Industrial Disputes Act, 1947

The Industrial Disputes Act, 1947 regulates Indian labour law so far as that concerns
trade unions as well as individual workmen employed in any industry in the Indian
mainland.
The Industrial Dispute Act was one of the last legislative acts before the passing of
the Indian Independence Act of 1947.It came into force on 1 April 1947.
The capitalists or the employer and the workers always had a difference of opinion
and thus, it leads to lots of conflicts among and within both of these groups. So,
these issues were brought to the attention of the government and so they decided to
pass this Act.
This Act was formed with the main objective of bringing peace and harmony to
industrial disputes between parties and solving their issues in a peaceful manner.

Definition of the Industrial Disputes Act

Industrial Dispute is “any dispute of difference between employers and employers or
between employers and workmen; or between workmen and workmen, which is
connected with the employment or non-employment or the terms of employment or with
the conditions of labour of any person.”
Industrial dispute as defined under Sec. 2(k) exists between-
Parties to the dispute who may be
Employers and workmen
Employers and Employers
Workmen and workmen
a) There should be a factum of dispute not merely a difference of opinion.
b) It has to be espoused by the union in writing at the commencement of the dispute.
Subsequent espousal will render the reference invalid. Therefore date when the dispute
was espoused is very important.
c) It affects the interests of not merely an individual workman but several workmen as a
class who are working in an industrial establishment.
d) The dispute may be in relation to any workman or workmen or any other person in
whom they are interested as a body.

Objectives of the Industrial Disputes Act

The key objectives of the Industrial Disputes Act, 1947, include:

1. Promotion of Industrial Peace: The Act seeks to foster a harmonious relationship

between employers and employees by preventing and settling industrial disputes
through peaceful means, such as negotiation, conciliation, and arbitration.
2. Prevention of Unfair Practices: It prohibits unfair labor practices by both employers
and employees, promoting fair employment conditions and preventing actions that
could lead to disputes or conflicts.

3. Resolution of Disputes: The Act establishes mechanisms for the resolution of

disputes, including conciliation boards, labor courts, and industrial tribunals. These
bodies play a crucial role in settling disputes through adjudication and providing fair
and just decisions.

4. Ensuring Justice and Fair Treatment: The Act aims to ensure justice and fair
treatment for both employers and employees by providing a legal framework for the
settlement of disputes. It includes provisions related to reinstatement of employees,
compensation for unfair dismissal, and other protective measures.

5. Regulation of Layoffs and Retrenchments: The Act regulates the conditions under
which employees can be laid off or retrenched, ensuring that such actions are carried
out fairly and without exploitation.

6. Providing Compensation: In cases of retrenchment, closure, or other adverse

actions affecting workers, the Act provides for the payment of compensation to
affected employees to mitigate the financial impact of such decisions.

7. Promotion of Collective Bargaining: The Act encourages the practice of collective

bargaining between employers and employees. It recognizes the role of trade unions
in representing the interests of workers during negotiations with employers.

8. Regulation of Strikes and Lockouts: The Act lays down rules and procedures
regarding strikes and lockouts to ensure that these industrial actions are carried out
legally and with proper notice. It also prohibits certain categories of employees from
striking.

Authorities Under The Act And Their Duties

The Industrial Dispute Act, 1947 makes provision for the investigation and settlement
of disputes that may hamper the peace of the industry. It ensures harmony and
cordial relationship between the employers and employees.

It also provides statutory norms besides helping in the maintaining of cordial relation
among the employers and employees reflecting socio-economic justice.

The act provides for the following authorities for Investigation and Settlement of
industrial disputes:

(i) Works Committee

 (ii) Conciliation officer

(iii) Boards of Conciliation

(iv) Court of Inquiry

(v) Labour Court

(vi) Labour Tribunals

(vii) National Tribunals

Provisions of the Industrial Disputes Act, 1947

The Industrial Disputes Act, 1947, in India, outlines provisions for the regulation of
industrial relations and the resolution of disputes between employers and
employees. Key provisions of the Act include:

1. Definition of Industrial Dispute: The Act defines an industrial dispute as a

disagreement or difference between employers and employees, or between
employers and workmen, or between workmen and workmen, which is connected
with employment or non-employment or terms of employment.

2. Authorities for Dispute Resolution: The Act establishes authorities such as

conciliation officers, boards of conciliation, courts of inquiry, labor courts, and
industrial tribunals to facilitate the resolution of industrial disputes through
conciliation, arbitration, or adjudication.

3. Prohibition of Strikes and Lockouts during Pendency of Proceedings: During

the pendency of conciliation proceedings or when an industrial dispute is referred for
adjudication, the Act prohibits strikes by workmen and lockouts by employers.

4. Compulsory Prior Notice of Changes: Employers are required to give notice to

appropriate authorities before effecting changes in employment conditions, such as
layoffs, closures, or retrenchments.

5. Settlements and Awards: The Act allows for the making of settlements between
employers and employees, and it empowers authorities such as labour courts and
industrial tribunals to issue awards to resolve industrial disputes.

6. Provisions for Retention of Employment: The Act includes provisions for the
retention of employment when ownership or management of an industrial
establishment changes.

7. Maintenance of Records: Employers are required to maintain records and submit

returns related to the employment of workmen, and provisions are made for the
inspection of these records.
8. Legal Immunity for Workers: The Act provides legal immunity to workers
participating in a strike if the strike is in compliance with the Act's provisions.

The Industrial Disputes Act, 1947, aims to create a framework for the fair resolution
of industrial disputes and to promote harmonious industrial relations by providing
legal mechanisms for negotiation, conciliation, and adjudication.

Important Case laws

1. Bharat Bank Ltd. v. Employees of Bharat Bank Ltd. (1950): This case established
the principle that the term "industry" under the Industrial Disputes Act is to be
interpreted broadly, including not only manufacturing units but also service-oriented
establishments.

2. Indian Overseas Bank v. I.O.B. Staff Canteen Workers' Union (1960): The
Supreme Court held that disputes arising out of activities connected with or
incidental to the main business of the establishment are considered industrial
disputes, emphasizing a broad interpretation of the term.

3. Management of Express Newspapers Ltd. v. Workers of Express Newspapers

Ltd. (AIR 1962 SC 1310): The court held that a lockout declared to break a strike is
illegal if the employer has not taken all reasonable steps to settle the dispute
amicably through conciliation.

When an Individual Dispute Becomes An Industrial Dispute?

Before insertion of Section 2-A of the Act an individual dispute could not per se be an
industrial dispute, but it could become one if taken up by the Trade Union or a number of
workmen.

The Supreme Court and majority of Industrial Tribunals held that, a dispute raised by a
dismissed employee would not be treated as an industrial dispute, unless it is supported by a
trade union or by a body or the section of workman.

For an individual dispute to be declared as an Industrial Dispute, the following conditions are
to be satisfied:

1. A body of workmen (trade Union ) or a considerable number of workmen, are found to

have made common cause with the individual workman;

2. That the dispute (individual dispute) was taken up or sponsored by the workmen as a
body (trade union) or by a considerable Section of them before the date of reference.