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Module - 3

Definition- Industrial Disputes Act 1947,sec 2 (k) Industrial dispute means any dispute or difference between – (essentials prerequisites for a dispute)

and employers Employers and workmen Workmen and workmen.

is connected with the employment / non employment of the terms of employment or with the conditions of the labor of any person but not supervisor or manager or Drawing wages 1600 /-pm or Relationship between employer & employee must exist.

As per section 2 (J) of industrial disputes act 1947, Industry mean any systematic activity carried on by cooperation between an employ and his work man for the production supply or distribution of goods and services with a view of satisfy human wants or needs.

Workman [(2) s]
All employees in an estt are not workmen under industrial dispute act.  Employees doing any manual , skilled , unskilled, technical, operational ,work in respective of their salary.  Sec 2 (s) of Act- “workmen means any person employed in an industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward. The terms of employment may be either express or implied. A workman has been dismissed, discharged or retrenchment comes within the definition of the term „workman‟ if there is any disputes relating to such dismissal, discharge or retrenchment.”

Who all don’t come under workman

 

Person subject to Army Act 1950 or Navy Act 1934 or Air Force Act 1950. Persons employed in police service. Employed for managerial or administrative capacity. Employed in supervisory capacity

through an external 2) To ameliorate the condition of workmen in industry by providing job security.Objective of the act 1)To secure industrial peace  a) by preventing and settling industrial disputes between the employers and workmen.  b) by securing harmony and good relations .through an internal works committee. 4) To Prevent illegal strikes & lockouts.  c) by promoting good relations. retrenchment etc . 3) To provide Suitable machinery for investigation and settlement of industrial dispute between 3 parties. 5) To provide relief to workmen – lay offs.

 Economic causes terms and conditions of employment Wages and other benefits C.  Lack of adequate maintenance   Poor relation with peers or superiors Demand for self respect. Organizational Causes    Non recognition of TU. lack of proper communication sys. worn out P& M. .Causes of Industrial Disputes A. Unfair practices B. technological issues. Physical causes poor working conditions  improper plant and workstations. Psychological causes  D. multiple TU. clash of personalities.

centre state relations. irrelevance of certain provisions Other causes . political instability.Causes of Industrial Disputes Industrial Factors Management‟s attitude Government machinery – labor laws implementation . .affiliation of TU.

some of the causes of dispute may be : (i) An industrial matter relating to employment. work. hours of work. change in the attitude of employers and rivalry among unions.(A)Industrial Factors : Under this category. settlement or award : and (c ) demarcation (establishing limits) of the functions of an employee (ii) An industrial matter in which both the parties are directly and substantially interested. inflation. privileges. wages. terms and conditions of employment including matters pertaining to : (a) dismissal or non-employment of any person (b) Registered agreement . the rights and obligations of employees and employers. (iii) disputes arising out of unemployment. .

(iii) unwillingness to negotiation and settlement of disputes.(II) Management Attitude Towards Labor : Management „s unwillingness to talk over any dispute with their employees. etc. delegating enough authority to the representatives. promotion etc without consulting the concerned employees (v) Managements unwillingness to provide services and benefits to its employee's (i) . (ii) Managements unwillingness to recognize a particular trade union . (iv) Managements insistence to take care of recruitments.

improper and inadequate implementation by many employers. (b) . incapability of understanding and answering imperatives of development. The governments conciliation machinery has settled a very negligible number of disputes . it is ineffective and unsatisfactory due to various reasons like their irrelevancy in the context of the challenges of present industrial climate /culture.(III) Government Machinery : (a) Though there are number of enactments for promotion of harmonious relations.

lockouts . easy money.state relations. etc can also result into industrial disputes. . centre.(IV) Other Causes : (i) (ii) (iii) Affiliation of the trade unions with a political party. sometimes result into industrial conflict. Political instability. gheraos etc. where the latter may initiate the trade unions to conduct strikes. Other potential factors like corruption in industry and public life.

Industrial Disputes Strikes Lockouts Primary Strikes Secondary Strikes Stayaway Strikes Sit down Stay-in Tool Down or Pen Down Strikes Go Slow Work To Rule Token or Protest Strikes Lighten ing or CatCall strikes Picket ing & Boyco tt Gher ao Hunger Strikes .

secondary strikes and other strikes.They are Primary strikes.Strikes :  Strikes are a result of more fundamental maladjustments. Strikes are divided into three types .   . injustices and economic disturbances. Strike is a temporary termination of work by a group of employees in order to express grievances or to enforce a demand concerning changes in work conditions.

demonstrations. Pen Down Strike : Here the strikers lay down their tools in case of factory workers . workmen come to the place . They are : (i) Stay Away Strikes: In this strike workmen stay away from the work place. office workers lay down their pens.I. . Primary strikes are generally against the employer with whom the dispute exists. (ii) Stay-in or sit Down Strikes : In this strike. (iii) Tools Down. etc. they stay at the work place but they don’t work. They organize rallies.

(vii) Work to rule : In this strike. (v) Lightening or Wild cat strike : In this strike. (viii) Picketing : It is an act of protesting by the workmen in front of the premises of the employer . the workers intentionally reduce the speed of work.(iv) Token or Protest Strikes : It is of very short duration and is in nature of signal for the danger ahead. (vi) Go –Slow : In this strike. the strike is done without any prior notice or with a shortest notice. the strikers undertake the work according to rules or job description. In this strike workers do not work for an hour or a day.

. workshop etc. (x) Gherao : It is a physical blockade of a target either by encirclement. intended to block from and to a particular office.(ix) Boycott: It aims at disrupting the normal functioning of the enterprise. (xi) Hunger Strike : This type of strike is resorted to either by the leaders of the union or by some workers all at a time for a limited period or up to the period of settlement of disputes.

and so may be used to refer to a dispute with the employer's parent company (holding company). These strikes are sympathetic strikes. contracting parties. its suppliers. Secondary action (also known as a secondary boycott or sympathy strike) is industrial action by a trade union in support of a strike initiated by workers in another. separate enterprise.II Secondary Strike : Secondary strikes are against a third party. The term "secondary action" is intended to be distinct from a trade dispute with a worker's direct employer. . or any other employer in another industry. financiers.

However. and prohibiting an employee are not lockouts. . or the refusal by the employer to continue to employ any number of persons employed by him. termination of employment or retrenchment.Lockouts: Lockout means the closing of a place of business of employment or the suspension of work.

PREVENTIVE MEASURES OF INDUSTRIAL DISPUTES Labor Welfare Officer Tripartite and Bipartite Bodies Standing Orders Grievance Procedure Collective Strong Bargaining Trade Unions Labor CoPartnership and Profit sharing Joint Consultations .

. 1948 specifies that: every factory wherein 500 or more workers are ordinarily employed at least one welfare Officer must be appointed.the assistant and / or additional welfare officers are required to be appointed to assist the Welfare Officer.1] Labor Welfare Officer : Section 49 (1) and (2) of the Factories Act. where the number of workers are in excess of 2500.

The functions of Labor Welfare Officer includes : (I) Labor Welfare Functions :Advice and assistance in implementing legislative and non-legislative provisions relating to : (a)Health &Safety (b)Sanitation & Cleanliness (c)Welfare Amenities (d) Housing (e)Implementation of welfare Acts. (f)Working conditions (g) Recreation (h) Workers Education (i) Formation of welfare committees .

(II) Labor Administration Functions :These may cover: (a)Organizational Discipline (b)Safety & Medical administration (c)Wage& salary administration (d)Administration of Legislation covering Industrial Relations (III) Labor Relations Functions: These may consist of : (a)Administration of standing orders. (b)Settlement of Grievances. (c)Settlement of Disputes through statutory procedures. . (d)Trade unions& union management relations (e)Steps to increase productivity efficiency.

e. employees and employer. the important bipartite body is works committees. •Bipartite consultative machinery comprises two parties i.2]Tripartite and Bipartite Bodies : •Industrial relations in India have been shaped largely by the policies and practices of Tripartite and Bipartite bodies. . •The purpose of consultative machinery is to bring the partners together for mutual settlement of differences in spirit of cooperation and goodwill.

The Standing Orders regulate the conditions of employment from the stage of entry to the stage of exit. 4] Grievance Procedure : 5] Collective Bargaining : 6] Strong Trade unions : 7] Labor Co-partnership and profit sharing : 8] Joint Consultation : .3] Standing Orders : It was made obligatory that standing orders should govern the conditions of employment under the Industrial Employment (Standing Orders ) Act of 1946.

 Fall in sales and fall in profits  In long run loss of goodwill   For Employees  Loss of income  Threat Loss of employment  Psychological and physical consequences of forced idleness. national income .Consequences of ID  For Employers  Decrease in output  Increase in cost of prod.  An adverse effect on the national productivity. For the Nation  Cause wastage of national resources.

Disputes of interest  Determination of new wage level and other employment conditions 2. Recognition dispute  Refuse to recognize TU. working time etc. 4. dismissal. 3.Types of Industrial Disputes 1. Disputes over unfair labour practices  Discrimination of mgmt against workers on the grounds of TU. . Disputes of rights  Grievance disputes – retrenchment.

Settlement of Disputes: .

Collective Bargaining Code of Discipline Dispute Settlement Arbitration Conciliation Grievance Procedure Standing Order Adjudication Consultative Machinery .

 It occurs when representatives of a labor union meet management representatives to determine employees wages and benefits.e. union ) acts as a bargaining agent for all the employees in carrying out negotiations and dealings with the management.  The bargaining is collective in the sense that the chosen representative of the employees (i. .Collective Bargaining:  It helps for settlement of issues and prevention of industrial disputes. to create or revise work rules and to resolve disputes or violations of the labor contract.

To ensure that employers and employees recognize each others rights and obligations.Code of Discipline : It defines duties and responsibilities of employers and workers. To maintain discipline in the industry. To promote consecutive co-operation between parties concerned at all levels. The objectives of the code are: 1. 2. 3. 5. To eliminate all forms of coercion (force). 6. . To facilitate the growth of trade unions. 4. To avoid work stoppages. pressure and violence in IR.

When the grievance redressal machinery works effectively. . arising out of employment relationship. believes or feels to be unfair. which enables the parties involved to attempt to resolve their differences in a peaceful and orderly manner. A grievance procedure is a formal process which is preliminary to arbitration. unjust or inequitable. it satisfactorily resolve most of the disputes between labor and management. which an employee thinks . Grievance is any discontent or dissatisfaction.Grievance Procedure : This is another method of resolving disputes.

NS.Not satisfied NS Voluntary Arbitration Committee of union & Management Representatives NS VI stage within7 days V stage Appeal to Management for revision IV stage communicates the decision within 7 days Manager NS Grievance Committee NS Departmental Representatives Head of the department III stage conveys verbally NS Department Representatives Supervisor NS Foreman II stage decision within 3days I stage answer to be given within 48 hrs Grievant Employee .

Arbitration is effective means of resolving disputes because it is : 1. gathers information and then makes recommendations that are binding on both the parties. Relatively expeditious when compared to courts and tribunals. Established by the parties themselves and the decision is acceptable to them. listens to both the parties. 2. .Arbitration : Arbitration is a procedure in which a neutral third party studies the bargaining situation.

to detect any biases. . it notifies the management. when the union decides. the time & place for hearing will be determined. 3) After the arbitrator is selected.Process of Arbitration : 1) The labor union generally takes initiative to go for arbitration. 4) Each side represents its case at the hearing. 5) Each party has to submit formal written statements. 2) The union & the management select the potential arbitrator by carefully studying the previous decisions given by the particular arbitrator.

transcripts & legal counsel may be used. 3) The decision given usually is a written opinion mentioning the reasons. 4) The report is submitted by the arbitrator to the appropriate government . 2) After hearing. cross-examination. the arbitrator studies the materials submitted and reaches the decision within 30 – 60 days.1) Witness .

The third party may be an individual or a group of people.Conciliation :  representatives of workers and employers are brought together before a third party with a view to persuading them to arrive at an agreement by mutual discussion between them. The third party may also be called as mediators. . The ID Act. 1947and other state enactments authorize the governments to appoint conciliators charged with duty of mediating in and promoting the settlement of industrial disputes.

the next stage may be compulsory adjudication or the parties may be left with their own choice . The parties may accept his recommendation or reject it. If the conciliation fails.In Conciliation . the ultimate decision rests with the parties themselves but the conciliator may offer a solution to the dispute acceptable to both the parties and serve as a channel communication .

Adjudication : Adjudication means a mandatory settlement of an industrial dispute by a labor court or a tribunal. But. This is the most significant instrument of resolving disputes. the verdict of a labor court or tribunal is binding on both the parties. It is obvious that once referred for adjudication .  The government has a discretionary powers to accept or reject recommendations of the conciliation officer. it has been criticized because of the delay involved in resolving conflicts. .

The bodies operating at state and national level. are tripartite in character .Consultative Machinery : set by the government to resolve conflicts.1956. industry . works committee are constituted as per the provisions of industrial Disputes Act. representing government. . The main function is to bring the parties together for mutual settlement of differences in the spirit of cooperation and goodwill. labor and management.  A consultative machinery operates at plant . Being bipartite in character. state and national levels. 1947 and joint management councils are set up following the trust laid down in the Industrial Policy Resolution.

When strikes are justified     Economic demands Unfair labour practices When no response from mgmt. Existing facility withdrawn – PF etc. .

Causes of strike .

It is counterpart of a strike.Laws relating to Lockouts   Section 2(1) of the Industrial Disputes Act. 1947 defines “Lock-out” as the closing of a place of business of employment or the suspension of work. . It is declared by employers to put pressure on their workers. or the refusal by an employer to continue to employ any number of persons employed by him.

and II ) 48 hours’ written notice of a strike is given to a. a council (if the dispute relates to a collective agreement to be concluded in a council). or b. Mediation and Arbitration (CCMA). to an employers’ organisation (if the employer is a member of an organisation that is a party to the dispute). if – 1) a dispute has been referred to a council or the Commission for Conciliation. to the workers (if they are not trade union members). the trade union.Every employer has the option to lock out workers. or c. 30 days have elapsed since the referral. or III) 48 hours’ written notice of a lockout is given to a. or c. a certificate that a dispute remains unresolved has been issued. or b. a council (if the dispute relates to a collective agreement to be concluded in a council) . the employer.

on the grounds that the workman has refrained from attending to work. Prohibiting an individual employee is not lockout.Following do not constitute a lockout    Termination of employment by retrenchment. . Declaration by employer .

It is temporary denial of employment. The employer employee relationship does not come to an end but is merely suspended during the period of layoff. But the employee is not terminated permanently and is expected to be called back in future. It may last for an indefinite period.Layoff Layoff implies temporary removal of an employee from the payroll of the organization due to circumstances beyond the control of the employer. . The purpose of layoff is to reduce the financial burden on the organization when the human resources cannot be utilized profitably.

flood. on account of shortage of coal. power or raw materials or accumulation of stocks or breakdown of machinery or by any other reason. . layoff is defined as “the failure. refusal or inability of an employer. In mines workers are laid off due to excess of inflammable gas. 1947. Layoff is restored in cyclical and seasonal industries. to give employment to a workman whose name appears on the muster rolls of his industrial establishment and who has not been retrenched”.Under Section 2(KKK) of the Industrial Disputes Act. fire and explosion.

According to Section 25(c) of the Industrial Disputes Act. the laid off workman must satisfy the following conditions: a) he should not be a badli or a casual worker. 1947. To claim this compensation. c) he must have completed not less than one year of continuous service. and d) he must present himself for work at the appointed time during normal working hours at least once a day. . a laid off worker is entitled to compensation equal to 50 per cent of the basic wages and dearness allowance that would have been payable to him had he not been laid off. b) his name must appear on the muster rolls of the industrial establishment.

. but shall cease to be regarded as such for the purposes of this section.Badli workman" means a workman who is employed in an industrial establishment in the place of another workman whose name is borne on the muster rolls of the establishment. if he has completed one year of continuous service in the establishment.

or retirement either voluntary or reaching age of superannuation. 1947 defines retrenchment as the “termination by the employer of the services of workman for any reason other than termination of services as punishment given by way of disciplinary action. or continued ill-health or the closure and winding up of a business”.Retrenchment Retrenchment means permanent termination of service of an employee for economic reasons in a going concern. The Industrial Disputes Act. .

Retrenchment however does not include the following:     Voluntary retirement of the workman Retirement of the workman on reaching the age of superannuation Termination in terms of non renewal of the contract Termination due to continued ill health .

3.The Act lays down the following conditions for retrenchment. Notice in the prescribed manner must be served on the appropriate Government authority. 4. 2. the worker employed last must be terminated first. In the absence of any agreement to the contrary.     1. The employee must be paid compensation equal to 15 days for every completed year of service.The employee must be given one month’s notice in writing indicating the reasons for retrenchment or wages in lieu of such notice. .

.(90/3) or  if the workman is entitled to weekly wages. then on the basis of wages of last twelve full working days. For this purpose. then on the basis of wages of last four completed weeks. or  if the workman is entitled to daily wages. then on the basis of the salary of last three calendar months. average pay will be calculated as under:  if the workman is entitled to monthly salary.

500. 000 + Conveyance Allowance – Rs 1. 000 + Canteen facility worth Rs 1. The total amount to be considered for retrenchment compensation is Rs 13. 922. 13. 500 + Washing Allowance – Rs 1. 80/- . 000 + Dearness Allowance – Rs 3. 86. 86. 922.23 (1 Day’ salary) 519. 80/Therefore the amount of retrenchment compensation to be payable to Mr ABC is Rs 1.Mr ABC has worked in an organization for 24 years. 5 months and his last drawn package is as under – Basic Wages – Rs 5. 000 + House Rent Allowance – Rs 1. 000 + Dress Allowance – Rs 1.23 X 24 years X 15 days = Rs 1. 500/ 26 days = 519. 000.

65. 35. X is an employee of Bajaj Auto.00. During his employment he was getting a monthly salary of Rs 45.000 . after serving 5 years 7 months. Due to his ill behavior. He received an amount of Rs 3.000 1.000 1.000 COMPUTATION Least of the following Amount actually received 15 days average pay* no.000 5. 00.Mr. he is retrenched from the services of the Co. 1.Maximum exemption limit ___________ Exempted amount Taxable amount is exempt: 3.of yrs served (45000*3/90)*6*15 3.

Authorities under this act        Works committee Conciliation officers Boards of conciliation Courts of inquiry Labor court Tribunals National tribunals .