Employee State Insurance Act, [ESI] 1948

OBJECT OF THE ACT: The Employees* Slate Insurance Act (ESI Act) was enacted with the object of
introducing a scheme of health insurance for industrial workers. The scheme envisaged by it is one
of compulsory State Insurance providing for certain benefits in the event of sickness, maternity and
employment injury to workmen employed in or in connection with the work in factories other than
seasonal factories. The ESI Act, which has replaced the Workmen's Compensation.

ESTABLISHMENT OF EMPLOYEES’ STATE INSURANCE CORPORATION.

[Section 3]

central government establishes the Corporation to be known as the Employees'

State Insurance Corporation. This corporation will be having following
characteristics

 separate corporate body.

 Having perpetual succession. (no death)
 Have a common seal.
 Employees' State Insurance Corporation can sue. (file a suit in court on other)
 Other can sue Employees' State Insurance Corporation.

THE CORPORATION SHALL CONSIST OF THE FOLLOWING MEMBERS.

[Section 4]

(a) Chairman, Vice-Chairman to be appointed by the Central Government;

(b) not more than 5 persons to be appointed by the Central Government;

(c) one person each representing each of the States in which this Act is in force to be
appointed by the State Government concerned;

(d) one person to be appointed by the Central Government to represent the 3Union
Territories;

(e) 10 persons representing employers to be appointed by the Central Government

in consultation with such organisations of employers.

(f) 10 persons representing employees to be appointed by the Central Government

in consultation with such organisations of employees.

(g) 2 persons representing the medical profession to be appointed by the Central

Government in consultation with such organisation of medical practitioners.

(h) 3 members of Parliament of whom two shall be members of the House of the
People (Lok Sabha) and one shall be a member of the Council of States (Rajya
Sabha) elected respectively by the members of the House of the People and the
members of the Council of States; and
(i) The Director-General of the Corporation ex-officio.

TERM OF OFFICE OF MEMBERS OF THE CORPORATION. [Section 5]

Members referred to in clauses (f), (g), (h) shall be four years, commencing from the
date on which their appointment or election. The members of the Corporation
referred to in clauses (a),(b),(c) and (e)of Sectiontion 4 shall hold office during the
pleasure of the government appointing them.

CONSTITUTION OF STANDING COMMITTEE. [Section 8]

Standing Committee of the Corporation shall be constituted from among its

members, consisting of

(a) A Chairman, appointed by the Central Government;

(b) three members of the Corporation appointed by the Central Government;

(bb) three members of the Corporation representing such three State Governments
thereon as the Central Government may, by notification Gazette, specify from time to
time;

(c) eight members elected by the Corporation as follows-

(ii) 3 members from among the members of the Corporation representing

employers;
(iii) 3 members from among the members of the Corporation representing
employees;
(iv) 1 member from among the members of the Corporation representing the medical
profession; and
(v) 1 member from among the members of the Corporation elected by Parliament;

(d) the Director General of the Corporation, ex officio

TERM OF OFFICE OF MEMBERS OF STANDING COMMITTEE. [Section 9]

 a member of the Standing Committee shall cease to hold office when he

ceases to be a member of the Corporation.

 the term of office of a member of the Standing Committee, other than a

member referred to in clause (a) or clause (b) or clause (bb) of Section 8,
shall be two years from the date on which his election.
  A member of the Standing Committee referred to in clause (a) or clause (b) or
clause (bb) of Section 8 shall hold office during the pleasure of the Central
Government.

MEDICAL BENEFIT COUNCIL. [Section 10](2010 AMENDMENT)

(a) the Director General, the Employees' State Insurance Corporation, ex officio as
Chairman;

(b) The Director General, Health Services, ex officio as Co-chairman;".

(c) one member each representing each of the States

(d) 3 members representing employers to be appointed by the Central Government

in consultation with such organisations of employers.

(e) 3 members representing employees to be appointed by the Central Government

in consultation with such organisations of employees.

(f) 3 members, of whom not less than one shall be a woman, representing the
medical profession, to be appointed by the Central Government.

DUTIES OF MEDICAL BENEFIT COUNCIL. [Section 22]

 advise the Corporation and the Standing Committee on matters relating to the
administration of medical benefit, the certification for purposes of the grant of
benefits and other connected matters;

 have such powers and duties of investigation as may be prescribed in relation

to complaints against medical practitioners in connection with medical
treatment and attendance; and

 perform such other duties in connection with medical treatment and

attendance.

CONTRIBUTIONS

ALL EMPLOYEES TO BE INSURED. [Section 38]

Factory or establishment having more than 10 employees should be insured under

the Employee State Insurance Act
CONTRIBUTION. [Section 39]

 Employer and employer liable for payment of the contribution to the Employee
State Insurance Corporation.

 The rate of contribution paid by employer and employee will be decided by the
central government.

 Currently, the employee’s contribution rate (w.e.f. 1.1.97) is 1.75% of the

wages and that of employer’s is 4.75% of the wages paid/payable in respect
of the employees in every wage period.

 If wage is received every month by employee, the Contribution to the ESI

Corporation should be made by employer and employee every month without
fail.

 @ 12% of interest per year should be paid If employer delays in payment of

the contribution to ESI corporation

PRINCIPAL EMPLOYER TO PAY CONTRIBUTIONS IN THE FIRST INSTANCE.

[Section 40]

 Employer should pay the contribution to ESI Corporation of behalf of his

employee.
 Employer may deduct employee contribution from employee wage for
payment of contribution to ESI Corporation.
 Employer may recover the employee contribution paid from the wage of the
employee which should not exceed the amount equivalent to employer
contribution.
 Employer will become responsible for the payment to the ESI contribution
after deduction of the employee contribution from the employee wage
 Employer should bear the expenses occurred in payment of contributions to
the Corporation.

GENERAL PROVISIONS AS TO PAYMENT OF CONTRIBUTIONS. [Section 42]

 No employee's contribution shall be payable by or on behalf of an employee

whose average daily wages during a wage period are below such wages as
may be prescribed by the Central Government.
 The average daily wages of an employee shall be calculated in such manner
as may be prescribed by the Central Government.

For Andhra Pradesh Employees in receipt of a daily average wage up to Rs.70/- are
exempted from payment of contribution.
METHOD OF PAYMENT OF CONTRIBUTION. [Section 43]

The ESI Corporation can make following rules and regulation in payment and
collection of contributions payable under this Act.

 The manner of payment of contribution

 The time of payment of contribution.
 Fixation of stamps for payment of contribution.
 Benefits distributed in the case of the insured persons by the corporation.
 Maintenance of books and cards of contribution of insured person by ESI
Corporation.
 The issue, sale, custody, production, inspection and delivery of books or
cards and the replacement of books or cards which have been lost, destroyed
or defaced.

EMPLOYERS TO FURNISH RETURNS AND MAINTAIN REGISTERS IN CERTAIN

CASES. [Section 44]

Every principal and immediate employer should submit to the Corporation or to such
officer of the Corporation as it may direct such returns in such form and containing
such particulars relating to persons employed by him.

Every principal and immediate employer shall maintain such registers or records in
respect of his factory or establishment

SOCIAL SECURITY OFFICERS, THEIR FUNCTIONS AND DUTIES. [SECTION 45]

(2010 amendment)

The Corporation may appoint such person as Social Security Officers, as it thinks fit,
for the purposes of this Act. The following are his functions and duties.

 Enquiring into the correctness of any of the particulars stated in any return
referred to in Section 44.
 Social Security Officers can demand any principal or immediate employer to
furnish to him such information as he may consider necessary for the
purposes of this Act.
 Social Security Officers can at any reasonable time enter any office,
establishment, factory or other premises for inspection of examine such
accounts, books and other documents relating to the employment of persons
and payment of wages or to furnish to him such information as he may
consider necessary.
  He can examine the employer, his agent or servant or any person found in
such factory, establishment, and office.
 He can make copies of, or take extracts from, any register, account book or
other document maintained in such factory, establishment, office or other
premises.
 He can do re-inspection whether the records and returns submitted under
Section 44 are correct or not.

[Section 45A] (2010 amendment)

If no records or particular of employed persons are not maintain as required under

this act by the his employer, social Security officer by order, determine the amount of
contributions payable in respect of the employees of that factory or establishment.
No order shall be passed by the Corporation in respect of the period beyond 5 years
from the date on which the contribution shall become payable.

CHAPTER V

BENEFITS

The following benefits will be paid to insured persons or to their dependents [Section
46]

 Periodical payments to any insured person in case of his sickness certified by

a duly appointed medical practitioner.
 Periodical payments to an insured woman in case of confinement or
miscarriage or sickness arising out of pregnancy, confinement, premature
birth of child or miscarriage, such woman being certified to be eligible for such
payments.
 periodical payments to an insured person suffering from disablement as a
result of an employment injury
 periodical payments to such dependants of an insured person who dies as a
result of an employment injury
 medical benefits

FUNERAL BENEFIT. [Section 46]

As prescribed by the central government,

an amount of Rs. 5000/- is payable to the dependents or to the person who performs
last rites from day one of entering insurable employment.

SICKNESS BENEFIT. [Section 49]

As prescribed by the central government,

Sickness Benefit represents periodical cash payments made to an IP during the

period of certified sickness occurring in a benefit period when IP requires medical
treatment and attendance with abstention from work on medical grounds. Sickness
benefit is roughly 60% of the average daily wages and is payable for 91 days during
2 consecutive benefit periods.

Qualifying Conditions

 To become eligible to Sickness Benefit, an Insured Person should have paid

contribution for not less than 78 days during the corresponding contribution
period.

 A person who has entered into insurable employment for the first time has to
wait for nearly 9 months before becoming eligible to sickness benefit, because
his corresponding benefit period starts only after that interval.

Extended Sickness Benefit (ESB)

IPs suffering from long term diseases was experiencing great hardship on expiry of
91 days Sickness benefit. Often they, though not fit for duty, pressed for a Final
certificate. Hence, a provision for paying Sickness Benefit for an extended period
(Extended Sickness Benefit)of up to 2 years in a ESB period of 3 years.

An Insured Person suffering from certain long term diseases is entitled to ESB, only
after exhausting Sickness Benefit to which he may be eligible. A common list of
these long term diseases for which ESB is payable, is reviewed by the Corporation
from time to time. The list was last reviewed on 5.12.99 and revised provisions of
ESB became effective from 1.1.2000 and at present this list includes 34 diseases
which are grouped in 11 groups as per International Classification of diseases and
the names of many existing diseases have been changed as under :-

I Infectious Diseases
1. Tuberculosis
2. Leprosy
3. Chronic Empyema
4. AIDS

II Neoplasms
5. Malignant Diseases

III Endocrine, Nutritional and Metabolic Disorders

6. Diabetes Mellitus-with proliferative retinopathy/diabetic foot/nephropathy.

IV Disorders of Nervous System

7. Monoplegia
8. Hemiplegia
9. Paraplegia
10. Hemiparesis
11. Intracranial Space Occupying Lesion
12. Spinal Cord Compression
13. Parkinson’s disease
14. Myasthenia Gravis/Neuromuscular Dystrophies

V Disease of Eye
15. Immature Cataract with vision 6/60 or less
16. Detachment of Retina
17. Glaucoma

VI Diseases of Cardiovascular System

18. Coronary Artery Disease:-
a. Unstable Angina
b. Myocardial infraction with ejection less than 45%
19. Congestive Heart Failure- Left , Right
20. Cardiac Valvular Diseases with failure/complications
21. Cardiomyopathies
22. Heart disease with surgical intervention alongwith complications

VII Chest Diseases

23. Bronchiectasis
24. Interstitial Lung Disease
25. Chronic Obstructive Lung Diseases (COPD) with congestive heart failure (Cor
Pulmonale)

VIII Diseases of the Digestive System

26. Cirrhosis of liver with ascities/chronic active hepatitis

IX Orthopaedic Diseases
27. Dislocation of vertebra/prolapse of intervertebral disc
28. Non union or delayed union of fracture
29. Post Traumatic Surgical amputation of lower extremity
30. Compound fracture with chronic osteomyelitis

X Psychoses
31. Sub-group under this head are listed for clarification
a. Schizophrenia
b. Endogenous depression
c. Manic Depressive Psychosis (MDP)
d. Dementia

XI Others
32. More than 20% burns with infection/complication
33. Chronic Renal Failure
34. Reynaud’s disease/Burger’s disease.

In addition to the above list, Director General/Medical Commissioner are authorised

to sanction ESB for a maximum period up to 730 in cases of rare but treatable
diseases or under special circumstances, such as, adverse reaction to drugs which
have not been included in the above list, depending on the merits of each case, on
the recommendations of RDMC/AMO or either authorised officers running the
medical scheme.

To be entitled to the Extended Sickness Benefit an Insured Persons should have

been in continuous employment for 2 years or more at the beginning of a spell of
sickness in which the disease is diagnosed and should also satisfy other contributory
conditions.

According to Section 69, employer shall be liable for payment of excess sickness
benefit, if the sickness to the insured person/ employee is caused by the negligence
and improper maintenance & no cleanliness of factory or establishment.

50. MATERNITY BENEFIT.

As prescribed by the central government,

Maternity Benefit is payable to an Insured Woman in the following cases subject to
contributory conditions:-

 Confinement-payable for a period of 12 weeks (84 days)

 Miscarriage or Medical Termination of Pregnancy (MTP)-payable for 6 weeks
(42 days) from the date following miscarriage.
 Sickness arising out of Pregnancy, Confinement, Premature birth-payable for
a period not exceeding one month.
 In the event of the death of the Insured Woman during confinement leaving
behind a child, Maternity Benefit is payable to her nominee
 Maternity benefit rate is double the Standard Benefit Rate, or roughly equal to
the average daily wage..

51. DISABLEMENT BENEFIT.

As prescribed by the central government

 Temporary disablement benefit (TDB)

Eligibility for TDB:

 The benefit is not subject to any contributory conditions. An Insured Person is

eligible from the day he joins the insurable employment.
 TDB Rate is 40% over and above the normal sickness benefit rate. This works
out to nearly 85% of the average daily wages.

Duration of TDB:

There is no prescribed limit for the duration of TDB. This is payable as long as
temporary disablement lasts and significant improvement by treatment is possible. If
a Temporary Disablement spell lasts for less than 3 days (excluding day of accident),
IP will be paid sickness benefit, if otherwise eligible.
Permanent Disablement Benefit (PDB)

PDB is payable to an Insured Person who suffers permanent residual disablement

as a result of EI (including Occupational Diseases) and results in loss of earning
capacity. The PDB rate is calculated as percentage of loss of earning capacity as
assessed by the Medical Board.

Employer will be liable for the accidents caused to his employer in the following
circumstance

 Accident caused to an employee even if he obeyed the safety instruction of

his employer [Section 51B]

 Accident caused to employee while travelling in employer’s transportation

vehicles. [Section 51C]

 At the time of employment the accident caused to the employee while

protection or rescuing other employer from occurring accident. [Section 51D]

 An accident occurring to an employee while commuting from his residence to

the place of employment for duty or from the place of employment to his
residence after performing duty, shall be deemed to have arisen out of and in
the course of employment. [Section 51E] (2010 amendment)

DEPENDANTS' BENEFIT. [Section 52]

As prescribed by the central government,

the dependants’ benefit is payable to the dependants in cases where an Insured

Person dies as result of Employment Injury. The minimum rate of dependants’
benefit w.e.f 1.1.90 is Rs.14/- per day and these rates of the dependants’ benefit are
increased from time to time. The latest enhancement is with effect from 01.08.2002

MEDICAL BENEFIT. [Section 56]

As prescribed by the central government,

Employer or his family members are entitled to the medical benefit. In case of the
retirement of the employer his spouse shall be eligible to receive medical benefit
subject to payment of contribution. In case of permanent disablement by the
employee, he can get medical benefit till the date of his retirement. Maximum age for
the retirement is 60 years.

Benefit not assignable or attachable. [Section 60]

 The right to receive any payment of any benefit under this Act shall not be
transferable or assignable.
  No cash benefit payable under this Act shall be liable to attachment or sale in
execution of any decree or order of any Court.

[Section 59B]

The Corporation can establish medical colleges, nursing colleges and training
institutes for its Para-medical staff and other employees with a view to improve the
quality of services provided under the Employees' State Insurance Scheme.

RECIPIENTS OF SICKNESS OR DISABLEMENT BENEFIT TO OBSERVE

CONDITIONS. [Section 64]

A person who is in receipt of sickness benefit or disablement benefit (other than

benefit granted on permanent disablement)-

 should remain under medical treatment at a dispensary, hospital, clinic or

other institution provided under this Act and shall carry out the instructions
given by the medical officer or medical attendant in charge thereof;

 should not while under treatment do anything and have chances of recovery;

 shall not leave the area in which medical treatment provided by this Act is
being given, without the permission of the medical officer, medical attendant
or such other authority as may be specified in this behalf by the regulations;
and

 Should allow himself to be examined by any duly appointed medical officer or

other person authorized by the Corporation in this behalf.

BENEFITS NOT TO BE COMBINED. [Section 65]

(1) An insured person shall not be entitled to receive for the same period-

(a) both sickness benefit and maternity benefit;

(b) both sickness benefit and disablement benefit for temporary disablement; or

(c) both maternity benefit and disablement benefit for temporary disablement.

(2) Where a person is entitled to more than one of the benefits mentioned in sub-
Section (1), he shall be entitled to choose which benefit he shall receive.

EMPLOYER NOT TO DISMISS OR PUNISH EMPLOYEE DURING PERIOD OF

SICKNESS, ETC. [Section 73]
No employer shall dismiss, discharge, or reduce or otherwise punish an employee during
the following circumstances

 sickness
 maternity leave
 pregnancy or confinement
 under the treatment in the hospital
 temporary disablement

CONTRIBUTIONS

ALL EMPLOYEES TO BE INSURED. [Section 38]

Factory or establishment having more than 10 employees should be insured under

the Employee State Insurance Act

CONTRIBUTION. [Section 39]

 Employer and employer liable for payment of the contribution to the Employee
State Insurance Corporation.

 The rate of contribution paid by employer and employee will be decided by the
central government.

 Currently, the employee’s contribution rate (w.e.f. 1.1.97) is 1.75% of the

wages and that of employer’s is 4.75% of the wages paid/payable in respect
of the employees in every wage period.

 If wage is received every month by employee, the Contribution to the ESI

Corporation should be made by employer and employee every month without
fail.

 @ 12% of interest per year should be paid If employer delays in payment of

the contribution to ESI corporation

PRINCIPAL EMPLOYER TO PAY CONTRIBUTIONS IN THE FIRST INSTANCE.

[Section 40]

 Employer should pay the contribution to ESI Corporation of behalf of his

employee.
 Employer may deduct employee contribution from employee wage for
payment of contribution to ESI Corporation.
  Employer may recover the employee contribution paid from the wage of the
employee which should not exceed the amount equivalent to employer
contribution.
 Employer will become responsible for the payment to the ESI contribution
after deduction of the employee contribution from the employee wage
 Employer should bear the expenses occurred in payment of contributions to
the Corporation.

GENERAL PROVISIONS AS TO PAYMENT OF CONTRIBUTIONS. [Section 42]

 No employee's contribution shall be payable by or on behalf of an employee

whose average daily wages during a wage period are below such wages as
may be prescribed by the Central Government.
 The average daily wages of an employee shall be calculated in such manner
as may be prescribed by the Central Government.

For Andhra Pradesh Employees in receipt of a daily average wage up to Rs.70/- are
exempted from payment of contribution.

METHOD OF PAYMENT OF CONTRIBUTION. [Section 43]

The ESI Corporation can make following rules and regulation in payment and
collection of contributions payable under this Act.

 The manner of payment of contribution

 The time of payment of contribution.
 Fixation of stamps for payment of contribution.
 Benefits distributed in the case of the insured persons by the corporation.
 Maintenance of books and cards of contribution of insured person by ESI
Corporation.
 The issue, sale, custody, production, inspection and delivery of books or
cards and the replacement of books or cards which have been lost, destroyed
or defaced.

EMPLOYERS TO FURNISH RETURNS AND MAINTAIN REGISTERS IN CERTAIN

CASES. [Section 44]

Every principal and immediate employer should submit to the Corporation or to such
officer of the Corporation as it may direct such returns in such form and containing
such particulars relating to persons employed by him.

Every principal and immediate employer shall maintain such registers or records in
respect of his factory or establishment
SOCIAL SECURITY OFFICERS, THEIR FUNCTIONS AND DUTIES. [SECTION 45]
(2010 amendment)

The Corporation may appoint such person as Social Security Officers, as it thinks fit,
for the purposes of this Act. The following are his functions and duties.

 Enquiring into the correctness of any of the particulars stated in any return
referred to in Section 44.
 Social Security Officers can demand any principal or immediate employer to
furnish to him such information as he may consider necessary for the
purposes of this Act.
 Social Security Officers can at any reasonable time enter any office,
establishment, factory or other premises for inspection of examine such
accounts, books and other documents relating to the employment of persons
and payment of wages or to furnish to him such information as he may
consider necessary.
 He can examine the employer, his agent or servant or any person found in
such factory, establishment, and office.
 He can make copies of, or take extracts from, any register, account book or
other document maintained in such factory, establishment, office or other
premises.
 He can do re-inspection whether the records and returns submitted under
Section 44 are correct or not.

[Section 45A] (2010 amendment)

If no records or particular of employed persons are not maintain as required under

this act by the his employer, social Security officer by order, determine the amount of
contributions payable in respect of the employees of that factory or establishment.
No order shall be passed by the Corporation in respect of the period beyond 5 years
from the date on which the contribution shall become payable.

THE SCHEDULE
MATTERS TO BE PROVIDED IN STANDING ORDER UNDER THIS ACT

1. Classification of workmen, e.g. whether permanent, temporary, apprentices,

probationers, or badlis.

2. Manner of intimating to workmen periods and hours of work, holidays, pay-days

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 rights 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 acts or omissions, which constitute

misconduct.

10. Means of redress for workmen against unfair treatment or wrongful exactions by
the employer or his agents or servants.

11. Any other matter, which may be prescribed.

[section 1(3)]. Applicability of the Act - The Act is applicable to all ‘industrial
establishments’ employing 100 or more workmen.

Provided that the appropriate Government may, after giving not less than two
month’s notice of its intention so to do, by notification in the official Gazette, apply
the provision of this Act to any industrial establishment employing such number of
persons less than one hundred as may be specified in the notification.

‘Industrial establishment’ means (i) an industrial establishment as defined in

section 2(i) of Payment of Wages Act (ii) Factory as defined in section 2(m) of
Factories Act (iii) Railway (iv) Establishment of contractor who employs workmen for
fulfilling contract with owner of an industrial establishment. [section 2(e)].

The term ‘industrial establishment’ includes factory, transport service, construction

work, mines, plantation, workshop, building activity, transmission of power etc.

Nothing in this Act shall apply to.

(i) Any industry to which the provisions of Chapter VII of the Bombay Industrial
Relations Act, 1946 (Bombay Act II of 1947) apply; or

(ii) Any Industrial establishment to which the provisions of the Madhya Pradesh
Industrial Employment (Standing Orders) Act, 1961 (Madhya Pradesh Act 26 of 1961
apply:
Provided that notwithstanding anything contained in the Madhya Pradesh Industrial
Employment (Standing Orders) Act, 1961 (Madhya Pradesh Act, 26 of 1961), the
provision of this Act shall apply to all industrial establishments under the control of
the Central Government.]

Section 14. Power to exempt

The appropriate Government may, by notification in the official Gazette,
exempt conditionally or unconditionally, any industrial establishment or class of
industrial establishment from all or any of the provisions of this Act.

“Wages” and “workman” have the meanings, respectively assigned to them

in Sec. 2 of the Industrial Disputes Act, 1947 (14 of 1947).

Section 13B. Act not to apply to certain Industrial

establishments
Act not to apply to certain Industrial establishments. Nothing in this Act shall apply to
an industrial establishment in so 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 Service (Classification,
Control and Appeal) Rules or the Indian Railway Establishment Code or any other
rules or regulations that may be notified in this behalf by the appropriate Government
in the official Gazette, apply.]

Approval of Standing Orders - Every employer covered under the Act has to
prepare ‘Standing Orders’, covering the matters required in the ‘Standing Orders’.
Five copies of these should be sent to Certifying Officer for approval. [section 3(1)].
‘Certifying Officer’ means Labour Commissioner and any officer appointed by
Government to be ‘Certifying Officer’. [section 2(c)].

The Certifying Officer will inform the Union and workmen and hear their
objections. After that, he will certify the ‘Standing Orders’ for the industrial
establishment. [section 5]. Till standing orders are certified, ‘Model Standing Order’
prepared by Government will automatically apply. [section12A].

Standing order should be displayed in English and local language on special

notice boards at or near entrance of the establishment. [section 9]. Modifications of
Standing Order shall be done by following similar procedure. [section 10].

Once the ‘Standing Orders’ are certified, they supersede any term and condition of
employment, contained in the appointment letter. If there is inconsistency between
‘Standing Order’ and ‘Appointment Letter’, the provisions of ‘Standing Order’ prevail -
Eicher Goodearth Ltd. v. R K Soni - (1993)
 Standing orders are binding on employer and employee. These are statutorily
imposed conditions of service. However, they are not statutory provisions
themselves (meaning that the ‘Standing Orders’ even when approved, do not
become ‘law’ in the sense in which Rules and Notifications issued under delegated
legislation become after they are published as prescribed.) - Rajasthan
SRTC v. Krishna Kant - AIR 1995

Model Standing Orders - The Act has prescribed Model Standing Orders. These
are automatically applicable till employer prepares his own ‘Standing Orders’ and
these are approved by ‘Certifying Officer’. [section 12A].

Disciplinary Action - The most important use of ‘Standing Orders’ is in case of

disciplinary action. A workman can be punished only if the act committed by him is a
‘misconduct’ as defined under the ‘Standing Orders’. The ‘Model Standing Orders’
contain such acts like insubordination, disobedience, fraud, dishonesty, damage to
employer’s property, taking bribe, habitual absence or habitual late attendance,
riotous behaviour, habitual neglect of work, strike in contravention of rules etc. as
misconducts. The ‘Certified Standing Orders’ may cover other acts as ‘misconduct’, if
approved by ‘Certifying Officer’.

Subsistence Allowance – Where a workman is suspended by employer pending

investigation or enquiry into complaints or charges of misconduct against him, the
workman shall be paid subsistence allowance equal to 50% of wages for first 90
days of suspension and 75% of wages for remaining period till completion of
disciplinary proceedings. [section 10A(1)]. - - ‘Wages’ has same meaning as under
section 2(rr) of Industrial Disputes Act. [section 2(i)].

Below shown sample pictures are of the Standing Orders of the Honourable
High Court. these are uploaded only for illustration purpose, to show
students how the Standing Orders looks like and make them understand
what it is contains.
 Employee's Compensation

EMPLOYER'S LIABILITY FOR COMPENSATION. [Sec

3]
(1) If personal injury is caused to a employee by accident arising out of and in the
course of his employment, his employer shall be liable to pay compensation in
accordance with the provisions of this Chapter:

Employer shall not be liable to pay compensation in the

following situations [Sec 3 (1)]
(a) Any injury which does not result in the total or partial disablement of
the workman for a period exceeding 3 days, employer is not liable to pay
the compensation.

(b) Accidents caused due to,

(i) the workman having been at the time thereof under the
influence of drink or drugs, (alcohol) or

(ii)the willful disobedience of the workman to an order expressly

given, or to a rule expressly framed, for the purpose of securing
the safety of workmen, or

(iii)
the willful removal or disregard by the workman of any safety
guard or other device which he knew to have been provided for the
purpose of securing the safety of workmen,

Occupational Diseases.[Sec 3]
An occupational disease is any chronic ailment that occurs as a result of work or
occupational activity. It is an aspect of occupational safety and health. An
occupational disease is typically identified when it is shown that it is more prevalent
in a given body of workers than in the general population, or in other worker
populations.

[Sec 3 (2)]

If any injury or disease is caused which is specified in Part A, B and C of Schedule

llI, it shall be deemed to have been an occupational disease or injury “arising out of
and in the course of employment” enabling the employee to claim compensation.
 Thus the Schedule III is divided in Part A, B & C in the following manner:—

If a employee employed in any employment specified in Part A of Schedule III

contracts any disease specified therein it shall be presumed that such disease is
“occupational disease” peculiar to that employment. For this no length of service
is prescribed.

If a employee is employed in any employment specified in Part B of Schedule III

for a period of 6 months and attracts any disease specified therein, it shall be
presumed that such disease is “occupational disease” peculiar to that
employment.

If a employee is employed in any employment specified in Part C of Schedule lll

for a period as is prescribed by the Central Govt, attracts any disease
specified therein as occupational disease, it shall be deemed to be an injury
peculiar to that employment.

Those provision can be presented in the following table.

Occupational Diseases or Injuries could be arisen out of and in the

course of employment
Schedule III read-with Section 3

Name of Diseases Length of the Service required

1. As specified in Part A No specific

period of service prescribed
2. As specified in Part B 6 months service
required
3. As specified in Part C Period of Service
as specified by the Central Govt.

The reason behind above conditions are, current employer shouldn’t be blamed for
the occupational disease caused to an employee by the previous employment. There
should be certain service time gap to decide whether current employer or previous
employer is liable for the occupation disease caused to an employee.

Diseases which are specified in part A,B.& C of the Schedule lll, need not to be
proved that they are 'occupational diseases' as they are already declared by
schedule lll. In respect of any disease not covered by schedule lll, it is must for an
employee to prove that such a disease was contracted in the course of employment.

SCHEDULE 3
LIST OF OCCUPATIONAL DISEASES
S. No. Occupational disease Employment
1 2 3
 PART A
1 Infectious and parasitic diseases (a) All work involving exposure to
contracted in an occupation where there is contracted in an occupation health or
a particular risk of contamination. laboratory work;
(b) All work involving exposure to
veterinary work;
(c) Work relating to handling animals,
animal carcasses, part of such carcasses, or
merchandise which may have been
contaminated by animals or animal
carcasses;
(d) Other work carrying a particular risk of
contamination.
2 Diseases caused by work in compressed All work involving exposure to the risk
air. concerned.
3 Diseases caused by lead or its toxic All work involving exposure to the risk
compounds. concerned.
4 Poisoning by nitrous fumes. All work involving exposure to the risk
concerned.
5 Poisoning by organo phosphorus All work involving exposure to the risk
compounds. concerned.
PART B
1 Diseases caused by phosphorus or its All work involving exposure to the risk
toxic compounds. concerned.

2 Diseases caused by mercury or its toxic
compounds.
3 Diseases caused by benzene or its toxic
homologues.
4 Diseases caused by nitro and amido toxic
derivatives of benzine or its homologues
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.

5 Diseases caused by chromium, or its toxic
compounds
6 Diseases caused by arsenic or its toxic
compounds.
7 Diseases caused by radioactive substances
or radiations.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the
substances and ionising action of radioactive
ionising radiations.
8 Primary epitheliomatous cancer of the
skin, caused by tar, pitch, bitumen,
mineral oil, anthracene, or the
compounds, products or residues of these
substances.
9 Disease caused by the toxic halogen
derivatives of hydrocarbons (of the
aliphatic and aromatic series).
10 Diseases caused by carbon disulphide.
11 Occupational cataract due to infra-red
radiations.
12 Diseases caused by manganese or its toxic
compounds.
13 Skin diseases caused by physical,
chemical or biological agents not included
in other items.
14 Hearing impairment caused by noise.
15 Poisoning by dinitrophenol or a All work involving exposure to the risk
homologue or by substituted dinitrophenol concerned.
or by the salts of such substances.
16 Diseases caused by beryllium or its toxic
compounds.
17 Diseases caused by cadmium or its toxic
compounds.
18 Occupational asthma caused by
recognised sensitising agents inherent to
the work process.
19 Diseases caused by fluorine or its toxic
compounds.
20 Diseases caused by nitroglycerine or other
nitroacid esters.
21 Diseases caused by alcohols and ketones.
22 Diseases caused by asphyxiants carbon
monoxide, and its toxic derivatives,
hydrogen sulfide.
23 Lung cancer and mesotheliomas caused
by asbestos.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
24 Primary neoplasm of the epithelial lining All work involving exposure to the risk
of the urinary bladder or the kidney or the concerned.
ureter.

25 Snow blindness in snow bound areas.
26 Disease due to effect of cold in extreme
cold climate.
27 Disease due to effect of cold in extreme
cold climate.
PART C
1 Pneumoconioses caused by sclerogenic
mineral dust (silicosis, anthraoosilicosis, concerned.
asbestosis) and silico-tuberculosis
provided that silicosis is an essential
factor in causing the resultant incapacity
or death.
2 Bagassosis.
3 Bronchopulmonary diseases caused by
cotton, flax hemp and sisal dust
(Byssinosis).
4 Extrinsic allergic alveelitiscaused by the
inhalation of organic dusts.
5 Bronchopulmonary diseases caused by
hard metals.
6 Acute Pulmonary Oedema of High
Altitude.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.
All work involving exposure to the risk
concerned.

AMOUNT OF COMPENSATION [Sec 4]

1. This section deals with how compensation is to be calculated for injured or
deceased employee.
2. Calculation of the compensation is made on the monthly wage or salary of
employee.
3. The amount of compensation varies from employee death, permanent total
disablement, permanent partial disablement and temporary disablement.

SCHEDULE I

PART I

LIST OF INJURIES DEEMED TO RESULT IN PERMANENT TOTAL

DISABLEMENT
Serial Description of injury % Percentage of loss of earning
No. capacity

1 Loss of both hands or amputation at higher 100

sites
2 Loss of a hand and foot 100

3 Double amputation through leg or thigh, 100

or amputation through leg or thigh on one
side and loss of other foot

4 Loss of sight to such an extent as to render 100

the claimant unable to perform any work
for which eye sight is essential

5 Very severe facial disfigurement 100

6 Absolute deafness

PART II
LIST OF INJURIES DEEMED TO RESULT IN PERMANENT PARTIAL
DISABLEMENT
Amputation Cases - Upper limbs - Either arm

1 Amputation through shoulder joint 90

2 Amputation below shoulder with stump 80

less than
20.32 cms. from tip of acromion
3 Amputation from 20.32 cms. from tip of 70
acromion to less than 4" below tip of
olecranon
4 Loss of a hand or of the thumb and four 60
fingers of one hand or amputation from
11.43 cms. below tip of olecranon

5 Loss of thumb 30

6 Loss of thumb and its metacarpal bone 40

7 Loss of four fingers of one hand 50

8 Loss of three fingers of one hand 30

 9 Loss of two fingers of one hand 20

10 Loss of terminal phalanx of thumb 20

Amputation cases - Lower limbs

10A Guillotine amputation of tip of thumb 10

without loss of bone

11 Amputation of both feet resulting in end 90

bearing stumps

12 Amputation through both feet proximal to 80

the metatarso-phalangeal joint

13 Loss of all toes of both feet through the 40

metatarso-phalangeal joint

14 Loss of all toes of both feet proximal to 30

the proximal inter-phalangeal joint

15 Loss of all toes of both feet distal to the 20

proximal inter-phalangeal joint

16 Amputation at hip 90

17 Amputation below hip with stump not 80

exceeding 12.70 cms. in length measured
from tip of great trenchanter but not
beyond middle thigh
18 Amputation below hip with stump 70
exceeding 12.70 cms. in length measured
from tip of great trenchanter but not
beyond middle thigh
19 Amputation below middle thigh to 8.89 60
cms. below knee

20 Amputation below knee with stump 50

exceeding 8.89 cms. but not exceeding
12.70 cms.
21 Amputation below knee with stump 50
exceeding 12.70 cms.

22 Amputation of one foot resulting in end 50

bearing
23 Amputation through on foot proximal to 50
the metatarso-phalangeal joint
24 Loss of all toes of one foot through the 20
metatarso-phalangeal joint

Other injuries

25 Loss of one eye, without complications, 40

the other being normal

26 Loss of vision of one eye, without 30

complications or disfigurement of eyeball,
the other being normal

26A Loss of partial vision of one eye 10

Loss of -
A - Fingers of right or left hand
Index finger

27 Whole 14

28 Two phalanges 11

29 One phalanx 9

30 Guillotine amputation of time without loss 5

of bone

Middle finger

31 Whole 12

32 Two phalanges 9

33 One Phalanx 7

34 Guillotine amputation of tip without loss 4

of bone
Ring or little finger

35 Whole 7

36 Two phalanges 6

37 One Phalanx 5

38 Guillotine amputation of tip without loss 2

of bone
 B - Toes of right or left foot
Great toe

39 Through metatarso-phalangeal joint 14

40 Part, with some loss of bone 3

Any other toe

41 Through metatarso-phalangeal joint 3

42 Part with some loss of bone 1

Two toes of one foot, excluding great toe

43 Through metatarso-phalangeal joint 5

44 Part, with some loss of bone 2

Three toes of one foot, excluding great toe

45 Through metatarso-phalangeal joint 6

46 Part, with some loss of bone 3

Four toes of one foot, excluding great toe

47 Through metatarso-phalangeal joint 9

48 Part-with some loss of bone 3

SCHEDULE IV

(See section 4)
FACTORS FOR WORKING OUT LUMP SUM EQUIVALENT OF COMPENSATION
AMOUNT IN CASE OF PERMANENT DISABLEMENT AND DEATH.

Completed years of age on the last birthday Factors

of the employee immediately preceding the

date on which the compensation fell due

Not 16 . . . . . . 228.54
more
than
17 . . . . . . 227.49
18 . . . . . . 226.38
19 . . . . . . 225.22
20 . . . . . . 224
21 . . . . . . 222.71
22 . . . . . . 221.37
23 . . . . . . 219.95
24 . . . . . . 218.47
25 . . . . . . 216.91
26 . . . . . . 215.28
27 . . . . . . 213.57
28 . . . . . . 211.79
29 . . . . . . 209.92
30 . . . . . . 207.98
31 . . . . . . 205.95
32 . . . . . . 203.85
33 . . . . . . 201.66
34 . . . . . . 199.4
35 . . . . . . 197.06
36 . . . . . . 194.64
37 . . . . . . 192.14
38 . . . . . . 189.56
39 . . . . . . 186.9
40 . . . . . . 184.17
41 . . . . . . 181.37
42 . . . . . . 178.49
43 . . . . . . 175.54
44 . . . . . . 172.52
45 . . . . . . 169.44
46 . . . . . . 166.29
47 . . . . . . 163.07
48 . . . . . . 159.8
49 . . . . . . 156.47
50 . . . . . . 153.09
51 . . . . . . 149.67
52 . . . . . . 146.2
53 . . . . . . 142.68
54 . . . . . . 139.13
55 . . . . . . 135.56
56 . . . . . . 131.95
57 . . . . . . 128.33
58 . . . . . . 124.7
59 . . . . . . 121.05
60 . . . . . . 117.41
61 . . . . . . 113.77
62 . . . . . . 110.14
63 . . . . . . 106.52
64 . . . . . . 102.93
 65 or more . . . . . 99.37

Method of calculating wages: [section 5]

The method of calculating monthly wage is prescribed and it is laid down that way to
the workman has worked during a continuous period of not less than 12 months, the
monthly wage shall be 1/12 of the total wages fallen due to him by the employer in
the last 12 months ( clause (a)).

Where Workman was employed for less then a month

the monthly wages of the workmen shall be calculated on the basis of the wages
earned by the workmen employed by such employer for the similar work. If no such
other workman is employed, then wages shall be calculated on the basis of the
wages paid to a workman employed on similar work in the same locality.

where the calculation is not possible in both ways as explained above, then the
monthly wages shall be 30 times the total wages earned by the workman divided by
the number of days comprising such period.

For calculating the continuous service under this section, the absence of 14 days
shall not be treated as interruption.

Circumstances under which employer is

liable to pay compensation to the
employee

Compensation in case of death of employee [Sec 4(1)

(a)]
While calculating the compensation of the workman, age of the workman and
relevant factor is taken in to account.

50% of monthly wages of the deceased employee X relevant factor with

corresponding age of injured workman specified in Schedule IV.
or
1,20,000/- rupees of compensation.
Whichever is more.

Example: Muniyappa, a worker aged 35 meets with an accident and dies while at
work (i.e. in the course of employment). At the time he drew a monthly wage of
Rs.2,500/-. As per Schedule IV of the Act the relevant factor applicable to his case
would be Rs. 197.06. As such, the amount of compensation payable to his
dependants will be arrived at in the following way:

(i) 50% of Rs. 2,500 = 1,250

(ii) 1,250 x relevant factor (i.e.197.06) =

Rs.2,46,325.00/- (total compensation payable)

Compensation in case of permanent total

disablement [Sec 4(1) (b)]
60% of monthly wages of employee X relevant factor with corresponding age of
injured workman specified in Schedule IV .
or
1, 40,000/- rupees of compensation.
Whichever is more.

For above the calculation of the compensation in case of death or permanent partial
disablement, the monthly wage of workman is limited to 4000/- Rupees only. Or the
government may prescribe and change the monthly wage amount for calculation of
the compensation.

Example: Shyam, a worker aged 35 meets with an accident and suffers permanent
total disablement while at work (i.e. in the course of employment) At the time she
drew a monthly wage of Rs.2,500/- The amount of compensation payable will be
arrived at as follows:

(i) 60% of Rs. 2,500 = 1,500

(ii) 1,500 x relevant factor (i.e. 197.06) =

2,95,590.00/- (total compensation payable)

‘‘Provided that the Central Government may, by notification in the Official

Gazette, from time to time, enhance the amount of compensation
mentioned in above both cases"

Compensation in case of permanent partial disablement

[Sec 4(1) (c)]

Injury specified in Part II of Schedule I.

The calculation of the compensation is similar to that of permanent

total disablement.
Example:
Part II of schedule I
Nature of
injury Percentage of loss of
disablement

(1) Amputation to shoulder

joint 90%
(2) Amputation to below
shoulder 80%
(3) loss of fingers of one
hand 50%
(24) Loss of all toes of one
foot 20%
(48) part of some loss of
bone 3%

Part II of schedule I contains 48 entries specifying various nature of injuries in left-

hand column and corresponding percentage of disablement.

In case of (1) Amputation to shoulder joint

90% of monthly wages of employee X relevant factor with corresponding age of
injured workman specified in Schedule IV .
or
1, 40,000/- rupees of compensation.
Whichever is more.

More injuries than one are caused by the same accident

All injuries compensation caused by same accident will be added but compensation
amount payable should not exceed more than what would have been payable in the
case of permanent partial disablement.

In case of an injury not specified in the scheduled I

Percentage of total permanent disablement as is proportionate to the loss of earning
capacity as may be determined by the medical practitioner.

In case of temporary disablement with the total or partial

results from the injury
1. Employer is liable to reimburse the actual medical expenditure incurred by the
employee for treatment of injuries caused to during the course of employment.
2. Employer is liable to pay injured employee with half monthly wages for a
period of disablement, subject to a maximum of five years.

Medical examination - [Section 11]

  In case of payment of half monthly wages to an employee, such employee may
be required to produce himself before the doctor at such intervals according
to [Medical examination - Section 11(1)]
 if the employee refuses to produce himself before the doctor as required by the
employer, for free of cost, in such case, employee right to any compensation
will be rejected during the period of his refusal or failure to appear before the
doctor. [Section 11(2)]
 if the employee leaves the vicinity of his place of employment without medical
examination, employee right to compensation shall be rejected until he returns
and offers himself a medical examination [Section 11(3)].
 if the employee dies without such medical examination, the Commissioner of
employee's compensation, if he thinks fit, may direct the payment of
compensation to the dependents of the employee [Section 11(4)].
 If the injury of any injured employee is aggravated due to his failure or refusal
to appear for a medical examination or after having so appeared, failure to
follow the instructions of Doctor, in that case such employee will not be entitled
to any compensation for the aggravated injuries but will be entitled to injuries
only resulted in the disablement if the employee had regularly attended and
followed the instructions of the doctor [Section 11(6)]

NOTE: If the injury to the employee caused disablement for not more 3 days, in
such a case employer is not liable to pay any compensation to the employee, except
the medical expenditure

Compensation in case of Temporary disablement [Sec

4(1) (d)]
Ramamurthy (Road sweeper employed on contract basis for Bangalore City
Corporation) slipped and fell from a garbage truck and fractured his hand. He could
not work for one month. This is temporary disablement.

In case of temporary disablement, payments equal to 25 % of the workers' wages

shall be made at fortnightly intervals (every two weeks). [Sec 4(2)] In case the
disablement lasts for more than 28 days, the employer should make the payment on
the 16th day from the day of the disablement.

If the period of disablement lasts for less than 28 days, the payment shall be made
after the expiry of 3 days. This wait for 3 days is to ascertain how long the temporary
disablement will last—less than/equal to 28 days or more.

In case the employer makes any payment to the worker before the payment of this
half monthly (every two weeks) or lump sum amount, it shall be deducted from any
lump sum or half-monthly payments. [Section 4 (2) (a)]

[Sec 4(2A)]

The employee shall be reimbursed the actual medical expenditure incurred by him
for treatment of injuries caused during course of employment.
If the injury of the workman results in his death, [Sec
4(4)]
The employer shall, in addition to the compensation for death as calculated above,
deposit with the Commissioner a sum of Rs.5000/- for payment of the same to the
eldest surviving dependent of the workman towards the expenditure of the funeral of
such workman or if the workman did not have a dependent or was not living with his
dependent at the time of his death, the funeral expenditure should be paid to the
person who actually incurred such expenditure.

‘‘Provided that the Central Government may, by notification in the Official

Gazette, from time to time, enhance the amount of towards the funeral
expenditure"

COMPENSATION TO BE PAID WHEN DUE AND

PENALTY FOR DEFAULT. [Sec 4A].
Employer must pay the compensation to the workman within one month of time. If
employer fails to pay the compensation within one month of time, the commissioner
can direct the employer to pay Compensation amount by adding 12% of simple
interest per annum or specified by the Central Government.

If there is no proper reason or there is no justification by the employer for delay in

payment of compensation, in that case the commissioner can direct the employer to
pay extra sum of not exceeding 50% of compensation amount as the penalty. [Sec
4A (b)]

REVIEW [Sec 6]

 In the case of temporary disablement of the workman, employer should pay

the amount as compensation for every two weeks.
 If workman condition is improving, employer can make a application to the
commissioner for reduction of compensation amount payable
 If the workman condition is becoming worse, with the help of the qualified
medical practitioner can make an application to commissioner for increase in
compensation amount payable for every two weeks.
 If the accident is found to have resulted in permanent disablement, be
converted to the lump sum to which the workman is entitled less any amount
which he has already received by way of half-monthly payments.

COMMUTATION OF HALF-MONTHLY PAYMENTS

[Sec 7]
In the case of temporary disablement of the workman, his compensation amount can
settlement by way of lump sum amount or can make an application to commissioner
for settlement of lump sum amount after a period of at least 6 months.

DISTRIBUTION OF COMPENSATION. [Sec 8]

 Compensation must be paid to the dependents only. No other persons except
dependents having are right to claim compensation.
 Compensation should not be paid directly to the workman by his employer in
case of injury or death etc.
 Employer should deposit the workman compensation with the commissioner.
 The deposited compensation to workman shall be paid through the
commissioner to the workman.
 If no dependent is there for deceased (dead) workman, there is no necessity
to pay compensation by the employer. [Sec 8 (4)].
 If two or more dependents exist for a deceased workman, the compensation
amount shall be distributed by the commissioner according to his wish. [Sec 8
(5)].
 If the workman dependent is of legal disability ((a minor), or mental capacity)
or neglect of children, the compensation amount shall be invested for their
according to the directions of the commissioner.

Compensation not to be assigned, attached or charged

[Sec 9]
Except to the workman, compensation should not be passed or attached to other
person. Only in case of death of the employee, such compensation should be given
to his/her dependents.

NOTICE AND CLAIM. [Sec 10]

After the occurrence of the accident to the workman, giving notice to the employer is
must.
After the occurrence of the accident to workman or the death of the workman, with in
2years notice should be given to the employer.
Without giving notice of accident or death of the workman, claim of compensation is
not considered by the commissioner.
Every notice given to employer about the accident of the workman should contain
the following details.
a) Name of the injured workman.
b) Address of the injured workman.
c) Date on which the accident happened.
Notice should be registered post addressed.

POWER TO REQUIRE FROM EMPLOYERS STATEMENTS REGARDING FATAL

ACCIDENTS.[Sec 10A]
Commissioner receives information from any source about the death of the workman
or the occurrence of the accident to the workman under employment, he is having
power to send notice to employer through registered post demanding the employer
fro explanation about the cause and reasons for the accident or the death of the
workman.

Within 30 days from the receipt of the notice from commissioner by the employer has
to submit all the details of the accident or the death of the workman. Employer
should mention whether he is liable to pay the compensation or not liable to pay the
compensation to the workman.

 If employer accepts the liability to pay the compensation to the workman,

employer should deposit the compensation with the commissioner with in
3oday from the receipt of the notice.
 If employer rejects the liability to the compensation to the workman, employer
should mention all details why he is not so liable.

REPORTS OF FATAL ACCIDENTS AND SERIOUS BODILY INJURIES. [Sec 10B]

After the occurrence of the accident results in death of the workman, or serious
bodily injury of the workman, employer should give notice to the authority appointed
by the state government within 7 days.

Explanation : "Serious bodily injury" means an injury which involves, or in all

probability will involve, the permanent loss of the use of, or permanent injury to, any
limb, or the permanent loss of or injury to the sight or hearing, or the fracture of any
limb, or the enforced absence of the injured person from work for a period exceeding
twenty days.

CONTRACTING. [Sec 12]

In case of contracting, the principal (person who employed the workman fro contract)
or contractor (principal for the purposes of his trade or business contracts with any
other person) is liable to pay the compensation to the employed workman who is
injured.

INSOLVENCY OF EMPLOYER [Sec 14]

In the case where the employer of the worker has entered into an agreement with
insurers (insurance company), to pay compensation and subsequently the employer
(may be company) becomes insolvent or closing down of company, then in the event
of any accident happening, the employer’s liabilities will be transferred to the
insurers, and they would be treated as the employers of the aggrieved worker for the
purpose of paying compensation.

Compensation cannot be claimed from the insurer in any case in which the workman
fails to give notice to the insurers of the happening of the accident and of any
resulting disablement as soon as practicable after he becomes aware of the
institution of the insolvency or liquidation proceedings.
If the liability of the insurers is to be less than that of the original employers, then the
worker can claim the balance amount from the insolvency proceedings. [Sec 4(2)]

If employer has taken insurance to cover claims arising out of workers’ accidents, the
insurance company will be responsible to pay compensation. It is interesting that in
such cases were an employer has taken insurance and the employer will back the
worker’s claim against the insurance company! Naturally, as insurance company is
not responsible to pay the worker compensation. The practice of taking insurance is
common only amongst the bigger contractors/ companies.

In the case of the compensation being half monthly payments (every two weeks), the
insurers may convert that to an appropriate lump sum and pay that compensation to
the worker. [Sec14 (5)]

SPECIAL PROVISIONS RELATING TO MASTERS AND SEAMEN. [Sec 15]

 Master of the ship is treaded as the employer and seamen are treated as the
workman employed under him.
 Notice of the accident and disablement to the seaman is not necessary, if it
has happened on board of the ship.
 In the case of the death of a master or seaman, the claim for compensation
shall be made within one year after the news of the death has been received
by the claimant. [Sec 15(2)]
 In case ship has lost the claim for compensation by claimant shall be made
within 18 months from the date ship is lost.

SPECIAL PROVISIONS RELATING TO CAPTAINS AND OTHER MEMBERS OF

CREW OF AIRCRAFT'S. [Sec 15A]

 Captain of the aircraft is treaded as the employer and crew are treated as the
workman employed under him.
 Notice of the accident and disablement to the crew is not necessary, if it has
happened on board of the aircraft.
 In the case of the death of a Captain of the aircraft r or crew, the claim for
compensation shall be made within one year after the news of the death has
been received by the claimant. [Sec 15A(2)]
 In case aircraft has lost, the claim for compensation by claimant shall be
made within 18 months from the date ship is lost..

SPECIAL PROVISIONS RELATING TO WORKMEN ABROAD OF COMPANIES

AND MOTOR VEHICLES. [Sec 15B]

(i) in the case of workmen who are persons recruited by companies registered in
India and working as such abroad, and

(ii) persons sent for work abroad along with motor vehicles registered under
the Motor Vehicles Act, 1988 (59 of 1988) as drivers, helpers, mechanics, cleaners
or other workmen, subject to the following modifications, namely :- (1) The notice of
the accident and the claim for compensation may be served on the local agent of the
company, or the local agent of the owner of the motor vehicle, in the country of
accident, as the case may be,

(2) In the case of death of the workman in respect of whom the provisions of this
section shall apply, the claim for compensation shall be made within one year after
the news of the death has been received by the claimant:

CONTRACTING OUT [Sec 17]

Any contractor agreement made for give-up of compensation from the employer in
case of the accident or the death of the workman is void and not valid.

PENALTIES. [Sec 18A.]

Fine of rupees 5000/- as the punishment for disobeying the following

1. Fails to maintain the notice-book of the workman employed at premises by the

employer.
2. Employer fails to send a statement with in 30days of the receipt of the notice
from commissioner demanding the reasons for cause of the accident to the
workman.
3. Employer fails to send a statement with in 7days to the commissioner the
reasons for cause of the serious bodily injuries to the workman.
4. Employer fails to mention correct number of injuries for which compensation
has to be paid.

APPOINTMENT OF COMMISSIONER. [Sec 20]

(1) The State Government may, by notification in the Official Gazette, appoint any
person who is or has been a member of a State Judicial Service for a period of not
less than five years or is or has been for not less than five years an advocate or a
pleader or is or has been a Gazetted officer for not less than five years having
educational qualifications and experience in personnel management, human
resource development and industrial relations”

(2) Where more than one Commissioner has been appointed for any area, the State
Government may, by general or special order, regulate the distribution of business
between them.

(3) Any Commissioner may, for the purpose of deciding any matter referred to him
for decision under this Act, choose one or more persons possessing special
knowledge of any matter relevant to the matter under inquiry to assist him in holding
the inquiry.

(4) Every Commissioner shall be deemed to be a public servant within the meaning
of the Indian Penal Code (45 of 1860).
FORM OF APPLICATION [Sec 22]

 Application should be made before the commissioner by the dependents of

the workman for claiming the compensation
 Fee is necessary for Application to commissioner. [sec 22(2)]
 Application form should consist the following details
a) Reason for application for compensation
b) Relief they need.
c) Claims

 Date of the notice given to the employer about the accident of the employer
 If application is illiterate, he or she can take help of other person in preparing
the application form.

REGISTRATION OF AGREEMENTS.[Sec 28]

When there is agreement (memorandum) of compensation in between workman and

employer for lump sum amount settlement against the half monthly payments (every
two weeks payments) to the women or a person under a legal disability, employer
should sent the memorandum to the commissioner.

Memorandum should not be obtained by fraud, undue influence or other improper

means. If the commissioner satisfies with memorandum, it shall be registered.

[Sec 29]
If memorandum of agreement is not send to commissioner by the employer shall be
liable to pay the full amount of compensation which he is liable to pay.

Appeals [Sec 30]

In the following circumstance the employer or workman can appeal to High court of
that state

(a) an order awarding as compensation a lump sum whether by way of redemption of

a half-monthly payment or otherwise or disallowing a claim in full or in part for a lump
sum;
(aa) an order awarding interest or penalty under section 4A;
(b) an order refusing to allow redemption of a half-monthly payment;
(c) an order providing for the distribution of compensation among the dependants of
a deceased workman, or disallowing any claim of a person alleging himself to be
such dependant;
(d) an order allowing or disallowing any claim for the amount of an indemnity under
the provisions of sub-section (2) of section 12; or
(e) an order refusing to register a memorandum of agreement or registering the
same or providing for the registration of the same subject to conditions
Bill Summary
Industrial Disputes (Amendment) Bill, 2009

The Industrial Disputes (Amendment) Bill, 2009, was introduced in the Rajya Sabha
on February 26, 2009 by the Minister of Labour and Employment Shri Oscar
Fernandes. The Bill was passed by the Lok Sabha on August 10, 2010 and the
Rajya Sabha on August 3, 2010.ƒ

1. The Bill amends the Industrial Disputes Act, 1947. The Act provides for
settlement of disputes between workers and management.
2. Persons who are employed in a supervisory capacity and draw more than Rs
1,600 per month are excluded from the purview of the Act. The Bill raises this
ceiling to Rs 10,000 per month.
3. Depending on the type of institution involved in an industrial dispute, either the
central or the state government is given powers to administer various
provisions of the Act. The Bill expands the list of institutions for which disputes
will be administered by the central government to include: (a) companies
where 51% or more of shares are held by the central government, (b) central
public sector undertakings or their subsidiaries (c) corporations set up under a
law made by Parliament and (d) autonomous bodies owned or controlled by
the central government.
4. The Bill specifies that state governments shall administer disputes in state
public sector undertakings or their subsidiaries. State governments shall also
administer disputes in autonomous bodies owned or controlled by them.
5. Under the Act, a worker whose services were terminated can complain to the
government, which may refer the caseto a court or tribunal. The Bill allows a
workman to directly approach the court or tribunal three months after filing
such a complaint. An application to the court or tribunal must be
made within three years of termination of service.
6. The Bill requires all industrial establishments with more than 20 workmen, to
set up one or more grievance redressal committees to resolve grievances of
individual workmen. ƒ
7. The committee shall consist of up to six members with equal representation
from the employer and the workmen, with adequate representation for
women. The chairperson shall be appointed alternately by the employer or
from amongst the workmen every year.
8. The committee must reach a decision on any complaint within 45 days.
Workmen can appeal against the decision to the employer, who has a month
to respond.
9. The existence of such a committee does not affect the rights available to
workmen under other provisions of the Act.
10. The Bill broadens the scope of qualifications required for presiding officers of
courts or tribunals established under the Act. Such officers can now include
those who (a) have been a Deputy Chief Labour Commissioner (Central) or
Joint Commissioner, with a degree in law, and at least seven
years experience in the Labour Department, including three years as a
conciliation officer, or (b) have been an officer of the Indian Legal Service with
three years experience in Grade III.
 11. All awards or settlements made by labour courts or tribunals shall be
executed by the relevant civil court according to the Code of Civil Procedure.

SCOPE AND OBJECT

The Industrial Dispute Act of 1947, came into force on the first day of April, 1947. Its
aim is to protect the workmen against victimization by the employers and to ensure
social justice to both employers and employees. The unique object of the Act is to
promote collective bargaining and to maintain a peaceful atmosphere in industries by
avoiding illegal strikes and lock outs. The Act also provides for regulation of lay off
and retrenchment. The objective of the Industrial Disputes Act is to secure industrial
peace and harmony by providing machinery and procedure for the investigation and
settlement of industrial disputes by negotiations.
DEFINITIONS

Appropriate Government [Sec. 2(a)]: Appropriate Government means the Central

Government in relation to any industrial dispute concerning any industry carried on
by or under the authority of the Central Government, any industry carried on by a
Railway Company, any controlled industry specified by the Central Government, The
Unit Trust of India. Corporations under the Central Statutes, Banking company,
Insurance company. Mines. Oil field, Cantonment board, Major ports, etc. In relation
to any other industrial dispute, the appropriate Government is the State
Government.

Award [Sec 2 (b)] means an interim or a final determination of any industrial dispute
or of any question relating thereto by any Labour Court, Industrial Tribunal or
National Industrial Tribunal and includes an arbitration award made under section
10A;

Industry [Sec. 2(j)]: Industry means any business, trade, undertaking, manufacture
or calling of employers and includes any calling, service, employment, handicraft or
industrial occupation or avocation of workmen.

Industrial Dispute [Sec. 2(k)]: means any dispute or difference between employers
and employers, or between employers and workmen, or between workmen and
workmen, which is connected with the employment or non-employment or the terms
of employment or with the conditions of labour, of any person.

PUBLIC UTILITY SERVICES

FIRST SCHEDULE

INDUSTRIES WHICH MAY BE DECLARED TO BE PUBLIC UTILITY SERVICES

UNDER SUB-CLAUSE (VI) OF CLAUSE (N) OF SECTION 2

1. Transport (other than railways) for the carriage of passengers or goods by

land or water.
2. Ports or Docks
3. any postal, telegraph or telephone service;
4. any industry which supplies power, light or water to the public
5. any system of public conservancy or sanitation;
6. Banking.
7. Cement.
8. Coal.
9. Cotton textiles.
10. Foodstuffs.
11. Iron and steel.
12. Defence establishments.
13. Service in hospitals and dispensaries.
14. Fire brigade service.
15. India Government Mints.
 16. India Security Press.
17. Copper Mining.
18. Lead Mining.
19. Zinc Mining.
20. Iron Ore Mining.
21. Service in any oil field.
22. Omitted
23. Service in uranium industry.
24. Pyrites mining industry.
25. Security Paper Mill, Hoshangabad.
26. Services in Bank Note Press, Dewas.
27. Phosphorite mining.
28. Magnesite Mining.
29. Currency Note Press.
30. Manufacture or production of mineral oil (crude oil), motor and aviation spirit,
diesel oil, kerosene oil, fuel oil, diverse hydrocarbon oils and their blends
including synthetic fuels, lubricating oils and the like.
31. Service in the International Airports Authority of India.
32. Industrial establishments manufacturing or producing Nuclear Fuel and
Components, Heavy Water and Allied Chemicals & Atomic Energy.

2(k) "industrial dispute" means any dispute or difference between employers and
employers, or between employers and workmen, or between workmen and
workmen, which is connected with the employment or non-employment or the terms
of employment or with the conditions of labour, of any person;

Settlement [Sec. 2(p)]: Settlement means a settlement arrived at in the course of

conciliation proceeding and includes a written agreement between an employer and
a workman arrived at otherwise than in the course of conciliation proceeding where
such agreement has been signed by the parties thereto in such manner as may be
prescribed and a copy thereof has been sent to an officer authorised by the
Appropriate Government and the Conciliation Officer.

Wages [Sec. 2(rr)]: Wages mean all remuneration capable of being expressed in
terms of money, which would, if the terms of employment, express or implied were
fulfilled, be payable to a workman in respect of his employment or of the work done
in such an employment and includes:

(i) such allowances (including dearness allowance) as the workman is for the time
being entitled to;

(ii) the value of any house accommodation, or of supply of light, water, medical
attendance or other amenity or of any service or of any concessional supply of food
grains or other articles;

(iii) Any traveling concession. But the following are excluded:

(a) Any bonus.
(b) Any contribution paid or payable to any pension fund or provident fund, or for the
benefit of the workman under any law for the time being in force.
(c) Any gratuity payable on the termination of his service.

2(n) "Public utility service" means -

(i) any railway service or any transport service for the carriage of passengers or
goods by air;
(ia) any service in, or in connection with the working of, any major port or dock;
(ii) any section of an industrial establishment, on the working of which the safety of
the establishment or the workmen employed therein depends;
(iii) any postal, telegraph or telephone service;
(iv) any industry which supplies power, light or water to the public;
(v) any system of public conservancy or sanitation;
(vi) any industry specified in the First Schedule which the appropriate Government
may, if satisfied that public emergency or public interest so requires, by notification in
the Official Gazette, declare to be a public utility service for the purposes of this Act,
for such period as may be specified in the notification

DISPUTE SETTLEMENT AUTHORITIES UNDER THE ACT

The I.D. Act provides elaborate and effective machinery for the investigation and
amicable settlement of industrial disputes by setting up the various authorities.
These are:

1. Works Committee;
2. Conciliation Officer;
3. Conciliation Board;
4. Court of Enquiry;
5. Labour Court;
6. Industrial Tribunal;
7. National Tribunal;
8. Arbitrators;
9. Grievances Settlement Authority.

DISMISSAL, ETC., OF AN INDIVIDUAL WORKMAN TO BE DEEMED TO BE AN

INDUSTRIAL DISPUTE. [Sec 2A]

Difference in between the workman and his employer connected arising out of
following activities shall be deemed to the industrial dispute.

 Dismissal of workman
 Discharge of workman
 Retrenchment of the workman
 Termination of workman from his services
[Sec 2A (2)]

Workman having the disputes can make a application to the conciliation officer to
settle the dispute. After the expiry of 3 months of time conciliation officer fails to
settle the dispute, workman can make a direct application to labour courts or
tribunals for adjudication.

[Sec 2A (3)]

Workman should make an application to labour courts or tribunals for adjudication

before the expiry of 3 years from the date of discharge, dismissal, retrenchment or
otherwise termination of service of workman,

WORKS COMMITTEE [Sec. 3]: In the case of an industrial establishment in which

100 or more workmen are employed, the appropriate Government may require the
employer to constitute a 'Work Committee'. It consists of equal number of
representatives of employers and workmen engaged in the establishment. The
representatives of the workmen shall be chosen from amongst the workmen
engaged in the establishment and in consultation with the registered trade union, if
any. Works committee deals with the workers problem arising day to day in the
industrial establishment.

CONCILIATION OFFICER [Sec. 4]: The appropriate Government is empowered to

appoint any number of persons, as it thinks fit, to be conciliation officers. The
conciliation officer having duty of mediating and acts as the mediators in between the
parties to resolve the dispute.

In the case of public utility services matters like strikes and lockouts the conciliation
officer can initiate the conciliation proceeding ad tries to settle the dispute in between
the parties.

If the conciliation officer fails to resolve the dispute between the parties, he should
report to the appropriate government. If necessary the dispute shall be referred to
the Board, Labour Court, Tribunal or National Tribunal, by the appropriate
government. [Sec 12 (5)]

Duties of conciliation officers. [Sec 12]

 Hold conciliation proceedings relating to Strikes and lockouts procedural

matters of public utility services.
 Investigate the matters of the disputes.
 Conciliation officers shall induce the parties to come to a fair and amicable
settlement of the dispute.
 Duty to send the report of settlement of dispute and memorandum of the
settlement signed by the parties to the dispute to the government or his
superior.
 In case of failure of settlement of dispute in between parties, duty to send
them to the government or his superior, report of facts and circumstances
relating to the disputes and in his opinion, a settlement could not be arrived at,
  Duty to send the report to the government or his superior within 14 days from
the commencement of the proceeding. or within such shorter period as may
be fixed by the appropriate Government .

CONCILIATION BOARD [Sec. 5]: as occasion arises appropriate Government is

also authorised to constitute a Board of conciliation for promoting the settlement of
an industrial dispute. It consists of a chairman who shall be an independent person,
and two or four other members. The members appointed shall be in equal numbers
to represent the parties to the dispute. On the dispute being referred to the Board it
is the duty of the Board to do all things as it thinks fit for the purpose of inducing the
parties to come to fair and amicable settlement.

If there are many parties relating to or in the dispute the government may appoint the
conciliation board consisting of the above said members

According to [Sec 10 (2)] when parties in the industrial dispute apply to the
government to refer dispute to the Conciliation Board and if government satisfies it
shall make the reference to the Conciliation Board.

Duties of board. [Sec 13]

 it shall be the duty of the Board to endeavor to bring about a settlement of

dispute.

 Investigate the matters relating to the dispute between parties and inducing
the parties to come to a fair and amicable settlement of the dispute.

 In case of failure of settlement of dispute in between parties, duty to send to

the government the report of facts and circumstances relating to the disputes
and board opinion, a settlement could not be arrived at,

 The Board shall submit its report under this section within 2 months of the
date on which the dispute was referred to it or within such shorter period as
may be fixed by the appropriate Government.

COURT OF ENQUIRY [Sec. 6]: as occasion arises, Government can initiate a Court
of Inquiry. This Court of Inquiry was to find out matters connected with or relevant to
an industrial dispute. Where a Court consists of two or more members, one of them
shall be appointed as the chairman.

A Court of Inquiry looks into only matters which are referred to it by Government and
submits its report to the Government ordinarily within certain period from the date of
reference.

ADJUDICATION

Labour Court [Sec. 7]: The appropriate Government is empowered to constitute

one or more Labour Courts. Its function is the adjudication of industrial disputes
relating to any matter specified in the Second Schedule.

MATTERS WITHIN THE JURISDICTION OF LABOUR COURTS.

SECOND SCHEDULE

1. The propriety or legality of an order passed by an employer under the

standing orders;
2. The application and interpretation of standing orders;
3. Discharge or dismissal of workmen including reinstatement of, or grant of
relief to, workmen wrongfully dismissed;
4. Withdrawal of any customary concession or privilege;
5. Illegality or otherwise of a strike or lock-out; and

 According to [Sec 10 (1) (c)] matters specified in THIRD SCHEDULE, dispute

not effecting more than 100 workers can be referred to labour court.

 According to [Sec 10 (2)] when parties in the industrial dispute apply to the
government to refer dispute to the labour court and if government satisfies it
shall make the reference to the labour courts.

 According to [Sec 10 (6)] no Labour Court or Tribunal shall have jurisdiction to

adjudicate upon any matter which is under adjudication before the National
Tribunal.

A Labour Court consists of one person only. A person is qualified to be appointed as

presiding officer of a Labour Court, if:

(a) he is, or has been a judge of a High Court, or

(b) he has been a District judge or an Additional District judge for at least three
years, or

(c) he has held the office of the chairman or any other member of the Labour
Appellate Tribunal or of any Tribunal for at least two years, or

(d) he has held any judicial office in India for not less than seven years, or

(e) he has been the presiding officer of a Labour Court constituted under any
Provincial Act or State Act for at least five years.

(f) he is or has been a Deputy Chief Labour Commissioner (Central) or Joint

Commissioner of the State Labour Department , having a degree in law and at least
7 years’ experience in the labour department after having acquired degree in law
including three years of experience as Conciliation Officer:

(g) as the case may be, before being appointed as the presiding officer; or (g) he is
an officer of Indian Legal Service in Grade III with three years’ experience in the
grade.”
Industrial Tribunal [Sec. 7A]: The appropriate Government may, by notification in
the Official Gazette, constitute one or more Industrial Tribunals for the adjudication of
industrial disputes relating to any matter, whether specified in the Second Schedule
or the Third Schedule and for performing such other functions as may be assigned to
them under this Act.

SECOND SCHEDULE

1. The propriety or legality of an order passed by an employer under the standing

orders;
2. The application and interpretation of standing orders;
3. Discharge or dismissal of workmen including reinstatement of, or grant of relief to,
workmen wrongfully dismissed;
4. Withdrawal of any customary concession or privilege;
5. Illegality or otherwise of a strike or lock-out; and

THIRD SCHEDULE

1. Wages, including the period and mode of payment;

2. Compensatory and other allowances;
3. Hours of work and rest intervals;
4. Leave with wages and holidays;
5. Bonus, profit sharing, provident fund and gratuity;
6. Shift working otherwise than in accordance with standing orders;
7. Classification by grades;
8. Rules of discipline;
9. Rationalisation;
10. Retrenchment of workmen and closure of establishment; and
11. Any other matter that may be prescribed.

 According to [Sec 10 (2)] when parties in the industrial dispute apply to the
government to refer dispute to the industrial tribunal and if government
satisfies it shall make the reference to the industrial tribunal.

 According to [Sec 10 (6)] no Labour Court or Tribunal shall have jurisdiction to

adjudicate upon any matter which is under adjudication before the National
Tribunal.

A Tribunal consists of one person only.

For appointment as the presiding officer of a Tribunal

 he is, or has been, a Judge of a High Court; or

 he has, for a period of not less than 3 years, been a District Judge or an
Additional District Judge;
 he is or has been a Deputy Chief Labour Commissioner (Central) or Joint
Commissioner of the State Labour Department, having a degree in law and at
 7 seven years’ experience in the labour department after having acquired
degree in law including three years of experience as Conciliation Officer:

Provided that no such Deputy Chief Labour Commissioner or Joint Labour

Commissioner shall be appointed unless he resigns from the service of the Central
Government or State Government, as the case may he, before being appointed as
the presiding officer; or he is an officer of Indian Legal Service in Grade III with three
years’ experience in the grade.”

National Tribunal [Sec. 7 (B)]: The Central Government may, by notification in the
Official Gazette, constitute one or more National Industrial Tribunals. Its main
function is the adjudication of industrial disputes which involve questions of national
importance or affecting the interest of two or more States.

According to [Sec 10 (1-A)] dispute involves any question of national importance or

is of such a nature that industrial establishments situated in more than one State,
whether it relates to any matter specified in the Second Schedule or the Third
Schedule, the government will order in writing refer to National Tribunal for
adjudication.

According to [Sec 10 (2)] when parties in the industrial dispute apply to the
government to refer dispute to the National Tribunal and if government satisfies it
shall make the reference to the National Tribunal.

The Central Government shall appoint a National Tribunal consisting of one person
only.

 A person to be appointed a presiding officer of a National Tribunal must be, or

 must have been, a judge of a High Court or
 must have held the office of the chairman or
 any other member of the Labour Appellate Tribunal for a period of not less
than two years.

The Central Government may appoint two persons as assessors to advise the
National Tribunal.

ARBITRATION

Voluntary reference of disputes to arbitration. [sec. 10 (a)]: an arbitrator is

appointed by the Government. Whether the dispute is before Labour Court, or
Industrial Tribunal or National Tribunal, the parties can go to arbitration by written
agreement. The arbitrators conduct the investigation in to the dispute matters and
give arbitration award (final decision or settlement or decree) as for making
reference of an industrial dispute. If an industrial dispute exists or is apprehended
and the employer and the workman agree to refer the dispute to an arbitration, they
may refer the dispute to an arbitration. But such reference shall be made before the
dispute has been referred under Sec. 19 to a Labour Court or Tribunal or National
Tribunal by a written agreement. The arbitrator may be appointed singly or more
than one in number. The arbitrator or arbitrators shall investigate the dispute and
submit to the appropriate Government the arbitration award signed by the arbitrator
or all the arbitrators, as the case may be.

Grievance Settlement Authority [Sec. 9 (c)]: This Section is incorporated as a new

chapter II B of the Act. As per this Section, the employer in relation to every industrial
establishment in which fifty or more workmen are employed or have been employed
on any day in the preceding twelve months, shall provide for, in accordance with the
rules made in that behalf under this Act, a Grievances Settlement Authority.

9C. every industrial establishment employing 20 or more workmen shall have one or
more Grievance Redressal Committee for the resolution of disputes arising out of
individual grievances.

 The Grievance Redressal Committee shall consist of equal number of

members from the employer and the workmen.

 The chairperson of the Grievance Redressal Committee shall be selected

from the employer and from among the workmen alternatively on rotation
basis every year.

 The total number of members of the Grievance Redressal Committee shall

not exceed more than 6: Provided that there shall be, as far as practicable,
one woman member if the Grievance Redressal Committee has two members
and in case the number of members is more than two, the number of women
members may be increased proportionately.

 The Grievance Redressal Committee may complete its proceedings within

forty-five days on receipt of a written application by or on behalf of the
aggrieved party.

 The workman who is aggrieved of the decision of the Grievance Redressal

Committee may prefer an appeal to the employer against the decision of
Grievance Redressal Committee and the employer shall, within one month
from the date of receipt of such appeal, dispose off the same and send a copy
of his decision to the workman concerned.

 Nothing contained in this section shall apply to the workmen for whom there is
an established Grievance Redressal Mechanism in the establishment
concerned.”

AWARDS (decree) [Secs 16, 17, 17A]

 The award of a Labour Court or Tribunal or National Tribunal shall be in

writing and shall be signed by its presiding officer. [Sec 16(2)].

 Every arbitration award and every award of a Labour Court, Tribunal or

National Tribunal shall, within a period of 30 days from the date of its receipt
by the appropriate Government, be published in such manner as the
appropriate Government thinks fit. [Sec 17(1)].
  The award published shall be final and shall not be called in question by any
Court in any manner whatsoever. [Sec 17 (2)].

 An award (including an arbitration award) shall become enforceable on the

expiry of thirty days from the date of its publication [Sec 17A (1)].

 where the award has been given by a National Tribunal, that it will be
inexpedient (not advisable or not practicable) on public grounds affecting
national economy or social justice to give effect to the whole or any part of the
award, the appropriate Government, or as the case may be, the Central
Government may, by notification in the Official Gazette, declare that the
award shall not become enforceable on the expiry of the said period of thirty
days. [Sec 17A (1) (b)].

 The appropriate Government or the Central Government may, within 90 days

from the date of publication of the award under section 17, make an order
rejecting or modifying the award, to legislature of sate or parliament [Sec 17A
(2) ]. And if no pursuance has made, the order become enforceable after the
expiry of 90 days. [Sec 17A (3)].

 Any award as rejected or modified laid before legislature of state or

parliament, shall become enforceable on the expiry of 15 days from the date
on which is so laid. [Sec 17A (3)].

 Award declared becomes enforceable on the specified date if mentioned, if no

date mentioned award becomes enforceable according to above rules.

PERIOD OF OPERATION OF SETTLEMENTS AND AWARDS. [Sec 19]

 A settlement shall come into operation on such date as is agreed upon by the
parties to the dispute, and if no date is agreed upon, on the date on which the
memorandum of the settlement is signed by the parties to the dispute.

 An award shall remain in operation for a period of one year from the date on
which the award becomes enforceable under section 17A: Provided that the
appropriate Government may reduce the said period and fix such period as it
thinks fit :

 the appropriate Government may, before the expiry of the said period, extend
the period of operation by any period not exceeding one year at a time as it
thinks fit, so however, that the total period of operation of any award does not
exceed three years from the date on which it came into operation.

Eg: if the court orders the employer to reinstate the workman in case of
unreasonable removal or discharge , the employer is bind over for one year or in
some cases, the period specified by the courts.
 STRIKES AND LOCKOUTS
Strike [Sec. 2 (q)]: Strike means "a cessation of work by a body of persons
employed in any industry acting in combination or a concerted refusal under a
common understanding of any number of persons who are or have been so
employed, to continue to work or to accept employment". Mere stoppage of work
does not come within the meaning of strike unless it can be shown that such
stoppage of work was a concerted action for the enforcement of an industrial
demand.

Lockout [Sec. 2(1)]: Lockout means "the temporary closing of a place of

employment, or the suspension of work, or the refusal by an employer to continue to
employ any number of persons employed by him". Lockout is the antithesis of strike.

1. It is a weapon of the employer while strike is that of the workers.

2. Just as a strike is a weapon in the hands of the workers for enforcing their
industrial demands, lockout is a weapon available to the employer to force the
employees to see his points of view and to accept his demands.
3. The Industrial Dispute Act does not intend to take away these rights.
4. However, the rights of strikes and lockouts have been restricted to achieve
the purpose of the Act, namely peaceful investigation and settlement of the
industrial disputes.

General Labour Unlon (Red Flag) ... vs B. V. Chavan And Ors on 16

November, 1984

Supreme Court of India expressed

"Imposing and continuing a lockout deemed to be illegal under the Act is an unfair
labour practice."

PROCEDURE OF STRIKES
According to Sec. 22(1) No person employed in a public utility service shall go on
strike in breach of contract-

(a) without giving to the employer notice of strike, as hereinafter provided, within six
weeks before striking; or

(b) within fourteen days of giving such notice; or

(c) before the expiry of the date of strike specified in any such notice as aforesaid;
or

(d) during the pendency of any conciliation proceedings before a conciliation officer
and seven days after the conclusion of such proceedings.

Commentary
Subsection 1 is applicable to the workmen employed in public utility services and
lays down that "no person employed in a public utility service shall go on without
following below said steps

1. Notice of strike (with or without the date of strike) to the employer by the
employees is mandatory.
2. If the date of strike by the employees is not mentioned in the notice such
notice is valid for six weeks only.
3. If the date of strike is mentioned in the notice, the date of strike should not be
before the expiry of 14 days from the date of notice of strike according to the
clause (b).
4. Therefore employees should not go on strike before the expiry of 14 days
from the date of issue of notice of strike to the employer.
5. Notice of strike without the date of strike is valid for six weeks only, if
employees do not go on strike within six weeks, again a fresh notice of strike
by employees is necessary if they want to go on strike.
6. Employees should not go on strike during the pendency of any conciliation
proceedings before a conciliation officer and seven days after the conclusion
of such proceedings.

Significance of "within fourteen days & within six

weeks":
The clauses 'a' and 'b' appearing in sub-section (1) of Section 22 are significantly
incorporated to prohibit the workmen from going on strike without giving a minimum
of 14 days' notice to the employer, a copy of which is also served on the Conciliation
Officer. The purpose is quite obvious. It intends to give some time for the employer
to consider. over the demands of the workers who are now appeared to be more
serious to go on strike in furtherance of their . demand. It also imposes statutory
obligation on the Conciliation Officer to commence conciliation proceedings
immediately so that the strife between the workmen and employer shall not result in
stoppage of work and production.

The sub-section(l) also prohibits the workers from going on strike before the expiry of
the date mentioned in the strike (clause (c)). It necessarily follows that such date can
be fixed after the period of fourteen days during which workers cannot go on strike
(clause b). Now in clause (a) the phrase “within six weeks before striking” is
incorporated to determine the effectiveness of the notice given by the workmen. In
other words the notice of strike given by the workmen in accordance with Section 22
will be effective only for a period of six weeks, after the expiry of which, another fresh
notice would be required. This can be explained more clearly by an example.
Suppose workmen give a notice of strike under Section 22 on 1.1.2001 and fix the
date to go on strike as 20.1.2001. Now they cannot go on strike before 20.1.2001 as
is required under clause c. They cannot fix any date in the notice in this case before
14.1.2001 as they are prevented from going on strike “within 14 days” of giving such
notice by virtue of clause (b). Thus the requirements of both the clauses (b) and (c)
arc complied with. Now suppose workmen do not go on strike on or after 20.1.2001,
the date fixed by them in the notice of strike and kept quite for several months. Then
suddenly they go on strike on any day after several months. This situation would
defeat the very purpose of the I.D. Act to avert stoppage of
work. Therefore to avoid such situation it is laid down in clause (a) that the workmen
cannot go on strike “without giving to the employer notice of strike within six weeks
before striking”. It means that, in this example, the workmen cannot go on strike in
consequence to their notice given on 1.1.2001 after the expiry of six weeks i.e.
15.2.2001, thus the effect of the notice is confined to a period of six weeks requiring
the notice “within six weeks before striking”.

Lastly the workmen cannot go on strike during the period of pendency of any
conciliation proceeding before the Conciliation Officer and seven days after the
conclusion of such proceedings (clause d).

Same conditions are incorporated under sub-section (2) relating to the employers
who, too, cannot declare lockout without following the requirements laid down in
clauses (a) to (d) of sub-section 2.

It must be noted .hat Section 22 of the I.D. Act does not totally prohibit the strike or
lockout, but requires the parties engaged in Public Utility Service to give notice
before resorting to the double-edged weapon of strike or lockout. This was also
clarified by Court in State of Bihar v. Deodhar Jha

Example:

Hi,
We are engineering industry, I am working as Plant HR. since last 2 months
negotiations were going on on wage settlement with workers union. this union is
registered but it is not recognised union as per MRTU & PULP Act. but yesterday all
of sudden the committee members has walked out of meeting and stopped the work
and went out side the gate and started shouting slogans against Management.

Given above scenario, please let me know,

How to handle this strike?
What preventive steps to be taken? and lastly how to break this strike?

Ans)Worker strike is illegal strike you can make notice against Union and submit the
nearest labour office. after that labour officer is inspection on industry and discussed
with management and union leader.

Facts [+]

New Delhi,2012: Air India pilots was called for strike on May 7 and continued till
July 3, is the second longest strike Indian aviation history, has caused loss of Rs.
600 crores to Air India Management. The reasons behind commencement of strike
by Air India pilots were irregularities and non-payment of salaries to pilots by Air
India management. On this reason few pilots were dismissed from the services for
not attending their duties to run flights and for causing loss to the management and
Air India management approached the Delhi High Court requesting it to consider as
illegal strike by pilots. Delhi High Court supported Air India management and
declared it as illegal strike on the grounds of not following the procedure of strike. On
July 4 Delhi High Court gave them 48 hours to join duty and asked the
management to consider their grievances. Pilots on strike have agreed to join duties
and also demanded to reinstate dismissed pilots into the services.

PROCEDURE OF LOCKOUTS
According to Sec. 22(2)

No person employed in a public utility service shall go on Lockout in breach of

contract-

(a) without giving to the employer notice of Lockout, as hereinafter provided, within
six weeks before lockout; or

(b) within fourteen days of giving such notice; or

(c) before the expiry of the date of lockout specified in any such notice as aforesaid;
or

(d) during the pendency of any conciliation proceedings before a conciliation officer
and seven days after the conclusion of such proceedings.

Commentary
Subsection 2 is applicable to the workmen employed in public utility services and
lays down that "no person employed in a public utility service shall go on without
following below said steps

1. Notice of lockout (with or without the date of lockout) to the employees by

their employer is mandatory.
2. If the date of lockout by the employer is not mentioned in the notice, such
notice is valid for six weeks only.
3. If the date of lockout is mentioned in the notice, the date of lockout should not
be before the expiry of 14 days from the date of notice of strike according to
the clause (b).
4. Therefore employers should not go on lockout before the expiry of 14 days
from the date of issue of notice of lockout to the employees.
5. Notice of lockout without the date of lockout is valid for six weeks only, if
employer do not go on lockout within six weeks, a fresh notice of lockout by
employer is necessary, if employer wants to go on lockout.
6. Employers should not go on lockout during the pendency of any conciliation
proceedings before a conciliation officer and seven days after the conclusion
of such proceedings.

Notice of lock-out or strike

According to Sec. 22 (3) the notice of lock-out or strike under this section shall not
be necessary where there is already in existence a strike or, as the case may be,
lock-out in the public utility service.

Prohibits an employer from declaring a lockout in any of the

eventualities mentioned therein [Section 22(2) of the Industrial Disputes Act
1947]

No employer carrying on any public utility service shall lock-out any of his workman

(a) without giving them notice of lock-out as hereinafter provided, within six weeks
before locking-out; or
(b) within fourteen days of giving such notice; or
(c) before the expiry of the date of lock-out specified in any such notice as aforesaid;
or
(d) during the pendency of any conciliation proceedings before a conciliation officer
and seven days after the conclusion of such proceedings.

legal strikes and Lockouts [Section 24 of ID Act 1947]

A strike or a lockout shall be illegal, if employers or worker who ever disobeys or fails
to follow [Sec 22, 23, 10(3), 10-A (4-A)] for commencing strikes or
lockout, those strikes and lockout are said to illegal.

Section
22 Prohibition of strikes and Lockouts (Notice is mandatory in public utility
services)
23 General prohibition of strikes and Lockouts (if said matter is pending
before board, a Labour Court, Tribunal or national tribunal or arbitrator
as mention under Sec 10 & 10A or settlement or about is in operation)
10 Reference of disputes to Boards, courts or Tribunals
10A Voluntary reference of disputes to arbitration

(3) A lock-out declared in consequence of an illegal strike or a strike declared

in consequence of an illegal lock-out shall not be deemed to be illegal.

General prohibition of strikes and lock- outs [Section 23] of

The Industrial Disputes Act, 1947,

General prohibition of strikes and lock- outs.- No workman who is employed in

any industrial establishment shall go on strike in breach of contract and no employer
of any such workman shall declare a lock- out--

(a) during the pendency of conciliation proceedings before a Board and seven
days after the conclusion of such proceedings;
 (b) during the pendency of proceedings before a Labour Court, Tribunal or
National Tribunal] and two months after the conclusion of such proceedings;
(bb) during the pendency of arbitration proceedings before an arbitrator and
two months after the conclusion of such proceedings, where a notification has
been issued under sub- section (3A) of section 10A; or] [10A. Voluntary
reference of disputes to arbitration]
(c) during any period in which a settlement or award is in operation, in respect
of any of the matters covered by the settlement or award.

No notice of strike and lockout is necessary in industrial establishments

except in public utility services.

Strike lockout
Workers shall do the strike. Employer or owner shall do the lockout.
Workers do the strike because of the Owners do the Lockout because of the
grievance and for its solution. disputes between owners and workers.
Prior notice should be given by the Prior notice should be given by the owner
worker to the owner of the factory. of the factory to the worker.

Threat to go on strike:- in State of Bihar v. deodhar Jha (All India Reporter 1958
Patna. 51), the Patna High Court examine the point as to whether or not threat go
on strike is illegal. the court said that the actual resorting to strike cannot always
be illegal, therefore threat to go strike is not illegal.

legal strikes and Lockouts [Section 24 of ID Act 1947]

A strike or a lockout shall be illegal, if employers or worker who ever disobeys or fails
to follow [Sec 22, 23, 10(3), 10-A (4-A)] for commencing strikes or
lockout, those strikes and lockout are said to illegal.

Section
22 Prohibition of strikes and Lockouts (Notice is mandatory in public utility
services)
23 General prohibition of strikes and Lockouts (if said matter is pending
before board, a Labour Court, Tribunal or national tribunal or arbitrator
as mention under Sec 10 & 10A or settlement or about is in operation)
10 Reference of disputes to Boards, courts or Tribunals
10A Voluntary reference of disputes to arbitration

(3) A lock-out declared in consequence of an illegal strike or a strike declared

in consequence of an illegal lock-out shall not be deemed to be illegal.

Penalty for illegal strikes and lock-outs. [Section 26] of the

Industrial Dispute Act 1947.

Penalty for illegal strikes and lock-outs.- (1) Any workman who commences,
continues or otherwise acts in furtherance of, a strike which is illegal under this Act,
shall be punishable with imprisonment for a term which may extend to one month, or
with fine which may extend to fifty rupees, or with both.

(2) Any employer who commences, continues, or otherwise acts in furtherance of a

lock-out which is illegal under this Act, shall be punishable with imprisonment for a
term which may extend to one month, or with fine which may extend to one thousand
rupees, or with both.

Lay-Off And Retrenchment

Chapter V A & V B
Bombay High Court
Veiyra M.A. vs Fernandez C.P. And Anr. on 7 December, 1955
Author: Chagla
Bench: M Chagla, P Dixit
JUDGMENT Chagla, C.J.

In Veiyra v. Fernandez, the Court held that employer has an option for lay-
off or retrenchment.

Lay-Offs
Non-applicability of layoff provisions to certain
establishments
According to section 25A of chapter VA of Industrial Dispute Act 1947, certain
establishments do not have any provisions relating to layoff of the employees by the
employer. In such circumstances, layoff would be considered without any authority of
law.

Such establishments are:

1. Industrial establishments in which less than 50 workmen are employed, on an

average per working day.
2. Industrial establishments which are of a seasonal character and in which work
is performed only intermittently.

Employees employed in the above said establishments do not have right for laid-off
compensation. However if there is any agreement between employer and employee
for that purpose or on the grounds of social justice, laid-off competition can be paid.
In South India Corporation Ltd. v. All Kerala Cashewnut Factory
Workers' Federation the Court held that if any establishment is not covered
within the scope of this Chapter V-A, the Tribunal has no right to grant relief on the
basis of any fanciful notions of social justice.

Except above said industrial establishments, all other industrial establishments ( 50

workmen and above industrial establishments which are not of seasonal character)
have provisions relating to lay off of the employees by the employer.

Right of Compensation by workmen laid-off

[Right of workmen laid-off for compensation] Industrial Disputes Act,1947
Section 25-C
workman has right to lay-off compensation subject to the following conditions, they
are:

1. Workman name should be borne on muster rolls of the establishment and

he/she is not a badli workman or a casual workman; and
2. The workman should have completed not less than one year continuous
service as defined under Section 25-B; and
3. The workman should have laid-off, continuously or intermittently;
4. Then the workman shall be entitled to lay-off compensation for all days during
which he was so laid-off;
5. However, the workman shall not be paid lay-off compensation for such weekly
holidays as may intervene the period of lay-off.
6. The lay-off compensation is equal to 50% of the total of the basic wages and
dearness allowance that would have been payable to him, if he had not been
so laid off.

Explanation: "Badli workman" means a workman who is employed in an industrial

establishment in the place of another workman whose name is borne on the muster
rolls of the establishment, but shall cease to be regarded as such for the purposes of
this. section, if he has completed one year of continuous service in the
establishment.

In Vijay Kumar Mills v. Labour Court, the Madras High Court held that the
badli workman is one whose name is not borne on muster rolls of the establishment.
If his name is found on the muster roll, even if he is a badli workman, he is entitled to
lay-off compensation.

Maximum days allowed to Layoff of employee by

employer
According to section 25C of Industry and dispute Act 1947, maximum days allowed
to Layoff of employee by employer is 45 days, for those days, employee who is laid-
off is entitled for compensation equal to 50% of the total of the basic wages and
dearness allowance that would have been payable to him,had he not been so laid
off.

However, if this contingency is prolonging beyond a reasnable time, say 45 days, it

would be matter of serious concern. both to the employer and to the workmen
because both of them are put to a loss of 50% wages i.e. The employer is required
pay lay-off compensation without extracting work from workmen and workmen too,
would be losing 50% wages which he would have earned had he not been so laid-
off. Therefore the parties can enter into an agreement not to continue lay-off after a
period of 45 days in a year.

Compulsory permission from competent authority by

employer to lay off of workmen
Section 25M of Industrial Dispute act 1947

For Industrial establishments in which not less than 100 workmen are employed, on
an average per working day and are of not being seasonal character and in which
work is performed only intermittently, have to seek prior permission from competent
authority by the employer to layoff workman. if the employer does not apply to seek
prior permission or where such permission is refused by the competent authority
specified above, to effect lay-off, such lay-off shall be considered as illegal and the
workmen laid-off shall be entitled to all benefits as if they have not been laid-off.

Can an employer avoid the lay-off compensation?

Section 25A of Industrial Dispute act 1947

Following establishments can avoid lay off compensation according to the

Section 25E

1. Industrial establishments in which less than 50 workmen are employed, on an

average per working day, but not to industrial establishments in which more
than 100 workmen are employed.
2. Industrial establishments which are of a seasonal character and in which work
is performed only intermittently.

Workmen not entitled to compensation in certain cases [Section

25E] of Industrial Dispute act 1947

(i) if he refuses to accept any alternative employment in the same establishment

from which he has been laid off, or in any other establishment belonging to the same
employer situate in the same town or village or situate within a radius of five miles
from the establishment to which he belongs, if, in the opinion of. the employer, such
alternative employment does not call. for any special skill or previous experience and
can be done by the workman, provided that the wages which would normally have
been paid to the workman are offered for the alternative employment also;
(ii) if he does not present himself for work at the establishment at the appointed time
during normal working hours at least once a day;

(iii) if such laying-off is due to a strike or slowing-down of production on the part of

workmen in another part of the establishment.

Retrenchment
Definition of retrenchment of employee
[Section 2(oo)]
"retrenchments" means the termination by the employer of the service of a workman
for any reason whatsoever, otherwise than as a punishment inflicted by way of
disciplinary action but does not include-

(a) voluntary retirement of the workman; or

(b) retirement of the workman on reaching the age of superannuation if the contract
of employment between the employer and the workman concerned contains a
stipulation in that behalf; or
43[(bb) termination of the service of the workman as a result of the non-renewal of
the contract of employment between the employer and the workman concerned on
its expiry or of such contract being terminated under a stipulation on that behalf
contained therein; or]
(c) termination of the service of a workman on the ground of continued ill-health;]

In Duryodhan Naik v. Union of lndia, the Court held that the discharge of
surplus labour by the employer· for any reason whatsoever, otherwise than as a
punishment inflicted by way of disciplinary action is called retrenchment, but where
the services of all workmen have been terminated by the employer on a real and
bona fide closure of business or the undertaking is taken over by another employer,
it has no application of retrenchment.

In Santosh Gupta v. State Bank of India, a female employee was discharged

on the grounds that she failed to qualify herself in the prescribed test for
confirmation of services. The Tribunal held that the termination does not amount to
retrenchment. But the Supreme Court reversed the decision of the Tribunal and
ordered reinstatement of the employee with full back wages. The Supreme Court
further held that the expression “termination of service for any reason whatsoever” is
wide enough to include every kind of termination of service except those which are
expressly excluded by the proviso to the definition of retrenchment as given in
Section 2(oo)|.

In Tatanagar Foundry Co. v. Their Workmen, it was held that employer

cannot lay-off the workmen with mala fide intention or by way of victimisation.

Procedure for retrenchment [Section 25G]

The principle of 'last come; First go':-
Where any workman in an industrial establishment who is a citizen of India, is to be
retrenched and he belongs to a particular category of workmen in that establishment,
in the absence of any agreement between the employer and the workman in this
behalf, the employer shall ordinarily retrench the workman who was the last
person to be employed in that category, unless for reasons to be recorded the
employer retrenches any other workman.

Re-employment of retrenched workmen [Section 25H]

Where any workmen are retrenched, and the employer proposes to take into his
employ any persons, he shall, in such manner as may be prescribed, give an
opportunity [to the retrenched workmen who are citizens of India to offer themselves
for re-employment, and such retrenched workmen] who offer themselves for re-
employment shall have preference over other persons.

Retrenchment conditions
To an industrial establishment (not being an establishment of a seasonal character
or in which work is performed only intermittently) in which not less than [50 but not
more than 100] workmen were employed on an, average per working day for the
preceding twelve months.[Section 25A]

According to the Section 25F [Conditions precedent to retrenchment of

workmen]

1. Employee should have continuous service for not less than one year under an
employer
2. One month’s notice in writing indicating the reasons for retrenchment or
payment for the period of the notice
3. Compensation which shall be equivalent to fifteen days’ average pay[for every
completed year of continuous service] or any part thereof in excess of six
months.
4. Notice in the prescribed manner is served on the appropriate government

To an industrial establishment (not being an establishment of a seasonal character

or in which work is performed only intermittently) in which not less than [one
hundred] workmen were employed on an, average per working day for the preceding
twelve months.[Section 25K]

According to the Section 25N [Conditions precedent to retrenchment of

workmen]

1. Employee should have continuous service for not less than one year under an
employer
2. Three months notice in writing indicating the reasons for retrenchment or
payment for the period of the notice
 3. Compensation which shall be equivalent to fifteen days’ average pay[for every
completed year of continuous service] or any part thereof in excess of six
months.
4. An application for permission to specified authority for the intended
retrenchment and a copy of such application shall also be served
simultaneously on the workmen concerned in the prescribed manner.
5. Compulsory permission from competent authority by employer retrenchment
of workmen
For Industrial establishments in which not less than 100 workmen are
employed, on an average per working day and are of not being seasonal
character and in which work is performed only intermittently, have to seek
prior permission from competent authority by the employer to layoff workman.

If no application seeking permission to retrench workmen is made by the employer or

where such permission is refused, such retrenchment shall be
deemed to be illegal and the workmen shall be entitled to all benefits as if they
have not been given any notice. (sub-Section 7).

HSBC axes 200 employees from city offices

April 2012, HYDERABAD: HSBC India did a massive layoff exercise showing
the door to as many as 200 employees ranging from assistant manager to vice
presidents from its centres in Hyderabad alone.The axe had fallen on over 350
employees at HSBC's Pune centres. It is estimated that a total of 750
employees were asked to leave across locations and designations. So from
assistant managers to vice presidents were summoned to the meeting room,
asked to choose between termination or resignation, pack their bags and
leave.

An "adequate" compensation (one month's salary for each year spent in the
company plus three months salary) was part of the layoff deal. While the new
entrants into the international bank are crying hoarse, the senior ones are taking
solace in the cash with some having made Rs 8-15 lakh.

Penalty for lay-off and retrenchment without previous

permission [Section5Q ]
This section applies to an industrial establishment (not being an establishment of a
seasonal character or in which work is performed only intermittently) in which not
less than [one hundred] workmen were employed on an, average per working day for
the preceding twelve months.[Section 25K]

 Compulsory permission from competent authority by employer to lay off of

Workmen [Section 25M] of Industrial Dispute act 1947
 Section 25N [Conditions precedent to retrenchment of workmen]
Any employer who contravenes the provisions of section 25M or section 25N shall
be punishable with imprisonment for a term which may extend to one month, or with
fine which may extend to one thousand rupees, or with both.

DURING PENDENCY OF PROCEEDINGS [Sec 33]

During the pendency of any conciliation proceeding before a conciliation officer or a

Board or of any proceeding before an arbitrator or a Labour Court or Tribunal or
National Tribunal in respect of an industrial dispute, employer should not do the
following-

 for any misconduct connected with the dispute, discharge or punish, whether
by dismissal or otherwise, any workmen concerned in such dispute,
 Alter the term of contract according to standing orders.
 Take action against the protected workman.

If employer wants to take above actions against the employee, employer should
makes an application to a conciliation officer, Board, an arbitrator, a Labour Court,
Tribunal or National Tribunal.
UNFAIR LABOUR PRACTICES
FIFTH SCHEDULE

I - On the part of employers and trade unions of employers

1. To interfere with, restrain from, or coerce, workmen in the exercise of their right to
organise, form, join or assist a trade union or to engage in concerted
activities for the purposes of collective bargaining or other mutual aid or
protection, that is to say, -

(a) threatening workmen with discharge or dismissal, if they join a trade union;

(b) threatening a lock-out or closure, if a trade union is organised; and

(c) granting wage increase to workmen at crucial periods of trade union organisation,
with a view to undermining the efforts of the trade union at organisation.

2. To dominate, interfere with or contribute support, financial or otherwise, to any

trade union, that is to say :-

(a) an employer taking an active interest in organising a trade, union of his workmen;
and

(b) an employer showing partiality or granting favour to one of several trade unions
attempting to organise his workmen or to its members, where such a trade union is
not a recognised trade union.

3. To establish employer-sponsored trade unions of workmen.

4. To encourage or discourage membership in any trade union by discriminating
against any workman, that is to say :-

(a) discharging or punishing a workman, because he urged other workmen to join or

organise a trade union;

(b) discharging or dismissing a workman for taking part in any strike (not being a
strike which it deemed to be an illegal strike under this Act);

(c) changing seniority rating of workmen because of trade union activities;

(d) refusing to promote workmen to higher posts on account of their trade union
activities;

(e) giving unmerited promotions to certain workmen with a view to creating discord
amongst other workmen, or to undermine the strength of their trade union;

(f) discharging office bearers or active members of the trade union on account of
their trade union activities.

5. To discharge or dismiss workmen -

(a) by way of victimisation;

(b) not in good faith, but in the colourable exercise of the employer's rights;

(c) by falsely implicating a workman in a criminal case on false evidence or on

concocted evidence;

(d) for patently false reasons;

(e) on untrue or trumpet up allegations of absence without leave;

(f) in utter disregard of the principles of natural justice in the conduct of domestic
enquiry or with undue haste;

(g) for misconduct of a minor or technical character, without having any regard to the
nature of the particular misconduct or the past record of service of the workman,
thereby leading to a disproportionate punishment.

6. To abolish the work of a regular nature being done by workmen, and to give such
work to contractors as a measure of breaking a strike.
7. To transfer a workman mala fide from one place to another, under the guise of
following management policy.
8. To insist upon individual workmen, who are on a legal strike to sign a good
conduct bond, as a precondition to allowing them to resume work.
9. To show favouritis or partiality to one set of workers regardless of merit.
10. To employ workmen as "badlis" casuals or temporaries and to continue them as
such for years, with the object of depriving them of the status and
privileges of permanent workmen.
11. To discharge or discriminate against any workman for filing charges or testifying
against an employer in any enquiry or proceeding relating to any
industrial dispute.
12. To recruit workmen during a strike which is not an illegal strike.
13. Failure to implement award, settlement or agreement.
14. To indulge in acts of force or violence.
15. To refuse to bargain collectively, in good faith with the recognised trade unions.
16. Proposing or continuing a lock-out deemed to be illegal under this Act.

II - On the part of workmen and trade unions of workmen

1. To advise or actively support or instigate any strike deemed to be illegal under this
Act.
2. To coerce workmen in the exercise of their right to self-organisation or to join a
trade union or refrain from joining any trade union, that is to say –
(a) for a trade union or its members to picketing in such a manner that non-striking
workmen are physically debarred from entering the work places;
(b) to indulge in acts of force or violence or to hold out threats of intimidation in
connection with a strike against non-striking workmen or against managerial staff.

3. For a recognised union to refuse to bargain collectively in good faith with the
employer.
4. To indulge in coercive activities against certification of bargaining representative.
5. To stage, encourage or instigate such forms of coercive actions as willful "go
slow", squatting on the work premises after working hours or "gherao" of
any of the members of the managerial or other staff.
6. To stage demonstrations at the residences of the employers or the managerial
staff members.
7. To incite or indulge in willful damage to employer's property connected with the
industry.
8. To indulge in acts of force or violence or to hold out threats of intimidation against
any workman with a view to prevent him from attending work.

Prohibition of unfair labor practice

According to [section 25T]
No employer or workman or a trade union, whether registered under the Trade
Unions Act, 1926 (16 of 1926), or not, shall commit any unfair labor practice.

Penalty for committing unfair labor practices

According to [section 25U]
Any person who commits any unfair labor practice shall be punishable with
imprisonment for a term which may extend to 6 months or with fine which may
extend to Rs.1000/- or with both.

PENALTIES
Sec Reasons Punishment
25U unfair labour practice punishable with imprisonment for a term
which may extend to 6 months or with fine
which may extend to 1000/- rupees or with
both.
26 Illegal Strikes punishable with imprisonment for a term
which may extend to one month, or with
fine which may extend to 50/- rupees, or
with both.
26 Illegal Lock-Outs punishable with imprisonment for a term
which may extend to one month, or with
fine which may extend to one 1000/-
rupees, or with both.
27 Any person who instigates or incites punishable with imprisonment for a term
others to take part in, or otherwise acts which may extend to 6 months, or with fine
in furtherance of, a strike or lock-out which may extend to one 1000/- rupees, or
which is illegal under this Act, with both.
28 Giving Financial Aid To Illegal punishable with imprisonment for a term
Strikes And Lock-Outs which may extend to 6 months, or with fine
which may extend to 1000/- rupees, or with
both.
30 Disclosing Confidential Information Punishable with imprisonment for a term
which may extend to 6 months, or with fine
which may extend to 1000/- rupees, or with
both.
30A Closure of establishment Without punishable with imprisonment for a term
Notice which may extend to 6 months, or with fine
which may extend to 5000/- rupees, or with
both.
31 contravenes the provisions of section Punishable with imprisonment for a term
33 which may extend to 6 months, or with fine
which may extend to 1000/- rupees, or with
both.
The Trade Union Act, 1926
Trade Unions
Trade Union in British English or labor union in American English.

Introduction to Trade Unions

Classification of Trade Unions
Theories of Trade Unionism
Growth of Trade Union Movement
Problems and Measures to Strengthen Trade Union
Employers’ Association
Labor Unions in USA >>

Industrial Relations
Workers participation in Management
(The Constitution of India, Art 43A)
Industrial Disputes
Strikes (Industry)
Lockouts (Industry)
Layoff / Laid off and Retrenchment
Unfair dismissal or wrongful termination of employee
Labour Courts for disputes in India

Objectives:
Trade union is a voluntary organization of workers relating to a specific trade,
industry or a company and formed to help and protect their interests and welfare by
collective action. Trade union are the most suitable organisations for balancing and
improving the relations between the employees and the employer. They are formed
not only to cater to the workers' demand, but also for imparting discipline and
inculcating in them the sense of responsibility.
They aim to:-

 Secure fair wages for workers and improve their opportunities for promotion
and training.
 Safeguard security of tenure and improve their conditions of service.
 Improve working and living conditions of workers.
 Provide them educational, cultural and recreational facilities.
 Facilitate technological advancement by broadening the understanding of the
workers.
 Help them in improving levels of production, productivity, discipline and high
standard of living.
 Promote individual and collective welfare and thus correlate the workers'
interests with that of their industry.
 to take participation in management for decision-making in connection to
workers and to take disciplinary action against the worker who commits in-
disciplinary action.

Well known Central Trade Union Organizations in India:

o All India Trade Union Congress (AITUC)

o Bharatiya Mazdoor Sangh (BMS)
o Centre of Indian Trade Unions (CITU)
o Hind Mazdoor Kisan Panchayat (HMKP)
o Hind Mazdoor Sabha (HMS)
o Indian Federation of Free Trade Unions (IFFTU)
o Indian National Trade Union Congress (INTUC)
o National Front of Indian Trade Unions (NFITU)
o National Labor Organization (NLO)
o Trade Unions Co-ordination Centre (TUCC)
o National Mazdoor Union (NMU)

June 2012: The National Mazdoor Union (NMU) gave a strike notice to
APSRTC ( Andhra Pradesh State Road Transportation
Corporation) Managing Director with nearly 36 demands. In case management
fails to react, union members have decided to strike from following month.

National Mazdoor Union (NMU) said the 36 demands, four were most
important. "Abolition of contract system in APSRTC, regularisation of nearly
22,000 contract drivers and bus conductors, constitution pay commission were
among these.

June 2012: one of the unions of Visakhapatnam steel plant, Indian National Trade
Union Congress (INTUC), has demanded rupees 1 crore ex-gratia ( compensation)
for the families of the victims of the explosion had occurred at the 'oxygen control
unit' near the Steel Melting Shop-II at Visakhapatnam steel plant which claimed the
lives of 20 persons on 12-june-2012. Visakhapatnam steel plant had already paid 20
lakh rupees to each of the families of the deceased workers and officers. The union
also demanded a permanent job for the Kin of the victims. The deceased include
Deputy General Manager (Construction) L Srihari and Deputy General Manager
(instrumentation) P V Karunakar.

Definitions
Appropriate Government [Sec. 2]: In relation to Trade Unions whose objects are
not confined to one state 'the appropriate Government' is the Central Government. In
relation to other Trade Unions, the 'appropriate Government' is the State
Government.

Executive [Sec. 2(a)]: Executive means the body of which the management of the
affairs of a Trade Union is entrusted.

Trade Dispute [Sec. 2(g)]: A trade dispute means any dispute between the
employers and workmen, the workmen and workmen and the employers and
employers which is connected with the employment or non-employment, or the terms
of employment, or the conditions of labour of any person. 'Workmen' mean all
persons employed in trade or industry whether or not in the employment of the
employer with whom the trade dispute arises.

Trade Union [Sec. 2(h)]: Trade Union means 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 employers
and employers for imposing restrictive conditions on the conduct of any trade or
business and includes any federation of two or more Trade Unions.

Provided that this Act shall not affect -

(i) any agreement between partners as to their own business;
(ii) any agreement between an employer and those employed by him as to such
employment; or
(iii) any agreement in consideration of the sale of the goodwill of a business or of
instruction in any profession trade or handicraft.

5. Registered Trade Union [Sec. 2(e)]: A registered Trade Union means a 'Trade
Union' registered under the Act.

[Sec 14] CERTAIN ACTS DO NOT APPLY TO TRADE

UNIONS
Below mentioned acts will not apply to any registered Trade Union, had the
registration of any such Trade Union under any such Act shall be void.

1. The Societies Registration Act, 1860.

 2. The Cooperative Societies Act, 1912.
3. The Companies Act, 1956

Trade Unions can be registered only under the Trade Union Act, 1926.

REGISTRATION OF TRADE UNIONS

[Sec 3] Appointment of Registrars.

 The government will appoint a person to be a Registrar.

 The government will appoint required number of person as the Addition and
deputy Registrar of the Trade Unions. These office will be under the Registrar
of the Trade Union.

[Sec 4] Mode of registration

Minimum Requirement of Registration of Trade Union (2001 amendment)

(1) Any seven or more members of a trade union may, by subscribing their names to
the rules of the trade union and by otherwise complying with the provisions of this
Act with respect to registration, apply for registration of the trade union under this
Act.

Provided that no Trade Union of workmen shall be registered unless at least ten per
cent. or one hundred of the workmen, whichever is less, engaged or employed in the
establishment or industry with which it is connected are the members of such Trade
Union on the date of making of application for registration:

Provided further that no Trade Union of workmen shall be registered unless it has on
the date of making application not less than seven persons as its members, who are
workmen engaged or employed in the establishment or industry with which it is
connected .''.

(2) Where an application has been made under sub-section (1) for the registration of
a trade union, such application shall not be deemed to have become invalid merely
by reason of the fact that, at any time after the date of the application, but before the
registration of the trade union, some of the applicants, but not exceeding half of the
total number of persons who made the application, have ceased to be members of
the trade union or have given notice in writing to the Registrar dissociating
themselves from the application.

Commentary:

 It is understood that for the purpose of registration a minimum of seven

members are necessary to form a trade union. the reason for fixation of
minimum seven members is to encourage formation of more trade unions so
that the trade union would grow.
 under the trade union act 1926, employers can register their trade unions.
[Sec 5] Application for Registration.
Every application for registration of a trade union shall be made to the Registrar and
shall be accompanied by a copy of the rules of the trade union and a statement of
the following particulars, namely-

(a) the names, occupations and addresses of the members making application;
(aa) in the case of a Trade Union of workmen, the names, occupations and
addresses of the place of work of the members of the Trade Union 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 8[office-bearers] of the
trade union.

If Trade Union has already been existing for one year or more, for its registration the
members should submit all the details such as general statement of the assets and
liabilities of the Trade Union going to be registered by the Registrar of Trade Union.

[sec. 6] Provisions to be contained in the rules of a Trade Union (2001

amendment)
For registration of the Trade Union, provision or rules mentioned below should be
followed by the member for registration of the Trade Union according to this act.

a) The name of the Trade Union.

b) The object of the Trade Union.

c) General funds of the Trade Union by its members should be properly used for
Lawful purpose.

d) Maintenances of list of members in the Trade Union and their facilities to be

provided.

e) Half of the members of the trade union must be the member who actually
engaged in an industry with which trade union is connected.

(ee) the payment of a minimum subscription by members of the Trade Union which
shall not be less than—

(i) one rupee per annum for rural workers;

(ii) three rupees per annum for workers in other unorganized sectors; and

(iii) twelve rupees per annum for workers in any other case;

f) Disciplinary action against member of the Trade Union and procedures in

imposition of fines on members.

g) the manner in which the rules shall be amended, varied or rescinded;

h) the manner in which the members of the executive and the other of the Trade
Union shall be elected and removed

(hh) executive members and other office bearers should be elected for the period of
maximum 3 years..

i) Funds of the Trade Union should be safe guarded, annual audit is necessary, and
account books should be maintained for the purpose of inspection if necessary.

j) Procedure how to wind up the Trade Union

Power to call for further particulars and to require alteration of name. [Sec 7]

 If Registrar is not satisfy with information provided by the members of the

Trade Union going to be registered, Registrar is having power to call its
members for submitting the additional and required information for registering
the Trade Union.

 If the Name of the Trade Union is already existed or similar to other Trade
Unions names, registrar is having power to order for changing of the name.

Registration [Sec 8]
All the documents submitted with details and information is correct by the members
of the Trade Union going to be registered, the Registrar will register the Trade
Union.

Certificate of Registration. [Sec 9]

The Registrar registering a Trade Union under Section 8, shall issue a certificate of
registration in the prescribed form which shall be conclusive that the Trade Union
has been duly registered under this Act.
A Supreme Court judgment poses an old question to
India’s labour movement: how to unionise contract
workers.
[Ambit of Sec 9A]

As per the Trade Unions Act, 1926, any workman who works in a factory can join a
union of that factory. But trade unions typically have only permanent workers as
members. The reason cited is that contract workers are not employees of the
employer in question (the manufacturing unit), and so should not find representation
in a union body formed for the purpose of negotiating with the said employer.
Contract workers are hired by the labour contractor, who is empanelled with the
employer as a supplier of contract labour, and who pays their salaries.

But not being on the rolls of an employer does not disqualify a contract worker from
being a member of a factory’s union. Labour law experts point to section 2 (g) of the
Trade Union Act, which defines “workmen”, for the purposes of a trade union, as “all
persons employed in trade or industry whether or not in the employment of the
employer with whom the trade dispute arises”.

This question of who can become a member of a trade union also came up
recently in the case of Chander Bhan, etc versus Sunbeam Autoworkers Union
in the Gurgaon District Court. In a judgment that went largely unnoticed, the
court ruled that any workman employed by a factory — irrespective of whether
he was a permanent worker or not, fulfilled the Industrial Dispute (ID)
Act’s definition of workman or not — was eligible to participate in union
activities.

In the Gurgaon industrial belt, Sunbeam Autoworkers Union is probably the only
union that gives membership to workers with less than 240 days’ service, and it
needed a court intervention to be able to do so. But even it does not offer
membership to contract workers. In fact, no union anywhere gives membership and
voting rights to contract workers. The reasons are many. First, in an industrial
climate extremely hostile to any union activity, workers believe that forming a union
that also includes contract workers is bound to provoke the management into even
greater hostility. Second, managements refuse point blank to discuss with unionists
any issues concerning contract workers. Third, contract workers are far more
insecure compared to regular workers. In an era where companies frequently
terminate even a permanent worker for engaging in union mobilisation, the stakes
are too high for contract workers, who could be summarily dismissed, without any
consequences, by the management.

Fourth, and this is an unpalatable truth for most trade unionists, permanent workers
themselves don’t want to extend union membership to contract workers. In a factory,
say, that employs 300 permanent workers and 1,200 contract workers, any union
that gives voting rights to contract workers would instantly marginalise permanent
workers. Given that permanent workers’ salaries are much higher, economic self-
interest militates against the inclusion of contract workers in union membership.

As a result, India’s contract workers, with the exception of some PSUs in select
sectors such as steel and coal, remain both heavily exploited and largely un-
unionised, with the lack of unionisation and exploitation reinforcing each other.
http://www.thehindu.com/opinion/op-ed/g-sampath-on-sc-rulling-on-contract-workers-getting-equal-pay-on-parallel-
tracks/article9296662.ece#

Minimum requirement about membership of a Trade Union. [Sec 9A]

A registered Trade Union of workmen shall at all times continue to have not less than
10% or 100 of the workmen, whichever is less, subject to a minimum of seven,
engaged or employed in an establishment or industry with which it is connected, as
its members.

Cancellation of registration [sec. 10] (2001 amendment)

Registrar of the Trade Union can cancel the registration of the Trade Union in
following circumstances
 1. When Trade Union registration certificate has been obtained by fraud or other
illegal means.
2. Disobey the rules and regulation of Trade Union act.
3. All the provision contained in section 6 of this act not followed by the
members of the Trade Union.
4. When there are no minimum required numbers of members in the Trade
Union.

Appeal [Sec 11]

 If Registrar of the Trade Union stops registration of the Trade Union or

withdrawal of the registration, members can appeal to Labour Court or an
Industrial Tribunal, with in jurisdiction.

 Court may dismiss the appeal, or pass an order directing the Registrar to
register the Union and to issue a certificate of registration under the provisions
of Section 9 or setting aside the order for withdrawal.

[Sec 13] Features of Registered Trade Union.

 Registered Trade Union will have perpetual succession (will no stop after the
death of the members of the Trade Union.
 Every registered Trade Union will have common seal.
 Every registered Trade Union can acquire and hold both movable and
immovable property.
 Every registered Trade Union can sue others.
 Every registered Trade Union can sued by others also.

RIGHTS AND LIABILITIES OF REGISTERED TRADE

UNIONS
A registered Trade Union has the right to maintain
(a) a general fund, and
(b) a separate fund for political purposes:

But the Unions are bound to utilize the funds only for the purposes specified in the
Act.

OBJECTS ON WHICH GENERAL FUNDS MAY BE

SPENT [Sec. 15]
The following are the purposes for which the general funds of the Union may be
spent:

1. Payment of salaries, allowances, etc., to the office bearers of the Union.

 2. Payment of expenses for the administration of the Union including other
expenses spent on defending any legal proceedings by or against the Union.
3. Settlement of trade disputes.
4. Special allowances to the members (including dependants) of the Trade
Union on account of death, sickness or accidents, etc.
5. Compensation to members for loss arising out of trade disputes.
6. Providing educational, social and religious benefits to the members.
7. Issue of assurance policies on the lives of members and also against
sickness, accidents, unemployment, insurance, etc.
8. Providing for publication of periodicals for the use of which is intended for the
members benefit.
9. Any other object that may be notified by the appropriate Government in the
Official Gazette.

If funds are spent for any purposes other than the above, such expenditure is treated
as unlawful and the Trade Union can be restrained by the Court for applying its funds
in any other purposes.

Construction of separate fund for political purposes [sec. 16]

Apart from the primary objects, a Trade Union may have certain other political
objects. As per Sec. 16 a registered union may constitute a separate fund in addition
to the general fund and the payment of such a fund shall be utilized for serving civic
and political interest of its members. The fund can be utilized for the following
purposes:

 Holding of any meeting or distribution of any literature or document in support

of any candidate for election as a member of legislative body constituted
under the constitution or of any local authority.

 For maintenance of any person who is a member of any legislative body

constituted under the constitution.

 For convening of political meeting of any kind or distribution of political

literature or documents of any kind.

 The registration of electors for selection of a candidate for legislative body.

The funds collected for political purposes shall not be clubbed with the general fund.
No workman is compelled to contribute in this fund and the nonpayment in this fund
cannot be made a condition for admission to the Trade Union.

Immunity from Punishment for Criminal Conspiracy [Sec. 17]:

No office bearer or member of a registered Trade Union will not be punished under
the Sec .120B punishment of criminal conspiracy of the Indian Penal Code
(Conspiracy cases are defined as cases in which two or more persons agree to
commit a crime or to commit an illegal act.) regarding the matters of the spending the
general funds for proper purpose.

Immunity from civil suit to certain cases [Sec 18]:

No suit or other legal proceeding shall be maintainable in any Civil Court against any
registered Trade Union in the following activities and circumstances.

 Delay in the matters relating to the member of the Trade Union regarding the
trade disputes like ‘contract of employment’, (is an agreement between an
employer and an employee which sets out their employment rights,
responsibilities and duties.)

 Trade Union or its members showing interest or interfering in matters of the

trade or business.

 Trade Union or its members showing interest or interfering in matters of the

employment of the persons.

 Trade Union or its members showing interest or interfering in matters of the

removal of labour.

 Trade Union or its members showing interest or interfering in matters of

compensating or remunerating the employees.

 Registered Trade Union shall not be liable in any suit or other legal
proceeding in any Civil Court for the tortious act (wrongful act) committed by
the agent of the Trade Union.

 Registered Trade Union is not liable for the vicarious liability (if agent commits
mistake intentionally without the knowledge of the Trade Union, agent is liable
but not the Trade Union)

Right to inspect books of Trade Union. [Sec 20 ]

The account books of a registered Trade Union and the list of members thereof shall
be open to inspection by office-bearer or member of the Trade Union at such times
as may be provided for in the rules of the Trade Union.

Rights of minors to membership of Trade Unions.[Sec 21]

Any person who has attained the age of 15 years may be a member of a registered
Trade Union and enjoy all the rights of a member.

Disqualifications of office-bearers of Trade Unions. [Sec 21A]

person shall be disqualified for being chosen as, and for being member of the
executive or any other office-bearer of a registered Trade Union if—

 he has not attained the age of 18 years;

 he has been convicted by a Court in India of any offence involving moral

turpitude and sentenced to imprisonment, unless a period of 5 years has
elapsed since his release.

Change of name [Sec 23] - Any registered Trade Union may, with the consent of not
less than 2/3rd of the total number of its members can change its name.
AMALGAMATION OF TRADE UNIONS
[Sec 24] Any 2 or more registered Trade Unions may become amalgamated together
as one Trade Union with or without dissolution or division of the funds of such Trade
Unions or either or any of them, provided that the votes of at least one-half of the
members of each or every such Trade Union entitled to vote are recorded, and that
at least 60% of the votes recorded are in favor of the proposal.

[Sec 25]

 in case of change in the name of the Trade Union, written notice of the
change of name must be signed by secretary and 7 member of the Trade
Union are required to sent to registrar of the Trade Union.

 in case of an amalgamation of the Trade Union, written notice of an

amalgamation must be signed by secretary and 7 member of the Trade Union
are required to sent to registrar of the Trade Union.

 Trade Union name should not match with the other Trade Union names.

 If Registrar satisfies with all requirements provided by the members of Trade

Union, Registrar will change the name and the same entered in the register.

 If Registrar satisfies with all requirements provided by the members of Trade

Unions, Registrar will validate amalgamation and entered in the register.

Dissolution of Trade Union [sec. 27]

 notice of dissolution signed by secretary and 7 member of the Trade Union,

should be sent to the Registrar of the Trade Union within 14 days from the
date of the dissolution of the Trade Union.

 If registrar satisfies with provisions and rules followed by the members of the
Trade Union for dissolution, he will confirm the dissolution.

 Funds shall be divided by the Registrar among its members if there is no rules
mention by the Trade Union in distribution of the funds.

RETURNS TO THE REGISTRAR

Every registered Trade Union shall have to submit annually to the Registrar a
general statement of all receipts and expenditures during the year ended the 31st
day of December. Such a statement shall be accompanied by another statement
containing assets and liabilities of Trade Union as existing on 31st December each
year.