Labour Law

Outline the impact of industrial jurisprudence on labor welfare legislations.

Explain the factors which where responsible for departure from the old theory
of Master and Servant

During the twentieth century a new branch Of jurisprudence known as Industrial Jurisprudence has
developed in our country. Industrial jurisprudence, is a development of mainly post-independence
period although its birth may be traced back to the industrial revolution. Before independence it existed
in a initial stage in our country. The growth of industrial jurisprudence can significantly be noticed not
only from increase in labor and industrial legislations but also from a large number of industrial law
matters decided by the Supreme Court and High courts. It affects directly a considerable population of
our country consisting of industrialists, workmen and their families. Those who are affected indirectly
constitute a still larger bulk of the country's population. This branch of law modified the traditional law
relating to master and servant and had cut down the old theory of laissez faire based upon the 'freedom
of contract' in the larger interest Of the society because that theory was found wanting for the
development of harmonious and amicable relations between the employers and employees. Individual
contracts have been in many respects substituted by a standard form of statutory contract through
legislation and judicial interpretation. The traditional right of an employer to hire and fire his Workmen
at his will has been subjected to many restraints. Industrial Tribunals can by their award make a contract
which is binding on both the parties' creating new right and imposing new obligations arising out of the
award. There is no question of the employer agreeing to the new contract, it is binding even though it is
unacceptable to him. The creation of new obligations is not by the parties themselves. Either or both of
them may be opposed to it, nevertheless it binds them. Thus, the idea of some authority making a
contract for the workmen and employer is a strange and novel idea and is foreign to the basic principle
of the law of contract.

Similarly there is change in the concept of master and servant. One who invests capital is no more a
master and one who puts in labor is no more a servant. They are employer and employees, the former
may hire the latter but he can no more fire them at his will. The interest of the employees is in many
respects protected by legislation. Both are now parties in an enterprise, without one yielding to the
higher status of another but as co-sharer in the partnership. Even the right of labor participation in the
management has been given legislative recognition to the utter despair of the capitalist. Most of the
benefits claimed by a workman are not part of his bargain with the employer when the latter employed
 him or are not due to them on account of any contract but of" status". The industrial society all over the
world has been moving during the present century from contract to status and this status is a politico-
socio-economic juristic status.

What were the factors that lead to this departure from the old theories of the law of contract, and the
law of Master and Servant ? Industrialization in India, as in other countries, brought with it some new
socio-economic problems. Those who control the industry have a natural tendency of multiplying their
wealth and if this tendency is not checked the rich grows on richer and the poor becomes poorer day by
day. The gap between the rich and the poor ultimately grows on to this extent that it develops into two
distinct classes in any industrial society, a few of whom are 'Haves' and others are 'Have-nots'. This
economic disparity leads to a struggle between 'Haves' and 'Have-nots', the latter exploited. Although
this situation continues for some time and it had continued to be so in our country too, but gradually
the workmen realized that they could put a better fight if they get united. This realization was closely
followed by a period of industrial unrest leading to strikes and lock-outs. In conditions so disturbed the
world has witnessed the horrors of the two world wars resulting in spiral rise in the cost of living. With
the rise in the cost of living there has been consistent demand from labor for increase in wages.
Democratic ideas have also grown simultaneously with the growth of industrialization in our country.
These democratic ideas have pleaded for and have also helped in mass awakening and consciousness for
greater power amongst the working class. Out of the struggle between workers, demanding for better
share in the production and profit of the industry and the employers' hesitation to part with it beyond a
certain . limit, have grown the recognition of certain principles which are considered to be fundamental
in almost all developed countries of the world.

The basic principles are :

1. The right of workmen to combine and form associations or unions.

2. The right of workmen to bargain collectively for the betterment of their conditions of service.

3. The realization that economic struggle is inevitable because it is but natural that labor would agitate for
better conditions.

4. A shift from the doctrine of "laissez faire" to a "welfare state".

5. Tripartite consultations i.e., solution of the industrial or labor disputes through the participation of
workers, employers and the Government.

6. The State can no more be a neutral onlooker but must interfere as the protector of the social good.

7. Minimum standards must be guaranteed through State legislation.

The concept of industrial jurisprudence in our country developed only after independence. Until
independence the change in attitude of the government and the benevolent labor legislation only aimed
at amelioration of the conditions of labor and it could hardly be said to be a deal in social justice to the
working class. The birth of industrial jurisprudence in our country may be ascribed to the Constitution of
India which made more articulate and clear the industrial relations philosophy of the Republic Of India.
This philosophy has afforded the broad and clear guidelines for the development of our industrial
jurisprudence and has thus taken India one step forward in her quest for industrial harmony. The
Parliament and the Supreme Court have helped in shaping industrial jurisprudence, the former through
legislation and the latter as interpreter of the labor laws.

Industrial jurisprudence is of great importance to all developed or developing countries of the world
because it is concerned with the' study of problems relating to human relations arising out Of a large
scale development Of factory' system which has emerged in consequence of industrial revolution.
Proper regulation of employer-employee relationship is a Condition precedent for planned, progressive
and instrument of social policy in the Purposeful present day development body-politic the role of any
society of industrial' an jurisprudence has still gained importance. Industrial workers and their families
are directly concerned with it.

In spite of its Widening scope it cannot be forgotten that its application is limited in certain respects. For
example, there are still a vast majority of the people who in their relationship are still governed by the
ordinary law of contract based on laissez faire doctrine. Industrial jurisprudence is a developing concept.
It derives its main strength from social justice which is dynamic and changing. The concept of social
justice itself changes with the social, economic and political changes in society. Therefore, it has yet to
take its final shape. Industrial jurisprudence cannot, with all its high ideals, displace general
jurisprudence just as no amount of social justice can abrogate altogether the concept of legal justice.
Even while dispensing social justice the Courts, tribunals and arbitrators, whoever it may be, cannot
ignore the law. Therefore, It would be correct to say that industrial jurisprudence is a species of the
same genus jurisprudence and industrial jurisprudence in relation to industrial society stands in the
same way just as general jurisprudence in relation to the total society.
 Elucidate labor Policy in India.

After independence it was largely felt that the labour -policy must emphasize upon self-reliance on the
part of the workers. Since independence till 1954, the period When V.V. Giri was the Labor Minister, all
official pronouncements emphasized that labour should become self-reliant. An equally forceful view
had been to prefer reliance upon the Government. This cross-current of approach to the labour policy
gave place to a new approach known as "Tripartism". Thus 'Tripartism' became the central themes in
the so-called "Nanda-period" That began in 1957. During this period the Government paid reliance on
three party approach, namely the trade union representing the workers, the employers, and the
Government. In this kind of approach the representatives do not decide anything but their ,role is
mainly advisory. They meet together, discuss the points in dispute and strive to reach a consensus and if
they agree they make recommendations. Out of the three, the role of the Government is more
important. Annual Labour Conferences and the permanent standing Labour Committees served as the
chief instrument of Tripartism. These conferences advocated, amongst many things; workers'
participation in management, workers' education, works committees, and minimum wage legislations.
At the sixteenth conference held in 1958 a momentous advancement was made by adopting a Code of
Discipline in industry. The Code pledged the parties to avoid strikes and lock-outs without notice, and to
eschew unilateral actions, and to rely on settlement of disputes by discussion by voluntary arbitration or
by adopting to such measures as the law may provide It also pledged them to avoid coercion and
victimization, to avoid partial strikes and lock-outs, and to follow grievance procedure.

Tripartism is an approach which lays stress on the identity of interests between labour and capital i.e.,
they are the partners in the maintenance of production and the building up of the national economy.
The labour policy has proceeded on a realization that the community as a whole, as well as individual
employers are under an obligation to protect the welfare of workers and to secure to them their due
share in the gains of economic development. This led to enacting of the Payment of Bonus Act, 1965
which aimed at providing for the payment of bonus on the basis of profits or on the basis of production
or productivity.

1. The main postulates of labor policy may be summed up as follows .

2. Recognition of the State as the custodian of the interests of the community, as the catalyst of "change"
and welfare programs.

3. Recognition of the right of workers to peaceful direct action if justice is denied to them.

4. Encouragement to mutual settlement, collective bargaining and voluntary arbitration.

5. Intervention by the State in favor of the weaker party to ensure fair treatment to all concerned.

6. Primacy to maintenance of industrial peace,

7. Evolving partnership between the employer and employees in a constructive endeavor to promote the
satisfaction of the economic needs of the community in the best possible manner.

8. Ensuring fair wage standards and provisions of social security.

9. Co-operation for augmenting 'production' and increasing 'productivity'.

10. Adequate enforcement of legislation.

11. Enhancing the status of the worker in industry,

12. Tripartite consultation.

Discuss briefly the impact of industrial revolution of India upon workmen.

Industrialization in India as in any other country implies the growth of a factory system with employers
and wage earners in varying circumstances and with varying characteristics, yet having some common
features and it is the common features that are of interest. As a consequence of the introduction of
factory system production became concentrated in a few selected places, resulting in the increase of
labor population at all such places. The village workers migrated to the industrial towns because of the
difficulty of finding adequate livelihood in their native place. This resulted in disappearance of the
popular village handicraft system because they could not Compete with machine made goods. The
goods produced on a mass scale with the help of machines in the industries were cheaper than the
goods produced by handicraft method. But the development of industry in India brought with it a great
evil inasmuch as it changed the status of a craftsman into wage-earner. Therefore, the craftsmen had to
migrate from village to industrial cities in search of employment in factories.

Evils of Industrialization

The factory system had some inherent evils to which the factory workers were exposed in the beginning.
These may be divided into two heads, namely, economic and social.
 Economic Evils

1. The artisan who in the handicraft system had the psychological satisfaction of producing the goods
himself became in the factory system only a tender of the machine. He had to produce the goods with
the help of tools and raw materials supplied by his employer and in the workshop of the employer. In
the factory system of production only a part of goods were produced by a certain category of Workers.
Different categories of workers produced different parts of the same goods. Thus, the goods came in the
final shape by the composite labor of many categories of workers. The workman in this system, did not
get full psychological satisfaction of manufacturing a product by himself2 and this indirectly arrested his
mental development and creative talents.

2. The wages paid to factory workers were quite inadequate to meet their barest needs in the new
environment which was different from their rural life.

3. The employment of factory workers was not secure in the beginning. They had to suffer occasionally
from periodic unemployment and under-employment as a consequence Of over-production or trade
cycles. A worker could be discharged by his employer at any time without assigning any reasons
therefor.

Social Evils

1. The factories were sick not only of economic evils but also of social evils. Overcrowded cities with
insanitary slums, and acute housing shortage because of large scale migration of village population to
industrial towns had its natural effect on health, morality and social life of workers.

2. Work in factories was very hazardous and strenuous with long hours duty, no rest, and no facility for
recreation. Machines were taken care of by the factory owner who had little regard for the safety and
welfare of the workers.

3. Workers were exposed to serious accidents because machines were not properly screened. Accidents
were considered as normal risk incidental to employment in a factory and the worker who was
unfortunate victim of an accident lost his employment had no right to compensation.
4. The wages paid to the workers were very low. Wages were the only source of their income. The workers
found it extremely difficult to live with the wages so earned by them. Therefore, they had to find out
ways and means to supplement their earnings. Consequently the wives and children of workmen started
seeking employment. The factory owners exploited this situation and employed them in large numbers
at extremely low wages without any regard to their physical conditions.

The workers found it difficult to adjust with these conditions. These evils of industrialization and the lack
of adjustment and harmonious relationship between the employer and the created problems in the
industry, which we Call labor problems.

Labor Problems

Labour problems constituted a serious menace to the society, and needed solution, if not to eradicate
then at least to mitigate them in the very beginning. Employers paid their sole attention to the
maintenance of machines and the improvement of the technical know how to the utter neglect of the
human hands employed to man the machines because they were readily available and could be easily
replaced. Workers were illiterate and poor and therefore unconscious of their rights. ; The socio-
economic status of the workers was far below the status of their employer. As such they could not
exercise their free will in negotiating with the employer for employment. The employer taking
advantage of the poor condition of the workers dictated their own terms and condition with regard to
wages, hours of work, leave, etc. The workers were left with no choice but to accept such terms because
service was the sole means of earning their livelihood.

Neither the Government nor the law courts took special notice of these problems because they laid too
much emphasis on the policy of the non-interference and freedom of contract. Thus, with the lapse of
time the situation turned out to be so worse and the -society became so much adversely affected that
the Government was compelled to take some action to remedy these problems.

Ultimately some philanthropic agencies like Servants of India Society, Social Service League and some
industrial social workers raised their voice against these problems. 'They were successful in mobilizing
the public opinion in support of their view point. Workers also started to form their own organization to
fight against exploitation at the hands of industrialists. In the beginning effort of the workers was not
very successful because of their weak bargaining power and lack of resources on which they could rely
for their livelihood in the absence of wages.
Some employers also realized the seriousness of the problem and the necessity of mitigating these evils
for they affected the production of the industry, they felt that investment on labor welfare was a policy
worth pursuing because a contended worker would produce better yields and would increase the
efficiency.

The Government too later on realized the gravity of the problem and could not remain a spectator for
the workers constituted a large section of the society. Moreover, the government had to intervene to
settle the disputes in the interest of national economy and the welfare of the society at large? If some
key industry is thrown out of gear, the whole system is paralyzed. Frequent break downs of even a part
of the economic system tend to impoverish the community. The prevention of industrial strife thus
assumes an important role in national policy and the State, therefore, cannot afford to remain
indifferent to the problems leading to industrial conflict.

After independence the national government paid much attention to the improvement of the conditions
of labour in industry, for the prosperity of a country depends upon the development and growth of
industry. No industry can flourish unless there is industrial peace and co-operation 2 Industrial peace is
possible only with the co-operation of labour and capital. To ensure better co-operation the wage
earner who is a partner in the production should be allowed to have his due share of the profit for
increased production. Therefore, we have to shape our economic policy in such a manner as to give
labourer his due status by offering him reasonable working conditions and due share in production. That
means social justice and social security has to be restored to the labourer. Our Constitution guarantees
social justice to the people of India. Social justice means achievement of socio-economic objectives.
Labour legislation is one of the most progressive and dynamic instruments for achieving socio-economic
progress. "There is no other branch of law which embraces such a wide and effective role in social
engineering and social action. It is here that the industrial law distinguishes itself from other branches of
law and awaits the development Of wholly different jurisprudence to explain and expound it".

Explain briefly importance of Industrial Relation.

An industry is a social world in miniature. Industries help in production and provide employment to the
people of society. Different categories of human elements are involved in an industry. The relations of
these groups inter se constitute the subject matter of industrial law. Industrial relations play a vital part
in the establishment and maintenance of industrial democracy. The economic activity is the central field
of industrial relations. The economic system of any nation affects the industrial relations, which in turn
affects the social order. A man has to struggle with his environment for earning his bread and
satisfaction of his material wants. Industrial revolutions are nothing more than the struggle of men for
their material Satisfaction. The industrial revolutions create an imbalance in the society as they
prejudicially affect the rights and interests of those sections who work in such industries but do not
control it. It results in inequitable distribution of wealth because means of production are controlled by
the dominant section of the society, who exploit the labor to their own maximum benefit. It is because
of these far reaching consequences of the imbalance and disorder in industrial relations and because of
the fact that it affects such a large and varied complex of group relationship that it was soon realized
that the very existence of the State as protector of the community and as arbitrator of conflicting
interests may be jeopardized if it was not to intervene in industrial matters to maintain social morality
which was necessary for a healthy social order. Economic progress is also bound up with industrial
peace. Industrial relations are, therefore, not a matter between employers and employees alone, but a
vital concern of the community which may be expressed in measures for the protection of its larger
interest. State intervention is also justified to prevent exploitation of the weaker section of the society
by the stronger section. Industry owners are not the only party to be blamed for the industrial disorder,
but the State whose duty it is to establish a just social order is equally to be blamed. Social justice
requires that the State for its own existence owes an obligation to the community to bridge the gap
between the two classes and evolve a healthy social order. It is from this fountain of social justice that
the necessity of legal regulation of industrial relations has flown.

The scope of governmental legal regulation of the industrial relations depends upon the socio-economic
objective that State seeks to attain and these would be reflected in the socio-economic planning and
national labour policy. It is further conditioned by the degree of the existing social imbalance which
needs social re-adjustment and the conceived picture of ideals which feed the programme of social
justice in the given socio-economic situation! We in our country are mainly embarking upon industrial
and technological advancement. But mere technological advance will widen the social imbalance.
Advancement of knowledge of social science is necessary for reshaping social relationship. Therefore,
the State must endeavor to promote studies and researches in sciences which will help in reshaping
social relationship in accordance with the principles of social justice and socio-economic objectives.

What are the principles underlying labor legislations?

Labor legislation Principles in any country of Labor should Legislation be based on the principles Of social
justice, social equity, international uniformity and national economy.

Social justice

Social justice implies two things. First equitable distribution of profits and other benefits of industry
between industry owner and workers. Secondly, providing protection to the Workers against harmful
effects to their health, safety and morality. In the beginning, the position of a Worker was that of a daily
wage-earner, which means he was paid only for the days he actually worked. A workman was expected
to accept all the hazards connected with his work as incidental to his employment. Until the passing of
Workmen's Compensation Act, 1923 no compensation was paid in case of an accident taking place in the
course Of employment. But the Workmen's Compensation Act, 1923 guarantees to workmen
compensation for any injury caused by an accident arising out of and in the course of employment. The
Minimum Wages Act, the Factories Act and the Payment of Wages Act are a few other legislations based
on the principle of social justice. These legislations fix the hours of work, make provision for payment of
over-time, leave rules, safety, health and welfare of labor in industry. Labor welfare in our country has a
special significance for our Constitution provides for the promotion of welfare of people, for humane
conditions Of work and securing to all workers full employment of leisure and social and cultural
opportunities.1 The word 'social justice' is neither defined in any Of the labor legislations nor does it
occur in any of them except the Industrial Disputes Act, 1947.

Concept of social and economic justice is a living concept of revolutionary import, it gives sustenance to
the rule of law and meaning and significance to the idea of welfare State". The Indian Constitution
enshrines the concept of social justice as one of the objectives Of the State. Article 38 of the
Constitution provides that "the State shall strive to promote the welfare of the people by securing and
protecting as effectively as it may, social order in which justice, social, economic and political, shall
inform all the institutions of the national life". Article 39 ordains that it shall be the duty of the State to
apply certain principles of social justice in making laws.

Social justice is justice according to social interest. So far as the application of the doctrine of social
justice in the sphere of adjudication is concerned, it is subordinate to the fundamental rights and law
contained in the Constitution. Secondly, it is also subservient to the statutory Industrial law. Thirdly,
social justice cannot be done in disregard of law laid down by the Supreme Court. Social justice does not
mean doing everything for the welfare of labour to the utter disregard of the employer. The balance of
social justice leans neither side. The labour policy of a country should, in the national interest, prevail
over the rival economic policies in cases of conflicts.

"Social justice" is designed to undo the injustice of unequal birth and opportunity, to make it possible
that wealth should be distributed as equally as possible and to provide that men shall have the material
things of life should be guaranteed to each man. President Roosevelt has rightly said that "there are
some whose adverse circumstances made them unable to obtain the mere necessities of existence
without the aid of others. To these less fortunate men and women, aid must be given by government
not as a measure of charity but as social duty". This duty is to be performed by the society through the
State. Social justice, therefore, is dealing equitably and fairly not between individuals but between
classes of society; the rich and the poor.
The concept of social justice has become an integral part of industrial law. It is founded on the basic idea
of socio-economic equality and its aim is to assist the removal of socio-economic disparities and
inequalities. The Constitution of India has also affirmed social and economic justice to all its citizens.
Although a number of legislation have been passed with that end in view but still some more important
measures need to be taken. Provisions relating to fundamental rights .and directive principles of state
policy provide sufficient guarantee against exploitation. Social justice has thus been made object of state
policy and governmental action. Social justice though not defined in our Constitution, means attainment
of the socio-economic objectives by removing existing evils and enacting new legislation to achieve
these objectives.

The concept of social justice is not narrow or limited to a particU1ar 'branch of legislation or
adjudication although it is more prominent and conspicuous in industrial legislation and adjudication. Its
sweep is comprehensive and is founded on the basic ideal of socio-economic equality and it aims at
assisting the removal of socio-economic disparities and inequalities of birth and status and endeavours
to resolve the competing claims especially between employers and workers by finding a just, fair and
equitable solution to their human relation's problem so that peace, harmony and co-operation of the
highest order prevails amongst them which may further the growth and progress of nations.

Social justice is different from legal justice. The difference is not of objective but aim at dispensing
justice. The difference is due to two reasons : (i) Social justice aims at doing justice between classes of
society, and not between individual, (ii) the method which -it adopts is unorthodox compared to the
methods of municipal law. Justice dispensed according to the law of Master and Servant, based upon
the principle of absolute freedom of contract and the doctrine of laissez faire, is legal justice. Social
justice is something more than mere justice, it is a philosophy super-imposed upon the legal systems.

Social equity.

Any legislation which is based on social justice prescribes a definite standard for adoption in future. Such
standard is fixed after taking into account the past and present circumstances. Once a standard is so
fixed by legislation it remains in force until it is changed or modified by another legislation passed in
conformity with the legislative procedure. No discretion is given to change such law to the authority
administering such law. However, where it is felt that the law should be flexible and should be changed
as the circumstances and conditions change, the law empowers the Government to make such changes.
This is generally done by giving the Government rule making power under the provisions of the Act.
When power under the Act is given to the Government the rules may be modified to suit the changed
conditions. Such legislation is said to be based on social equity.

Discuss the importance of industrial disputes legislation and a brief note on its
history of Industrial disputes legislations in India.

Labour legislation in India grew with the growth of industry. In the eighteenth century India was not only
a great agricultural country but a great manufacturing country too. Asian and European markets were
mainly fed by the looms supplied by India. But the British Government in India as a matter of policy
discouraged Indian manufacturers in order to encourage the rising manufacturers of England. Their
policy was to make India subservient to the industries of Great Britain and to make Indian people grow
only raw materials. The British oppression in India continued for time which led to the growth of Indian
nationalism and to a vigorous renaissance. Nationalism has an obvious economic aspect which in our
country was reflected in the urge for economic reforms and for industrialization.

In the twentieth century the national movement took a new turn and there was a common demand for
the Indian goods. A non-co-operation movement which is known as swadeshi movement was started
which urged upon the people to use goods made in India and to boycott foreign goods. The non-co-
operation movement synchronized With periods Of economic crisis gave impetus to industrialization.
Not only that, growth Of Indian private sector owes much to these popular movements. No doubt, the
Indian Economists, drew their inspiration from British classical Economists but they outgrew those ideas
3 Like British Economists, Indian Economists not only advocated that the trade and commerce should be
free but they laid emphasis on the free trade Of local goods. An attempt was made to put forward a
theory of economic development and planning suited to conditions of our Country. After thirties
planning was accepted by the national movement as its economic ideology. Thus, planned
industrialization became our main goal.

In India, the plantation industry in Assam was the first to attract legislative control. The method of
recruitment of workers in this industry was full of hardships. Workers were employed through
professional recruiters. Workers were not allowed by the planters to leave the tea gardens. A number of
Acts were passed from 1863 onwards to regulate the recruitments. These legislations protected more
the interests of the employers than safeguarding the interest of the workers. The Factories Act was
passed in 1881 and the Mines Act in 1901.
But the most important of such Acts as Were passed to protect the interest the workers was the
Workmen's Compensation Act, 1923. Some other important social security legislations are : the
Employees' State Insurance Act, 1948, the Employee's Provident Funds Act, 1952 and the Maternity
Benefit Act, 1961. Laws were also made to regulate the labour management relations. Some of them
are : the Industrial Disputes Act, 1947, the Trade -Unions Act, 1926 and the Industrial Employment
(Standing Orders) Act, 1946. Labour legislations ensuring labour welfare and minimum standards were
also enacted. Some of them are : the Factories Act, 1948, the Minimum Wages Act, 1948, The Payment
Of Wages Act, 1936 and the Payment of Bonus Act, 1965.

In India, a number Of labour legislations have been enacted to promote the condition of the labor
keeping in view the development of industry and national economy. But for industrial - regeneration it is
necessary that the partners of the industry must cure their respective defects. Since independence both
legislation and public opinion have done a lot to better the condition of the workers but unfortunately
the employers have not responded very appreciably. It is high time that the employers must realize that
it is their privilege as a citizen of a democratic country to relinquish their acquisitive tendencies of the
past and set a new ideal for the future of the country. At the same time it is the duty of the workers and
their organizations to improve the work-efficiency and help in securing better production resulting in
greater profits and prosperity of the industry to be ultimately shared by the management, workers and
the community at large. The employers should concede to workers a representative voice in the control
of the industrial system. "Workers are the dominant partners in the industrial undertakings and without
their co-operation and good work, discipline, integrity and character, the industry will not be able to
produce effective results or profits. However efficient the machine touch if any industry may be, if the
human element refuses to co-operate, the industry will fail to run. Therefore, the profit of the industry
must be shared between employers, Workers and the community; the workers having a dominant
share, being the producers of wealth. The Government and the factory owners must fully understand
the labor psychology and a change in their outlook and attitude is desired to secure the industrial peace.
Nothing should be done under threat or Coercion must but on be a clear given. understanding Industry
owners that whatever should treat is good the and workers is due as to co-partners the labour Similarly,
"workers in the country must understand fully that if they desire to secure their due place in the
industrial economy of the country they must think more in terms of responsibilities and duties and not
interpret independence for impertinence and liberty for licence. Sabotage and violence of all kinds and
bitterness in thought, word and deed must be eschewed. Then alone a Socialist Democracy is possible in
this country and industrial relations of a higher order can be maintained for the benefit of the country
and the community".
Explain Industrial Adjudication.

Social and economic justice is ultimate ideal of industrial adjudication and the basis lies in the guiding
principles of social welfare, common good and the directive principles of State policy enshrined in the
Constitution.

The essential function of industrial adjudication is to assist the State by helping a solution of industrial
disputes. Therefore, it has broadly to go by the social and economic policy followed by the State.

The twin objectives of any industrial adjudication are industrial peace and economic justice. The former
implies restoration Of industrial peace and goodwill in industry so as to establish harmony between
labor and capital.

Latter industrial economic implies harmony progress that of helps the in Community boosting industrial
production and peace strengthen and which goodwill national would help should economy in be general
economic progress of the community and strengthen national economy. The latter implies that
restoration of industrial peace and good will should be on a fair and just basis. Injustice, social or
economic' is bound to result in exploitation of labour, inequality of incomes, concentration of wealth in
a few hands capitalism and class conflict.

Democratic socialism is the cherished goal Of our nation. The acceptance of socialism necessarily adopts
a social planning which will sub serve the interest of society as against individuals or vested classes. All
national institutions must have their base on the tenets of socialism.

Social philosophy of the age must also be considered. The concept of welfare State has thrown the
doctrine Of laissez faire in background. The theory of 'hire and fire' as well as the theory Of 'supply and
demand', which were allowed free scope under the doctrine of laissez faire, are no longer in practice
now. In settling industrial issues the question Of propriety and impropriety, fairness and unfairness are
taken into account.

Industrial adjudication must also promote and assist the national economy. Therefore, it becomes
necessary that no award should run counter to the labor policy in a planned economy. With that end in
view formulation of a rational labour policy becomes most important. A national labor policy must aim
at achieving maximum economic welfare, which requires that (i) the national income shall be
maximized, (ii) it shall be divided equally among all the members of the economy, and (iii) it shall be
stable in the sense of being free from violent fluctuations.

The following are some of the guiding principles of industrial adjudication :

Public interest :

Since industrial adjudication aims at promoting social and economic justice and social and economic
justice rests on serving the interest of society as a whole, therefore, industrial adjudication must also
subserve the public interest. However, public interest is not defined in our industrial law. Public interest
are claims or demands or desires involved in life in a politically organized society asserted in title of that
organization.

Industrial harmony and goodwill :

Whatever be the system of economy, stress in invariably laid on increased productivity, wherein only
lies the hopes of increased national wealth. Interested productivity depends on the existence of
conditions of harmony and goodwill in industry and workers. Peace and goodwill in industry involve not
only absence of industrial conflict and peace is not merely a negative but also a positive concept.
Industrial adjudication, therefore, must bear this consideration in solving industrial issues.

For industrial harmony mutual understanding and co-operation between several interests which take
part in the process of production is essential. This will depend upon fair dealing and establishment of
good working conditions. For industrial peace, acceptance of trade unionism is necessary. Some have
advocated even of acceptance of labour organizations as part of an' emerging system of representative
government in the sphere of industrial relations.

Development of industrial justice.

Lasting peace in any industry is possible only when an attempt is made to eliminate the real causes of
conflict. Therefore, restoration of peace with justice is necessary. Both social and economic justice are
essential for obtaining whole hearted co-operation of labour in the task of production. For labor co-
operation equitable distribution of the gains is necessary.

The principle of equality should also be taken into consideration. Social justice requires equal work and
equal pay for men and women and equality of opportunity, etc. Equality in economic order is said to be
an indispensable part of social justice because it is equality in economic life that sets the process of
social inequality, political weakness and evolution of community with superior and inferior classes.4
Justice requires acceptance of the principle of equality.

Justice also lies in adjustment of rival claims in a fair and just manner. In the case of industrial
adjudication the claims for the employer based on the freedom of contract have to be adjusted with the
claims of industrial employees for social justice. The task of making a reasonable adjustment, is not
always easy, and so, in reaching conclusions in such a matter it is essential not to decide more than is
necessary, If industrial adjudication purports to lay down broad general principles it is likely to make its
approach in future cases inflexible and that must always be avoided.

In State of Mysore v. Workers of Gold Mines the Supreme Court also observed that : "In its attempt to
do social justice industrial adjudication has to adjust rival claims of the employer and his workmen in a
fair and just manner and this object can best be achieved by dealing with each problem as it arises on its
own facts and circumstances'.

Expert assistance.

Whenever a Tribunal has before it a matter which requires expert assistance in collecting and assessing
the appropriate material as to technical matters, the Tribunal, should avail itself of such assistance. The
ultimate decision would, no doubt, rest with the Tribunal, but since the decision has to be based on
proper material, the Tribunal must not deny to itself opportunity of expert assistance in obtaining and
assessing the appropriate material.

Socio-economic effects.

While it is true that the industrial tribunals are not social or economic legislatures, it does not mean that
they should have no concern with the social and economic effects of the awards.2 If any decision IS
made without taking into consideration its socio-economic effects it may have upon industry or
community, it may lose much of its validity.

Reference to facts and circumstances of each case.

ln industrial adjudication laying down of inflexible general rules must be avoided. The more proper
approach is to bear in mind all the relevant facts which govern the case and the decision of a question
must depend upon the evaluation of all such factors.

Tribunals to act in a judicial manner.

The Tribunals must act in a judicial manner. It must ensure that all material evidence is brought to its
notice and every opportunity is given to test that evidence by effective cross-examination. It must also
consider the evidence produced before it objectively and must reach its final conclusions in a judicial
manner.

Expediency is no consideration. ( Expediency )

lt is very often impossible to arrive at just settlement of a dispute which satisfies either all or even one
of the parties to the dispute. In the true award making there is no place to expediency or opportunities,
disputes must be determined regardless of any dissatisfaction that may occur to an unsuccessful party.

Acceptability of decisions.

lt is the duty of an arbitrator or adjudicator to make an award which may be acceptable to both the
parties to be workable. He must aim at a possible compromise. He has also to keep in mind that a
decision is useless if it cannot be enforced and that the power and ability of the respective parties to
administer a decision successfully is an integral part of the decision. However, if acceptable decision
cannot be secured, the arbitrator or adjudicator owes a duty to give his award.
To sum up it may be said that in dealing with industrial dispute, the tribunals should not be unduly
influenced by academic questions of law. They should as far as possible, deal with the merits of each
case according to its facts and circumstances.

Explain scope and object and salient features of Industrial disputes Act.1947

Introduction.

During post-independence era we have witnessed the development of a new jurisprudence, namely the
'Industrial Law'. The Industrial Law in pre-independence days was in a rudimentary form. But later on
with the development of industry, the Industrial Law developed side by side. The growth of this law was
slow in the beginning but gained its pace if the recent years as is evident from the bulk of the cases
before the Supreme Court on Industrial law matters. A large section of the Indian population is affected
by Industrial Laws. Some like industrialists and their workmen are directly affected and many others are
unconsciously affected by these laws. The economic growth of a country depends upon the industrial
development. Therefore, the progress of a country being dependent upon the development of industry,
the Industrial Laws play an important role in the national economy of a country.

Section 1. Scope and object.

The object of the industrial relations legislation in general is industrial peace and economic justice. The
prosperity- of any industry very much depends upon its growing production. The production
is only possible when the industry functions smoothly without any interruptions. There are some other
factors that influence the production, namely absence of disputes, i.e., harmonious
relationship between the labor and the management. Therefore, every industrial
relations legislation necessarily aims at providing conditions congenial to the
industrial peace.

Economic justice is another objective aimed at by such legislations. Almost all interruptions in
production are due to industrial disputes. Dissatisfaction with the existing economic conditions is the
root cause of industrial disputes. The history of labor struggle is nothing but a continuous demand for
fair return to' labor expressed in varied forms, e.g., (a) increase in wages, (b) resistance to decrease in
wages, and (c) grant of allowance and benefits, etc.' If a laborer wants to achieve these gains
 individually, he fails because of his weaker bargaining power, the management with better economic
footing stands in a better position to dictate its terms. Therefore, the economic struggle of labor with
capital is fought collectively by organized labors. If the labor organizes and bargains collectively, he is
definitely placed in a position to exert - greater pressure upon the capital
to provide them fair return to their labour. It is with a view to provide economic justice by ensuring fair
return to the labour that the State as the custodian of public interest intervenes by 'State regulation'.
Economic justice has also been ensured to the people of India by our Constitution.

The Industrial Disputes Act, 1947 extends to the whole of India. It came into operation on the first day
Of April, 1947. The object of the Act as laid down in the preamble of the Act is to make provision for
the investigation and settlement of industrial disputes. The object of all labor legislations is to ensure
fair wages and to prevent disputes so that production might not be adversely affected. The principal
objects of the Act as analyzed by the Supreme Court are as follows.

1. The promotion Of measures for securing amity - and good relations between the
employer and workmen;

2. An investigation and settlement of industrial disputes between employers and employers, employers
and workmen or workmen and workmen With a right Of representation by a registered Trade Union or
Federation of Trade Unions or Association of employers or a federation of association of employers;

3. The prevention of illegal strikes and lock-outs;

4. Relief to workmen in the matter Of lay-off' retrenchment and closure of an undertaking;

5. Collective bargaining.

The Industrial Disputes Act is a progressive measure of social legislation aiming at the amelioration of
the conditions Of workmen in industry.

Main Features of the Act.

Some of the distinguishing features of the Industrial Disputes Act, 1947 may be summarized as under.
1. Any industrial dispute may be referred to an industrial tribunal by an agreement of parties to the
dispute or by the State Government if it deems it expedient - so to do.

2. An award shall be binding on both the parties to the dispute for the Specified period not exceeding one
year. It shall be normally enforced by the Government.

3. Strike and lock-outs are prohibited

I. during the pendency of conciliation and adjudication proceedings;

II. during the pendency of settlements reached in the course of conciliation proceedings; and
III. During the pendency of awards of Industrial Tribunal declared binding by the appropriate
Government.

4. In public interest or emergency the appropriate Government has power to declare the transport (other
than railways), coal, cotton textiles, foodstuffs and iron and steel industries to be a public utility service
for the purposes of this Act, for a maximum period of six months.

5. In case of lay off or retrenchment of workmen the employer is required to pay compensation to them.

6. Provision has also been made for payment of compensation to workmen in case of transfer or closure
an undertaking.

7. A number of authorities such as, Works committee, Conciliation officer, Board of Conciliation, Courts of
Inquiry, Labour Courts, Tribunal and National Tribunal are provided for settlement of industrial disputes.
The nature of powers, functions and duties of these authorities differ from each other but each one of
them plays an important role in ensuring industrial peace.

Explain the definition of Appropriate Government under Industrial Disputes

Act, 1947 with reference to decided cases

Section 2 (a) defines the term Appropriate Government. The Central Government as well as the State
Government are vested with various powers and the duties in relation to matters dealt with in this Act.
In relation to some industrial disputes the Central Government and in relation to some others the State
Government concerned are the Appropriate Government to deal with such disputes. Therefore, to avoid
repetition, it was expedient to use a phrase which may be used in the same sense in different sections of
the Act. The appropriate Government is the Central Government in relation to the following.
1. any industry carried on by or under authority of the Central Government or by a railway company or
concerning any such controlled industry as may be specified in this behalf by the Central Government;
or

2. a Dock Labor Board established under Section 5-A of the Dock Workers (Regulation of Employment) Act'
1948, or the Industrial Finance Corporation of India Limited formed and registered under the Companies
Act, 1956, or the Employees' State Insurance Corporation established under Section 3 of the Employees'
State Insurance Act, 1948, or the Board of Trustees constituted under Section 3-A of the Coal Mines
Provident Fund and Miscellaneous Provisions Act, 1948, or the Central Board of Trustees and the State
Boards of Trustees constituted under Section 5-A and Section 5-B, respectively, of the Employees'
Provident Fund and Miscellaneous Provisions Act 1952, or the Life Insurance Corporation of India
established under Section 3 of the Life Insurance Corporation Act, 1956, or the Oil and Natural Gas
Corporation Limited registered under the Companies Act, 1956, or the Deposit Insurance and Credit
Guarantee Corporation established under Section 3 of the Deposit. Insurance and Credit Guarantee
Corporation Act, 1961, or the Central Warehousing Corporation established under Section 3 of the
Warehousing Corporations Act, 1962, or the Unit Trust of India established under Section 3 of the Unit
Trust of India Act, 1963, or the Food Corporation of India established under Section 3, or a Board of
Management established for two or more contiguous States under Section 16 of the Food Corporations
Act, 1964, or the Airports Authority of India constituted under Section 3 of the Airports Authority of
India Act, 1994, or a Regional Rural Bank established under Section 3 of the Regional Rural Banks Act,
1976, or the Export Credit and Guarantee Corporation Limited, or The Industrial Reconstruction Bank of
India or The National Housing Bank established under section 3 of the National Housing Bank Act, 1987
or the Banking Service Commission established under section 3 of the Banking Service Commission Act,
1975 or an air transport service, or a banking or an insurance company, a Mine, an Oil Field, a
Cantonment Board, or a major port, any company in which not less than fifty-one percent of the paid-up
share capital is held by the Central Government, or any corporation, not being a corporation referred to
in this clause established by or under any law made by Parliament, or the Central public sector
undertaking, subsidiary Companies set up by the principal undertaking and autonomous bodies owned
or controlled by the Central Government, the Central Government, and

3. in relation to any other industrial dispute, including the State public sector undertaking, subsidiary
companies set up by the principal undertaking and autonomous bodies owned or controlled by the State
Government, the State Government:

Provided that in case of a dispute between a contractor and the contract labor employed through the
contractor in any industrial establishment where such dispute first arose, the appropriate Government
shall be the Central Government or the State Government, as the case may be, which has control over
such industrial establishment.
Whether the Appropriate Government is the Central Government or the State Government depends on
the subject-matter of the dispute. The general principle on which the broad classification Of the Central
or State authority over the industrial disputes is based is that in case Of an industry carried on by or
under the authority of the Central Government, or the industry being located in more than one State,
the Appropriate Government is the Central Government so that the problems may be conveniently and
uniformly dealt with.

In Tata Memorial Hospital Workers Union v. Tata Memorial Centre and Another,

The appellant is a trade union registered under the Trade Unions Act 1926 and employees of the first
respondent are its members. By an order of the Industrial Court, Mumbai, respondent NO. 2, Tata
Memorial Hospital Kamgar Sanghatana is another Trade Union. Application was filed by the second
respondent union for cancellation of recognition of appellant and substitution of recognition of the
second respondent union. These applications Were held maintainable by the Industrial Court and High
Court on the ground that the appropriate government for the first respondent (i.e., Employer, Tata
Memorial Centre) was State and not the Central Government. The appellant union being the recognized
union was aggrieved by the decision which led by implication to the denial of status as a recognized
union. Hence, it preferred an appeal to the Supreme Court.

The Supreme Court observed that the answer of question that State or Central Government was the
appropriate government would depend on two issues.

1. How was the property of the first respondent Centre vested?

2. Whether the control and management of the hospital and research Centre was independently with
the first respondent.

The Supreme court held that on a survey of the factual and legal scenario the property dedicated to the
first respondent vested in the governing council of the first respondent society.

With regard to second question the Supreme Court held that even in the test of control and
management, it was the first respondent which was functioning independently. The hospital and
research center could not be said to be under the control of the Central Government. In the
circumstances, the State Government had to be treated as the appropriate government for the first
respondent.

Consequently the order under appeal was set aside and the order of Industrial Court holding the
application to be maintainable but dismissing them on merits was upheld as correct.
It is, therefore, clear that on facts, for establishment in question the appropriate government was held
to be the State Government, under Section 2(a) of the Industrial Disputes Act, 1947.

In Bharat Glass works (Private) Ltd. v. state of West Bengal,' the appellant carried on an industry in the
manufacture of glass and ceramics. Their contention Was that it was a 'controlled industry' and as such
the Central Government being the Appropriate Government, the reference made by the Government of
West Bengal was bad. It was held that "an industry mentioned in the first Schedule of the Industries
(Development and Regulation) Act, 1951 is a 'controlled industry', but it is not necessarily an industry
carried on by or under the authority of the Central Government.For an industry to be carried on under
the authority of the Central Government, it must be an industry belonging to the Central Government,
i.e., its own undertaking".

In Shri Sankara Allom Ltd. v. The State of Travancore Cochin,

It was held that merely because the manufacture of salt was carried on by the company under a license
from Government, it cannot become a Government business or one carried on under authority of the
Government.

In the light of the above cases we come to the conclusion that simply because an industry is a Industry"
or the necessary licence is granted by the Central Government, the industry is not necessarily one
carried on by or under the authority of Central Government.

What this section requires is not only that the industry should be a controlled industry but also that
Central Government must specify "in this behalf" that the industry concerned is a controlled industry. In
other words, the specification be taken by the Central Government by reference to, and for the
purposes of this Act, in order that the Central Government may itself become the appropriate
Government qua such industry under this provision.

When a Banking or an Insurance Company has its branches in more than one States, the Appropriate
Government, in case of an industrial dispute relating to such company is the Central Government.
In R.P.F. Commissioner Karnataka v. Workmen;

The question for consideration was whether the Government of a State can be treated as the
'Appropriate Government" under this section in relation to any industrial dispute concerning the office
of the Regional Provident Fund Organization established by the Central Government for the State under
the Employees' Provident Fund and Miscellaneous Provisions Act, 1952. It was held that in the absence
of the State Board, the Regional Committee constituted under Paragraph 4 of the Scheme is required to
function under the control of the Central Board.

Regional Provident Fund Commissioner who is appointed by the Central Government is also under the
control of the Central Board and the Central Government, therefore, Appropriate Government in
relation to Regional provident Fund Commissioner is the Central Government.

It was held in Goa Sampling Employees' Association v. General Superintendence co. of India Pvt. Ltd.
and others, that in case of a dispute arising in Union Territory reference may be made by the Central
Government since central Government is the Appropriate Government in relation to a Union Territory.

Define award. Explain the law relating to commencement and enforceability of

an award.

According to Section 2(b) , 'Award' means an interim or final determination of any industrial dispute or
of any question relating thereto. The determination must be by any Labor Court, Industrial Tribunal, or
National Tribunal. It includes an arbitration award made under Section 10-A.

The definition of award falls in two parts. The first part covers a determination, final or interim, of any
industrial dispute. The second part takes in a determination of any question relating to an industrial
dispute. But the basic postulate common to both the parts of definition is the existence of an industrial
dispute, actual or apprehended. The "determination" Contemplated by definition is of the industrial
dispute or a question relating thereto on merits. In order to be an award a determination must be an
adjudication of a question or point relating to an industrial dispute which has been specified in the order
of reference or is incidental thereto, and such adjudication must be one on merits. Award includes final
as well as an interim determination. The tribunal can grant only such interim awards which they are
competent to grant at the time of final award, because the relief, which the Tribunal has no right to
grant at the time of final determination, shall be outside its authority at any stage of the proceedings.
 In Hotel Imperial, New Delhi v. Hotel Workers union, workmen of three hotels in New Delhi were
suspended on the charge of misconduct pending applications under Section 33. The Tribunal had
ordered these workmen to be paid their wages plus Rs. 25/- per month in lieu of food till final decision
with regard to their dismissal. On appeal the Supreme Court stayed the order Of the Tribunal on the
condition that the workmen should be paid a sum equal to half of the amount adjudged payable by the
Tribunal in respect of arrears accrued till then and continue to pay a proportionate amount till the
decision of the dispute. It was also contended that the tribunal could not adjudicate upon the question
on interim relief because it was not referred to it. But the Supreme Court did not agree with this view
because "interim relief, where it is admissible, can be granted as a matter incidental to the main
question without being itself expressed in plain terms". It was further held that ordinarily interim relief
should not be the whole relief that the workmen would get if they finally succeeded.

In this regard the following principles are noteworthy.

1. An interim award is not the final determination of some of the points involved in an industrial dispute. It
is a provisional or temporary arrangement made in a matter of urgency and subject to a final adjustment
on the final determination of a dispute.

2. Interim relief is granted in aid of the final relief to be granted. If final relief itself cannot be granted no
temporary relief of the same nature can be given. While awarding interim relief, the final adjustment to
be made at the time of the award must be kept in mind.

Finding on a preliminary issue is not an interim award. In giving retrospective effect to the awards the
tribunal should take into consideration that the Tribunal whether had on the other increases occasions,
were given referable increases to the to actual the workmen, matter of it dispute being immaterial
before the Tribunal. As observed by the Supreme Court no retrospective operation can be given to an
award for any period previous to the date on which the demands in question were made.3 In view of
Section 17 which says that a tribunal may make its award operative from any date specified in the
award, a tribunal has jurisdiction to grant an award retrospectively.4 But an Industrial Tribunal cannot
by way of interim relief direct the employer to reinstate the workman, pending the disposal Of an
application under Section 33-A.

Enforcement of an award.An award may be enforced in the following ways .

1. The aggrieved party may apply to Appropriate Government for prosecuting the defaulting party under
Section 29 or Section 31 of this Act.

2. Where any money is payable by the employer to a workman, the workman may move the Appropriate
Government for recovery of the money due to him under the award.
 3. The party in whose favor the award has been granted may file a suit ' and obtain a decree, which shall
be enforced by execution under the provisions of the Civil Procedure Code.

Where the interim order did not determine any part of the industrial dispute or any other question
relating thereto but only determined whether the Industrial Tribunal has been properly constituted to
which the industrial dispute could be referred for adjudication such order cannot be said to be an award
as defined in Section 2(b). Award of the Labor Court allowing a amount as house rent allowance to the
workers who are paid very low remuneration cannot be said to be unreasonable when financial position
of the company is sound.

Settlement.
The definition of the term "settlement" as given in Section 2(p) of the Act may be analyzed into the
following ingredients :

1. It is a settlement arrived at in the course Of conciliation proceeding. A conciliation proceeding may be

held by a conciliation officer or Board of Conciliation under this Act.

2. It also includes a written agreement between the employer and workman arrived at otherwise than in
the course of conciliation proceeding. Such a written agreement must be signed by the parties to the
agreement in the prescribed manner. A copy of the agreement must also be sent to an officer
authorized in this behalf by the Appropriate Government and the Conciliation Officer.

The definition of settlement envisages two Categories of settlements. one is a settlement which is
arrived at in the course of a conciliation proceedings and the second is a written agreement between
employer and workmen arrived at otherwise than in the course of conciliation proceeding. Where a
settlement was arrived at between the management and the association of workmen in presence of the
conciliation officer, the settlement must be regarded as one made by the association in its
representative character and, therefore, was binding on the workman.

Unless the office bearers who signed the agreement were authorized by the Executive Committee of the
union to enter into a settlement or the constitution of union contained a provision that one or more of
its members would be competent to settle dispute with the management, no agreement between any
office bearer of the union and the management can be called a settlement.
Where the representative union acts in exercise of the powers conferred by Section 20(2) Of
Maharashtra Recognition of Trade Union and Prevention of Unfair Practices Act, 1971 it is obligatory
upon it to act in a manner as not to discriminate between its members and other workmen of the
undertaking who are not its members. However, when a settlement is reached in a proceeding under
the Industrial Disputes Act in which a representative union has appeared, the same is binding on all the
workmen of the undertaking. This would mean that neither the representative union nor the employer
can discriminate between members of the representative union and Other workmen who are not
members. The benefits, advantages and disadvantages or liabilities arising out of a settlement in any
proceeding under the Industrial Disputes Act, to which the representative union is a party shall be
equally applicable to each workman in the undertaking. There shall not be a slightest trace of
discrimination between members and non-members both in regard to the advantages, and as regard
the obligations and liabilities.

In Bachi Singh and another v. union of India and another

The dispute between the union and the management was settled by the agreement arrived at before
the Conciliation Officer wherein it was stated that the Minister had assured his good offices for the
implementation of the demands and on this assurance the federation called off its agitation. It was held
that it is not a settlement and the petitioners may approach the authorities for reference of dispute
under the Act.

Define Industry and whether Hospital is an Industry?

"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.

This definition is in two parts. The first says that industry means any business, trade, undertaking,
manufacture or calling of employers and the second part provides that it includes any calling, service,
employment, handicraft, or industrial occupation or avocation Of workmen.
"If the activity can be described as an industry with reference to the occupation of the employers, the
ambit - of the industry, under the force Of the second part takes in the different kinds of
activity of employees mentioned in the second part. But the second part standing alone cannot define
industry. By the inclusive part of the definition the labour force employed in any industry is made an
integral part of the industry for the purpose of industrial disputes although industry is ordinarily
something which employers create or undertake". However, the concept that "industry is ordinarily
something which employers create or undertake" is gradually yielding place to the modern concept
which regards industry as a joint venture undertaken by employers, and workmen, an enterprise which
belongs equally to both. Further it is not necessary to view definition of industry under Section 2(j) in
two parts. The definition read as a whole denotes a collective enterprise in which employers and
employees are associated. It does not consist either by employers alone or by employees alone.3 An
industry exists only when there is relationship between employers and employees, the former engaged
in business, trade, undertaking, manufacture or calling of employers and the latter engaged in any
calling, service, employment, handicraft or industrial occupation or avocation. There must, therefore, be
an enterprise in which the employers follow their avocations as detailed in the definition and employ
workmen.6 Thus, a basic requirement of 'industry' is that the employers must be 'carrying on any
business, trade, undertaking, manufacture or calling of employers'. There is not much difficulty in
ascertaining the meaning of the words business, trade, manufacture, or calling of employers in order to
determine whether a particular activity carried on with the co-operation of employer and employees is
an industry or not but the difficulties have cropped up in defining the word 'undertaking.'

"Undertaking" means anything undertaken, any business, work or project which one engages in or
attempts, or an enterprise. It is a term of very wide denotation. But all decisions of the Supreme Court
are agreed that an undertaking to be within the definition in Section 2(j) must be read subject to a
limitation, namely, that it must be analogous to trade or business. Some working principles have been
evolved by the Supreme Court in a number of decisions which furnish a guidance in determining what
are the attributes or characteristics which would indicate that an undertaking is analogous to trade or
business.

In Bangalore Water Supply v. A. Rajappa a seven Judges' Bench of the Supreme Court exhaustively
considered the scope of industry and laid down the following test which has practically reiterated the
test laid down in Hospital Mazdoor Sabha case :

Triple Test.Where there is

(i) systematic activity,

(ii) organized by co-operation between employer and employee (the direct and substantial
element is chimerical),
(iii) for the production and/or distribution of goods and services calculated to satisfy human
wants and wishes, prima facie,

there is an "industry" in that enterprise. This is known as triple test.

The following points were also emphasized in this case .

1. Industry does not include spiritual or religious services or services geared to celestial bliss, e.g., making,
on a large scale, prasad or food. It includes material services and things.

2. Absence of profit motive or gainful objective is irrelevant, be the venture in the public, joint, private or
other sector.

3. The true focus is functional and the decisive test is the nature of the activity with special emphasis on
the employer-employee relations.

4. If the organization is a trade or business it does not cease to be one because of philanthropy animating
the undertaking.

Therefore the consequences of the decision in this case are that professions, clubs, educational
institutions co-operatives, research institutes, charitable projects and other kindered adventures, if they
fulfill the triple test stated above Cannot be exempted from the scope Of Section 2(j) Of the Act.

Dominant nature test.Where a complex of activities, some of which qualify for exemption, others not,
involve employees on the total undertaking some of whom are not workmen or some departments are
not productive of goods and services if isolated, even then the predominant nature of the services and
the integrated nature of the departments will be true test, the whole undertaking will be "industry"
although those who are not workmen by definition may not benefit by status.'

Exceptions.A restricted category of professions, clubs, co-operatives and even little research labs,
may qualify for exemption if in simple ventures, substantially and, substantively, no employees are
entertained but in minimal matters, marginal employees are hired without destroying the non-
employee character of the unit.

If in pious or altruistic mission, many employ themselves, free or for small honorarium or like return,
mainly drawn by sharing in the purpose or cause, such as lawyers volunteering to run a free legal
services, clinic or doctors serving in their spare hours in a free medical of ashramites working at the
bidding of the holiness, divinity or like central personality, and the services are supplied free or at
nominal cost and those who serve are not engaged for remuneration or on the basis of master and
servant relationship, then, the institution is not an industry even if stray servants, manual or technical
are hired. such elementary or like undertakings alone are exempt not other generosity, compassion,
developmental passion or project.
Sovereign functions, strictly understood, (alone) qualify for exemption, not the welfare activities or
economic adventures undertaken by Government or statutory bodies. Even in departments discharging
sovereign functions, if there are units which are industries and they are substantially severable, then
they can be considered to come within Section 2(j).

Cases overruled

The decisions of Supreme Court in Management safdarjung Hospital, Delhi v. Kuldip Singh, N.U.C.
Employees v. Industrial Madras Gymkhana Club Employees union v. Management-a, University of Delhi
Vs Ram Nath, Dhanrajgiri Hospital v. Workmen5 and such other rulings whose ratio runs counter to the
principles enunciated in Bangalore Water Supply v. A. Rajappa case have been overruled.

Is Municipal Corporation an Industry.

D.N. Banerjee v. P.R. Mukherjee is a leading case on the point. In this case the Budge Budge Municipality
dismissed two of its employees, Mr. P.C. Mitra, a Head clerk and Mr. P.N. Ghose a sanitary Inspector on
charges for negligence, insubordination and indiscipline. The Municipal Workers Union of which the
dismissed employees were members questioned the propriety of the dismissal and the matter was
referred to the Industrial Tribunal. The Tribunal directed reinstatement and the award was challenged
by the Municipality on the ground that its duties being connected with the local Self-government it was
not an industry and the dispute was not an industrial dispute and therefore reference of the dispute to
the tribunal was bad in law. The Supreme Court observed that in the ordinary or non-technical sense
industry or business means an undertaking where capital and labor CO-operate with each other for the
purpose of producing wealth in the shape of goods, tools etc. and for making profits. In the opinion of
the Court every aspect of activity in which the relationship of master and servant or employer and
employees exists or arises does not become an industry. There is nothing however, to prevent a statute
from giving the words 'industry' and 'industrial dispute' a wider and more comprehensive import in
order to meet the y requirements of rapid industrial progress and to bring about in the interest of
industrial peace and economy, a fair and satisfactory adjustment of relations between employers and
workmen in a variety of fields of activity.

It was further observed that 'undertaking' in the first part and industrial Occupation or avocation in the
second part of Section 2(j) obviously mean much, more than what is ordinarily understood by trade or
business. The definition was apparently intended to include within its scope what might not strictly be
called a trade or business. Neither investment of capital nor profit making motive is essential to
 constitute an industry as they are generally necessary in a business. A public utility service such as
railways, telephones, and the supply of power, light or water to the public may be carried on by private
companies or business corporations and if these public utility services are carried on by local bodies like
a Municipality they do not cease to be an industry.

For the reasons stated above Municipal Corporation was held to be an industry. Subsequently in Baroda
Borough Municipality v. Its Workmen also the corporation was held to be an industry.

Nagpur Corporation v. Its Employees is another important judicial decision on the point. In this case the
question for consideration was the meaning of the expression "analogous to the carrying on of a trade
or business" and the issue whether all the departments of a Municipal Corporation are induced in the
definition of industry. Answering the first question Supreme Court explained that as far the meaning of
'analogous to the carrying on of a trade or business' is concerned the emphasis was more on "the nature
of the organised activity implicit in trade or business than to equate the other activities with trade or
business.

The following important observations were made by the Supreme Court :

1. A Corporation is an "industry". But "industry" cannot include what are called the regal or sovereign
functions of the State. The regal functions described as "primary and inalienable functions of the State"
though delegated to a Corporation are necessarily excluded from the purview of the definition. Such
regal functions shall be confined to legislative power, administration of law and judicial power.

2. The definition cannot be confined to trade or business or activities analogous to trade or business. If a
service performed by an individual is an industry, it will continue to be so even if it is undertaken by a
Corporation. It is not necessary that the service must be trade in a different garb.

3. Neither the investment of capital, nor the existence of profit making motive is a necessary element in
the modern conception of industry. Monetary consideration for service is, therefore, not essential
characteristic of industry in a modern State.

4. If a service rendered by a Corporation is an "industry" the employees in that department connected with
the service whether financial, administrative or executive, would be entitled to the benefit of the Act.

5. If a department of a municipality discharges many functions, some pertaining to industry as defined in

the Act, and others non-industrial activities, the predominant functions Of the department shall be the
criterion for the purposes of this Act.
 The activity of the Octroi Department of Municipality is not an industry. But the
Fire Brigade service maintained by Municipal Committee is a "service" and also an 'undertaking' and,
therefore' an 'industry' within the meaning of Section 2(j) of the Act. A city Improvement Trust falls
within the definition of industry. Thus it is clear that all the departments Of the Municipal Corporation
are not industry. Which department is an industry and which is not, is to be determined by applying the
test as laid down by the Supreme Court in the case considered above.

In Permanand v. Niagar Palika, Dehradun and others,

the supreme Court held that the activity of a Nagar Palika in any of its department except those dealing
with levy of house tax etc. falls within the definition Of industry in U.P. Industrial Disputes Act, 1947.

Is hospitaI an industry.

The question whether hospital is an industry or not has come for determination by the Supreme Court
on a number of occasions and the uncertainty has been allowed to persist because of conflicting judicial
decisions right from Hospital Mazdoor Sabha case to the Bangalore Water Supply v. A. Rajappa. In state
of Bombay v. Hospital Mazdoor sabha case, the Hospital Mazdoor Sabha was a registered Trade Union
of the employees of hospitals in the State of Bombay. The services of two of its members were
terminated by way of retrenchment by the Government and the Union claimed their reinstatement
through a writ petition. It was urged by the State that the writ application was misconceived because
hospitals did not constitute an industry. The group of hospitals were run by the State for giving medical
relief to citizens and imparting medical education. The Supreme Court held the group of hospitals to be
industry and observed as follows .

1. The state is carrying on an 'undertaking' within Section 2(j) when it runs a group of hospitals for of giving
medical relief to the citizens and for helping to impart medical education.

2. An activity systematically or habitually undertaken for the production or distribution of goods or for the
rendering of material services to the community at large or a part of such community with the help of
employees is an undertaking.

3. It is the character of the activity in question which attracts the provisions of Section 2(j). Who conducts
the activity and whether it is conducted for profit or not make a material difference.
4. The conventional meaning attributed to the words, 'trade and business' has lost some of its validity for
the purposes of industrial adjudication...it would be erroneous to attach undue importance to attributes
associated with business or trade in the popular mind in days gone by.

Applying the above principles an Ayurveda College of Pharmacy manufacturing medicines for sale and
for benefit Of students of the college besides other activities of the college was held to be an industry.

Hospital Mazdoor Sabha case was overruled by Safdarjung Hospital case. But Safdarjung Hospital and
Dhanraj Giri Hospital cases have now been overruled in Bangalore Water Supply v. A. Rajappa and
Hospital Mazdoor Sabha case has been rehabilitated, Jn Management of Safilarjung Hospital, Delhi v.
Kuldip Singh8 Kurji Holy Family Hospital was held not to be an industry treatment. Similarly Safdarjung
Hospital, New Delhi and Tuberculosis Hospital, New Delhi were also held not to be industry.

Management of Hospitals Vs Their workmen it was held that

"hospital run by the Government as a part of its function is not an industry. Hospitals run by the state of
Orissa are places where persons can get treated. They are run as departments of Government. The mere
fact that payment is accepted in respect of some beds cannot lead to the inference that the hospitals
are run as a business in a commercial way. Primarily, the hospitals are meant as free service by the
Government to the patients without any profit motive'

In Kerala Ayurveda Samajam Hospital and Nursing Home, Shoranpur v. Workmen, the Ayurvedic
Institution was registered under the Registration of Societies Act. It was running a hospital, nursing
home and an Ayurvedic School.

"(i) It was engaging employees in its different departments; (ii) the institution where Ayurvedic
medicines were prepared was registered as a factory under the Factories Act; Oil) for the services,
rendered by way of treatment, fee was charged from citizens, and (iv) the establishment was organized
in-a manner in which trade or business was undertaking.

Thus on an analysis of the entire up to Bangalore Water supply case on the subject it can be said that
such hospitals as are run by the Government as part of its sovereign functions with sole object of
rendering free service to the patients are not industry, But all other hospitals, both public and private;

whether charitable or commercial would be industry if they fulfill the triple test laid down in Bangalore
Water Supply v. A. Rajappa.
Educational Institutions

In University of Delhi v. Ram Nath

The respondent Mr. Ram Nath was employed as driver by University College for women. Mr. Asgar
Mashih was Initially employed as driver by Delhi University but was later on transferred to the University
College for women in 1949. The University of Delhi found that running the busses for transporting the
girl students of the women's college has resulted in loss. Therefore it decided to discontinue that facility
and consequently the services of the above two drivers were terminated. The order of termination was
challenged on the ground the drivers were workmen and the termination of their services amounted
retrenchment. They demanded payment Of retrenchment compensation under Section 25-F of the Act
by filing petitions before the Industrial Tribunal. Tribunal decided the matter in favour of the drivers and
hence the of Delhi challenged the validity of the award on the ground that activity carried on by the
University is not industry. It was held by the Supreme Court that the work of imparting education is
more a mission and a vocation than profession or trade or business and therefore University is not an
industry. But this case has been overruled by the Supreme Court in Bangalore Water Supply case and
view of the triple test laid down in Bangalore Water Supply case even a University would be an industry
although such of its employees as are not Workmen within the meaning of Section 2(s) of the Act' may
not get the desired benefits to which a workman in an industry may be entitled to.

In Brahmo Samaj Education Society v. West Bengal College Employees' Association; the society owned
two colleges. A dispute arose between the society and non-teaching staff of the colleges. It was pleaded
that the society was purely an educational institution and not an industry because there was no
production of wealth with the Co-operation of labour and capital as is necessary to constitute an
industry. The Calcutta High Court observed that our conception of industry has not been static but has
been changing with the passage of time. An undertaking which depends on the intelligence or capacity
of an individual does not become an industry simply because it has a large establishment. There may be
an educational institution to which pupils go because Of the excellence of teachers; such institutions are
not industry. On the other hand, there may be and institution which is so organized that it is not
dependent upon the intellectual skill of any individual, but is an organization where a number of
individuals join together to render services which might even have a profit motive. Many technical
institutions are run on these lines. When again we find these institutions also do business by
manufacturing things or selling things and thereby making a profit they certainly come under heading of
"industry". These being the tests, it is clear that it will be a question of evidence as to whether particular
institution can be said to be an industry or not. arisen

In Osmania University Vs Industrial Tribunal Hyderabad a dispute having arisen between Osmania
University and its employees, the High Court of Andhra Pradesh, after closely examining the
Constitution of the University, held the dispute not to be in connection with an industry. The correct
test, for ascertaining whether the particular dispute is between the capital and labor, is whether they
are engaged in co-operation, or whether the dispute has arisen in activities connected directly with, or
attendant upon, the production or distribution of wealth.

In Ahmedabad Textile Industry's Research Association v. State of Bombay, an association was formed
for founding a scientific research institute. The institute was to carry on research in connection with the
textile and other allied trades to increase efficiency. The Supreme Court held that "though the
association was established for the purpose of research, its main object was the benefit of the members
of the association, the association is organized, and arranged in the manner in which a trade or business
is generally organized; it postulates co-operation between employers and employees; moreover the
personnel who carry on the research have no right in the result of the research. For these reasons the
association was held to be "an industry"

But a society which is established with the object of catering to the intellectual as distinguished from
material needs of men by promoting general knowledge of the country by conducting research and
publishing various journals and books is not an industry. Even though it publishes books for sale in
market, when it has no press of its own the society cannot be termed even an 'undertaking' for selling of
its publication was only an ancillary activity and the employees were engaged in rendering clerical
assistance in this matter just as the employees of a solicitor firm help the solicitors in giving advice and
service.

Since University of Delhi v. Ram Nath has been overruled by the Supreme Court in Bangalore Water
Supply v. A. Rajappa the present position is that the educational institutions including the university
are industry in a limited sense. Now those employees of educational institutions who are covered by
the definition of workman under Section 2(s) of the Industrial Disputes Act, 1947 will be treated as
workman of an industry.

It has been reaffirmed by the Punjab and Haryana High Court in Sumer Chand v. Labour Court, Ambala
and others that university is an industry and carpenter employed in university is 'workman'. The labor
Court has jurisdiction to decide the dispute relating to the termination of such a person.
Is Government Department an Industry ?

State Of Rajasthan v. Ganeshi Lal, the Labour Court had held the Law Department Of Government as an
industry, This view was upheld by the Single Judge and Division Bench of the High Court. It was
challenged by the State before Supreme Court. It was held that the Law Department of Government
could not be considered as an industry. Labour Court and the High Court have not indicated as to how
the Law Department is an industry. They merely stated that in some cases certain departments have
been held to be covered by the expression industry in some decisions. It was also pointed out that a
decision is a Precedent on its own facts. Courts should not place reliance on decisions without
discussing as to how the factual situation fits in with the fact situation Of the decision on which reliance
is placed.

Clubs.

Clubs or self-service institutions or non-proprietary member's club will be industry provided they fulfill
the triple test laid down in Bangalore Water Supply v. A. Rajappa. The Cricket Club of India case and
Madras Gymkhan Club case (discussed below) which were the two leading cases, on the point s far have
been overruled by Bangalore' Water supply case.

In Cricket Club of India v. Bombay Labour Union the question was whether the Cricket Club of India,
Bombay which was a member's club and not a proprietary club, although it was incorporated as a
Company under the Companies Act was an industry or not. The club had membership of about 4800 and
was employing 397 employees. It was held that the club was a self service institution and not an
industry and "it was wrong to equate the catering facilities provided by the club to its members or their
guests (members paying for that), with a hotel. The catering facility also was in the nature of self service
by the club to its members". This case has now been overruled.

Madras Gymkhana Club Employees' Union v. Management, is another case on this point. This was a
member's club and not a proprietary club with a membership Of about 1200. Its object was to provide a
venue for sports and games and facilities for recreation and entertainment. It was running a catering
department which provided food and refreshment not only generally but also on special occasion. It was
held that the club was a member's self-serving institution and not an industry. No doubt the material
needs or wants of a section of the community were catered but that was not enough as it was not done
as part of trade or business or as an undertaking analogous to trade or business. This case has also been
overruled. Now it is not necessary that the activity should be a trade or business or analogous to trade
or business.

It may, therefore, be submitted that both Cricket Club of India and Madras Gymkhana Club would now
be an industry because they fulfill the triple test laid down in Bangalore Water Supply case. Both are
systematically organized with the co-operation c, of employer and employee for distribution of service
to satisfy human wishes.
Solicitor's Firm or Lawyers Office.

ln N.N.UI.C. Employees v. Industrial Tribunal," the question was whether a solicitor's firm is an
industry or not. It was held that a solicitor's firm carrying on the work of an attorney is not an industry,
although specifically considered it is organized as an industrial concern, There are different categories of
servants employed by a firm, each category being assigned separate duties or function. But the service
rendered by a solicitor functioning either individually or working together with parties is service which is
essentially individual; it depends upon the professional equipment, knowledge and efficiency of the
solicitor concerned. Subsidiary work which is purely incidental type and which is intended to assist the
solicitor in doing his job has no direct relation to the professional service ultimately rendered by the
solicitor. The work of his staff has no direct or essential nexus or connection with the advice which it is
the duty of the solicitor to give to his client. There is, no doubt, a kind of co-operation between the
solicitor and his employees, but that co-operation has no direct or immediate relation to the
professional service which the solicitor renders to his client. This case has been overruled in Bangalore
"Water Supply case' and now a solicitors' firm employing persons to help in catering to the needs of the
clients is an industry.

Agricultural operation and immovable property.

The carrying on of agricultural operations by the company for the purpose of making profits, employing
workmen who contribute to the production of the agricultural commodities bringing profits to the
company, was held to be an industry within the meaning of this Clause' Where a Sugar Mill owned a
cane farm and used Its produce for its own consumption and there was also evidence that the farm
section Of the mill was run only to feed the mill, it was held that the agricultural activity being an
integral part of industrial activity, the farm section was an industry.

Position of other bodies.

A Co-operative Milk Society, an Oil Distribution Company, a Chamber of Commerce, a Partnership Firm
of Accountants, a Registered Association of Cloth Merchants, a business loading and unloading of
goods, a Pharmacy, a Dock Labor Board. a Book Shop, a Hair Cutting Saloon all are held to be 'industry
within the meaning of the term under Section 2(j) of the Act.

Define Industrial Dispute. When does an individual dispute become an Industrial dispute?
 The main objective of the Act, as pointed out in the preamble is "to make provision for the investigation
and settlement of industrial dispute". Therefore the definition of "industrial dispute" has special
significance. The following elements should exist to constitute an industrial dispute.

1. a dispute or difference between

a) employers and employers, or

b) employers and workmen, or
c) workmen and workmen;

2. the dispute or difference should be connected with

a) employment or non-employment, or
b) terms of employment, or
c) conditions of labor of any person;

3. the dispute may be in relation to any workman or workmen or any other person in whom they are
interested as a body.

The expression "of any person" appearing in the last line of Section 2(k) means that the person may not
be a workman but he may be some one in whose employment, terms of employment or conditions of
labor the workmen as a class have a true and substantial interest. Industrial dispute is not restricted to
dispute between employer and a recognized majority union. It also means a difference between
employer and workmen including a minority union.

The definition of industrial dispute does not refer to industry. But on the grammar of the expression it
must necessarily be a dispute in an industry. Moreover, the expression the 'employer' and 'workman'
used in the definition of industrial dispute carry the requirement of 'industry' in that definition by virtue
of their own defition.3 Before an industrial dispute can be raised there must be first established a
relationship of employer and employee associating together, the former following a trade or business,
etc., and the latter following any calling, service or employment, etc., in aid of the employee's enterprise
It is not necessary that there must be a profit motive but the enterprise must be analogous to trade or
business in a commercial sense. For a dispute to be industrial dispute it is necessary that a demand must
be first raised on management and rejected by them. Making of such a demand to conciliation officer
and its communication by him to management who reject the same is not sufficient to constitute
industrial dispute.
For coming into existence of an industrial dispute a written demand is not a sine qua non, unless of
course in the case of public utility service. The very words in the definition of industrial dispute in
Section 2(k) are 'dispute or difference'. The term 'industrial dispute' connotes a real and substantial
difference having some element of persistency and continuity till resolved and likely, if not adjusted, to
endanger the industrial peace of the undertaking or the community.

In Workmen of Hindustan Lever Ltd. v. Hindustan Lever Ltd.,7 the question was whether a demand to
confirm employees in an acting capacity in a grade is an industrial dispute ? It was held that a demand of
the workmen to confirm employees employed in an acting capacity in a grade would unquestionably be
an industrial dispute without anything more.

In Chandrakant Tukarnm Nikam and others v. Municipal Corporation of Ahmedabad and another, the
workmen Of the respondent Municipal Corporation had challenged orders of dismissal from service in
Civil Courts which was contested by the respondent. It was held by. the Supreme Court that the
jurisdiction of the Civil Court was impliedly barred in these cases as the dismissal or removal from
service and legality of such order being industrial dispute, the appropriate forum for such relief was one
constituted under Industrial Disputes Act, 1947.

In Thirupattur Co-operative Sugar Mills Ltd. v. S. Sivalingam, the trial Court restrained the sugar mill by
temporary injunction from implementing the proposed penalty of reduction in rank against the present
respondent. The Co-operative Sugar Mills Ltd. challenged the said order in the High Court. It was held
that the lower Court had thoroughly gone into evidence on record and allowed the application for
temporary injunction. The High Court said that there was no irregularity or infirmity in the impugned
injunction order. It was made clear that matters of dispute between employer and workman other than
the discharge, dismissal, retrenchment or termination of service are not industrial dispute under section
2(k) of the Industrial Disputes Act, 1947. Therefore remedy for such disputes lies in civil court. Only Civil
Court has jurisdiction to try the suit relating to matters other than those covered by section 2-A of the
Industrial Disputes Act.

It was held in Jadhav J.H. v. Forbes Gobak Ltd. that in order that a dispute relating to a single workman
may be an industrial dispute it must either be espoused by the union or by a number of workmen. In the
present case the individual dispute was espoused by the union. The Court also pointed out that there
was no particular form prescribed to effect such espousal. The objection in this case was that the union
espousing the cause of workman was not the majority union but that objection was rightly rejected by
the Tribunal and wrongly accepted by the High Court. The Supreme Court said that the High Court
should not have upset the finding Of the Tribunal without holding that the conclusion was irrational or
perverse.
Employment and non-employment.

Non-employment includes retrenchment as well as refusal to reinstate. The use of the word 'non-
employment' raises question, whether an employee who had been dismissed, removed, discharged or
retrenched can be re-instated by an order of the Industrial Tribunal.

In Western India Automobile Association v. Industrial the Federal Court held that:

"Re-instatement is connected with non-employment and is, therefore, within the words of the
definition, It would be curious result if the view is taken that though a person discharged during a
dispute is within the definition of the word 'workman' yet if he raises a dispute about dismissal and re-
instatement it would be outside the words of the definition in connection with employment or non-
employment."

Compassionate appointment.

ln Punjab National Bank and Others v. Ashwini Kumar Taneja, the question was whether denial of
compassionate appointment to the son of an employee dying in harness could be justified on the
ground that his family received substantial retiral benefits. The Supreme Court held it justified.
Reiterating the basic intention (of compassionate appointment) namely that the family should not be
deprived of the means of livelihood, the Supreme Court held that retiral benefits received by the family
(of the deceased) were to be taken into consideration and in this context it referred to the relevant
clause in the employer Bank's Scheme for compassionate appointment.

Regularization of Service.

ln Pankaj Gupta and Others v. State of J. & K and Others, some persons were employed as class IV
employees without Publication Of a notice inviting applications for filling up these posts. The appellants
Were employed only on recommendation by members of State Legislature. NO criteria approved by the
Government or any rules of recruitment were followed while making these appointments. It was held by
the Supreme Court that no person illegally appointed would be entitled to claim that he should be
continued in Service. The Supreme court directed to fill vacancies after fresh notification and the
appellants could apply for these posts and it they do so they should be given relaxation in age.
Dispute relating to workmen employed by the contractor.

The standard Vacuum Company case is the leading case on the point. The Standard Vacuum Company
used to give annual contract for maintenance of the plant and premises. In the first year 67 persons
were employed while the next year only 40 workmen were employed. The contractor's men were not
entitled to any privileges and there was no security of employment. The workmen raised an industrial
dispute demanding the abolition of the contract system. The Supreme Court held the dispute to be an
industrial dispute because there was a real and substantial dispute between the company and the
workmen on the question of employment of contract labour for the work of the company. The fact that
the workmen were employed by the contractor would not alter the nature of the dispute so long as the
party raising the dispute has a direct interest in the subject-matter of the dispute. A dispute about the
reason for stoppage of works or a dispute relating to application and interpretation of standing orders is
also an industrial dispute.

In K.K. Thilakan and others v. FACT Ltd., and another

26 persons were employed by the contractor, Pigee Agencies in connection with the work of the
respondent a public sector undertaking. After about 10 years of service they claimed to be absorbed in
service under the Respondent No. 1. It was held that the petitioners were never the workmen of the
respondent but were only now seeking employment. An industrial dispute cannot exist between an
employer and person seeking employment. Here the petitioners were employed by a contractor
employed by the first respondent. That cannot confer on them any preferential claim to be appointed in
its service.

Disputes regarding medical aid to families or housing of workmen.

ln any industrial dispute, Tribunal has jurisdiction to make proper and reasonable order, but housing Of
the industrial labour is primarily the responsibility of the State, and in the present economic conditions
of our industries, an obligation to provide housing accommodation to the employees cannot be imposed
upon the employers. The Tribunal may also make an award for medical aid to the families of employees,
although there is no authoritative judicial opinion on this point.

Jurisdiction of civil court barred.-

ln State Of Haryana and others v. Bikar Singh,

Respondent was a conductor in Haryana Roadways. He was dismissed from service for embezzlement -
of Rs. 200 which he collected from a passenger and for which he did not issue ticket. A
suit was filed in Civil Court by dismissed conductor seeking a decree Of declaration "that he should be
deemed to be in service and the orders regarding his dismissal passed by the departmental authorities
be declared as null and void. The trial Court examined the case on merit without determining the
jurisdiction of the Court. The Supreme Court expressed its dismay on the absence of a finding of the trial
court on the issue of jurisdiction and set aside the orders of the Civil Court and the High Court. It was
observed that the Civil Court had no jurisdiction to entertain a suit relating to a dispute involving
recognition and enforcement of rights and obligations created under the Industrial Disputes Act, 1947.
Hence, decree passed by Civil Court being without jurisdiction was a nullity. However, the Supreme
Court observed that so much of the salary paid to the respondent for the work he had rendered
pursuant to the impugned orders of the lower forums would not be recovered from the
respondent.

In Rajasthan State Road Transport Corporation and another v. Khadarmal, the service of a probationer
was terminated. The matter was adjudicated by Civil Court which was challenged on the ground Of
jurisdiction. The Supreme Court observed that the Civil Court had no jurisdiction and the decrees passed
had no force of law and were set aside. The right remedy in this case would have been raising of an
industrial dispute under the Industrial Disputes Act, 1947. The Supreme Court held that there could be
no direction to reinstatement or to continue reinstatement. However, back wages, if any paid, should
not be recovered, the Supreme Court added,

Privilege.Where privilege given to an office-bearer of a trade union in the form of duty relief is
withdrawn by the management which has granted the privilege, it cannot be said that an industrial
dispute has arisen thereby. The legal status of the duty relief is only that of a concession and not a
matter pertaining to conditions of service. Where the concession provided is withdrawn, the beneficiary
cannot complain that a condition Of service is affected and the management is not entitled to do so
without raising an industrial dispute and having the matter adjudicated by the Competent authority.

Delay in raising industrial dispute

Delay in raising industrial dispute does not serve as a bar to the reference of a dispute. If the dispute is
raised after a considerable delay which is not reasonably explained, the Tribunal would definitely take
that fact into account while dealing with the merits of the dispute.

Individual dispute and industrial dispute.

Whether a single workman, who is aggrieved by an action of the employer can raise industrial dispute.
Section 2(k) of the Act speaks Of a dispute between employer and workmen i.e., plural form has been
used. "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 provision
of the Act leads to the conclusion that its applicability to an individual dispute as opposed to dispute
involving a group of workmen is excluded unless it acquires the general characteristics of an industrial
dispute' viz., the workmen as a body or a considerable section of them make common cause with the
individual workman"

It was held in Jagdish Narain Sharma and another v. Rajasthan Patrika Ltd. and another, that a dispute
relating to transfer Of a workman will become an industrial dispute only when it is espoused by a union
of workmen or by a substantial number of workmen employed in an industry. Without such espousal
the dispute cannot be treated as an industrial dispute and cannot be referred to a Labour Court.

Section 2-A is of limited application. It does not declare all individual disputes to be an industrial dispute.
A dispute connected with a discharged, dismissed, retrenched or terminated workman shall be an
industrial dispute. If the dispute or difference is connected with other matter then it would have to say
the test laid down in judicial decisions. Thus only a collective dispute could constitute an industrial
dispute but collective dispute does not mean that the dispute should either be sponsored by a
recognized union or that all or majority of the workmen of an industrial establishment should be parties
to it. A dispute is an industrial dispute even where it is sponsored by a union which is not registered; but
the Trade Union must not be one unconnected with the employer or the industry concerned.7 Where an
individual dispute is espoused by union the question of the employee being a member of the union
when the cause arose is immaterial.6 Those taking up the cause of the aggrieved workman must be in
the same employment, i.e., there must be community of interest when the act complained against
happened and not when the dispute was referred to. But even if there is a community of interest
between workman and a person who is not a workman the question of non-employment of the latter
cannot form the subject-matter of an industrial dispute. In order to make a dispute industrial dispute it
is not necessary that there should be a resolution of substantial or appreciable number of workmen.
What is necessary is that there must be some expression of "collective will" of substantial or appreciable
number of workmen taking up the cause of the aggrieved workman. A maximum of 18 per cent
 employees including dismissed employees supporting individual dispute were considered not sufficient
to convert it into industrial dispute. From this it appears that the workman must be a member of the
sponsoring union on the date of dispute. Once a dispute has been referred, it will not cease to be an
industrial dispute because the workmen withdrew their support afterwards .

In Workmen of Indian Express Newspapers Ltd. v. Management of Indian Express Newspaper'

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 per cent 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 in Indian Express and the dispute was thus transformed into an industrial
dispute. Where an industrial dispute existed at the time Of making order of reference this dispute does
not cease to be so merely because dispute relating to only one employee is left over and that the union
which raised the dispute chooses not to represent a particular employee.

What is lay-off ? Explain the provisions of Industrial Dispute Act relating to lay-off.

The following are salient features of lay off:

1) An employer, who is willing to employ, fails or refuses or is unable to provide employment for reasons
beyond his control.

2) Any such failure or refusal to employ a workman may be on account of .

a) shortage of coal, power, or raw materials, or

b) the accumulation of stock, or
c) the breakdown of machinery, or
d) natural calamity, or
e) any other connected reasons.

3) A workman who is so deprived of employment must be such whose name is borne on the muster rolls of
his industrial establishment.

4) The workman must not have been retrenched.

Explanation.

The explanation attached to the sub-section lays down that every workman whose name is borne on the
muster rolls of the industrial establishment and who presents himself for work at the establishment at
the time appointed for the purpose during normal working hours on any day and is not given
employment by the employer within two hours of his so presenting himself shall be deemed to have
been laid-off for that day within the meaning of this clause.

If the workman, instead of being given employment at the commencement of any shift for any day is
asked to present himself for the purpose during the second half for the day and is given employment,
then, he shall be deemed to have been laid-off only for one-half of that day.

If he is not given any such employment even after so presenting himself, he shall not be deemed to have
been laid-off for the second half of the shift for the day and shall be entitled to full basic wages and
dearness allowance for that part of the day .

Meaning of lay-off.

"Lay-off" means putting aside workmen temporarily. The duration of lay-off should not be for a period
longer than the period of emergency. The employer-employee relationship does not come to an end but
is merely suspended during the period of emergency.

Failure, refusal or inability.

In Central India Spinning, Weaving and Manufacturing Co. Ltd., Nagpur v. State Industrial Court, the
Bombay High Court held that the key to the definition is to be found in the words "the failure, refusal or
inability of an employer". These words make it clear that the unemployment has to be on account of a
cause which is independent of any action or inaction on the part of the workmen themselves.
For any other reason.

The expression "for any other reason" appearing in .this sub-section has to be construed ejusdem
generis. Any other reason must be of the kind, as the other reasons stated in the clause. The common
feature of all these reasons is that the workmen are laid off for reasons beyond the control of the
employer. Therefore, the expression "for any other reason" must also denote similar characteristics.

Right and obligations resulting from lay-off.

Lay-off is not a right conferred but an obligation imposed on the employer for the benefit of the
workmen. Far from laying off of an employee being a right, it is really an obligation. The very essence of
a lay-off is that it is a temporary stoppage and that within a reasonable period of time the employer
expects that, the business or industry would continue and his employees who have been laid-off will be
restored to their full rights as employees. Further, in the definition of lay-off there is no indication
whatever that it should continue for a particular period of time.

In Nutan Mills Ltd., Ahmeadbad v. Employees' State Insurance Corporation

the question for consideration was, whether on the employee being laid-off the relation of master and
servant continues and the mutual rights and obligations which flow from such relationship also
continue. The High Court of Bombay was of the opinion that the relationship of master and servant did
not continue but was suspended during the period of lay-off and the employee entitled to any wages. It
was further held that :

"If the contract is not suspended and if the mutual obligation between the employer and the employee
continues, then the mere fact that the employee is not given work or cannot render service to the
employer will not derogate from his right to receive wages from the employer. A subsisting contract of
employment results in there being certain obligations upon the employer and also upon the employee
and also certain rights as between the employer and the employee. The obligations are that the
employer is bound to pay wages and the employee is bound to serve. The rights are that the employer is
entitled to claim from employee that he should render services. The right of the employee is that if he is
prepared to serve he would have the right to receive the wages stipulated. But if the contract of
employment is suspended, then there is no obligation upon the employee to serve the employer, nor is
there a reciprocal obligation upon the employer to pay wages.

In S.A.E. Mazdoor Union v. Labour Commissioner, Indore and others

the Trade Union challenged the order of the Labor Commissioner granting permission to the employer
to lay-off on the ground Of accumulation of stock sought under Section 25M of the Industrial Disputes
Act, 1947. It was held that the fact that accumulation of stock would become inevitable if workmen
 were not laid off would fall within the scope of reasons Of Section 25M read with Section 2(kkk) of the
Industrial Disputes Act, 1947. Under the circumstances, the application for permission to lay-off
reflected a ground on the basis of which the Labor Commissioner could objectively consider the case for
granting the said permission. Therefore the permission for lay-off granted by the Labor Commissioner
was not assailable.

Define strike and Lock out. When they will be come illegal ?

'Lock-out" means the closing of a place of employment, or the suspension of work, or the refusal by an
employer to continue to employ any number of persons employed by him.

Strike is a weapon in the hands of the labor to force the management to accept their demands. Similarly,
lock-out is a weapon in the hands of the management to coerce the labor to come down in their
demands relating to the conditions of employment. Lock-out is the keeping of labor away from work by
an employer with a view to resist their claim.

There are four ingredients of lock-out.

a) temporary closing of a place of employment by the employer, or

b) suspension of work by the employer. or
c) refusal by an employer to continue to employ any number of persons employed by him;
2. the above-mentioned acts of the employer should be motivated by coercion;

3. an industry as defined in the Act; and

4. a dispute in such industry.

Lock-out has been described by the Supreme Court as the antithesis of strike. In view of Madras High
Court, whatever be the circumstances in which the employer may find himself placed and whatever be
the strength of the agencies which forced on him the step and however impotent he may be to avoid
the result, if an employer closes the place of employment or suspends work on his premises, a lock-out
would come into existence. It was further held that in the constant tussle of employees and employer
the strike is the weapon of the employees..........lock-out is the corresponding weapon in the amount of
the employer. if the employer shuts down his place of business as a means of or as an instrument of
coercion or as a mode of exerting pressure on employees or generally speaking when his act is what
may be called an act of belligerency there would be a lock-out.
 In case of lock-out the workmen are asked by the employer to keep away from work, and, therefore,
they are not under any obligation to present themselves for work. The question whether the lock-out
by the employer is justified would be an industrial dispute under the Act, and therefore, the question of
the payment of wages during the period of a lock-out would also be an industrial dispute.

Difference between lock-out and lay-off.

1) Lock-out is an act on the part of the employer taken to coerce or pressurize the labour; lay-off is for
trade reasons beyond the control of the employer, i.e., it is not intentional act.

2) Lock-out is due to an industrial dispute and continues during the period of dispute; lay-off is not
concerned with a dispute with the workmen.

Difference between lock-out and retrenchment.

1) Lock-out is temporary, retrenchment is permanent.

2) In lock-out the relationship of employer and employee is only suspended, it does not come to an end; in
retrenchment such a relationship is severed at the instance of the employer.

3) Lock-out is with a motive to coerce the workmen; the intention of retrenchment is to dispense with
surplus labour.

4) Lock-out is due to and during an industrial dispute, whereas in case of retrenchment, there is no such
dispute.

Difference between lock-out and closure.

1) Lock-out is temporary; closure is permanent.

2) Lock-out is a weapon of coercion in the hands of employer; closure is generally for trade reasons.

3) Lock-out is during an industrial dispute; while in case of closure there need not be any dispute.

Above-mentioned differences may provide some clue as to difference between lock-out and closure but
these are not precise differences. In order to determine whether the employer has imposed lock-out or
 closed the establishment it is not necessary that the closure has to be irrevocable, final and permanent
and the lock-out is temporary or for a period. True test to be applied on the basis of evidence is whether
the closure was a device or pretense to terminate services of the workmen or whether it was bona fide
and for reasons beyond the control of the employer. Duration of closure may be significant fact to
determine the intention and bona fides of the employer at the time of closure but is not decisive of the
matter.

2(q) Strike.

Strike means :

1. Cessation of work by a body of persons employed in any industry action in combination; or

2. a concerted refusal of any number of persons who are or have been employed in any industry to
continue to work or to accept employment; or

3. a refusal under a common understanding of any number of persons who are or have been employed in
industry to continue to work or to accept employment.

Strike means the stoppage of work by a body of workmen acting in concert with a view to bring pressure
upon the employer to concede to their demands during an industrial dispute. The workmen must be
employed in any industry. Mere cessation of work does not come within the purview of strike unless it
can be shown that such cessation of work was a concerted action for the enforcement of an industrial
demand.

As pointed out in this clause a cessation of work or refusal to work is an essential element of strike.
There can be no strike if there is no cessation of work. However, the duration of cessation of work is
immaterial. Cessation of work even for half an hour amounts to a strike What is required, therefore, is
actual cessation of work for howsoever short a period it may be. Mere absence from work is not enough
but there must be concerted refusal to work, to constitute a strike. The workers of a company wanted to
celebrate "May day". They requested the employer of company to declare that day a holiday. They were
also ready to compensate the loss of work by working on a Sunday. On the Company's failure to declare
'May day' as a holiday the workers applied for leave. It was held that there was no "cessation of work"
or concerted refusal to work and the action of the employees to apply for casual leave enbloc did not
amount to strike.

Kinds of Strike.

There are mainly three kinds of strike, namely, (1) general strike; (2) stay-in-strike; and (3) go slow.
General Strike.-A General strike is one, where the workmen join together for common cause and stay
away from work, depriving the employer of their labor needed to run his factory. 'Token strike is also a
kind of general strike. Token strike is for a day or a few hours or for a short duration because its main
object is to draw the attention of the employer by demonstrating the solidarity and co-operation of the
employees. General strike is for a longer period. It is generally resorted to when employees fail to
achieve their object by other means including a token strike which generally precedes a general strike.

Stay-in-Strike.A 'Stay-in-Strike' is also known as 'tools-down-strike' or 'pens-down-strike'. It is that

form of strike where the workmen report to their duties, occupy the premises but do not work. The
employer is thus prevented from employing other labor to carry on his business. Where dismissed
workmen were staying on premises and refused to leave them it was held not to amount to stay in strike
but an offence of criminal trespass. The presence Of excited labor in the factory is a great threat and
danger. The Supreme Court has held that refusal under common understanding to continue to work is a
strike and if in pursuance of such common understanding the employees entered the premises of the
Bank and refused to take their pens in their hands that would no doubt be a strike under Section 2(q).

Go-Slow.ln a "go-slow" strike, the workmen do not stay away from work, they do come to their work
and work also, but with a slow speed in order to lower down the production and thereby cause loss to
the employer. Go-slow strike is not a "strike" within the meaning of the term in the Act, but is serious
misconduct which is insidious in its nature and cannot be countenanced.

In addition to these three forms of strike which are frequently resorted to by the industrial workers, a
few more may be cited although some of them are not strike within the meaning of section 2(q).

i. Sympathetic Strike.A sympathetic strike is resorted to in sympathy of other striking workmen. Its
aim is to encourage or to extend moral support to or indirectly to aid the striking workmen. The
sympathizers resorting to such strike have no demand or grievance Of their own. It was held in
Kambalingam v. Indian Metallurgical Corporation, Madras that when the workers in concert absent
themselves out of sympathy to some cause wholly unrelated to their employment or even in regard to
condition of employment of other workers in service under other management, such absence could not
be held to be strike as the essential element of the intention to use it against the management is absent.
The management would, therefore, be entitled to take disciplinary proceedings against the workmen for
their absence on the ground of breach of condition of service.
ii. Hunger Strike.ln hunger strike a group of workmen resort to fasting on or near the place of work
or the residence Of the employer with a view to coerce the employer to accept their demands. In
Piparaich Sugar Mills Ltd. v. Their Workmen,5 certain employees who held key positions in the Mill
resorted to hunger strike at the residence Of the Managing Director, with the result that even those
workmen who reported to their duties could not be given work. It was held that the concerted action Of
the workmen who went on hunger strike amounted to strike within the meaning of this sub-section.

iii. Work to rule.The employees in case of "work to rule" strictly adhere to the rules while performing
their duties which ordinarily they do not observe. Thus strict observance of rules results in slowing down
the tempo of work, causes inconvenience to the public and embarrassment to the employer. It is no
strike because there is no stoppage Of work at all.