Industrial Disputes

Any dispute or difference between employers,

employers and workmen, or between
workmen and workmen

The dispute must affect larger number

of workmen
The dispute should invariably be taken up by

the industry union

There must be a concerted demand by
workmen for redressal
The parties to the dispute must have direct
and substantial interest in the dispute

Types of dispute
1. Interest dispute: Also called conflicts of
interest or economic dispute.
In general the dispute starts from trade union
demand for higher wages, fringe benefits, etc
2. Grievance or rights dispute: This arises on
discipline or dismissal, payment of wages,
promotion, etc

3. Unfair labour practices: Discrimination

against workers because of trade union
membership
4. Recognition dispute: When a management
refuses a union for collective bargaining
Causes of industrial conflict:
1. Industry related factors
2. Management related factors
3. Government related factors
4. Other factors

Typology of disputes
1. Strikes
(a) primary strikes:
Stay away strike
Sit-down and stay-in strike
Tools-down/pen-down strike
Token or protest strike
Lightening or Cat-call strike
Go-slow

 Picketing and boycott

Gherao
Hunger strike
(b)Secondary strike
Sympathetic strike
(c) Others
Particular
Political
Bandhs

Lockouts
Not by workmen but by the employer
It is the closure of an industrial organization
Suspension of employment
An antithesis of strike

Third Party Intervention: Mediation

Ancient art of peace-making
Mediation is a process by which a third

party brings together the opposing

groups to iron out differences
Mediation is an attempt to settle
disputes
Mediator is a confidential advisor and
industrial diplomat

 Mediation contemplates affirmative

and positive action
Three kinds of mediator

1. The eminent outsider

2. The non-governmental board
3. The board concerned with a Govt.
body
They are not mutually incompatible
When required they can complement
each other with advantage

Essentials of Success of Mediation

1. Mediation can work only in the climate
of consent
2. The mediator must be an impartial and
unprejudiced person
3. He must possess influence on the
parties
4. He must be able to infuse confidence in
the parties
5. He must have full knowledge of the case

6. He should possess extraordinary patience

7. Mediation must take place in a proper
setting
8. It should be available not as a substitute
for bargaining but as a supplement to it
when such bargaining reaches an impasse
9. It should strengthen collective bargaining

Conciliation
It is a process of rational and orderly

discussion of differences between disputing

parties under the guidance of a conciliator
It is a process in which representatives of
workers and employers are brought
together before a third person or a group of
persons
The conciliator is a neutral person who
persuades both parties for settlement

It is a flexible, informal and simple process

which is an art and a situation-specific

process Conciliation Machinery: Conciliation
officer and Conciliation board
Under Section 4 of the Industrial Disputes
Act, 1947 the Govt. appoints conciliation
officer for a specific area or industry
Qualities of a Conciliator
1.Independence and impartiality
2. Conciliator must be physically and
psychologically fit to undertake arduous task

3. He must offer inducements to the

parties for settling disputes
4. A conciliator must have the ability to
get along well with others
5. He must be honest, polite, tactful,
self-confident and even-tempered
6.He must give an impression of
responsible mature, and clear-headed
person
7. He must have a pleasing personality

8. He must be well-acquainted with the

law and regulations concerning
settling of disputes
9. He should be well-trained in
managerial processes
10. He must have the ability to form
judgements

Role of the conciliator

As
As
As
As
As
As
As
As
As
As
As

a discussion leader
a safety valve
a communication link
an innovator
a sounding board
a protector
a fall-safe device
a stimulator
an advisor
a face saver
a promoter for collective bargaining

Preliminary Steps towards

Conciliation:
Scheduling, arranging and conduct of
meetings. Sequential Pattern of
Conciliation
1. The Hard Posture Phase: Both
parties show inflexibility & adamant
defence of position
2. Search for Accommodation of other
partys position

3. Emergence of Appropriate Mood for

Settlement of Compromise. It is done by
(i)listening attentively to the parties,
(ii)asking questions to get information,
(iii)Persuading parties for settlement
4. Pressure Building by the Conciliator
(i) Personal pressure
(ii) Social pressure
(iii) Political pressure
(iv) Economic pressure

Arbitration
It is process in which a dispute is submitted to

an impartial outsider who hears it and

determines its cause
The parties submit their disputes/issues and
are bound by the award of an arbitrator
It is different from conciliation in approach
and spirit; in arbitration adjudication is done,
and there is no place for compromise in
award, though parties are at liberty to do so

Conciliator reconciles the recommendations of

the parties, but arbitrator enforces his point

Arbitration is more judicial in nature

than conciliation
It is a quasi-judicial process
The arbitrator bases his decision on
the principle of natural justice
Types of arbitration:
voluntary
compulsory

Under voluntary arbitration, the parties refer a

dispute to arbitration before it is referred for
adjudication

Subsequent attendance of witnesses

and investigation is ensured by the

parties
The enforcement of an award may not
be necessary and binding, because
there is no compulsion, though usually
it is accepted
It is especially needed for disputes
arising out of agreements

Mahatma Gandhi favoured voluntary arbitration.

ILO also suggested voluntary arbitration

National Arbitration Promotion Board with

a tripartite composition was appointed in

July 1967. It has the following functions:
(i) To review the position periodically
(ii) To examine the factors inhibiting its
wider acceptance
The award cannot be appealed against
except in a High Court under Article 226
of the Indian Constitution

In compulsory arbitration parties are required to

accept verdict without any willingness on their part

Under compulsory arbitration the parties

are forced to arbitration by the state when

(i) the parties fail to arrive at a settlement
by a voluntary method, or
(ii) when there is a national emergency that
require continuous production of
goods,or
(iii)The country is passing through a grave
economic crisis

Compulsory arbitration leaves no scope

for strike or lockout
Where any industrial dispute exists and

the employer and majority of workers

agree to refer it to arbitration, it may be
done under Section 10A of Industrial
Disputes Act, 1947
Arbitration agreement has to be signed
by both the parties, which is published
by the Government in Gazette within
one month

Procedure: Arbitrator may call witnesses, get

evidence and relevant records and documents

After the collection of facts, arguments

take place.
Arbitrator after the hearing submits his
award to the Government in writing. It
has the same force as the judgement
of a labour court or tribunal
The award must be signed by the
arbitrator

Adjudication
Adjudication involves intervention in the

dispute by a third party appointed by the

Govt. for the purpose of final settlement
When both parties, at their own accord,
agree to refer the dispute to adjudication, it
is obligatory for the Govt. to make reference.
It is then called voluntary adjudication
When reference is made by the Govt. on its
own, it is called compulsory adjudication

Three-tier system: 1. Labour Courts, 2.

Industrial Tribunals, and 3. National Tribunals
Labour Courts: One or more labour courts may

be constituted by the appropriate Govt. for

adjudicating under Second Schedule of the
Industrial Disputes Act, 1947
A Labour court consists of 1 person only,who
(1) is or has been a judge of High Court, or
(2) has been for a period not less than 3 years
a District Judge, or
(3) has held a judicial office in India for not
less than 7 years

No person shall be appointed or continue in the

office if he is not an independent or above 65 yrs

Labour court usually deals with matters that

arise out of daytoday working of an industry
The jurisdiction of the labour court extends to
the propriety or legality of an order passed
by an employer under the Standing Orders,
Discharge or dismissal of worker/s,
Withdrawal of any customary concession or
privilege

Industrial Tribunals
The appropriate govt. may appoint one

or more industrial tribunals for

adjudication of any dispute specified
under Schedule 2 or 3
A tribunal shall consist of 1 or more
persons, (i) who are or have been
judge/s of a High Court,
(ii) who are or have been District Judge
for not less than 3 years

(iii) Hold or have held the office of the chairman or

member of Labour Appellate Tribunal for at least 2 yrs

The Govt. may appoint two persons or

assessors to advise the Tribunal

Although it is not a court, it has all the
necessary attributes of a court of law
Tribunal has wider jurisdiction than
labour courts. It has jurisdiction over
any matter specified under Second or
Third Schedule

The matters specified in the third schedule are:

1. Wages, including period and mode of payment

2. Compensatory and other allowances

3. Hours of work and rest intervals
4. Leaves with wages and holidays
5. Bonus, profit-sharing, PF, and gratuity
6. Shift-working, classification of grades,
7. Rules of discipline
8.Rationalization
9.Retrenchment of workmen and closure

There are 12 Central Govt. Industrial

Tribunals-cum- Labour Courts
The states and union territories have 206

Labour Courts, 95 Industrial Tribunals and

22 Industrial Tribunal-cum-Labour Courts in
1994
National Tribunals
The Central Govt. may by a notification in
the Gazette constitute one or more National
Tribunals for disputes involving national
importance or to more than one state

A national tribunal shall consist of one person

only who (i)is or has been a judge of a High Court

or (ii) has held the office of the Chairman or

any other member of the Labour Appellate

Tribunal for a period not less than 2 years
Central Govt. may appoint two persons as
assessors to advise the national tribunal
Awards are binding on disputing parties
under Article 136.
However, parties can move a dispute to
High Court or Supreme Court, if dissatisfied