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Industrial Disputes Act,1947

Industrial disputes are the disputes which arise due to any disagreement in an industrial relation. Industrial relations involve various aspects of interactions between the employer and the employees.

In the workplace, disagreements between employers and employees can lead to industrial disputes. Industrial relations cover a lot of stuff that goes on between bosses and their workers.

These disputes may take various forms such as protests, strikes, demonstrations, lock-outs(work stoppage initiated by the employer), retrenchment(reducing staff due to financial reasons), dismissal of workers, etc.

Effective dispute resolution mechanisms are a crucial component of a nation's labour law framework, regardless of its economic development level. The primary objective of labour policies is to establish efficient and fair and fast dispute settlement promoting peaceful workplace relationships and reducing conflicts.

What is the Industrial Disputes Act, 1947?

The Industrial Disputes Act, 1947 provides machinery for peaceful resolution of disputes and to build a positive workplace relationship between employers and workers. It is the act that governs labour regulations for all workers or persons working on the Indian mainland. It went into effect on April 1, 1947. This act was enacted to examine and settle workplace disputes.

The Industrial Disputes Act of 1947 is like a tool that helps employers and workers sort out their differences peacefully and build a cool workplace relationship. It's the law that sets the rules for all the working folks in India. It started on April 1, 1947, and its main job is to look into and settle any disputes that happen at work.

The labour law framework also establishes conciliation, arbitration, and adjudication mechanisms to promote cooperative and mutually beneficial relationships between employers and employees. The Industrial Dispute Act was one of the last legislative acts before the passing of the Indian Independence Act, 1947.

An "Industrial Dispute", according to Section 2(K) of the Industrial Dispute Act 1947, is any dispute or difference between

• employers and employers,

• employers and workers, or

• workers and workers,

The Industrial Disputes Act, 1947 has provided for the establishment of both internal and external mechanisms to settle industrial disputes. Internal mechanisms include bodies such as the works committee and the grievance redressal committee.

The Industrial Disputes Act of 1947 set up ways to handle conflicts within companies and outside. There are internal mechanisms like the works committee and the grievance redressal committee.

What are the key objectives of the Industrial Disputes Act?

The Industrial Dispute Act, 1947 has several key objectives which includes:

The Act's primary objective is to cultivate good relations between management and labour, ensuring industrial peace and stability.
The Act aims to prevent illegal work stoppages which is also known as strike and employer lockouts.
The Act aims to safeguards workers' rights, preventing unfair labour practices and providing protection to those affected by layoffs, retrenchment, or wrongful termination.
The Act seeks to enhance the working conditions of employees.
The Act seeks to promote collective bargaining and also peaceful dispute resolution through conciliation.
The Act mandates compensation for workers affected by business closure, layoffs, or removal of the employees.

How are industrial disputes resolved under the Act?

There are a few ways to settle industrial disputes, which help keep things peaceful so that employers and employees can work together without any drama. It's essential for the industry's growth, and here's how it works:

1. Conciliation:

Conciliation is a process where a neutral third-party enables negotiations between the parties to resolve industrial disputes.

The government can appoint conciliation officers to help settle industrial disputes. The parties involved in the dispute can also appoint a conciliator by mutual consent. Conciliation officers are expected to provide a judgement within 14 days of the process beginning. Their judgement is binding on both parties.

Section 4 of the Industrial Dispute Act, 1947 lays down the function of a conciliation officer, while Section 11 of the Industrial Dispute Act, 1947 lays down the powers vested upon a conciliation officer.

2. Arbitration:

Arbitration is a method of settling industrial disputes that involves a neutral third party making a binding decision on the dispute.

Section 10A of the Industrial Dispute Act, 1947 provides the provision for voluntary arbitration which in a real-world situation is completely carried out by adjudication.

Arbitration is a popular choice for settling disputes outside of court because it gives parties a lot of flexibility.

3. Adjudication:

Adjudication is the final legal option for resolving industrial disputes under the Industrial Disputes Act, 1947. It involves a government-appointed legal authority that intervenes to make a binding settlement between the parties. Adjudication comes in two forms: voluntary and compulsory. Voluntary adjudication involves parties in the process, initiated by the government. Compulsory adjudication, on the other hand, is government-initiated without party participation.

The industrial dispute will be settled by a three-tier system that includes:

Labor Court:
- As per Section 7 of the Industrial Dispute Act, 1947, a labor court will be formed.
- The labor court will have one person who is either an independent judge, a High Court judge, or a District Court judge.
- The judge can also be a former labor court judge with at least five years of experience.
- The labor court will handle matters like the validity of employer orders, the effects of standing orders, and giving relief to workers who were fired.

Industrial tribunal: The provision for the industrial tribunal is provided under Section 7A of the Industrial Dispute Act, 1947. One or more industrial tribunals can be set up by the government according to his desire with the courts being provided with wider jurisdiction in comparison with the labour court. The issues handled by the industrial tribunal includes wages related issues, bonus and provident funds that are provided, working hours of the employees, rationalisation.
National tribunals: A national tribunal is formed by the Central Government by an official gazette for adjudication of the industrial disputes that are considered to be of national importance. If a dispute between two parties of an industry reaches the national tribunal, then both the labour court and the industrial tribunal loses its jurisdiction over the matter.
Industrial Tribunal: The government can set up one or more industrial tribunals whenever they feel like it. These tribunals have a wider scope than labor courts and deal with issues like wages, bonuses, provident funds, working hours, and rationalization.
National Tribunals:

When an industrial dispute is deemed to be of national importance, the Central Government steps in and forms a national tribunal. This tribunal is announced in an official gazette. Once a dispute reaches the national tribunal, both the labor court and industrial tribunal lose their authority over the matter.

4. Court of inquiry:

The remedy in the form of a court of inquiry was first provided by The Trade Disputes Act, 1929 and was followed by the Industrial Dispute Act, 1947 also under Section 6. A Court of Inquiry is a formal investigation into a specific incident, issue, or situation, typically conducted by a judicial or quasi-judicial body.

5. Works committees:

The Works Committee is made up of representatives from both the employer and the employees. The number of employee representatives must be at least equal to the number of employer representatives. Employee representatives are chosen from the employees and in consultation with their trade union.

What are the rights and duties of workers under the Industrial Disputes Act?

The rights of workers under the Industrial Dispute Act are mentioned below:

Right to Freedom of Association: Workers have the right to freely form and join unions mentioned under Section 17 of the Act.
Right to Collective Bargaining: Collective bargaining is a process where workers, through their representatives, negotiate with employers to reach mutually acceptable agreements mentioned under Section 18 of the Act.
Right to Strike: The right to strike is a fundamental right of workers to collectively refrain from working, aimed at achieving specific goals or resolving disputes mentioned under Section 22-24.
Right to Conciliation: Resolution through conciliation officers (Section 4).
Right to Tribunal: Adjudication by labour courts/tribunals (Section 7).

The duties of the workers under the Industrial Dispute Act are:

General duties of the workers such as obeying lawful instruction, punctuality, and performing duties assigned are mentioned under section 10 of the act.
Workers cannot go on strike while conciliation proceedings are ongoing or within seven days after the proceedings end. Additionally, they cannot strike without providing a six-week notice period before the commencement of the strike
Workers who have been employed for at least one year at a closed-down undertaking are entitled to notice and compensation.
Workers must maintain confidentiality regarding the employer's trade secrets, business strategies, client information, financial data etc.

What are the recent amendments to the Industrial Disputes Act?

Industrial Disputes (Amendment) Bill, 2010

This bill proposed to:

Expand the definition of "appropriate government”
Increase the wage ceiling for supervisors.
Allow workers to directly access labour courts or tribunals for individual disputes.
Expand the qualifications of presiding officers of labour courts or tribunals.
Set up grievance settlement machinery.

Other amendment include:

Prohibition of employment of children under 14 years.
State governments are required to provide medical facilities for workers and their families if the employer defaults
A new Section 32-C was inserted to prescribe how employers register compensation for accidents with the Commissioner
Penal provisions were made more stringent to ensure effective implementation of the Act

Frequently Asked Questions(FAQ’s):

What replaced the Industrial Disputes Act?
The Industrial Dispute Act was replaced by the Industrial Relations Code, 2020.
How to raise an Industrial Dispute?
A worker can raise a dispute directly before a Conciliation Officer in the case of discharge, dismissal, retrenchment or any form of termination of service.
What are the main causes for industrial disputes?
Industrial disputes arise due to various factors, including unequal wage structures, conflicts between labor unions and industries, and the neglect or violation of workers' rights.
How many sections are there in the Industrial Dispute Act, 1947?
There are 40 sections in the Industrial Disputes Act, 1947.

Reference:

Written by Disha Maheswari

Disha is a motivated and results-driven professional with strong problem-solving abilities. She excels in communicating complex ideas to both technical and non-technical stakeholders and enjoys working with diverse teams. Constantly seeking personal and professional growth, Disha is dedicated to achieving excellence and contributing effectively to any organization.