall be deemed to have commenced, under the Act, on the date on
which a notice of strike or lockout under section 22 i.e., in case of public utility services,
is received by the Conciliation Officer or on the date on which the Appropriate
Government makes an order of reference of the dispute to the Board. In the absence of
any such notice, under section 22 of the Act, the Conciliation Officer may, by giving a
formal written intimation to the parties concerned declare his intention to commence the
proceedings on the date mentioned therein. The Conciliation Officer may take a similar
step when he receives information about an existing or apprehended dispute in a non-
public utility concern. That is, in case of non-public utility services and where a strike or
lockout notice has not been served by the trade union of a public utility concern, the
decision to commence conciliation proceedings shall be taken by the conciliation officer
himself who shall also decide about the date on which such proceedings would begin. In
case of non-public utility service it is upon discretion of the conciliation officer whether
he wants to take up the dispute for conciliation or not. It is not mandatory upon him to
take the case.
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And also sometimes what happens is that conciliation officer conciliates between the employer and
employees who are part of management backed union so there comes the difficulty as the issues of
the union who was in dispute is not really get addressed. The same thing happened in the case of
Britannia biscuit co. ltd vs Asst. Commissioner of Labour. The conciliation was between employer
and employee union of which no members were retrenched they were not related to the dispute.

Whether the Conciliation Officer’s decisions to initiate or not to initiate conciliation

proceedings under the Act would be amenable to the writ jurisdiction of the High Court under
Article 226 of the Constitution?
It was argued before the Division Bench of the Bombay High Court in East Asiatic and Allied
Company vs B.L. Shelke, that the decision taken by the Conciliation Officer not to initiate the
proceeding be quashed by issuing the writ of certiorari and further he should be directed to started
the conciliation proceedings. But the Court expressed the view that use of the word ‘may’ under
section 12 (1) makes it abundantly clear that the legislature has invested the Conciliation Officer
with the discretion whether to enter upon conciliation in respect of such disputes.
The Madras High Court in Workmen of V.M. Bus Service vs Labour Officer has ruled that since
sub-section (1) of section 12 of the Act confers discretion on the conciliation officer to decide
whether he shall conciliate or not, there is no room for the issuance of a writ of mandamus.

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CONCLUSION

Conciliation means a process whereby parties by mutual consent appoint conciliator or conciliation
officers to assist them in their attempt to reach an amicable settlement of their industrial dispute
arising out of a contractual relationship.
Section 4 of Industrial Disputes Act, 1947 authorizes the appropriate government to engage such
number of persons as may be deemed necessary by notification in the Official Gazette as
conciliation officers, for discharging the responsibility of mediating in and promoting the
settlement of industrial disputes.
Section 12 of Industrial Disputes Act, 1947 provides duties of conciliation officers.

The conciliation officers do not have the authority to impose upon the parties a solution of or to
dispute.

The Conciliation proceedings are concluded in the following manner:

 Where conciliation ended in settlement – the date on which settlement is signed by the
parties to the disputes or

 Where conciliation ended in failure, the date on which the appropriate Govt
receives the failure report of a conciliation officer. or

 When a reference is made to a Labour Court/Industrial Tribunal during the

pendency of conciliation proceedings.

In the case of non-settlement or failure of conciliation, copies of failure report under Section 12 (A) of
Industrial Disputes Act 1947 are required to be sent to the parties to the dispute

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.
SUGGESTION

There are various things which can be done to improve the mechanism of conciliation in India. A
serious thought should be given, without any further delay, for constituting an independent
Conciliation and Arbitration Service Agency as has been recommended by the National
Commission on Labour. Only an independent conciliation machinery can inspire confidence in the
parties.
Also an amendment should be brought to the current provision relating to conciliation proceeding
in non-public utility services making it mandatory for the conciliation officer to take up the dispute
whenever it is apprehended in non-public utility services.

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