Industrial Dispute: Meaning, Definitions, Forms, Causes and Settlement

Industrial dispute refers to dispute between the employers and workers. It refers to industrial unrest and conflicts. Any controversy between employers and workers is called industrial dispute.

However, it is the narrow meaning of industrial dispute. In today’s industrial milieu, the term industrial dispute has a wider connotation.

In the wider sense, industrial dispute means any kind of dispute or differences between the employer and employer; workers and employer; workers and workers. These differences or controversies may be on account of employment, conditions of work and matters concerning labour.

According to Industrial Disputes Act 1947 Sec. 21(K), “Any dispute or difference between the employers 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 labour of any person.”

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Learn about:- 1. What do you Mean by Industrial Disputes? 2. Definitions of Industrial Disputes 3. Characteristics 4. Forms 5. Causes 6. Major Impact 7. Measures to Prevent and Machinery Used for Settlement.

Industrial Dispute – Meaning, Definitions, Characteristics, Forms, Causes, Impact, Measures and Machinery for Settlement

Contents:

What do you Mean by Industrial Disputes?
Definitions of Industrial Disputes
Characteristics of Industrial Disputes
Forms of Industrial Disputes
Causes of Industrial Disputes
Major Impact of Industrial Disputes
Measures to Prevent and Machinery Used for Settlement of Industrial Disputes

Industrial Dispute – Meaning

Industrial dispute refers to dispute between the employers and workers. It refers to industrial unrest and conflicts. Any controversy between employers and workers is called industrial dispute. However, it is the narrow meaning of industrial dispute.

In today’s industrial milieu, the term industrial dispute has a wider connotation. In the wider sense, industrial dispute means any kind of dispute or differences between the employer and employer; workers and employer; workers and workers. These differences or controversies may be on account of employment, conditions of work and matters concerning labour.

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For the purpose of industrial dispute, it is not necessary that the workers must be employed. Under Industrial Disputes Act, even discharged employees have the right to put up their dispute.

Industrial disputes and conflicts have been a source of major concern because of the disruption they cause to planned economic development in a Country like ours and the losses involved for everyone concerned i.e. workers, owners, and the public. The hidden costs of strikes and the effect on industries with forward and backward linkages are difficult to measure.

Conflict is inevitable in industrial society and it should be handled carefully to ensure the viability of the organization, to remove the discontentment among workmen and to avoid hardship to the society.

Industrial Dispute – Definitions According to Industrial Disputes Act 1947 Sec. 21(K), V.P. Arya, Kurt Bran and Patterson

Industrial Disputes have been defined in various ways.

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Some of these definitions are as under:

In the words of V.P. Arya, “The term Industrial Disputes ordinarily refers to disagreements between workmen and employers relating to conditions of employment of workmen or to their non-employment.”

According to Kurt Bran, “Industrial Dispute includes differences of opinion between employers and employees or between employers and unions or between unions.”

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In the words of Patterson, “Industrial disputes constitute militant and organised protest against existing industrial conditions. They are symptoms of industrial unrest in the same way that boils are symptoms of a disordered body.”

Industrial Dispute – Top 4 Characteristics: Real and Substantial Different, Connection with Employment or Non-Employment and a Few Others

An Industrial dispute thus connotes a real and substantial difference having some element of persistency and continuity until it is resolved and if not adjudged is likely to endanger industrial peace of the undertaking or the community.

An industrial dispute must have the following characteristics:

1. Real and Substantial Different:

The term industrial dispute indicates a real and substantial difference having some element of persistency and continuity till it is resolved. If it is not resolved, it may endanger the industrial peak of the undertaking or the community. When parties are at difference and the dispute is connected with employment or non-employment or the terms of employment or with the conditions of labor, there comes into existence an industrial dispute.

2. Connection with Employment or Non-Employment:

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Every difference between an employer and his workmen which is connected with their employment or non- employment, or with the terms and conditions of their employment is an ‘industrial dispute’. The definition encompasses every dispute between the employer and his workmen, which is connected with the service of workmen or with the benefits and privileges incidental to that service.

3. Parties to the Dispute Must have Direct Interest:

The person regarding whom the dispute is raised must be one in whose employment, non-employment, terms of employment, or conditions of labor, as the case may be the parties to the dispute have a direct or substantial interest.

Even when the persons regarding whose employment a dispute is raised are not ‘workmen’, the dispute is an ‘industrial dispute, if it is raised by the workmen or the employer and they as a class have a direct or substantial interest in the persons about whose employment the dispute is raised.

4. Dispute May Relate to Production and Distribution of Material Goods and Services:

Primarily industrial disputes occur when the operation undertaken rests upon co-operation between employers and employees with a view to production and distribution of material goods, but they may arise also in cases where the co-operation is to produce material services.

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The term ‘material service’ is interpreted as those which involve an activity carried on through co-operation between the employers and employees to provide the community with the use of something such as electric power, water, transportation, mail delivery, telephone and the like. It also includes production and/or distribution of goods and services calculated to satisfied human wants and wishes inclusive of material things or services geared to celestial bliss.

Industrial Dispute – 4 Important Forms: Strike, Lock Out, Gheraos and Bandh

Industrial dispute usually arises when the employer pays no heed to the issues raised by the workers or trade union. Clash is found in the demands and interests of both the parties to the dispute. Under industrial disputes workers and employers express their opposition in different ways.

Different forms of industrial disputes are described as under:

Form # 1. Strike:

Strike is a stoppage of work. It refers to a situation when workers leave the place of work or go out of the factory and stop work. Thus, the work is temporarily stopped and production comes to a standstill. According to Industrial Disputes Act, strike means refusal to do work collectively by persons working in an industry or refusal to do work unanimously by those persons who are appointed to do work.

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Following are the main features of strike:

(i) Strike is organised by the trade union. If an organisation has no trade union and some employees stop work even then it is treated as strike.

(ii) It is essential under strike that workers stop work collectively. If one person does not do the work, it is treated as violation of the order and not strike.

(iii) During strike employer and employee relation remains intact. Stoppage of work or not doing work or refusing to do work, due to any reason, means strike.

(iv) During strike it is not necessary that worker should leave the place of work or the organisation. These days, due to various forms of strike, the workers may proceed on strike even while working.

It can thus be said that strike is the outcome of clash of interests of workers and employers. These days, every section of the society, takes resort to strike to safeguard its interests. Strike also assumes various forms.

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These are discussed as under:

(i) Token Strike:

This kind of strike takes place when the workers want to attract the attention of the employer to a given problem. It is usually for one day. If the employer fails to solve the problem, it is followed by formal strike.

(ii) Strike and Work According to Rule:

Under this kind of strike, workers continue to do work according to Rule and at the same time express their protest also. Bank employees and personnel of Civil Aviation Department usually resort to this kind of strike.

(iii) Go Slow Strike:

Under this form of strike, workers continue to work but not to their full capacity. By slowing down the speed of work they try to compel the employer to concede to their demands.

(iv) Sympathy Strikes:

Such strikes are not for any of their particular demands but are intended to extend moral support to those unions whose workers are on strike. Through such strikes Trade Unions demonstrate their Solidarity.

(v) Hunger Strike:

It is the most prevalent form of strike. Under it, workers starve themselves and thereby put pressure on the employer to get their demand conceded.

Usually, hunger strike is meant to get any decision withdrawn by the authorities. Trade Unions, leaders and other classes of the society resort to this kind of strike.

(vi) Pen down Strike:

Under this form of strike, workers go to their work-place but do not work. They sit idle at the desk. It is also a widely prevalent form of strike.

Form # 2. Lock Out:

Just as worker-class resort to strike to get its demand accepted, likewise employer-class has also a weapon in its armoury to cow down the workers. This weapon is called “lock-out”. In case of lock-out, an employer shuts down the factory premises till such time as the workers accept his conditions. The purpose behind lock-out is it to pressurize the workers to accept the terms of the employer. Under it, the employer either stops or suspends the work, in one way or the other.

On acceptance of his demand, the organisation is re-opened. If the employer closes down the factory for good, it cannot be termed as lock-out, because such a closure is not associated with any demand or its fulfilment. Thus, lock-out implies that employer is capable of providing re-employment or carrying out production or asking the workers to re-join the work on opening afresh of the organisation.

Thus, when workers’ demands are not fulfilled or when they are exploited, then they take recourse to strike. On the contrary, when workers put up unreasonable demands or try to exploit the employer, then employer also pays them in the same coin by using an equally effective weapon of lock-out.

Form # 3. Gheraos:

The term ‘Gherao’ in Hindi language means to “surround” or “besiege”. It is a special form of strike. Under it, the workers surround the employer in order to get their demands accepted. They lay besiege, around the office of the employer or manager and do not allow him to come out till their demands are accepted or assurance to this effect is given. Handful of workers are considered sufficient for this purpose. Normally, gherao is for a short while. The atmosphere is surcharged with tension and there is apprehension of violence as well during the period of gherao.

Form # 4. Bandh:

Trade Unions resort to bandh when an industrial dispute reaches its extreme edge. When the employers fail to find any solution to a problem or dispute and strike also fails to serve its purpose, then the weapon of bandh, an aggressive form of strike, is let loose. Under it, trade unions try to get the work of all industrial establishments stopped at the district or state level to get their demands fulfilled.

In this situation, it is the serious effort of the trade unions to ensure that different industrial institutions, non-industrial institutions, schools, colleges, commercial establishment of the town or the state should remain closed, so that employers could be pressurised. Bandh is an aggressive form of strike. This extreme measure is used by different trade unions in our country, in order to make their campaign a success. Many a time, to oppose the enforcement of any government decision, country-wide bandhs are organised by political parties or Central Trade Unions.

Strikes, lockouts and gheraos due to industrial disputes between the period 2011 and 2012, the number of workers involved in each and the number of mandays lost, in detail. It is significant to note that during this period number of strikes, and workers involved has increased. There is steady fall in number of lockouts and manday’s lost due to this reason. The number of lockouts and mandays lost due to this reason has increased.

Industrial Dispute – 3 Categories of Causes: Economic Causes, Managerial Causes and Government Machinery

The new industrial set up has given birth to the capitalistic economy which divided the industrial society into groups of labour and capitalists. Capitalists own resources and have possession over means of production on the other hand, labour sells services which cannot be stored.

The interests of the two groups are-not common. One strive for higher wages and congenial working conditions whereas the other takes advantage of workers’ poor bargaining power and deny them their due rights. Besides, the employers want higher productivity. When these two conflicting interests clash, industrial disputes arise.

Although there are multitude of cause’s blended together, result in industrial disputes, it is not easy to ascertain the particular cause or causes involved. Surface manifestation of work stoppage may cover deep-seated and more basic causes which cannot be observed at first sight. Moreover, the relative importance of the causes, when more than one are present, is often very difficult to gauge.

It has been observed by the experts of industrial relations that the cause of conflict between the two parties are the same in all capitalistic economy.

There are a number of causes for industrial disputes which can be classified into three categories as follows:

1. Economic causes,

2. Management’s attitude to labour,

3. Government machinery,

1. Economic Causes:

Really, the most common causes of industrial disputes are economic causes.

These are as follows:

(a) Wages:

The demand for wage increase is the prime- most cause of the industrial disputes. A large number of strikes are being organised to raise a voice against the rise in prices and cost of living. The real wages of the workers decline faster with the increase in price level and they feel dissatisfied with their present emoluments and struggle for the improvement in wages.

By having a cursory glance on the history of industrial disputes, it becomes clear that cause of most of the industrial disputes was wages. The Indian employer have no clear-cut and enlightened wage policy. Most of the industrial disputes were the result of a demand for higher wages.

(b) High Industrial Profits:

During and after the world wars, prices of the commodities went up and the industrialists earned huge profits. In order to get share in the prosperity of the industry, it naturally led to the resentment on their part. The increased profits also led to the demands of higher wages and bonus. Now in the changing world, concept of labour has changed considerably. They think themselves as a partner of the industry and demand their share in the profits.

(c) Dearness Allowance and Bonus:

Increase in cost of living was the main cause of the demand of dearness allowance by the workers to equate their wages with the rise in prices. Bonus also play an important role as a cause of industrial dispute. It is interesting to note that in 1966, 49 percent of the disputes were related to wages and bonus.

Both the quantum and the method of bonus payment has led to a number of disputes. There is an increasing feeling among the workers that they should have, a greater share in the profits of the concern and this fact has not been recognised by the employees and non-acceptance of this fact has been a source of friction among employers and employees.

(d) Modernization and Automation of Plant and Machinery:

The attempt at modernization and introduction of automatic machinery to replace labour has been the major cause of disputes in India. Workers go on strike, off and on, to resist rationalization and automation. A strike in cotton textile industry in Kanpur in 1955 is an example of such disputes. Workers in Life Insurance Corporation went on strike recently against introducing computers in the corporation.

(e) Working Condition and Working Hours:

The working conditions in Indian industries are not hygienic. There is not ample provision of water, heating, lighting, safety etc. Working hours are also greater. The demand of palatable working conditions and shorter hours of work are also responsible for labour disputes.

(f) Demand for Other Facilities:

Demand for other facilities for meeting out their basic needs such as medical, education, housing, etc., encourage the workers to resort to direct action because such facilities were denied by the employers.

2. Managerial Causes:

These causes include autocratic managerial attitude and defective labour policies etc.

(a) Denial of Recognition to Trade Unions:

Failure on the part of the employer to recognise the trade unions or to recognise the rival union for representation, insult of trade union leaders by the employers are some of the examples of autocratic managerial attitude worth mentioning as the causes of industrial disputes. The attitude of employers towards the labour associations had never been sympathetic. They want to divide them and rule.

Moreover, the management is generally not willing to talk over the dispute with the workers or workers’ representatives or refer it to ‘arbitration’, even when the workers are willing to do so.

(b) Defective Recruitment Policies:

The recruitment practices in Indian industries are defective. Recruitment is generally made by the contractors who exploit the workers and suppress their individuality. The defective promotion, demotion, transfer and placement policies encourage dissatisfaction among workers.

(c) Irregular Lay-off and Retrenchment:

Lay-off and retrenchment are reasons to be mentioned for encouraging industrial disputes. Indian employers follow the policy of ‘Hire and Fire’. As a matter of practice, workers are not made permanent for a pretty long time to deprive them of their legitimate rights.

(d) Defiance of Agreements and Codes:

The employers regularly defy the provisions of collective bargaining agreements and code of conduct and code of discipline with a view to harass or exploit the employees and just encourage strife.

(e) Defective Leadership:

Inefficient leadership is also one of the causes of disputes. Leadership from the management and from the workers are quite incompetent to induce the workers to get them worked. The employers’ representatives are not delegated sufficient authority to negotiate with the workers. They are not in a position to commit anything to workers on behalf of the management. Defective management leadership ignored the labour problems and inefficient labour leadership could not coordinate the efforts of their fellow members, so disputes arise.

3. Government Machinery:

Government measures to prevent and machinery to settle the disputes are not much effective.

There are two examples:

(i) Enactments are Ineffective:

Though there is a plethora of enactments for promotion of harmonious industrial relations, yet it is ineffective and unsatisfactory in most cases due to:

(a) The irrelevancy in the context of the challenges of present industrial climate/culture, as many have not been convinced of their utility satisfactorily;

(b) Improper and inadequate implementation by many employers;

(ii) Little Confidence over Settlement Machinery:

Both employers and employees have little confidence over the Conciliation Machinery as it could succeed in settling a very negligible number of disputes so far. Both employers and employees are litigation-minded. Moreover, the settlement machinery is quite inadequate because, it has to see whether labour laws are properly being implemented or not.

Other Causes:

Among these may be included the following:

(i) Almost every trade union in India is affiliated to one or the other political party. Political parties or political ideologies govern these trade unions. Each party, therefore, engineers strikes, gheraos and bandhs to demonstrate its political strength. The trade union, affiliated to a party in power gets preferential treatment. This leads to industrial disputes.

(ii) Trade unions In India are weak. They, invariably fail in safeguarding the interests of workers.

The reasons for this state of affairs are:

(a) Multiplicity of trade unions in the same industry/unit and rivalry among the workers have destroyed the solidarity of the working class.

(b) In some undertakings, there is no union at all recognized or unrecognized. They have not been allowed to form a union, and therefore, they are deprived of their right of collective bargaining. Hence workers in non-trade union undertakings, resort to direct action.

(d) Trade union leaders, themselves aim at fulfilling ulterior motives leading to thwarting the attempts of trade union unity.

(iii) Political instability, Centre-State relations, general responsibility or all fronts are reflected in industry resulting in industrial conflict.

(iv) Other potential factors such as rampant corruption in industrial and public life, easy money, conspicuous consumption, permissive society, character crises and general break down in the national morale have brought in their train debasement of social values and social norms all these can and have perpetuated all kinds of unrest, including industrial unrest.

Thus, industrial disputes are the result of so many causes. Sometimes, a number of causes collectively contribute to the dispute. All the actors of industrial relations viz. employers, workers and the Government, in maintaining industrial peace must try to redress any grievances before it takes form of a dispute.

Industrial Dispute – 5 Major Impacts: Production and Services, Employers, Workers, Society/Public and National Economy

An industrial dispute can never be said to be a good choice. Consequences of industrial disputes are very far reaching, for they disturb the economic, social and political life of a country. They are no less than a war. In a war, casualties and sufferings are not confirmed to soldiers fighting on the front, so stoppage of work due to strike or any other mode resulting in stoppage of work does not affect the employees or the employers of the struck plant, but it affect the whole society or country.

Though it initially starts locally, a war has every possibility to engulf the entire humanity, so, industrial disputes may and do occasionally assume proportion affecting the entire economy. Strikes etc., in basic industries are more harmful engulfing the whole economy. It is like a big stone thrown into a pond causing ever widening waves till the entire pond is engulfed. Naturally industrial disputes cause sufferings to the nations, community, employers and employees, consumers etc., in more than one ways.

Impact # 1. On Production and Services:

The industrial disputes result in huge wastage of man-days and dislocation of production work. A strike in public utility concerns like water and electric supply units, posts and telegraph or telephone’s services, railways or roadways, any system of public conservancy or sanitation, hospitals, defence establishments etc., disturbs the whole public life and throws the economy out of gear. Consumers are subjected to untold hardships. If the struck commodity happens to be used in other production operations, then other producers also suffer.

When industrial dispute results in stoppage of work, supply position of the struck commodity becomes grim and prices of that commodity shoot up. The position becomes severe if the product is consumer goods of daily use.

Impact # 2. On Employers:

The employers also suffer heavy losses, not only through stoppage of work, reduction in sale and loss of market due to none or short supply of the product, but also in the form of huge expenditure on crushing down the strikes. They have to undertake publicity and propaganda to put their view point before the public. They lose their mental peace, respect and status in the society.

Impact # 3. On Workers:

The workers are also badly affected in more than one ways. They lose their wages for the strike period. Sometimes, they lose their employment. They have to incur debts to meet their day-to-day expenses. Future prospects become dim. Disruption in family life, personal hardship, mental agonies, tortures, and tensions develop and persist.

The workers are prosecuted, often intimidated, even victimized or beaten mercilessly by goondas, repressed by police. If strikes etc., fail, the workers, besides inflicting financial loss, are demoralized, disappointed and shake their confidence in trade unions.

Impact # 4. On Society/Public:

The public/society too, is not spared. Industrial unrest creates law and order problem, ceasing a huge additional expenditures out of public exchequer. Further, even when the disputes are settled, strife and bitterness continue to linger endangering happy social and industrial relations.

Impact # 5. On National Economy:

The industrial disputes also affect the national economy adversely when labour and equipment in the whole or any part of the industry are rendered idle by strike or lock-out, national dividend (income) suffers a lot. It may happen in two ways on the one hand, by impoverishing the workers indulging in the stoppage of work, it lessens the demand of goods produced by other industries on the other hand, if the struck industry is such that supply goods and services to other industries, it lessens the supply of them of raw material or equipment to work. The result is loss in production, ultimately reducing the national income. Consequently, public expenditure on welfare of public is reduced. Developmental activities cannot be undertaken for want of finances.

In nutshell, the impact of industrial disputes is not good irrespective of the fact who succeeds—employer or employees. Each group employers, employees, consumers, society and the economy suffers in one way or the ether. So, industrial disputes should be avoided, by the interested parties, threshing out their differences through collective bargaining and voluntary arbitration. Stoppage of work should be the last- resort if all other measures fail.

Industrial Dispute – Measures Adopted to Prevent Industrial Disputes and Machinery Used for Settlement

Wisemen say, “Prevention is better than cure.” Instead of seeking solutions to the problems after the same have gathered momentum, it is far better not to let the problems crop up in the first instance. Although it is not possible to completely eradicate industrial disputes or conflicts, yet efforts can be made to minimize them.

If employers adopt rational policies, most of the disputes can be prevented. Causes of industrial disputes (economics, social and political) should be properly analysed and serious efforts made to remove them.

Following measures are adopted to prevent industrial disputes in our country:

(1) Works Committees:

If an establishment has 100 or more workers employed or have been employed on any day in the last 12 months, then the appropriate government can direct its employer, by a special order, to appoint works committees. These committees are established to discuss matters of mutual interests between the employer and the workers. These are composed of an equal number of employers’ and employees’, representatives. Main objective of the Works Committees is to develop a spirit of co-operation and partnership.

Its main functions are to enquire about the problems arising out of day-to-day working of the establishment and dissatisfaction among the workers and to remove the causes of friction between workers and managements.

(2) Standing Orders:

Generally, industrial disputes arise because of lack of clarity in the terms of employment. Contradictions in the terms of employment or ambiguity therein or their wrong interpretation lead to industrial disputes. In order to prevent the industrial disputes, it is therefore essential that terms of employment, termination, discipline etc. should be made clear in the very beginning. Their promotion, mode of payment of wages etc. if made clear initially, it would help prevent disputes.

Terms and conditions of employment and work should be got approved by the representatives of workers or the trade unions and a copy of the same be submitted to the government authority. Once approved by both the concerned parties these will constitute standing orders of the establishment or enterprise. It will then be the bounded duty of the workers and management to abide by these terms.

(3) Strong Trade Unions:

Strong and well organised trade unions play an important role in preventing industrial disputes. If a strong trade union exists in the organisation, it would not be possible for the employers to exploit the workers. The employers would be afraid of doing any wrong thing. Their approach turns human and just. Realising their responsibility even trade unions leave the path of strikes, sabotage, protests etc. and make efforts to settle disputes through mutual dialogue with the employers in an atmosphere of cordiality.

Thus, workers should give up selfish motives and work unitedly to safeguard their interests.

(4) Wage Board:

The most important cause of industrial disputes has been wages. Workers continue to persist in their demand for higher wages and employers continue to ignore the same. It leads to dispute between them. It is essential to have a strong provision / policy to determine the wages of the workers. Setting up of a Wage Board, in this context, can be an effective step. Government of the country can play a positive role in this context. It can set up a Tripartite (representatives of workers, employers and government) Wage Board.

Its main function would be to fix reasonable wages of different kinds of workers from time to time and take necessary measures in this context in accordance with country’s economy.

(5) Workers’ Participation in Management:

Main objective of workers’ participation in management is to give due importance to the workers in the management of industrial units. It generates a feeling of belonging among the workers and they consider themselves to be a part of the organisation. When workers are made a part of the decision-making process, their grievances begin to diminish. Thus, chances of dispute are minimised.

(6) Joint Management Councils:

Such councils are formed voluntarily by the employers and not under any compulsion or legal requirement. Workers are included in different councils by the organisation, e.g., Safety Council, Welfare Council, Production Council, etc. The purpose of these councils is to arrive at an effective decision by removing differences on different matters. This system can also prevent unnecessary disputes.

(7) Grievances Redressal Procedure:

When the worker class feels ignored, it constitutes a cause of dispute. When their just demands/problems are not met by the employer, the workers adopt the path of agitation. Disputes can be minimized if proper provision is made by the organisation to hear or solve their grievances.

(8) Profit Sharing:

Workers complain from time to time that they do not get fair share of the profit of the organisation. They are also dissatisfied on the score that instead of treating them as partners in production they are treated merely as a tool in the machine by the employer. Under the system of profit sharing, workers get some share out of the profit, in addition to their normal wages.

This share is mutually agreed upon by both the parties. It strengthens mutual amity. Workers have the feeling that they are not labourers but an important part of the industrial unit. This way, industrial disputes are reduced.

(9) Labour Welfare Officer:

There is a provision in the Factory Act that appointment of a Labour Welfare officer in mandatory is all those units where 500 or more workers are employed. His main function is to develop cordial industrial relations by establishing contact with the employers and managers. Besides, his functions also include enquiring into dissatisfaction among the workers and bringing the same into the knowledge of the employers and making efforts to prevent the disputes from arising.

Thus, labour welfare officer can prevent a dispute from occurring by taking necessary preventive measures.

(10) Code of Discipline:

To maintain discipline in industrial units, code of discipline is also made use of. On the basis of bi-partite or tripartite settlements by the employers and the workers, their rights and duties are codified. As a result of it, both employers and workers remain fully aware of their responsibilities. It succeeds to a large extent in checking labour agitations.

With a view to preventing industrial disputes although different measures are adopted, yet they fail to stop the same completely. In one from or the other, these disputes do re-emerge. To maintain industrial peace, solution to these problems must be found at the earliest.

The provisions made in Industrial Disputes Act to settle these disputes are referred to as “Machinery for settlement of Industrial Disputes”.

These provisions are divided into two parts:

(A) Enquiry into the Matter of Disputes

(B) Settlement by Court.

(A) Enquiry into Causes of Disputes:

Following provisions have been made to enquire into the causes of Industrial Disputes:

(1) Works Committees:

The Act provides for setting up of Works Committees in all those industrial units employing 100 or more workers currently or in the past 12 months, on a special order issued by the concerned government. It consists of equal number of representatives of the employer and employees. Its main objective is to encourage spirit of co-operation and partnership between the employer and the employees.

It enquires into problems arising out of day-to-day work, dissatisfaction among the workers and in the event of likelihood of any dispute it makes attempt to conciliate between the two parties. If there is no proper representation of the workers in the committees, the latter has no relevance.

(2) Conciliation Officers:

By a notification, the relevant government may appoint a conciliation officer who will act as a mediator to get the dispute settled. His appointment may be permanent or for a fixed period. A conciliation officer may be appointed for a particular industry or a particular area. The nature of his job is administrative and not judicial. He is to enquire into the cause of dispute, make an attempt to conciliate between the parties concerned and find a way out to prevent the dispute from aggravating.

He is to ensure cordiality in relationship between the two parties and is to pave the way for industrial peace. Once the settlement is arrived at, he gets the conciliation papers signed by both the parties and submits the same, with his report, to the relevant government. In case he is unable to get the dispute settled within 14 days, he submits a detailed report to the government indicating the prevailing circumstances between the concerned parties, the efforts made by him and causes of failure of his attempts.

(3) Conciliation Board:

Conciliation Board is appointed subsequent to the failure of conciliation officer in his attempts and the dispute becoming a complicated matter. Under the circumstances, a conciliation Board is appointed by the relevant government through a notification. Equal number of representatives of workers and employees are appointed as members on the board. It is headed by a chairman.

If any party to the dispute does not appoint its representative, within the specified period, then the government is empowered to appoint any person as its representative. The Conciliation Board will enquire into all matters relating to the dispute and make efforts to get both the parties to come to an amicable settlement. If it succeeds in its efforts, it will get the memorandum of conciliation signed by both the parties and submit the same along with its report to the relevant government.

If no settlement is reached, the Board will submit its report within two months to the government giving all the circumstances and causes accounting for the failure of Board’s attempts.

(4) Court of Enquiry:

With a view to enquiring into any matter relating to industrial dispute, the relevant government can institute a court of enquiry by issuing necessary notification. It consists of one or more than one person. If there is more than one person, then one of them is appointed as chairman. The court is to confine itself to enquire into the dispute and not to pass any judgement.

Court of Enquiry will enquire into all those matters which are referred to it. The court will submit its report to the concerned government within six months. The proceedings of the court of enquiry will be treated as court proceedings under Indian Penal Code (IPC).

(B) Settlement by Court:

All the above provisions are meant to enquire into the causes of industrial disputes and to make attempts to settle the same through negotiations. Some of the disputes are settled by these provisions; but, at times, these provisions do not succeed in their aim.

In order to settle such disputes following provisions have been made in Industrial Disputes Act:

(1) Labour Court:

Concerned government can appoint labour court for adjudication on any matter given in schedule 2 of Industrial Disputes Act. It will consist of only one person who is appointed by the government. The presiding officer of a Labour Court is one who has been a Judge of any High Court or has been District Judge for at least three years or has been a judicial officer in any court in India for at least 9 years or has been presiding officer of a Labour Court for at least 5 years.

Labour Courts will hear matters relating to industrial disputes in the same manner as a court of law and pronounce its judgement. Labour Court will give its decision on the following matters referred to it.

(i) Suitability or legality of orders issued by the employer under Standing Orders.

(ii) Effectiveness of Standing Orders.

(iii) Matters relating to appointment, dismissal, re-appointment and compensation.

(iv) Withdrawal of any existing concession or privilege.

(v) Legality or otherwise of strikes or lock-outs.

(vi) Other matters referred to it.

(2) Industrial Tribunal:

It is another important provision of the Act to settle industrial disputes. One person alone is appointed as the presiding officer of the Tribunal. To be eligible for appointment he must have served as District Judge for at least 3 years or a Judge in the High Court. If the government so desires, it may also appoint two persons as Assessors to advise him.

Industrial Tribunal can give his judgement on the following matter:

(i) Period and method of payment of wages.

(ii) Compensation and other allowances.

(iii) Hours of work and rest.

(iv) Leave with pay and public holidays.

(v) Amount of Bonus, Provident Fund and Gratuity.

(vi) Disciplinary activities.

(vii) Rationalisation.

(viii) Retrenchment of workers and closing down of the organisation.

(ix) Working of Shifts.

(x) Pay Scales.

(xi) Other mattes referred to it.

The Tribunal will complete its proceedings expeditiously and give its decision within the specified time period. The government concerned will publish it within 30 days of its receipt. Thirty days after its publication it will come into force.

(3) National Tribunal:

Those matters which the central government considers to be of national importance are referred to National Tribunal for adjudication. Central Government appoints National Tribunal in those cases which affect industrial establishments of more than one state. It also comprises of one person. He should be or should have been a judge of the High Court or he should have served Labour Appellate Tribunal for two years as a member or chairman.

National Tribunal gives its decision within a specified period after completion of all proceedings. Concerned government will publish it within 30 days after its receipt. Decision so published will be final and no judicial court will object to it. The decision will come into force after 30 days of its publication.

(4) Arbitration:

It is a system under which any disputed matter can be referred to an impartial person for arbitration. Written consent of the parties to the dispute is essential. Under arbitration equal number of arbitrators are appointed by both the parties, or, if they so desire, there may be only one arbitrator. The arbitrators enquire into the matter and submit their award to the concerned government, the award is signed by all the arbitrators. Arbitration may be voluntary or compulsory.

i. Voluntary Arbitration:

When both the parties fail to settle the dispute mutually and thorough conciliation, it is referred to an impartial arbitrator. Both the parties volunteer to accept the award. Before referring the matter for voluntary arbitration consent of both the parties is essential.

ii. Compulsory Arbitration:

In case, both the parties fail to arrive at any settlement by voluntary arbitration then the matter is referred for adjudication by compulsory arbitration. The arbitrator has full authority to enquire into the dispute. The award given by him has got to be accepted by both the parties. It is what compulsory arbitration implies. Non-acceptance may invite penal action against the parties concerned.