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UNIT: II – INDUSTRIAL CONFLICT

Industrial disputes/ conflicts

Industrial Dispute has been defined as “any dispute or difference between employers and
employers or between employers and workmen or between and workmen which is connected
with the employment or non-employment, or the terms of employment or the conditions of
labour, of any person. (Sec.2(k), Indian Trade Unions Act, 1926).
Three ingredients of Industrial disputes:
i. There should be real dispute
ii. Dispute between Employer & Workmen
iii. Dispute connected with employment or non-employment

Types of Industrial disputes:

a) Individual disputes: Any dispute between that workmen & employer connected
with dismissal, termination or retrenchment of that workmen.
b) Collective dispute – effected all the workmen relating to Wages, bonus, compensation,
hours of work, leave, Holidays, Rules of discipline, closure of organization,
Retrenchment ect.,

Lay – Off (U/s.2 (kkk))

Lay-off means, the failure, refusal or inability of an employer to give employment to a
workmen due to – shortage of coal, power, raw material or the accumulation of stocks or the
breakdown of machinery or natural calamity.
Lock-Out (U/s.2(l))
It means the temporary closing of a place of employment or suspension of work or
refusal by an employer to any number of employees
- Lock-out is a weapon available to employer
- Strike is a weapon available to employees.

Differences between Lay-off and Lock out.

Lay- off Lock-out
1. Employer refuses to give employment
1. Due to closing of a place of
due to shortage of resources employment
2. Due to trade reasons, beyond the 2. It is a weapon used by the employer
control of the employer influencing workmen to accept his
demand
3. No way connected with Industrial 3. It is connected with Industrial dispute
dispute

Retrenchment (U/s.2 (OO))

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The termination by the employer of the service of a workman for any reason otherwise
than as punishment by way of disciplinary action.
Retrenchment not include: -Voluntary retirement - Retirement due to reaching the R’age
- Termination due to non-renewal of contract.

Causes of industrial conflicts

A. Industry related factors
i) The industry related factors pertaining to employment, work, wages, hours of
work, privileges, the rights and obligations of employees and employers, terms
and conditions of employment, and also;
a. Dismissal or non-employment of any person
b. Registered agreement, settlement or award; and
c. Demarcation (separation) of the functions of an employees

ii) A matter in which both the parties are directly and substantially interested
iii) A high quantum of job-seekers in the employment market
iv) The galloping (increasing) prices of essential commodities - the existing
inadequate and unjustified wage structure.
v) The attitude and temperament of industrial workers have changed because of
their education, adoption of urban culture, etc.
vi) Failure of trade union to safeguard the interest of working class, due to
 Inter-union revalry and multiplicity of unions
 Non-recognition of TUs
 Increasing compulsory adjudication of disputes
 Non-bothering attitude of TUs other than wages
 Communal/ caste considerations of TUs.

B. Management related factors

i) Mgmt. generally is not willing to talk over any dispute with the employees or
their representatives
ii) The management’s unwillingness to recognise a particular TU
iii) Even when the representatives of TUs have been recognised, the mgmt. not to
delegate enough authority
iv) During negotiations for the settlement of disputes, the representatives of
employers, unnecessarily and unjustifiably take the side of mgmt. and creates
problems.
v) Mgmt. does not like to involve employees on recruitment, promotion, transfer,
merit awards, etc., it creates problem
vi) The services and benefits offered by mgmt. to workers is far from satisfactory,
which invariably leads to conflict.
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vii) The decisions of managements to change their working methods, leads to

reduction of surplus manpower.

C. Government related factors

i) The changes in economic policies also create many disputes (Like liberalization
and privatization).
ii) Ineffective and unsatisfactory working operations:
 Out-dated labour laws in the context of changed industrial climate
 Improper and inadequate implementation of labour laws
 Inherent difficulties in monitoring the working of various labour laws.
iii) The growing irrelevance of Govt.’s conciliation machinery

D. Other factors
i) The trade union movement is highly influenced by politics
ii) The political instability and sometimes the strained Center-State relations are
reflected industry, resulting industrial conflicts.
iii) Other factors, such as rampant (Uncontrollable) corruption, easy money,
conspicuous consumption, permissive (tolerant) society, etc.
iv) The tense inter-union revalry.

Impact of Industrial disputes/ conflicts

1. A huge wastage of man-days and dislocation in the production work.
2. They disturb the economic, social and political life of a country.
3. Causes for strike – Stoppages due to strike leads to shorter supply of consumer goods
results in sky-rocketing prices and non-availability.
4. The workers may lose their wages for the strike period
5. May lose employment and future prospects
6. The disruption in the family life, personal hardship, mental agonies and tensions develops
and persist.
7. The workers may be prosecuted, often intimidated, even victimized or kidnapped.
8. The employers suffer heavy losses, not only through stoppages of production, reduction
in sales and loss of markets but also in the form of huge expenditure incurred on crushing
strikes.
9. The public/ society also affected by industrial unrest, it creates law and order problems.
10. Industrial disputes also affect the national economy.

Industrial Peace
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The active presence of harmonious and good industrial relations, generating amity and
goodwill between the employers and employees in an industry and absence of industrial unrest.

Strike U/s.2(q)
a. A cessation of work by a body of persons employed in any industry acting in
combination
b. A concerted refusal of any number of employees
c. Refusal under a common understanding of any number of employees

Types of strikes
A. Primary strikes – against the employer with whom the dispute exists.
Stay away strike: Workmen do not come to the work place during the
prescribed working hours.
Sit-down and stay –in Establish them in the plant, stop its production and
strike: refuse access to the owner. When the demands of the
workers are not met on the strike day and the workers
remain in the plant and not leave the plant.
Tools-down strike/ The strikers lay down their tools or pen and refrain from
Pen-down strike: doing work.
Token or protest strike It is of a very short duration strike and is in the nature of
a signal for the danger ahead
Lightning or Cat-call It is suddenly announced, it takes place because of some
strike provocation (frustration)
Go-slow The worker deliberately reduces the speed of the work
and reduces production
Picketing and boycott Marching of workmen in-front of the premises of the
employer, carrying and displaying signs, banners, etc. –
protests at the factory gate for the purpose of persuading
visitors and others not to enter the premises.
Boycott aims at disrupting (trouble making) the normal
functioning of the enterprise.
Gherao It is a physical blockade of a target by encirclement,
intended to block the egress (way out) and ingress from
and to a particular office, etc.

B. Secondary strikes
Hunger strike Not taking food, the purpose being to create sympathy of the
employer and to attract the attention of the public
Sympathetic Go on strike for the purpose of directly aiding or supporting
others in their cause.
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C. Others: General, Particular, Political and Bandhs.

Prevention of Strike
1. The Management should adopt well-defined, precise, clear and progressive Human
resource management policies for the maintenance of good industrial relations in the
undertaking.
2. It should ensure an effective administration and timely implementation of these
policies.
3. It should ensure that an effective two-way communication system in operation. This
will help the management to create a favourable climate of goodwill and faith in the
organisation, and enable workers to appreciate the management’s policies in their right
perspective so that no misunderstanding is created between them.
4. It should provide just and human conditions of work, along with suitable welfare
activities for the benefit of the workers and develop close personal contacts with the
employees at all levels.
5. It should evolve and adopt a suitable and speedy grievance redressal procedure for the
management of workers’ problems.
6. It should give recognition to a representative union and should have a pragmatic
approach to union activities.
7. It should ensure joint consultation at different levels and encourage collective
bargaining for the resolution of the differences between them.

Government machinery to resolve industrial disputes

The various methods and machinery under the industrial disputes act can be classified as
under the following heads:
(I) Conciliation
a. Works committee
b. Conciliation officer
c. Board of conciliation
(II) Arbitration
d. Court of inquiry
(III) Adjudication
e. Labour court
f. Industrial tribunal and
g. National tribunal

Setting up authorities for prevention, investigation and settlement of Industrial disputes, they are:
1. Works committees (Sec.3) 5. Labour courts (Sec.7)
2. Conciliation officers (Sec.4) 6. Industrial Tribunals (Sec.7-A)
3. Boards of Conciliation (Sec.5) 7. National Tribunals (Sec.7-B)
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4. Courts of inquiry (Sec.6)

3 modes of settlement of disputes under this act
A. Voluntary settlement and conciliation
B. Adjudication
C. Arbitration

[A] CONCILIATION MACHINERY

Which include Works committees, Conciliation officers, Board of Conciliation and

Courts of Inquiry. They can only make inquiry about the disputes, but can not make any awards.
1. Works committees (WC): (Sec.3)
- Where 100 or more workmen are employed, the WC must be constituted
- Members: The employer & employees should be the members of the committee, the
employees strength should not be less than the employer’s representatives in the committee.
Powers & Duties
- Securing & preserving amenity or good relations between employers and workmen
- Comment upon matters of their common interest
- Compose any material difference of opinion in welfare, wages, holidays etc.

2. Conciliation officers (Sec.4)

The appropriate Government through notification in Official Gazette appoint Conciliation
officers. Their duty is to mediate and promote the settlement of Industrial disputes.
Duties:
a. To hold conciliation proceeding s- where any disputes exists.
b. To investigate the dispute
c. To send a report & memorandum of settlement to appropriate Govt.
d. To send a full report about their efforts for settlement, to the Govt. in case no settlement
is arrived.
e. Report should be submitted within14 days of the commencement of the conciliation
proceedings or within the time period fixed by Govt.
Powers:
1. Power to enter premises
2. Power to call for and inspect documents

3. Boards of Conciliation (Sec.5)

The appropriate Govt. constitutes this board and appoints its members through official
gazette.
Members:
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It consists of a Chairman (An independent person) & 2 or 4 other members. The other
members appointed to represent the disputed parties on the recommendation of them.
Duties:
a. To Bring about a settlement of the dispute
b. To send a report & memorandum of settlement to appropriate Govt
c. To send a full report about their efforts for settlement, to the Govt. in case no settlement
is arrived.
d. To communicate reasons to the parties, if no further reference made.
e. To submit report within 2 months.
Power:
1. Power to enter premises
2. Power of Civil court
- Enforcing attendance
- Compelling the submission of document
- Issuing notice for the examination of witnesses.

4. Court of enquiry
It is for inquiring into any matter appearing to be connected with or relevant to an
industrial dispute.
Duties:
- It should inquire into the matters referred to it.
- To send report of Govt. within 6 months.
- The reports should be in writing & signed by all the members.
- It should record any minutes of recommendations in report
Power:
1. Power to enter premises
2. Power of Civil court
- Enforcing attendance
- Compelling the submission of document
- Issuing notice for the examination of witnesses.
3. This court may appoint any person having special knowledge of the matter under
consideration.

[B] ADJUDICATION MACHINERY

Sec.7 to 9, explain the adjudication authorities are:
1. Labour court (Sec.7)
2. Industrial Tribunal (Sec.7-A)
3. National Tribunal (Sec.7-B)

1. Labour court (Sec.7)

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The appropriate Govt. may constitute one or more labour courts for adjudication of
Industrial disputes specified in the 2nd schedule.
Matters within the Jurisdiction of Labour court (The 2nd Schedule)
a. The legality of an order passed by an employer
b. Discharge and dismissal of Workman
c. Withdrawal of any customary concession or privilege
d. Illegality of strike and lock-out
* The Labour court should consist of only one person, to be appointed by the appropriate
Government.

Qualification of the Authority: - The person should be,

a. The Judge of High court
b. District judge or Additional district judge (Not less than 3 years of service)
c. Presiding officer of Labour court ( Not less than 7 years of service)
Duties:
a. To adjudicate upon Industrial disputes, specified in 2nd schedule
b. To give award within the specified period
- Award to be in writing & signed and its published
Power: a. Power to enter premises
b. Power of Civil court
- Enforcing attendance
- Compelling the submission of document
- Issuing notice for the examination of witnesses.

2. Industrial Tribunal (Sec.7-A)

Constituted for the adjudication of industrial disputes specified in the 2nd & 3rd schedule.
Matters within the Jurisdiction of Industrial Tribunal (The 3rd Schedule)
a. Wages, including the period or modes of payment
b. Compensatory & other allowances
c. Hours of work and rest intervals
d. Leave with wages & holidays
e. Bonus, PF, Gratuity, etc.
f. Shift working
g. Classification of grades
h. Rules of discipline
i. Rationalization
j. Retrenchment of workmen & Closure of establishment

Qualification of the Authority: - The person should be,

d. The Judge of High court
e. District judge or Additional district judge (Not less than 3 years of service)
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f. Presiding officer of Labour court ( Not less than 7 years of service)

Duties:
c. To adjudicate upon Industrial disputes, specified in 2nd schedule
d. To give award within the specified period
- Award to be in writing & signed and its published
Power: a. Power to enter premises
b. Power of Civil court
- Enforcing attendance
- Compelling the submission of document
- Issuing notice for the examination of witnesses.
c. Power to appoint assessors (Specialists of a particular field)
d. Power to award cost

3. National Tribunal (Sec.7-B)

It is constituted for the adjudication of industrial disputes which, in the opinion of the
central Govt. considered as National importance or the disputes of industrial establishment
situated in more than one state.

* Qualification, Duties and Power of the Authorities are as same in Labour court and
Industrial tribunal.

Award and Settlement

Award: An interim or final determination of any industrial dispute framed by Labour
court, Industrial tribunal or National Tribunal or Arbitrators.

Settlement: - A settlement arrived at in the course of conciliation proceedings

- A written agreement between the employer & workmen arrived during the
course of conciliation proceedings.

Differences between Awards and Settlements

AWARDS SETTLEMENTS
1. Definition of Award 1. Definition of Settlement
2. Enforceable on expiry of 30 days from its 2. Enforceable on the date in which the
publication agreement is signed
3. Rejection/ modification of award is possible 3. At any time
within 90 days
4. Period of operation of award is 1 year 4. The period agreed or for 6 months
5. Report should be published 5. Need not be published
6. An award can be arrived through Labour 6. The settlement is arrived through
court, Industrial Tribunal and National Tribunal Conciliation.
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--------------------------------------------------------------------------------------------------------------------
Mediation
Mediation is a process by which a third party brings together the opposing groups not only to
iron out the differences between them but also to find an answer to problems or specified
proposals and offer alternative suggestions.
Mediation is a attempt at settling disputes with the help of an outsider who assists the parties
in their negotiations.

State the kinds of Mediator: There are three kinds of mediators, according to Prof. Pigou,
namely
(i) The eminent outsider;
(ii) The non-governmental board; and
(iii) The board connected with some part of the govt. system of the country.

I. Conciliation

Conciliation may be described as “The practice by which the services of neutral third party
are used in a dispute as a means of helping the disputing parties to reduce the extent of their
differences and to arrive at an amicable settlement or agreed solution.
It is a process of rational and orderly discussion of differences between the parties to a
dispute under the guidance of a conciliator.

List the qualities necessary for a Conciliator

(i) Independence and impartiality are the two attributes which every conciliator
should possess.
(ii) A conciliator should be physically and psychologically fit for the rigours of his t
task.
(iii) A conciliator should never allow conciliation proceedings before him to
Constitute a mere formality or a step on the road to arbitration
(iv) A conciliator must have the ability to get along well with people.
(v) He must be honest, polite, tactful, self-confident, even-tempered and patient in
trying to achieve results. He should have powers of persuasion,
(vi) A conciliator has to deal with different persons and has to preside over their
meetings in conciliation proceedings,
(vii) A conciliator should have a friendly personality, a sense of humour, and have a
Gift for relieving tensions at joint discussion.
(viii) A conciliator should be well acquainted with law and regulations concerning
industrial relations and the settlement of industrial disputes.
(ix) He should be well-trained in different aspect of the management process. He
should have some knowledge of products and services, the production methods,
practices, etc.
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(x) He must have the ability and versatility to form judgments.

Role of the Conciliator

(a) As a Discussion Leader
* Reduces irrationality and antagonism (aggression) between the parties
* Guides them towards problem solving approach to their dispute
(b) As a Safety Valve
* He places himself in the position of an alternative target, when the parties in
aggressive mood and for emotional release
(c) As a Communication Link
* Between the parties and also provides a thorough explanation and interprets the
intentions of either party.
(d) As an Innovator
* Acts as a source of new information and new thoughts, particularly in providing
the parties with different views of the issues with possible alternative solutions
and possibly an entirely new approach.
(e) As a Sounding Board
* He may be called “Flying ambulance squad” appearing whenever or wherever
conflict arises.
(f) As a Protector
* He readies the parties for collective bargaining positions by exploring
alternative solutions during separate meetings.
(g) As a Fail-Safe Device
* Assists a party which has overstated its position to the extent of bluff or
exaggeration of its reaction.
(h) As a Stimulator
* He provides the necessary impulse to a settlement; he makes a concise
statement, etc.
(i) As an Adviser
* Conciliator tires to remove misunderstandings regarding the other’s position,
intentions and capabilities.

(j) As a Face Saver

* The party, whose case is weak and reluctant to admit defeat, due to prestige,
etc., the conciliator may try for small concession to that party.
(k) As a Promoter of Collective Bargaining
* He is not only concerned with promoting a settlement, but often assists in
collective bargaining and guides the parties in the development of their
relationship.

Types of Conciliation
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1. Voluntary conciliation: Under this, the disputes are referred to the conciliation officer or
Board of Conciliation by both parties of their own free will; they agree to have their
disputes settled by an outsider (without any compulsion of law); but they are free to
accept or not to accept the decision.
2. Compulsory conciliation: Under this, the procedure is made compulsory by provisions
requiring the parties’ attendance at conciliation proceedings or empowering the
conciliation authority to compel their attendance at such proceedings, as well as by the
prohibition of strikes and lockouts without prior resort to conciliation.

Sequential Pattern of Conciliation

The process of conciliation generally follows a sequence consisting of three major
phases:
(i) The Hard Posture Phase: The parties come to conciliation as adversaries (opponents) in an
openly declared dispute. They come with hardened attitudes, which may be indicated in many
ways – inflexibility, adamant defense of position, efforts to discredit the other side, out-of-hand
rejection of opposing views.
During this phase, each party invariably takes the stand that is wholly right and the other
side wholly unreasonable or wrong; neither party can see or will admit any merit in any
argument or proposition put forward by the other side. There may not only be antagonism in any
argument or proposition put forward by the other side. There may not only be antagonism but
open hostility between the parties. Instead of verbal assaults or expressive gestures, there may be
coolness or stiffness in one party’s attitude to the other. During this phase, the conciliator
acquires information of the parties’ position and of the gap which separates them; and on that
basis, he begins his efforts.

(ii) Search for Accommodation: In this phase, each party is primarily concerned with protecting
its own bargaining position. Neither party normally takes the initiative in adopting an
accommodation attitude. The conciliator’s objective is to induce them to adopt a more flexible
attitude and to move closer towards each other. Here, he is concerned with preventing the
discussion from developing into a stalemate which will spell the failure for his efforts.

(iii) Emergence of Appropriate Mood for Settlement of Compromise: During this phase, the
conciliator prods, encourages, and assists the parties to make modified proposals and counter-
proposals. The symptoms, which might indicate the areas of agreement within reach, are the
acknowledgement, by one side that it understands the views expressed by the opposite side. A
friendlier tone may be there, i.e. there might be a direct exchange of comments, which was
formerly entirely absent; or a partial or fragmentary acceptance of the proposal Conciliation is an
art, which includes the art of listening, the art of asking question, the art of timing, and the art of
persuasion. To use this art, various techniques are employed. These techniques are as varied as
the personalities of conciliators. As such many conciliators rely upon a strength forward
approach to the parties; others prefer to work in a subtle and calculated manner. There may be
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conciliators who may be forcefully active in taking initiatives; and others who play a relatively
passive or less aggressive role.

The techniques most frequently used are:

(i) Listening attentively to the parties so that information/facts be gathered;
(ii) Asking questions to obtain information;
(iii) Persuading the parties to overcome their differences and agree upon a compromise by
bringing reason and objectivity to bear on the discussion; by winning their confidence through
such qualities as impartiality, trustworthiness and expertise; and by inducing either party to
abandon a position, or by convincing a party to accept a certain point of view, suggestions or
proposal, or to agree to proposed terms of settlement, In any dispute, the parties are usually
subjected to a multiple reaction of different pressures some of which are inherent in industrial,
disputes; others are created by the conciliator himself. Such pressures are:

(a) Personal
(b) Social and political
(c) Economic

(a) Personal pressure from the conciliator:

It is based on his personal relationship with the parties. “Personal relationship and
pressures are generally considered the mainstay of conciliation statement of facts to a detailed
reasoning and exposition; from appeal to reason to coaxing, wheedling, flattery, cajolery, and ,at
times, criticism, from holding a short meeting to keeping the negotiation in continuous sessions.

(b) Social and political pressure:

This includes the opinions of outsiders whose views are important, and environmental
influences. The parties to a dispute may be influenced by the views of other employers or trade
unions, or of employers’ organizations. Public opinion tends to be important in disputes effecting
the supply of essential goods and services to the community. In some situations such as national
emergencies, or when inflation running wild, there is a greater public concern over the way
disputes are settled and wage claims dealt with.

(c) Economic pressure:

This relates to market conditions and the parties’ bargaining strength. This is the pressure
which parties themselves seek to exert on each other. Pressure for a particular type of settlement
will be generated by the factual situation – rise in living costs, wage increases granted by
comparable firms, wages rates paid by competitors, comparative productivity levels. Economic
pressure is more generally associated with the resort to a strike or lockout.

ARBITRATION
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Arbitration is a means of securing an award on a conflict issue by reference to a third

party. It is process in which a dispute is submitted to an impartial outsider who makes a decision
which is usually binding on both the parties.

Arbitration is to be distinguished from conciliation

 The main objective of arbitration is adjudication and, hence, there is no place for
compromise in awards though the parties are at liberty to do so.
 While the conciliator has to reconcile the recommendations of the parties, sometimes
against his own discretion, as long as he brings about an agreement between the
contending parties, the arbitrator enforces his own point of view on the contending
parties and the opinions of the disputants are not given any predominance.
 Moreover, arbitration is more judicial in character than conciliation.

Types of Arbitration: Arbitration may be ‘voluntary’ or ‘compulsory’.

 Voluntary arbitration implies that the two contending parties, unable to compose their
differences by themselves or with the help of the mediator or conciliator, agree to submit
the conflict/dispute to an impartial authority, whose decision they are ready to accept.

 Compulsory arbitration: It is one where the parties are required to accept arbitration
without any willingness on their part. When one of the parties to an industrial dispute
feels aggrieved by an act of the other, it may apply to the appropriate government to
refer the dispute to adjudication machinery.
- 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 which requires that the wheels of
production should not be obstructed by frequent work-stoppages; or

(iii) The country is passing through grave economic crisis; or

(iv) There is a grave public dissatisfaction with the existing industrial relations; or

(v) Industries of strategic importance are involved; or

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(vi) Parties are ill balanced, i.e., where the unions are weak, ill-organized, and
powerless and the means of production are in the hands of the capitalists who are
well organized and powerful; or

(vii)Public interest and the working conditions have to be safeguarded and

regulated by the state.

Reference of Dispute to Arbitration under Industrial Disputes Act, 1947

Under the Industrial Disputes Act, 1947, a dispute may be referred to arbitration under
the following conditions:
(a) An industrial dispute exists or is apprehended in an establishment;

(b) The employer and the workers agree, in writing, to refer the dispute to arbitration;

(c) The arbitration agreement is in the prescribed form and signed by the parties to it in
the prescribed manner;

(d) The agreement must be accompanied by the consent, in writing, of the arbitrator or
arbitrators;

(e) The dispute must be referred to arbitration at any time before it has been referred to a
labour court or tribunal or a national tribunal;

(f) The reference must be to the person or persons specified in the arbitration agreement
to act as arbitrator/arbitrators;

(g) The arbitration agreement must set forth the issue/issues to be decided by the
arbitration procedure and a copy of the agreement is forwarded to the government and the
conciliation officer.

Qualification of Arbitrators: They should have the following qualifications;

(i) An understanding of the complexities of the labour-management relationship;

(ii) A knowledge of collective bargaining and the operation of arbitration procedures, as

well as skill and experience in the interpretation of collective agreements; and familiarity
with personnel policies, industrial discipline and human relations;
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(iii) High integrity (honesty), that is, they should be non-partisan persons with a deep sense
of impartiality, which requires that they should be free from any commitment to, or
prejudice in favour of, one side or the other;

(iv) They must be committed to the maintenance of harmonious labour management

relations and have a strong belief in the importance of successful arbitration;

(v) They must be acceptable to the parties.

Procedure for Investigation under Arbitration

After the dispute has been referred to the arbitrator, he will hear both the parties. Hearing
involves mastery of the facts of a particular dispute as well as the relevant provisions of the
collective agreement and of the past practices of the parties in relation to matters relevant to the
dispute. An investigation of the facts and circumstances of the dispute is of great importance.
The investigation should aim at ascertaining who and what are involved in the dispute. The
arbitrator may call witnesses; get evidence and relevant records and documents, current and the
past agreements; ordinances, court decisions, statutes (bearing on the case) and arbitration
decisions by other arbitrators in similar cases that may suggest a line of reasoning. When an
important witness is unable to attend, sworn affidavit is often used.

After the collection of facts and supporting materials, arguments take place. Certain principles
are followed by an arbitrator while dealing with a particular dispute, namely:

(i) Fair hearing, which demands that an opportunity should be given to both the parties to
be heard and cross-examined.

(ii) Principle of natural justice requires that a party should have due notice of
proceedings, and it must know what are the issues involved and what part it has to play.
(iii) The party should be free to give any evidence which is relevant to the enquiry and on
which it relies for its arguments.

(iv) The arbitrator should not rely on any document which is not shown and explained to
the other party and to which a reply has not been received.

Submission of Award
The arbitrator, after investigating the dispute, has to submit his award to the government.
The award will have the same legal force as the judgment of a labour court or tribunal. The
award must be signed by the arbitrator.

While writing his award, the arbitrator has to ensure that:

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(i) The award is in line with the terms of reference and that it does not go beyond its
jurisdiction;

(ii) It must be precise and definite, that is, it must be clear, unambiguous and without any,
vagueness, and that it is not in any way capable of being misunderstood or
misinterpreted;

(iii) It should be capable of being enforced or implemented; in other words, it should not
contain directives or provision which apparently seem impossible of enforcement;

(iv) The award should contain a date or a specific period for its implementation;

(v) The award should not violate any provision of any existing law or settlement legally
arrived at, or one which is binding on parties;

(vi) The award should contain sufficient justification or reasons for the settlement arrived
at by the arbitrator.

National Arbitration Promotion Board

To make voluntary arbitration more acceptable to the parties and to co-ordinate efforts
for its promotion, the government appointed, in July 1967, a National Arbitration Promotion
Board with a tripartite composition. The functions of the Board are:

(i) To review the position periodically;

(ii) To examine the factors inhibiting a wider acceptance of this procedure and suggest measures
to make it more popular;

(iii) To compile and maintain up-to-date panels of suitable arbitrators for different areas and
industries and to lay down their fees;

(iv) To evolve principles, norms and procedures for the guidance of the arbitrator and the parties;

(v) To advise parties, in important cases, to accept arbitration for resolving disputes so that
litigation in courts may be avoided;

(vi) To look into the cause or causes of delay and expedite arbitration proceedings, wherever
necessary;

(vii) To specify, from time to time, the types of disputes this would normally be settled by
arbitration in tripartite decisions.
 18

ADJUDICATION

Adjudication involves intervention in the dispute by a third party appointed by the

Government for the purpose of deciding the nature of final settlement.

Types of Adjudication
When the government gets a report of the failure of conciliation proceedings, it has to
decide whether it would be appropriate to refer the dispute to arbitration. The reference of
dispute to adjudicating is at the discretion of the government When both parties, at their own
accord, agree to refer the dispute to adjudication, it is obligatory on the part of the government to
make a reference. When a reference to adjudication is made by the parties, it is called Voluntary
Adjudication.

On the other hand, when reference is made to adjudication by the government without the
consent of either or both the parties to the dispute, it is known as Compulsory Adjudication.

Three-Tier System of Adjudication

The Industrial Disputes Act, 1947 provides for a three-tier system of adjudication
(1) Labour Courts;
(2) Industrial Tribunals; and
(3) National Tribunals.
These are the adjudication bodies which decide the disputes refereed to them by the appropriate
government and pass their awards. The Labour Courts adjudicate upon disputes listed in
Schedule II of the Act. The Industrial Tribunals adjudicate upon disputes which are of national
importance, or when the dispute is of such a nature as to effect industrial establishment situated
in more than one state.

COMMENCEMENT AND CONCLUSION OF PROCEEDINGS

The proceeding before a labour court, tribunal or national tribunal is deemed to have
commenced on the date of the reference of the dispute for adjudication. The proceedings before
the labour court, tribunal or national tribunal are deemed to have concluded on the date on which
the award becomes enforceable. The Act provides that any information obtained by the labour
court, tribunal or national tribunal is not to be included in nay report or award.

(i) In the course of any investigation or enquiry as to a trade union or as to any other
individual business:
 19

(ii) If such information is not available otherwise than through evidence before such
officer or court or tribunal.

(iii) If the trade union, person, firm or company in question has made a request in writing
to the authority concerned that such information shall be treated as confidential.

Neither the authority nor any person present at or concerned in the proceedings is allowed
to disclose any information, or contents of any document claimed to be confidential, without the
consent in writing of the secretary of the trade union or other person, firm or company , as the
case may be.

CENTRAL INDUSTRIAL RELATIONS MACHINERY IN INDIA

The Central Industrial Relations Machinery was set up in 1945, with the Chief Labour
Commissioner as Head of the Department. The purpose was to give effect to the various
provision of the Industrial Disputes Act – for the prevention, investigation and settlement of
disputes in the industries in the Central sphere and the enforcement of awards, settlement of
other labour laws of which the responsibility is vested in the Central Government. The specific
functions of C.I.R.M are as under.

(1) “Prevention and settlement of industrial disputes in industries located in the central sphere
(for which the Central Government is “appropriate government” under the Industrial Disputes
Act, 1947)
(2) “Enforcement of labour laws in industries and establishments located in the central sphere
((for which the Central Government is “appropriate government” under the relevant labour
laws).

(3) “Verification of Membership of trade unions in nationalized banks for identification of the
representative union to facilitate the appointment of workers director on the board of directors.

(4) “ad hoc verification of membership of trade unions in major prots.

(5) “Verification of membership of registered trade unions affiliated to the Central Trade Union
Organisations (CTUOs) to determine the strength of CTUOs for the purpose of giving
representation to CTUOs on national and international force.

(6) “Enforcement of awards and settlements.

(7) “Conduct of enquiries into the breaches of code of discipline.

(8) “Promotion of Works Committees and workers’ participation in management

 20

(9) “Collection of statistical information in the central sphere pertaining to industrial disputes,
work stoppages ages, labour situation and labour regulation.

(10)“Defence of Court cases and writ petitions arising out of implementation of labour laws”

The C.I.R.M is located at Delhi, headed by the Chief Labour Commissioner (Central)
(C/L/C (C)). He is assisted by 31 officers who perform line and staff functions. In the field set-
up, C.L.C had 18 (RLC), 70 Assistant Labour Commissioners and 160 Labour Enforcement
Officers. So it can be said that C.I.R.M. is well spread in different parts of country with zonal,
regional and unit level formation as depicted in the organ gram.
The central machinery operates in 18 regions each headed by Regional Commissioner
with headquarters at Ajmer, Ahmedabad, Asansol, Bombay , Bangalore, Bhuvaneshwar,
Chandigarh, Calcutta, Cochin, Dhanbad, Guwahati, Hyderabad, Jabalpur, Kanpur, Chennai, New
Delhi, Nagpur and Patna. The central machinery also includes Courts of Enquiry, labour courts,
Industrial and National tribunal and the State Arbitration Board. The CIRM with a view to check
the exploitation of unorganized workers undertakes inspection of the establishments with
specific reference to enforcement of labour laws.

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