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By: Aayushi Khanna Amaneet singh Brar Ashita Negi Awantika Jain Deepak Goyal
Industrial Dispute
Collective Bargaining
Collective bargaining is a type of negotiation used by employees to work with their employers. During a collective bargaining period, workers representatives approach the employer and attempt to negotiate a contract which both sides can agree with Typical issues covered in a labor contract are hours, wages, benefits, working conditions and the rules of workplace Once both sides have reached a contract that they find agreeable, it is signed and kept in place for a set period of time,most commonly three years. The final contract is called a collective bargaining agreement to reflect the fact that it is a result of a collective bargaining effort. The parties often refer to the result of negotiation as collective bargaining agreement(CBA).
When collective negotiations reach a deadlock, the parties themselves may call in third persons to help them settle their disputes. The role of this third person is to break the deadlock, to interpret the view point of one to the other and thereby to help the parties arrive at an agreement.
Voluntary Arbitration
It refers to getting the disputes settled through an independent person chosen by the parties involved mutually and voluntarily. Arbitration offers an opportunity for a solution of the dispute through an arbitrator jointly appointed by the parties. It is commonly viewed as less expensive and faster than resolving a dispute in court. An arbitrator may be a single person or a panel.
At the time of submitting a dispute to arbitration,t he parties may agree in advance ,to abide by the award of the arbitrator and thus industrial peace is maintained and the dispute is resolved. Sometimes, however the parties may agree to submit the dispute to an arbitrator but at the same time, reserve their right to accept or reject the award when it comes.
The primary idea behind establishment of such bipartite committees are:a) Giving encouragement to the parties concerned to settle and compose their differences by themselves in order to avoid the direct intervention of a third agency b) Facilitating the composition of differences at their embryonic stages without causing work-stoppages.
1. 2.
3.
There are three main considerations for prohibiting the parties from causing work-stoppage and imposing time limit. They are: Conciliation provides a cooling off period Freedom of the parties to settle their disputes even by causing work stoppage, should not be taken away from them for long period. If conciliation does not achieve an early break-through, it is not very likely to succeed later.
If, at the end of the conciliation proceeding, the parties fail to settle their dispute, they are free to go on a strike or declare a lockout.
There are two principal forms of compulsory arbitration are: 1. Compulsory reference but voluntary acceptance of the award. 2. Compulsory reference and compulsory acceptance of the award.
Focus:
Burden of proof is on the workman to establish that he had worked for 240 days in 12 calendar months preceding the date of his termination.
Case:
Respondent is a research institute. It imparts training to farmers for facilitating improved agricultural production. It was a charitable institute for the farmers. They are also undertaking Poultry Farming, Pisciculture, Cow-shelter, Dairy farming, Bee Farming etc. Daily wagers were appointed for the said purpose. Appellants are the daily wagers for bee farming whose services were not taken from 28.12.1996, these wagers claimed to have been working for the institute for a long time, and they therefore raised an industrial dispute.
Labour Court
The state of U.P. referred it for adjudication before the presiding officer, Labour court, U.P. Allahabad. Before the court both the parties adduced their evidences. The Labour Court later took into consideration the fact that the respondents despite having been called upon to produce relevant records failed to do so, and therefore drew an adverse inference against it. It was therefore held that termination was bad in law, therefore reinstatement was ordered with 25% back wages.
High Court
The respondents filed a writ with the High Court, by reason of impugned judgement. The high court set aside the award of labour court opining that the burden of proof had wrongly been placed on the respondent, and that the judgement was based on inferences and guesses.
Supreme Court
Notice by the Supreme Court the appellants cannot be reinstated in service as the respondent institute have stopped bee farming, therefore payment of adequate amount of compensation in place of reinstatement sub serves the ends of justice. It was decided that Rs. 1,00,000 to each of the appellants will help meet the ends of justice.
Compulsory Arbitration Introduces an element of law and justice. Based upon coercive power of state. Prevents strong groups and organizations from holding the community to ransom. Help community by imposing terms & conditions which is fair & which keeps cost of production & price within reasonable limits.
Adjudication Award is highly subjective Psychological bent, mental make up & prejudices of adjudicator that finally decide the outcome of adjudication proceeding. Inability to ensure industrial peace No award can be enforced when masses of workers are dissatisfied with it. Vitiate industrial relations by creating litigious atmosphere. Creates artificial atmosphere because both the parties try to evade the real issues as long as possible. Lays excessive stress on legalism but it doesnt solve the problem
According to Clause 25 of Memorandum of Settlement & Clause XXXVIII of Memorandum of Agreement, workman should prefer an appeal before Arbitration Committee which is not done in this case. So, Dispute cant be referred to Tribunal under Section 10-A of Industrial Dispute Act. Mr. Das submitted that Tribunal lacked initial Jurisdiction & could not go into validity of said reference. Memorandum of Settlement was binding on workman but not Memorandum of Agreement. So tribunal acted illegally & with material irregularity in holding that no reference could be made under Section 10-A of I.D. Act
Verdict
Tribunal cannot go into the question of validity of a reference & reference made to tribunal was not in consonance with law. Court find no reason to interfere with impugned award. The petitioner an appeal before Arbitration Committee within eight weeks hence, the committee shall dispose of the said appeal in consonance with law expeditiously, preferably within four months thereof.
Legal Framework of IR
Various Machineries to Tackle Industrial Disputes Statutory Machinery Non- Statutory Machinery
ii.
Statutory Machinery
Statutory Machinery
Statutory Machinery consists of:
1. 2. Works Committee, Permanent conciliation services for particular geographical areas or industries both at the central and state levels, Ad hoc Board of Conciliation at the central and state levels, Ad hoc Courts of Inquiry at the central and state level, Adjudication authorities consisting of Tribunals and Labor Courts at the central and state levels, National Tribunals at the central level. Arbitration Grievance Handling Procedure
3. 4. 5. 6. 7. 8.
1. Works Committee
Constituted where 100 & more workers are employed in an industrial establishment Govt. may require the employer to set up work committee Composed of equal number of representative of workers and management At max 20 representatives To preserve amity and establish cordial relations Is purely consultative body Deals with day to day functioning- leaves, holidays, wages, working hours
2. Conciliation Officer
Appointed for specific area or specified industries Mediate in and promote the settlement of industrial disputes Where industrial disputes exists or is apprehended conciliation officer shall hold conciliation proceedings He cannot take decision - send report of settlement to his government Duty of the conciliation officer is administrative and not judicial in nature If the agreement is reached by the parties, it is binding on both the parties.
Submission of report in 14 days Submission in both circumstances , Able to arrive at a settlement Not able to arrive at a settlement(with reasons) Govt. can nominate any no. of Conciliation Officers for permanent or temporary basis.
3. Board of Conciliation
Govt. may notify constitution of board of conciliation for promoting settlement of an industrial dispute Its role is also consultative. Consist 2 or 4 other members plus chairman Chairman an independent person (should not have any interest in either of the parties) BOC submits report within 2 months
4. Court of Enquiry
Govt. may constitute a court of enquiry Consists of 2 or 4 members (including chairman) Object is to enquire into and reveal the causes of an industrial dispute. Submission of report within 6 months Can be permanent/temporary
5. Adjudication
The ID Act provides three tier system of adjudication of industrial dispute. Cases either may be referred by government to court after the receipt of failure report form conciliation officer or directly by any party. a. Labor Courts : Legality of order, Application and interpretation , Discharge and dismissal of workman, Withdrawal of any customary , Illegality or otherwise of a strike or lock out.
b) Industrial Tribunals All matters within jurisdiction of labour courts, wages, compensatory and other allowances, hours of work and rest intervals, leave with wages and holidays, bonus, provident fund and gratuity, working shifts, classification of grades, rules of discipline, and Retrenchment and closure of establishment.
c) National Tribunal Constitute when more than one state is affected by such dispute and matters related to functioning of labor and industrial courts.
6. Voluntary Arbitration
It is voluntary method of resolving individual disputes Here both parties are willing to go to an arbitrator and submit to his decision. Arbitrators can be one or even more than one. Decision given by arbitrator is binding Award is valid for 1 year, can be extended max. up to 3 years but not on continuous basis(renewed on expiry of 1 year) . Award is a final interim decision
Non-Statutory Bodies
Non statutory bodies exist at different levels such as the Indian Labour Conference and Standing Labour Committee at the national level, Wage Boards and Industrial Committees at the industry level, and State Labour Advisory Boards at the State Level The primary purpose of these organisations is to work out the guiding principles of the relations between employers and employees in order to prevent industrial disputes from arising.
Decisions in these bodies are arrived at on the basis of a consensus arising out of the discussions rather than on formal voting, although a provision exist in the rules of both the ILC and the SLC, for taking decisions by a two-third majority. The main objectives underlying their establishment were: promoting uniformity in labour legislation; laying down of a procedure for the settlement of industrial disputes; and discussing all matters of national importance as between employers and employees
The scope of the deliberations of both bodies is confined mainly to labour matters in the country. The deliberations of these bodies have helped reaching a consensus regarding minimum wage fixation, introduction of health insurance and provident fund schemes, enactment of new labour laws and modification of the existing ones. The procedure of settling industrial disputes as envisaged in the Industrial Disputes Act, 1947 is a direct outcome of the deliberations of these bodies. The Code of Discipline and the Code of Conduct evolved at the ILC have also played an important role in influencing the pattern of industrial relations
Working
The Code of Discipline has come to be accepted not only by the central organisations of employers and workers represented by the Indian Labour Conference, but also by those who are not he members of these organisations. The Code is also applicable to public sector undertakings run as companies and corporations except those under the Ministry of Defence, Railways , and Ports The Code has also come to be applied to the Department of Defence Production, LIC, SBI and RBI
Some of the points of Code of Discipline should be embodied in law as suggested by the first National Commission on Labour. These include: Recognition of unions as bargaining agents, Setting up of an grievance machinery in an undertaking Prohibition of strike/lock-outs without notice Penalties for unfair labour practices Provision for voluntary arbitration
Industrial Committees
The establishment of Industrial Committees for specific industries was the outcome of the 1944 session of the Indian Labour Conference. There is no rigid constitution in respect or these committees, but the policy of their remaining tripartite in character and equal representation of employers and workers is accepted Within the framework of this broad policy, the actual composition is decided afresh each time a meeting is convened
The first Industrial Committee was set up in1947 for plantations Later, such committees came to be set up for many other industries like, coal mining, cotton textiles, cement, tanneries and leather goods manufactories, mines other than coal, jute , building and construction, chemical industries, iron and steel, road transport , engineering industries, metal trades , electricity, gas and power, and banking Meetings of Industrial Committees are ,however, not held regularly; these are convened as and when required
Wage Boards
Second Five Year Plan had observed: Statistics of industrial disputes show that wages and allied matters are the major source of friction between employer and workers. An authority like a tripartite wage board, consisting of equal representatives of employers and workers and an independent chairman will probably ensure more acceptable decisions. Such wage boards should be instituted for individual industries in different areas
The Third Five Year Plan also encouraged Wage Board The first non-statutory Wage Board was set up for the cotton textile industry in1957. Subsequently, Wage Boards were set up for other industries too. A Wage Board generally consists of an impartial Chairman, two other independent members, and two or three representatives of employers and workers each.
The Boards were purely recommendatory bodies and dissolved after they had submitted their recommendations The most important function performed by a Wage Board had been to determine the wage structure for the industry concerned and to specify the categories of employees to be brought under the purview of the wage fixation. In some cases, they were also asked to deal with such questions as gratuity, hours of work and bonus. Now, the Wage Board system has fallen in disuse.
While developing the framework for its recommendation, the Commission took into account, the emerging economic environment involving rapid technological change, globalisation of economy, liberalisation of trade and industry, need for bringing existing laws in tune with future labour market needs and demands. The Commission recommended new labour laws on labour management relation, wages, occupational safety and health, small enterprise, hours of work, leave and other working condition of work place, child labour and unorganised sector etc.
Case Analysis
Staff officer in Zonal office appointed enquiry officer After furnishing a copy of the report to the workman a show cause notice was issued seeking his explanation & after hearing him an order of termination dated 14.3.1991 was passed Workman preferred departmental appeal: dismissed (9.7.1991) Workman approached the Conciliation Officer : Central Govt. referred the dispute u/s 10 of ID Act to the IT (26.3.1993)
Held in The Cooper Engineering Ltd Vs. P.P.Mundhi: Once the Tribunal had recorded a finding that the enquiry was vitiated, it was bound to grant opportunity to the petitioner to prove the misconduct before the tribunal itself for which the application had already been made on his behalf
Firstly, principle of extra judicial is confined to criminal law & not to domestic enquiry Secondly, this admission of the workman before Mr . Jaiswal cannot be termed as extra judicial confession, in fact the workman was seeking to save himself & was apologizing before Jaiswal Hence reasons given by tribunal for discarding Mr. Jaiswals statement are unacceptable Also Shri Babu Dal Daftri had stated that the workman had given him the requisition slip for the cheque book while Shri Hamid had unequivocally stated that he had given the cheque book to the workman though it is normally given to the counter clerk because the workman claimed that Shri Jaiswal was his acquaintance
The Tribunal refused to believe their statements solely on the ground that though the cheque book ought to have been given to the counter clerk why Shri Hamid had given it to the workman. This shows that, there was clinching evidence against the workman together with the attending circumstance that immediately after withdrawing the amount the workman availed his L.F.C. and had gone on a pleasure trip
Judgement
The court held that , the Enquiry Officer was justified in terminating the service and the Tribunal without taking a holistic view has applied technical arguments to overcome findings of fact recorded on the basis of evidence by the Enquiry Officer For the reasons given above, this petition succeeded and was allowed and the impugned award dated 3.5.1997 was quashed