An industrial dispute may be defined as a conflict or difference of opinion between management and workers on the terms of employment. It is a disagreement between an employer and employees' representative; usually a trade union, over pay and other working conditions and can result in industrial actions. When an industrial dispute occurs, both the parties, that is the management and the workmen, try to pressurize each other. The management may resort to lockouts while the workers may resort to strikes, picketing or gheraos.

Definition: As per Section 2(k) of Industrial Disputes Act,1947, an industrial dispute in defined as any dispute or difference between employers and employers, or between employers and workmen, or between workmen and which is connected with the employment or nonemployment or the terms of employment or with the conditions of labor, of any person.

This definition includes all the aspects of a dispute. It, not only includes the disagreement between employees and employers, but also emphasizes the difference of opinion between worker and worker. The disputes generally arise on account of poor wage structure or poor working conditions. This disagreement or difference could be on any matter concerning the workers individually or collectively. It must be connected with employment or nonemployment or with the conditions of labor. From the point of view of the employer, an industrial dispute resulting in stoppage of work means a stoppage of production. This results in increase in the average cost of production since fixed expenses continue to be incurred. It also leads to a fall in sales and the rate of turnover, leading to a fall in profits. The employer may also be liable to compensate his customers with whom he may have contracted for regular supply. Apart from the immediate economic effects, loss of prestige and credit, alienation of the labor force, and other non-economic, psychological and social consequences may also arise. Loss due to destruction of property, personal injury and physical intimidation or inconvenience also

arises. For the employee, an industrial dispute entails loss of income. The regular income by way of wages and allowance ceases, and great hardship may be caused to the worker and his family. Employees also suffer from personal injury if they indulge into strikes n picketing; and the psychological and physical consequences of forced idleness. The threat of loss of employment in case of failure to settle the dispute advantageously, or the threat of reprisal action by employers also exists.

Causes of Industrial Disputes: 1.Wages an Allowances 2.Retrenchment 3.Bonus 4.Leave/hours of work 5.Indiscipline and violence 6.Working conditions 7.Lack of proper communication channels 8.Trade union rivilary 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. 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% were caused by retrenchment. 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. Machinery for handling Industrial Disputes

Preventive Machinery (Voluntary)

Settlement Machinery (Statutory)

Workers participation in management

Collective bargaining

Grievance procedure

Tripartite bodies

Code of discipline


Court of enquiry

Voluntary arbitration


1)Preventive Machinery

a) Worker's participation in management WPM is the participation resulting from the practices which increase the scope for employees’ share of influence in decision-making at different tiers of organizational hierarchy with concomitant assumption of responsibility. Objectives: o An instrument for increasing the efficiency of enterprises and establishing harmonious relations; o A device for developing social education for promoting solidarity among workers and for tapping human talents; o A means for achieving industrial peace and harmony which leads to higher productivity and increased production; o A humanitarian act, elevating the status of a worker in the society; o An ideological way of developing self-management and promoting industrial democracy. o To improve the quality of working life (QWL) by allowing the workers greater influence and involvement in work and satisfaction obtained from work; and o To secure the mutual co-operation of employees and employers in achieving industrial peace; greater efficiency and productivity in the interest of the enterprise, the workers, the consumers and the nation. b) Collective bargaining Collective bargaining is process of joint decision making and basically represents a democratic way of life in industry. It is the process of negotiation between firm’s and workers’ representatives for the purpose of establishing mutually agreeable conditions of employment. It is a technique adopted by two parties to reach an understanding acceptable to both through the process of discussion and negotiation. c) Grievence Procedures Grievance procedure is a formal communication between an employee and the management designed for the settlement of a grievance. The grievance procedures differ from organization to organization. d) Impartite Bodies Certain bodies have been constituted to suggest ways and means to prevent disputes. The representatives of workers and employees are nominated by these bodies in consultation with Indian Organization of worker's. e) Code of Discipline These are a set of self imposed mutually agreed voluntary principles of discipline and good relations between management and worker's in the industry.

2) Settlement Machinery
a. Concilation Concilation is a method of resolving the industrial conflict with the help of third party who intervenes in the dispute situation, upon a request by either or both the parties. The Industrisl disputes act,1947 provides for concilation officers for the settlement of such disputes. b. Court of Enquiry In case of failure of concilation proceedings, the government can appoint a court of enquiry. After the enquiry, the court is required to submit its report within 6 months. c.Voluntary arbitration The parties must enter into a written agreement which must be signed by all the parties. On the failure of concilation proceedings, the concilation officer may persuade the parties to refer the dispute to a voluntary arbitrator. Voluntary arbitrtion means geeting the disputes settled through an individual person, chosen mutually by the parties. d. Adjudication Consists of settling disputes through an intervention by a third party appointed by the government, such as:
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Labour courts Industrial tribunals National tribunals

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