Industrial Disputes Act 1947

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14. What do you understand by the term ‘Industrial Dispute’? What are the main causes of industrial disputes in India? Explain. [Meerut, 2002; Garhwal, 2006 and 2008]

Meaning and Definition of Industrial Dispute.

Section 2(k) of the Industrial Disputes Act, 1947 defines a dispute as: “Industrial Dispute means any dispute or difference between employees and employers, or between employers and workmen, or between workmen and workmen which is connected with the employment or non-employment or the terms of employment or with the conditions of labor of any person.”

The analysis of the above definition of ‘dispute’ reveals the following salient features of an ‘Industrial Dispute’:

(i) There must be some 4ifference or dispute.

(ii) The difference or dispute must be between:

(a) employees and employers; or

(b) employers and workmen; or

(iii) The dispute must be connected with:

(a) the employment or non-employment; or

(b) the terms of employment; or

(iv) The dispute must relate to an ‘Industry’ as defined in Section The following points about industrial dispute arise from judicial decisions:

(i) In order to be an industrial dispute there must exist a real substantial and per Sis tent difference between the parties which will disturb industrial peace.

(ii) The dispute must be raised by the workmen against the employer. Mere demand to the Government without a dispute being raised cannot be called an industrial dispute.

(iii) In order to be an industrial dispute, large groups of workmen must be ranged against the employer. The dispute must be raised by the workmen themselves or by the union. There must community and commonality of interest which will naturally lead to collective bargaining. An individual dispute is not an industrial dispute.

(iv) It is not necessary that the union representing workmen must be registered.

(v) It makes no difference even if the union that takes up the cause of a dismissed employee, itself came into existence after the date of dismissal and the dismissed employee joined the union thereafter.

(vi) In a case where a workman was supported by an outside union, it was held it was not an industrial dispute because the union I was is no way connected with the industrial establishment and could not represent the workman.

Causes of Industrial Disputes: There are various causes of

arising industrial disputes which are as follows—

(i) Demand for increase in wages and remuneration.

(ii) Demand of improvement in working conditions.

(iii) Demand to oppose modernization and automation of Plant and Machinery.

(iv) Lack of recognition to Labour unions.

(v) Unlawful layoff and retrenchment policy.

(vi) Defective system of Recruitment and Promotions policies.

(vii) Unfair and partial treatment by the managers.

(viii) Defective leadership.

(ix) To support the strike in other organisations.

(x) Indulging in strikes due to political interest of trade unions.

(xi) Disobedience of code of Discipline.

(xii) Misbehavior with workers by management executives.

(xiii) Unhealthy relationship between labor and employer.

Q. 15. Critically discuss the machinery that exists under the Industrial Disputes Act for settlement of disputes. [Garhwal, 2008 B; Meerut, 1998 P, 1996 BP]

Explain clearly the machinery which exists for the prevention and settlement of Industrial disputes under the Industrial Disputes Act. [Bundelkhand Jhansi, 2011; Meerut, 1995 BP]

State and explain in detail all about the various authorities which can be created under the Industrial Disputes Act, 1947 for prevention and settlement of industrial disputes.

[Meerut, 1997, 1995]

Ans. The Industrial Disputes Act, 1947 was brought in for the purpose of investigating and settling the industrial disputes, With this object in view, the Act provides different authorities to help the investigation and settlement of such disputes.

The various modes of settlement of disputes provided under the Act may be classified under three heads, viz:

(l) Conciliation; (2) Adjudication; and (3) Arbitration.

(i) The authorities that take up conciliation as the sole method for settling disputes include: Works Committees; Conciliation Officers; and The Board of Conciliation.

(ii) Adjudication authorities that decide the disputes referred to them under the Act include : Courts of Inquiry; Labour Court; Tribunals; and National Tribunal.

(iii) Section 10-A of the Act provides for voluntary reference of disputes to arbitration.

Thus, in brief, The Industrial Disputes Act, 1947 provides the following authorities for the settlement of Industrial Disputes :

1. Works Committee: An industrial undertaking in which 100 or more workmen are employed or have been employed on any day in the preceding 12 months is required by the Government to constitute a works committee of equal number of representatives of workmen and employers. The representatives of workmen shall be chosen from among the workmen and in consultation with their registered trade union. The duty of the works committee is to promote measures for preserving and restoring amity and good relations and to comment upon matters of common interest or concern and end devour to compose any material difference of opinion in respect of such matters. [Sec. 3]

2. Conciliation Officers: The appropriate government may by notification in the Official Gazette, appoint such number of persons as it thinks fit to be conciliation officers. They will be responsible for mediation and promoting the settlement of industrial disputes. A conciliation officer may be appointed for a specified area or specified industries etc. either permanently or for a limited period. He is deemed to be a public servant within the meaning of Sec. 21 of the Indian Penal Code. The officer’s duty is to create a healthy atmosphere in the establishment in which employers and workmen can reconcile the disputes harmoniously through the mediation of the conciliation officer. [sec. 4]

3. Board of Conciliation: The appropriate Government may by notification in the Official Gazette constitute the Board of conciliation for promoting settlement of Industrial disputes. The Board of conciliation consists of a chairman and two or four other members as the appropriate government may thinks fit. The Chairman shall be an independent persons and the other members shall be persons appointed in equal numbers to represents the Parties to the dispute on the recommendations of that party. In case any party fails to make a recommendation within the prescribed

(1) Conciliation; (2) Adjudication; and (3) Arbitration.

(i) The authorities that take up conciliation as the sole method for settling disputes include: Works Committees; Conciliation Officers; and The Board of Conciliation.

(ii) Adjudication authorities that decide the disputes referred to them under the Act include: Courts of Inquiry; Labour Court; Tribunals; and National Tribunal.

(iii) Section 10-A of the Act provides for voluntary reference of disputes to arbitration.

Thus, in brief, The Industrial Disputes Act, 1947 provides the following authorities for the settlement of Industrial Disputes:

1. Works Committee: An industrial undertaking in which 100 or more workmen are employed or have been employed on any day in the preceding 12 months is required by the Government to constitute a works committee of equal number of representatives of workmen and employers. The representatives of workmen shall be chosen from among the workmen and in consultation with their registered trade union. The duty of the works committee is to promote measures for preserving and restoring amity and good relations and to comment upon matters of common interest or concern and endeavour to compose any material difference of opinion in respect of such matters. [sec. 3]

3. Board of Conciliation: The appropriate Government may by notification in the Official Gazette constitute the Board of Conciliation for promoting settlement of Industrial disputes. The Board Of conciliation consists of a chairman and two or four other members as the appropriate government may thinks fit. The Chairman shall be an independent persons and the other members shall be persons appointed in equal numbers to represents the Parties to the dispute on the recommendations of that party. In case any Party fails to make recommendations within the prescribed time, the Government shall appoint such persons as it thinks fit to represent that party. Even if any member or chairman is absent from the meeting, the Board can act provided there is a quorum. The quorum necessary to constitute the meeting is two, if the numbers of members are three and three when number of members are five. [Sec. 5]

4. Court of Inquiry: The appropriate government may by notification in the Official Gazette constitute a Court of Inquiry for inquiring into any matter which appears to be connected with an industrial dispute. A court of inquiry may consist of one or more independent persons as the appropriate government may thinks fit and where a court consists of two or more members, one of them shall be appointed as chairman. It is the duty of court of Inquiry that it shall inquire and report to Government within 6 months. [Sec. 6] 5. Labour Court: The appropriate Government may by notification in the Official Gazette may constitute one or more labour courts, for adjudication of industrial disputes relating to any matter specified in the second schedule and for performing such other functions as may be assigned to them under this Act. Labour Court will have only one persons to be appointed by the appropriate government. He must have the following qualifications—

(i) He is or has been a District judge of High Court.

(ii) He has been a District Judge or Additional District Judge for atleast 3 years.

(iii) He has been chairman of Labour Appellate Tribunal or any other Tribunal for not less than 2 years.

(iv) He has been served in any Judicial tribunal in India at least for 7 years.

(v) He has been Presiding officer of a Labour Court at least for a period of 5 years.

A persons who has attained the age of 65 years and in case he is not an independent person, will make him disqualify to be appointed in Labour Court. [Sec. 7]

6. Industrial Tribunals: The appropriate Government may by notification in the Official Gazette, constitute one or more industrial tribunals for the adjudication of Industrial disputes relating to any matter specified in the second or third schedule. The following shall be the qualifications of the presiding officer of a Tribunal.

(i) He is or has been a Judge of High Court.

(ii) He has been a district Judge or Additional District Judge for a period of 3 year or more. (iii) He has been Presiding officer of an Appellate Tribunal under the Act of Industrial Disputes. [Sec. 7A]

7. National Tribunal: The Central Government may by notification in the Official Gazette, constitute one or more national tribunal, consisting of only one person for the adjudication of Industrial disputes which in its opinion,

(i) involve questions of national importance.

(ii) questions of such nature that industrial establishment situated in more than one State are likely to be interested in or affected by such disputes.

No person shall be appointed as Presiding Officer of a National Tribunal unless he satisfies the following qualifications—

(i) He is or has been a judge of a High Court.

(ii) He has held office of Chairman or member of any Labour Appellate Tribunal for a period of not less than two years.

(iii) He must be an independent person.

(iv) He must not have attained the age of 65 years. Central Government, if consider proper, may also appoint two assessor to help and advice the National Tribunal in the adjudication of disputes referred to it. Casual vacancy arising in the office of Presiding officer may be filled up by the Central Government and the proceedings shall continue as usual from the stage at which the vacancy is filled up. The duties of National Tribunal are same as those of a Labour Court or an Industrial Tribunal. [sec. 7B]

8. Grievances Settlement Authority: The Industrial Disputes (Amendment) Act 1982 has introduced a new chapter 11B. In this chapter, under Section 9C, the Act provides for reference of certain individual disputes to grievance settlement authorities. According to the provisions of the above sections, the employer of every establishment in which 50 or more workers are employed or have been employed on any day in the preceding 12 months, shall provide for a grievance settlement authority for the settlement of industrial disputes connected with an individual workmen employed in the establishment.

Where an industrial dispute connected with an individual Workman arises in such an establishment, the workmen or any trade union of workmen of which such workmen is the member will referred in the prescribed manner such dispute to the Grievance settlement authority.

It has also been provided that no reference shall be made under Section 10 to any dispute referred above unless such dispute has been referred to concerned Grievance Settlement authority and the decision of such authority is not acceptable to any of the parties the dispute.

9. Arbitration: Under the provisions of Section 10-A the employer and workers agree to refer the dispute to find out settlement, they may do so by the written agreement and refer same to arbitration. The status of the arbitrator shall be considered as Statutory Tribunal. The award shall be given after making complete investigation of the referred dispute. A copy of the complete report in this regard and of the award duly signed by the Arbitrators shall be sent to the appropriate government or to the competent authority appointed by the Government. The Government will also publish the report of the arbitration in its Official Gazette within a month from the date of receipt of the report.

Industrial Disputes Act 1947

Q. 16. Distinguish between a strike and lockout. What restrictions have been imposed on strike and lockouts under the Industrial Disputes Act, 1947? Under what circumstances strikes and lockouts can be declared illegal.

[Bundelkhand Jhansi, 2012; Garhwal, 2009, 2007, 2006 B; Meerut, 1997, 1996]

Define Public Utility Service. What restrictions have been imposed on strikes and lockouts in public utility services?

[Garhwal, 2010; Meerut, 1999]

Distinguish between Strike and Lock-out. When will a strike or a lock-out is illegal? State the provisions relating to prohibition of strikes and lock-outs. [Meerut, 1990]

Ans. Meaning of Public Utility Service

(i) any railway service or any transport service for the carriage of passengers or goods by air;

(ii) any section of an industrial establishment, on the working of which the safety of the establishment or the workmen employed therein depends;

(iii) any postal or telegraph service;

(iv) any industry which supplied power, light or water to the public;

(v) any system of public conservancy or sanitation; (vi) any industry specified in the first schedule which the appropriate Government has declared to be a public utility service by notification in the Official Gazette.

The Government shall specify the period for which the industry as stated under point (vi) shall be considered to be a public utility service. The period so specified shall not exceed six months in the first instance. It may be extended from time to time not exceeding six months at any one time. [Sec.2(n)]

Meaning and Definition of Strike: Under Section 2 (q) of the Act, ‘Strike’ means:

(i) cessation of work by a body of persons employed in any industry, acting in combination; or

(ii) a concerted refusal of any number of persons who are or have been employed in any industry to continue to work or to accept employment; or

(iii) a refusal under a common understanding of any number of persons who are or have been employed in industry to continue to work or to accept employment.

An analysis of the definition of the term ‘strike’ as given above reveals the following features of a strike:

1. Cessation of Work: Cessation of work must be actual cessation of work; a mere stoppage of work on some or the other pretext would not be strike. It may extend for any duration.

Employees must cease to work voluntarily. Cessation of work is not tantamount to cessation of employment.

2. Strike is not by an individual: In order to be a strike, a group of workmen in a recognised industry must act in combination or concert to cease from working. Thus, going on mass casual leave amounts to going on strike. The refusal by workmen to work should be in respect of work which they perform normally for which they were employed. In one case, workmen refused to work en masse on the sudden death of a colleague, it was held to be a strike.

3. Strike must follow Industrial Dispute: Strike takes place after the management refuses to consider the demands in dispute of the workman. If workmen stop working because of breakdown of machinery, power shutdown or shortage of raw materials, it is not a strike.

4. Legality of Strike: Whether a strike is legal or not depends upon the conditions laid down in the Industrial Disputes Act. Right to Strike. The right to strike has been recognised in Indian industrial law. This is in keeping with the constitutional Provision to form Unions Article 19 (1) (c) of the Constitution of India States: “All citizens shall have a right to form associations or Unions.” This right, however, is not an absolute right and is subject to reasonable restrictions of the State. What is reasonable is most Cncial. There must be a sensitive balance between social control and the right of the individual. The Supreme Court studied Article 19 (1) (c) of the Constitution in the All India Bank Employees

Association Vs. National Industrial Tribunal AIR (1962) SC 171 and concluded that even if one were to very liberally interpret the Article, trade unions do not have a guaranteed right to strike as a tool in collective bargaining.

Definition of Lock-out [Section 2(1)] : Lock-out means the temporary closing of a place of employment or the suspension of work, or the refusal by an employer to continue to employ any number of persons employed by him.

Thus, lock-out is the keeping of workers away from work by the management, with a view to resisting their demands.

Therefore, there may be four ingredients of lock-out, viz.

(i) (a) temporary closing of a place of employment by the employer; or

(b) suspension of work by the employer; or

(ii) the above-mentioned acts of the employer should be motivated by coercion;

(iii) an industry as defined in Act; and

(iv) a dispute in such industry.

Difference Between Strike and Lockouts (Industrial Disputes Act 1947)

Contents	Strikes	Lockouts
Definition	Section 2(g) defines the terms strike as a cessation of work by a body of persons employed in any industry employed in any industry acting in combination or a refusal who are or have been so employed to continue to work or to accept employment.	Section 2(i) defines the term lockout as the temporary closing of a place of employment or the suspension of work or the refusal by the employer to continue to employ any number of persons employed by him.
Interest	Strike is commenced to secure interest of workers.	Lockouts are declared to protect the interest of an employer.
Focus	It is a weapon in the hands of workmen to pursue for a collective bargaining and force the employer to agree to their demands.	It is a weapon in the hands of employer to persuade by the coercive process the employees to see his point of view and make them accept his condition of service.
Aim	Strikes done to achieve the aim of better working condition and more wages.	The aim of lockout is to express inability to fulfill the demands of workers or refusal to provide employments
Occurrence	This occurs when there is a cessation of work or refusal or work by the workman acting in combination or in concerted manner in an industry.	This takes place when the employer refuses to continue to employ the workman employed by him even thought there is not intention to close drown the unit.
Penalty	When strike is illegal, penalty of Rs. 50 or imperilment for a period of 1 month or both may be imposed on every worker on strike.	When a lockout is illegal, an employer may be punished with a fine of Rs.1000 or 6 months imprisonment or both.
Result	This is applied, as a last resort when all other avenues for settlement of any industrial disputes provided by the statutory mechanism proves futile.	This is generally resorted to as a measure of security and control against the hostile workmen who one found to be indulge in sabotage.
Nature	The nature of strike is generally offensive.	The nature of lockout is defensive.
Partial or complete	Strike may be partial or complete	Lockout is always complete.

Prohibition of Strikes and Lockouts (Section 22)

Section 22 of the Act dealing with the prohibition of strikes and lockouts in public utility services states that strikes and lockouts are not absolutely prohibited in industries carrying public utility services, but certain requirements are to be fulfilled by the workmen before going on strike or by the employers before locking out their places of business, as per the provisions under Sections 22 (1) and 22 (2) respectively.

Section 22 (1) provides that no person employed in a public utility service shall go on strike in breach of contract:

(i) without giving to the employer notice of strikes within six months before striking; or

(ii) within fourteen days of giving such notice; or

(iii) before the expiry of the date of strike specified in any such notice as aforesaid; or

(iv) during the pendency of any conciliation proceedings before the Conciliation Officer and seven days after the conclusion of such proceedings.

Thus, two facts are most relevant in this regard, viz.:

(i) It does not prohibit workmen to go on strike, but requires them to fulfil certain conditions before going on strike; and

(ii) It is applicable only on public utility service and not at all on non-public utility service.

Section 22(2) lays down that no employer carrying on any public utility services shall lock out any of his places of business :

(i) without giving them notice of lockout as hereinafter provided within six weeks before lockout; or

(ii) within fourteen days of giving such notice; or

(iii) before the expiry of the date of lockout specified in any such notice as aforesaid; or

(iv) during pendency of any conciliation proceedings before a Conciliation Officer and seven days after the conclusion of such proceedings. General Prohibition of Strikes and Lockouts (Section 23) Section 23 provides for a general prohibition on strikes and lockouts applying on both public utility and non-public utility establishments. A strike is breach of contract by workmen and a lockout by the employer is prohibited in the following classes :

(i) during the pendency of conciliation proceedings before a Board and seven days after the conclusion of such proceedings;

(ii) during the pendency of proceedings before a Labour Court, Tribunal or National Tribunal and two months after the conclusion of such proceedings;

(iii) during the pendency of arbitration proceedings before an arbitrator and two months after the conclusion of such proceedings, where a notification has been issued under Subsection (34) of Section 10-A; or

(iv) during any period in which a settlement or award is in operation in respect of the matters covered by such settlement or award.

Illegal Strikes and Lockouts ( Industrial Disputes Act 1947)

Illegal Strikes and Lockouts Industrial Disputes Act 1947

Section 24 of the Act deals with the circumstances on the basis of which a strike or a lockout can be considered to be legal or illegal.

Section 24 (1) states that a strike or lock-out shall be illegal, if it is :

(i) commenced or declared in contravention of Section 22 in a public utility service;

(ii) commenced in contravention of section 23 in any industrial establishment (including both public utility and non-public utility service);

(iii) continued in contravention of an- order made by the Appropriate Government under section 10 (3); or (iv) continued in contravention of an order made under Section (4-A) of Section 10-A.

A strike or lockout shall not be regarded illegal if :

(a) It is at the commencement not in violation of the provision of the Act;

(b) Its continuance has been prohibited by the Appropriate Government under Section 10 (3) or Section 10-A (4-A);

(i) a lockout declared in consequence of an illegal strike; or
(ii) a strike declared in consequence of an illegal lockout. protection to Employees Defying Illegal Strike In any industrial establishment, as in any society, there will always be some persons who are firm in their convictions. They are not swayed by public opinion and have the courage to defy their colleagues and the union if they are convinced that the call to strike work is illegal or not for genuine demands of workers. Such workers run the risk of being ostracized. In order to meet such a situation Section 35 (1) has been incorporated in the Industrial Disputes Act.

Section 35 (1) gives protection to persons who refuse to take part in any illegal strike, so that they are not subject to—-

(a) expulsion from any trade union or society; or

(b) any fine or penalty; or

(d) be liable to be placed in any respect, under any disability; or at any disadvantage as compared with other members of the union of society.

The immunity is to prevail notwithstanding it is contrary mime rules of the trade union or society. penalty for Illegal Strike Section 26 (i): A workman who Commences, continues or otherwise acts in furtherance of a strike which is illegal under the Act shall be punished with imprisonment up to one month or fine up to 50 or both.

Q. 17. Define the term ‘Layoff” and ‘Retrenchment’ and discuss the law relating to them as obtained in Industrial Disputes Act, 1947. (Bundelkhand Jhansi, ‘2012; Garowal, 2007; Meerut, 99RPl

Or Discuss the provisions of Industrial Disputes Act, 1947 regarding retrenchment and lay-off. [Garhwal, 2008; Meerut, 2005] Ans. Layoff: According to Section 2(kkk) of the Industrial Disputes Act 1947 “lay off” means the failure, refusal or inability an employer to give employment to a workman (a) whose name borne on the muster rolls of his industrial establishment and who has not been retrenched.

An analysis of the definition of the term ‘Layoff’ as given reveals the following features of ‘Layoff’

(i) Any employer, who is William to employ, fails or refuges unable to provide employment for reasons beyond his control

(ii) Any such failure Or refusal to employ a workman may I account of.

(a) shortage of coal, power or raw material, or

(b) the accumulation of stock, or

(d) natural calamity, or

(e) any other connected reasons.

(iii) A workman who is so deprived of employment must be gud whose name is borne on the muster rolls of his industrial establishment; and

(iv) The workman must not have been retrenched.

Right of Workman for Layoff Compensation (Section 25-C)

Under Section 25-C of the Act entitles a workman to get compensation from the employer for the period he is laid off. During the period, the employer is unable to provide work to the workmen for reasons beyond his control, he owes a duty to pay layoff compensation to such workmen. In this regard, a laid off worker should fulfil the following conditions:

(i) his name must be on the muster rolls of an industrial establishment;

(ii) he must have completed at least one year’s continuous service; and

(iii) the workman must not be a badly or a casual workman. If the above requirements are fulfill end, a workman whether laid Off continuously or intermittently, she be paid compensation, which will be for all days during which he is so laid off, except for such weekly holidays as may intervene.

The Amount of Compensation

The amount of compensation shall be equal to fifty per cent of the total of the basic wages and dearness allowance that would have been payable to him had he not been laid off.

The amount of compensation for layoff is m paid subject to the following limitations : 1. If during the period of twelve months workman is laid off for more than forty-five days, no compensation shall be payable in respect of any period of the layoff after the expiry of the forty five days provided that there is an agreement between the employer and the workman to this effect.

2. Compensation is payable for a maximum period of forty five days during a period of twelve months and for a period longer than forty five days, if there is no agreement to the contrary between the employer and workman.

3. If the period of lay off exceeds forty five days the employer can either go on paying layoff compensation for such subsequent periods or retrench the workman.

4. Any layoff compensation paid to the workman during the preceding twelve months may be set off against the compensation payable for retrenchment.

Workmen not entitled to Compensation: (Section 25-E)

Section 25-E lays down the circumstances under which a laid off workman shall not be entitled to compensation. Under this section a workman shall not be entitled to compensation.

1. Refusal to accept Alternative Employment. If he refuses to accept alternative employment provided that such alternative employment is offered:

(i) In the same establishment or in any other establishment belonging to the same employer situated in the same town or village or situated within a radius of five miles from the establishment to which he belongs; and

(ii) If in the opinion of the employer, the alternative employment does not call for any special skill or previous experience and can be done by the laid off workman; and

(iii) If the wages which would normally have been paid to the workman in his previous employment are offered for the alternative employment also.

2. Absence at the Appointed Time: If he does not present himself for work at the establishment at the appointed time during normal working hours at least once a day; and

3. Strike or Go Slow in any part of the Establishment: If the layoff is due to strike or slowing down of production on the part of workman in another part of the same establishment.

Retrenchment

According to Section 2(00) of the Industrial Disputes Act 1947, “Retrenchment means termination by the employer of the service of a workman for any reason what so ever, otherwise than as punishment infected by way of disciplinary actions.”

Retrenchment does not include the following—

(i) Voluntary retirement of the workman.

(ii) Retirement of the workman on reaching this age of superannuation as per the contract of employment between the employer and the workman concerned contains a stipulation in that behalf.

(iii) Termination of service of the workman as a result of non- renewal of the contract of employment between the employer and the workmen concerned as its expiry of such contract of employment being terminated under a stipulation in that behalf contained therein.

(iv) Termination of the service of a workman on the grounds of confirmed ill health. Condition Precedent to Retrenchment of Workmen (Section 25-F) Section 25-P deals with the requirements under which the workmen can be retrenched. It lays down some specific conditions under which the workmen can be retrenched. However, these conditions apply in case of retrenchment of an employee who has been in continuous service for not less than one year. Following are the three conditions for a valid retrenchment:

(i) The workman should be given one month’s notice in writing indicating the reasons for retrenchment. Retrenchment should be effected after the expiry of the period of notice. If no such notice is given, the workman must be paid in lieu of such notice, wages for the period of notice.

(ii) The workman has been paid, at the time of retrenchment, compensation equivalent to fifteen days’ average pay for every completed year of continuous service or any part thereof in excess of six months.

(iii) Notice in the prescribed manner is served on the Appropriate

Government or such authority as may be specified by the Appropriate Government by notification in the Official Gazette, as per the Rule 76 (relating to notice Of rcLrenchrncnL) of the Industrial Disputes (Central) Rules, 1957.

Rights of a Retrenched Workman

The requirement of paying compensation is a mandatory precondition for retrenchment of a workman Therefore, its noncompliance will render a retrenchment invalid and should attract the penalty under Section 31(2) of the Act. If the retrenchment is proved unlawful, workman shall hav9 the right reinstatement with continuity of service and right too wages for such period.

procedure of Retrenchment (Section 25-G)

The basic principle of retrenchment in an industrial establishment is ‘first come last go’ and ‘last come first go’, While retrenching the workman, the employer has to comply with the procedure as laid down in Section 25-G of the Act, which should be followed strictly. It is as under :

(i) The workman must be a workman within meaning of Section 2(S) of the Act;

(ii) The workman should be an Indian citizen;

(iii) The workman should be employed in an establishment which is an industry within the meaning of Section 2 (J) of the Act;

(iv) The workman should belong to a particular category of workmen in the industrial establishment; and

(v) There should be no agreement contrary to the principle of ‘Last come first go’ between the employer and workman.

For the purpose of retrenchment, all the five conditions as mentioned above should be strictly complied with. But in case of any departure from these conditions, the reasons for the same must be recorded by the employer. Thus, any departure from the above principles is possible in two cases only, viz. :

(i) by an agreement to the contrary between the workman and the employer; and

(ii) for any other reasons to be recorded by the employer However, different judgements have held, in this regard, as under:

(i) The management in matter of retrenchment must act fairly.

(ii) The management can bonfire retain the employee possessing special qualifications whose services are necessary in the interest of business, irrespective of their seniority.

(iii) A senior employeeuul be retrenched, if there is sufficient recorded evidence of his inefficiency or irregularity.

(iv) The rule is not immutable but any departure there from must be justified by sound and valid reasons.

(v) The principle of ‘last come first go’ applies only in case of retrenchment. If there has been a genuine closure, it will not apply.