legislation concerning settlement of industrial dispute

1. SAL INSTITUTE OF MANAGEMENT
Subject- Human Resource Management
Presented By-Akash Thakkar

2. FLOW OF PRESENTATION
I. Legislation Preceding Industrial Disputes Act,1947
II. Enactment Of Industrial Disputes Act, 1947
III. What is industrial disputes?
IV. Authorities And Reference Of Disputes
V. Miscellaneous Provisions Relating To Procedures,
Powers Of Adjudication Authorities And Awards
VI. Prohibition of strikes and Lock-outs
VII. Lay-off, retrenchment and closure

3. Legislation Concerning Settlement of
Industrial Disputes

4. Legislation Preceding Industrial
Disputes Act,1947
Employers and workmen (Dispute) Act, 1860
• The first legislation measure dealing with the
settlement of industrial disputes in India was the
Employers and Workmen (Disputes) Act,1860.
• The Act empowered magistrates to dispose of
disputes concerning wages of workmen employed in
railways, canals, and other public works, and made
the breach of contract a criminal offence.

5. Enactment Of Industrial Disputes Act,
1947
• At the time of industrial disputes act, 1947 was being
enacted, there was a considerable increase in
industrial unrest owing to the “stress of post-war
industrial re-adjustment”.
• The Act, which came into force on April 1, 1947,
introduced the principle of compulsory conciliation
and adjudication of industrial disputes in certain
cases, and created two new institutions namely,
Works Committee and Tribunal.

6. Industrial Disputes Act, 1947
• Industrial Disputes: Any
Disputes or difference
between employers and
employers or between
employers and workmen,
or between workmen and
workmen, which is
connected with the
employment or non-
employment or the terms
of employment or with the
conditions of labour of any
person.

7. Authorities And Reference Of
Disputes
The authorities for prevention or
settlement of disputes under the act
include:
1. Grievance Settlement Authority
2. Work Committee
3. Conciliation officer
4. Board of Conciliation
5. Court Of Inquiry
6. Labour court
7. Industrial Tribunal
8. National tribunal

8. 1. Grievance Settlement Authority
• In every industrial in which fifty or more
workmen are employed or have been
employed on any day in the preceding twelve
months, the employer is required to
constitute, in accordance with the rules the
framed in this regard, a grievance settlement
authority for the settlement of industrial
dispute connected with an individual
workman employed in the establishment.

9. 2. WORKS COMMITTEE (Sec-3)
• Constituted based on appropriate Government
order
• Applicable to industrial establishment in which
100 or more workmen are employed on any day
in the preceding 12 months
• Consists of representatives of employers and
workmen engaged in the establishment.
• Number of workmen representatives shall not
be less than the number of employer’s
representatives
• Representatives of workmen are selected in
consultation with Trade union

10. DUTIES
• To promote measures for securing and preserving amity
and good relations between the employer and the
workmen
• To comment upon matters of their common interest or
concern.

11. 3. CONCILIATION OFFICERS (Sec 4)
– The appropriate government, by notification in the
official Gazette appoints a specific number of persons as
it think fit to be as conciliation officers
– Conciliation officer may be appointed for a specified
area or for specified industries in specified area either as
permanent or for a limited period
– A conciliation officer shall be deemed to be as a public
servant as per Sec. 21 of Indian penal code 1860

12. Duties
1. When any industrial disputes exist, the conciliation officer
should hold conciliation proceedings in a prescribed
manner without delay to have right settlement.
2. Whether settlement is reached or not, the conciliation
officer must submit the report within 14 days of the
commencement of the conciliation proceedings or within
the date fixed by the appropriate government
3. If the report submitted in satisfied to the appropriate
Government, it may or may not refer the dispute to any
authority under the Act. If the Government is not making
any reference, it should record and communicate the
reason to the contending parties
4. The duty of a conciliation officer is administrative and not
judicial

13. • 4. BOARD OF CONCILIATION (Sec5)
– The appropriate Government by a notification in the official
Gazette constitutes a Board of Conciliation for promoting the
settlement of an industrial dispute
– The Board consists of a Chairman and two or four other
members, as the appropriate government thinks fit
– The Chairman shall be an independent person; unconnected
with the dispute
– The other members shall be persons appointed in equal
number to represent the parties to the dispute
– The person appointed to represent a party shall be appointed
on the recommendation of the party
– The appropriate Government appoints a fit person as it thinks,
if any party fails to make a recommendation within a
prescribed period
– A Board of Conciliation can act only when a dispute is referred
to it by the Government

14. DUTIES
1.When a dispute has been referred to a Board, it
will investigate the matter affecting the merits
and right settlement of the dispute without delay
2. Whether settlement is reached or not, the Board
must submit the report within two months of the
date on which the dispute was referred to it
3. If no settlement is arrived, the Government may
refer the dispute to the labour court, Industrial
Tribunal or National Tribunal.
4. The time for submission of report may be
extended by such period as may be agreed to in
writing by all the parties to the disputes

15. Cont….
5. The report of the Board shall be in writing and
shall be signed by all the members of the
Board.
6. The report submitted shall be published by
the appropriate Government with in 30 days
from the receipt
7. A Board of Conciliation can only try to bring
about a settlement. It has no power to impose
settlement on the parties to the dispute

16. 5. COURT OF INQUIRY (Sec 6)
• The appropriate Government, by notification in the
official Gazette, constitutes a Court of Inquiry in to
any matter relevant to an Industrial dispute
• A Court of Inquiry consists of one independent
person or of number of independent persons as the
appropriate Government may think fit
• Court of Inquiry consists of two or more members,
one of them shall be appointed as Chairman
• The Court of Inquiry can act under a prescribed
quorum; even at the absence of Chairman
• If the service of the chairman is ceased by the
Government through notification, the court shall not
act until a new chairman has been appointed

17. DUTIES
• A Court shall inquire into the matters
referred to it and report to the appropriate
government within a period of 6 months
from the commencement of the inquiry
• The report of the court shall be in writing
and signed by all the members of the court.
Members are free to record their dissent
• The report submitted shall be published
within a period of 30 days of its receipt by
the Government

18. 6. LABOUR COURT (Sec 7)
1. A labour court consists of one person only to be
appointed by the appropriate Government
2. A person shall not be qualified for appointment as
presiding officer of a labour court unless
a) He is / has been a Judge of a High Court
b) He has been as a District Judge /Additional
District Judge for a period not less than three years
c) He has held any judicial office in India for not
less than seven years
 Labour court consist to settlement of disputes like
1) the propriety or legality of an order passed by an
employer under the standing order

19. 2) Discharge or dismissal of workmen
3) Withdrawal of any customary concession
4) Strike or lock-out
DUTIES
1. Adjudicate upon the industrial disputes relating to
any matter specified in the Second Schedule
2. When an industrial dispute has been referred to a
labour Court for adjudication ,within the specified
period, it should submit award to the appropriate
Government
3. It shall be published in such manner as the
appropriate Government thinks fit within a period of
30 days from the date of its receipt by the
appropriate Government

20. 7. INDUSTRIAL TRIBUNAL (Sec7-A)
• The appropriate Government by notification in
the official Gazette , constitute one or more
industrial tribunals for the adjudication of
industrial disputes relating to any matter
specified in Second or Third Schedule are as
following
1. Wages, including the period and mode of
payment
2. Compensatory and other allowances
3. Hours of works and intervals
4. Leave with wages and holidays
5. Retrenchement of workmen and closure of
establishment

21. Cont….
• The Tribunal consists of one person to be appointed by
the appropriate Government
• A person shall not be qualified for appointment as the
presiding officer of an Industrial Tribunal unless
a) He is/ has been a Judge of a High Court
b) He has been a District Judge / Additional District
Judge for a period of three years
• No person shall be appointed to or continue in office of a
presiding officer if
• He is not an independent person.
• He has attained the age of 65 years.

22. DUTIES
• It shall submit its award to the appropriate
Government within a specified period if an
industrial dispute is referred to an Industrial
Tribunal
• The award shall be in writing and shall be signed
by its presiding officer
• The award shall be published by the appropriate
government within a period of 30 days in a
manner as the appropriate government thinks fit
• As it is a quasi – judicial body, it must serve notice
upon the parties to the reference by name before
making any award

23. 8. NATIONAL TRIBUNAL (Sec7-B)
• The Central government ,by notification in the
official Gazette constitute one or more National
Industrial Tribunals for the adjudication of
industrial disputes :
1.Involving questions of national importance
2.Which are of such a nature that industries are
more than one state are likely to be interested in,
or affected by, such disputes
3.Matters appearing in Second and Third schedule
• A National Tribunal consists of one person to be
appointed by Central Government
• A person shall not be qualified for appointment as
a presiding officer of a National Tribunal unless he
is / has been a Judge of High Court

24. No person shall be appointed to ,or continue in
the office of the presiding officer of a National
Tribunal if
• He is not an independent person
• He has attained the age of 65 years
DUTIES
• When an industrial dispute is referred to the
National Tribunal for adjudication, it shall submit
its award to the appropriate government
• The award shall be in writing and shall be signed
by the presiding officer of the National Tribunal
• It shall publish the award within a period of 30
days from the date of its receipt by Central
Government

25. Miscellaneous Provisions
• Payment of Full Wages Pending
to Higher Courts
• Commencement and Conclusion
of Proceedings
• Publication and Commencement
of Award
• Period of Operation of Awards
• Persons on Whom an Award is
Binding
• Certain Matters to be Kept
Confidential

26. Prohibition of strikes and Lock-outs
General Prohibition Of strikes and
Lock-outs
According to Section23,no workman
who is employed in any industrial
establishment shall go on strike in
breach of contract & no employer of
any such workman declare a
Lockout:
a) During the pendency of conciliation
proceedings before a board & 7days
after the conclusion of such
proceedings.
b) During the pendency of proceedings
before a labour court,Industrial or
national tribunal & 2 months after
the conclusion of such proceedings.

27. CONT....
C) During the pendency of Arbitration
proceedings before an arbitrator and two
months after the conclusion of such
proceedings.
d) During the period in which a settlement or
award is in operation,in respect of any of the
matters covered by the settlement or
award.But there is no bar to call strike or
declare lockout in respect to other matters.

28. Penalty for illegal strikes and lock-outs
(1) Any workman who commences, continues or
otherwise acts in furtherance of, a strike which is illegal
under this Act, shall be punishable with imprisonment
for a term which may extend to one month, or with
fine which may extend to fifty rupees, or with both.
(2) Any employer who commences, continues, or
otherwise acts in furtherance of a lock-out which is
illegal under this Act, shall be punishable with
imprisonment for a term which may extend to one
month, or with fine which may extend to one thousand
rupees, or with both.

29. Prohibition of Strikes in Utility Services
• A person employed in public utility service must not go
on strike in breach of contract:
(a) Without giving to the employer a notice of strike within
six weeks before striking
(b) Within Fourteen days of giving such notice
(c) Before the expiry of the date of strike specified in the
notice
(d) During the pendency of conciliation proceedings
before a Conciliation Officer and seven days after the
conclusion of such proceedings

30. Cont...
2) No employer carrying on any public utility service shall
lock-out any of his workmen-
• (a) without giving them notice of lock-out as
hereinafter provided, within six weeks before locking-
out; or
• (b) within fourteen days of giving such notice; or
• (c) before the. expiry of the date of lock-out specified
in any such notice as aforesaid. or
• (d) during the pendency of any conciliation
proceedings before a conciliation officer and seven
days after the conclusion of such proceedings.

31. Prohibition of financial aid to illegal strikes and
Lockouts
No person shall knowingly expend or apply any money
in direct furtherance or support of any illegal strike or
lock-out.
Any person who knowingly expends or applies any
money in direct furtherance or support of any illegal
strike or lock-out shall be punishable with
imprisonment for a term which may extend to six
months, or with fine which may extend to one
thousand rupees, or with both.

32. LAY-OFF, RETRENCHMENT, AND
CLOSURE
 LAY-OFF
Layoffs as defined in the act,
are the failure refusal, or
inability of an employer to give
employment to those whose
name appear on the
employment roll of the
establishment.
Laid off employees (who fulfill
certain conditions) are entitled
to lay off compensation at the
rate of 50% of their basic and
dearness allowance. A layoff is
a temporary situation and
once the situation improves
laid off employees have to be
taken back.

33. RETRENCHMENT
• Section 2 (oo) of the Industrial Disputes Act, 1947 defines Retrenchment as –
” the termination by the employer of the service of a workman for any reason
whatsoever, otherwise than as a punishment inflicted by way of disciplinary action,
but does not include -
(a) voluntary retirement of the workman, or
(b) retirement of the workman on reaching the age of superannuating if the
contract of employment between the employer and the workman concerned
contains a stipulation in that behalf; or
(b) termination of the service of the workman as a result of the non-removal of
the contract of employment between the employer and the workman concerned
on its expiry or of such contract being terminated under a stipulation in that behalf
contained therein; or
(c) termination of the service of a workman on the ground of continued ill-health;

34. Closure
1) The term "closure" is defined under Section 2(cc) of the
I.D.Act. It means the permanent closing down of a place of
employment or part.
2) Section 25FFF of the Industrial Disputes Act, 1947deals
with compensation to workmen in case of closing down of
undertakings. The relevant part of sub-section (1) of
Section 25-FFF (omitting the provision) reads as under:
• Compensation to workmen in case of closing down of
undertakings.(1) Where an undertaking is closed down for
any reason whatsoever, every workman who has been in
continuous service for not less than one year in that
undertaking immediately before such closure shall, subject
to the provisions of sub-section (2), be entitled to notice
and compensation in accordance with the provisions of
Section 25-F, as if the workman had been retrenched:

35. CONT....
3) you have to give notice to labour office regarding the
closing of your establishment. Then same as communicated
to your all employees(Individually)
4) you have to pay notice pay and retrenchment
compensation of 15 days salary for every completed year of
service
5) you also have to pay gratuity to employees who have
completed 5 years of service
6) payment of gratuity act is applicable to workers employed
in every factory, shop & establishments or educational
institution employing 10 or more persons on any day of the
proceeding 12 months.
7) The amount of gratuity payable shall be at the rate of 15
days wages based on the rate of wages last drawn, for
every completed year of service. The maximum amount of
gratuity payable is RUPEES TEN LAKHS.

36. Penalty for closure
(1) Any employer who closes down an undertaking without
complying with the provisions of sub-section (1) of section
250 shall be punishable with imprisonment for a term,
which may extend to six months, or with fine, which may
extend to five thousand rupees, or with both.
(2) Any employer, who contravenes 1[an order refusing to
grant permission to close down an undertaking under sub-
section (2) of section 25O or a direction given under section
25P], shall be punishable with imprisonment for a term
which may extend to one year, or with fine which may
extend to five thousand rupees, or with both, and where
the contravention is a continuing one, with a further fine
which may extend to two thousand rupees for every day
during which the contravention continues after the
conviction.

37. Penalty for breach of settlement or
award
1. Penalty for breach of settlement or award. Any person who
commits a breach of any term of any settlement or award,
which is binding on him under this Act, shall be punishable
with imprisonment for a term which may extend to six
months, or with fine, or with both, 2[and where the breach
is a continuing one, with a further fine which may extend to
two hundred rupees for every day during which the breach
continues after the conviction for the first] and the Court
trying the offence, if it fines the offender, may direct that
the whole or any part of the fine realised from him shall be
paid, by way of compensation, to any person who, in its
opinion has been injured by such breach.]

38. Penalty for disclosing confidential
information
• Any person who wilfully discloses any such
information as is referred to in section 21 in
contravention of the provisions of that section
shall, on complaint made by or on behalf of
the trade union or individual business
affected, be punishable with imprisonment for
a term which may extend to six months, or
with fine which may extend to one thousand
rupees, or with both.

39. Case study : HERO HONDA
• Hero Honda Motors Limited .
• Joint Venture 1983 :- The Hero Group of India
and Honda of Japan
• It is world's biggest manufacturer of 2 wheeler
vehicles.
• Dharuhera , Gurgaon and at Haridwar these plant are
capable of manufacturing 3.9 million bikes per year.
• capacity of these plant 6,000 units per day.
• There are about 1,200 permanent workers, while 4,000
are on contract .

40. CASE FACTS
• CASE FACTS
• Place : Hero Honda Gurgaon Plant
• Strike Duration : 10 April 2006 - 14th April 2006
• No. of workers involved: 4000
• Casual workers Demands: Wage hike, extra casual
leave and medical benefits at par with the
permanent workers.
• Financial Loss: Loss of ₹ 100 crore .
•

41. BACKGROUND:
• A Contractual Worker Average paid is ₹ 5000 P/M
and ₹ 40,000 P/M salary of a Permanent Worker
performing the same job.
• Contractual workers recruited not only get low
wages but also do not receive any pay slip or
cards. The casual helper at the plant gets a
meager ₹ 2000-2500 at the end of the month.
The management and the contractors are equally
involved in the exploitation of the contract
worker

42. ACTION TAKEN & SOLUTION:
• 14th April 2006, A Tripartite meeting was held between
Haryana's Additional Labor Commissioner, Management
and Worker Representatives and they agreed for a
settlement, under which some demands were met. It was
an important victory for the contract workers, who are
otherwise forced to live in miserable conditions.
• The agreement included : 30% hike in salary ,Two days of
casual leave every month and Medical benefits in
accordance with the company rules, Issuing identity cards
ATM cards Opening bank accounts for the casual workers.

43. Conclusion
• Issues between the management and workers
should be resolved beforehand.
• There should be a good communication link
between the worker and the management.
• Management should not suppress the rights
of the worker.