The Industrial Disputes Act, 1947

The objective of the Industrial Disputes Act is to secure industrial peace and harmony by providing machinery and
procedure for the investigation and settlement of industrial disputes by negotiations. This act deals with the
retrenchment process of the employees, procedure for layoff, procedure and rules for strikes and lockouts of the
company.
INTRODUCTION
Industrial Disputes have adverse effects on industrial production, efficiency, costs, quality, human satisfaction,
discipline, technological and economic progress and finally on the welfare of the society. A discontent labour force,
nursing in its heart mute grievances and resentments, cannot be efficient and will not possess a high degree of
industrial morale. Hence, the Industrial Dispute Act of 1947, was passed as a preventive and curative measure.
SCOPE AND OBJECT
The Industrial Dispute Act of 1947, came into force on the first day of April, 1947. Its aim is to protect the workmen
against victimization by the employers and to ensure social justice to both employers and employees. The unique
object of the Act is to promote collective bargaining and to maintain a peaceful atmosphere in industries by avoiding
illegal strikes and lock outs. The Act also provides for regulation of lay off and retrenchment. The objective of the
Industrial Disputes Act is to secure industrial peace and harmony by providing machinery and procedure for the
investigation and settlement of industrial disputes by negotiations.

DEFINITIONS
Appropriate Government [Sec. 2(a)]: Appropriate Government means the Central Government in relation to any
industrial dispute concerning any industry carried on by or under the authority of the Central Government, any
industry carried on by a Railway Company, any controlled industry specified by the Central Government, The Unit
Trust of India. Corporations under the Central Statutes, Banking company, Insurance company. Mines. Oil field,
Cantonment board, Major ports, etc. In relation to any other industrial dispute, the appropriate Government is the
State Government.
Award [Sec 2 (b)] means an interim or a final determination of any industrial dispute or of any question relating
thereto by any Labour Court, Industrial Tribunal or National Industrial Tribunal and includes an arbitration award made
under section 10A;
Industry [Sec. 2(j)]: Industry means any business, trade, undertaking, manufacture or calling of employers and
includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen.
Industrial Dispute [Sec. 2(k)]: means 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 nonemployment or the terms of employment or with the conditions of labour, of any person.

FIRST SCHEDULE
INDUSTRIES WHICH MAY BE DECLARED TO BE PUBLIC UTILITY SERVICES UNDER SUB-CLAUSE (VI) OF
CLAUSE (N) OF SECTION 2
1.

Transport (other than railways) for the carriage of passengers or goods by land or water.

2.

Banking.

3.

Cement.

4.

Coal.

5.

Cotton textiles.

6.

Foodstuffs.

7.

Iron and steel.

8.

Defence establishments.

9.

Service in hospitals and dispensaries.

10. Fire brigade service.

11. India Government Mints.
12. India Security Press.
13. Copper Mining.
14. Lead Mining.
15. Zinc Mining.
16. Iron Ore Mining.
17. Service in any oil field.
18. Omitted
19. Service in uranium industry.
20. Pyrites mining industry.
21. Security Paper Mill, Hoshangabad.
22. Services in Bank Note Press, Dewas.
23. Phosphorite mining.
24. Magnesite Mining.
25. Currency Note Press.
26. Manufacture or production of mineral oil (crude oil), motor and aviation spirit, diesel oil, kerosene oil, fuel oil,
diverse hydrocarbon oils and their blends including synthetic fuels, lubricating oils and the like.
27. Service in the International Airports Authority of India.
28. Industrial establishments manufacturing or producing Nuclear Fuel and Components, Heavy Water and
Allied Chemicals & Atomic Energy.

2(k) "industrial dispute" means 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 nonemployment or the terms of employment or with the conditions of labour, of any person;
Settlement [Sec. 2(p)]: Settlement means a settlement arrived at in the course of conciliation proceeding and
includes a written agreement between an employer and a workman arrived at otherwise than in the course of
conciliation proceeding where such agreement has been signed by the parties thereto in such manner as may be
prescribed and a copy thereof has been sent to an officer authorised by the Appropriate Government and the
Conciliation Officer.
Wages [Sec. 2(rr)]: Wages mean all remuneration capable of being expressed in terms of money, which would, if the
terms of employment, express or implied were fulfilled, be payable to a workman in respect of his employment or of
the work done in such an employment and includes:
(i) such allowances (including dearness allowance) as the workman is for the time being entitled to;
(ii) the value of any house accommodation, or of supply of light, water, medical attendance or other amenity or of any
service or of any concessional supply of food grains or other articles;
(iii) Any traveling concession. But the following are excluded:
(a) Any bonus.
(b) Any contribution paid or payable to any pension fund or provident fund, or for the benefit of the workman under
any law for the time being in force.
(c) Any gratuity payable on the termination of his service.

2(n) "Public utility service" means (i) any railway service or any transport service for the carriage of passengers or goods by air;
(ia) any service in, or in connection with the working of, any major port or dock;
(ii) any section of an industrial establishment, on the working of which the safety of the establishment or the workmen
employed therein depends;
(iii) any postal, telegraph or telephone service;
(iv) any industry which supplies power, light or water to the public;
(v) any system of public conservancy or sanitation;
(vi) any industry specified in the First Schedule which the appropriate Government may, if satisfied that public
emergency or public interest so requires, by notification in the Official Gazette, declare to be a public utility service for
the purposes of this Act, for such period as may be specified in the notification

DISPUTE SETTLEMENT AUTHORITIES UNDER THE ACT

The I.D. Act provides elaborate and effective machinery for the investigation and amicable settlement of industrial
disputes by setting up the various authorities. These are:
1.

Works Committee;

2.

Conciliation Officer;

3.

Conciliation Board;

4.

Court of Enquiry;

5.

Labour Court;

6.

Industrial Tribunal;

7.

National Tribunal;

8.

Arbitrators;

9.

Grievances Settlement Authority.

DISMISSAL, ETC., OF AN INDIVIDUAL WORKMAN TO BE DEEMED TO BE AN INDUSTRIAL DISPUTE. [Sec

2A]
Difference in between the workman and his employer connected arising out of following activities shall be deemed to
the industrial dispute.

Dismissal of workman

Discharge of workman

Retrenchment of the workman

Termination of workman from his services

[Sec 2A (2)]
Workman having the disputes can make a application to the conciliation officer to settle the dispute. After the expiry of
3 months of time conciliation officer fails to settle the dispute, workman can make a direct application to labour courts
or tribunals for adjudication.
[Sec 2A (3)]
Workman should make an application to labour courts or tribunals for adjudication before the expiry of 3 years from
the date of discharge, dismissal, retrenchment or otherwise termination of service of workman,
WORKS COMMITTEE [Sec. 3]: In the case of an industrial establishment in which 100 or more workmen are
employed, the appropriate Government may require the employer to constitute a 'Work Committee'. It consists of
equal number of representatives of employers and workmen engaged in the establishment. The representatives of
the workmen shall be chosen from amongst the workmen engaged in the establishment and in consultation with the
registered trade union, if any. Works committee deals with the workers problem arising day to day in the industrial
establishment.
CONCILIATION OFFICER [Sec. 4]: The appropriate Government is empowered to appoint any number of persons,
as it thinks fit, to be conciliation officers. The conciliation officer having duty of mediating and acts as the mediators in
between the parties to resolve the dispute.
In the case of public utility services matters like strikes and lockouts the conciliation officer can initiate the conciliation
proceeding ad tries to settle the dispute in between the parties.
If the conciliation officer fails to resolve the dispute between the parties, he should report to the appropriate
government. If necessary the dispute shall be referred to the Board, Labour Court, Tribunal or National Tribunal, by
the appropriate government. [Sec 12 (5)]

Duties of conciliation officers. [Sec 12]

Hold conciliation proceedings relating to Strikes and lockouts procedural matters of public utility services.

Investigate the matters of the disputes.

Conciliation officers shall induce the parties to come to a fair and amicable settlement of the dispute.

Duty to send the report of settlement of dispute and memorandum of the settlement signed by the parties to
the dispute to the government or his superior.

In case of failure of settlement of dispute in between parties, duty to send them to the government or his
superior, report of facts and circumstances relating to the disputes and in his opinion, a settlement could not
be arrived at,

Duty to send the report to the government or his superior within 14 days from the commencement of the
proceeding. or within such shorter period as may be fixed by the appropriate Government .

CONCILIATION BOARD [Sec. 5]: as occasion arises appropriate Government is also authorised to constitute a
Board of conciliation for promoting the settlement of an industrial dispute. It consists of a chairman who shall be an
independent person, and two or four other members. The members appointed shall be in equal numbers to represent
the parties to the dispute. On the dispute being referred to the Board it is the duty of the Board to do all things as it
thinks fit for the purpose of inducing the parties to come to fair and amicable settlement.
If there are many parties relating to or in the dispute the government may appoint the conciliation board consisting of
the above said members
According to [Sec 10 (2)] when parties in the industrial dispute apply to the government to refer dispute to the
Conciliation Board and if government satisfies it shall make the reference to the Conciliation Board.
Duties of board. [Sec 13]

it shall be the duty of the Board to endeavor to bring about a settlement of dispute.

Investigate the matters relating to the dispute between parties and inducing the parties to come to a fair and
amicable settlement of the dispute.

In case of failure of settlement of dispute in between parties, duty to send to the government the report of
facts and circumstances relating to the disputes and board opinion, a settlement could not be arrived at,

The Board shall submit its report under this section within 2 months of the date on which the dispute was
referred to it or within such shorter period as may be fixed by the appropriate Government.

COURT OF ENQUIRY [Sec. 6]: as occasion arises, Government can initiate a Court of Inquiry. This Court of Inquiry
was to find out matters connected with or relevant to an industrial dispute. Where a Court consists of two or more
members, one of them shall be appointed as the chairman.
A Court of Inquiry looks into only matters which are referred to it by Government and submits its report to the
Government ordinarily within certain period from the date of reference.

ADJUDICATION
Labour Court [Sec. 7]: The appropriate Government is empowered to constitute one or more Labour Courts. Its
function is the adjudication of industrial disputes relating to any matter specified in the Second Schedule.

MATTERS WITHIN THE JURISDICTION OF LABOUR COURTS.

SECOND SCHEDULE
1.

The propriety or legality of an order passed by an employer under the standing orders;

2.

The application and interpretation of standing orders;

3.

Discharge or dismissal of workmen including reinstatement of, or grant of relief to, workmen wrongfully
dismissed;

4.

Withdrawal of any customary concession or privilege;

5.

Illegality or otherwise of a strike or lock-out; and

According to [Sec 10 (1) (c)] matters specified in THIRD SCHEDULE, dispute not effecting more than 100
workers can be referred to labour court.

According to [Sec 10 (2)] when parties in the industrial dispute apply to the government to refer dispute to
the labour court and if government satisfies it shall make the reference to the labour courts.

According to [Sec 10 (6)] no Labour Court or Tribunal shall have jurisdiction to adjudicate upon any matter
which is under adjudication before the National Tribunal.

A Labour Court consists of one person only. A person is qualified to be appointed as presiding officer of a Labour
Court, if:
(a) he is, or has been a judge of a High Court, or
(b) he has been a District judge or an Additional District judge for at least three years, or
(c) he has held the office of the chairman or any other member of the Labour Appellate Tribunal or of any Tribunal for
at least two years, or
(d) he has held any judicial office in India for not less than seven years, or
(e) he has been the presiding officer of a Labour Court constituted under any Provincial Act or State Act for at least
five years.
(f) he is or has been a Deputy Chief Labour Commissioner (Central) or Joint Commissioner of the State Labour
Department , having a degree in law and at least 7 years experience in the labour department after having acquired
degree in law including three years of experience as Conciliation Officer:
(g) as the case may be, before being appointed as the presiding officer; or (g) he is an officer of Indian Legal Service
in Grade III with three years experience in the grade.

Industrial Tribunal [Sec. 7A]: The appropriate Government may, by notification in the Official Gazette, constitute
one or more Industrial Tribunals for the adjudication of industrial disputes relating to any matter, whether specified in

the Second Schedule or the Third Schedule and for performing such other functions as may be assigned to them
under this Act.

SECOND SCHEDULE
1. The propriety or legality of an order passed by an employer under the standing orders;
2. The application and interpretation of standing orders;
3. Discharge or dismissal of workmen including reinstatement of, or grant of relief to, workmen wrongfully dismissed;
4. Withdrawal of any customary concession or privilege;
5. Illegality or otherwise of a strike or lock-out; and
THIRD SCHEDULE
1. Wages, including the period and mode of payment;
2. Compensatory and other allowances;
3. Hours of work and rest intervals;
4. Leave with wages and holidays;
5. Bonus, profit sharing, provident fund and gratuity;
6. Shift working otherwise than in accordance with standing orders;
7. Classification by grades;
8. Rules of discipline;
9. Rationalisation;
10. Retrenchment of workmen and closure of establishment; and
11. Any other matter that may be prescribed.

According to [Sec 10 (2)] when parties in the industrial dispute apply to the government to refer dispute to
the industrial tribunal and if government satisfies it shall make the reference to the industrial tribunal.

According to [Sec 10 (6)] no Labour Court or Tribunal shall have jurisdiction to adjudicate upon any matter
which is under adjudication before the National Tribunal.

A Tribunal consists of one person only.

For appointment as the presiding officer of a Tribunal

he is, or has been, a Judge of a High Court; or

he has, for a period of not less than 3 years, been a District Judge or an Additional District Judge;

he is or has been a Deputy Chief Labour Commissioner (Central) or Joint Commissioner of the State Labour
Department, having a degree in law and at 7 seven years experience in the labour department after having
acquired degree in law including three years of experience as Conciliation Officer:

Provided that no such Deputy Chief Labour Commissioner or Joint Labour Commissioner shall be appointed unless
he resigns from the service of the Central Government or State Government, as the case may he, before being
appointed as the presiding officer; or he is an officer of Indian Legal Service in Grade III with three years experience
in the grade.
National Tribunal [Sec. 7 (B)]: The Central Government may, by notification in the Official Gazette, constitute one or
more National Industrial Tribunals. Its main function is the adjudication of industrial disputes which involve questions
of national importance or affecting the interest of two or more States.
According to [Sec 10 (1-A)] dispute involves any question of national importance or is of such a nature that

industrial establishments situated in more than one State, whether it relates to any matter specified in the Second
Schedule or the Third Schedule, the government will order in writing refer to National Tribunal for adjudication.
According to [Sec 10 (2)] when parties in the industrial dispute apply to the government to refer dispute to the
National Tribunal and if government satisfies it shall make the reference to the National Tribunal.
The Central Government shall appoint a National Tribunal consisting of one person only.

A person to be appointed a presiding officer of a National Tribunal must be, or

must have been, a judge of a High Court or

must have held the office of the chairman or

any other member of the Labour Appellate Tribunal for a period of not less than two years.

The Central Government may appoint two persons as assessors to advise the National Tribunal.
ARBITRATION
Voluntary reference of disputes to arbitration. [sec. 10 (a)]: an arbitrator is appointed by the Government.
Whether the dispute is before Labour Court, or Industrial Tribunal or National Tribunal, the parties can go to
arbitration by written agreement. The arbitrators conduct the investigation in to the dispute matters and give
arbitration award (final decision or settlement or decree) as for making reference of an industrial dispute. If an
industrial dispute exists or is apprehended and the employer and the workman agree to refer the dispute to an
arbitration, they may refer the dispute to an arbitration. But such reference shall be made before the dispute has been
referred under Sec. 19 to a Labour Court or Tribunal or National Tribunal by a written agreement. The arbitrator may
be appointed singly or more than one in number. The arbitrator or arbitrators shall investigate the dispute and submit
to the appropriate Government the arbitration award signed by the arbitrator or all the arbitrators, as the case may
be.
Grievance Settlement Authority [Sec. 9 (c)]: This Section is incorporated as a new chapter II B of the Act. As per
this Section, the employer in relation to every industrial establishment in which fifty or more workmen are employed or
have been employed on any day in the preceding twelve months, shall provide for, in accordance with the rules made
in that behalf under this Act, a Grievances Settlement Authority.
9C. every industrial establishment employing 20 or more workmen shall have one or more Grievance Redressal
Committee for the resolution of disputes arising out of individual grievances.

The Grievance Redressal Committee shall consist of equal number of members from the employer and the
workmen.

The chairperson of the Grievance Redressal Committee shall be selected from the employer and from
among the workmen alternatively on rotation basis every year.

The total number of members of the Grievance Redressal Committee shall not exceed more than 6:
Provided that there shall be, as far as practicable, one woman member if the Grievance Redressal
Committee has two members and in case the number of members is more than two, the number of women
members may be increased proportionately.

The Grievance Redressal Committee may complete its proceedings within forty-five days on receipt of a
written application by or on behalf of the aggrieved party.

The workman who is aggrieved of the decision of the Grievance Redressal Committee may prefer an appeal
to the employer against the decision of Grievance Redressal Committee and the employer shall, within one
month from the date of receipt of such appeal, dispose off the same and send a copy of his decision to the
workman concerned.

Nothing contained in this section shall apply to the workmen for whom there is an established Grievance
Redressal Mechanism in the establishment concerned.

AWARDS (decree) [Secs 16, 17, 17A]

The award of a Labour Court or Tribunal or National Tribunal shall be in writing and shall be signed by its
presiding officer. [Sec 16(2)].

Every arbitration award and every award of a Labour Court, Tribunal or National Tribunal shall, within a
period of 30 days from the date of its receipt by the appropriate Government, be published in such manner
as the appropriate Government thinks fit. [Sec 17(1)].

The award published shall be final and shall not be called in question by any Court in any manner
whatsoever. [Sec 17 (2)].

An award (including an arbitration award) shall become enforceable on the expiry of thirty days from the
date of its publication [Sec 17A (1)].

where the award has been given by a National Tribunal, that it will be inexpedient (not advisable or not
practicable) on public grounds affecting national economy or social justice to give effect to the whole or any
part of the award, the appropriate Government, or as the case may be, the Central Government may, by
notification in the Official Gazette, declare that the award shall not become enforceable on the expiry of the
said period of thirty days. [Sec 17A (1) (b)].

The appropriate Government or the Central Government may, within 90 days from the date of publication of
the award under section 17, make an order rejecting or modifying the award, to legislature of sate or
parliament [Sec 17A (2) ]. And if no pursuance has made, the order become enforceable after the expiry of
90 days. [Sec 17A (3)].

Any award as rejected or modified laid before legislature of state or parliament, shall become enforceable on
the expiry of 15 days from the date on which is so laid. [Sec 17A (3)].

Award declared becomes enforceable on the specified date if mentioned, if no date mentioned award
becomes enforceable according to above rules.

PERIOD OF OPERATION OF SETTLEMENTS AND AWARDS. [Sec 19]

A settlement shall come into operation on such date as is agreed upon by the parties to the dispute, and if
no date is agreed upon, on the date on which the memorandum of the settlement is signed by the parties to
the dispute.

An award shall remain in operation for a period of one year from the date on which the award becomes
enforceable under section 17A: Provided that the appropriate Government may reduce the said period and
fix such period as it thinks fit :

the appropriate Government may, before the expiry of the said period, extend the period of operation by any
period not exceeding one year at a time as it thinks fit, so however, that the total period of operation of any
award does not exceed three years from the date on which it came into operation.

Eg: if the court orders the employer to reinstate the workman in case of unreasonable removal or discharge , the
employer is bind over for one year or in some cases, the period specified ny the courts

STRIKES AND LOCKOUTS

Strike [Sec. 2 (q)]: Strike means "a cessation of work by a body of persons employed in any industry acting in
combination or a concerted 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". Mere stoppage of work does not come within the
meaning of strike unless it can be shown that such stoppage of work was a concerted action for the enforcement of
an industrial demand.
Lockout [Sec. 2(1)]: Lockout means "the temporary 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". Lockout is the antithesis
of strike.

It is a weapon of the employer while strike is that of the workers.

Just as a strike is a weapon in the hands of the workers for enforcing their industrial demands, lockout is a
weapon available to the employer to force the employees to see his points of view and to accept his
demands.

The Industrial Dispute Act does not intend to take away these rights.

However, the rights of strikes and lockouts have been restricted to achieve the purpose of the Act, namely
peaceful investigation and settlement of the industrial disputes.

PROCEDURE OF STRIKES
According to Sec. 22(1)
Worker should follow the rules mentioned below for doing strike. The rules are as follows
(a) Issue of notice of strike is mandatory;
(b) The date of strike must be within 6 weeks from the date of issue of strike notice;
(c) The day of strike must not be within 14 days from the date of notice;
(d) There should be no strike on any day before the date specified in the strike notice;
(e) There should be no strike during the pendency of conciliation proceedings and 7 days after the conclusion of said
proceedings;
Facts [+]
New Delhi,2012: Air India pilots was called for strike on May 7 and continued till July 3, is the second longest strike
Indian aviation history, has caused loss of Rs. 600 crores to Air India Management. The reasons behind
commencement of strike by Air India pilots were irregularities and non-payment of salaries to pilots by Air India
management. On this reason few pilots were dismissed from the services for not attending their duties to run flights
and for causing loss to the management and Air India management approached the Delhi High Court requesting it to
consider as illegal strike by pilots. Delhi High Court supported Air India management and declared it as illegal strike
on the grounds of not following the procedure of strike. On July 4 Delhi High Court gave them 48 hours to join duty

and asked the management to consider their grievances. Pilots on strike have agreed to join duties and also
demanded to reinstate dismissed pilots into the services.
PROCEDURE OF LOCKOUTS
According to Sec. 22(1)
Worker should follow the rules mentioned below for doing Lockouts. The rules are as follows
(a) Issue of notice of lockout is mandatory;
(b) The date of lockout must be within 6 weeks from the date of issue of strike notice;
(c) The day of lockout must not be within 14 days from the date of notice;
(d) There should be no lockout on any day before the date specified in the strike notice;
(e) There should be no lockout during the pendency of conciliation proceedings and 7 days after the conclusion of
said proceedings;
According to Sec. 22 (3) the notice of lock-out or strike under this section shall not be necessary where there is
already in existence a strike or, as the case may be, lock-out in the public utility service,

ILLEGAL STRIKES AND LOCK-OUTS [Sec 24]

A strike or a lockout shall be illegal, if employers or worker who ever disobeys or fails to follow the rules [Sec 22, 23,
10(3), 10-A (4-A)] for commencing strikes or lockout, those strikes and lockout are said to illegal.
General Prohibition of Strike, and Lockouts [Sec. 23]: No workman who is employed in any industrial
establishment shall go on strike in breach of contract and no employer of any such workman shall declare a lock-out
in the following circumstances.
(a) during the pendency of conciliation proceedings before a Board and seven days after the conclusion of such
proceedings;
(b) during the pendency of proceedings before a Labour Court, Tribunal or National Tribunal and two months after the
conclusion of such proceedings;
(c) during the period of operation of a Settlement or Award in respect of any of the matters covered by the Settlement
or Award.
No notice of strike and lockout is necessary in industrial establishments except in public utility services.

Strike

lockout

Workers shall do the strike.

Employer or owner shall do the lockout.

Workers do the strike because of the

grievance and for its solution.

Owners do the Lockout because of the

disputes between owners and workers.

Prior notice should be given by the

worker to the owner of the factory.

Prior notice should be given by the owner

of the factory to the worker.

Threat to go on strike:- in State of Bihar v. deodhar Jha (All India Reporter 1958 Patna. 51), the Patna High Court
examine the point as to whether or not threat go on strike is illegal. the court said that the actual resorting to strike

cannot always be illegal, therefore threat to go strike is not illegal.

UNFAIR LABOUR PRACTICES
FIFTH SCHEDULE
I - On the part of employers and trade unions of employers
1. To interfere with, restrain from, or coerce, workmen in the exercise of their right to organise, form, join or assist a
trade union or to engage in concerted activities for the purposes of collective bargaining or other mutual aid or
protection, that is to say, (a) threatening workmen with discharge or dismissal, if they join a trade union;
(b) threatening a lock-out or closure, if a trade union is organised; and
(c) granting wage increase to workmen at crucial periods of trade union organisation, with a view to undermining the
efforts of the trade union at organisation.
2. To dominate, interfere with or contribute support, financial or otherwise, to any trade union, that is to say :(a) an employer taking an active interest in organising a trade, union of his workmen; and
(b) an employer showing partiality or granting favour to one of several trade unions attempting to organise his
workmen or to its members, where such a trade union is not a recognised trade union.
3. To establish employer-sponsored trade unions of workmen.
4. To encourage or discourage membership in any trade union by discriminating against any workman, that is to
say :(a) discharging or punishing a workman, because he urged other workmen to join or organise a trade union;
(b) discharging or dismissing a workman for taking part in any strike (not being a strike which it deemed to be an
illegal strike under this Act);
(c) changing seniority rating of workmen because of trade union activities;
(d) refusing to promote workmen to higher posts on account of their trade union activities;
(e) giving unmerited promotions to certain workmen with a view to creating discord amongst other workmen, or to
undermine the strength of their trade union;
(f) discharging office bearers or active members of the trade union on account of their trade union activities.
5. To discharge or dismiss workmen (a) by way of victimisation;
(b) not in good faith, but in the colourable exercise of the employer's rights;
(c) by falsely implicating a workman in a criminal case on false evidence or on concocted evidence;
(d) for patently false reasons;
(e) on untrue or trumpet up allegations of absence without leave;

(f) in utter disregard of the principles of natural justice in the conduct of domestic enquiry or with undue haste;
(g) for misconduct of a minor or technical character, without having any regard to the nature of the particular
misconduct or the past record of service of the workman, thereby leading to a disproportionate punishment.
6. To abolish the work of a regular nature being done by workmen, and to give such work to contractors as a measure
of breaking a strike.
7. To transfer a workman mala fide from one place to another, under the guise of following management policy.
8. To insist upon individual workmen, who are on a legal strike to sign a good conduct bond, as a precondition to
allowing them to resume work.
9. To show favouritis or partiality to one set of workers regardless of merit.
10. To employ workmen as "badlis" casuals or temporaries and to continue them as such for years, with the object of
depriving them of the status and privileges of permanent workmen.
11. To discharge or discriminate against any workman for filing charges or testifying against an employer in any
enquiry or proceeding relating to any industrial dispute.
12. To recruit workmen during a strike which is not an illegal strike.
13. Failure to implement award, settlement or agreement.
14. To indulge in acts of force or violence.
15. To refuse to bargain collectively, in good faith with the recognised trade unions.
16. Proposing or continuing a lock-out deemed to be illegal under this Act.
II - On the part of workmen and trade unions of workmen
1. To advise or actively support or instigate any strike deemed to be illegal under this Act.
2. To coerce workmen in the exercise of their right to self-organisation or to join a trade union or refrain from joining
any trade union, that is to say
(a) for a trade union or its members to picketing in such a manner that non-striking workmen are physically debarred
from entering the work places;
(b) to indulge in acts of force or violence or to hold out threats of intimidation in connection with a strike against nonstriking workmen or against managerial staff.
3. For a recognised union to refuse to bargain collectively in good faith with the employer.
4. To indulge in coercive activities against certification of bargaining representative.
5. To stage, encourage or instigate such forms of coercive actions as willful "go slow", squatting on the work premises
after working hours or "gherao" of any of the members of the managerial or other staff.
6. To stage demonstrations at the residences of the employers or the managerial staff members.
7. To incite or indulge in willful damage to employer's property connected with the industry.
8. To indulge in acts of force or violence or to hold out threats of intimidation against any workman with a view to
prevent him from attending work.

LAY-OFF AND RETRENCHMENT

Lay-off [Sec. 2(kkk)]: Lay-off means "the failure, refusal or inability of an employer on account of shortage of coal,
power or raw materials or the accumulation of stocks or the breakdown of machinery or for any other reason to give
employment to a workman whose name is borne on the muster rolls of his industrial establishment and who has not
been retrenched".
Retrenchment [Sec. 2(oo)]: Retrenchment means the termination by the employer of the service of a workman for
any reason whatsoever otherwise than as a punishment indicated by way of disciplinary action.
RIGHTS OF WORKMAN LAID OFF FOR COMPENSATION [Sec. 25C]
A workman who is laid off is entitled to compensation only if he complies with the following conditions:
(i) He must not be a badli or a casual workman.

"Badli workman" means a workman who is employed in an industrial establishment in the place of another workman
whose name is borne on the muster rolls of the establishment,
(ii) His name must be borne on the muster rolls of the industrial establishment.
(iii) He must have completed at least one year of continuous service.
(iv) A worker is entitled to lay-off compensation for the period of his lay off other than for weekly holidays which may
intervene.
(v) The rate of compensation must be equal to 50% of the total of the basic wage and dearness allowance that might
have been payable to him.
(vi) No compensation can be claimed for more than forty-five days during the period of twelve months.

WORKMEN LAID OFF NOT ENTITLED TO COMPENSATION [Sec. 25E]

No compensation shall be paid to a workman who has been laid off:
(i) if he refuses to accept any alternative employment in the same or any other establishment belonging to the same
employer situated in the same town or village or within a radius of five miles and it does not require any special skill
or previous experience, provided the same wages are offered,
Facts [+]
India. Aug 2012: Uninor one of the telecom service providers laid off its 2000 employees in different states like
Karnataka, Tamil Nadu, Kerala and Orissa. company searched to find for alternative employment in its competitor
companies for its retrenched employees, to get it done Uninor appointed a outsourcing agency to help them and
arrange to help desks to assist to clinch the employees in finding jobs. in fact this is the procedure to be followed and
the Industrial Dispute Act 1947, but company claimed that it has adopted a unique human resource model.
November 2012: Tata steel in the United Kingdom had laid-off nearly 900 employees due to drop in demand for
steel in the European market. The company proposed to provide assistance to its laid-off of employees in finding jobs
at similar organisations with the coordination of its trade unions and the government.
source: Times of India, 24,Nov,2012

(ii) if he does not present himself for work at the appointed time during normal working hours at least once a day,
(iii) if lay off in the consequence of strike or slowing down of production by the workers in another part of the
establishment.
DIFFERENCE BETWEEN THE LAY-OFF AND LAID- OFF

Laid-off

Lay-off

A person who is temporarily removed for

the work being attended

Temporary stoppage of the running

factory by the owner of the establishment
or factory.

A company which declares lay-off,

Lay-off is implemented due to shortage
worker/ workers shall be laid-off from the of the raw material, break-down of
work
machinery etc.
The laid-off compensation shall be
payable to worker for 45 day only

After 45 days of lay-off, management

can retrench worker.

CLOSE DOWN ANY UNDERTAKING [Sec 25FFA]

An employer who intends to close down an undertaking shall serve, at least 60 days before the date on
which the intended closure.

a notice, is required to give to the appropriate Government stating clearly the reasons for the intended
closure of the undertaking.

Provided that nothing in this section shall apply to

An undertaking in which less than 50 workmen are employed, or less than 50 workmen were employed on an
average per working day in the preceding twelve months. An undertaking set up for the construction of buildings,
bridges, roads, canals, dams or for other construction work or project.
RETRENCHMENT OF WORKER
Section. 25C
If lay-off exceeds 45 days only the management or owner can retrench the workers by following below said rules.
The reason for compelling and restricting 45 days period of lay-off before doing retrenchment of employee
is.
lay-off is considered to be a unique situation created by reasons beyond the control of employer, it is supposed to be
a temporary situation contingent on the grounds mentioned in the definition of layoffs in the section 2(kkk). However if
this contingency is prolonging beyond a reasonable time, say 45 days, it will be matter of serious concern both to the
employer and to employees because both of them put to a loss of 50% wages by employees and loss of earnings by
employer due to temporary stoppage of work, which employer would have earned if there was no laid-off for the
reasons mentioned in section 2 (kkk).
In the case if an employer is not able to restore the situation which compelled him to lay off employees, he can
retrench employees after the expiry of 40 days in stuff continuing layoffs.
Procedure for retrenchment [Sec. 25G]
LIFO (Last in First Out) method should be followed while retrenchment of workers, a workers who has joined last
shall be retrenched first. Further explanation junior should be retrenched first.
Conditions precedent to retrenchment of workmen [Sec. 25F]
Worker who has completed one year of service and continuing in service must be retrenched by the owner by
following rules.
1.

One month notice of retrenchment should be given to the worker by the owner.

2.

Notice should include the reasons for the retrenchment of the concerned worker.

Retrenchment Compensation [Sec 25F (b)]

Retrenchment worker can claim compensation from the worker under following procedure

15 days of salary drawn for every year of service completed

Eg: last drawn salary of worker = 10000/Number of years of service = 5 years

So, retrenchment compensation calculated as follows
Salary drawn is = 10000/- , for 15 days salary is half of the amount = 5000/- number of service years = 5. = 25000/is the retrenchment compensation.

RE-EMPLOYMENT OF RETRENCHED WORKMEN [Sec. 25H]

This Section provides priority for a retrenched workman in the case of reemployment. In case the employer proposes
to re-employ any person, he is under an obligation to offer first priority to the persons who have been retrenched.
DURING PENDENCY OF PROCEEDINGS [Sec 33]
During the pendency of any conciliation proceeding before a conciliation officer or a Board or of any proceeding
before an arbitrator or a Labour Court or Tribunal or National Tribunal in respect of an industrial dispute, employer
should not do the following

for any misconduct connected with the dispute, discharge or punish, whether by dismissal or otherwise, any
workmen concerned in such dispute,

Alter the term of contract according to standing orders.

Take action against the protected workman.

If employer wants to take above actions against the employee, employer should makes an application to a
conciliation officer, Board, an arbitrator, a Labour Court, Tribunal or National Tribunal.

PENALTIES
Sec
25U

Reasons
unfair labour practice

26

Illegal Strikes

26

Illegal Lock-Outs

Punishment
punishable with imprisonment for a term
which may extend to 6 months or with
fine which may extend to 1000/- rupees
or with both.
punishable with imprisonment for a term
which may extend to one month, or with
fine which may extend to 50/- rupees, or
with both.
punishable with imprisonment for a term
which may extend to one month, or with
fine which may extend to one 1000/-

27

28

Any person who instigates or

incites others to take part in, or
otherwise acts in furtherance of, a
strike or lock-out which is illegal
under this Act,
Giving Financial Aid To Illegal
Strikes And Lock-Outs

30

Disclosing Confidential
Information

30A

Closure of establishment Without

Notice

31

contravenes the provisions of

section 33

rupees, or with both.

punishable with imprisonment for a term
which may extend to 6 months, or with
fine which may extend to one 1000/rupees, or with both.
punishable with imprisonment for a term
which may extend to 6 months, or with
fine which may extend to 1000/- rupees,
or with both.
Punishable with imprisonment for a term
which may extend to 6 months, or with
fine which may extend to 1000/- rupees,
or with both.
punishable with imprisonment for a term
which may extend to 6 months, or with
fine which may extend to 5000/- rupees,
or with both.
Punishable with imprisonment for a term
which may extend to 6 months, or with
fine which may extend to 1000/- rupees,
or with both.