File Copyright Online - File mutual Divorce in Delhi - Online Legal Advice - Lawyers in India

Workplace Conflicts: Understanding the Industrial Dispute Act

Sec.2 (j) of the Industrial Disputes Act, 1947 defines 'industry' as any business, trade, undertaking, manufacture, or calling of employers and includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen".

An industry exists only when there is relationship between employers and employees, the former is engaged in business, trade, undertaking, manufacture or calling of employers and the latter is engaged in the calling, service, employment, handicraft or industrial occupation and avocation.

Sec. 2(j) gives the definition of industry, which was elaborated upon by the Supreme Court in the Bangalore Water Supply and Sewerage Board v. R. Rajappa[i]. The term industry has been given a wide scope and the judgment overruled several earlier decisions. The court held-
  • Any activity will be industry if it fulfills the 'triple test', as under:
    1. Systematic and organized activity
    2. With the cooperation between Employers and employees
    3. For the production and distribution of good and services whether or not capital has been invested for this activity.
  • It is immaterial whether or not there is profit motive or whether or not there is capital.
  • If the organization is a trade or business it does not cease to be one because of philanthropy animating the triple test, cannot be exempted from scope of definition of industry.
  • Dominant nature test � whether there is complex of activities, the test would be predominant nature of services and integrated nature of departments. All departments integrated with industry will also be industry.
  • The exceptions to industry are:
    1. Casual activities (because they are not systematic).
    2. Small clubs, co � operatives, research labs, gurukuls which have an essentially non-employee character.
    3. Single door lawyer taking help from clerk (because there is no organized labour).
    4. Selfless charitable activities carried on through volunteers e.g. free legal or medical service.
    5. Sovereign functions � strictly understood, i.e., maintenance of law and order, legislative functions and judicial function.

Charitable Institutions:
  1. Those that yield profit, but the profits are not siphoned off for altruistic purposes;
  2. Those that make no profit but hire the service of employees as in any other business, but the goods/services which are the output, are made available at a low or no cost to the indigent poor;
  3. Those that are oriented on a humane mission fulfilled by men who work, not because they are paid wages, but because they share the passion for the cause and derive job satisfaction.
The first two categories are industries, but not the third, on the assumption that they all involve co-operation between employers and employees.

In State of Bombay v. Hospital Mazdoor Sabha,[ii] the Supreme Court held the State is carrying on an 'undertaking' within Sec. 2(j) when it runs a group of hospitals for purpose of giving medical relief to the citizens and for helping to impart medical education. The court observed as follows:

An activity systematically or habitually undertaken for the production or distribution of goods or for the rendering of material services to the community at large or a part of such community with the help of employees is an 'undertaking.

It is the character of the activity in question which attracts the provisions of Sec. 2 (j), who conducts the activity and whether it is conducted for profit or not, do not make a material difference.

Thus, activities that have no commercial implications, such as hospitals carried on with philanthropic motives would be covered by the expression 'undertaking'. The mere fact that Government runs such activity is immaterial. In case an activity is industry if carried on by a private person, it would be so, even if carried on by the Government.

In Management of Safdarjung Hospital v. Kuldip Singh [iii], it was held that a place of treatment of patients run as a department of the government was not an industry because it was a part of the functions of the government. Charitable hospitals run by Government or even private associations cannot be included in the definition of industry because they have not embarked upon economic activities analogous to trade or business. If hospitals, nursing home or a dispensary is run as a business in a commercial way, there may be elements of industry.

In Dhanrajgiri Hospital v. Workmen [iv] , the main activity of the hospital was imparting of training in nursing and the beds in the hospital were meant for their practical training. It was held not to be an industry, as it was not carrying on any economic activity in the nature of trade or business.

In Bangalore Water Supply v A. Rajappa [v], the Supreme Court overruled Safdarjung Hospital and Dhanrajgiri Hospital cases, and approved the law laid down in Hospital Mazdoor Sabha case. It was held that hospital facilities are surely services and hence industries. The government departments while undertaking welfare activities cannot be said to be engaged in discharging sovereign functions and hence outside the ambit of Sec.2(j) of the Act.

Therefore, a charitable hospital run by a private trust, offering free services and employing a permanent staff is an industry as there is a systematic activity, a co � operation between employer and employees and rendering of services which satisfies human wants and wishes. Further, the services of employees are hired as in any other business.

Legal Firm
In National Union of Commercial Employees v. M.R. Meher,[vi] it was held that a solicitor's firm is not an industry, although specifically considered, it is organized as an industrial concern. The court held that a person following a liberal profession does not carry on his profession in any intelligible sense with the active co-operation of his employees, and the principal/sole capital which he brings into his profession is his special and peculiar intellectual and educational equipment.

Subsidiary work which is purely incidental type and which is intended to assist the solicitor in doing his job has no direct relation to the professional service ultimately rendered by the solicitor. There is, no doubt, a kind of co-operation between the solicitor and his employees, but that co-operation has no direct or immediate relation to the advice or service which the solicitor renders to his client.

However this was overruled by Bangalore Water Supply case [vii], wherein it was held that in view of the infrastructure of the offices of professional persons, the contribution to the success of the institution comes not merely from the professional or specialist but from all those whose excellence in their respective spheres makes for total proficiency.

Thus functional cooperation between employer and employees is essential for the total quality of service. But in the categories of such and allied professions when such co-operation is missing they are not industries.

A legal consultant firm employing two law graduates stenographer and a peon is an industry.

After the flare-up of World War 1, the work associations showed up as present day worker's organizations. Accordingly, as their numbers expanded, participation extended and they became dynamic in looking to advance and protect the interests of laborers, they needed to confront the open threats of the businesses and the public specialists. In the year 1921, the nearby governments are mentioned to discover the perspective on open bodies and private people on certain associated issues like the standards of proposed enactment, acknowledgment of strikes, insurance of worker's guilds from common and criminal liabilities, the executives of associations and others.

In the wake of getting the perspectives on the neighborhood governments, the public authority of India drew up a bill in 1925. The Bill was spent the following year as the Indian Trade Union Act, 1926. The Act with ensuing changes is as yet in power in the country. The object of Trade Unions Act, 1926 is to accommodate enlistment of Trade associations and to characterize law identifying with enrolled worker's organizations in specific angles. This Act stretches out to the entire of India.

What is a Trade Union? Meaning and Definition
A Trade Union is an intentional association of the laborers in a particular industry or occupation. Article 19(1)(c) of the Constitution of India ensures opportunity of relationship as a central right and gives the laborers, right to consolidate and put together for aggregate activity or deal. Nonetheless, a right isn't accessible for a specific class of occupations. It is because of the sensible limitation which can be forced by the Government according to the arrangements of the Constitution of India.

As per G.D.H. Cole:
A worker's organization implies a relationship of laborers in at least one callings an affiliation is continued for the most part to secure and propelling the individuals' monetary interest regarding their everyday work.

As indicated by S.D. Punekar:
A worker's guild is a ceaseless relationship of people in the business whether boss or free specialists framed fundamentally with the end goal of the quest for the interests of its individuals from the exchange they address.

As indicated by Dale Yoder:
A worker's organization as a proceeding with long haul relationship of representatives, shaped and kept up with for the particular motivation behind progressing and securing the interest of the individuals in their functioning relationship.

Section 2(h) of the Trade Unions Act, 1926 characterizes Trade Union as "any mix whether brief or extremely durable, framed basically.

Important elements of Trade Union:
  • There must be combination of workmen and employers;
  • There must be trade or business; and
The main object of the Union must be to regulate relations of employers and employees or to impose restrictive conditions on the conduct of any trade or business.
  • To work on the monetary parcel of laborers by getting them better wages.
  • To get for laborers better working conditions.
  • To get reward for the specialists from the benefits of the undertaking/association.
  • To guarantee stable work for laborers and oppose the plans of the board which lessen business openings.
  • To give lawful help to laborers regarding debates with respect to work and installment of wages.
  • To secure the positions of work against conservation and cutback and so on.
  • To guarantee that laborers get according to rules fortunate asset, annuity and different advantages.
  • To get for the laborer's better wellbeing and wellbeing government assistance plans.
  • To get laborers interest in administration.
  • To instill discipline, self-esteem and pride among laborers.
  • To guarantee openings for advancement and preparing.
  • To get hierarchical effectiveness and high usefulness.
  • To create a serious modern work power for further developing productivity of the framework.

Registration of Trade Union
The enrollment of a worker's organization isn't obligatory, however it is prudent to enlist the worker's guilds as the enrolled worker's organizations are qualified for get a few advantages, resistances and insurance under the demonstration. There are explicit rights and advantages presented on the individuals from the enlisted worker's organizations. The individuals from the enrolled worker's organizations are qualified for get insurance, invulnerability and certain exemptions from some respectful and criminal liabilities.

A worker's guild must be enrolled under the Trade Unions Act, 1926, and can't be enlisted under some other demonstration including the Societies Registration Act or the Co-employable Societies Act or the Indian Companies Act.

A Civil Servants' Union can't be enrolled under the Trade Unions Act, 1926. On account of Tamilnadu N.G.O's Union versus The Registrar of Trade Unions (AIR 1962), the Madras High Court excused the allure on the ground that, to get the worker's guild enlisted under the Trade Unions Act, 1926, the individuals from the association should be laborers occupied with exchange, business or industry and the appellants for this situation are not in that limit, as they are government workers occupied with the undertakings of the sovereign government.

The methodology which is followed for the enlistment of worker's organization is that a suitable Government will delegate an individual as Registrar of Trade Unions for each State. [Section 3(1)]. Application for enlistment is needed to be made endorsed by somewhere around 7 individuals. Application ought to be joined by rules of worker's guild and other required subtleties. [section 5]. Rules ought to contain arrangements as recommended in segment 6. Recorder will enroll Trade Union and enter points of interest in the register kept up with by him. [section 8]. Worker's organization will have an enrolled office. [section 12].

Any at least seven individuals from the association can shape a worker's organization and apply to the Registrar for its enlistment by buying in their names to its principles. Any seen or more individuals from a worker's guild may, by buying in their names to the guidelines of the worker's organization and by in any case following the arrangements of this Act as for enlistment, apply for enrollment of the worker's guild under this Act.

Given that no Trade Union of laborers will be enlisted except if something like 10% or many the workers, whichever is less, drawn in or utilized in the foundation or industry with which it is associated are the individuals from such worker's organization on the date of making of utilization for enrollment:

Given further no Trade Union of workers will be enrolled except if it has on the date of making application at least 7 people as its individuals, who are laborers drawn in or utilized in the foundation or industry with which it is associated.

Privileges and Immunities of Registered Trade Unions
The Trade Unions Act, 1926 presents certain advantages and invulnerabilities to the individuals and heads of the enrolled worker's guilds to empower them to do their authentic worker's organization exercises with no dread or danger of common or criminal activity/risk. It is the main right without which the workplace carriers of the enlisted worker's guilds will most likely be unable to release their obligations proficiently.

The Trade Unions Act, 1926 has made arrangements for the individuals and office-carriers of an enrolled worker's guild from criminal and common intrigues during the strikes and making any monetary misfortune the business.

Under Sections 17 and 18 the Trade Unions Act, 1926 an enlisted worker's guild gets insusceptibility in certain lawbreaker, common, and legally binding procedures.

It was held after 1921 Buckingham and Carnatic Mills case. There was a strike by the specialists of Buckingham and Carnatic Mills in the city of Madras (presently called Chennai), India, against the overseeing organization, Binny and Co. The strike, which endured from June to October 1921, made extreme misfortunes the Madras economy.

Immunities Against Criminal Conspiracy In Trade Disputes (Sec 17)
No office-conveyor or individual from an enlisted Trade Union will be responsible to discipline under sub-area (2) of segment 120 B of the Indian Penal Code, in regard of any understanding made between the individuals to additional any such object of the Trade Union as is indicated in segment 15, except if the arrangement is a consent to submit an offense.
Conditions Applicable:
  • The individual looking for the invulnerability ought to be the workplace conveyor or individual from a Trade union
  • Such Trade union should be enlisted;
  • The individuals ought to have had the consent to accomplish some legal object;
  • The objects of the understanding should be covered under Section 15 of the Act; Protection is just for those intrigues covered under S 120B (2), IPC and
  • If the arrangement is a consent to submit an offense, then, at that point no insurance is accessible under the Act.
Extent of Immunity:
  • S. 17 grants assertion of strike in facilitation of Trade Dispute subject to the arrangements of the ID Act including SS. 22, 23, 24 and 25.
  • It gives insusceptibility just from criminal scheme not from criminal offense.
  • Immunity is accessible just to the degree of lawful and serene strike.
  • There is no resistance from the offense of criminal intrigue in instances of unlawful strike, as such activity is culpable under S. 26 of the ID Act.
Important Cases:
R.S. Ruikar v Emperor AIR 1935 Nag 149

For this situation the leader of Nagpur Textile Union called a strike as specific conditions in the terms of settlement of a strike in the earlier year had been avoided by the Express Mills in Nagpur.

For getting the ideal outcomes, the TU began picketing.

Picketing implies the presence at a's business of at least one representatives as well as different people who are publicizing a work question, impacting representatives or clients to retain their work or business, individually, or showing an association's longing to address workers; picketing is generally joined by watching with signs.

It was grumbled that two ladies picketers were badgering by the police and were driven away.

Afterward, the president carried his significant other to one of the plant entryways and posted her there and trained her to beat with shoes any individual who meddled with her.

The president was captured, indicted and sentenced for abetment for picketing under S. 7 of the Criminal Amendment Act, 1932 for attack while picketing and its abetment.

It was fought that there was a debate between S. 7 of the Criminal Amendment Act and Trade Union Act 1926.

It was likewise battled for this situation that there is a contention between S. 7 of the Criminal Amendment Act and S. 17 of the TU Act, as the option to strike and insusceptibility under SS. 17 and 18 would not be of any assistance if S. 7 of the Criminal Amendment Act was held as relevant.

The Court saw for this situation that the worker's guilds have right to pronounce a strike and to do certain demonstrations in assistance of exchange debates.

It further saw that they are not responsible commonly or criminally for scheme in assistance of such goes about as allowed by the TU Act yet there isn't anything which separated from giving resistance in regards to criminal intrigue permits invulnerability from criminal offenses.

The Court chose for this situation that the candidate was appropriately indicted, as when serene demonstrators or strikers resort to unlawful imprisonment of people or criminal attack or wickedness to an individual or property there is no exception from risk.

Jay Engineering Works Ltd. V State of West Bengal AIR 1968 Cal 407
  • Whether Gera is secured under the TU Act as a method for strike?

Gera implies actual bar of an objective either by infringement or coercive occupation. It is a kind of actual block and is an offense under S. 340 of the IPC.

It limits the development of an individual. The laborers of a TU can be reserved for the offense of legend.

The Calcutta High Court for this situation pronounced that legend is an unlawful method for dissent or show. Based on realities and conditions it very well may be held lawful however the extension is truly restricted.

It further held that if an individual or number of people illegitimately bind someone else or people, it is rudimentary that it goes under SS. 339(wrongful restriction)/340 (unjust control) of the IPC read with SS. 341/342 (disciplines of these violations) of the IPC and can't be saved by Section17, TU Act.

Immunity From Civil Suit In Specific Cases (Sec 18)
No suit or other legal action will be viable in any Civil Court against any enrolled Trade Union or any office-conveyor or part thereof in regard of any demonstration done in examination or promotion of an exchange debate to which an individual from the Trade Union is a party on the ground just that such demonstration incites another individual to break an agreement of work, or that it is in impedance with the exchange, business or work of another individual or with the right of another individual to discard his capital or of his work as he wills.

A enlisted Trade Union will not be at risk in any suit or other judicial procedure in any Civil Court in regard of any convoluted demonstration done in examination or promotion of an exchange debate by a specialist of the Trade Union in case it is demonstrated that such individual acted without the information on, or in spite of express guidelines given by, the chief of the Trade Union

The topic of invulnerability under segment 18 of the Trade Union Act was managed for the situation between Ahmedabad Textile Research Association versus Atira Employees Union and Anr. (1995 (1) LLN 348; (1994) IILLJ 912 GU) wherein the division seat of the Gujarat High Court held that as long as the holding of shows or yelling of trademarks, showing of notices or holding of dharnas don't turn unlawful, convoluted or rough such worker's guild exercises is admissible and genuine.

Notwithstanding, while at the same time articulating its judgment the Court was additionally of the assessment that any exercises with respect to making harm the property of and hindering entrance into and departure from the offended parties' organization will be understood as unlawful and convoluted and couldn't be secured.

In choosing the degree of resistance accessible to a worker's guild under the arrangement of area 18 of the Trade Union Act the Karnataka High Court in Simpson and Group Companies Workers and Staff Union versus Amco Batteries Ltd. (1991 LLR 95 Karn HC; 1994 II LLN 147) decided that till the activity of the association are serene the association can appreciate insusceptibility under the Act.

It held that the direct of the laborers in the moment case in obstructing the entry of men and material of the Plaintiff-Company despises resistance under Section 18 of the Trade Unions Act. It was likewise seen by the Court that under a lock out or strike circumstance the insurance under area 18 doesn't get expanded as the thought and the guideline are same under both the circumstances.

  1. What is conciliation? Participation by a third party in an industrial dispute between management and its employees in order to bring them together to resolve their differences is termed mediation or conciliation.
  2. Which are the authorities competent for holding conciliation? Section 4 of Industrial Disputes Act 1947 empowers the appropriate government to appoint such number of persons as may be deemed necessary by notification in the official gazette as conciliation officers, for discharging the responsibility of mediating in and promoting the settlement of industrial disputes. All Labour officers, Asst. Labour Commissioner including Dy. Labour Commissioner, Labour appointed conciliation officers. Government of N.C.T. of Delhi for administrative and public convenience has divided entire territory into 9 districts i.e. East, North-East, South-West, West, South, North, North-West, Central & New Delhi.
  3. What are the functions of conciliation officers? Section 12 of I.D. Act 1947 provides duties of conciliation officers. A conciliation officer is required to investigate without delay the industrial disputes and make efforts to settlement thereof and for the purpose of bringing about a settlement of the dispute he may do all such things as he deems fit for the purpose of bringing parties to come to a fair and amicable settlement of the disputes.
  4. Can conciliation officer bind the parties? No. A conciliation officer has no authority or power to force the parties to agree to his suggestions. He merely offers his services through his good offices to find an amicable solution and will meet the needs of the two parties. He may suggest an answer to the problem.
  5. Whether conciliation is mandatory or discretionary? In the case of public utility services where a notice under section 22 of the I D Act, 1947 has been received, the conciliation officer must necessarily hold immediate conciliation proceedings for the prompt settlement of the disputes. He has discretion in respect of non-public utility services.
  6. When should a conciliation officer intervene in industrial disputes? Intervention must not be either premature or too late. Time for intervention may be chosen by the conciliation officer with due care.
  7. When are conciliation proceedings commenced? Conciliation proceedings in public utility services are deemed to have commenced on the date when the conciliation officer receives the notice of strike or lock-out u/s 122 of I.D. Act 1947 and in such cases, he has to act with great speed to complete the proceedings within 14 days. In the case of non-public utility services, the conciliation officer has to give formal intimation in writing to the parties declaring his intention to commence conciliation proceedings with effect from such date as he may specify.
  8. When are conciliation proceedings deemed to have concluded? The conciliation proceedings are concluded in the following manner:
    1. Where conciliation ended in settlement - the date on which the settlement is signed by the parties to the disputes, or
    2. Where conciliation ended in failure, the date on which the failure report of the conciliation officer is received by the appropriate Govt.
    3. When a reference is made to a Labour Court / Industrial Tribunal during the pendency of conciliation proceedings.
  9. Whether parties are required to be informed about the failure of conciliation? Yes, copies of the failure report under Section 12(A) of I.D. Act 1947 are required to be sent to the parties to the dispute.
  10. Whether a conciliation officer can arrive at an ex-parte conclusion of proceedings? Yes, If the party raising the dispute fails to turn up without reasonable cause, the case may be closed under intimation to it. If the opposite party fails to turn up, despite having been given a reasonable number of opportunities, an adverse inference may be drawn, and the case is proceeded with on an ex-parte basis.

The industrial disputes act extends to the whole of India. It came into the operation on 1st day of April 1947. The object of the act laid down in the preamble of act is to make provision for the investigation and settlement of industrial dispute. The object of all the legislation is to ensure fair wages and to prevent disputes so that production might not adversely affect.

The object of industrial disputes act 1947
  • The promotion of measures for securing good relations between the employers and employees.
  • An investigation and settlement of industrial disputes between employers and employees.
  • The prevention of illegal strike or lockout.
  • Relief to workmen in the matter of lay-off, retrenchment, and closure of an undertaking.
  • Collective bargaining.
A number of authorities for the settlement of industrial disputes and their power, function, and duties are as follows:
  • Work committee
  • Conciliation officer
  • Board of conciliation
  • Court of enquiry
  • Labour court
  • Tribunal
  • National tribunal

Definition and meaning
The term industrial diputes has been defined in section 2(k) of the industrial disputes act 1947 according to it:

Industrial dispute means any dispute or difference between employer and employer or between employer and workmen or between workmen and workmen which is connected with the employment or non employment or with the terms of the employment or with the condition of labour of any person.

Above definition shows following essential elements:
  • Dispute and deference between employer and employer or between employer and workmen or between workmen and workmen.
  • Such dispute is connected with the employment or non-employment or with the terms of the employment or with the condition of labour of any person.
  • Such dispute or difference could be related to any workmen or any other person in which they keep the interest collectively.

Case law: Dimakuchi Tea Estate's workman v/s Manager of Dimakuch Tea Estate AIR 1959 8

It was held that the industrial disputes need not to be related to any workmen. The term any other person used in the definition shows that it could be any person whose interest is vested in term of employment and condition of labour.

Case law:
Tate Chemical v/s workmen 1978 SC
It has been said that industrial disputes does not requires that it must be limited to the union representative collectively of majority of employer and workmen but union could be which shall not be represented because the definition of industrial dispute provides that it is sufficient to be dispute between employee and workmen.

Case law:
Sarvashramik Sangh v/s Indian Hume Pipe company ltd. 1993
It is held by the court that industrial dispute is required to related to the condition of employment. Such condition may be related to the salary, allowance, bonus, illegal termination of service and lock-out etc.

The word industry has an important place in the industrial dispute act 1947. It is the industry in which industrial dispute arises. The industrial dispute act cannot be thought without the industry.

Definition and meaning
Section 2(j) of the industrial dispute act 1947 deals with the definition of industry according to this definition---

"Industry means any business, trade, undertaking, manufacture or calling of employers and includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen."

The definition of industry can be divided into two parts:
  • Firstly any business, trade, undertaking, or calling of the employers and
  • Secondly it includes any calling, service, employment, handicraft or industrial occupation or avocation of workmen.
Case law:
Management of Safdergung Hospital v/s Kuldip sing AIR 1970 SC
The SC held that it is not proper to divide the definition of industry into two parts. It is shown from reading the definitions a whole that an industry is a collective organization in which both employer and workmen are included. It existence is not merely by employer only nor by workmen only.

Case law--Workmen of I.S. Institution v/s I.S Institution AIR 1976
It was said that industry is conducted by a collective effort of both employer and workmen. Industry only comes in existence when there is cooperation between employer and workmen and which results in any business, trade, undertaking, manufacture or calling of employers and any calling, service, employment, handicraft, or industrial occupation or a vocation of workmen.

Principles of determining nature of industry
Whether any institution is industry or not the principle regarding this determination has been propounded from time to time by the courts in their following judgment.:

Case law:
State of Bombay v/s Bombay Hospital Mazdoor sabha AIR 1960 SC

SC judges P.B Gajendra and Gadkar had propounded following principal:
Any activity which in a well organized way or regular form is conducted for the production of goods or its distribution of goods or to support the workmen for the service of any where community or its any particulars class is an undertaking.
In simple terms, an industry can be described by the following:
  • Such activity which has the support of both employer and workman.
  • Its object is always to satisfy human physical requirements.
  • It is organized in the same way as a business.
  • It is not only for personal interest or satisfaction.
Thus the method by which any work is performed, together with conditions of mutual cooperation between employee and workmen and objects of physical service.

Case law:
Banglore Water supply v/s A. Rajappa AIR 1978 SC

A seven judge bench of SC considered the scope of industry and laid down the following lists which are called principle of the triple test:

System activity
Cooperation of the workman and employer (capital and labour)

Objection of production and distribution
The principle conclude that if any trade, club, educational institution, cooperative, committee, research institution, hospital, municipality, charity organization includes all the above elements then it will be called industry.

Is Municipal Corporation an industry:?
Municipality and Municipal Corporation are industry under the Bangalore water supply case because the municipality and municipal corporation works related to the fire, electricity, water-supply, health which are service as well as undertaking therefore is an industry.

Case law:
Nagar Smithi Faridabad v/s K.L. Gosai 1970

In this case MC and municipality considered as industry.

Is Hospital an industry--?
The question whether hospital is an industry or not has come for determination by the supreme court on a number of occasions and the uncertainty has been allowed to persist because of conflicting judicial decisions right from hospital mazdoor sabha case to the Bangalore water supply .

Now the situation is those hospitals which are maintained by the state as their sovereign function and their only object is to free service to patients is not an industry.

In the contrary the hospital whether public or private charitable or commercial shall be industry if they fulfill the condition propounded in the Bangalore water supply and in Bombay hospital mazdor sabha case.

Is public service commission an industry?
The PSC is not an industry because good and service are not produced and distributed in it. The main function is to select the capable candidate for the different post and to recommended to the govt.

Case law:
Nazia bibi v/s Public service commission 1983
It was held by the court that PSC is not an industry because its main function is to select the candidate for the different post and no goods or services are produced and distributed there.

Is university/educational institution an industry?
Regarding the educational institution the present postion is that the educational institutions including the university in a limited sense. Now those employs of the educational institution who covered by the definition of workman under section 2(s) of the industrial dispute act 1947 will be treated as workmen of any industry.

Case law:
Delhi university v/s ram nath 1963 SC
It was held that university was not considered as industry because its main function is to provide the education which is not a business, trade or occupation.

Case law:
Somerchan v/s labour court 1992
In Labour cout Ambala it is decided that university is an industry and a carpenter employed in a university is a workmen and the labour courts has a jurisdiction to decide the dispute related to the termination of such service.

Case law:
Suresh Chandera Mathe V/S Jiwaji University Gwalior And Others 1994 MP

It was held that university is an industry and th clerk of a university is a workman.

Is club an industry?
Club or self service institution or non-proprietary members will be an industry provided they fulfill the triple test laid down in the water supply case.

Case law:
Cricket club of India v/s Bombay labour Union 1969

It was held that the voluntary organization and the non-proprietary clubs was also an industry if they fulfill the triple test laid down in the water supply case.

Workman is the base of the industry. Industry can nither be established or maintained without the workman. It is the workman who provides labour to the industry. It is the reason that workman has been given special place in the industrial dispute act. The definition of workman is important because the act aims at investigation and settlement of industrial dispute which implies a difference between an employer and workmen. So it is very necessary to decide who is a workman or employees.

Section 2(S) of the industrial dispute act 1947, workman means any person employed in any industry to do any manual , unskilled, skilled, technical, operational, clerical, supervisory work for heir or reward whether the term of the employment be expressed or implied and for the purpose of any proceeding under this act in relation to an industrial dispute including any such person who has been dismissed, discharged or retrenched in connection with or as consequences of that dispute or whose dismissal, discharge or retrenchment has led to the dispute.
Above definition of workman shows the following symptoms:
  • A workman must be employed in an industry
  • Employment for heir or reward
  • There shall be some consideration
  • Nature of work performed by such person may be manual, skilled, unskilled, technical, operational, clerical, or supervisory.
  • Industry in which workman is employed shall be an industry as defined in section 2(J) of IDA 1947
  • The section 2(a) of the IDA 1947 clearly mentions that the terms of the employment may be expressed/implied
  • In relation to an industrial dispute, a workman includes any such person who has been dismissed, discharged, or retrenched, or as consequences of the dispute has been dismissed, discharged, or retrenched.
Person not included as workman:
  • Who is subject to Air Forces Act, Army Act, and Navy Act.
  • Person employed in police services or jail services.
  • Person employed in a managerial or administrative capacity.
  • Person employed in a supervisory capacity drawing wages exceeding 1600 rupees per month.

The word workmen has been defined by several judicial decisions

Case law:
Bihar State Road transport cooperation v/s state of Bihar AIR 1970 SC

It was held that such person has been considered as workman who:
  • Was employed as head clerk in the office of regional manager.
  • His term of employment were being regulated by the orders of state roadways department.
  • His nature of work was not managerial or administrative.
Case law:
H.C chuahan v/s life insurance corporation of India 1982

It was held that such development officers were held to be workman who:
  • Perform daily, manual, mechanical or clerical work
  • Do not perform managerial or administrative work
  • Cannot appoint or dismiss any other
  • Cannot also distribute the work
  • Obtained a salary of approx. Rs 500 or more.

Case law:
Verma shall company v/s Verma shall management staff association 1970 SC

This case has an important place in the definition of workman.

The supreme court propounded 2 principle for the workman. It was stated by the SC that:
  1. Nature of work
  2. No managerial work

What is Retrenchment?
Retrenchment of employees is one of the ways companies use to terminate employees when the company is forced to downsize its number of employees. Subsidiary companies of Multinational Corporations often resort to retrenchment in labour law to deal with their expenditure on human resources. However, companies often fail to consider the legal requirements to be carried out before retrenching their employees.

Definition of Retrenchment of employees is terminating an employee due to the surplus of labor or incapacity of employees to match the performance standards of the company. The Industrial Dispute Act, 1947 deals with employment-related disputes in India and Section 2(oo) of the Act states that 'retrenchment means termination of service of a workman by an employer for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action.
  • Voluntary retirement of a workman
  • Retirement of workmen on reaching the age of superannuation if the employment agreement contains a provision regarding superannuation
  • Termination of service of a workman due to the non-renewal of employment agreement
  • Termination on grounds of continued ill-health

Difference between Layoff & Retrenchment:
Layoff Retrenchment:
  • Layoffs refer to the temporary suspension of an employee by the employer. Retrenchment is the permanent termination of an employee.
  • It majorly occurs due to some financial challenges or temporary shutdown of the business. It is caused by a strategic approach that is necessary to reduce costs, downsize the company, or simply restructure the organization.
  • Employees may be rehired when issues are resolved. Employees shall not be rehired.
  • It is temporary in nature. It is permanent.
  • You may or may not need to serve a notice period. You must serve the notice period in this case.
  • Business may stop during the layoffs. Business shall continue after declaration.
  • You may receive severance pay or certain benefits. You may not get any compensation or benefits.
  1. Industrial Disputes

Law Article in India

Ask A Lawyers

You May Like

Legal Question & Answers

Lawyers in India - Search By City

Copyright Filing
Online Copyright Registration


How To File For Mutual Divorce In Delhi


How To File For Mutual Divorce In Delhi Mutual Consent Divorce is the Simplest Way to Obtain a D...

Increased Age For Girls Marriage


It is hoped that the Prohibition of Child Marriage (Amendment) Bill, 2021, which intends to inc...

Facade of Social Media


One may very easily get absorbed in the lives of others as one scrolls through a Facebook news ...

Section 482 CrPc - Quashing Of FIR: Guid...


The Inherent power under Section 482 in The Code Of Criminal Procedure, 1973 (37th Chapter of t...

The Uniform Civil Code (UCC) in India: A...


The Uniform Civil Code (UCC) is a concept that proposes the unification of personal laws across...

Role Of Artificial Intelligence In Legal...


Artificial intelligence (AI) is revolutionizing various sectors of the economy, and the legal i...

Lawyers Registration
Lawyers Membership - Get Clients Online

File caveat In Supreme Court Instantly