Institutions for settlement of Industrial Dispute
There are 3 institutions through which an industrial dispute could be settled as per the Industrial Dispute Act 1947. The 3 institutions are Conciliation, Arbitration and Adjudication. And each of the institutions has further bifurcation of their authorities.
Why is it important?
Everyone
would be hard hit if the industrial dispute doesn’t come to an agreement or get
resolve. Prolong periods of strikes, wages cut, job loss and lockout would be
unhealthy for the industry to sustain. Industries are pillars of the Indian
economy which needs smooth functioning. And hence the institutions for the settlement
of dispute become important. Otherwise, the consequences will be felt by the society
at large.
Conciliation
It is a process of
setting the dispute outside the court, in which both the disputed parties sit
with a 3rd party (neutral) in the view to discuss the problem and come to a
conclusion. In this form of settlements, both the parties need to compromise in
order to settle the dispute. If either of the party remains adamant then there
are high chances that the conciliation could fail. In this form, the problems
are speedily resolved, as it does not require any specific formalities or paper
works and no dates are given like court and hence conciliation directly addresses the
problem. It is like a round table discussion, where both the parties sit
together and try to reach a conclusion.
Conciliation has 3 types
of machinery which help in the settlement of the dispute. They are Works
Committee, Conciliating Officer and Board of Conciliation
Works Committee: As
per the power granted by the Industrial Dispute Act, every employer can make a
works committee (registered under the act) if they have 100 or more employees in
the organization under section 3 of the Industrial Dispute Act. It is the duty
of the committee to promote the harmony between the employer and workman. The representative
of a workman shall not be less than the representative of employer in the
committee. The representative of the employer shall be directly engaged in the
organization and should be selected with the consent of the employer's. The number
of members could not be more than 20 in the committee.
The member should have
worked for at least 1 year or have attained a minimum 19 years of age to become a member of the committee. For
voting rights, a member should have a minimum age of 18 years and must have
worked for 6 months in the organization. The central government has got the
power to dissolve the committee.
Now there are 2
authorities, designed for the conciliating proceedings.
Conciliating Officer: He
is a government representative for dissolving the dispute. His powers are
defined under section 12 of the Industrial Dispute Act. He has the duty to
mediate between the disputed parties and his power are not judicial in nature
but rather administrative. He has no power to impose an order to the parties, he can
merely request and support parties to conclude to the agreement.
He has the power to
investigate in the disputed matter. He can go to the industry without notice,
call for the documents and inquire about the incident in order to determine the
merits of the dispute. He should give his report to the government within 14
days (or shorter as decided by the government) from the date of conciliation
begins. It is the duty of the officer to conduct the conciliation in
conciliating office under an amicable atmosphere where both the parties get the
right to put their arguments. It is mandatory for the workman to submit the
notice u/s 22 of the Industrial Dispute Act for any strike or lockout,
otherwise, their action would be considered as illegal. And the time officer
receives this notice, the conciliation proceeding shall begin from the date of
notice received. And if no such notice is received then, the officer shall give
informal intimation (in written) to begin the conciliation proceedings.
The officer when the dispute comes to an end, send a memorandum to the government signed by both the parties and if the dispute is not resolved, then a failure report needs to be sent to the appropriate government within 14 days and also mention in the report all the steps taken by him in the ascertaining the facts and circumstances in order to resolve the dispute and then bringing about the settlement thereof. If the settlement arrives during the process of conciliation, then it is called a tripartite settlement, and it has to be sent to the appropriate government.
The government
then can refer the matter to the labour court or the appropriate tribunal (as
mentioned below). And if the government does not do so, then they should
communicate the same to both the parties.
Board of Conciliation: The
board as defined under section 5 of the Industrial Dispute Act, is a body for
dispute settlement, formed by the government. It compromises of 1 chairman and
2 - 4 members, as the government thinks fit. And the same shall be notified by
the government in the official gazette. The chairman shall be an independent
person and the other member shall be in equal number representing each party.
The board shall endeavor to resolve the dispute and discussion shall be
conducted in the amicable environment, where both the parties get the right to
put forward their arguments. The board will not conduct the conciliation
proceedings if the government notify the board that the service of any of the
member or the chairman itself, ceases to be available. The board has the time
period of 2 months from the date dispute was referred to it, to submit the
report to the government.
The board shall submit
its full report about the investigation conducted, ascertained the facts and
circumstances, made any findings and its reason and its opinion that why the
settlement could not have agreed along with the recommendation to the
government. And if the parties agree then the board shall send its report along
with the memorandum of settlement signed by both the parties
So, it is up to the
government if they want to send the case to the conciliating board or
conciliation officer. Normally it landed to the conciliating officer, but the
government may refer it to the board if seems required.
Arbitration
Arbitration is a process
through which the neutral third-party listens to disputed parties. It is also an outside court settlement. It is more formal and requires a proper code of
conduct (lesser than a tribunal or court but more than conciliation process). In
the Conciliation, the conciliator only assists and support the parties to come
to a settlement, and none of its order has a binding effect on the parties.
Whereas in arbitration the arbitrators listen to both the parties and then come
to a conclusion and pass the judgement. This judgement has a binding effect on
the parties. Though the judgement of the arbitrator could be challenged before
the Labour Court of the tribunal.
Arbitration has 2 types
of machinery which help in the settlement of the dispute. That is Court of
Inquiry and Voluntary Arbitration
Voluntary Arbitration: Under
section 10-A of the act, when any industrial dispute exists or is apprehended,
then the parties by themselves can go for arbitration, then the process is called as voluntary arbitration. Before referring the matter to the labour
court, if there is a written contract or if the parties agree to go to
arbitration, the case may be referred to under section 10-A of the act. The arbitrator
will be such person as mentioned in the written agreement. The
arbitrator is established by the parties mutually as per their convenience. It
is a more flexible process and speedily resolves the matter as compared to a
court or tribunal. This process because based upon mutual consent, hence prove
to maintain healthy and cordial relation between the parties and industrial
functioning. The process of arbitration is quite expensive, and cost is bear
by the parties equally. And if the arbitrator is not a good judge then he might
give biased judgement.
The copy of signed (by
both parties) arbitration agreement shall be forwarded to the appropriate
government and if the government is satisfied then within 1 month from the date
of receipt of the copy, they shall publish the copy it in the official gazette.
The arbitrator has the power to investigate into the matter and forward the arbitration
award to the government.
Court of Inquiry: Under
section 6 of the Industrial Dispute Act, the appropriate government can by way
of notifying through official gazette constitute a court of inquiry for the
purpose of settlement of the dispute by way of inquiring into the matter
concerned. There could be an independent person or multiple independent people
as deems fit by the government be appointed for the court of inquiry into a
particular matter. But where there are multiple independent people, one of them
shall be appointed as a chairman by the government. And in a situation, the government
notifies the court that the service of the chairman ceases to exist, then the
court cannot proceed in its proceedings. The court has derived the power from
section 10 (1) of the act, where it could inquire into the matter. And shall
submit its report within a time period of 6 months (or be held illegal as the
provision is a directory in nature). During the matter is pended before the
court, the workman has the right to go on strike, the employer has right to
declare lockout and the employer’s right to dismiss or punish the workmen in
accordance with the standing order or terms of the contract under section 33 of
the act for any misconduct (proviso: that no workman shall be removed unless he
has been paid wages for one month). The judgement given by the court of inquiry
is also challengeable before the labour court or the appropriate tribunal.
The quorum is 1 when the
number of members is not more than 2. The quorum is 2, when the number of
members is 2, but not more than 5. The quorum is 3 when the number of members is
more than 5.
Adjudication
Adjudication is the last
resort to the settlement of the industrial dispute. It is a legal authority
appointed by the government which has a binding effect upon both the parties. It
is a mandatory settlement of the industrial dispute. This process is generally
referred by the government when the process of conciliation and arbitration
fails.
Adjudication has 3 types
of machinery which help in the settlement of the dispute. They are Labour
Court, Industrial Tribunal and National Tribunal
Labour Court: The
Labour Court comes under section 7 of the act. The appropriate government
publish the notification in the official gazette. All the offences mentioned in
schedule 2 of the act come to the labour court. It consists of 1 person and is
appointed by the government.
The person appointed as
presiding officer of the labour court, who is or was a high court judge or has
been a district judge for a period of no less than 3 years or was a judicial
officer of India for no less than 7 years or has been presiding officer of a
labour court for no less than 5 years or has been deputy chief labour
commissioner, having a degree of law with 7 years of experience in labour
department or he has been an officer of Indian Legal Services in grade 3 for 3
years.
The court can determine
the legality of the strike or deadlocks, can determine the grant of relief to
the workmen who are wrongfully employed or discharged or can give application
for standing order (order in force until cancelled) or can interpret them.
Industrial Tribunal: Under
section 7-A of the act, the appropriate government publish the notification in
the official gazette may constitute Industrial tribunal for the dispute under
schedule 2nd or 3rd of the act. It is only constituted by
one person appointed by the government. The qualifications for the presiding
officer if same to that of Labour court (except the point of a judicial officer
of India and presiding officer of labour law).
National Tribunal: Under
section 7-B of the act the Central Government publish the notification in the
official gazette may constitute 1 or more national tribunals. So basically,
when the dispute is of national importance or it is of a situation that the
industry has been situated between 2 or more states, the case is being referred
by the government here. They are headed by only one person only, who is or was
a High Court judge. The government can even appoint 2 assessors (one who
evaluate any specific matter related to the dispute) is required to advise the
tribunal.
The validity of the Final
Judgement
As per section 17-A of
the Act, the award granted under sub-section (1) shall be final and should not
be called in question, in any court of law in any manner whatsoever. The award
shall be published before 30 days by the government and withing the expiry of 30
days from the date of such publication the award shall become enforceable and
before this period there is no liability over the head of any party to follow
the orders.
Though the central
government has the power to make the award not enforceable if they are of the
view that the judgement will be inexpedient on the public grounds, affecting the national
economy or social justice.
Power of SLP:
The supreme court has the power under article 136 of the Constitution to grant
special leave to an aggrieved party to appeal against any order passed in any
lower courts of India. as Jts. Krishnan had said that the power of the Supreme
Court under article 136 is limitless. The following article can be invoked on
the grounds of 1) when there is a miscarriage of justice, 2) when there is a flagrant
violation of the law and 3) when there is a violation of the principle of
natural justice. And it is usually the skill of lawyers to bring the question
law from the impugned order in order to reach the Supreme Court.
In the case of Sirsilk v
Govt. of Andhra Pradesh,[1] the Supreme Court held
that the government does not have the power to withhold the award from
publication. The government is bound to publish the award granted, but in some
cases where the parties go for private settlement, make the award infructuous
and government is not liable to publish it.
In another case of Amalgamated
Coffee Estate Ltd V. Their Workmen, 1965 the Supreme Court held that in case,
where the parties went for private settlement after the labour court has given
order (which was quite harsh for the parties) and the government has published it. The court said
that settlement will prevail over the award as the ultimate motive is the
settlement of the dispute by free mind.
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