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Industrial Law

Arbitration: It is a process where a neutral third party hears to the parties in disputes, gather the
information regarding the dispute, and then come to conclusion and decide the matter which is
binding on both the parties.
The difference between both the officers as, conciliator only assists the parties to conclude to a
settlement, whereas the arbitrator hears to both the parties and then passed his judgment.
Pros and cons of Arbitration in Industrial Disputes
It is established by the parties and therefore both parties have conveyed their faith in the process of
Nature is a flexible and informal process.
The concept is based on mutual consent of the parties and hence, therefore, it helps for healthy
industrial functions and relations.
Delay for settlement of disputes often occurs.
The arbitration process is expensive and all the expenses are to be incurred by both labours and the
management equally.
When the arbitrator becomes biased and if he is incompetent then the Judgment becomes arbitrary.
Powers of Labour Courts, Tribunals and National Tribunals to give appropriate relief in case
of discharge or dismissal of workmenWhere an industrial dispute relating to the discharge or dismissal of a workman has been
referred to a Labour Court, Tribunal or National Tribunal for adjudication,
and, in the course of the adjudication proceedings, the Labour Court, Tribunal or National
Tribunal, as the case may be, is satisfied that the order of discharge or dismissal was not
it may, by its award, set aside the order of discharge or dismissal,
and direct reinstatement of the workman on such terms and conditions,
if any, as it thinks fit, or give such other relief to the workman including the award of any
lesser punishment in lieu of discharge or dismissal as the circumstances of the case may
Provided that in any proceeding under this section the Labour Court, Tribunal or National
Tribunal, as the case may be, shall rely only on the materials on record and shall not take
any fresh evidence in relation to the matter.
• The term "collective bargaining" was first used in 1891 by Beatrice
Webb, a founder of the field of industrial relations in Britain.It refers
to the sort of collective negotiations and agreements that had existed
since the rise of trade unions during the 18th century.
• Collective bargaining is a process of negotiation between employers
and a group of employees aimed at agreements to regulate working
salaries, working conditions, benefits, and other aspects of workers'
compensation and rights for workers.
• The collective agreements reached by these negotiations usually set
out wage scales, working hours, training, health and
safety, overtime, grievance mechanisms, and rights to participate in
workplace or company affairs
• Collective bargaining is a fundamental right. It is rooted in the ILO
Constitution and reaffirmed as such in the 1998 ILO Declaration on
Fundamental Principles and Rights at Work .
• Collective agreements may also address the rights and responsibilities
of the parties thus ensuring harmonious and productive industries
and workplaces. Enhancing the inclusiveness of collective bargaining
and collective agreements is a key means for reducing inequality and
extending labour protection.
• Definition of collective bargaining- negotiation between an employer
and a labor union usually on wages, hours, and working conditions
National Engineering Industries ... vs State Of Rajasthan And Ors, 1999
• Settlement
and collective bargaining is always to be preferred for ft is the best
guarantee of industrial peace which is the aim of all legislations for
settlement of labour disputes. In order to bring about such a settlement
more easily and to make it more workable and effective it may not be
always possible or necessary that such a settlement is arrived at in the
course of conciliation proceeding which may be the first step towards
resolving the industrial dispute which may be lingering between the
employers and their workmen represented by their unions but even if at
that stage such settlement does not take place and the industrial dispute
gets referred for adjudication, even pending such disputes, the parties can
arrive at amicable settlement which may be binding to the parties to the
settlement unlike settlement arrived at during conciliation proceedings
which may be binding not only to the parties to the settlement but even to
the entire labour force working in the organisation concerned even though
they may not be members of the Union which might have entered into
settlement during conciliation proceedings".
industrial Dispute-Sec. 2 (k)
Parties to the dispute who may be
Employers and workmen
Employers and Employers
Workmen and workmen
a) There should be a factum of dispute not merely a difference of opinion.
b) It has to be espoused by the union in writing at the commencement of
the dispute. Subsequent espousal will render the reference invalid.
Therefore date when the dispute was espoused is very important.
• c) It affects the interests of not merely an individual workman but several
workmen as a class who are working in an industrial establishment.
• d) The dispute may be in relation to any workman or workmen or any other
person in whom they are interested as a body.
• Chandrakant Tukaram Nikam and others vs. Municipal Corporation
of Ahmedabad and another[i]: It was held by the Supreme Court that
the Jurisdiction of the Civil Court was impliedly barred in cases of the
dismissal or removal from service, The appropriate forum for such
relief was one constituted under Industrial Disputes Act, 1947.
• Jadhav J. H. vs. Forbes Gobak Ltd.[ii]: In this case, it was held that, a
dispute relating to a single workman may be an industrial dispute if
either it is espoused by the union or by a number of workmen
irrespective of the reason the union espousing the cause of workman
was not the majority of the union.
Individual Dispute Becomes An Industrial Dispute?
• Before insertion of Section 2-A of the Act an individual dispute could
not per se be an industrial dispute, but it could become one if taken
up by the Trade Union or a number of workmen. The Supreme Court
and majority of Industrial Tribunals held that, a dispute raised by a
dismissed employee would not be treated as an industrial dispute,
unless it is supported by a trade union or by a body or Section of
• For an individual dispute to be declared as an Industrial Dispute, the
following conditions are to be satisfied:
• A body of workmen (trade Union ) or a considerable number of
workmen, are found to have made common cause with the individual
• That the dispute (individual dispute) was taken up or sponsored by
the workmen as a body (trade union) or by a considerable Section of
them before the date of referenc
Bombay Union of Journalists vs. The Hindu
[iii] 1961, II LLJ 727 Bom
• A person working in ‘The Hindu, Madras’ was terminated for claiming as
full time employee. The Bombay Union of Journalist raised the dispute. It
was found that, there were ten employees of which seven in administrative
side and only three in journalism side. Of these three, only two were the
members of the union. Therefore, the Supreme Court held that the
Bombay Union of Journalists is not competent to raise this dispute. Even if
it had raised, it could not have become an industrial dispute.
Workmen of Indian Express Newspapers Ltd. vs. Management
Indian Express Newspapers AIR 1970, SC 737
• A dispute relating to two workmen of Indian Express Newspapers Ltd,
was espoused by the Delhi Union of Journalists which was an outside
union. About 25 percent of the working journalists of the Indian
Express were members of that union. But there was no union of the
journalists of the Indian Express. It was held that the Delhi Union of
Journalists could be said to have a representative character Qua the
working journalists employed Indian Express and the dispute was
thus transformed into an industrial dispute
Section 2-A I.D ACT 1948
• provides that “where any employer discharges, dismisses, retrenches
or otherwise terminated the services of any individual workman, any
dispute or difference between that workman and his employer
connected with, or arising out of such discharge, dismissal,
retrenchment or termination shall be deemed to be an industrial
dispute, notwithstanding that no other workman nor any union of
workmen, is a party to the dispute.”
• Any workman may make an application directly to the labour court or
Industrial Tribunal for adjudication of such dispute after the expiry of 3
months when an application was made before the conciliation officer. This
has been done to prevent inordinate delay.
• The said application however should be made within 3 years of the date of
dismissal, discharge, retrenchment or termination of service.
• The court shall proceed to hear the matter as if it was referred to it U/S 10
of the ID Act.
• when a dispute is connected with a discharged, dismissed retrenched
or terminated workman that it shall be treated as an industrial
dispute. If the dispute or difference is connected with some other
matter e.g. payment of bonus/ gratuity etc. then it would have to
satisfy the test laid down in judicial decisions.
AWARD- Section 2(b) of the Industrial Dispute
• According to Section 2(b) of the Industrial Disputes Act, 1947 ‘Award’
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.
• The judgment of an arbitrator is called his Award. Award (Judgement)
of Arbitrators under section 10A is an Award.
Ingredients of Award •
To constitute Award under Section 2(b) of the Industrial Dispute
Act, 1947 the following ingredients are to be satisfied (a) An Award is an interim or final determination of an industrial
(b) It is an Interim or final determination of any question relating to
such dispute.
(c) Such interim or final determination is made by any Labour Court,
Industrial Tribunal or National Industrial Tribunal.
(d) Award (Judgement) of Arbitrators under section 10A is an Award.
What is Settlement According to Section 2 (p) of the Industrial Dispute Act, 1947
“Settlement” means a settlement arrived at in the course of
conciliation proceeding and includes a written agreement between the
employer and workmen 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 in this behalf by the
appropriate Government and the conciliation officer.
Works Committee :
• ection 3 of the Industrial Dispute Act,1947 provides for the
constitution of Works Committees.
The expression 'Works
Committee' denotes "A committee comprising of representatives
from both the parties (for example employer and their employees) to
the Dispute. The appropriate government is empowered to prescribe
that works committee should be constituted in every industrial
establishment employing 100 or more workers.
• The main purpose of creating the Works committee is to develop a
sense of partnership between the employee and his workmen
Constitution of Works Committee
• (1) In the case of any industrial establishment in which one hundred
or more workmen are employed or have been employed on any day
in the preceding twelve months, the appropriate Government may by
general or special order require the employer to constitute in the
prescribed manner a Works Committee consisting of representatives
of employers and workmen engaged in the establishment so however
that the number of representatives of workmen on the Committee
shall not be less than the number of representatives of the employer.
The representatives of the workmen shall be chosen in the
prescribed manner from among the workmen engaged in the
establishment and in consultation with their trade union, if any,
registered under the Indian Trade Unions Act, 1926 (16 of 1926).
Duties and Functions of the Works Committee
• It shall be the duty of the Works Committee to promote measures for securing and preserving amity
and good relations between the employer and workmen and, to that end, to comment upon matters
of their common interest or concern and endeavor to compose any material difference of opinion in
respect of such matters.
• Dealing with the scope of functioning of the Works committees, it was held in Kemp and Co. Ltd
Vs. Their workmen ( 1955) L.L.J. 48 (L.A.T) that the Institution of works committee has been provided
in the rules passed under the Industrial Dispute Act in order to look after the interest of the workmen.
They are normally concerned with the problems arising in the day to day working of the grievance of
the employees and to arrive at some agreement also. But the functions and the responsibility of the
Works Committee as their very nomenclature indicates cannot go beyond the recommendations and
as such, they are no more or less bodies who in the first instance endeavor to compose the
Dissolution of the Works Committee
• The Central Government or any officer authority to whom the power
under Section 39 has been delegated, may, after making necessary
enquiry, dissolve any works committee at any time, by an order in
writing provided it or he is a satisfied the committee has not been
constituted in the accordance with the rules or that not less than
2/3rd of the number of representatives of workmen have without any
reasonable justification, failed to attend three consecutive meetings
of the committee or that the committee has ceased to function for
any other reason, thus defeating the very purpose for which this