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DR.

SHAKUNTALA MISRA NATIONAL REHABILITATION UNIVERSITY

LUCKNOW

LABOUR LAW

ASSIGNMENT ON: TRADE DISPUTE

(UNDER THE SUPERVISION OF PROF. VIPIN SHAH)

SUBMITTED TO: SUBMITTED BY:

PROF. VIPIN SHAH SOURABH TIWARI

FACULTY OF LAW B.COM.LL.B (HONS.)

. 9TH SEMESTER

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TABLE OF CONTENT

Introduction

Definition of ‘Industrial Dispute’ and ‘Trade Dispute’.

Subject matter of ‘Dispute or Difference’

Ramifications of Industrial Disputes

Conclusion

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INTRODUCTION

The labour problems are associated with industries and the industrialization. When
a single person brings the raw material, works on it, produces the consumer
product like a self employed person (in the modem sense of the term) there would
not arise any labour problem. It is only when a person works for another the
problem arises. Industries need huge capital investment, which cannot be supplied
by labour. So the capitalists invest and establish the industry and look forward for
the labour. The required labour is supplied by the workers in return for a
consideration. Labour in its abstract sense means any physical or mental work
undertaken for a monetary consideration. A worker sells his labour and the
employer purchases the labour. Labour and capital are the necessary and the main
ingredients of an industrial activity. Each can not exist without the other. Both are
interdependent. The co-operation and co-ordination of both are sine-quo-non for
the industrial development.

In the case of any commodity sold in the market the seller fixes the sale price
which is based on material cost, over-head cost, labour cost and includes the taxes
if any and the marginal profit which one aims to earn. But in case of labour price,
the labour cannot be subjected to quantification in terms of money in as much as it
is not easily possible to estimate the quantum of labour one renders in a particular
given period say one hour, which again differs from worker to worker and also
circumstances such the tools used, the facilities afforded, the quality of guidance,
the expertise and the personal intelligence of the worker etc., A person’s labour in
the afternoon hours or late hours may not be the same as that of morning hours
when he was fresh. The speed with which one person regularly performs a job may
again differ from others. Each person’s approach to a particular job again differs.
The intelligence required for the job also differs from person to person. The job
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knowledge often may not be to the same level in all the persons. The sustenance to
hard work differs between persons. The level of obedience to rules sincerity to job,
faithfulness, loyalty towards the employer, the sense of belongingness are some of
the traits which differ from person to person and are independent ofthe industrial
factors and are influenced by factors like sociological, philosophical, religious,
economic, literacy, morality etc.,

For a layman ‘industrial dispute’ is nothing but a difference between the workmen
and their employers, which may relate to the terms of employment as the case may
be. But from the legal point of view it is some thing more not just confined to one
single instance.

Definition of ‘Industrial Dispute’ and ‘Trade Dispute’.

The Trade Unions Act, 1926 and the Industrial Disputes Act, 1947 defined the
terms ‘trade dispute’ and the ‘industrial dispute’. Though the nomenclatures
slightly differ, the ultimate object and the substance of both the definitions are one
and same.

The statutory object of formation of a trade union is to regulate the relations


between workmen and workmen or between employers and employers or between
workmen and employers or to impose restrictive condition on conduct oftrade or
business. The trade unions for this purpose when registered under the Trade
Unions Act, 1926 have been given certain rights, immunities and also are subject
to certain liabilities/duties. The rights and immunities can be enjoyed by a trade
union only for the acts done in contemplation or furtherance of a ‘trade dispute’.
The Industrial Disputes Act, 1947 provides the machinery to investigate and

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resolve the ‘industrial disputes’. Hence both the Trade Unions Act, 1926 and the
Industrial Disputes Act, 1947 are complimentary to each other with the sole object
to maintain the industrial peace and harmony, which is essential for the economic
and industrial growth of the country. This highly laudable object can be achieved
only when the industries are free from conflicts.

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Definition of ‘Trade Dispute’ under the Trade Unions Act, 1926

The Trade Unions Act, 1926 has christened the “industrial dispute” as “trade
dispute” and defines as under: ‘Trade Dispute ’ means “any dispute between
employers and workmen or between workmen and workmen or between employers
and employers which is connected with employment or non-employment or the
terms of employment or the conditions of labour of any person and ‘workmen’
means all persons employed in trade or industry whether or not in the employment
ofthe employer with whom the trade dispute arises.

Subject matter of ‘Dispute or Difference’

The ‘dispute’ or ‘difference’ according to Section 2 (g) ofthe Trade Unions Act,
1926 and Section 2(k) ofthe Industrial Disputes Act, 1947 must be connected with
employment or non-employment or the terms of employment or with the
conditions of labour of any person.

(a) A dispute regarding reinstatement of dismissed workmen

A ‘dispute’ regarding reinstatement of a workman, who has been dismissed, is


covered by the expression dispute connected with the non-employment of ‘any
person’ used in the definition of ‘industrial dispute’ in Section 2(k) of the
Industrial Disputes Act, 1947. The Delhi High Court in Fedders Lloyd Corporation
Ltd. V .Lt .Governor Delhi49 held that non employment includes retrenchment as
well as refusal to reinstate.

(b) Dispute relating to Workmen employed by the Contractor

The Supreme Court in Standard Vacuum Refining Company ofIndia Ltd vs. Their
workmen & another50, dealt on the question of a dispute raised by the permanent
workmen relating to abolition of contract labour system and their regularization.

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The Standard Vacuum Refining Company of India Ltd. was regularly giving
annual contract for the maintenance of the plant and premises. 67 persons were
employed in 1970 and in the next year, the number 67 were brought down to only
40. Threatened by the insecurity ofjob, the workmen raised a ‘dispute’ demanding
abolition of contract labour system. The Court held that, the dispute to be an
industrial dispute on the reason that there was a real and substantial interest
involved between the company and the workmen on the question of employment
of contract labour for the work of the company. The fact that the workmen were
employed by contractor would not alter the nature of the ‘dispute’ so long as the
party raising the ‘dispute’ has a direct interest in the subject matter ofthe ‘dispute’.

The expression ‘terms of employment’ would ordinarily include not only the
contractual terms and conditions but those terms which are understood and applied
by the parties in practice or habitually or by common consent without ever being
incorporated in the contract of employment.

(c) Dispute relating to privileges or concessions

The privileges and concessions granted by the employer to the workmen or a trade
union of workmen would not be a matter pertaining to conditions of service. The
Madras High Court in Workmen ofIndian Bank vs. Management ofIndian Bank
held that where privilege given to an office bearer of a trade union in the form of
duty relief is withdrawn by the management which has granted the privilege, it
cannot be said that an ‘industrial dispute’ has arisen there by. The legal status ofthe
duty relief is only that of a concession and not a matter pertaining to conditions of
service. Where the concession provided is withdrawn, the beneficiary cannot
complain that a condition of service is affected. However, one should go to the
genesis of the privilege or the concession. If the privilege or the concession in

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question is granted by the employer as a matter of good will gesture with the main
object to keep the workmen satisfied and on his (employer’s) own then withdrawal
of such a privilege or concession would not give rise to an industrial dispute. On
the hand if the privilege or the concession has been granted or enjoyed by the
workmen pursuant to the conditions of service then any withdrawal or alteration to
the disadvantage or detriment ofthe workmen would definitely come within the
purview ofthe definition ‘industrial dispute’.

(d) Disputes relating to the Contractual Relationship

In Management of Safdar Jung Hospital, New Delhi vs. Kuldip Singh53 the
Supreme Court held that to bring in to existence an ‘industrial dispute’ the parties
to the ‘dispute’ must have contractual relationship with the employer following
trade, business or manufacture and the workmen following any calling, service or
employment in aid of employer’s enterprise. To raise an industrial dispute it must
first be established that there exists the relationship of employer and employee
associating together, the former following a trade or business, etc,. However, it is
not necessary that there must be a profit motive. But the enterprise must be
analogous to trade or business in a commercial sense. The ‘dispute’ must relate to
the existing industry and not a dead one or one which is proposed or not even in
existence.

(e) Disputes relating to Ideology or of Religious Nature

Disputes relating to ideology not being materialistic in nature or pertaining to


religion or philosophical issues are not ‘industrial disputes’ even though raised by
majority ofthe workmen or a trade union, for the reason that they are not connected
with employment or non-employment or terms of employment or conditions of
service.

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Ramifications of Industrial Disputes

Albeit no one like any industrial dispute to exist or continue on the industrial front
disturbing industrial peace and harmony, but still some time industrial conflicts
surface and continue for quit a long period unresolved jeopardizing the industrial
production. The capital employs labour, labour serves for capital, and it is the
society which employs both capital and the labour. Hence in this perspective
society also suffers from industrial unrest. The impact of the existence of the
industrial disputes has far reaching consequences. The industrial disputes affect the
economic, social and political life of a country in any given situation. They retard
the industrial growth of a country. Industrial disputes results in loss of production
days and precious man days for ever. Employers as well as the labour suffer from
industrial conflicts this leads to suffering of the society at large. Sometimes
industrial unrest also leads to law and order problems thus putting the society in
vulnerable position.

Causes of Industrial Disputes

Capital employs labour and labour contributes to the Capital. So out of necessity
each one is depending upon the other. The interest of each one is again
diametrically opposite in as much as labour always strives to get more wages and
facilities from the industry, where as the employer tries to cut down the wage bill
as much as possible to inflate his profit. Some times even the market forces which
depend on the principle of demand and supply also work on both the employers
and the labour class. The causes for industrial disputes are many. However, they
may be grouped in to three categories i.e. Employment oriented, Administration
oriented, Society/ Government oriented and miscellaneous causes.

Employment oriented causes of industrial disputes

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The factors relating to employment, non-employment, conditions of service and
terms of employment come under this category of causes. The loss of value of
money resulting from galloping prices of essential commodities, the availability of
huge number of unemployed youth force, the cut-throat competition among the
industrialist, the better awareness among the working class resulting from rise in
educational levels, the ever rise in the aspirations and the expectations of the
common man, the rise in the standards of living in the society compelling the
workers also to live with that standard, the growth oftrade unionism are coming
with in this category.

Administration centered causes of industrial disputes

Such disputes which arise due to un- reasonable, arbitrary, high handedness of the
employer or their representatives many a time disturbs industrial peace.
Unwillingness ofthe administration ofthe industry to talk to the labour trade union
representatives leads to the birth of rather more serious industrial problems than
what the administration had tried to avoid by not willing to speak to the labour.
The capricious attitudes of the representatives of the employers often result in
industrial conflicts, disturbing industrial peace. Mostly such causes arise due to
lack of appreciation ofthe importance ofthe contribution of the labour by the
employer’s representatives. It may also be due to lack of recognition oflabour as
one ofthe most essential resources necessary for the very existence ofthe industry.

Society/Government centered causes of industrial disputes

The changes in the society, surrounding and the neighbouring industries also bring
in to existence industrial disputes. The policy of the Government especially
relating to Globalization, Privatization and Liberalization seriously affects the
interests ofthe working class.

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The ineffectiveness of some of the labour laws or their ineffective and
unsatisfactory way of implementation and their loss ofrelevance to the changed
industrial scenario leads to industrial conflicts by the workers trying to influence
the Government to bring in favourable legislations. There is another area where the
Government is again responsible for existence of industrial disputes that is the
inadequate dispute resolving Government agencies

Other causes of industrial disputes

The growth oftrade unionism also brought along with it certain amount of negative
aspect which is affecting the industrial peace. The Trade Unions Act, 1926 also
provides impetus by failing to check the indiscriminate growth oftrade unions.
There is no Central legislation till today which can provide for compulsory
recognition of the trade unions for the purpose of collective bargaining as a
collective bargaining agent. Every attempt made by the legislature in the context
remained a futile exercise. All these factors gave rise to inter and intra union
rivalry which many a time ends up with aggressive trade union activities to show
one up-man-ship. Depending upon the political development in the country the
political parties also use the affiliated trade unions to engineer industrial disputes
to create industrial unrest solely for political purposes.

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CONCLUSION

The quantification of labour in terms of money with accuracy and standardization


is not possible. In the quest to earn more profit the employer always naturally tries
to purchase labour at as much low price as possible.

There is an inherent conflict in both the interest of capital and the labour. Both are
diagonally opposite. The political philosophy prevailing in the society also makes
an impact on labour problems. Democratic philosophy leads men to expect the
society to treat them politically equal and also access to equal economic
opportunities. Besides the wages certain psychological issues like pride of job, self
satisfaction, sense of importance, better working atmosphere, better health
facilities, educational and recreational facilities etc. taken important place in labour
expectations.

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