Introduction

Rapid industrialisation in India has led to growing concerns and issues. Inter-personal relationships between employer and employee has changed. Direct contact between the
employer and the employed has diminished. Dispute and differences of opinion between the two need investigation and settlement by a third independent agency. And here
government involvement is essential under the Industrial Disputes Act.

The Industrial Disputes Act, 1947 is Government's effort to regulate industrial relations in India. It seeks to ensure progress of industry through harmony and cordial
relations between employers and employees. The Supreme Court has stated the following as objectives for which the Act was constituted:

(i) Promotion of measures for securing and preserving amity and good relations between employers and
    employees;

(ii) Investigation and settlement of industrial disputes between (a) employers and employers;
    (b ) employers and employees; and (c) employees and employees;

(iii) Prevention of illegal strikes and lock-outs;

(iv) Payment of compensation to workmen in the event of Lay-off and Retrenchment; and

(v) Promotion of collective bargaining.

                                              Background

To regulate industrial relations, the Government has asked employers and workmen to observe some terms and conditions of employment and, for specified periods, to
maintain harmony between the employer and workmen and to prevent an industrial dispute. This ensures uninterrupted production and supply of services to society, and
thereby contribute to growth and development of the national economy.

For this, Government can prohibit strikes and lock-outs in the industry .It can direct maintenance of employment in essential services by demanding that workmen do not
leave their employment and that employers do not close their undertakings or suspend work.

                              To whom does this act apply?

The Industrial Disputes Act applies to all States of the Indian Union. All industrial and commercial establishments which employ workmen--technical or non-technical
including supervisors drawing wages and salaries up to Rs. 1600 per month have to comply with the Act. It does not apply to persons in managerial and administrative
positions, Army, Navy, Air Force, Police, Prisons and Civil Services of Government.

Implementation or the Act

The act is administered by the Central and State Governments. The Central Government handles disputes between employer and employees in mines, oil-fields, railways,
major ports, airlines and other industrial and financial institutions under the Central Government and other industrial disputes are handled by the State Governments in their
respective spheres.

What is an Industry?

An 'Industry' means any business, trade, undertaking manufacture or calling of employers and includes any service, employment, handicraft, or industrial occupation or
avocation of employees.

This definition has been given numerous interpretations from time to time. The term was comprehensively examined by the Supreme Court in the case of Bangalore Water
Supply and Sewerage Board vs. A. Rajappa with the following observations.

To be considered an Industry , and activity should satisfy the following:

(i) it should be a systematic activity;

(ii) it should be organised by cooperation between employer and employees; and

(iii it should be for the production and/or distribution of goods and services for the satisfaction of human ants and wishes which are not spiritual or religious by nature,  whether it is carried for profit or gain  or not.

The Supreme Court's decision has a wide sweep brining charitable or missionary institutions, hospitals, educational and other research institutions, municipal corporations,
firms of chartered accountants and solicitors, etc. under the cover of term 'Industry'.

In the light of the Supreme Court's decision in the Bangalore Water Supply and Sewerage Board's case, the definition of 'industry' was recast in the Industrial Disputes
(Amendment) Act, 1982 to give it a clearer meaning. It defined Industry as a "systematic activity carried on by cooperation between an employer and his workmen for the
production, supply and distribution of goods or service with or without profit." It included activities of the Dock Labour Board, professional practice by industry or groups,
sales and business promotion activities, and agricultural activity ancillary to industrial activity. It excluded hospitals, educational and research institutions and charitable
services. Although the amendment by 1982 Act has received Parliament and Presidential approval, the amended definition has not so far been enforced, due to opposition from
workers. As such, the definition of Industry as in the 1947 Act, still continues.

Other definitions

Industrial Dispute

It means any dispute or difference between employers and workmen, or between employers and employers or between workmen and workmen, which is connected with
employment or non-employment or terms of employment or with the conditions of labour of any person.

Lay-off

Lay-off means the failure, refusal or inability of an employer to give employment to a workman whose name appears on the rolls of his industrial establishment and who has
not been retrenched due to shortage of coal, power or raw material, accumulation of stocks, breakdown of machinery or natural calamity or any other connected reason.

The lay-off may be for half a day or a whole day. A workman laid off by the employer is entitled to lay-off compensation at the rate of half-day wages for a day's lay-off.

Retrenchment

It means termination by the employer of the service of a workman for reasons other than punishment or disciplinary action. Voluntary retirement, or retirement at the age of
superannuation or termination on the ground of continued ill health or non-renewal of contract of employment do not amount to retrenchment.

In the event of retrenchment, a workman among other things is entitled to retrenchment compensation at the rate of fifteen days wages for each completed year of service.

Lock-out

Lock-out means the temporary closing of a place of employment or the suspension of work or the refusal by an employer to continue to give work to people employed by
him.

Public utility services

Railways, postal, telegraph and telephone service, industry supplying power, light, or water to public, transport for the carriage of goods or passengers by air, any system of
public conservancy or sanitation, or any industry specified in the first schedule of the Act have been declared as a public utility service by government, for six months or less
at a time.

Strike

Strike means a stop to work by a body of persons in an industry , or a concerted refusal or a refusal under a common understanding, of any number of employed persons to
continue to work or accept employment.

Workman

Workman means any person (including an apprentice) employed in an industry to do manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or
reward, whether terms of employment are expressed or implied. It includes a person who has been dismissed, discharged or retrenched in a dispute or whose dismissal,
discharge or retrenchment has led to that dispute.

Who are the authorities and what are their duties under the Act?

The following have been provided as authorities for investigating, preventing and resolving industrial disputes under the Act:

(1) Works Committee;
(2) Conciliation Officer;.
(3) Board of Conciliation;
(4) Court of Inquiry;
(5) Labour Courts;
(6) Industrial Tribunals; and
(7) National Tribunals.

What is Works Committee and its role?

The Works Committee has to be set up by the employer in his industrial establishment if he employs 100 or more workmen. The Works Committee should have equal number
of representatives of the employer and workman.

The Committee's role is to promote, secure and preserve good relations between the employer and workmen. It will try to ensure that no difference of opinion develops
between employer and workmen on a matter of common concern.

What are the duties of a Conciliation Officer?

Conciliation Officers are appointed by the Central or State Government. One Conciliation Officer may be appointed for one particular area or more. The duty of the
Conciliation Officer is to create a congenial atmosphere in the industry so that the employer and workmen can reconcile their differences through persuasion and mediation of
the Conciliation Officer. The Officer promotes settlement between employer and workmen in any industrial dispute.

A Conciliation Officer is empowered to enter an establishment, after giving notice to the employer, to conduct enquiry into a dispute. He also has power to enforce attendance
before him of any person connected with the dispute and produce relevant records/documents. He is a public servant

In a public utility service, his basic duty is to ascertain the point of difference and induce the parties to reach a fair and amicable settlement. But he has no power to pronounce a
judgment. The Officer has to send his report and memorandum of settlement to Government, within 14 days from the date of start of conciliation proceedings. Even if the
settlement has not been arrived at, he has to send his report to Government giving details of steps taken by him and the reasons why the settlement was not reached. The time
to submit the report can be extended by written agreement between the parties with the approval of the Conciliation Officer. In case the officer says the settlement was
failed, Government can refer it to the Conciliation Board, Labour Court, Tribunal or National Tribunal. A settlement is binding for 6 months or as agreed unless revoked by
any party within 2 months notice.

What is a Board of Conciliation and its function?

A Board of settlement may be set up by government to settle industrial disputes. It may have a Chairman and two or four other members. While the Chairman is an
independent member, the members represent the employer and workmen in equal proportion.

A dispute is referred to the Board by Government. The Board's duty is to investigate the dispute and report to Government within two months. Time can be extended by
mutual agreement between parties. Government may also extend the time on its own but not beyond two months.

The Board's role is also persuasive--to induce the parties to come to a settlement and send the report and memorandum of settlement to Government. In case no settlement is
arrived at, even then the Board has to forward its report to the Government stating the steps taken and reasons why the settlement could not be reached. The Government may
consider the failure report and may later refer it to the Labour Court or Tribunal. In case of public utility services, it is necessary that Government inform the parties if it
decides not to refer the dispute to the Labour Court or Tribunal.

When will the Government constitute a Court of Inquiry and what are its functions?

As and when the need arises, Government can constitute a Court of Inquiry. This Court of Inquiry was to find out matters connected with or relevant to an industrial dispute.
It may have one or more members. If it has more than one member, one will be appointed as a Chairman. All members have to be independent persons.

A Court of Inquiry looks into only matters which are referred to it by Government and submits its report to the Government ordinarily within six months from the date of
reference.

How are Labour Courts constituted?

Central or the State Governments constitute one or more Iabour Court for deciding industrial disputes and discharging other functions assigned to it under the Act. The
following are necessary for appointment of a presiding officer of Labour Courts:
 
(i) he is' or has been a judge of a High Court, or

(ii) he has been a district or additional district judge for not less than three years; or

(iii) he has been a presiding officer of a State Labour Court for not less than five years (in the case of Central Labour Court).

A Labour Court may consist of one or more independent persons. If more than one person is appointed to the Labour Court, one is the Chairman.

A person who is not an independent person or has reached sixty five years cannot be appointed nor can he continue as presiding officer of the Labour Court.

What are the functions of the Labour Court?

Labour Courts are empowered to decide or adjudicate the industrial dispute relating to the matters specified in the second schedule to the Act, which are as under:

(1) Legality or propriety of employers' order issued under a standing order (Certified conditions of employment).

(2) Application and interpretation of a standing order.

(3) Discharge, dismissal, reinstatement of and grant of relief to a workman.

(4) Withdrawal of any concession or privilege which was being paid/given to workmen as a customary payment or privilege.

(5) Legality or illegality of a strike or a lock-out

(6) Any matter of the third schedule which applies to activities with less than 100 workmen or a matter not covered by the third schedule.

What is a Tribunal?

A Tribunal is appointed by the Government to decide an industrial dispute. It has one person who is or has been a High Court judge or a District or Additional District Judge,
with at least 3 years standing. The Government may appoint two more persons as assessors to advise the tribunal in its work. Tribunals have to function within limits
imposed by the law under which they have been created.

What is a National Tribunal?

A National Tribunal is constituted by the Central Government only to decide an industrial dispute of national importance or which affects the interest of establishments
situated in more than one State. It has only one person who is or has been a High Court judge.

How do Labour Court, Tribunal or National Tribunal decide an industrial dispute?

As in the case of the Conciliation Board or the Court of Inquiry, an industrial dispute is referred to the Labour Court, Industrial Tribunal or National Tribunal by
Government. The Tribunals are assisted in their work by two assessors appointed by Government. When the dispute relates a public utility service where a notice of strike or
lock-out has been served, it is compulsory for Government to refer the dispute for adjudication to these authorities. In other cases, the Government may refer the dispute
only when it is satisfied.

Decisions of the Labour Court, Tribunal or National Tribunal are binding on the parties to the dispute. The decisions become enforceable after 30 days of its publication in an
official gazette, and remains operative for one year or as reduced or extended by Government. However, the period of the operation of the decision can not be extended by the
Government for more than 3 years from the date of its first coming into force. Even after the expiry of extended periods, the decision remains operative unless it is annulled
by any party after. two months' notice. The Government may not implement a decision on the ground of social justice or national economic considerations.

Can the Industrial Dispute be resolved voluntarily by the parties?

Parties to a dispute, if they agree, may refer it for arbitration to any person acceptable to both of them. The decision of this arbitrator becomes binding on the parties after its
publication in an official gazette by the Government. If the parties do not agree to a single arbitrator, they can select their own arbitrator each and appoint an umpire whose
decision will prevail if the arbitrators are divided between themselves.

When does the Labour Court, Tribunal or National Tribunal grant appropriate relief?

During the course of proceedings, if the above staled authorities are satisfied that the dismissal or discharge of a workman was not justified, they may set aside the order of the
dismissal or discharge and direct reinstatement of a workman and grant relief as they consider appropriate.

If the employer files an appeal against the decision given in favour of the workman directing his reinstatement, the employer has to pay full wages drawn by the workman
last, during the pendency of appeal provided the workman is not employed elsewhere during this period.

Can an employer effect any change in the service condition or a workman any day he desires?

The Act under Section 9A states that no employer can change service conditions of a workman unless:

(i) he has given a notice regarding the proposed change to the workman; and

(ii) the notice is at least of 21 days.

No notice is required if the change is to be effected under an award or settlement; or if it relates to employees under Government rules and regulations.

What are those conditions of service which require notice for change under Section 9A?

Schedule IV to the Act specifies the matters which require service of notice under Section 9A. They include wages, its period and mode of payment; contribution to provident
fund, pension fund; compensatory and other allowances; hours of work and rest intervals; leave with wages and holidays; change in shift; classification of grades; withdrawal
of customary concession or privilege or change in usage; introduction of new or changes in existing service rules except those under the standing orders; rationalisation;
increase or reduction in the number of employees etc.

Employers also cannot bring any change in the service conditions of a workman to prejudice this if any dispute relating to him is pending before any of the authorities under the
Act.

In the case of a protected workman also, an employer cannot alter conditions of his service to prejudice him; or discharge or punish him during the pendency of any industrial
dispute, without permission of the competent authority. A protected workman means a workman who is member of the executive committee or other office bearer of a
registered trade union.

When does a strike or lock-out become illegal?

There are several provisions in the Act according to which a strike or a lock-out is illegal in public utility and non-public utility services.

Illegality of strike and lock-out in Public Utility Services

A strike or lock-out is illegal in a public utility service if it has begun:

(i) without notice to the employer or workman, as the case may be, within six weeks before striking; or

(ii) within 14 days of giving notice; or

(iii) before the expiry of the date of strike; or

(iv) during the pendency of conciliation proceedings and seven days after the conclusion of such  proceedings.

Illegality of strike and lock-out in general sources i.e. those other than public utility services

A strike or lock-out in non-public utility service is illegal if it is commenced:

(i) during the pendency of conciliation proceedings and seven days after the conclusion of such proceedings; or

(ii) during the pendency of proceedings before a Labour Court, Tribunal or National Tribunal or arbitrator and two months after the conclusion of such proceedings; or

(iii) during the period of operation of a settlement of award.

A workman guilty of participating in an illegal strike can be jailed up to one month and tined up to Rs. 50 or both. Penalty for an illegal lock-out was the same jail terms of
one month but the tine can go up to Rs. 1000 or both on an employer. Penalty for instigation to go on illegal strike or declare illegal lock-out and for giving financial aid to
them is punishable by imprisonment up to six months or fine up to Rs one thousand or both.

What compensation is payable to a workman when he is laid off?

Lay-off compensation is payable to a workman for the days lay-off except weekly holidays at the rate of 50 per cent of this  basic and dearness pay. Such compensation is
payable for a maximum 45 days during a year. The workman can also retrenched after the 45 days.

Lay-off compensation is payable by employers in industrial establishments which are not seasonal or do not work intermittently and employ 50 or more workmen. Only
workmen who are on the rolls of the industry are entitled to compensation. He will not be a casual or badli (substituted) worker; he has to have completed one year' s
continuous service viz. he has worked not less than 240 days in a calendar year while employed over the ground and 190 days if employed below the ground. To calculate one
year's continuous service the period of previous lay- off, period of annual leave with wages availed of by him, the period of his being away from work due to employment
injury or the period of maternity leave not exceeding 12 weeks is treated as period of duty.

Under what circumstances is a workman not entitled to lay- off compensation?

A workman is not entitled to lay-off compensation if he:

(i) refuses to accept alternative employment offered by an employer in the same or another establishment within five miles from the establishment to which he belonged  provided that  employment does not require any special skill;

(ii) does not present himself for work at the establishment at the appointed time once every day during working hours; and

(iii) the lay-off has arisen due to strike or go-slow on the part of the workman.

Note: In an establishment employing 300 or more workmen, a workman cannot be laid off by the employer unless permitted by the Government, and unless it is due to
natural calamity or shortage of power. The Government has to reply to the employer within two months of his applying for permission as after expiry of this period the
permission will be deemed to have been obtained.

What is the procedure for retrenchment of a workman?

A workman who has completed one year's continuous service can be retrenched by an employer only if:

(I) The workman has been given one month's notice or one month's wages in lieu of notice;

(2) He has been paid compensation at the rate of 15 days wages for each completed year of service.  A period exceeding six months will be counted as one year; and

(3) Notice has been given to the Government, by the employer, as specified by the concerned  Government.

Note: Industrial establishments employing 300 or more workmen cannot retrench a workman unless they have given 3 months notice in writing or wages in lieu and have
obtained prior permission of the Government. The Government should reply to such notice within 3 months from the date of service of the notice otherwise the permission to
retrench the workman is taken as obtained by the employer.

Retrenchment of workmen due to closure or transfer of ownership of establishment also entitles them to retrenchment compensation. However, if the closure was
necessitated by circumstances beyond employer's control, the compensation does not exceed 3 months wages. Financial or commercial limitations do not amount to situations
beyond control. A 60-day notice has to be given stating the reason for closure of an undertaking.

Can an employer retrench any workman as he desires?

No, an employer is required to follow the prescribed procedure to a workman. Retrenchment is to be made on the last come first go basis. The workman to be retrenched first,
is the person appointed as the last workman prior to retrenchment. When employment has to be offered the first offer has to be the person who was retrenched first.
Retrenched workmen and their union have to be informed by the employer by registered post regarding the offer of re-employment.

What are Unfair Labour Practices?

Unfair Labour Practices have been specified in the 5th schedule to the Industrial Disputes Act The Act stipulates that no employer, workman, trade union whether registered
under the Trade Unions Act, 1926 or not, can commit any unfair labour practice. In case a person is found guilty of unfair practice, he can be punished with imprisonment up to
6 months or with fine up to Rs.1000 or both.

Un fair Labour Practices (ULP) has been divided into two parts as under:

1. ULP on the part of employers and their trade unions                         :         Annexure
2. ULP on the part of workmen and  their trade unions                          :         Miscellaneous

How is a Domestic enquiry conduced?

According to the principle of natural justice, the workman mst be given proper opportunity to defend himself. To hold a Domestic Enquiry it is essential that the employer
follow these procedures:

(1) the employer should appoint an Enquiry Officer who should be an unbiased person. He should not be an interested party in the dispute nor should he bring extraneous issues in the matter.

(2) the Enquiry Office should be an honest person and should hold the enquiry honestly. He should not only impart justice but must also appear to be so.

(3) The enquiry should be held in proper manner and not appear a formality.

(4) Charges levelled against the workman should be communicated to him in a charge sheet.

(5) Witness/Evidences should be examined in his presence. He should be able to cross examine the witness.

(6) The employee should be given all opportunity to defend himself.

(7) If the employee does not cooperate, the Enquiry Office can proceed with the enquiry without his participation.

(8) If there are criminal proceedings like for theft, assault against him in a Court, the Enquiry Officer need not wail for their disposal unless they are of serious import.

(9) Enquiry should be conducted as certified under the Standing Orders. If no procedure is prescribed, a notice should be given to the employee to prepare himself for defence.

(10) The employee CM be permitted to engage a co-employee to assist him in the enquiry .

(11) The proceedings of the enquiry should be recorded by the Enquiry Officer and should be signed  by the parties on its being adjourned.

(12) Enquiry should be held, conducted or adjourned as decided by the Enquiry Officer. But there should be due flexibility in all respects in the course of enquiry.

 13) Enquiry Officer should prepare his report and record his conclusion clearly, unambiguously and precisely.

(14) Enquiry Officer should submit his report to the employer for further necessary action in accordance with the report.

Is a workman entitled to recover the amount due to him from the employer?

A workman whose money is due from the employer can himself or through any other authorised representative (in writing) recover the due money from the employer. If the
employer fails to pay the money, the State Government should issue a certificate on whose basis the collector will recover the money as arrears of land revenue. Application
for recovery of money should be made within one year from the date of its becoming due. This period can be relaxed by the Government. Money due to a deceased worker can be
recovered by his Iegal heir.