Block 3

The Trade Unions
Act, 1926
UNIT 13 THE TRADE UNIONS ACT, 1926
Objectives
After going through this unit you should be able to understand:

• Various provisions of Trade Unions Act, 1926
• Scope and Coverage of the Act
• Registration Cancellation, Dissolution etc. of Trade Unions
• Obligations of Trade Unions
• Rights of Registered Trade Unions
• Various Amendments which are required in the Act
Structure
13.1 Introduction
13.2 Scope and Coverage
13.3 Administration
13.4 Registration of Trade Unions
13.5 Cancellation of Registration
13.6 Dissolution of Trade Unions
13.7 Penalities
13.8 Obligations of Registered Trade Unions
13.9 Rights of Registered Trade Unions
13.10 General Remarks
13.11 Conclusion
13.1 INTRODUCTION
Beside the Bombay Industrial Relaltions Act, 1946, and the Maharashtra Recognition
of Trade Unions and Prevention of Unfair Labour Practices Act, 1971, Trade Unions
Act, 1926 is the only legal framework for the trade unions by conceding to workmen
their right of association and organising unions. It permits any seven persons to form
their union and get it registered under the Act Registration of unions is optional and
not compulsory. The National Commission on Labour (1969) recommended
compulsory recognition of trade unions, but this recommendation is still under the
consideration of the Government. However, the (1982) amendment of the Industrial
Disputes Act, 1947, makes registration compulsory virtually by defining the term
"Trade Union", for the purposes of this Act, as a Union registered under the Trade
Unions Act, 1926. This gives Unions certain rights and immunities which
unregistered Trade Unions do not enjoy. Therefore, workers tend to be members of
registered trade unions.
Besides specifying the procedure for registration of union, this Act lays down the
guidelines for the day to day working of the registered unions. It also defines their
rights and obligations, important of which are as follows:
Collective bargaining gave fillip to passing of the Trade Union Act, 1926.
13.2 SCOPE AND COVERAGE

The expression "Trade Union" under the Act includes both employers and workers
organizations Employers organisations also can be registered as trade unions. The
intention is to place both on par in matters of rights and responsibilities. It is
primarily the objective of an association or combination which determines whether it 5
is a trade union or not.
Industrial Relations Laws
The federation of two or more trade unions mentioned in the definition can be seen in
shape of Industrial Federations of Trade Unions.
Bomaby Industrial Relations Act, 1948 is .the most important state enactment. The
relevant features of the act are (a) compulsory recognition of union by employer, (b)
giving the right to workers to get their case represented either through representative
union or where there is no representative union in industry/centre/unit through
elected representative of workers or through Government labour officer.
There is no provision in the Trade Unions Act, 1926 about sorting out inter or intra
trade union disputes. In such eventuality, aggrieved party has to take recourse to
common law of the land and redressal through courts.
This Act extends to the whole of India. Under the Act, the term "Trade Union" is
defined as any combination whether temporary or permanent, formed primarily for
the purpose of regulating the relations between workmen and employers, or between
workmen and workmen, or between employer and employers, or for imposing
restrictive conditions on the conduct of any trade of business, and includes any
federation of two or more trade unions. In other words, a trade union is a combination
or association of not only of workmen but also of the employers. The Act, therefore,
applies not only to the unions of workers but also to the associations of employers.
(Sec. 2h)
13.3 ADMINISTRATION
This Act is a Central legislation, but it is administered and enforced by the State
Governments. They appoint Registrars of Trade Unions, and also Additional or
Deputy Registrars who may exercise the functions of the Registrar. They have also
the powers to make rules for giving effect to the provisions of the Act. (Sec. 3)
13.4 REGISTRATION OF TRADE UNIONS
This is really the main provision of the Act. Any seven or more members of the union
can form a trade union and apply to the Registrar for its registration by subscribing
their names to its rules. The application for registration should be accompanied by a
copy of the rules of the union and a statement containing particulars, namely: (a) the
names, occupations and addresses of the members making the application; (b) the
name of the trade union and the address of its head office; and (c). the titles, names,
ages addresses and occupations of the office bearers of the trade union; If the union
has been in existence for more than a year before applying for registration, the
Registrar should also be supplied a statement in the prescribed form showing the
assets and liabilities of the union. The Registrar may not register the trade union
unless its executive is constituted in accordance with the provisions of this Act, and
its rules mentioned clearly the name and objects of the union, and the purpose for
which its funds are to be used. Not more-than 50% of members of the executive
committee can be outsiders. The rules should also provide for the maintenance of a
list of the membership of the union and adequate facilities for the inspection thereof
by the officers and members of the union; procedure for the admission of ordinary,
honorary or temporary members, rate of subscription not being less than 25 paise per
month per member; the manner of amending, varying or rescinding rules; manner of
appointing members of the executive committee and other officers of the trade union,
safe custody of funds and their spending for the purpose specified in the Act; annual
audit and inspection of account books by the officers and members; and the manner
of dissolution of the trade union, or changing its name. The Registrar has the power
to call for any further information, and also alter the name of the union, if it is
identical with that of any other registered union. He registers the union by recording
its particulars in a register and issuing a registration certificate. (Sec. 4 to 9)
The federation of trade unions also require registration. It was held in National
Organisation of Bank Workers' Federation of Trade Unions Vs. Union of India and
others (Bombay - 1993) that where a federation of Trade Unions is not registered, it
is not a trade union under the Act. It is not a juristic person and it is not competent to
raise a demand on behalf of employees which can fall in the ambit, of Industrial
6
Disputes. It cannot file a writ petition.
UNIT 14 THE INDUSTRIAL DISPUTES

ACT, 1947-I
Objectives
After going through this unit, you will be able to understand:

• the scope, coverage and important concepts regarding industrial disputes
• principal objectives of the Act
• various machineries for investigation and settlement of disputes
• about settlement, awards, etc
Structure
14.1 Introduction
14.2 The Principal Objectives of the Act
14.4 Measures for Prevention of Conflicts and Disputes
14.5 Machineries for Investigation and Settlement of Disputes
14.6 Conciliation
14.7 Voluntary Arbitration
14.8 Adjudication
14.9 Awards of Labour Courts and Industrial Tribunals
14.10 Protection of Workmen during Pendency of Proceedings
14.11 Powers of Labour Courts and Industrial Tribunals
14.12 Effectiveness of Adjudication Machinery
14.1 INTRODUCTION
Based on the experiences of Trade Disputes Act, 1929 and usefulness of rule 81 (a)
of the Defence of India Rules, the bill pertaining to Industrial Disputes Act, 1947
embodied the essential principles of rule 81 (a) which was acceptable to both
employers and workers retaining most parts of the provisions of Trade Disputes Act,
1929.
This legislation is designed to ensure industrial peace by recourse to a given form of
procedure and machinery for investigation and settlement of industrial disputes. Its
main objective is to provide for a just and equitable settlement of disputes by
negotiations, conciliation, dedication, voluntary arbitration and adjudication instead
of by trial of strength through strikes and lock-outs.
As State Governments are free to have their own labour laws, States like UP.,MP.,
Gujarat and Maharashtra have their own legislation for settlement of disputes in their
respective states. U.P. legislation is known as U.P. Industrial Distputes Act, while
others have Industrial Relations Act more or less on the lines of 'Bombay Industrial
Relations Act, 1946.
14.2 THE PRINCIPAL OBJECTIVES OF THE ACT
a) promotion of measures for securing amity and good relations between employer
and workmen
10 b) Investigation and settlement of industrial disputes
The Industrial Disputes
c) Prevention of illegal strike and lock-outs Act, 1947-I
d) Relief to workmen in the matter of lay-off, retrenchment and closure of an
undertaking
e) Promotion of Collective Bargaining
The Industrial Disputes Act, 1947, extends to the whole of India, and is applicable to
all industrial establishments employing one or more workmen. It covers all
employees both technical and non-technical, and also supervisors drawing salaries
and wages upto Rs.1600 per month. It excludes persons employed in managerial and
administrative capacities and workmen subject to Army Act, Navy Act, Air Force
Act and those engaged in police, prison and civil services of the Government. As
regards disputes, it covers only collective disputes or disputes supported by trade
unions or by substantial number of workers and also individual disputes relating to
termination of service. For purposes of this act the term "dispute" is defined as
dispute or difference between employers and employees, which is connected with the
employment and non-employment or the terms of employment or with the condition
of labour of any person.-section 2(k)
Section 2 (a) defining appropriate Government states, inter alia: (a) In relation to any
industrial disputes concerning any industry carried on by or under the authority of
Central Government or by a Railway or concerning any such controlled industry such
as may, be specified or linking or insurance company or oil field or major part the
Central Government, and (b) In relaltion to other industrial disputes the State
Government: In HEC Majdoor Union Vs. State of Bihar S.C. (1969), it was held that
in respect of Central Public Sector Undertakings the State where the factory was
situated was the appropriate Government. This decision was changed in Air India
case S.C. 1997 where it was held that in resepct of Central Public Undertakings the
appropriate Government is the Central Government. This definition of appropriate
Government is applicable to contract labour (R&A) Act, 1970 and Payment of Bonus
Act, 1965.
The term "Industry" includes not only manufacturing and commercial establishments
but also professionals like that of the lawyers, medical practitioners, accountants,
architects, etc., clubs, educational institutions like universities, cooperatives, research
institutes, charitable projects and other kindred adventures, if they are being carried
on as systematic activity organised by cooperation between employers and
employees for the production and/or distribution of goods and services calculated to
satisfy human wants and wishes. It also includes welfare activities or economic
adventures or projects undertaken by the government or statutory bodies, and,
Government departments discharging sovereign functions if there are units which are
industries and which are substantially severable units. (Judgement dated 21.2.78 in
the civil appeals no. 753-754 in the matter of Bangalore Water Supply & Sewerage
Board etc. Vs. Rajappa & Sons, etc.).
Sec. 2 (s) defines "workman" as any person (including an apprentice) employed in
any industry to do any skilled, unskilled manual, supervisory, operational, technical
or clerical work for hire or reward. Whether the terms of employment be expressed or
employed and for the purposes of any proceedings under this act in relation to an
industrial dispute, includes any such person who has been dismissed, discharged,
retrenched in connection with or as a consequence of that dispute or whose dismissal,
discharge or retrenchment has led to that dispute but does not include any such
person (i) who is subject to Air Force Act, Army Act or Navy Act or (ii) who is
employed in police service or prison service, (iii) who is employed mainly in a
managerial and advisory capacity or (iv) who being employed in supervisory capacity
ity draws wages exceeding Rs.1600/- and exercises by the nature of the duties
attached to the office or by means of powers vested in him, functions mainly of a
managerial nature. May and Baker India case S.C. (1976) which led to passing of
Sales Promotion Employees Act, 1976, had been stipulated that sales /medical
representatives are not workmen under Sec. 2(s) of ID Act.
The provisions of ID Act, 1947 will be applicable to certain class of working
journalists as per section 3 of Working Journalists Act 1955. 11
14.4 MEASURES FOR PREVENTION OF CONFLICTS
AND DISPUTES
The Act not only provides machinery for investigation and settlement of disputes, but
also some measures for the containment and prevention of conflicts and disputes.
Important preventive measures provided under the Act are:
1. Setting up of Works Committees in establishments employing 100 or more
persons, with equal number of representatives of workers and management for
endeavouring to compose any differences of opinion in matters of common
interest, and thereby promote measure for securing and preserving amity and
cordial relations between the employer and workmen. The representatives of
workmen will not be less than the representatives of employers and such
representatives of workmen will be from among the workmen engaged in the
establishment and in consultation with registered trade unions. The decision of
the works committee carries weight but is not conclusive and binding; its duties
is to smooth away friction then to alter conditions of services, etc. (Section 3).
2. Prohibition of changes in the conditions of service in respect of matters laid
down in the Fourth Schedule of the Act (Appendix-1) (a) without giving notice
to the workmen affected by such changes; and (b) within 21 days of giving such
notice. No such prior notice is required in case of (a) Changes affected as a
result of any award or settlement; (b) Employees governed by Government.
rules and regulations (see 9A).
3. Prohibition of strikes and lock outs in a public utility service (a) without giving
notice to other party within six weeks before striking or locking out, (b) within
14 days of giving such notice, (c) before the expiry, of the date of strike or lock-
out specified in the notice and during the pendency of any conciliation
proceedings before a conciliation office and seven days after the conclusion of
such proceedings. In non-public utility services strikes and lock out are
prohibited during the pendency of conciliation proceedings before the Board of
Conciliation and seven days after the 'conclusion of such proceedings, during the
pendency of proceedings before an arbitrator, labour court, and Industrial
Tribunal and National Tribunal, during the operation of an award and settlement
in respect of matters covered by the settlement or award. (Sections 22 and 23).
4. Prohibition of Unfair Labour Practices: Sec. 25 T and 25 U prohibit employers,
employees and unions from committing unfair labour practices mentioned in the
Schedule V of the Act (Appendix-In. Commission of such an offence is
punishable with imprisonment upto six months and fine upto Rs.1000, or both.
(Ch. V -C)
5. Requiring employers to obtain prior permission of the authorities concerned
before whom disputes are pending for conciliation, arbitration and adjudication,
for changing working and employment conditions, or for dismissal or
discharging employees and their union leaders. (Section 33).
6. Regulation, of lay-off and retrenchment and closure of establishment: Sec. 25
and its' sub-sections require employers to (a) pay lay-off compensation to
employees (in establishments employing 50 or more) for the period that they are
laid-off, at the rat of 50% of the salary or wages which they would have paid
otherwise, (b) give one month notice, and three months notice in case of
establishments employing 100 or more persons or pay in lieu of notice, and also
pay compensation at the rate of 15 days wages for every completed year of
service for retrenchment and closing establishments (c),-Retrench employees on
the basis of first come last go, and (d) obtain permission from the Government
for retrenchment and laying off employees and closing, of establishments
employing 100 or more persons. (Ch. VA, VB)
14.5 MACHINERIES FOR INVESTIGATION AND
SETTLEMENT OF DISPUTES
For Industrial; disputes which are not. prevented or settled by, collective bargaining
or Works Committees or by Bipartite negotiations, the following authorities are
12 provided under the. Industrial Disputes Act for resolving the same.
a) Conciliation Officer and Board of Conciliation Act, 1947-I
b) Voluntary Arbitration
c) Adjudication by Labour Court, Industrial Tribunal, and National Tribunal
14.6 CONCILIATION
Conciliation in industrial disputes is a process by which representatives of
management and employees and their unions are brought together before a third
person or a body of persons with a view to induce or persuade them to arrive at some
agreement to their satisfaction and in the larger interest of industry and community as
a whole. This may be regarded as one of-the phases of collective bargaining and
extension of process of mutual negotiation under the guidance of a third party, i.e.
Conciliation Officer, or a Board of Conciliation appointed by the Government.
Both the Central and State Governments are -empowered under the Industrial
Disputes Act, 1947 to appoint such number of conciliation officers as may be
considered necessary for specified areas or for specified industries in specified areas
either permanently or for limited periods.
The main duty of a Conciliation Officer is to investigate and promote settlement of
.disputes. He has wide discretion and may do all such sthings, as he may deem fit to
bring about settlement of disputes. His role is only advisory and mediatory. He has
no authority to make a final decision or to pass formal order directing the parties to
act in a particular manner.
Process of Conciliation
Where any industrial dispute exists or is apprehended, and is brought to the notice of
conciliation officer by the parties concerned, or is referred to him by the government,
or he receives a notice of strike or lock-out, he is to hold conciliation proceedings in
the prescribed manner. Conciliation proceedings are obligatory in case of public
utility services, and in such cases conciliation proceedings have to be started
immediately after receiving notice of strike or lock-out or reference from the
Government. In such cases conciliation proceedings are deemed to have commenced
from the time the notice of strike is received by the conciliation officer. In other cases
conciliation may be initiated at the discretion of the Government. The conciliation
officer' may send formal intimation to the parties concerned declaring his intention to
commence conciliation proceedings with effect from the date he may specify. He
may hold meetings with the parties to the dispute either jointly or separately. A joint
meeting saves time and also affords parties an opportunity to meet each other and put
forward their respective view points and comments about the dispute. Conciliation
proceedings are to be conducted expeditiously in a manner considered fit by the
conciliation officer for the discharge of his duties imposed on him by the Act, If a
settlement is arrived at in the course of the conciliation proceedings, memorandum of
settlement is worked out and signed by the parties concerned, and it becomes then
binding on all parties concerned for a period agreed upon.
The conciliation officer is to send a report to the Government giving full facts along
with a copy of the settlement. If no agreement is arrived at, the-conciliation- officer is
required to submit a full report to the Government explaining the causes -of :failure.'
After considering the failure report the Government may refer the dispute to the
Board of Conciliation, arbitration, or for adjudication to Labour Court or Industrial
Tribunal. If the Government does not make such a reference, it shall record and
communicate to the. parties concerned the reasons thereof. While exercising its
discretion, the Government must act in a bonafide manner and on consideration of
relevant matters and facts. The reasons must be such as to show that the question was
carefully and properly considered. The conciliation officer has to send his report
within 14 days of the commencement of conciliation proceedings, and this period
may be extended as may be agreed upon by the parties in writing.
The conciliation officer is not h judicial officer. After reporting that no settlement
could be arrived at, he cannot be debarred from, making fresh effort to bring about a
settlement. 13
But he cannot take final decision by himself.
Powers of Conciliation Officer
Under the Act, conciliation is not a judicial activity. It is only administrative, since it is
executed by the Government agency. Although conciliation officer is not a judicial
officer, but to enable him to discharge his duties cast upon him under the Act, he has
been empowered to enter the premises occupied by an establishment to which the
dispute relates after giving reasonable notice for inspecting same, or any of its
machinery, appliances or articles. He can also interrogate any person there in' respect of
any thing situated therein or any matter relevant to the subject matter of conciliation.
He can also call for any document which he has ground for considering relevant in the
dispute, or to be., necessary for the purposes of verifying the implementation of any
award or carrying out any other duty imposed on him under the Act. He is also
empowered to enforce the attendance of any person for the purpose of examination of
such persons. For all these purposes the conciliation officer shall have the same power
as are vested in a Civil Court under the Code of Civil Procedure. He is also deemed to
be public servant within the meaning of Sec. 21 of the Indian Penal Code:
Settlements In and Ouside Conciliation
A settlement arrived at in proceedings under the Act is binding on all the parties to the
dispute. It is also binding on other parties if they are summoned to appear in
conciliation proceedings as parties to the dispute: In case' of employer such a
settlement is also binding on his heirs, successors, assigns in respect of establishment
to which these disput relate. In regard to employees, it is binding on all persons who
were employed in establishment or part of the establishment to which the dispute'
relates on the date of dispute, and to all persons who subsequently become employed
in that establishment.
A settlement arrived at by agreement between the management and workers or their
unions outside conciliation. proceedings is binding only on the parties to the
agreement. (Section 18).
Board of Conciliation
This is a higher forum which is constituted for a specific dispute. It is not a permanent
institution fake the Conciliation Officer, The Government may, as occasion arises,
constitute a Board of Conciliation for settlement of an industrial dispute with an
independent chairman and equal representatives of the parties concerned as its members.
. The chairman who is appointed by the Government, is to be a person unconnected with
the dispute or with any industry directly affected by such dispute. Other members are to
be appointed on the recommendations of the parties concerned; and if any party fails to
make recommendation, the Government shall appoint such persons as it thinks fit to
represent that party. The Board cannot admit a dispute in conciliation on its own.-It can
act only when reference is made to it by the Government. (Section 5).
As soon as a dispute is referred to a Board, it has to endeavour to bring about a
settlement of the same.. For this purpose, it has to investigate the dispute and all matters
affecting the merits and right settlement thereof, for the purpose of inducing the parties
to come to a fair and amicable settlement. Procedure followed by the Board in this
regard is almost the same as adopted by the conciliation officers. The Board is, however,
required to submit its report within two months of the date on which the dispute was
referred to it, or within such short period as the Government may fix in this behalf. The
proceedings before the Board are to be held in public, but the Board may at any stage
direct that any witness shall be examined or proceedings shall be held in camera.
If a settlement is arrived at, a report with a copy of the settlement is submitted, to the
Government. If the Board fails to bring about settlement, a report is submitted to the
Government stating the facts and circumstances, the steps taken, reasons for failure
along with its findings. After considering its findings the Government may refer the
dispute for voluntary arbitration if both the parties to the dispute agree for the same,
or for 'Adjudication to Labour Court or Industrial Tribunal or National Tribunal.
There period of submission of report may be extended by the Government beyond
two months as agreed upon by the parties in writing. A member of the Board may
record any minute of dissent from the report, or from any recommendation made
therein. With the minute of dissent the report shall be published by, the Government
14 within thirty days from the receipt
thereof. A Board of Conciliation can only try to bring about a settlement. It has no Act, 1947-I
power to impose a settlement on the parties to the dispute. The Board has the power
of a Civil Court for,(i) enforcing the attendance of any person and examining on oath;
(ii) compelling the production of documents and material objects; (iii) issuing
commissions for the examination of witnesses. The enquiry or investigation by the
Board is regarded as judicial proceedings.
The Boards of conciliation are rarely appointed by the Government these days. The
original intention was that major disputes should be referred to a Board and minor
disputes shout be handled by the conciliation officers. In pracice,, however, it was found
that when the Parties to the dispute could not come to an agreement between themselves,
their representatives on the Board in association with independent chairman (unless latter
had the role of n umpire or arbitrator), could rarely arrive at a settlement. The much more
flexible procedure followed by the conciliation officer is found to be more acceptable.
This is more so when disputes relate to a whole industry, or important issues, and a senior
officer of the Industrial Relations Machinery, i.e. a senior officer of the Directorate of
Labour, is entrusted with the work of conciliation. The Chief Labour Commissioner
(Central) or Labour Commissioner of the State Government generally intervene
themselves in conciliation when important issues form the subject matters of the dispute.
Court of Inquiry may be constituted for inquiring about matter appearing to be
connected with or relevant to an I.D. The court may consist of one or more
independent persons. It has to submit its report within six months on the matter
referred to Units. (Sec. 6).
14.7 VOLUNTARY ARBITRATION
When Conciliation Officer or Board of Conciliation fail to resolve conflict/dispute,
parties can be advised to agree to voluntary arbitration for settling their dispute. For
settlement of differences or conflicts between two parties, arbitration is an age old
practice in India. The Panchayat system is based on this concept. In the industrial
sphere, voluntary arbitration originated at Ahmedabad in the textile industry under
the influence of Mahatma Gandhi. Provision for it was made under the Bombay
Industrial Relations Act by the Bombay Government along with the provision for
adjudication, since this was fairly popular in the Bombay region in the 40s and 50s.
The Government of India has also been emphasising the importance of voluntary
arbitration' for settlement of disputes in the labour policy chapter in the first three
plan documents, and has also been advocating this step as an essential feature of
collective bargaining. This was also incorporated in the Code of Discipline in
Industry adopted at the 15th Indian Labour Conference in 1958. Parties were
enjoined to adopt voluntary arbitration without any reservation. The position was
reviewed in 1962 at the session of the Indian Labour Conference where it was agreed
that this 'step would be the normal method after conciliation effort fails, except when
the employer feels that for some reason he would prefer adjudication. In the
Industrial Trade Resolution also which was adopted at the time of Chinese
aggression, voluntary arbitration was accepted as a must in all matters of disputes.
The Government had thereafter set up a National Arbitration Board for making the
measure popular in all the states, and all efforts are being made to sell this idea to
management and employees and their unions.
In 1956 the Government decided to place voluntary arbitration as one of the measures
for settlement of a dispute through third party intervention under the law. Sec. 10A
was added to the Industrial Disputes Act, and it was enforced from 10th March, 1957.
Reference of Disputes for Arbitration
Where a dispute exists or is apprehended, it can be referred for arbitration if the parties
to the dispute agree to do so by submitting a written agreement to that effect,
mentioning the person acceptable to them as arbitrator and also the issues to. be
decided in arbitration - proceedings, to the Government and the Conciliation Officer
concerned before it is referred for adjudication to Labour Court or Tribunal. The
Agreement must be signed by both the parties. Both under Sec. 10A and 10(2)
reference is obligatory.
Where an agreement provides for even number of arbitrators, it will provide for the 15
appointment of another person as an Umpire who shall decide upon the reference if the
Act, 1947-II
UNIT 15 THE INDUSTRIAL DISPUTES
ACT, 1947-II
Objectives
After studying this unit, you will be able to understand:
• The implications of notice of change

• Protection of workmen during pendency of proceedings
• Prohibition on Strikes/Lockouts
• Various implications and reliefs for Lay-Off, Retrenchment and Closure
• About Unfair Labour Practices
Structure
15.1 Introduction
15.2 Notice of Change in Employment Conditions
15.3 Protection of Workmen During Pendency of Proceedings
15.4 Strikes and Lock-Outs
15.5 Lay-off Compensation
15.6 Retrenchment Compensation
153 Procedures for Retrenchment
15.8 Compensation to Workmen in Case of Transfer of Undertakings
15.9 Closure
15.10 Re-opening of Closed Undertakings
15.11 Unfair Labour Practices
15.12 Recovery of Money due from Employer
15.13 Representation of Parties
15.14 Powers of Exemption
15.15 Penalties
15.16 Conclusion and General Remarks
15.1 INTRODUCTION
Arbitrariness of employers in respect of changes to be affected and victimisation of
workmen who dared to take up the cause of workmen, were common phenomenon in
early days of industrialisation. Similarly, reckless incidents of strikes and lock outs
used to mar the efforts for peaceful industrial relations.
While the employers have compulsions to resort to lay-off, retrenchment and closures
because of natural financial, technological and market-forces, the workmen have
their own problems of redundancies, unemployment and livelihood.
This part deals with these peculiar and specific subjects of Industrial Relations. While
Act provides for compulsory consultation of workers before affecting vital change
and guarantees protection to the workmen during pendency of proceedings, it tries to
prohibit strikes and lock-outs in the greater interest of society by providing checks
and balances. The Act goes beyond, to protect workers' interests in event of lay-off,
retrenchment and closure. Besides reliefs, the amended Act makes it compulsory for
the employer to obtain prior permission of appropriate Government, which is
23
difficult, and time-consuming; that is why, it is resented by employer very much.
15.2 NOTICE OF CHANGE IN EMPLOYMENT

CONDITIONS
The Act stipulates that no employer will effect any change in the conditions of
service in respect of matters laid down in the Fourth Schedule of the Act:
a) Without giving notice to the workmen affected by such change, and
b) Within 21 days of giving such notice
No such prior notice is required in case of
a) change affected as a result of any award or settlement or decision of the court
under the I.D. Act, and
b) employees governed by Government Rules and Regulations
The logic and object of enacting Sec. 9A is to afford opportunity to the workmen to
consider the effect of proposed changes and if necessary to present their views on the
proposal for change. This was to stimulate the feeling of common/joint interest. This
approach may be viewed as egalitarian and progressive trend which strives to see the
capital and labour as co-sharer and to break away from the transition of labours
subservience to capital-TISCO Vs. the Workmen ILI. 1972.
The Government has the power to exempt any establishment from this provision of
the Act if it is considered necessary in public interest. (Sec. 9A, 9B).
15.3 PROTECTION OF WORKMEN DURING PENDENCY

OF PROCEEDINGS
During the pendency of any conciliation, adjudication and arbitration proceedings
before a conciliation officer, Board of Conciliation, Arbitrator, Labour Court, and
Tribunal in respect of any dispute, no employer can alter the conditions of service to
the prejudice of the workmen concerned with the dispute, and nor can he dismiss or
punish any such workmen without obtaining the written permission of the authority
concerned. In respect of matters not connected with the dispute, the employer may
alter the existing conditions applicable to him, and also proceed against his for any
misconduct-in accordance with the standing orders of the terms of the contract
applicable to him. If such action involves dismissal or discharge, the employer must
pay the workman wages for one month and simultaneously apply to the authority for
approval of such action. A limited number of representatives of workman knows as
"Projected Workmen" are given such protection in all matters whether connected
with the dispute or otherwise. A protected workman means in an establishment a
workman who being an officer of a registered trade union connected with the
establishment, is recognised as a protected workman under the Rules framed under
the Act. The number of such protected workmen is limited to 1% of the total .
workmen employed in an establishment, subject to minimum number of five and
maximum number of one hundred. A workman aggrieved by the contravention of this
provision of the Act can make a compliant in writing direct to the conciliation officer
and the board of conciliation for mediation and settlement, and to the Labour Court,
Industrial Tribunal and National Tribunal, before whom the dispute is pending for
adjudication. On receipt of such complaint or application the authority concerned
shall try to mediate and adjudicate upon it as if it was a dispute referred to or pending
before it, and pass necessary award or order expeditiously. Similarly application from
an employer seeking permission to alter conditions of service, or for taking
disciplinary action during the pendency of any proceedings before any authority, is to
be dealt with. Applications and complaints received from employees and employers
under this provision of the Act shall be displosed of within three months from the
date of their receipt. The period can be extended if the parties concerned apply for
such extension, or the authorities concerned may consider expedient so for the
reasons to be recorded (Sec. 33, 33A).
15.4 STRIKES AND LOCK-OUTS
24 In a public utility service strikes and lock-outs are prohibited (a) without giving notice in
the prescribed manner to the other party within six weeks before striking or lock-out; Act, 1947-II
(b) within 14 days of giving such notice; (c) before the expiry of the date of strike or
lock-out specified in the notice; and (d) during the pendency of any conciliation
proceedings before a conciliation officer and seven days after the conclusion of such
proceedings.
Notice of strike or lock-out is not necessary in the case of strike or lock-out already
in existence in the public utility services. But the employer shall send, intimation of
such lock-out or strike on the day it is declared to the authority specified by the
Goverment. If on any day an employer carrying on any public utility service receives
from any person employed by him a notice of strike or issues to such person notice-
of lock-out, he is to send report to the appropriate Government; or the authority
specified by the Government, within five days the number of such notices received or
given on that day.
General Prohibition of Strike and Lock-Out: Strikes and. Lock-outs are prohibited in
any establishment a) during the tendency of conciliation-proceedings before a Board
of conciliation and seven days after the conclusion of such proceedings, b) during the
pendency of proceeding before an arbitrator,- a Labour Court; Tribunal and National
Tribunal, and two months after the conclusion of such proceedings; and, c) during the
period in which a settlement or award is in operation in respect of any of the matters
covered by the settlement of award.
Any strike or lock-out commenced or declared in. contravention of the above, or if it
is continued in contravention of the order of the Government prohibiting the same, is
deemed to be illegal No person is to finance knowingly an illegal strike or lock-out.
Any loch-out, or strike declared in consequence of an illegal• strike or lock-out,
respectively, is to, be considered as legal, (Sec. 22, 23, 24, 25).
Legal and illegal strike/according to Sec. 24(1), a strike shall be illegal if it is-
1. Commenced or declared in contravention of Sec. 22 in a public utility service
2. Commenced in contravention of Sec. 23 in any industrial establishment (both
public utility and non-public utility)
3. Continued in contravention of Sec. 10(3) or sub-sec. (4-A) of Sec. 10-A of the
act.
4. According to Sec. 24 (3) strike declared in consequence of illegal lock-out shall
not be deemed to be illegal. The opposite of it is also equally to.
Justified and unjustified strike-a strike can be set to be justified if taken recourse to
for good reason and carried out in orderly and peaceful manner. An. unjustified strike
is one where wokmen have raised unreasonable demand, have not given reasonable
time to employer to discuss and have shown objectionable behaviour leading to
violence etc.
In Crompton Greaves Vs. The Workmen S.C. (1978) has held that in order to entitle
the workmen for wages for the period of strike, the strike should be legal as well as
justified. A strike is legal if it does not violate the provisions of the statute. A strike
cannot be said to be unjustified unless the reasons for it are entirely perverse or
unreasonable. -The use of force, violence, sabotage etc. adopted by workers, deny
them the wages for strike period.
In Gujarat steel tube case S.C. (1980); the S.C. rejected the theory of community
guilt and collective punishment and ruled that no. worker will be dismissed save on
the, proof of his individual deliquesce.
In Bharat Union Palicha. Vs. State of Kerala the full bench of Kerala. High Court
held bundh to be illegal, unconstitutional and violative of Articles 19 and' 21 of the
Constitution. This was also upheld by Supreme 'Court (1997}
Strike under ID act unlike Bombay industrial relations act need not be related with
pending disputes; there is a provision for work stoppage in BIR Act. A concept of
stoppage is wider than strike.
15.5 LAY-OFF COMPENSATION

Chapter VA deals essentially with a social security problem rather than an industrial
25
relation problem.
Chapter V-A of the Act makes it obligatory for all industrial establishment which
(a) are not seasonal, or do not work intermittently, and (b) employ 50 or more
workmen, to pay lay-off compensation to their workmen, at the rate of 50% of
the total of basic wages and dearness allowance which would have been payable
to them if they had not been laid off.
Explanation: Industrial establishment for the purpose of Chapter V A means
factories as defined under the Factories Act, Mines as defined under the Mines Act
and Plantations as defined under the Plantations Labour Act.
a) The workmen who is laid off, must be on the muster roll of the establishment,
and he should not be a casual or badli (substitute) worker.
b) He has completed not less than one year of continuous service under an
employer, or has actually worked for 190 days if employed under-ground, and
240 days in any other case in a period of 12 calender months preceding the date
relevant for making calculation. The days on which a worker has been laid off
under an agreement, or as permitted by standing orders, or the days on which he
has been on leave with wages, or the days on which he could not work due to
any employment injury, or the days on which a woman worker has been on
maternity leave not exceeding 12 weeks; are to be considered as the >days on
which a worker has actually worked.
The compensation is payable only for working days and not for weekly holidays
which may intervene. If the lay-off exceeds 45 days in any period of twelve months,
no compensation is payable for the days exceeding first 45 days if there is an
agreement between the employers and the workmen to that effect. In such a case it
will also be lawful for the employers to retrench workmen and set off lay-off
compensation paid to workmen against compensation payable to them for
retrenchment.
The laid off workmen is not entitled to lay-off compensation if:
a) he refuses to accept alternative employment in the same establishment or in any
other establishment belonging to the same employer located within five miles
from the establishment to which he belongs, and if his new place of employment
does not involve any loss of pay or position or any other special skill;
b) he does not present himself for work at the establishment and at the appointed
time during normal working hours every day; and
c) the lay-off if due to any strike or go-slow on the part of the workman in any part
of the establishment (Sec. 25B, 25C, 25D and 25E).
Explanation
If a question arises whether an establishment is of a seasonal character, or whether work
performed there is intermittent, the decision of the Government thereon is to be final.,
In the case of factories, mines and plantation establishments employing 100 or more
workers on average per working day in the preceding 12 months, no workman can be
laid-off by his employer except with the previous permission of Government, or the
authority specified by the Government, unless such lay-off is due to the shortage of
power or to natural calamity, and in the case of mines, such lay-off is due also to fire,
flood, excess of inflammable gas or explosion.
Permission is to be obtained by making an application for the same. In case of mines
an application will have to be made within 30 days from the date of commencement
of lay-off for obtaining permission for continuing the lay-off. The application for
permission shall state the reason for the intended lay-off, or the continuing the lay-off
in mines beyond one month. A copy of the application shall also be served' on the
workmen concerned in the prescribed manner.
After receiving the application, the government or the specified authority makes such
enquiries as it thinks fit, and after giving reasonable opportunity of being heard to the
employer, the workman concerned and the persons interested in such lay-off, may
having regard to the genuineness and adequacy of the reason for lay-off, interest of
the workman and all other relevant factors, grant or refuse such permission and a
26 copy of such order shall be communicated to the employer and the workman. If the
Government does not
communicate its decision on the application within sixty days from the date of Act, 1947-II
making such application by, the employer, the permission applied for shall be
deemed to have been granted on the expiration oaf sixty days. The Government order
granting or refusing permission shall be final and binding on all concerned, and shall
remain in force for one year from the date of such order. The government or the
specified authority may review its order either on its own motion or on the request of
the employer or employees, or refer the matter to a Tribunal for adjudication. If
referred to the tribunal, the latter will pass an award within thirty days from the date
of reference.
Lay-off shall be deemed to be illegal if no application is made for permission, or if
permission is refused and the workers shall be entitled to all benefits under any Law
for the time being in force as if they had not been laid-off. In exceptional
circumstances, such as accident in the establishment or death of an employer, or the
like, the government may waive the requirement of prior approvel for such period as
may be specified in the order.
Such an establishment have not to pay compensation even when lay-off due to strike
and go-slow on the part of workman in another part of the establishment 25(E). It
will not be allowed to retrench laid-off workman whose lay-off exeeds forty five
days, as is permissible in the case for establishment employing less than 100 workers
(Sec. 25 M)
15.6 RETRENCHMENT COMPENSATION
The definition of "Retrenchment" in Sec. 2(00) means termination by the employer,
of the service of a workman for any reason whatsoever (i.e. economy, technology,
rationalisation etc.) otherwise then punishment inflicted by way of disciplinary action
and those expressly excluded by definition.
In order to restrict the wider coverage given by the courts to the term retrenchment in
Sec. 2 (00), the section was amended adding sub-clause (bb) to Sec. 2(00) in 1984.
According this new amendment where the services of a workmen is terminated in
terms of letter of appointment it is saved by sub-clause (bb) of Sec.2 (00), unless the
act of such termination was misused or vitiated or such a term of appointment was a
colorable exercise of power. In normal cases no reinstatement or appointment can be
ordered.
(1) No workman who has been in continuous service of not less than one year
under an employer, or has actually worked for 190 days, if employed underground,
and 240 days in any other case, in a period of 12 calendar months preceding the date
relevant for making calculations, can be retrenched, unless
a) he has been given one month's notice in writing indicating the reasons for
retrenchment, or he has been paid one month's wages in lieu of notice;
b) he has been paid retrenchment compensation equivalent to 15 days average
wage for every completed year of continuous service or any part thereof in
excess of six months; and
c) notice is served in a prescribed manner to government or such authority as
notified by the government in the Official Gazette. (Sec. 25 F)
The consequences not following Sec. 25 F (a & b) would make the retrenchment
invalid and inoperative.
(2) In the case of factories, mines and plantation establishments, employing 100 or
more workman, a workman cannot be retrenched unless he is given three month's notice
in writing, or is paid three months' wages in lieu of such notice, and prior permission of
the Government is obtained for retrenchment to which the notice relates. ;
The employer has to apply for permission in the prescribed manner stating clearly the
reason for the intended retrenchment, and a copy of such application has to be served
simultaneously on the workman concerned in the prescribed manner. On receiving
the application the government makes such enquiry as it thinks fit, and gives a
reasonable opportunity of being heard to the employer, the workman concerned and
the persons interested in such retrenchment. After considering the genuineness and
adequacy of the reason stated by the employer, the interests of the workmen and all 27
other relevant factors,
the Government passes order with reasons to be recorded in writing granting or

refusing permission, and a copy of such order is communicated to the employer and
the workmen. If the employer does not receive any order of the Government on his.
application for permission for retrenchment within sixty days from the date the
application is made, the permission applied for shall be deemed to have been granted
on the expiry of sixty days.
The order passed by the Government or the specified authority granting or refusing
permission shall be final and binding on all concerned, and shall remain in force for
one year from the date of such order. The government either of its own or on the
application made by the employer or any workmen may review its order, or refer the
matter or cause it to be referred to a Tribunal for adjudication, and the Tribunal shall
pass an award within thirty days from the date of such reference.
Where no application for permission for retrenchment is made, or permission is
refused, such retrenchment will be illegal from the date on which notice of
retrenchment is given to the workman, and the workman will be entitled to all the
benefits under the law in force as if no notice had been given to them.
Under such exceptional circumstances as accident in the establishment, or death of
the employer, the appropriate government may waive of the requirement for a prior
permission of such period as may be mentioned in the order.
When permission for retrenchment has been granted or deemed to have been granted,
every worker who is employed immediately before the date of application for
permission, shall be entitled to receive at the time of-retrenchment compensation as
mentioned above (Sec. 25 N)
15.7 PROCEDURES FOR RETRENCE MENT

Ordinarily retrenchment is to be carried out on the principle of "last come first goes"
unless, for the reason to be recorded in writing, employer retrenches otherwise.
Re-employment of Retrenched' Workers: If vacancies arise after retrenchment,
opportunity is to be given to the retrenched Indian national to offer themselves for re-
employment, and they are to be given preference over others. The retrenched eligible
workers and their unions are to be informed of the vacancies by registered post, and
details of vacancies of more than one month duration are to be displayed at
conspicuous place in the undertaking at least ten days before the vacancies are to be
filled (Sec 25H and Rule 78)
15.8 COMPENSATION TO WORKMEN IN CASE OF

TRANSFER OF UNDERTAKINGS
If the ownership for management of an undertaking is transferred by agreement or by
law to a new employer, every workman who has been in continuous service for not
less than one year in that undertaking immediately before, such transfer, shall be
entitled to notice and compensation as if the :workman had been retrenched. But this
compensation is not payable if (i) the service of the workman has not been
interrupted by such transfer. (ii) the term and conditions of service applicable to the
workman after such transfer are not less favourable to him than <those applicable to
him before transfer; and (iii) the new employer is under the terms of such transfer, or
otherwise, legally liable to , pay to the workman, in the event of his retrenchment,
compensation on the basis that this service has been continuous. (Sec. 25 FF)
15.9 CLOSURE
When an undertaking is closed down for any reason, every workman becomes
entitled-to notice and compensation,, as if he has been retrenched, if he had
completed one year continuous service. If the closure is :due to circumstances beyond
the control for the employer, the total amount of compensation payable is not to
28 exceed average pay for
Industrial Employment
(Standing Orders) Act, 1946
UNIT 16 INDUSTRIAL EMPLOYMENT
(STANDING ORDERS) ACT, 1946
Objectives
After reading this unit, you should be able to:
• appreciate the need for the enactment of the Industrial Employment (Standing
Orders) Act, 1946
• develop an understanding about the nature and concept of Standing Order
• describe the procedure for certification of Standing Orders
• explain the procedure for modification of Standing Orders and operation of
Standing Orders
Structure
16.1 Introduction
16.2 Object
16.4 Concept and Nature of Standing Orders
16.5 Certification Process-its Operation and Binding Effect
16.6 Date of Operation of Standing Orders
16.7 Register of Standing Orders
16.8 Posting of Standing Orders
16.9 Duration and Modification of Standing Orders
16.10 Payment of Subsistence Allowance
16.11 Powers of Certifying Officers and Appellate Authority
16.12 Oral Evidence in Contradiction of Standing Orders not Admissible
16.13 Temporary Application of Model Standing Orders
16.14 Penalties and Procedure
16.15 Interpretation of Standing Orders
16.16 Power to Make Rules
16.17 The Schedule to the Act
16.18 Self-Assessment Test/Questions
16.19 Further Readings
16.1 INTRODUCTION
Before the passing of the Industrial Employment (Standing Orders) Act, 1946
conditions of employment obtaining in several industrial establishments were
governed by contracts between the employer and employees. Sometimes those
conditions were reduced in writing and in many cases they were not reduced to
writing, but were governed by, oral agreements. Inevitably in many cases conditions
of services were not well defined and thus articulate. There was thus complete
ambiguity in regard to their nature and scope.
The lack of rule for securing permanency of job, fair deal, disciplinary action on
petty matters was a worrying problem to industrial workers. Provision for effective
safeguards against unjust and wrong dismissal and other disciplinary actions became
a need of the time. Findings of the Enquiry Committees on labour problems and 35
investigations also
depicted the dire necessity of rule making in this regard. The Bombay Textile
Enquiry Committee, 1940 (volume-II: final report p. 355) has mentioned as follows:
"There is no fear which haunts an industrial worker more constantly than the
fen of losing his job as there is nothing which he prizes more than economic
security.
The fear of being summarily dismissed for even a slight breach of rules of
discipline or for interesting himself in trade union activity disturbs his mind.
It is a notorious fact that dismissals of workers have been the originating
causes of not a few industrial disputes and strikes. The provision of effective
safeguards against unjust and wrong dismissals is therefore, in the interest as
much of the industry as of the workers."
The Labour Investigation Committee, in its Report, at p. 113 (1946) had observed
and put forth the similar views in this regard as follows:
"An industrial worker has the right to know the terms and conditions under
which he is employed and the rules of discipline which he is expected to
follow. Broadly speaking, in Indian Industry the rules of service are not
definitely set out and like all unwritten laws, where they exist, they have
been very elastic to suit the convenience of employers. No doubt, several
large-scale industrial establishments have adopted standing orders and rules
to govern the day to day relations between the employers and workers, but
such standing orders or rules are clearly one sided. Neither workers
organisations nor Government are generally consulted before these orders are
drawn up and more often than not they have given the employers the upper
hand in respect of all disputable points."
It was to ameliorate these evils that the Industrial Employment (Standing Orders)
Act, 1946 was passed to require the employers in industrial establishment to define
with sufficient precision the conditions of employment under them and to make the
said conditions known to workmen employed by them. Before this Act, there was no
law to prevent the employer from having different contracts of employment with
workmen that led to confusion and discriminatory treatment. This was also clearly at
variance with the principle of collective bargaining.
16.2 OBJECT
The Act is designed to avoid friction and tension among employer and workmen
employed in an industry. The Tripartite Labour Conference pleaded for defining the
conditions of employment so as to create harmonious relations between employer and
workmen. Before this Act, victimisation and unfair labour practices were quite
frequent. The industrial worker had no right to know the terms and conditions and
rules of discipline of his employment. Except in some large scale industrial
establishment there were no standing orders and rules to govern the day to day
relations between employers and workers. Even in few cases where there were,
standing orders, they were one sided because neither workmen's organisation nor
appropriate Government were consulted before such rules were framed. [See I.L.I.
Labour Law and Relations: (1968) Part 7.]

i) Establishments Covered (Sec. 1(3)
The Act applies to every industrial establishment wherein one hundred or more
workmen are employed, or were employed on any day of preceding twelve months.
ii) Industrial Establishment
Section 2(e) defines "industrial establishment" to mean
(a) an industrial establishment as defined in clause (ii) of Section 2 of the
Payment, of Wages Act which defines "industrial establishment" to mean any:
36 i) tramway service or motor transport service engaged in carrying passenger,

goods or both by road for hire or reward.
ii) air transport service other than such service belonging to, or exclusively (Standing Orders) Act, 1946
employed in the Military, Naval or Air Forces of the Union or Civil
Aviation,umartment of the Government of India-
iii) Dock wharf or Jetty;
iv) inland vessel, mechanically propelled
v) mine, quarry or oil field;
vi) plantation;
vii) workshop or other establishment in which articles are produced adapted or
manufactured with a view to their use, to transport and sales;
viii) establishment in which any work relating to construction development or
maintenance of buildings, roads, bridges or canals, or relating to operations
connected with navigation, irrigation or the supply of water or relating to the
generation, transmission and distribution of electricity or any other form of
power is being carried on.
ix) Industrial and any other establishments as mentioned u/s 2(ii) of Payment of
Wages Act. 136., as defined in Clause (ii) of Section 2 of the Payment of Wages
Act, 1963;
or
a) a factory as defined in Clause (m) of Section 2 of the Factories Act, 1948 or;
b) a railway as defined in Clause (4) of Section 2 of the. Indian Railways Act 1890; or
c) the establishment of a person who, for the purpose of fulfilling a contract with
the owner of any industrial establishment, employs workmen.
iii) Establishment Excluded The Act is, not applicable to:
i) any industry to which the provisions of Chapter VII of the Bombay Industrial
Relations Act, 1946 apply; or
ii) any industrial establishment to which the provisions of the Madhya Pradesh
Industrial Employment (Standing Orders) Act apply: provided that
notwithstanding anything contained in the Madhya Pradesh Industrial
Employment (Standing orders) Act, 1961, the provision of this Act shall apply
to all industrial establishments under the control of the Central Government.
(Section 1(4).)
iv) Exempted Establishment
This Act shall not apply to an industrial establishment in so as far as the workmen
employed therein are persons to whom: the fundamental and supplementary rules,
civil services (classification, control and appeal) rules, civil services (temporary
service) rules, revised leave rules, civil service regulations, civilians in defence
services (classification, control and appeal) rules or the Indian Railways
Establishment Code or any other rules or regulation that may be notified in this
behalf by the appropriate Government in the Official Gazette, apply. (Section 13B).
v) Government's Power to Exempt
vi) Appropriate Government
The definition of appropriate Government under LE (S.O) Act, is some what
different from that in ID Act. The use of the words, `under the control of in IE (SO)
Act instead of the words: `under the authority of in ID Act has resulted in the Central
Government being the appropriate government under IE (SO) Act in respect of
establishments for which the appropriate government under the ID Act is the State
government concerned.
In ID Act, despite S.C. verdict under Air India Statutory Corporations case, the
appropriate government in respect of Central. PSUs, continues to be State
Government for administrative reasons. The confusion still persists, as far as the
Contract ]Labour (Regulation and Abolition) Act, 1970 is concerned.
The appropriate Government is also empowered to exempt conditionally or
unconditionally
37
(i) any industrial establishment, or (ii) class of establishments from all or any of the
provisions of the Act. This should be done by notification in the official Gazette.
vii) Workers Covered
Section 2(i) of the Industrial Employment (Standing Orders) Amendment Act, (Act
18 of 1982) provides that the "workman" has the meaning assigned to in it in
Clause(s) of Section 2 of the Industrial Disputes Act, 1974.
viii) Employer under the Act
Section 2(d) of the IE (SO) Act defines "employer" to mean:
The owner of an industrial establishment to which this Act for the time being applies,
and includes
i) in a factory, any person named under Clause (f) or sub-section (I) of Section 7,
of the Factories Act, 1948 (Act 63 of 1948) manager of the factory.
ii) in any industrial establishment under the control of any department of any
Government in India, the authority appointed by such Government in this
behalf, or where no authority is so appointed, the head of the department;
iii) in any other industrial establishment, any person responsible to the owner of the
supervision and control of the industrial establishment.
16.4 CONCEPT AND NATURE OF STANDING ORDERS

I. Concept of Standing Orders
a) Definition
Section (2) (g) of the Industrial Employment (Standing Orders) Act, 1946
(hereinafter referred to as IESOA) defines "standing order" to mean:
rules relating to matters set out in the Schedule
Thus, the items, which have to be covered by the standing orders in respect of which
the employer has to make a draft for submission to the certifying officer, are matters
specified in the schedule.
b) Contents of the Schedule
The matter referred to in the Schedule are:

1. Classification of workmen, e.g., whether permanent, temporary, apprentices,
probationers, of badlis.
2. Manner of intimating to workmen periods and hours of work, holidays, paydays
and wage rates.
3. Shift working.
4. Attendance and late coming.
5. Conditions of, procedure in applying for, and the authority which may grant,
leave and holidays.
6. Requirement to enter premises by certain gates, and liability to search.
7. Closing and re-opening of sections of the industrial establishment, and
temporary stoppages of work and the right and liabilities of the employer and
workmen Arising therefrom.
8. Termination of employment, and the notice thereof to be given by employer and
workmen.
9. Suspension or dismissal for misconduct, and act or omissions which constitute
misconduct.
10. Means of redress for workmen against unfair treatment or wrongful exactions by
38 the employer or his agents or servant.
11. Any other matter which may be prescribed.
II. Nature of the Standing Order (Standing Orders) Act, 1946
The Supreme Court in Bagalkot Cement Company Ltd. v. Pathan (K.K.). (1962) 1
L.L.J. 203)], held that certified standing orders, have statutory force and after they are
certified, constitute the statutory terms of employment between the industrial
establishment in question and their employees.
Again in Western Indian Match Co. v. Workmen, AIR 1964
S.C. 1458 the Supreme Court spoke in similar terms:
"The terms of employment specified in the Standing Order would prevail over
the corresponding terms in the contract of service in existence at the time of
the enforcement of the Standing Order."
16.5 CERTIFICATION PROCESS-ITS OPERATION A

BINDING EFFECT
1. Submission of Draft Standing Orders by Employers
Section 3 of the Industrial Employment (Standing Orders) Act (hereinafter referred to

IESOA) requires every employer of an "industrial establishment" to submit draft
standing orders, i.e., "rules relating to matters set out in the Schedule" proposed by
him for adoption in his industrial establishment. Such a draft should be submitted
within six months of the commencement of the Act to the Certifying Officer. Failure
to do so is punishable and is further made a continuing offence. [See U.P State
Electricity Board v. Hari Shankar, (1978) 4 SCC. 16.] The draft standing orders must
be accompanied by particulars of workmen employed in the, establishment as also
the name of the trade union, if any, to which they belong. Vrider sub-section 4, of
Section 3, if the industrial establishments, are of similar nature, the group of
employers owning those industrial establishments may submit a joint draft of
standing orders.
II. Conditions for Certification. of Standing Orders
Section 4 requires that standing orders shall be certified under the Act if:
a) provision is made therein for every matter set out in the Schedule which is
applicable to the industrial establishment; and
b) they are otherwise in conformity with the provisions of the Act; and
c) they are fair and reasonable.
Since the aforesaid conditions form the nucleus of a valid standing orders it is
necessary to examine them.
A. Matters to be set out in the Schedule
The draft standing orders should contain every matter set out in the schedule of the
Act with the additional matter prescribed by the Government (M.K.E. Association v.
Industrial Tribunal, AIR 1959 Mysore 235 as are applicable to the industrial
establishment. According to the Section 4 the standing orders shall be certifiable if
provision is made therein for every matter stated in the Schedule to the Act.
B. Matters not Covered by the Schedule
The Schedule, it has been seen earlier, contains Clauses 1 to 10 which deal with
several topics in respect of which standing orders have to made provision and Clause
11 refers to any other matter which may be prescribed. These items are not
exhaustive and do not contain items on several subjects.
C. Conformity with the Model Standing Orders
Where model, standing orders have been prescribed the draft submitted by the
employers must be in conformity with the model standing orders provided under 39
Section 15(2) (b)
"as far as it is practicable." [Section 3 (2); See also Associated Cement Co. v. P.D.
Vyas.AIR 1960 S.C. 665. Sexual Harrassment has been covered as a misconduct
recently.
D. Fairness and Reasonableness of Standing Order
Prior to 1956 the Certifying Officer had no power to go into the question of
reasonableness or fairness of the draft standing orders submitted to him by the
employers. His only function was to see that the draft must incorporate all matters
contained in the Schedule and that it was otherwise certifiable under the Act. [See
Shahadra-Saharanpur Light Railway Co. Ltd. v. S.S. Railway Workers Union,,
(1969) 1 L.L.J. 734, 740 (SC)]. Such a power was also not conferred upon the
Appellate Authority. However, this provision did not provide adequate safeguards
against unfair provisions, in the standing orders and, therefore, caused great hardship
upon workmen.
In 1956, the Parliament amended the Act and thereby not only considerably widened
the scope of the Act but also gave a clear expression to the change in legislative
policy. Section 4, as amended by Act 36 of 1956 imposes a duty upon the Certifying
Officer and appellate authority to adjudicate upon the fairness and reasonableness of
the standing orders. If they find that some provisions are unreasonable they must
refuse to certify the same. [See A.G. Mazdoor Sangh v. India Air Gases Ltd., (1977) 2
L.L.J. 503. (Allahabad)]. While adjudicating the fairness or reasonableness of any
standing order, the Certifying Officer should consider and weigh the social interest in
the claims of the employer and the social interest in the demand of the workmen.
[Western India Match Co. v. Workmen, AIR 1973 SC 2650, 2653.]
Thus the Parliament confers 'the right to individual workmen to contest the draft
standing orders submitted by the employer for certification on the ground that they
are either not fair or reasonable. Further, the workmen can also apply for their
modification despite the finality of the order of the appellate authority.
III. Procedure for Certification of Standing Orders
When the draft standing orders are submitted for certification, the Certifying Officer
shall send a copy of the draft to the trade union, if any, or in its absence to the
workmen concerned, to file objections, if any, in respect of the draft standing orders,
within fifteen days of the receipt of the notice. He is further required to provide
hearing opportunity to the trade union or workmen concerned as the case may be.
After hearing the parties he shall decide whether or not any modification of or
addition to the draft submitted by the employer is necessary to Tender the draft
certifiable under the Act and shall make an order in writing accordingly. For this
purpose he shall inquire (I) whether the said standing orders are in conformity with
the model standing orders issued by the Government; (ii) whether it provides for
every matter set out in the Schedule; and (iii) whether they are reasonable and fair.
He shall then certify the standing orders with or without modification as the case may
be. He shall send within seven days authenticated copies of standing orders to
employers and to the trade unions or other representative of workmen.
IV. Certifying Officers: Their Appointments, Powers and Duties
The Certifying Officers under the IESOA means as Labour Commissioner or a
Regional Labour Commissioner, and includes any other officer appointed by the
appropriate Government, by notification in the official Gazette, to perform all or any
of the functions of Certifying Officer under the Act. He is "the statutory
representative of the Society."
Section 11 (1) vests certifying officer and appellate authority with all the power of a
Civil Court for the purposes of. (i) 'receiving evidence; (ii) enforcing the attendance
of witnesses; and (iii) compelling the discovery and production of documents. He
shall also be deemed to be the `Civil Court" within the meaning of Sections 345 and
346 of the Code of Criminal Procedure, 1973.
V. Appeals Against Certification
40 Section 6 provides that any employer, trade union or other prescribed representatives,
aggrieved by the order of Certifying Officer made under Section 5 (2) may appeal to
the
UNIT 17 INDUSTRIAL DISCIPLINE AND

MISCONDUCT
Objectives
After reading this unit you should be able to:

• define and explain the concept of industrial discipline
• explain the meaning of misconduct
• identify the steps to be taken when exercising the power to take disciplinary
action against erring workman
Structure
17.1 Industrial Discipline
17.2 Misconduct
17.1 INDUSTRIAL DISCIPLINE

i) Meaning
Industrial discipline means working by employees according to rules, regulation and
code of conduct in the industry. Industrial discipline signifies orderliness. It is the
opposite to disorder in employees behaviors and action. It is said to be good when the
members of organisation willingly follow the rules and regulation within the
standards of acceptable behaviors and willingly follow the rules and regulations of
the enterprise. It is said to be bad when subordinates either do this reluctantly and
unwillingly or actually disobey regulations and standards of acceptable behaviour as
promulgated by the need of enterprises,
ii) Objectives of Industrial Discipline
The main objective of Industrial discipline is to:
i) get co-operation of subordinates within the framework of management's policy
for fulfilling the target and not merely to enforce authority;
ii) to reform the offender causing displeasure, deter others from making the same
mistake.
Right of the Employer to Enforce Discipline
The employer has a right to enforce discipline in his establishment. But rules of
discipline, while buttressed by legal forms of compulsion should proceed in most
cases not by coercion but through workers education and continuous persuasion;
effective and efficient discipline is that which is self-discipline rather than forced
discipline and its real meaning depends upon the quality and caliber of the cadre of
Managers. If a management has built up a reputation for its fairness, open mindness,
fairplay, objective approach and justice, its problem of discipline would be
comparatively less. In the event of the misconduct by the employee it should be
endeavour of the management to trace out the reasons and causes of in-discipline.
This is a question of self-realisation on the part of employer. It would be fair to
comment that paramount duty of management is to refrain its employees from
touching the burning flame (misconduct) and suffering burns (punishment). A great
behavioural scientist D.Mcgregor (Hot Stove Rule) has brought out five principles
for promoting self discipline viz. Advance warning, universality, consistency,
impersonality and immediacy meaning thereby rules of discipline be formulated and
be m e known to employees, rules must be same for all, there should be equal
treatment in al cases of in-discipline, the attitude behind punishment should be that
person is not punished but his in-discipline is punished, there should be no delay in
46 cognisence of a misconduct-and punishment thereupon. It is seen that above
principles are generally not adhered to by Managers in their letter and spirit as a
result of which wound of in-discipline is always raw.
Insutrial Discipline and
It was emphasised in the document of second Five Year Plan that "while the Misconduct
observance of stricter discipline, both on the part of the labour and management is a
matter which cannot be imposed by legislation, it has to be achieved by organisation of
employers and workers by evolving suitable sanctions on their own; some steps,
legislative or otherwise in case of rank in-discipline requires to be thought of
Thus the Government shifted the emphasis from legislation to voluntary arrangements.
It was in this context that the question of discipline in industry was discussed in the
Indian Labour Conferences and the "Code of Discipline"- the Code laying down the
rights and obligations on all sides - came to be formally announced in June, 1958. The
Code applied both to the public and private sector industrial organisations. The Code
enjoins on parties to refrain from taking unilateral action in connection with any
industrial matter, to utilise the existing machinery for settlement of disputes with
utmost expedition and to abjure strikes and lockout without notice and without
exploring all. avenues of settlement. It also discourages recourse to litigation and
recommends that disputes not mutually settled, should be resolved through arbitration.
The striking feature of the Code is that emphasis has been put on mutual agreements
rather than on compulsory arbitration or adjudication and to deal with the day to day
grievances of workers, which often lead to acts of in-discipline, through suitable
grievance procedure. But the Code achieved little success due to lack of legal
sanction behind it.
In such a situation the employers have always regarded the right of disciplinary
action as a concomitant to the efficient attainment of the objectives of their industrial
activities. "Every organisation must have discipline to achieve its objective,
employee discipline has been defined as orderly behaviour." [(Koontz and O Donnel,
principles of management: McGraw Hill Book Company 1955 p. 197.)] In the
absence of sound collective bargaining agencies of the workman, the employer's
prerogative of disciplinary action has gone to the extent of dispensing with the
service of employees for trifling acts of misconduct. Disciplinary action leading to
discharge/dismissal causes dissatisfaction among workers in a country where
employment opportunities are inadequate. It is therefore, desirable to formulate some
fundamental principles through which the disputes relating to disciplinary action may
be settled in the interest of harmonious labour management relations between labour
and management. Unfortunately, up till now there is no statutory provision which
may provide some guide lines to the employer to maintain discipline in the industry
as well as to deliver justice in case of disciplinary action, if any, against the industrial
workers. Though the Code of discipline had been formulated, yet it was neither
obligatory nor procedural.
17.2 MISCONDUCT
The concept of misconduct is a general concept and is not confined to labour-
management relations only. Misconduct is a specific word with specific connotation and
it is difficult to lay down any general rule in respect of this problem. Under the Indian
Penal Code and other special and local laws, some acts or omissions are offences for
which a person can be punished by the sovereign power of state. These offences or acts
are considered to be prejudicial to the interests of the society in general and, therefore,
they are prohibited by law. There ',re however, various other organisations such as
professional bodies, clubs and corporations, and anyone who wants to be a member of
such body, for availing of the advantages and facilities provided by such body, is also
required to act under certain rules and subject to certain discipline. If he does anything
in violation of rules or any act inconsistent with his position, he is liable to lose the
advantages and facilities of the association with that society or organisation. Any such
act is, therefore, generally called a "Misconduct". (B.R. Ghaiye, "Misconduct in
Employment", Eastern Book Company, 1982 P. 59).
The employment under a particular employer is also subject to certain rules and
certain discipline, and any act in violation of such rules or discipline will be a
misconduct. Thus in industrial law, misconduct is an act which makes the workman
committing such act liable for punishment. Workmen involved in misconduct have to
be punished: Otherwise the-work-o€-the-industrial-organisation-will be hampered.
Every organisation must necessarily maintain certain amount of discipline in order to 47
work successfully.
UNIT 18 DOMESTIC ENQUIRY

Objectives
After reading this unit, you will able to know:

• how to impart the principles of Natural Justice in practice
• the concept of domestic enquiry
• the concept of charge-sheet, suspension pending enquiry; different other aspects
of domestic enquiry and domestic enquiry proper
• awarding and communicating punishment
• in what circumstances Court intervenes
Structure
18.1 Concept of Domestic Enquiry
18.2 The Processes of Domestic Enquiry
18.2.1 Preliminary Enquiry
18.2.2 Framing of Charges
18.2.3 Services of Charge-sheet
18.2.4 Reply to the Charge-sheet
18.3 Choice of the Enquiry Officer
18.4 Notice of Enquiry and its Service
18.5 Choice of Prosecution and Presenting Officer
18.6 Assistance to the Delinquent Workers
18.7 Other Facilities
18.8 Enquiry Proper
18.9 Findings
18.10 Imposition of Punishment
18.11 Communication of the Order of Punishment
18.12 Intervention by Courts
18.1 CONCEPT OF DOMESTIC ENQUIRY

Domestic enquiry is analogous to trial in a court of law with difference that while
trial in the court is for crimes done against the State or Society, domestic enquiry is
conducted for offences against the establishment for misconduct punishable under the
Standing Orders/Companies' Rules and Regulations, etc., applicable to the
establishment where the worker is employed. Further, the trial in the court is in
accordance with the Criminal Procedure Code, while domestic enquiry is conducted
in terms of what is called `Natural Justice". Another difference is that the enquiry
officer while examining the evidence and pronouncing on. the guilt is not supposed to
award penalty which is left to a superior officer who is the employer or the
appointing authority. Still another difference is that a misconduct under the Standing
Orders/Companies' rules and regulations, etc., may or may not be a crime under the
Indian Penal Code.
Domestic enquiry is not a legal requirement under the Industrial Disputes Act or
other substantive laws such as the Factories Act, Mines Act, etc. but has been
provided under the standing orders to the framed under the Industrial Employment
(Standing Orders) Act. This Act is presently applicable only to large establishments
employing not less than 50 workmen and as such smaller establishments employing
less than 50 workers are not covered by this Act. However, the case law established
50 over a long period has made it obligatory for the employers to hold a fair and just
enquiry to prove the misconduct
Domestic Enquiry
alleged against the employee before awarding any serious punishment. Dismissal or
any major notice against an employee without holding a fair and just domestic
enquiry amounts to violation of principles of natural justice and is frowned upon by
the Labour Courts/Industrial Tribunals; so much so, dismissal without holding
regular enquiry is deemed an illegality. (Provincial Transport Services Vs. State
Industrial Court AIR 1963 SC 114 = 1962-2 LEJ = 360). Further, as the domestic
inquiry is usually conducted by an officer subordinate to or paid by the employer, the
workman looks upon it as an exercise, designed to tie the loose ends in the
allegations and tighten the noose around the worker's neck. For this reason he may
not take it seriously and may suffer in default.
Before any punishment for misconduct is awarded observance of principles of natural
justice in form of inquiry is a must. This principle is also known as principles of
justice equity and fairplay. There are two main ingredients of natural justice-
a) AUDI ALI'ERAM PAR 1'EM - Hear the other side
b) NEMO JUDEX IN CAUSUA - No person can be judge in his own cause - there
should not be bias - personal or any other
The aim is to prevent miscarriage of justice.
18.2 THE PROCESSES OF DOMESTIC ENQUIRY

While none of the Statues has laid down any precise procedure for holding a
domestic enquiry yet several important stages of the process of domestic enquiry can
be enumerated:
18.2.1 Preliminary Enquiry
After a report about the misconduct committed by the delinquent\workman is
received by the employer, he is required to decide whether a prima facie case exists
for a formal enquiry. For this purpose, he may hold a preliminary enquiry of an
informal nature. Such an enquiry is purely informal and does not call for the
observance of any specific rules of natural justice and can be held ex-parte i.e. the
workman need not be questioned or otherwise asked to take part in it. Statements
taken in the preliminary enquiry cannot be used as evidence in the formal inquiry. In
fact the preliminary enquiry is intended only for the disciplinary authority to satisfy
himself whether departmental action is called for or not. Hence, there may not be any
formal report about the preliminary enquiry and no reference is to be made to it in the
subsequent enquiry.
18.2.2 Framing of Charges
This is easily the most important and perhaps, the most crucial stage in the entire
proceedings, because the success of any disciplinary case depends primarily on the
soundness of the charges. The charges are, in turn, based on imputations so that if the
imputations or allegations are based on solid evidence, the chances of successful
conclusion of the domestic enquiry are gratefully enhanced. Unfortunately, gathering
of fool proof evidence requires extreme care, patient and laborious work needing lot
of time which is very often grudged. There is little realisation that hurriedly drawn up
changes based on insufficiently gathered information enable the worker to wriggle
out of the noose and escape punishment. As such, time spent in the informal enquiry
in building up a sound basis for the charges is time well spent. Charges should be
specific and precise based upon the statement of allegations and ought to be related to
the misconducts specified under the service rules or the certified standing orders
applicable to the establishment. The following considerations may be kept in mind
while framing the charges.
i) Are the charges definite and clear?
ii) Is there a splitting up of a single offence into multiple charges?
iii) Is there a merger of distinct offences in one charge?
51
iv) Are the charges logically framed? Do they flow logically from the nature of the
allegations made?
The chargesheet should contain the following, in clear, simple and cogent language.
i) The alleged facts and circumstances (with date, time, place and words, if
relevant) in specific terms with surrounding accentuating factors (if any alleged),
which if proved would constitute "misconduct".
ii) Previous record (punishment including) if relevant to the facts and
circumstances alleged or if they aggravate or accentuate the charge or if the
same is going to be considered by punishing authority at the time of considering
punishment (previous record for period beyond certain time becomes
meaningless if there is specific provision in standing orders or in the
circumstances of the case).
iii) Charges levelled against in specific terms (to be quoted from the Standing
Orders, if applicable, otherwise in language borrowed from industrial law), of
which the chargesheeted workman would be guilty, if the facts and
circumstances alleged against him be proved.
iv) Proposed punishment that may ensure if guilt be established.
v) Request/direction advice to submit explanation (with specification of reasonable
time-for the purpose the specified time will commence only from the time the
chargesheet is received by workmen) to the facts and circumstances alleged and
the charges levelled against and also to show cause as to why the punishment
indicated above should not be inflicted if charge be proved. (In industrial
employment only single and combined show cause notice is given (cause against
charges and also against proposed punishment). In public employment, second
show cause notice against punishment is issued after the guilt is proved).
vi) Order of suspension (if any and if not done already) - if considered necessary
and justified with date from which it will be effective and making clear the
purpose of such suspension pending enquiry - not as Ia substantive punishment -
(like security measure). In some extreme cases of misconduct, suspension order
is issued immediately pending issue of formal chargesheet; but there also the
cause of suspension is required to be given in clear terms.
Suspension after some efflux of time after issue of chargesheet or on failure to submit
explanation is not warranted or justified and will smack of vindictiveness on the part
of management.
If `misconduct' alleged pertains to some record - it is advisable to enclose with
chargesheet the true certified extract from such record. T1ie idea is that a workman to
be proceeded against must know exactly what allegation and what charges he is
required to meet, (doctrine of reasonable opportunity).
It is worth remembering that before' issue of chargesheet the management must have
in its possession the main documents (materials) on which it is basing its
accusations/charges. Chargesheet based on verbal, reports, hearsay reports etc., are
required to be scrupulously avoided.
Some companies have printed stereotyped form of chargesheet. Care should be taken
that such hide bound; forms do not dehumanise a chargesheet.
There is to be still found a practice of providing space in the chargesheet itself for the
workman to give explanation. This is considered not a good practice, since after the
explanation, he-will have no copy of chargesheet with him, for preparing his defense.
It has been also seen that some chargesheets contain advice regarding date, time and
place of enquiry This is considered preposterous, as it would show that management
did not consider it, necessary to wait for the explanation.
18.2.3 -Services of Charge-sheen
Once chargesheet is prepared, it is required to be served on the workman concerned
and proof of its service obtained. If the workman is present, service may be affected
by personal service, obtaining acknowledgment of its receipt either on a copy of the
chargesheet or in a dak book or on a separate piece of paper. At the time of service of
chargesheet it is advisable (necessary) to have at least two witnesses, so that in case
52 of refusal to accept chargesheet, the fact is recorded by the person serving the
chargesheet
Domestic Enquiry
and signature of witnesses obtained. In some companies (and under certain Standing
Orders) there is a good system of reading over and explaining the contents of the
chargesheets in the language understood by the workman concerned, in presence of
witnesses. In fact these endorsements are printed on the copies of chargesheet. In
case of illiterate or semi-illiterate workman, this practice is warranted and should be
encouraged.
If the workman is absent or if he has refused to accept the chargesheet, the
chargesheet (along with an endorsement to that effect about its earlier refusal and if
necessary with a further chargesheet for `refusal. to accept Company's
communication') is required to be sent to the workman's last known address, by
Registered post with A.D. (It is a good idea to send one copy by ordinary post under
certificate of posting, as well).
(Sending by Registered Post would mean `delay' but it cannot be helped. The time
given for explanation will commence from the time of receipt of chargesheet).
If the registered communication comes back with remarks `refused' and if the
standing orders so provide, it may be deemed that chargesheet have been duly served.
But if there be no such provision or registered letter comes a back with remarks like
`
not known', ,not in town' etc., it is necessary to publish the `full chargesheet' in two
news papers (in a regional language) with wide circulation in the area where the
workman concerned works.
If the industrial relations in a company are good and if there is cooperation between
the management and the union in matters of discipline, several problems of service of
chargesheet (and also subsequent proceedings) may not arise.
There are practical problems like Regd. A.D. slip not coming back (this means no
proof for service of chargesheet though Registration receipt is proof of its H 'i~g
sent), the incorrect/incomplete address of the employee on the envelope etc., have
'
got to be tackled with tact and patience.
18.2.4 Reply to the Charge-sheet
After the chargesheet is received by the workman he may:
i) ask for further details or for inspection of documents referred to in chargesheet
ii) accept the accusations, plead guilty of the -charges and tender apologies
iii) may ask for time to submit explanation
iv) may explain away the accusation and deny the charges
v) may not submit any explanation
1. It is advisable to give details if any asked for by employee and also allow him to
inspect documents if any relevant to the charge. For such inspection, he may be
allowed to bring a co-workman (or a union representative) Correspondence in
regard to chargesheet is better avoided).
2. If he pleads guilty, in writing, confirmation of such pleading should be obtained
in writing in presence of two witnesses lest the charge of coercion/intimidation
is brought against the management. Then further steps are not called for; the
management may proceed to award appropriate punishment.
3. Extension of time for explanation, if prayed for, should be given at. least once.
as a. measure of abundant caution, depending upon the ground on which such
prayer is made.. Extension of time should be given in writing.
4. The explanation given should be properly considered and if the same is found
satisfactory, management should promptly withdraw the chargesheet in writing.
(Charges should be set aside honorably). If, however, explanation is not
satisfactory, next step is called for.
5. If explanation is not submitted either a further opportunity suo moto, may be
given or enquiry notice may be issued, with advice for submitting explanation if
any, before the commencement of the enquiry. Not giving an explanation does
not mean that workman "accepts the guilt". _It may be that either he has no
explanation to give or does not wish to give. In either case, the management is 53
required to proceed
further, as because it is management which has to prove the charges. It is not for the
workman to prove his innocence.
18.3 CHOICE OF THE ENQUIRE OFFICER

If an enquiry is decided upon, selection of enquiry ' officer should be first done, so
that doctrine of bias is not violated. Following persons should not be chosen as
enquiry officer.
i) One who will be a witness in the ensuing enquiry.
ii) One who himself is a punishing authority (though in exceptional circumstances,
it may be done, but better it is avoided).
iii) One who is not related to the complainant.
iv) One who is known to be/can be presumed to be possessing bias towards the
charge sheeted workman.
v) One who has personal knowledge of the facts and circumstances alleged in the
chargesheet.
vi) One who has issued chargesheet.
If none within the organisation is available for the enquiry, an outsider (even a lawyer
or professional consultant on payment) may be appointed as an enquiry officer.
18.4 NOTICE OF ENQUIRE' AND ITS SERVICE

After the enquiry officer is chosen, it is for the punishing authority or the officer
authorised (and not for the enquiry officer) to issue the enquiry notice with following
particulars:
1. fact of explanation (whether in part or full) having not been found satisfactory.
2. date, time and place of enquiry (should be on working days), during working
hours and preferably at the work place itself. (In extreme cases place of enquiry
may be other than work place, in which case, chargesheeted workman and the
co-workman and his witnesses should have to be paid appropriate conveyance
expenses). It should be noted that the workman proceeded against should get at
least 2/3 clear days notice for enquiry.
3. name of the Enquiry Officer - so that workman is given a chance to object to his
choice, on the ground of bias. Such objection if any made, should be considered
by the officer, who appointed the enquiry officer and unless objection is
frivolous or vexatious, the enquiry officer should be changed. It is always better
to change the Enquiry Officer, if the worker objects to him in any way or if the
worker expresses a fear that he may not get justice at the hand of the enquiry
officer chosen.
4. assurance that the chargesheeted workman would be given full opportunity to
defend himself, by cross-examining witnesses deposing against him and
producing witnesses in defence. (It is better to explain, at least in brief, the
fundamentals of procedure of such enquiry. This is advisable because once he is
informed of the procedure, he may not question or challenge it subsequently).
5. assurance that he would be allowed to bring a co-workman .of his choice in the
enquiry, to help him in conducting his defence. (Some Standing Orders also
permit bringing Office-bearer of a recognised union. Some allow representative
of even unrecognised union. Some allow such union's representative to act only
as silent observer without power to defend the worker. Present law permit
employer to object to any outsider (even a lawyer) being brought by the
chargesheeted workman.
6. assurance to help him to produce any document in the possession of
management, which he may desire to be produced in his defence:
54
7. assurance to permit employees under Company's control to depose as defence witness

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The Trade Unions

After going through this unit you should be able to understand:

13.2 SCOPE AND COVERAGE

UNIT 14 THE INDUSTRIAL DISPUTES

After going through this unit, you will be able to understand:

14.2 THE PRINCIPAL OBJECTIVES OF THE ACT

After studying this unit, you will be able to understand:

• The implications of notice of change

15.2 NOTICE OF CHANGE IN EMPLOYMENT

15.3 PROTECTION OF WORKMEN DURING PENDENCY

15.5 LAY-OFF COMPENSATION

the Government passes order with reasons to be recorded in writing granting or

15.7 PROCEDURES FOR RETRENCE MENT

15.8 COMPENSATION TO WORKMEN IN CASE OF

After reading this unit, you should be able to:

16.3 SCOPE AND COVERAGE

36 i) tramway service or motor transport service engaged in carrying passenger,

viii) Employer under the Act

Section 2(d) of the IE (SO) Act defines "employer" to mean:

16.4 CONCEPT AND NATURE OF STANDING ORDERS

rules relating to matters set out in the Schedule

b) Contents of the Schedule

The matter referred to in the Schedule are:

16.5 CERTIFICATION PROCESS-ITS OPERATION A

Section 3 of the Industrial Employment (Standing Orders) Act (hereinafter referred to

II. Conditions for Certification. of Standing Orders

UNIT 17 INDUSTRIAL DISCIPLINE AND

After reading this unit you should be able to:

17.1 INDUSTRIAL DISCIPLINE

UNIT 18 DOMESTIC ENQUIRY

After reading this unit, you will able to know:

18.1 CONCEPT OF DOMESTIC ENQUIRY

18.2 THE PROCESSES OF DOMESTIC ENQUIRY

18.3 CHOICE OF THE ENQUIRE OFFICER

18.4 NOTICE OF ENQUIRE' AND ITS SERVICE

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