LABOUR LAW

MODULE 3: BI-PARTITE FORUMS

Works Committee (SECTION 3)

1. Applicability:
• If an industrial establishment has 100 or more workers (currently employed or
employed at any time in the past 12 months), the Government can ask the employer to
set up a Works Committee.
• This can be done through a general or special order.
2. Composition of the Works Committee:
• The Committee will include representatives of both the employer and the workers.
• Workers' representatives cannot be fewer than the employer’s representatives.
3. Selection of Workers' Representatives:
• Workers' representatives will be chosen in a way prescribed by the law.
• This selection must involve consultation with their Trade Union (if registered under
Section 9).
4. Purpose and Duties of the Works Committee:
• Promote good relations between the employer and workers.
• Discuss issues of common interest or concern.
• Try to resolve any significant disagreements on such matters.

Grievance Redressal Committees (SECTION 4)

1. Applicability:
• Every industrial establishment with 20 or more workers must set up one or more
Grievance Redressal Committees to resolve disputes related to individual grievances.
2. Composition of the Committee:
• The Committee must have an equal number of representatives from the employer
and workers.
• The chairperson will be selected alternatively from employer and worker
representatives on a rotational basis every year.
 • The total number of members must not exceed 10.
• Adequate representation for women workers is mandatory and must match the
proportion of women workers in the establishment.
3. Filing a Grievance:
• An aggrieved worker can file an application with the Committee in the prescribed manner
within one year from the date of the grievance.
4. Timeline for Resolution:
• The Committee must complete its proceedings within 30 days of receiving the grievance.
5. Decision-Making:
• Decisions are made based on the majority view.
• At least half of the workers' representatives must agree for the decision to be valid.
• If no majority is achieved, it will be deemed that no decision was made.
6. Appeal Process:
• If the worker is dissatisfied with the decision or if no resolution is reached within 30 days,
they can file an application for conciliation to the conciliation officer through their Trade
Union within 60 days.
7. Special Provisions for Termination Disputes:
• If a worker is discharged, dismissed, retrenched, or terminated, such disputes will be
considered industrial disputes even if no other worker or Trade Union is involved.
8. Direct Application to Tribunal:
• If the worker's grievance remains unresolved even after conciliation, they can apply
directly to the Tribunal:
o After 45 days from applying to the conciliation officer.
o The application must be made within 2 years from the date of discharge,
dismissal, retrenchment, or termination.
9. Tribunal’s Jurisdiction:
• Once the application is made, the Tribunal has the authority to adjudicate the dispute as
if it were filed under Section 53(6).
MODULE 4: TRADE UNION
Registrar of trade union (section 5)

1. Appointment by the State Government:

• The State Government can appoint the following through a notification:

o Registrar of Trade Unions.

o Additional Registrar, Joint Registrar, and Deputy Registrar of Trade

Unions.

• These officers will perform the powers and duties of the Registrar as specified
by the State Government.

2. Roles of Additional, Joint, and Deputy Registrars:

• If an Additional Registrar, Joint Registrar, or Deputy Registrar handles the

powers and duties of the Registrar for an area where a Trade Union's registered
office is located:

o They will be considered the Registrar for that Trade Union under this
Code.

Application for registration, alteration of name and procedure thereof (section 8)

1. How to Apply:

• The application must be submitted to the Registrar (electronically or otherwise).

• It should include the following:

(a) A declaration made by affidavit in the prescribed form.

(b) A copy of the rules of the Trade Union and the resolution by members
adopting these rules.

(c) A copy of the resolution authorizing the applicants to apply for

registration.

(d) For federations or central organizations of Trade Unions:

 ▪ A resolution by each member Trade Union agreeing to form the
federation or organization.

Explanation:

• For federations or central organizations, resolutions must be passed separately

by members of each Trade Union involved.

2. Additional Requirement for Old Trade Unions:

• If the Trade Union has existed for more than one year before applying for
registration, a general statement of its assets and liabilities must be submitted
along with the application.

3. Registrar's Role:

• The Registrar can ask for additional information to ensure the application
complies with the Code.

• Registration may be refused until the required information is provided.

4. Name of the Trade Union:

• If the proposed name is:

o Identical to an existing registered Trade Union, or

o So similar that it could mislead the public or members of either Trade

Union,

o The Registrar will require the applicants to change the name before
registering the Trade Union.
Recognition of negotiating union or negotiating council (section 14)

1. Purpose:

• An industrial establishment with a registered Trade Union must have either a

negotiating union or a negotiating council for discussing matters prescribed
under the law.

2. Single Trade Union:

• If there is only one registered Trade Union in the establishment, the employer
must recognize it as the sole negotiating union, subject to prescribed criteria.

3. Multiple Trade Unions (With Majority Support):

• If there are multiple registered Trade Unions, the one with 51% or more support
of workers (on the muster roll) will be recognized as the sole negotiating union.

• Support must be verified as per prescribed procedures.

4. Multiple Trade Unions (Without Majority Support):

• If no Trade Union has 51% support, a negotiating council will be formed.

• The council will include representatives from all registered Trade Unions that
have at least 20% support of workers.

• Representation will be one representative for every 20% of support, with an

additional representative for any remainder.

5. Decision-Making in Negotiating Council:

• Agreements reached in the council must be supported by the majority of

representatives of the Trade Unions in the council.

6. Duration of Recognition:

• Recognition of a negotiating union or constitution of a negotiating council is

valid for 3 years.
 • This can be extended up to a maximum of 5 years, if mutually agreed by the
employer and Trade Union.

7. Facilities for Negotiating Union or Council:

• The industrial establishment must provide prescribed facilities to the negotiating

union or council.

Objects of general fund, composition of separate fund and membership fee of

Trade Union (section 15)

1. Use of General Funds:

• The general funds of a registered Trade Union can only be used for prescribed
purposes.

2. Creation of a Separate Fund:

• A registered Trade Union may establish a separate fund for promoting the civic
and political interests of its members.

• Contributions to this fund must be collected separately and can only be used for
prescribed objects.

3. Voluntary Contribution to Separate Fund:

• Members cannot be compelled to contribute to the separate fund.

• Non-contributors cannot be:

o Denied benefits of the Trade Union.

o Placed at any disadvantage compared to contributors (except in managing

the fund).

o Required to contribute as a condition for joining the Trade Union.

4. Membership Fees:

• Subscriptions payable by members must follow the prescribed rules.

Immunity from civil suit in certain cases (section 16)

1. Protection from Civil Suits:

• A registered Trade Union or its members cannot be sued for acts done in
furtherance of an industrial dispute, even if:

o It induces someone to break a contract of employment, or

o Interferes with trade, business, or employment.

2. No Liability for Agents' Acts:

• Trade Unions are not liable for tortious acts by their agents if those acts were
done:

o Without the knowledge of the executive, or

o Against the express instructions of the executive.

Criminal conspiracy in furtherance of objects of Trade Union (section 17)

1. Immunity from Punishment:

• Members or office-bearers of a registered Trade Union are not liable under

Section 120B(2) of the Indian Penal Code for agreements made to further
Trade Union objectives, unless the agreement is to commit an offence.

Enforceability of agreements (section 18)

1. Agreements Not Void:

• Agreements among Trade Union members are not void or voidable even if they
restrain trade.

2. Exception:

• Civil courts cannot enforce agreements or award damages for breaches

regarding:

o Conditions under which members sell goods, transact business, work,

employ, or be employed.
Disqualification of office bearers of Trade Unions (section 21)

1. Disqualification Criteria:

A person cannot be chosen or remain as an office-bearer or executive member of a

registered Trade Union if:

• (i) They are under 18 years of age.

• (ii) They have been convicted of an offense involving moral turpitude and
sentenced to imprisonment, unless 5 years have passed since their release.

• (iii) They have been disqualified by a Tribunal for a specified period.

2. Restrictions on Ministers and Office Holders:

• Members of the Council of Ministers or individuals holding an office of profit

(not related to the industry or establishment connected with the Trade Union)
cannot be office-bearers or executive members of a Trade Union.

Adjudication of disputes of Trade Unions (section 22)

1. Types of Disputes:

Disputes can be referred to the Tribunal if they involve:

• (a) One Trade Union vs. another Trade Union.

• (b) Members of a Trade Union vs. the Trade Union itself (related to registration,
administration, management, or election of office-bearers).

• (c) Workers denied membership to a Trade Union.

• (d) Disputes within a federation of Trade Unions (raised by an authorized

office-bearer).

2. Jurisdiction:

• Applications for adjudication must be made to the Tribunal having jurisdiction

where the Trade Union’s registered office is located.

3. Exclusion of Civil Courts:

• Civil courts cannot entertain disputes listed under this section. Only the
Tribunal has the authority to handle such cases.
MODULE 5: STRIKES AND LOCKOUTS

Prohibition of strikes and lock-outs (section 62)

1. Restrictions on Strikes

Employees of an industrial establishment cannot go on strike in breach of contract under

the following conditions:

• (a) Without giving a notice of strike at least 60 days before the strike.

• (b) Within 14 days after giving such notice.

• (c) Before the strike date specified in the notice.

• (d) During the pendency of conciliation proceedings and for 7 days after their
conclusion.

• (e) During the pendency of proceedings before a Tribunal or National

Industrial Tribunal and for 60 days after their conclusion.

• (f) During the pendency of arbitration proceedings (if notified by the

government) and for 60 days after their conclusion.

• (g) During the period when a settlement or award is in effect, for matters
covered by the settlement or award.

2. Restrictions on Lockouts by Employers

Employers cannot lock out workers under the following conditions:

• (a) Without giving a notice of lockout at least 60 days before the lockout.

• (b) Within 14 days after giving such notice.

• (c) Before the lockout date specified in the notice.

• (d) During the pendency of conciliation proceedings and for 7 days after their
conclusion.

• (e) During the pendency of proceedings before a Tribunal or National

Industrial Tribunal and for 60 days after their conclusion.
 • (f) During the pendency of arbitration proceedings (if notified by the
government) and for 60 days after their conclusion.

• (g) During the period when a settlement or award is in effect, for matters
covered by the settlement or award.

3. Exceptions

• A notice of strike or lockout is not required if there is already an existing strike

or lockout. However:

o Employers must send intimation of the strike/lockout to the specified

authority on the day it is declared.

4. Manner of Giving Notice

• Notice of Strike:

o Must be given by the required number of persons in the prescribed

manner.

• Notice of Lockout:

o Must also be given in the prescribed manner.

5. Reporting to the Government

• If an employer:

o Receives a strike notice or issues a lockout notice, they must report it

within 5 days to:

▪ The appropriate Government or its designated authority.

▪ The conciliation officer.

Illegal strikes and lock-outs (section 63)

1. Conditions for Illegality

A strike or lockout is deemed illegal if:

• (i) It is commenced or declared in violation of Section 62 (failure to follow

notice requirements, timelines, or restrictions during proceedings).

• (ii) It is continued in contravention of an order issued under Section 42(7)

(prohibitions imposed during proceedings or emergency situations).

2. Exceptions for Ongoing Strikes or Lockouts

• If a strike or lockout has already started before an industrial dispute is:

o Filed before a Tribunal, or

o Referred to an arbitrator or National Industrial Tribunal,

the strike or lockout will not be deemed illegal if:

o It was legal when it began, and

o Its continuation is not prohibited under Section 42(7).

3. Consequences of Illegal Actions

• A lockout declared due to an illegal strike or a strike declared due to an

illegal lockout will not be considered illegal.

Prohibition of financial aid to illegal strikes or lock-outs (section 64)

1. Spending or Applying Money:

No individual is allowed to knowingly spend or use money directly to support or
promote an illegal strike or lockout.
MODULE 6: VOLUNTARY REFERENCE OF DISPUTES TO ARBITRATION
AND MECHANISM FOR RESOLUTION OF INDUSTRIAL DISPUTES

Voluntary reference of disputes to arbitration (section 42)

1. Agreement to Arbitrate

• Employers and workers may refer an existing or apprehended industrial

dispute to arbitration by a written agreement specifying the arbitrator(s).

2. Provision for Umpire in Case of Deadlock

• If the arbitration agreement involves an even number of arbitrators, it must

appoint an umpire.

o The umpire intervenes when arbitrators are equally divided in opinion.

o The umpire's award is considered the final arbitration award under this
Code.

3. Form and Submission of Arbitration Agreement

• The arbitration agreement must:

o Follow the prescribed format and

o Be signed by the parties as per the prescribed manner.

• A copy of the agreement must be sent to the appropriate Government and the
conciliation officer.

4. Notification by Appropriate Government

• When the dispute is referred to arbitration, and the appropriate Government

verifies that the majority of each party is represented:

o It may issue a notification.

o Employers and workers not party to the arbitration agreement but

connected to the dispute will be given a chance to present their case before
the arbitrator(s).
5. Representation of Workers

• For disputes other than termination:

o Workers are represented by:

▪ The negotiating union or council, if it exists.

▪ The Trade Union, if no negotiating union or council exists.

▪ Representatives chosen in a prescribed manner if no Trade Union

exists.

• For disputes relating to termination of an individual worker:

o The concerned worker may represent themselves or through an

authorized representative.

6. Submission of Award

• The arbitrator(s) must:

o Investigate the dispute.

o Submit the arbitration award signed by the arbitrator(s) to the

appropriate Government.

7. Prohibition of Strike or Lockout

• Upon referral to arbitration and issuance of notification:

o The appropriate Government may prohibit the continuation of any

strike or lockout related to the dispute that was in existence on the date of
referral.

8. Exclusion of the Arbitration and Conciliation Act, 1996

• Arbitration under this section is not governed by the provisions of the

Arbitration and Conciliation Act, 1996.
Conciliation officers (section 43)

1. Appointment of Conciliation Officers

• The appropriate Government can appoint conciliation officers through a

notification. These officers are responsible for mediating and promoting the
settlement of industrial disputes.

2. Scope of Appointment

• A conciliation officer may be appointed for:

o A specified area,

o Specific industries within an area, or

o For one or more industries within a defined region.

• The appointment can be either permanent or for a limited period.

Industrial Tribunal (section 44)

1. Constitution of Industrial Tribunals

• The appropriate Government can create one or more Industrial Tribunals to

adjudicate industrial disputes and perform other duties assigned under this Code.

• Tribunals constituted by the Central Government will also have jurisdiction

and powers under the Employees' Provident Funds and Miscellaneous
Provisions Act, 1952.

2. Composition of Industrial Tribunals

• Each Industrial Tribunal consists of two members:

o A Judicial Member, and

o An Administrative Member.

• The Tribunal may also operate with a single Judicial Member or a single
Administrative Member.
3. Qualifications and Terms of Appointment

• The qualifications, recruitment methods, term of office, salaries, allowances,

resignation, removal, and other terms for both members of the Tribunal shall be
as prescribed under rules made by the Finance Act, 2017.

• Judicial Members: Specific rules govern their recruitment and service

conditions.

• Administrative Members: Persons below the rank of Joint Secretary (or

equivalent) are not eligible for this role in the Tribunal.

4. Terms and Conditions for State Appointed Members

• The terms and conditions for Judicial Members and Administrative Members
appointed by a State Government shall be prescribed by the State Government.

• Once appointed, salary and allowances cannot be changed to their

disadvantage.

5. Tribunal Procedure

• The procedure of the Tribunal (including case distribution) will be prescribed.

• Cases related to certain matters will be handled by a bench consisting of both

Judicial and Administrative Members, including:

o Application of standing orders,

o Discharge, dismissal, or reinstatement of workmen,

o Illegality of strikes or lockouts,

o Retrenchment of workers or closure of establishments, and

o Trade Union disputes.

• Other cases may be handled by a bench consisting of either a Judicial Member

or an Administrative Member.
6. Leadership of the Tribunal

• The Judicial Member will preside over a Tribunal when it has both a Judicial
and an Administrative Member.

7. Vacancies in the Tribunal

• If there is a vacancy (other than a temporary absence) in a National Industrial

Tribunal or an Industrial Tribunal, it will be filled in a prescribed manner.

• The proceedings will continue from the stage where the vacancy is filled.

8. Staffing of Tribunals

• The appropriate Government may appoint officers and staff in consultation

with the Judicial Member to ensure the smooth functioning of the Tribunal.

National Industrial Tribunal (section 46)

1. Constitution of National Industrial Tribunals

• The Central Government can establish National Industrial Tribunals through

a notification. These tribunals are created to adjudicate industrial disputes that
are:

o Of national importance, or

o Involve disputes affecting industrial establishments in multiple States.

2. Composition of National Industrial Tribunals

• Each National Industrial Tribunal will consist of two members appointed by

the Central Government:

o One Judicial Member, and

o One Administrative Member.

3. Qualifications for Judicial Member

• To be eligible for appointment as a Judicial Member, a person must be or have

been a Judge of a High Court.
4. Qualifications for Administrative Member

• To be eligible for appointment as an Administrative Member, a person must be

or have been:

o Secretary to the Government of India, or

o Hold an equivalent rank in the Central or State Government with

adequate experience in handling labour-related matters.

5. Role of Judicial Member

• The Judicial Member will preside over the National Industrial Tribunal.

6. Procedure for Selection and Terms of Service

• The selection procedure, salaries, allowances, and other terms and conditions
of service for both Judicial and Administrative Members will be prescribed by
the Central Government.

7. Staffing for National Industrial Tribunal

• The Central Government may appoint the necessary officers and staff in
consultation with the Judicial Member of the National Industrial Tribunal to
ensure its efficient functioning.
Disqualifications for members of Tribunal and National Industrial Tribunal
(section 48)

1. Eligibility for Appointment

A person shall not be appointed or continue in the office of a member of a Tribunal or

National Industrial Tribunal if:

• (a) Not Independent: The person is not an independent individual, meaning they
are connected to the industrial dispute or the industries involved in the dispute.

• (b) Age Limit: The person has attained the age of sixty-five years.

• Explanation: "Independent person" means an individual who has no direct or

indirect connection with the industrial dispute or the industry involved in the
dispute.

Procedure and powers of arbitrator, conciliation officer, Tribunal and National

Industrial Tribunal (section 49)

1. Procedure to Be Followed

• An arbitrator, conciliation officer, Tribunal, or National Industrial Tribunal

shall follow the procedure deemed fit by the respective body, in accordance with
the provisions of the Code and any applicable rules.

2. Power of Conciliation Officers

• Conciliation officers and authorized officers may, after reasonable notice, enter
the premises of any establishment involved in the dispute for inquiry.

3. Powers of Conciliation Officer, Tribunal, and National Industrial Tribunal

• They possess powers similar to those of a civil court under the Code of Civil
Procedure, 1908 when trying a suit. These powers include:

o (a) Enforcing the attendance of a person and examining them on oath.

o (b) Compelling the production of documents and material objects.

o (c) Issuing commissions for witness examination.

 o (d) Exercising other powers as may be prescribed.

• Any inquiry or investigation by a Tribunal or National Industrial Tribunal is

considered a judicial proceeding under sections 193 and 228 of the Indian
Penal Code.

4. Powers of Conciliation Officer to Enforce Attendance and Inspect Documents

• A conciliation officer has the same powers as a civil court to:

o Enforce attendance of any person for examination.

o Call for and inspect any documents deemed relevant for the industrial
dispute or for verifying the implementation of an award.

5. Appointment of Assessors or Experts

• The appropriate Government may appoint persons with special knowledge of

the subject matter as assessors or experts to advise a Tribunal or National
Industrial Tribunal.

6. Status as Public Servants

• All conciliation officers and members of a Tribunal or National Industrial

Tribunal are considered public servants under section 21 of the Indian Penal
Code.

7. Discretion Over Costs

• The Tribunal or National Industrial Tribunal has the discretion to determine

the costs of any proceedings. The Tribunal can decide:

o Who is liable for the costs.

o The extent and conditions under which costs are to be paid.

o The costs may be recovered by the appropriate Government as arrears

of land revenue.
8. Status as Civil Courts

• A Tribunal or National Industrial Tribunal is deemed to be a civil court for

the purposes of sections 345, 346, and 348 of the Code of Criminal Procedure,
1973.

9. Execution of Awards and Orders

• Any award, order, or settlement made by a Tribunal or National Industrial

Tribunal will be executed in the same manner as an order or decree of a civil
court under Order XXI of the Code of Civil Procedure, 1908. The Tribunal
or National Industrial Tribunal is treated as a civil court for this purpose.

Transfer of pending cases (section 51)

1. Transfer of Pending Cases

• From the date of commencement of this Code, the cases that were pending
immediately before such commencement in the following bodies will be
transferred to the corresponding tribunals under this Code:

o (a) Labour Courts and Tribunals under the Industrial Disputes Act,
1947 will be transferred to the Tribunal having corresponding
jurisdiction under this Code.

o (b) National Tribunal under the Industrial Disputes Act, 1947 will be
transferred to the National Industrial Tribunal having corresponding
jurisdiction under this Code.

2. Dealing with Transferred Cases

• The cases transferred under sub-section (1) will be dealt with either:

o De novo (from the beginning), or

o From the stage where they were pending before the transfer, depending
on what the Tribunal or National Industrial Tribunal deems fit.

Adjustment of services of presiding officers under repealed Act (section 52)

1. Continuation of Judicial Members

• A presiding officer of a Labour Court, Tribunal, or National Tribunal

constituted under the Industrial Disputes Act, 1947, who was holding office
immediately before the commencement of this Code and is qualified to be
appointed under this Code, shall:

o Become the Judicial Member of the Tribunal or National Industrial

Tribunal.

o Continue in that role for the remaining period of his office.

Conciliation and adjudication of dispute (section 53)

1. Conciliation Proceedings (Subsection 1)

• If an industrial dispute exists or is anticipated, or if a notice under Section 62 has

been issued, the conciliation officer is required to conduct conciliation
proceedings in the prescribed manner.

• However, the conciliation officer is not allowed to conduct such proceedings if

two years have passed since the dispute first arose.

2. Investigation and Settlement (Subsection 2)

• The conciliation officer must promptly investigate the dispute and all related
matters to reach a fair and amicable settlement.

• The officer has the authority to take any actions they deem necessary to
encourage the parties to settle the dispute.

3. Report of Settlement (Subsection 3)

• If a settlement is reached during the conciliation proceedings, the conciliation

officer must send a report of the settlement to the appropriate Government or
an officer authorized by the Government. This report must include a
memorandum of the settlement, signed by the parties involved.

4. Report if No Settlement (Subsection 4)

• If no settlement is reached, the conciliation officer must send a full report to the
concerned parties and the appropriate Government as soon as possible after
the investigation concludes.

• The report should be in the prescribed electronic or other format and include:

o Steps taken by the officer to investigate and settle the dispute.

o A statement of facts and circumstances related to the dispute.

o Reasons why the settlement could not be reached.

5. Deadline for Reports (Subsection 5)

 • The conciliation officer must send the report within 45 days of starting the
conciliation proceedings or within a shorter period if specified by the
appropriate Government.

• If a notice under Section 62 was received, the report must be sent within 14 days
of starting the proceedings.

• The time for sending the report may be extended if agreed upon in writing by the
parties to the dispute, with the conciliation officer’s approval.

6. Application to Tribunal (Subsection 6)

• If the dispute is not resolved by the conciliation officer, any concerned party can
apply to the Tribunal within 90 days from receiving the report.

• The Tribunal will then decide on the matter in the prescribed manner.

Reference to and functions of National Industrial Tribunal (section 54)

1. Referral by Central Government (Subsection 1)

• The Central Government may refer an industrial dispute to a National

Industrial Tribunal if the dispute:

o Involves questions of national importance.

o Affects industrial establishments in more than one State.

2. Procedure after Referral or Transfer (Subsection 2)

• Once a dispute is referred or transferred to a National Industrial Tribunal, the

Tribunal must conduct proceedings expeditiously.

• The Tribunal must submit its award to the Central Government within the
specified period or any extended period set by the Government.
Form of award, its communication and commencement (section 55)

1. Nature of the Award (Subsection 1)

o The award given by:

▪ A Tribunal (consisting of a Judicial Member and an Administrative

Member or a single member).

▪ A National Industrial Tribunal.

o The award must be in writing and signed by the appropriate members (either
electronically or physically).

2. Communication of the Award (Subsection 2)

o The award must be communicated to the concerned parties and the

appropriate Government.

3. Enforceability of the Award (Subsection 3)

o The award becomes enforceable 30 days after being communicated, unless:

▪ The appropriate Government or the Central Government declares

that it is inexpedient to enforce the award due to public grounds
affecting national economy or social justice.

o In such cases, the Government may delay the enforceability of the award for
public interest reasons.

4. Government’s Order on the Award (Subsection 4)

o If the award is not enforceable, the appropriate Government (or Central

Government) has 90 days from the date of communication to:

▪ Reject or modify the award.

▪ Lay the modified award before the Legislature of the State or

Parliament.
5. Enforceability after Government's Order (Subsection 5)

o If an order rejecting or modifying the award is made, the modified award

becomes enforceable 15 days after being laid before the Legislature or
Parliament.

o If no such order is made within 90 days, the award becomes enforceable after
this period.

6. Effective Date of the Award (Subsection 6)

o The award comes into effect from the date specified in the award.

o If no date is specified, the award becomes effective on the date it becomes

enforceable (either after 30 days or 15 days, depending on the
circumstances).
MODULE 7: LAY-OFF, RETRENCHMENT AND CLOSURE

Definition of continuous service (section 66)

1. Definition of Continuous Service:

• Continuous service refers to the uninterrupted service of a worker, which

includes periods of absence due to:

o Sickness.

o Authorized leave.

o Accidents.

o A strike that is not illegal.

o A lock-out.

o Cessation of work that is not due to any fault of the worker.

2. Explanation 1: Calculation of Continuous Service

• If a worker has not been in continuous service for one year or six months, they
will be deemed to be in continuous service if the following conditions are met:

o For One Year: A worker must have worked at least:

▪ 190 days in a mine (underground work).

▪ 240 days in any other type of work during the previous twelve
months.

o For Six Months: A worker must have worked at least:

▪ 95 days in a mine (underground work).

▪ 120 days in any other type of work during the previous six
months.

3. Explanation 2: Days Included in the Calculation The following days are included
in the calculation of "days worked" for continuous service:
 • Laid-off days: If the worker was laid off under an agreement or as permitted by
law.

• Leave on full wages: If the worker was on leave with full wages earned in
previous years.

• Absence due to temporary disablement: If the worker was temporarily

disabled due to an accident arising out of and in the course of employment.

• Maternity Leave: For female workers, the days of maternity leave (not
exceeding the period specified in the Maternity Benefit Act, 1961) are counted
as part of the continuous service.

Rights of workers laid off for compensation, etc. (section 67)

1. Eligibility for Compensation:

o The worker must not be a badli (substitute) worker or a casual worker.

o The worker must have been on the muster rolls of the industrial
establishment and completed at least one year of continuous service under
the employer.

o If such a worker is laid off, either continuously or intermittently, the employer

is obligated to pay compensation for all days of lay-off, excluding weekly
holidays.

2. Compensation Amount:

o The compensation is 50% of the total of the worker's basic wages and
dearness allowance that would have been payable to him had he not been
laid off.

3. Limit on Compensation for Prolonged Lay-Off:

o If a worker is laid off for more than 45 days within any period of twelve
months, no compensation will be paid for any days of lay-off after the first
45 days, unless there is an agreement between the worker and the employer
stating otherwise.
4. Retraining of Worker After 45 Days:

o After the first 45 days of lay-off, if the worker has not returned to work and
there is an agreement, the employer may retrain the worker in accordance
with the provisions of Section 70. In this case, any compensation already
paid for the period of lay-off can be set off against the compensation due for
retrenchment.

5. Explanation of "Badli Worker":

o A badli worker is defined as a worker who is employed in place of another

worker whose name is on the muster rolls. However, the worker ceases to be
a badli worker if he completes one year of continuous service in the
establishment.

Workers not entitled for compensation in certain cases (section 69)

1. Refusal to Accept Alternative Employment:

o If the worker refuses to accept alternative employment offered by the

employer, they will not be entitled to compensation.

o The alternative employment can be within the same establishment or at

another establishment owned by the same employer, as long as it is located
within eight kilometers of the worker's usual place of work.

o The alternative employment must not require special skills or experience and
should be something the worker is capable of performing.

o The employer must offer wages equivalent to what the worker would
normally earn in their regular job for this alternative work.

2. Failure to Present for Work:

o If the worker does not present themselves for work at the establishment
during normal working hours, at least once a day, they will forfeit
compensation. This provision ensures that the worker is making themselves
available for work during the lay-off period.
3. Lay-Off Due to Strike or Production Slowdown:

o If the lay-off occurs as a result of a strike or slowing-down of production

by workers in another part of the same establishment, compensation shall not
be payable. This provision excludes workers from compensation if their lay-
off is indirectly caused by a labor dispute elsewhere in the organization.

Conditions precedent to retrenchment of workers (section 70)

1. Notice of Retrenchment:

• One month's notice is required before retrenching a worker who has completed
one year of continuous service, or the employer must pay the worker wages in
lieu of the notice period.

2. Compensation:

• At the time of retrenchment, the employer must pay compensation equivalent

to fifteen days' average pay for every completed year of continuous service or
any part thereof in excess of six months.

3. Notice to Government:

• A notice must also be served to the appropriate government (or authority

specified by the government) regarding the retrenchment in a prescribed manner.

Procedure for retrenchment (section 71)

1. When workers in an establishment belong to a particular category, and no agreement

exists between the employer and the worker about retrenchment, the employer must
ordinarily retrench the worker who was the last to be employed in that category.

• However, the employer can retrench any other worker, but must record the
reasons for doing so.
Re employment of retrenched worker (section 72)

1. If the employer hires a new worker within one year of retrenching a worker, the
employer must give an opportunity to the retrenched workers who are citizens of
India to offer themselves for re-employment.
2. Retrenched workers who apply for re-employment must be given preference over
other candidates.

Compensation to workers in case of transfer of establishment (section 73)

1. If the ownership or management of an establishment is transferred (either by

agreement or operation of law) to a new employer:

• Every worker who has been in continuous service for one year immediately
before the transfer is entitled to the same notice and compensation as if they
were retrenched.

2. Exemption: The provisions of this section do not apply if:

• The worker's service is uninterrupted by the transfer.

• The terms and conditions of service after the transfer are not less favorable
than those before the transfer.

• The new employer is legally liable to provide compensation as if the worker’s

service was uninterrupted.

Sixty days' notice to be given of intention to close down any undertaking (section
74)

1. Notice of Closure:

• An employer intending to close down an undertaking must serve at least 60

days' notice to the appropriate government before the closure date.

• The notice must clearly state the reasons for closure.

2. Exceptions:

• This requirement does not apply to:

o Industrial establishments employing less than 50 workers.

o Industrial establishments set up for construction projects (e.g.,

buildings, roads, dams, etc.).

3. Exemption in Exceptional Circumstances:

• If the closure is due to exceptional circumstances like an accident, death of the

employer, or natural calamities, the appropriate government may, by order,
exempt the employer from this notice requirement for a specific period.

Compensation to workers in case of closing down of undertakings (section 75)

1. Compensation Entitlement:

• When an establishment is closed, every worker who has been in continuous

service for at least one year is entitled to notice and compensation as if they
were retrenched (per Section 70).

• However, if the closure is due to unavoidable circumstances beyond the

employer's control, the compensation will be limited to the worker's average
pay for three months.

2. Unavoidable Circumstances:

• The following circumstances do not count as unavoidable:

o Financial difficulties or losses.

o Accumulation of unsold stock.

o Expiry of lease/license.

o In mining operations, if the minerals in the area are exhausted.

3. Mining Operations Exception:

• If the closure is due to exhaustion of minerals in a mining establishment,

workers may not be entitled to compensation if the employer provides
alternative employment within 20 km of the closed establishment under the
same terms and conditions, and service is uninterrupted.

4. Construction Undertakings:

• If the closure is due to the completion of construction work within two years,
workers will not be entitled to compensation.

• If the work is not completed within two years, workers are entitled to notice and
compensation for each completed year of service or part thereof exceeding six
months.
MODULE 8: OFFENCES AND PENALTIES

Cognizance of offences (section 87)

1. Restriction on Court's Cognizance:

• Courts cannot take cognizance of offences under this Code unless a complaint
is made by or under the authority of the appropriate Government.
2. Jurisdiction of Courts:
• Offences under this Code can only be tried by a Metropolitan Magistrate or a
Judicial Magistrate of the first class.
• Courts inferior to these ranks do not have the authority to try such offences.
Offences by companies (section 88)
1. Liability of Responsible Individuals:
• If an offence under the Code is committed by a company:
o Every person in charge of, or responsible for, the conduct of the
company's business at the time of the offence shall be deemed guilty.
o They are liable to be proceeded against and punished unless they can
prove:
▪ The offence was committed without their knowledge, and
▪ They exercised all due diligence to prevent the offence.
2. Liability of Specific Officers:
• If the offence is committed with the consent, connivance, or due to neglect of a
specific individual (e.g., director, manager, secretary, or other officers), that
individual is deemed guilty and is liable to prosecution and punishment.
3. Explanation of Key Terms:
• Company:
o Includes bodies corporate, such as:
▪ A firm,
▪ A limited liability partnership (LLP) under the Limited Liability
Partnership Act, 2008,
▪ Any association of individuals.
• Director:
o For a firm, this refers to a partner.
 Case law
Module: 5
1. THE GREAT BOMBAY TEXTILE STRIKE
The Great Bombay Textile Strike of 1982 was one of the largest and most significant
labor strikes in India's history, involving workers from the textile mills in Mumbai
(formerly Bombay). It was called by the Textile Workers' Union led by Dutta Samant
in response to demands for better wages, working conditions, and the protection of
workers' rights. This strike marked a significant moment in the Indian labor movement,
as it involved over 250,000 workers, with support from several labor organizations.
Key Facts:
• Duration: The strike lasted for several months, from January to April 1982,
and led to a major disruption in the textile industry in Bombay.
• Reasons:
o Demand for a wage hike.
o Improvement in working conditions and labor rights.
o Opposition to modernization in the industry, which some workers
feared would lead to mass layoffs.
o A push for better social security benefits and better treatment of workers.
• Outcome:
o The strike was eventually unsuccessful for the workers, as they failed to
achieve most of their demands.
o Mill closures increased during and after the strike.
o Despite its failure, the strike was a significant symbol of labor unrest and
the challenges faced by Indian textile workers.
o The strike led to a decline in Bombay's textile industry, with many mills
closing down or relocating.
The strike is seen as a turning point in labor politics in India and is often cited in
discussions of labor relations and industrial disputes.
2. BUCKINGHAM & CARNATIC CO. LTD. V/S WORKERS OF
BUCKINGHAM & CARNATIC CO. LTD. (AIR 1953 SC 47)
This case is a landmark ruling by the Supreme Court of India and deals with the
concept of industrial disputes and the principles related to termination of service. It
involved the dispute between the employer, Buckingham and Carnatic Co. Ltd., and
its employees.
Facts:
• The workers of Buckingham and Carnatic Co. Ltd. went on strike demanding
higher wages and better working conditions.
• The employer decided to dismiss some workers, which led to an industrial
dispute.
Issue:
The primary issue in this case was whether the dismissal of workers was justified and
whether it could be considered fair and reasonable in light of the circumstances of the
dispute.
Ruling:
The Supreme Court ruled in favor of the workers, holding that the dismissals were
unjust and violated the workers' rights under labor law.
• The Court emphasized that in cases of industrial disputes, dismissal could not
be arbitrary or based solely on the employer's will, especially in the absence of
a proper inquiry.
• The Court referred to the principles of natural justice and ruled that the workers
had a right to be heard before being dismissed.
The judgment established the principle that dismissals or terminations should not be
arbitrary and must be in accordance with procedural fairness as provided in labor laws.
3. INDIAN IRON & STEEL LTD. V/S ITS WORKMEN (1967) I LLJ 381 (PAT)
This case is significant in understanding the interpretation of labor rights and
employer-employee disputes in India.
Facts:
• The case involved Indian Iron & Steel Co. Ltd. and its workers.
• The workers had raised a dispute regarding their working conditions, wages,
and the implementation of certain statutory benefits that the employer had not
provided.
Issue:
The main issue in the case was whether the actions of the employer, in not providing
adequate statutory benefits or addressing workers' concerns, amounted to an unfair
labor practice under the relevant labor laws.
Ruling:
The Patna High Court upheld the rights of the workers, and the ruling clarified that
the workers were entitled to receive fair compensation, benefits, and protections as
prescribed by labor laws.
• The employer was ordered to ensure proper wage structure and other statutory
benefits for the workers.
This judgment is important for understanding how labor disputes involving basic rights,
such as wages and working conditions, are to be dealt with under Indian labor laws.
4. B. R. SINGH V/S UNION OF INDIA (1989) II LAB LJ 591 (SC)
The B. R. Singh v/s Union of India case is a Supreme Court judgment that deals with
issues related to retirement benefits, superannuation, and the legal rights of workers
in the context of industrial disputes.
Facts:
• B. R. Singh was an employee of the Union of India who had been serving in a
government establishment.
• Upon reaching the age of superannuation, he was denied his retirement benefits
or the pension that he was entitled to according to the applicable laws.
Issue:
The main issue was whether the worker, upon reaching retirement age, had a right to
his retirement benefits, and whether the delay in providing the benefits amounted to
violation of legal rights.
Ruling:
The Supreme Court ruled in favor of B. R. Singh, holding that the denial of
retirement benefits was illegal and an infringement of his fundamental rights.
• The Court emphasized that pension rights are vested rights and cannot be denied
unless the worker is disqualified by law or due to their misconduct.
• The ruling also clarified the employer's obligations to ensure timely and lawful
provision of retirement benefits to employees.
This case is important because it reinforced the legal rights of employees regarding
superannuation benefits, ensuring that such entitlements are provided under the
Industrial Disputes Act and other relevant labor laws.
Module: 7
1. KAIRBETTA ESTATE V RAJAMANICKAM (AIR 1960 SC 893)
This case is an important ruling related to the termination of service and rights of
workers under labor laws, especially in the context of unfair dismissal.
Facts:
• The case concerned a dispute between Kairbetta Estate, a plantation in the state
of Tamil Nadu, and its worker, Rajamanickam.
• Rajamanickam, a permanent worker in the estate, was dismissed from service
by the employer.
Issue:
The central issue was whether the dismissal of the worker was justified under labor
law and whether there had been any violation of the procedural fairness required in
cases of dismissal.
Ruling:
• The Supreme Court held that the dismissal was unjustified, as the employer
did not follow the proper procedure in terminating the employee’s service.
• The Court emphasized that the employer was obligated to provide a fair
opportunity to the employee to explain their conduct before dismissal.
• The Court also discussed the principles of natural justice, which require that the
employer must follow the prescribed procedure for dismissals as laid down in
the Industrial Disputes Act.
This case is significant in defining the procedural requirements for dismissals and
termination of employment under Indian labor laws.
2. EMPLOYERS IN RELATION TO DIGWADIH COLLIERY V. THEIR
WORKMEN (AIR 1966 SC 75)
This case deals with issues concerning retrenchment and the rights of workers
regarding their compensation and dismissal.
Facts:
• The Digwadih Colliery was a coal mine owned by the employer, and the
workers were employed in the colliery.
• A dispute arose over the retrenchment of workers, and the employer argued
that the retrenchment was due to economic reasons.
Issue:
The key issue in this case was whether the employer had complied with the procedures
for retrenchment laid down in the Industrial Disputes Act, particularly regarding
compensation and notice.
Ruling:
• The Supreme Court ruled that the retrenchment of workers was invalid
because the employer did not follow the prescribed procedures.
• The Court noted that the employer was required to give the workers notice and
compensation as stipulated by the Industrial Disputes Act, and failure to
comply with these provisions would render the retrenchment illegal.
This case is significant for understanding the legal framework for retrenchment and
the protection of workers' rights under Indian law.
3. WORKMEN OF AMERICAN EXPRESS INTERNATIONAL BANKING
CORPORATION V MANAGEMENT OF AMERICAN EXPRESS
INTERNATIONAL BANKING CORPORATION (1985) 4 SCC 71
This case discusses the application of labor laws to foreign companies operating in
India, particularly in relation to unionization and workers' rights.
Facts:
• The American Express International Banking Corporation had a branch in
India, and the employees were represented by a workers' union.
• The dispute involved the right of the workers to unionize and whether the
employer could deny workers' rights to negotiate terms and conditions of
employment.
Issue:
The issue in this case was whether the employer could interfere with the unionization
of workers and whether it was legally permissible to stop them from engaging in
collective bargaining.
Ruling:
• The Supreme Court held in favor of the workers and ruled that the employer
could not interfere with the workers’ right to form a union.
• The Court also emphasized that foreign companies operating in India must
adhere to Indian labor laws, including recognizing workers' right to collective
bargaining and unionization.
This case is a landmark decision regarding the rights of employees in foreign
companies and their right to form unions in India.
4. KRISHNA BHAGYA JALA NIGAM LIMITED V MOHAMMED RAFI (2006)
9 SCC 697
This case is related to service conditions, contractual employment, and right to
compensation for workers.
Facts:
• The case involved the Krishna Bhagya Jala Nigam Limited, a government
corporation, and its employee, Mohammed Rafi.
• Mohammed Rafi had been employed on a contract basis and was later
dismissed. He sought compensation and regularization of his service after
termination.
Issue:
The main issue was whether contractual workers had a right to regularization or
compensation under the relevant labor laws.
Ruling:
• The Supreme Court ruled that contractual employees are not entitled to
regularization or compensation unless there are exceptional circumstances or
unless their employment is considered permanent under law.
• The Court further clarified that the rights of contract workers should be
determined based on the terms and conditions outlined in their employment
contract.
This case provides important insights into contract labor laws and the limitations on
workers’ rights to claim benefits like regularization or compensation.
5. ASSOCIATED CEMENT COMPANIES V THEIR WORKMEN (AIR 1960 SC
56)
This case addresses issues related to industrial disputes, workplace conditions, and
the termination of employees in the context of workers' rights.
Facts:
• The case involved a dispute between the Associated Cement Companies
(ACC) and its workers regarding the conditions of service and termination of
workers.
Issue:
The primary issue was the legality of the termination of workers and whether the
dispute resolution mechanisms prescribed by law had been followed by the employer.
Ruling:
• The Supreme Court ruled in favor of the workers, stating that the employer’s
actions had violated the provisions of the Industrial Disputes Act regarding fair
treatment and procedural fairness.
• The Court reinforced the need for employers to follow due process when
terminating employees and upheld the rights of workers to seek fair
compensation.
This case is critical in the context of termination of service, workers’ rights, and
dispute resolution under the Industrial Disputes Act.