Industrial Dispute Act 1947

Course: MBA SEM 2

Subject: Human Resource

Management

Unit: 4

Industrial Dispute Act 1947

• Act came in to force on 1st April 1947

• Followed by certain amendments

Definitions• Industrial Dispute:-

Any dispute or difference between employersand employers, employers and workmen, orbetween workmen and workmen which isconnected with the employment or nonemployment or terms of employment or withconditions of labour of any person.

Workman• Any person employed in any industry to do any

manual,unskilled,technical or supervisory work for hire or reward

• Terms of employment express or implied

• Includes any person who has been dismissed , discharged or retrenched

• But does not include any person,

1. who is subject to, Army , Airforce or navy wing

2. Employed in police service or employee of prison

3. Employed mainly in managerial and administrative capacity

4. Employed in supervisory capacity drawing wages exceeding 1000 and 600 per mensem

• Strike (Sec 2(q))

A Cessation of work by a body of persons employed inany industry acting in combination or a concerted refusalunder a common understanding of any number ofpersons who are or have been so employed to continueto work or to accept employment.

• Lock – Out (Sec 2.(1))

The closing of a place of employment or the suspension of work or the refusal by an employer to continue to employ any number of persons employed by him.

Lay off (Sec 2 KKK)

• The Failure, Refusal or inability of an employer on account of shortage of coal, power or raw materials or the accumalation of stocks or the breakdown of machinery or natural calamity or any other connected reason

• to give employment to workman whose name is borne on the muster rolls of his establishment and who has not been retrenched.

Retrenchment (Sec 2 (oo))• The termination by employer of the services

of a workman for any reason whatsoever otherwise a punishment inflicted by way of a disciplinary action but does not include:

1. Voluntary Retirement

2. Retirement on Superannuation age

3. Termination due to non renewal of employment contract

4. Termination on ground of continued ill health

Industrial Disputes: Preventive Machinery

Voluntary Methods

Collective Bargaining

Trade Unions

Joint consultations

Standing Orders

Grievance Procedure

Code of Discipline

Government Machinery

Labour Administration

Machinery

State Level

Central Level

Statutory Measures

Works Committees

Conciliation

(a) C. Officer

(b) C. Board

Arbitration

Adjudication

(a) Labour Courts

(b) Industrial Tribunals

(c) National Tribunals

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Machinery for prevention and settlement of disputes

Industrial Disputes: Settlement Machinery

Conciliation

Conciliation is a process by which representatives of workers and employers

are brought together before a third person or a group of persons with a view

to persuade them to come to a mutually satisfying agreement.

Voluntary Arbitration

When conciliation proceedings fail to settle the dispute, the conciliation officer

may persuade the conflicting parties to voluntarily refer the dispute to a third

party known as Arbitrator, appointed by the parties themselves.

Adjudication

Adjudication or compulsory arbitration is the ultimate remedy for the

settlement of disputes in India.

The Industrial Disputes Act, 1947, provides a three-tier adjudication

machinery – namely Labour Courts, Industrial Tribunals and National

Tribunals – for the settlement of industrial disputes.

Authorities for settlement of disputes

1. Grievance settlement Authority

2. Works Committee

3. Conciliation Officer

4. Board of Conciliation

5. Court of inquiry

6. Labour Court

7. Tribunal

8. National Tribunal

9. Arbitrator

1.Grievance settlement Authority• Deals with mainly Individual Disputes

• 50 or more workers are employed or have been employed in preceding 12 months

• Indivual / TU may refer the dispute for settlement

• Prescribed procedure in specified time

• If decision is not acceptable than only dispute may be referred to other bodies.

• Grievance procedure( Complaint to section Head to Complaint to Union)

2.Works Committee

• Government is empowered to make Order to form Woks committee

• 100 or more workers are employed or have been employed in preceding 12 months

• Constitution

• Consist representatives of employers and workmen

• Worker’s representatives should not be less than employer’s representatives

• Representatives of workers should be engaged in establishment

• Functions• To promote measures for securing good relation between employer and

workmen and to work towards resolving any material differences

3.Conciliation Officer• Government is empowered to appoint

• Duties

• Investigate the dispute to promote right settlement

• May take appropriate steps to induce parties for fair settlement

• After settlement copy of report and memorandum of settlement toappropriate government

• Required to submit report within 14 days which may be extended

• Powers

• Same powers as vested in a civil court in respect of attendance, examination, production of documents .

• Deemed to be a public servant (IPC)

4. Board of Conciliation

• Appropriate Govt, On Occasion , for promoting settlement of dispute may constitute

• Composition

• An independent Chairman and two or four members in equal numbers representing the parties

• References of dispute to board of conciliation

At any time by order in writing dispute may be referred to board for settlement

When dispute is referred to board Government may prohibit continuance of any strike or lock out

• Duties and Powers

• Investigate the dispute to promote right settlement

• May take appropriate steps to induce parties for fair settlement

• After settlement copy of report and memorandum of settlement toappropriate government

• If settlement not done Required to submit report within 2 monthsdays which may be extended

• Same powers as vested in a civil court in respect of attendance, examination, production of documents etc.

• All members are deemed to be a public servant (IPC) and board inquiry as judicial inquiry

• Commencement and conclusion of proceedings

• Commencement on date on which notice of strike or lockout is received

• Concluded when memorandum of settlement signed , report received by government and when a reference is made to other settlement bodies.

• Period of Operation of Settlement

• Agreed upon by parties to the dispute if not decided than six months from the date on which memorandum of settlement is signed.

• Persons on whom settlements are binding

5. Court of inquiry• For the purpose of inquiring any matter connected with

the industrial dispute.

• Either One or more , one of them to be appointed as thechairman

• Within 6 months court of inquiry needs report to theappropriate government

• Report should be in written and signed by its members

• Report needs to be published within 30 days

• Same powers as vested in a civil court in respect ofattendance, examination, production of documents .

• Deemed to be a public servant (IPC)

6. Labour Court

• One or more Labour court may be constituted for adjudication of Industrial dispute

• Consist of one person only ( Age not more than 65 years )

• who is or has been a judge of a high court

• Has been a district judge or additional district judge for not less than three years

• Held judicial office in India not less than 7 years

• Has been the presiding officer of a labour court for not less than five years

• Performs functions as listed in second schedule of Act

• All matters other than mentioned in 3rd schedule within jurisdiction of industrial Tribunals

7. Tribunal

• One or more Labour court may be constituted for adjudication of Industrial dispute

• Consist of one person only ( Age not more than

65 years )• who is or has been a judge of a high court

• Has been a district judge or additional district judge for not less than three years

• Government may also appoint two assessors to advise the tribunal in the proceeding.

• Mainly performs functions as listed in 3rd

schedule of the Act

8. National Tribunal

• Central Government is empowered to constitute one or more NT.

• Consist one person to be appointed by central government who is or has been a judge of high court( Age not more than 65 years )

• Central government may appoint two assessors to advise

9. Arbitrators• By mutual agreement dispute might be referred to

arbitrator before it is referred to adjudication authority.

• Presiding officers may be appointed

• If even no of arbitrators exist an appointment of umpire should be done

• Duty of arbitrator to investigate dispute and do submission to appropriate government

• Within one month of receipt of agreement copy it should be published by govt.

Prohibition of Strikes and lockoutsNo workmen employed in any establishment go on strike

a) During conciliation proceedings and after 7 days of conclusion of proceedings

b) During proceedings before labour court, tribunal or national tribunal and after 2 month of conclusion of proceedings

c) During pendency of arbitration process 2 months after the conclusion

d) During period in which a settlement or award is in operation

For Lock out same prohibitions apply.

Lay Off , Retrenchment and Closure

Provisions and Special Provisions

Lay Off

• Provisions related to Lay off do not apply to establishment

a) In which less than 50 workmen on avg per working day in preceding month

b) A seasonal unit working intermittently

• Compensation of laid off workmen

a) A workman other than badly worker , name on muster roll , completed 1 yr- 50 % of basic wages+ DA( not for weekly holidays)

b) If During any 12 months worker laid off for more than 45 days –no compensation in respect of any period of lay off after 45 days

• Cases when workmen not entitled for compensation

a) When worker refuses to accept any alternative employment by employer within 5 miles from establishment and for same wages

b) If he does not present himself for work at the establishment at appointed time during working hrs at least once a day

c) If lay off is due to strike or slow down in another part of establishment

Retrenchment

• Act prohibits to retrench any workman employed inindustry for not less than 1 year except following :

a) Workman is given notice in written for reason of retrenchment

b) Workman is paid compensation equivalent to 15 days averagepay for completed yr or any part of it in excess of 6 months

c) A notice served by government or appropriate authoritynotification is passed in official gazette.

• Compensation for Retrenchment in case of Transfer Of undertaking

A workman is not entitled for compensation unless:

1. There has been interruption in the services due to transfer

2.Terms and condition of services after transfer applicable are less favorable

3. The new employer not liable to pay on ground that his services has been interrupted by the transfer.

Closure

• Required to serve notice to appropriate government with clearreasons at least 60 days before

• Not required when less than 50 workers work in preceding yr

Compensation Every worker entitled to compensation and for notice of closure who has worked for 1 yr

In case if closure is beyond control of employer compensation should not exceed his average pay for 3 months

Special Provisions

• Incorporated in the Act 1976 and further modified in 1982 and 1984

• Applicability

• Lay off

a) No workman except badli worker can be laid off except prior permission of government

b) Permission for lay off, 30 days to continue same

c) Appropriate Govt may approve or disapprove

d) If order granted needs to be communicated to both parties , if not it is deemed to have been granted for 60 days

• If application for continuance or permission is not granted lay off is illegal

• In exceptional circumstances as accident or death of the employer if government approve permission is not required.

• Retrenchment

1. 3 months notice in written or wages for the period of notice

2. Prior permission of appropriate Government

If permission is granted, workmen are entitled to receive

15 day’s Avg pay for every completed year of service Or any part in excess of 6 months

Other provisions remain same as lay off.

• Closure

• Before 90 days prior permission for closure

• Permission not essential in case of undertaking setup for construction of building, bridges, roads, canals dams.

• Provisions pertaining to conduct of inquiry, opportunity to be heard, communication…..etc same as retrenchment

• Changes yet to be incorporated.

Bibliography

• http://www.whatishumanresource.com

• http://www.mbaofficial.com

• Human Resource and Personnel

Management- K. Aswathappa, Tata

McGraw Hill