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DISPUTE RESOLUTION
METHODS &
MACHINERY
M140039MS Ajay Ram K P
What is an Industrial Dispute?
Disputes mainly relate to the strife between employers and
their employees.
 According to the Industrial Dispute Act,1947 sec (2(k)),
Industrial disputes mean any dispute 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
terms of employment or with the conditions of labor of any
person.
Causes of industrial Disputes:
Causes of Industrial disputes may be grouped into four categories :
(A) Industrial Factors
(B) Managements Attitude towards workers
(C) Government Machinery ; and
(D) Other Causes
Industrial Factors :
Under this category, some of the causes of dispute may be :
(i) An industrial matter relating to employment, work, wages,
hours of work, privileges, the rights and obligations of employees
and employers & terms and conditions of employment.
(ii) An industrial matter in which both the parties are directly and
substantially interested.
(iii) Disputes arising out of unemployment, inflation, change in the
attitude of employers and rivalry among unions.
Management Attitude Towards Labor :
(i) Management ‘s unwillingness to talk over any dispute with their
employees.
(ii) Managements unwillingness to recognize a particular trade union ,
delegating enough authority to the representatives etc.
(iii) Unwillingness to negotiation and settlement of disputes.
(iv) Managements insistence to take care of recruitments, promotion etc.
without consulting the concerned employees
(v) Managements unwillingness to provide services and benefits to its
employee's
Government Machinery :
(a)Though there are number of enactments for promotion of
harmonious relations, it is ineffective and unsatisfactory due to
various reasons like their irrelevancy in the context of the challenges
of present industrial climate /culture, incapability of understanding
and answering imperatives of development, improper and inadequate
implementation by many employers.
(b) The governments conciliation machinery has settled a very
negligible number of disputes .
Other Causes :
(i)Affiliation of the trade unions with a political party, where the
latter may instigate the trade unions to conduct strikes, lockouts ,
gheraos etc.
(ii) Political instability, center- state relations, sometimes result into
industrial conflict.
(iii) Other potential factors like corruption in industry and public life,
easy money etc. can also result into industrial disputes.
Strikes
Lockouts
Primary
Strikes
Secondary
Strikes
Others
1. General
2. Particular
3. Political
4. Bandhs
Stay-
away
Strikes
Sit down,
Stay-in
Tool Down or
Pen Down
Strikes
Go -
Slow
Work
To
Rule
Token
or
Protest
Strikes
Industrial Disputes
Lightening
or Cat-
Call
strikes
Picketing
& Boycott
Gherao Hunger
Strikes
How to settle the disputes??
Whatever may be the cause of industrial disputes, the consequences
are harmful to all stakeholders- management, employees, economy
and the society . For management, disputes result in loss of
production, revenue, profit, and even sickness of the plant.
Employees would be hard hit as the disputes may lead to lockouts
and consequent loss of wages and even jobs.
Various methods are available for resolving disputes. Most important
of them are :
Collective
Bargaining
Code of
Discipline
Grievance
Procedure
Consultative
Machinery
Arbitration
Conciliation
Adjudication
Dispute
Settlement
Collective Bargaining
 A technique by which dispute as to conditions of employment,
are resolved amicably, by agreement, rather than by coercion
 The dispute is settled peacefully and voluntarily, although
reluctantly, between labor and management.
 The final outcome of bargaining may also depend upon the art,
skill and dexterity of displaying the strength by the
representatives of one party to the other.
Code of Discipline
 The code of discipline defines duties and responsibilities of
employers and workers. The objectives of the code are:
1. To ensure that employers and employees recognize each others
rights and obligations.
2. To promote consecutive co-operation between parties concerned
at all levels.
3. To eliminate all forms of coercion, intimidation and violence in
IR.
4. To avoid work stoppages.
5. To facilitate the growth of trade unions.
6. To maintain discipline in the industry.
Grievance Procedure
 Grievance is any discontent or dissatisfaction, arising out of employment
relationship, which an employee thinks , believes or feels to be unfair,
unjust or inequitable.
 A grievance procedure is a formal process which is preliminary to
arbitration, which enables the parties involved to attempt to resolve their
differences in a peaceful and orderly manner.
 It enables the company and the trade union to investigate and discuss the
problem at issue without in any way interrupting the peaceful conduct of
business.
 When the grievance redressal machinery works effectively, it
satisfactorily resolve most of the disputes between labor and
management.
Arbitration
 Arbitration is a procedure in which a neutral third party studies the
bargaining situation, listens to both the parties, gathers information and
then makes recommendations that are binding on both the parties.
 Arbitration is effective means of resolving disputes because it is :
1. Established by the parties themselves and the decision is acceptable
to them.
2. Relatively expeditious when compared to courts and tribunals.
Conciliation
 Conciliation is a process by which the 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 be an individual or a group of people. 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.
Conciliation
 Conciliation officer: an authority appointed by the government to
mediate disputes between parties brought to his notice; enjoying the
powers of a civil court. He is supposed to give judgment within 14 days
of the commencement of the conciliation proceedings.
 Board of conciliation: The Board is an adhoc, tripartite body having the
powers of a civil court created for a specific dispute(when the conciliation
officer fails to resolve disputes within a time frame, the board is
appointed)
 Court of enquiry: In case the conciliation proceedings fail to resolve a
dispute, a court of enquiry is constituted by the government to investigate
the dispute and submit the report within six months.
Adjudication
 Adjudication means a mandatory settlement of an industrial dispute by a
labor court or a tribunal. Generally, the government deems a dispute for
adjudication depending on the failure of conciliation proceedings.
 Section 10 of the Industrial Act, 1947, provides for reference of a dispute
to labor court or tribunal.
 Disputes are generally referred to adjudication on the recommendation of
the conciliation officer who had dealt with them earlier. The government
has a discretionary powers to accept or reject recommendations of the
conciliation officer. It is obvious that once is referred for adjudication ,
the verdict of a labor court or tribunal is binding on both the parties.
 This is the most significant instrument of resolving disputes. But, it has
been criticized because of the delay involved in resolving conflicts.
Consultative Machinery
 Consultative machinery is set by the government to resolve conflicts. The
main function is to bring the parties together for mutual settlement of
differences in the spirit of co-operation and goodwill.
 A consultative machinery operates at plant , industry , state and national
levels. At plant level, there are works committee and joint management
councils. Being bipartite in character, works committee are constituted as
per the provisions of industrial Disputes Act, 1947 and joint management
councils are set up following the trust laid down in the Industrial Policy
Resolution,1956. At the industry level, there are wage boards and
industrial committee.
 Labor advisory boards operate at the state and at the all India level
there are Indian labor conference and the Standing labor committee.
The bodies operating at state and national level, are tripartite in character
STRIKES, LOCKOUTS, LAYOFFS &
RETRENCHMENT
Strikes
 Strike is one of the oldest and the most effective weapons of labor in its
struggle with capital for securing economic justice.
 Strike has been defined in Section 2 (q) of the Industrial Disputes Act
as—
“Strike means a cessation of work by a body of persons employed in
any industry acting in combination, or a concerted refusal, or a refusal
under a common understanding, of any number of persons who are or
have been so employed to continue to work or to accept
employment.”
 Two main ingredients of strike are
 Cessation of Work
 Concerted Action
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, or the refusal by an employer to continue to employ any number
of persons employed by him.
 It is declared by employers to put pressure on their workers. It is
counterpart of a strike.
 Lockout may happen for several reasons. When only part of a trade
union votes to strike, the purpose of a lockout is to put pressure on a
union by reducing the number of members who are able to work.
 Every employer has the option to lock out workers, if – a dispute has
been referred to a council or the Commission for Conciliation, Mediation
and Arbitration (CCMA); a certificate that a dispute remains unresolved
has been issued; 30 days have elapsed since the referral; and
Lockouts
 II ) 48 hours’ written notice of a strike is given to
a. the employer; or
b. a council (if the dispute relates to a collective agreement to be
concluded in a council); or
c. to an employers’ organization (if the employer is a member of an
organization that is a party to the dispute); or
 III) 48 hours’ written notice of a lockout is given to
a. the trade union; or
b. to the workers (if they are not trade union members); or
c. a council (if the dispute relates to a collective agreement to be
concluded in a council)
Layoffs
 Layoff implies temporary removal of an employee from the payroll of the
organization due to circumstances beyond the control of the employer.
 It may last for an indefinite period. But the employee is not terminated
permanently and is expected to be called back in future. The employer
employee relationship does not come to an end but is merely suspended
during the period of layoff. It is temporary denial of employment.
 The purpose of layoff is to reduce the financial burden on the
organization when the human resources cannot be utilized profitably.
Layoffs
 Under Section 2(KKK) of the Industrial Disputes Act, 1947, layoff is
defined as “the failure, refusal or inability of an employer, on account of
shortage of coal, power or raw materials or accumulation of stocks or
breakdown of machinery or by any other reason, to give employment to a
workman whose name appears on the muster rolls of his industrial
establishment and who has not been retrenched”.
 Layoff is restored in cyclical and seasonal industries. In mines workers
are laid off due to excess of inflammable gas, flood, fire and explosion.
Retrenchment
 Retrenchment means permanent termination of service of an employee
for economic reasons in a going concern.
 The Industrial Disputes Act, 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 retirement either voluntary or reaching age of
superannuation, or continued ill-health or the closure and winding up of a
business”.
Retrenchment
 The Act lays down the following conditions for retrenchment.
 1.The employee must be given one month’s notice in writing indicating
the reasons for retrenchment or wages in lieu of such notice.
 2. The employee must be paid compensation equal to 15 days for every
completed year of service.
 3. Notice in the prescribed manner must be served on the appropriate
Government authority.
 4. In the absence of any agreement to the contrary, the worker employed
last must be terminated first.
THANK YOU!!!

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Industrial Disputes: Dispute Settlement Methods and Machinery

  • 2. What is an Industrial Dispute? Disputes mainly relate to the strife between employers and their employees.  According to the Industrial Dispute Act,1947 sec (2(k)), Industrial disputes mean any dispute 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 terms of employment or with the conditions of labor of any person.
  • 3. Causes of industrial Disputes: Causes of Industrial disputes may be grouped into four categories : (A) Industrial Factors (B) Managements Attitude towards workers (C) Government Machinery ; and (D) Other Causes
  • 4. Industrial Factors : Under this category, some of the causes of dispute may be : (i) An industrial matter relating to employment, work, wages, hours of work, privileges, the rights and obligations of employees and employers & terms and conditions of employment. (ii) An industrial matter in which both the parties are directly and substantially interested. (iii) Disputes arising out of unemployment, inflation, change in the attitude of employers and rivalry among unions.
  • 5. Management Attitude Towards Labor : (i) Management ‘s unwillingness to talk over any dispute with their employees. (ii) Managements unwillingness to recognize a particular trade union , delegating enough authority to the representatives etc. (iii) Unwillingness to negotiation and settlement of disputes. (iv) Managements insistence to take care of recruitments, promotion etc. without consulting the concerned employees (v) Managements unwillingness to provide services and benefits to its employee's
  • 6. Government Machinery : (a)Though there are number of enactments for promotion of harmonious relations, it is ineffective and unsatisfactory due to various reasons like their irrelevancy in the context of the challenges of present industrial climate /culture, incapability of understanding and answering imperatives of development, improper and inadequate implementation by many employers. (b) The governments conciliation machinery has settled a very negligible number of disputes .
  • 7. Other Causes : (i)Affiliation of the trade unions with a political party, where the latter may instigate the trade unions to conduct strikes, lockouts , gheraos etc. (ii) Political instability, center- state relations, sometimes result into industrial conflict. (iii) Other potential factors like corruption in industry and public life, easy money etc. can also result into industrial disputes.
  • 8. Strikes Lockouts Primary Strikes Secondary Strikes Others 1. General 2. Particular 3. Political 4. Bandhs Stay- away Strikes Sit down, Stay-in Tool Down or Pen Down Strikes Go - Slow Work To Rule Token or Protest Strikes Industrial Disputes Lightening or Cat- Call strikes Picketing & Boycott Gherao Hunger Strikes
  • 9. How to settle the disputes?? Whatever may be the cause of industrial disputes, the consequences are harmful to all stakeholders- management, employees, economy and the society . For management, disputes result in loss of production, revenue, profit, and even sickness of the plant. Employees would be hard hit as the disputes may lead to lockouts and consequent loss of wages and even jobs. Various methods are available for resolving disputes. Most important of them are :
  • 11. Collective Bargaining  A technique by which dispute as to conditions of employment, are resolved amicably, by agreement, rather than by coercion  The dispute is settled peacefully and voluntarily, although reluctantly, between labor and management.  The final outcome of bargaining may also depend upon the art, skill and dexterity of displaying the strength by the representatives of one party to the other.
  • 12. Code of Discipline  The code of discipline defines duties and responsibilities of employers and workers. The objectives of the code are: 1. To ensure that employers and employees recognize each others rights and obligations. 2. To promote consecutive co-operation between parties concerned at all levels. 3. To eliminate all forms of coercion, intimidation and violence in IR. 4. To avoid work stoppages. 5. To facilitate the growth of trade unions. 6. To maintain discipline in the industry.
  • 13. Grievance Procedure  Grievance is any discontent or dissatisfaction, arising out of employment relationship, which an employee thinks , believes or feels to be unfair, unjust or inequitable.  A grievance procedure is a formal process which is preliminary to arbitration, which enables the parties involved to attempt to resolve their differences in a peaceful and orderly manner.  It enables the company and the trade union to investigate and discuss the problem at issue without in any way interrupting the peaceful conduct of business.  When the grievance redressal machinery works effectively, it satisfactorily resolve most of the disputes between labor and management.
  • 14. Arbitration  Arbitration is a procedure in which a neutral third party studies the bargaining situation, listens to both the parties, gathers information and then makes recommendations that are binding on both the parties.  Arbitration is effective means of resolving disputes because it is : 1. Established by the parties themselves and the decision is acceptable to them. 2. Relatively expeditious when compared to courts and tribunals.
  • 15. Conciliation  Conciliation is a process by which the 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 be an individual or a group of people. 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.
  • 16. Conciliation  Conciliation officer: an authority appointed by the government to mediate disputes between parties brought to his notice; enjoying the powers of a civil court. He is supposed to give judgment within 14 days of the commencement of the conciliation proceedings.  Board of conciliation: The Board is an adhoc, tripartite body having the powers of a civil court created for a specific dispute(when the conciliation officer fails to resolve disputes within a time frame, the board is appointed)  Court of enquiry: In case the conciliation proceedings fail to resolve a dispute, a court of enquiry is constituted by the government to investigate the dispute and submit the report within six months.
  • 17. Adjudication  Adjudication means a mandatory settlement of an industrial dispute by a labor court or a tribunal. Generally, the government deems a dispute for adjudication depending on the failure of conciliation proceedings.  Section 10 of the Industrial Act, 1947, provides for reference of a dispute to labor court or tribunal.  Disputes are generally referred to adjudication on the recommendation of the conciliation officer who had dealt with them earlier. The government has a discretionary powers to accept or reject recommendations of the conciliation officer. It is obvious that once is referred for adjudication , the verdict of a labor court or tribunal is binding on both the parties.  This is the most significant instrument of resolving disputes. But, it has been criticized because of the delay involved in resolving conflicts.
  • 18. Consultative Machinery  Consultative machinery is set by the government to resolve conflicts. The main function is to bring the parties together for mutual settlement of differences in the spirit of co-operation and goodwill.  A consultative machinery operates at plant , industry , state and national levels. At plant level, there are works committee and joint management councils. Being bipartite in character, works committee are constituted as per the provisions of industrial Disputes Act, 1947 and joint management councils are set up following the trust laid down in the Industrial Policy Resolution,1956. At the industry level, there are wage boards and industrial committee.  Labor advisory boards operate at the state and at the all India level there are Indian labor conference and the Standing labor committee. The bodies operating at state and national level, are tripartite in character
  • 19. STRIKES, LOCKOUTS, LAYOFFS & RETRENCHMENT
  • 20. Strikes  Strike is one of the oldest and the most effective weapons of labor in its struggle with capital for securing economic justice.  Strike has been defined in Section 2 (q) of the Industrial Disputes Act as— “Strike means a cessation of work by a body of persons employed in any industry acting in combination, or a concerted refusal, or a refusal under a common understanding, of any number of persons who are or have been so employed to continue to work or to accept employment.”  Two main ingredients of strike are  Cessation of Work  Concerted Action
  • 21. 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, or the refusal by an employer to continue to employ any number of persons employed by him.  It is declared by employers to put pressure on their workers. It is counterpart of a strike.  Lockout may happen for several reasons. When only part of a trade union votes to strike, the purpose of a lockout is to put pressure on a union by reducing the number of members who are able to work.  Every employer has the option to lock out workers, if – a dispute has been referred to a council or the Commission for Conciliation, Mediation and Arbitration (CCMA); a certificate that a dispute remains unresolved has been issued; 30 days have elapsed since the referral; and
  • 22. Lockouts  II ) 48 hours’ written notice of a strike is given to a. the employer; or b. a council (if the dispute relates to a collective agreement to be concluded in a council); or c. to an employers’ organization (if the employer is a member of an organization that is a party to the dispute); or  III) 48 hours’ written notice of a lockout is given to a. the trade union; or b. to the workers (if they are not trade union members); or c. a council (if the dispute relates to a collective agreement to be concluded in a council)
  • 23. Layoffs  Layoff implies temporary removal of an employee from the payroll of the organization due to circumstances beyond the control of the employer.  It may last for an indefinite period. But the employee is not terminated permanently and is expected to be called back in future. The employer employee relationship does not come to an end but is merely suspended during the period of layoff. It is temporary denial of employment.  The purpose of layoff is to reduce the financial burden on the organization when the human resources cannot be utilized profitably.
  • 24. Layoffs  Under Section 2(KKK) of the Industrial Disputes Act, 1947, layoff is defined as “the failure, refusal or inability of an employer, on account of shortage of coal, power or raw materials or accumulation of stocks or breakdown of machinery or by any other reason, to give employment to a workman whose name appears on the muster rolls of his industrial establishment and who has not been retrenched”.  Layoff is restored in cyclical and seasonal industries. In mines workers are laid off due to excess of inflammable gas, flood, fire and explosion.
  • 25. Retrenchment  Retrenchment means permanent termination of service of an employee for economic reasons in a going concern.  The Industrial Disputes Act, 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 retirement either voluntary or reaching age of superannuation, or continued ill-health or the closure and winding up of a business”.
  • 26. Retrenchment  The Act lays down the following conditions for retrenchment.  1.The employee must be given one month’s notice in writing indicating the reasons for retrenchment or wages in lieu of such notice.  2. The employee must be paid compensation equal to 15 days for every completed year of service.  3. Notice in the prescribed manner must be served on the appropriate Government authority.  4. In the absence of any agreement to the contrary, the worker employed last must be terminated first.