Members, Office Bearers and Outsiders in TUs

Funds, Members, Office Bearers and Outsiders in TUs & their Rights

Prof. K.R. Shyam Sundar

XLRI

Subscriptions

s. 6 (ee) of Rules specifies the minimum subscription by members:

one rupee per annum for rural workers;

three rupees for workers in the other unorganized workers

12 rupees for workers in other cases

Problems:

minimum is too minimum?

Poor finance?

Collection mechanism?

Subscription = membership = entitlements (privileges)

Who should prescribe subscriptions organization or the government?

TU security v. Avoidance

Closed shop = pre-entry requirement of a UM

Union Shop = post-entry requirement of a UM

Agency Shop

For: Effective check to free-riding and financial strength provision/stronger B.P. for recognized trade unions

Against: infringes on the freedom of choice of worker to belong to a TU or not; right of employment is conflicted

The TU may not be democratic

FNCL was not favourable to both closed and open shop or union shop as there is in-built compulsion

Check-off

SBI case:

http://www.livemint.com/Companies/JpVRVcWYPg6HM8D0fMJP7J/SBI-makes-Uturn-goes-soft-on-trade-unions.html

Union avoidance strategy to alter employee perceptions, beliefs, actions, and intentions.

These are via persuasion, coercion, or manipulation.

Discretionary actions against union supporters

Eliminate all sources of agitation

Strategic hiring flexible labour

Check-off

TU Act does not provide for check-off facilities in India, but in vogue in the UK & the USA (via CBA)

Should the check-off facility be given only to recognised TUS?

Should the check-off facility be granted to the recognised TU for deduction of settlement proceeds/arrears of all workers?

LEGAL BASIS:

PWA s. 7(2)(kkk) permits deduction of subscriptions from willing members of TU and employer is BOUND to deduct and remit the same into the a/c of the TU concerned deductions made with the written authorization of the employed person, for payment of fees payable by him for membership of any TU regd under the TU Act, 1926 (kkk)

Check-off Facility

Balmer Lawrie Workers Union v. Balmer Lawrie & Co. Ltd (1985, Lab IC 242), the SC observed that: check-off system authorizing deduction of UM deductions as part of the settlement between the union and the employer cannot be said to discriminate against another union

Check off facility can be extended to non-recognized unions also (State Bank Staff Union v. SBI, 1991 Lab IC 197), see also: Coimbatore Periyar District Dravida Panjalai Thozhilalar Sangham v. NTC, 2011, 4 LLJ, 857

S. 15 - Rules regarding the Spending of General Funds

The GF of a registered TU SHALL NOT be spent on any other objects than the following:

salaries, allowances & expenses to office-bearers

Expenses for admn of the TU incl audit of a/c of GF

prosecution or defence of any legal proceeding to which TU is a party which is for purpose of securing or protecting any rights of TU as such or any rights arising out of employment relations

Conduct of trade disputes on behalf of TU or any member thereof

Compensation of members for loss arising out of trade disputes

(f) Allowances to members or their dependents on a/c of death, old age, sickness, accidents or unemployment of such members (refer Bokajan case)

the issue of or the undertaking of liability under, policies of assurance on the lives of members or under policies insuring members against sickness, accident or unemployment

the provision of educational, social or religious benefits for members or for the dependents of members

expenses of funeral or religious ceremonies for deceased members

the upkeep of a periodical published mainly for the purpose of discussing ?s affecting employers or workmen as such

payment from contributions to any cause that benefits workmen in general provided that such expenses in respect of such contributions SHALL not be in excess of 1/4th of combined total of gross income accrued up to that time to GF

Any other object to be notified by the appropriate govt. in the official gazette

Political Funds

A regd TU may constitute a separate fund from CONTRIBUTIONS for or made, to a fund for promotion of CIVIL & POLITICAL INTERESTS OF ITS MEMBERS to promote the following objects:

payment of expenses incurred directly or indirectly by candidate for election for a legislative body

holding of any meeting or distribution of literature or documents in support of a candidate

The maintenance of any person who is a member of any legislative body ????

the registration of electors or the selection of a candidate for any legislative body

holding of political meetings of any kind/distribution of political literature/document

NO COMPULSION BY A MEMBER & NON-CONTRIBUTION SHOULD NOT MEAN EXCLUSION FROM AANY BENEFITS OF TU/or no disadvantage for those members

GENERAL FUNDS CANNOT BE USED FOR POLITICAL PURPOSES

Improper influence; growth of puppet legislators/affects freedom of speech of legislators/corruption of parliamentary system/new line of lobbying emerges

10

Members, Office Bearers and Outsiders in TUs & their Rights

Rights of Minors in TUs?

S. 21 - any person who has attained the age of 15 years may be a member of a regd. TU subject to any Rules of the TU

They enjoy all the rights of a member (immunity, etc.) +

The accounts books of a regd. TU and its membership list can be inspected by office bearers and members as prescribed by the Rules of the TU (s. 20)

unless 18, a person cannot become an office-bearer of a TU

1964 Amendment

Till 1964 the TU leaders with criminal record were not debarred and they represented workers in several laws, viz. PWA, ECA

To stop this abuse the 1964 amendment was brought in to disqualify any person convicted of moral turpitude from becoming or continuing as a member of EC or as office-bearer of regd TU unless 5 years have elapsed since his release

Disqualifications of office-bearers

Conditions for disqualification:

convicted for any offence involving moral turpitude & sentenced to imprisonment and after 5 years since release

not a minor (18+)

The Registrar has decide the ? of legality and validity of office-bearers to enter their names BUT THE SCOPE OF ENQUIRY IS LIMITED ( R. Murugesan v. Union Territory of Pondicherry, 1976, 2 LLJ 435)

This is necessary for admn of the act (Sanjeeva Reddi v. Registrar of T, 1969, 1 LLJ 11)

Meaning of Moral Turpitude

Turpitude very immoral behaviour (Oxford Advanced Learners Dictionary)

M.T. can hardly be defined but there exists some understanding of it

Though not defined it means anything done contrary to justice, honesty, modesty or good morals. It implies depravity and weakness of character and disposition

Outsiders in the TU EC

S. 22: one-third of the total office bearers or five, whichever is less shall be outsider persons

No member of the Council of Ministers/office of profit shall be member of the EC

ALL members of EC tenure = 3 years (S.6 (hh)]

http://www.thehindu.com/todays-paper/tp-opinion/office-of-profit-and-disqualification/article3147008.ece (for office of profit, etc.)

Why Outsiders (Pros/Cons)

FNCL NO BAR; SNCL NEEDS A BAR; 1978 LAW NOT > 4

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Why Outsiders?

Difficulties in emergence of strong internal leadership as work exhausting

Complex legal framework

negotiational skills lacking

Politics cannot be kept away from TUs in a democracy

ILO convention right to choose their own leadership

Total effect of them is not as bad as to effect a ban on their role (FNCL)

?s

Concept of an outsider?

Political leaders? Lawyers? Missionaries? Professors?

Complete ban on non-employees?

Curtailment of % of outsiders?

How many unions can the outsider hold positions? FNCL No ceiling; some legislative efforts limited it to 4; SNCL recommended the need for a ceiling

Strategy To Deal with OUTSIDERS

Make outsiders redundant by forces within rather than a legal ban

Intensify workers education

Capacity building

Limit the % of outsiders

Treat all-ex-employees as insiders

Create a convention that no TU office-bearer will concurrently hold office in a political party

Strategy

Total Ban

Partial Exclusion

Nurture Insiders

FNCL not favourable

Union Work during Office hours - Extended Rights do not become Legal Rights

Secretary of TNEB Accounts Subordinate Union v. TNEB, 1984, 2 LLJ, 478

Initially 2 workers allowed to do TU work during office hours

after 4 years the mgt refused this facility

dispute referred for adjudication

LC termed it as managerial concession & not a part of the service condition

HC it is not a legal right and withdrawal of any concession does not change the service conditions (see also Indian Bank Employees Union v. Indian Bank, 1994, 2 LLJ 497)

No immunity to office-bearers from punishment for remaining absent from their duty

Contd.

Even if the concession has been granted, it cannot be converted into matter of right

In case there is a settlement to the effect, then it is permissible

Union meetings cannot be held at the premises of the employer and even in other properties (say a Maidan)

If done despite prohibition, it will be deemed to be a subversive of discipline (Railway Board, New Delhi v. Niranjan Singh, AIR, 1969, SC 966; BEST Workers Union v. General Manager, BEST Undertaking, 1953, ICR 257)

The recognised trade union under MRTU (PULP) ACT enjoys the privilege of collecting union subscription in the premises (ILC 1958 also recommended the same)

21

?????

Whether the TU members/leaders have the right to attend CON/ADJ meetings on special leave with pay?

Whether the TU members/leaders have the right to attend various meetings on special leave with pay?

Whether the TU members/leaders have the right to attend various meetings on special leave with pay?

Workers in the company have allowed workmen to attend conciliation meetings this is ok as this will expedite settlement

But allowing workmen to avail S.L. raises some issues:

Adverse effects on production

How many times to allow, how many workers, if there are multiple unions, then how many unions, etc. indefinite extensions

The court asked as to why the meetings of trade unions be planned outside the working hours of the estb?

It was answered that it would not be always possible as there would be emergencies

But emergencies do not occur frequently

In the case of emergency meetings, the representatives can sacrifice one of their earned leaveThe meetings of the federation and the annual conventions of the INTUC too can be attended by the unions delegates by availing themselves of their earn leave

Indian Oxygen Ltd. v. their Workmen, SC, 1969, 1 LLJ

Transfer of Office-bearers

The power of the employer to transfer its employees (incl office-bearers) relates to general conditions of service and such transfers are effected for admin convenience; the court does not sit in appeal nor calls for details of admn exigencies

The employee under transfer cannot claim any immunity from transfer merely by reason of his being office-bearer of the trade union

The fact that the office-bearer organized protests. Etc. is not a ground from which intention to victimize the leader can be inferred

Only in cases where the transfer order is found to be mala fide or colourable exercise of power, would it become illegal

Transferring an employee because he is troublesome/troublemaker would be in the interest of admn and such transfers cannot be characterized as punishment (Shri R K Sharma vs Union Of India Through Its ... on 12 February, 2013, CAT)

As the management cannot resort to victimization and ULP so as to get rid of the TU leaders, the TU leaders must maintain discipline

a TU leader does not enjoy immunity from proceeded against in case of a misconduct

TU leadership does not provide excuses for indulging in violence ( Usha Breco Mazdoor Sangh v. M/S Usha Breco Ltd. 2008, LLR 619)

Privileges & Rights of Registered TUs

Prof. K.R. Shyam Sundar

XLRI

Common Law Doctrine

It was a requirement for promoting industrialization in England in the 19th Century

It was a part of laissez-faire philosophy

Torts are civil wrongs recognized by law as grounds for a lawsuit. These wrongs result in an injury or harm constituting the basis for a claim by the injured party.

The law of torts was used frequently to protect and serve the economic interests of the trading and business community

So combinations were seen as willfully committing an act to cause damage to the trading and business interests

Criminal conspiracy in trade disputes (Sec 17)

S. 17 - No office-bearer or member of a Registered Trade Union

shall be liable to punishment under sub-section (2) of section 120B of the Indian Penal Code 1860 (45 of 1860)

in respect of any agreement made between the members

for the purpose of furthering any such object of the Trade Union as is specified in section 15,

unless the agreement is an agreement to commit an offence.

S. 120-A of IPC: An agreement between 2 or more persons to do an illegal act or by illegal means

What is an offence? S. 40 of the IPC: denotes a thing made punishable by this Code

120-B prescribes punishment of criminal conspiracy

(1) whoever is a party to a criminal conspiracy to commit an offence punishable.

(2) whoever is a party to a criminal conspiracy other than a criminal conspiracy to commit an offence punishable

Immunity from civil suit in certain cases (Sec 18)

(1) No suit or other legal proceeding shall be maintainable in any Civil Court

against any registered Trade Union or any office-bearer or member thereof

in respect of any act done in contemplation or furtherance of a trade dispute

to which a member of the Trade Union is a party

on the ground only

that such act induces some other person to break a contract of employment,

or that it is in interference with the trade, business or employment of some other person

or with the right of some other person to dispose of his capital or of his labour as he wills.

18 (2) A registered Trade Union shall not be liable in any suit or other legal proceeding in any Civil Court

in respect of any tortious act done

in contemplation or furtherance of a trade dispute by an agent of the Trade Union

if it is proved that such person acted without the knowledge of, or contrary to express instructions given by, the executive of the Trade Union.

Criminal Conspiracy and TU Immunity

Workers instruments of economic coercion in an ID = breach of contract & injury to property right of employer?

An agreement between two or more members to withdraw labour as an instrument of economic coercion in an ID is not an agreement TO DO OR CAUSE TO BE DONE AN ILLEGAL ACT

It means rejection of common law doctrines of restraint of trade and criminal conspiracy with respect to IR

Allows active participation of outside leaders

Immunity is partial and restricted by the phrase unless..offence

Immunity under S. 18 is not absolute (unlawful, tortious or violent acts & which fall outside the umbrella of protection u. s. 18 (CBI v. Central Bank Officers Association, Gujarat 1998, HC)

Case Laws on S. 17/18:

Any violation of law does not give protection from punishments

Unlawful confinement of persons/criminal trespass/violence/criminal force/assault or mischief to persons or property NO PROTECTION

(Jay Engineering Works v. Staff, AIR 1968, Cal. 407)

(Standard Chartered Bank v. Hindustan Engg. & General Mazdoor Union, 2002 LLR 254 (Del).

(Ahmedabad Textile Research Association v. ATRA Employees Union, 1995 LLR 91 (Guj) DB.)

TU does NOT ENJOY IMMUNITY FROM ILLEGAL ACTS (Surpion & Group Staff Union v. AMCO Batteries, 1991)

(Central bank of India v. Central bank Officers Association, Gujarat, 1998 I CLR 597, Guj, H.C.)

West India Steel Co. Ltd. v. Azeez, 1990 LLR 142 (Ker).

(Usha Breco Mazdoor Sangh v. Mgt of M/S Usha Breco Ltd. 2008, LLR, SC)

(Mining and Allied Machinery Corporation Ltd., v. Superintendent of Police, St.Thomas Mount, Madras (1987)

Selvaraj v. Mgt Brakes India Ltd., 1991

Rohtas Industries Ltd. v. Rohtas Industries Staff Union, SC 1976 Protection during Illegal Strike

The main ? Was whether employers can be awarded compensation for loss of profit due to illegal strike under ID Act?

The strike was deemed as illegal and it was owing to inter-union rivalries between two unions

The arbitrators verdicted : (a) no salary for illegal strike period, (b) compensation to company for participating in illegal strike, INR 80,000, (c) 1/8th of costs of arbitration

The trade union challenged the award and the HC quashed the compensation part of the award

The company approached SC

Rohtas Industries Ltd. v. Rohtas Industries Staff Union (contd)

The object of the union is never or rarely to destroy or damage the industry.

The inevitable by-product of combination for cessation of work may be loss to the management but the obvious intendment of such a CB strategy is to force the employer to accept the demand of the workers for betterment of their lot or redressal of injustice, NOT TO INFLICT DAMAGE ON THE BOSS

The real purpose of the combination is the crucial test between innocence and injury

The strike may be illegal but if the object is to bring the employer to terms with the employees or to bully the rival TU into submission, there cannot be an actionable combination in tort

Shadhol Pipe Works v. Zila Laghu Udyog Kamgar Sangh, 2005

A regd TU gave went on a legal strike from 9/7/1989

During which they obstructed the movement of goods out of and workers inside the factory

The employers obtained permanent injunction in restraining the union from inciting acts of intimidation, etc.

The company demanded a compensation of INR 22,500 for loss of production

The civil court has no jurisdiction to entertain a civil suit regarding the legality of the strike but can pass restraining orders on others

Being a regd TU, the TU in the company enjoys immunity arising from s. 18 THEY SHALL NOT BE HELD LIABLE FOR ANY TORTUOUS ACTION DONE IN CONTEMPLATION OR FURTHERANCE OF THE TRADE DISPUTE

The claim for RECOVERY OF DAMAGES by the company is therefore REJECTED

Demonstrations, dharnas, etc.

Demonstrations and dharnas may cause inconvenience to the management. But they are weapons, as strike is, in the armoury of the labour to pressurise the management to accede to their demands. Such demonstrations and dharnas, when they do not turn unlawful, violent and tortuous, cannot be curbed by orders of Civil Court and would come within the purview of Section 18 of the Act (ATRA V. ATRA Employees Union 1993, Gujarat HC)

A workman indulging in commission of a criminal offence should not be spared only because he happens to be a union leader

A union leader does not enjoy immunity from being proceeded with in case of misconduct (Usha Breco Mazdoor Sangh v. Mgt of M/S Usha Breco Ltd. 2008, LLR, SC)

Getting police protection in the context of violent activities to factory is legal (KCP Ltd. v. Inspector of Police, Tiruvottiyur, I LLJ 365)

Immunity not available if unlawful activities are committed

Picketing

Peaceful picketing is allowed and injunctions preventing assembly of persons do not interfere with union rights (Orchid Employees Union v. Orchid Chemicals & pharmaceuticals Ltd., 2008, LLR 519) (see also Indian Bank v. Federation of Indian Bank Employees Union, 1982, 1, LLJ 123)

Picketing described as Marching to and fro before the premises of an establishment involved in a dispute, generally accompanies by the carrying and display of a sign or banner, etc. Picketing may be accompanied by a polite request asking workers not to assist in the running of that establishment or customers not to patronize that establishment (D Ganesh v Shate (1961)]

Peaceful picketing are protected.

Picketing ceases to be peaceful the moment it results in a private or public nuisance.

Any show or threat of violence or ANY FORM OR FORCE & any other unlawful threat likely to create fear in the mind of a reasonable man will render picketing unlawful.

Pickets cannot force people to listen to them. They cannot obstruct the passage of customers goods vehicles etc.

Thus the right to picket is closely limited by the equal right of others to go about their lawful affairs free form obstruction molestation or intimidation (Simpson & Group Co. Workers Union v Amco batteries(1992)

S. 19. Enforceability of agreements

An agreement between the members of a regd TU shall not be void or voidable merely by reason of the fact that any of the objects of the agreement are in restraint of trade

This section INVALIDATES THE S.27 OF THE CONTRACT ACT, 1872.

S. 27 of the Indian Contract Act deals with restraint of trade agreements: every agreement by which any one is restrained from exercising a lawful profession, trade or business of any kind, is to THAT EXTENT VOID.

Watch it!!!!

On the Threshold: Class Struggle in Delhi,

https://www.youtube.com/watch?v=2F7eYpzD8c8