A DISSERTATION

ON
VOLUNTARY SETTLEMENT OF INDUSTRIAL
DISPUTE

SUBMITTED TO M.S. LAW COLLEGE

(UTKAL UNIVERSITY)
FOR PARTIAL FULFILMENT OF REQUIREMENTS OF 9TH SEMESTER, 5
YEAR INTEGRATED B.A.LL.B (HONS.) CBCS EXAMINATION-2018

SUBMITTED BY
MS. SONALI SINGH
UNIVERSITY ROLL NO. 90206CT14047
UNIVERSITY REGD. NO. 3403/14

MADHUSUDAN LAW COLLEGE

(UTKAL UNIVERSITY)
CUTTACK, ODISHA
 ACKNOWLEDGEMENT

I have taken efforts in this project. However, it would not have been
possible without the kind support and help of many individuals. I would
like to extend my sincere thanks to all of them.
I am highly indebted to Dr. Sukant Kumar Nanda Sir and Dr. Soumitra
Kumar Chatterjee Sir for their guidance and constant supervision as
well as for providing necessary information regarding the project & also
for their support in completing the project.
I would like to express my gratitude towards my parents for their kind
co-operation and encouragement which help me in completion of this
project.
My thanks and appreciations also go to my friends in developing the
project and people who have willingly helped me out with their
abilities.

SONALI SINGH
BA.LLB. (HONS) 9TH SEMESTER
 CONTENTS

 Introduction
 Definition of Industrial Disputes
 Causes of Industrial Disputes
a. Wage Demands
b. Union Rivalry
c. Political Interference
d. Unfair Labour practices
 Dispute Settlement Methods and Machinery
a. Works Committee
b. Arbitration
c. Conciliation
 Procedure and Powers of Conciliation Officer, Boards and Courts
 Conciliation and Adjudication
 Voluntary Arbitration
 Voluntary Arbitration
 Conclusion
 References
 INTRODUCTION:

Disputes are characteristic of society and more so in an industrial society.

Disputes refers to a disagreement or argument between two people,
groups or countries. The industrial disputes are, therefore, the disputes
that arise between an employer or an employers’ organization on one
side and the workmen or trade unions of workmen on the other, on
matters relating to employer-employee relationship, i.e., on the
formulation and enforcement of standards of wages and other
conditions of employment.

The divergence of interests between labour and capital is at the root of

the industrial or labour disputes. Analyzing how the conflicts between
employers and workmen led to organization on both sides, Kahn Freund
observed:

“Thus on the employers as well as on workers’ side the formation of

organized groups may be the outcome of the conflict itself. In
labour management relations conflict is very much father of all
things.”

The definition of ‘Industrial Dispute’ under the Industrial Dispute Act,

1947 – Section 2 (k) defined “industrial dispute” in the following words:
 “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
employment or non-employment or the terms of employment or
with the conditions of labour of any person”

The definition postulates that, first, the dispute should relate to an

“industry” as defined in Section 2 (j); secondly, there should be a
dispute or difference as a matter of fact; thirdly, the dispute should be
between the parties specified and lastly, the dispute should be
connected with matters, which bear upon the relationship of employers
and workmen.
 DEFINITION OF INDUSTRIAL DISPUTES:

In capitalist and mixed economy, industrial disputes are very much

common. Industrial disputes are the result of conflicts between
employers and workers. While the employers are always trying to resist
increase in wages and also try to increase the hours of work but the
workers or employees are organising themselves through trade union for
raising their wages along with betterment of other conditions of work.

In order to achieve their goal, workers are following the path of protests
by resorting to gherao, go-slow, demonstrations, strikes etc. and the
employers in order to enforce discipline and to safeguard their interest
may go for retrenchment and dismissal of employees and in the extreme
case may declare a lock-out.

Thus both the strikes and lock-outs are the two extreme measures
followed by employees and employers respectively in extreme cases.
Thus these sorts of conflicts between the employer and employees are
known as industrial disputes. The industrial disputes result in huge loss
of mandays as well as production.

The industrial relations are disturbed by industrial disputes and growing

industrial disputes may pollute the entire industrial climate of the
country leading to a total chaos in the economy.
 CAUSES OF INDUSTRIAL DISPUTES

The causes of industrial disputes are many and varied. The major ones
related to wages, union rivalry, political interference, unfair labour
practices, multiplicity of labour laws, economic slowdown and others.

Wage Demands

By far, the most important cause for disputes is related to wages. The
demand for wages has never been fully met because of inflation and high
cost of living. High inflation results in increased cost of living resulting in
never-ending demands from unions.

Management and Unions have wage agreement generally valid for three
years. Each new agreement is preceded by a prolonged battle between
managements and unions, often resulting in strikes and lockouts.
Agreement reached in one company will inspire unions in other plants in
the locality, and make them pitch tents demanding similar rise in wages.
Closely related to wages are bonus, incentives, and other allowances. Of
all these, wages have been a major issue of contention that leads to
disputes.

Union Rivalry
Multiplicity of unions leads to inter-union rivalries. If one union agrees
to a wage settlement, another union will oppose it. The consequence is
never-ending disputes, as has been happening at the Singareni Collieries.
The company had 445 strikes in 1990-91 resulting in a loss of production
of 3.12 million tonnes and 34.19 lakh man-days. The reason is mainly
union rivalry. One union or the other is always on strike and often the
demands of rival unions on an issue are conflicting.

Multiplicity of unions poses peculiar problems to managers. One such

problem relates to authenticity of memberships. Unions put up
respective numbers of members in such a way that when added together
the figure exceeds the total number of workers in the organisation.
Another problem relates to the selection of a bargaining agent in the
process of collective bargaining. Union rivalry leads to large-scale
violence.

Political Interference

Major trade unions are affiliated to political parties. Political affiliation is

not peculiar to our country alone. Even a cursory assessment of labour
movements around the world would show that trade unions are, by their
very nature, political, and that politicisation of labour is the rule rather
than the exception.
What happens when unions get politicised? In the first place, distant
ideological issues divide and fragment unions on party lines. When
unions multiply, inter-union rivalry erupts and the consequences are too
obvious. Second, inspired by their political ideologies, certain unions
refuse to sign an agreement even if it is favourable to all the workers and
thus these perpetual dissenters manage to keep the issue alive.

Third, every political party somehow engineers strikes to demonstrate

its political strength. Invariably, the political party which is in power
favours a union which is affiliated to it, and the result is end less disputes.

Unfair Labour Practices

Majority of disputes are management inspired. The following points 2

justify the assertion:

1. The management is generally not willing to talk over any disputes with
the employees or the representatives, or refer it to ‘arbitration’ even
when trade unions want it so, and this enrages the workers.

2. A management’s unwillingness to recognise a particular trade union

and the dilatory tactics to which it resorts while verifying the
representative character of any trade union have been a source of
industrial strife.
Multiplicity of Labour Laws

Labour laws in our country, as in several other countries, have been

enacted to create conditions for the protection of labour from unfair
employment practices and to provide a legal framework within which
Industrial Relations is to be regulated.

Labour legislation is regarded as the most dynamic institution. From a

simple restraint on child labour in 1881, labour legislation in our country
has become an important agency of the State for the regulation of
working and living conditions of workers, as indicated by the rising
number and variety of labour acts. This rapid development of labour
legislation is an integral part of the modern social organisation.

There are more than 155 Acts, both Central and State, earning our
country the dubious distinction of being one of the few highly labour
legislated countries in the world. What has been the outcome of all
these? Surely, the result has been endless confusion, industrial strife,
loss of production and exploitation of labour by the management and of
the management by the labour.

What is strange is that in developed countries of the Western world,

labour legislation followed the emergence of industrialisation and in
response to a demand for economic and social betterment of the
workers. We neither experienced an industrial revolution. in the true
sense of the tenn, leading to the gradual emergence of a welfare state.
nor a socialist revolution which binds the public sector with a sense of
performance.
 DISPUTE SETTLEMENT METHODS AND
MACHINERIES

It is already noted that that disputes between employers and workmen

are a common phenomenon in an industrial society. For Voluntary
Settlement of these disputes industrial Dispute Act, 1947 provides three
mechanisms.

These are:

1. Works Committee
2. Arbitration
3. Conciliation

1. Works Committees

To facilitate bilateral negotiations or joint consultation on all matters of

common concern, Sec.3 of the I.D. Act provides for the constitution of
works committees, consisting of representative of employer and
workmen in equal numbers.

As per this provision, the appropriate Government may by general or

special order require an employer of an industrial establishment in which
one hundred or more workmen are employed, or have been employed
on any day in the preceding twelve months, to constitute a Works
Committee. The representatives of the workmen shall be chosen, in
consultation with their trade unions, if any, registered under the Trade
Unions Act, 1926.

Section 3 (2) lays down: “It shall be the duty of works committee to
promote measures for securing and preserving amity and good relations
between the employer and workmen and, to that end, to comment upon
matters of their common interests or concern and endeavour to
compose any material difference of opinion in respect of such matters.”

Scope and Powers of Works Committee

The scope of its powers are confined to only two things:

I. to comment upon the matters of common interest and

II. to endeavour to compose any material difference of opinion

The Supreme Court in Northbrook Jute Co. Ltd. v. Their Workmen (1960)
pronouncing on the powers of the Works Committee, observed:

“The languages used by the legislature makes it clear that the Works
Committee was not intended to supplant or supersede the unions for the
purpose of collective bargaining; they are not authorized to consider real
or substantive changes in the conditions of service; their task is only to
smooth away friction that might arise between the workmen and
management in day to day work”.

Therefore, the Works committees are only deliberating bodies or at best

recommendatory bodies, but not decision-making bodies.

Kennedy, in his criticism on the ideology of constituting works

Committees over and above the collective bargaining relationship,
considered them as “artificial creation of bodies to perform theoretical
function.

A veteran trade union leader Sri G. Ramanujam once commented on the

Works committees as follows:

“Works committees are rarely constituted; where they are constituted

they rarely meet; when they meet they rarely take decisions; even when
they take decisions, they are rarely implemented.”

Conciliation or Mediation

Conciliation or Mediation are procedures whereby a third party provides

assistance to the parties in the course of negotiations, or when
negotiations have reached an impasse with a view to helping them to
reach an agreement.
Conciliation as a method of settlement of industrial disputes is widely
prevalent in almost all countries. The utility of conciliation as a dispute
settlement technique, not only in labour relations but also in
international and other domestic relations is well recognized. The recent
thrust on Lok Adalats in India manifests its effectiveness as a conflict
adjustment technique.

Elucidating the two different objectives of conciliation in labour

relations, the ILO publication on Conciliation and Arbitration observed:

For many years the settlement of disputes without or with a minimum of

strikes and lock outs was the first and the only recognized objective of
conciliation and arbitration, and this still seems to be largely the position
in certain countries; however, especially where voluntary procedures are
the only prevailing methods of settlement, it is also the aim of
conciliation and arbitration to foster the growth of collective bargaining.

Conciliation machinery under Industrial Dispute Act ->

The Industrial Dispute Act contemplates three types of machinery for

performing the function of conciliatioin.

a. Conciliation Officer
b. Boards of Conciliation
c. Court of Enquiry
A. Conciliation Officer

Section 4 of the Industrial Dispute Act, 1947 empowers the appropriate

Government i.e. the Central Government and the State Governments to
appoint conciliation officers charged with the duty of mediating in and
promoting settlement of industrial disputes.

The Industrial Disputes Act, 1947 provides for conciliation, and can be
utilised either by appointing conciliation officers (permanently or for a
limited period) or by constituting a board of conciliation. This conciliation
machinery can take a note of a dispute or apprehend dispute either on
its own or when approached by either party.

With a view to expediting conciliation proceeding, time-limits have been

prescribed—14 days in the case of conciliation officers and two months
in the case of a board of conciliation, settlement arrived at in the course
of conciliation is binding for such period as may be agreed upon between
the parties or for a period of 6 months and with continue to be binding
until revoked by either party. The Act prohibits strike and lock-out during
the pendency of conciliation proceedings before a Board and for seven
days after the conclusion of such proceedings.

The Conciliation Officer is given the powers of a civil court, whereby he

is authorised to call the witness the parties on oath. It should be
remembered, however, whereas civil court cannot go beyond
interpreting the laws, the conciliation officer can go behind the facts and
make judgment which will be binding upon the parties.

On receiving information about a dispute, the conciliation officer should

give formal intimation in writing to the parties concerned of his intention
to commence conciliation proceedings from a specified date. He should
then start doing all such things as he thinks fit for the purpose of
persuading the parties to come to fair and amicable settlement of the
dispute.

Conciliation is an art where the skill, tact, imagination and even personal
influence of the conciliation officer affect his success. The Industrial
Disputes Act, therefore, does not prescribe any procedure to the
followed by him.

The conciliation officer is required to submit his report to the

appropriate government along with the copy of the settlement arrived
at in relation to the dispute or in case conciliation has failed, he has to
send a detailed report giving out the reasons for failure of conciliation.

The report in either case must be submitted within 14 days of the

commencement of conciliation proceedings or earlier. But the time for
submission of the report may be extended by an agreement in writing of
all the parties to the dispute subject to the approval of the conciliation
officer.

If an agreement is reached (called the memorandum of settlement), it

remains binding for such period as is agreed upon by the parties, and if
no such period is agreed upon, for a period of six months from the date
on which the memorandum of settlement is signed by the parties to the
dispute, and continues to be binding on the parties after the expiry of
the period aforesaid, until the expiry of two months from the date on
which a notice in writing of an intention to terminate the settlement is
given by one of the party or parties to the settlement.

B. Board of Conciliation:

When a Conciliation Officer fails to resolve the differences between the

parties, the government has the discretion to appoint a Board of
Conciliation.

Section 5 of the Industrial Dispute Act, 1947 states that:

(1) The appropriate government may as occasion arises by notification in

the Official Gazette constitute a Board of Conciliation for promoting the
settlement of an industrial dispute.
(2) A Board shall consist of a Chairman and two or four other members,
as the appropriate government thinks fit.

(3) The Chairman shall be an independent person and the other

members shall be persons appointed in equal numbers to represent the
parties to the dispute and any person appointed to represent a party
shall be appointed on the recommendation of that party:

PROVIDED that, if any party fails to make a recommendation as aforesaid

within the prescribed time, the appropriate government shall appoint
such persons as it thinks fit to represent that party.

(4) A Board, having the prescribed quorum, may act notwithstanding the
absence of the Chairman or any of its members or any vacancy in its
number:

PROVIDED that, if the appropriate government notifies the Board that

the services of the Chairman or of any other member have ceased to be
available, the Board shall not act until a new Chairman or member, as
the case may be, has been appointed.

The machinery of the Board is set in motion when a dispute is referred

to it. In other words, the Board does not hold the conciliation
proceedings of its own accord. 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 a fair and amicable
settlement. The Board must submit its report to the government within
two months of the date on which the dispute was referred to it. This
period can be further extended by the government by two months.

C. Court of Inquiry:

In case of the failure of the conciliation proceedings to settle a dispute,

the government can appoint a Court of Inquiry to enquire into any
matter connected with or relevant to industrial dispute.

Section 6 of the Industrial Dispute Act, 1947 states that:

(1) The appropriate government may, as occasion arises by notification

in the Official Gazette, constitute a Court of Inquiry for inquiring into any
matter appearing to be connected with or relevant to an industrial
dispute.

(2) A court may consist of one independent person or of such number of

independent persons as the appropriate government may think fit and
where a court consists of two or more members, one of them shall be
appointed as the Chairman.
(3) A court, having the prescribed quorum, may act not with standing the
absence of the Chairman or any of its members or any vacancy in its
number:

PROVIDED that, if the appropriate government notifies the court that the
services of the Chairman have ceased to be available, the court shall not
act until a new Chairman has been appointed.

The court of enquiry is required to submit its report within a period of six
months from the commencement of enquiry. This report is subsequently
published by the government within 30 days of its receipt. Unlike during
the period of conciliation, workers’ right to strike, employers’ right to
lockout, and employers’ right to dismiss workmen, etc. remain
unaffected during the proceedings in a court to enquiry.

A court of enquiry is different from a Board of Conciliation. The former

aims at inquiring into and revealing the causes of an industrial dispute.
On the other hand, the latter’s basic objective is to promote the
settlement of an industrial dispute. Thus, a court of enquiry is primarily
fact-finding machinery.

Procedure and Powers of Conciliation Officer, Boards of

Conciliation and Courts of Inquiry
Section 11 of the Industrial Dispute Act describes the procedure and
powers of conciliation officer, boards and court of enquiry.

They are as follows:

(1) A board shall follow such procedure as the arbitrator or other

authority concerned may think fit.

(2) A conciliation officer or a member of a board or court or the presiding

officer of a Labor Court, Tribunal or National Tribunal] may for the
purpose of inquiry into any existing or apprehended industrial dispute,
after giving reasonable notice, enter the premises occupied by any
establishment to which the dispute relates.

(3) Every Board, court, [Labor Court, Tribunal and National Tribunal] shall
have the same powers as are vested in a Civil Court under the Code of
Civil Procedure,1908 (5 or 1908), when trying a suit, in respect of the
following matters, namely:-

(a) enforcing the attendance of any person and examining him on

oath;
(b) compelling the production of documents and material objects;
(c) issuing commissions for the examination of witnesses;
(d) in respect of such other matters as may be prescribed, and
every inquiry or investigation by a Board, court, [Labor Court,
 Tribunal or National Tribunal, shall be deemed to be a judicial
proceeding within he meaning of sections 193 and 228 of the
Indian Penal Code (45 to 1860).

(4) A conciliation officer [may enforce the attendance of any person for
the purpose of examination of such person or call for] and inspect any
document which he has ground for considering to be relevant to the
industrial dispute 78[or to be necessary for the purpose of verifying the
implementation of any award or carrying out any other duty imposed
on him under this Act, and for the aforesaid purposes, the conciliation
officer shall have the same powers as are vested in a civil court under
the Code of Civil Procedure, 1908.

(5) All conciliation officers, members of a Board or court and the

presiding officers of a Labor Court, Tribunal or National Tribunal shall
be deemed to be public servants within the meaning of section 21 of
the Indian Penal Code

Duties of Conciliation Officer

Section 12 of the Industrial Dispute Act describes about duties of

conciliation officers and they are as follows:

(1) Where any industrial dispute exists or is apprehended, the

conciliation officer may, or where the dispute relates to a public utility
service and a notice under section 22 has been given, shall, hold
conciliation proceedings in the prescribed manner.

(2) The conciliation officer shall, for the purpose of bringing about a
settlement of the dispute, without delay, investigate the dispute and all
matters affecting the merits and the right settlement thereof and may
do all such things as he thinks fit for the purpose of inducing the parties
to come to a fair and amicable settlement of the dispute.

(3) If a settlement of the dispute or of any of the matters in dispute is

arrived at in the course of the conciliation proceedings the conciliation
officer shall send a report thereof to the appropriate government [or an
officer authorized in this behalf by the appropriate government]
together with a memorandum of the settlement signed by the parties to
the dispute.

(4) If no such settlement is arrived at, the conciliation officer shall, as

soon as practicable after the close of the investigation, send to the
appropriate Government a full report setting forth the steps taken by
him for ascertaining the facts and circumstances relating to the dispute
and for bringing about a settlement thereof, together with a full
statement of such facts and circumstances, and the reasons on account
of which, in his opinion, a settlement could not be arrived at.
(5) If, on a consideration of the report referred to in sub-section (4), the
appropriate government is satisfied that there is a case for reference to
a Board, [Labor Court, Tribunal or National Tribunal], it may make such
reference. Where the appropriate government does not make such a
reference it shall record and communicate to the parties concerned its
reasons therefor.

(6) A report under this section shall be submitted within fourteen days
of the commencement of the conciliation proceedings or within such
shorter period as may be fixed by the appropriate government:

PROVIDED that, subject to the approval of the conciliation officer, the

time for the submission of the report may be extended by such period as
may be agreed upon in writing by all the parties to the dispute.

In the case of Sukhbir Singh vs Union Of India (1994) it was held that the
government acting under the Section 10 and Section 12(5) as the act has
no power to decide the merits of the controversy. In this case, it is also
decided that Government can only determine whether dispute exists. It
has no power to adjudicate the dispute.
Duties of Courts of Inquiry

Section 14 of the Industrial Dispute Act states that “A court shall inquire
into the matters referred to it and report thereon to the appropriate
government ordinarily within a period of six months from the
commencement of its inquiry.”

Duties of Boards of Conciliation

Section 13 of the Industrial Dispute Act states that:

(1) Where a dispute has been referred to a Board under this Act, it shall
be the duty of the Board to endeavor to bring about a settlement of the
same and for this purpose the Board shall, in such manner as it thinks fit
and without delay, investigate the dispute and all matters affecting the
merit and the right settlement thereof and may do all such things as it
thinks fit for the purpose of inducing the parties to come to a fair and
amicable settlement of the dispute.

(2) If a settlement of the dispute or of any of the matter in dispute is

arrived at in the course of the conciliation proceedings, the Board shall
send a report thereof to the appropriate government together with a
memorandum of the settlement signed by the parties to the dispute.

(3) If no such settlement is arrived at, the Board shall, as soon as

practicable after the close of the investigation, send to the appropriate
government a full report setting forth the proceedings and steps taken
by the Board for ascertaining the facts and circumstances relating to the
dispute and for bringing about a settlement thereof, together with a full
statement of such facts and circumstances, its findings thereon, the
reasons on account of which, in its opinion, a settlement could not be
arrived at and its recommendations for the determination of the dispute.

(4) If, on the receipt of a report under sub-section (3) in respect of a

dispute relating to a public utility service, the appropriate government
does not make a reference to a 86[Labor Court, Tribunal or National
Tribunal] under section 10, it shall record and communicate to the
parties concerned its reasons therefor.

(5) The Board shall submit its report under this section within two
months of the date 87[on which the dispute was referred to it] or within
such shorter period as may be fixed by the appropriate government:

PROVIDED that the appropriate Government may from time to time

extend the time for the submission of the report by such further periods
not exceeding two months in the aggregate:

PROVIDED FURTHER that the time for the submission of the report may
be extended by such period as may be agreed on in writing by all the
parties to the dispute.
Conciliation and Adjudication

It cannot be said that the presence of alternative method of compulsory

adjudication has a discouraging effect on conciliation. V.V. Giri, pointing
out the availability of adjudication as a major reason for the
ineffectiveness of conciliation, observed:

The major reason for the failure of conciliators in bringing about an

amicable settlement of matters in dispute is the fact that the law
provides for another remedy, namely, adjudication by tribunals. The
parties do not, therefore, place all their cards on the table during
conciliation proceedings and are not in a frame of mind to arrive at a
settlement, hoping as they do, that their respective viewpoints will be
appreciated and accepted by the tribunals.

Apart from this the NCL felt that there is need for certain other measures
to enable the conciliation officers to function effectively. They are:

(i) proper selection of personnel

(ii) (ii) adequate pre-job training and
(iii) (iii) periodic in service training through refresher courses,
seminars and conference.

Voluntary Arbitration
Arbitration is a procedure whereby a third party, whether an individual
arbitrator or board of arbitrators, not acting as a court of law, is
empowered to take a decision, which disposes of the dispute. Arbitration
is voluntary when both the parties to the dispute agree without any
compulsion from outside, to leave the dispute to the arbitrator and to
abide by the decision of the arbitrator. To ‘arbitrate’ means to give
judgement or “to make decision”.

The system of voluntary arbitration is generally seen as a method of

settling labour disputes, which operates, effectively as a substitute for
the strikes or lockouts. Voluntary arbitration has therefore been
encouraged and promoted as a matter of public policy in a good number
of countries.

Voluntary Arbitration in India

The origins of voluntary arbitration as a method of settlement of

industrial disputes in India go back to 1918, when the Ahmedabad Textile
Labour Association under the leadership of Gandhiji and the Ahmedabad
Mill owners’ Association successfully resolved the plague bonus dispute
through voluntary arbitration.
Thereafter, the Bombay Industrial Disputes Act, 1938 and its successor
Bombay Industrial Relations Act, 1946 recognized voluntary arbitration.
The first and second Five Year Plan documents emphasized the need to
popularise voluntary arbitration as part of government’s labour policy.

In 1964, the provision in the Industrial Dispute. Act relating to

arbitration, viz., Section 10-A, was amended mainly to provide for an
extended operation of arbitration award in cases of majority arbitration.

Further Section 89 of CPC, 1908 introduced the provision of arbitration.

It states that the dispute may be settle by:

a. Arbitration
b. Conciliation
c. Lok Adalat
d. Mediation

Further to promote the idea of voluntary arbitration as a substitute for

strikes and lock outs, the Government of India appointed in July 1967,
The National Arbitration Promotion Board (NAPB), to Constantly monitor
and provide necessary guidelines to promote arbitration.

Status of an Arbitrator under the Act

1) In the case of Rohtas Industries Ltd. v. Rohtas Industries Staff Union,
(1976) it was held that, The arbitrator appointed by the parties under
this Act is considered as a “statutory arbitrator” and a “tribunal” within
the meaning of Articles 136 and 227 of the constitution of India.

2) In the case of Gujarath Steel Tubes Ltd. v. Gujarath Steel Tubes

Mazdoor Sabha, the Supreme Court by a creative interpretation, which
may be considered as judicial legislation, conferred on an arbitrator the
same powers that are vested in the labour tribunals in cases of disputes
relating to discharge or dismissal of workman as punishment.

Voluntary reference of disputes to arbitration

(1) Where any industrial dispute exists or is apprehended and the

employer and the workmen agree to refer the dispute to arbitration,
they may, at any time before the dispute has been referred under section
10 to a Labour Court or Tribunal or National Tribunal, by a written
agreement, refer the dispute to arbitration and the reference shall be to
such person or persons (including the presiding officer of a Labour Court
or Tribunal or National Tribunal) as an arbitrator or arbitrators as may be
specified in the arbitration agreement.

(1A) Where an arbitration agreement provides for a reference of the

dispute to an even number of arbitrators, the agreement shall provide
for the appointment of another person as umpire who shall enter upon
the reference, if the arbitrators are equally divided in their opinion, and
the award of the umpire shall prevail and shall be deemed to be the
arbitration award for the purposes of this Act.]

(2) An arbitration agreement referred to in sub- section (1) shall be in

such form and shall be signed by the parties thereto in such manner as
may be prescribed.

(3) A copy of the arbitration agreement shall be forwarded to the

appropriate Government and the conciliation officer and the appropriate
Government shall, within one month] from the date of the receipt of
such copy, publish the same in the Official Gazette.

(3A) Where an industrial dispute has been referred to arbitration and the
appropriate Government is satisfied that the persons making the
reference represent the majority of each party, the appropriate
Government may, within the time referred to in sub- section (3) issue a
notification in such manner as may be prescribed; and when any such
notification is issued, the employers and workmen who are not parties
to the arbitration agreement but are concerned in the dispute, shall be
given an opportunity of presenting their case before the arbitrator or
arbitrators.]
(4) 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.

(4A) Where an industrial dispute has been referred to arbitration and a

notification has been issued under sub- section (3A), the appropriate
Government may, by order, prohibit the continuance of any strike or
lock- out in connection with such dispute which may be in existence on
the date of the reference.

(5) Nothing in the Arbitration Act, 1940 (10 of 1940 ), shall apply to
arbitrations under this section.
 CONCLUSION

In India industrial disputes are growing with the progress of

industrialisation in the country. Increasing price level, rising cost of living,
growing industrial inefficiency, indiscipline and sickness are the most
responsible factors for the growing industrial disputes in the country.

In 1951, total number of work stoppages was about 1,071 which involved
nearly 6.9 lakh workers and resulted in a total loss of 38.2 lakh man-days.
During the planning period, the problem of industrial disputes magnified
considerably. In 1974, total number of work stoppages rose to 2,938 and
number of workers involved significantly increased to 28.55 lakh
resulting in a huge loss of 402.6 lakh man-days.

In recent years also, the industrial disputes remain unabated. Thus the
number of man-days lost due to strikes and lockouts over industrial
disputes was 307.7 lakh in 1989-90 which declined significantly to 236.0
lakh in 1990-91. But in 1991-92, there was a sharp increase in the man-
days lost to the tune of 341.5 lakh. There has however, been a steep
decline in the mandays lost in 1992-93 which stood at 22.97 million
mandays.
There has been an improvement in the industrial relations scenario of
the country in the 1990s as compared to the 1980s as reflected in the
statement of mandays lost on account of strikes and lockouts. The above
table reveals that the number of strikes which was 732 in 1995 has
increased to 793 in 1997 and then it declined to 173 in 2012.

Considering the radical changes that have taken place in the domestic
industrial scenario and the labour market, Second National Commission
on Labour was set up to suggest among others, rationalisation of the
existing laws in the organised sector so as to make them more relevant
and appropriate in the changing context of globalisation and opening up
of the Indian Economy.
 REFERENCES

Books for Reference:

 Industrial Dispute Act by O.P. Malhotra

 Labour and Industrial Law by S.N. Mishra
 Labour and Industrial Law by Meena Paul
 Industrial Relations and Labour by S.C. Srivastav
 Labour and Industrial Law by V.G. Goswami
 Labour and Industrial Law by S.K. Mishra