Law Related to Industrial Discipline.

- G Ojha

 There is no separate law dealing with this subject. But

the IE SO Act, 1946 stipulates that the employer, before
taking any action, will give the employee reasonable
opportunity to defend himself in a proper domestic
enquiry. This has been supported by many decisions of
the Apex Court.
Model Standing Orders provide for disciplinary action for
misconduct and gives an illustrative list thereof. Certain
procedural formalities have to be followed before any
punishment is awarded.
Law of Disciplinary Action/ Domestic Enquiry is based on
a body of judgements of various Courts including High &
Supreme Court.

 The principles enunciated in many Court decisions

have to be followed in taking disciplinary action.
The procedure followed can be divided as follows:a) Misconduct.
b) Chargesheet.
c) Suspension Pending Enquiry.
d) Enquiry Proceedings
e) Findings
f) Decision.
g) Service of the order.

Misconduct.
It implies a wrongful intention and not merely an error of
judgment. It also means dereliction of or deviation from duty.
Some of the misconducts are illegal strike; theft, fraud or
dishonesty in connection with the employers business;
assaulting superiors , disobedience of lawful orders of
superiors, use of abusive language against officers,
coworkers, damage to property or goodwill, acts of
absenteeism/non-performance of duties etc.
The model standing orders gives a list of misconduct but
these acts of omission/commission are not exhaustive but
only illustrative.
The employees must know which act or omission would
constitute misconduct as to be visited with penalty.
There should
employment.

be

connection

between

misconduct

&

Chargesheet. I
Derived from the principle of Natural Justice. It provides an opportunity
to a person to give explanation for his conduct and to defend
himself/herself.
Following are the essential elements of a chargesheet:a) It should be in writing and properly worded. No vagueness to be
allowed.
b) It should clearly state the nature of offence, date, place and time of its
commission/omission.
c) It should quote the relevant clause(s) of the standing orders which
describe the alleged misconduct and liability for punishment for such
misconduct, if proved.
d) It should specify the time and date within which the written reply to be
submitted and that in absence of a written explanation, the enquiry will
be conducted ex-parte.
e) It should be issued under the signature of the Disciplinary Authority and
not the Enquiry Officer.

Chargesheet. II
Service of Chargesheet.
It should be served on the workman in presence of at least two
witnesses. If he accepts it, his signature or thumb impression be
obtained in duplicate copy of the chargesheet.
If the employee is absent or refuses to accept the chargesheet, it
should be sent by Regd. Post with A.D. to his last known address and
a copy be affixed on the notice board of the establishment.
The chargesheet is deemed to be properly served if the letter is
either delivered to the workman or returns unaccepted.
If the Regd. Letter is undelivered then the chargesheet to be served
in a local newspaper mentioning the name & other particulars of the
workman.
(Bata Shoe Co. Ltd. Vs. Ganguly (1961-I-LLJ303)SC))

Suspension Pending Enquiry.

Under the following circumstances, suspension may be
resorted to :a) Where his continuance at work place may prejudice
investigation, trial or any enquiry like tampering with
witness/documents.
b) Where his
discipline.

continuance

may

subvert

the

workplace

c) Where the Employer wants to set an example in the wider

interest of organizational discipline;
d) Where preliminary enquiry revealed a prima-facie case
justifying criminal or departmental proceedings likely to
lead to his dismissal/removal from service;
e) Where he engages in acts against the interest of security of
the company

Subsistence Allowance
Item 9 of the schedule to the IE(SO)Act, 1946 relates
to suspension or dismissal for misconduct.
The relevant certified standing order relating to the
establishment will govern the matter.
The 1982 amendment of the IE(S0) Act, 1946 provides
50% wage payment for the first 90 days of suspension
and 75% of wages for the remaining suspension
period provided the delay in completion of disciplinary
proceedings is not directly attributable to the
workman.
In case of dispute, the Labour court can be
approached whose decision will be final & binding.

Enquiry Proceeding. I
Enquiry is not necessary in the following situations :a) Where the employee has admitted his guilt
b) Where termination is in the form of retrenchment, transfer or
closure of the establishment.

The domestic enquiry proceedings are quasi-judicial in

nature unlike civil & criminal proceedings which are
judicial. In domestic enquiry, rules of natural justice and
fair play are very important. It is not necessary to follow
the procedure prescribed for trial or followed by courts
like administrating an oath, compelling attendance of
witnesses, rules of evidence etc.

Enquiry Proceeding. II
As a result of several court decisions, a body of rules of
procedure in conduct of disciplinary proceedings has
emerged over a period of time as follows:a) The accuseds explanation to be considered;
b) If explanation unsatisfactory, a notice giving time, place and date of
enquiry and the enquiry officers name to be served on the
accused;
c) Enquiry to be conducted in presence of the chargesheeted
workman;
d) An accused worker can be helped by his co-worker;
e) The companys witnesses are to be examined first in support of the
charges and afterwards the accused workmans witness;
f)

If the accused workman has to produce witness but refuses to do

so, this fact must be recorded by the enquiry officer;

Finding.
On completion of the enquiry, a report has to be
submitted by the Enquiry officer to the Disciplinary
Authority;
Report to contain all facts & circumstances, evidence
recorded and the analysis of conclusion;
Findings without any reason or perverse findings
should not be recorded;
The Enquiry officer not to make recommendation for
punishment or make any other recommendation.

Decision.
The Disciplinary Authority considers the finding of the enquiry officer and
if found guilty, punishment is awarded in accordance with the standing
Orders. In awarding punishment previous conduct, record and the gravity
of misconduct to be considered.
No punishment can be given on any ground not stated in the chargesheet.
The Disciplinary Authority should not be lower in rank than the Appointing
Authority of the employee.
The following are some of the punishments:a) Warning b) Fine c) Withholding or Stoppage of increments d) Reduction
in rank or demotion e) Discharge, f)Dismissal

Major & Minor Punishment.

As per Rule 17 of the Model Standing Order, a second show cause

notice must be given to an employee proposed to be dismissed from
service.

Service of the order.

Any order of punishment should be sent in writing to the
delinquent employee which alone completes the process
of Domestic Enquiry.
The order should refer to the chargesheet, the Enquiry
held, the findings of the Enquiry Officer, the decision and
the date from which the punishment is effective.
The letter should be signed by the D.A. and not the
delegated authority, especially when it is an order of
Discharge or Dismissal. The Supreme Court has accepted
the principle that the power to terminate is the necessary
adjunct of the power to appoint.

Some Case Laws. I

Failure to give second show cause notice to an employee
proposed to be dismissed from service will vitiate the
entire disciplinary proceedings.
(Somarajan Vs. Managment of ARC Engg.
Works, 1981 II LLJ 25 Madras)
The Supreme Court observed that whether or not an
authority is subordinate in rank to another has to be
determined with reference to the state of affairs existing
on the date of appointment. A subsequent authorization
made in favour of a junior person for making
appointments to same post cannot confer on him the
power to remove.
(Krishna

Kumar

Vs.

Divisional

Asstt.

Some Case Laws. II

Obedience to Authority at a workplace is not slavery and
not violative of ones rights. When punishment of
termination is awarded for hitting & injuring a superior
officer supervising the work of the employee, with no
extenuating circumstances established, the termination
is justified, proportionate and not harsh.
The Supreme Court, in this case set aside the award of
the Labour Court, the Industrial Court and the judgement
of the High Court upholding these awards. The Apex
Court agreed with the termination order of the Employer,
i.e. M.P. Electricity Board.
(M.P. Electricity Board Vs. Jagdish Chandra
Sharma Supreme Court dtd. 04/03/2005)

Questions?

Thank you!