Authorities for Settlement of Industrial Dispute under Labor Law

Introduction

As Industrial Dispute between employer and employee is main concern in today’s scenario. Various authorities for the settlement of such dispute has been established under Industrial The main object of the Industrial Disputes Act is Investigation and settlement of Industrial Disputes. With that object in view various authorities have been created under the Act. The Act provides for the following authorities for the settlement of Industrial Disputes.

• Voluntary Settlement and Conciliation
• Adjudication with the help of courts
• Arbitration with the help of third persons

1. Conciliation

Conciliation is a method of discussions or negotiation through which the parties to the dispute voluntary reach amicable settlement acceptable to both the parties. The discussions and negotiations between the parties may be initiated by the parties themselves or with the efforts of third party neutral to the dispute. The third-party act like a mediator who mediates in and promotes the settlement of the dispute.

Features of conciliation

Parties to the dispute come to settlement voluntarily and not under any compulsion or coercion. Conciliation preserves amity and good relations between employer and the workmen as conciliation is an out of court settlement.

Authorities for the conciliation under Industrial Dispute Act 1947 — Authorities under the act

• Work Committee (Section 3)
• Conciliation Officer (Section 4)
• Board of Conciliation (Section 5)
• Court of Enquiry

Work Committee

• Constitution
  • Section 3 of the act empower the appropriate Government to constitute a work committee by a general or special order in the manner which may be prescribed.

There are two conditions which must be satisfied before a work committee can be constituted–

1. The establishment must be an industrial establishment
2. One hundred 0r more workmen should either be presently employed or should have been employed on any day in the preceding twelve months.

• The work committee must be composed of the representatives if employers and the workmen engaged in the industrial establishment and must be equal in number and be chosen in prescribed manner.
• The representatives of the workmen are chosen from among the workmen in consultation with their Trade Union.

Functions and Duties of Work Committee

• To promote measure for securing and preserving good relations between the employer and his workman.
• The works committee shall meet and discuss matters of common interest and make efforts to settle differences. For instance matters concerning their welfare, training, wages, hours of work , bonus , holidays with pay etc.
• The success of such committee lies in the efforts of both the parties.
• They are viewed as a prevention which us better than cure.

Conciliation Officers

• Appointment :Section 4 empowers the appropriate government to appoint .

Such number of persons , as thinks fit as conciliation officers

• A conciliation officer may be appointed for a specified area or for specifued industries
  • Either permanently or for a limited period .
  • The act makes conciliation compulsary in all disputes in public utility devices and optional in other industrial establishments .

According to section 11(6) of the Act , a conciliation officer is deemed to be a public servant with the meaning of section 21 of Indian Penal code .

Functions of conciliation officers –

Provide such solution which is acceptable to both the parties. Rather than to determine the rights and wrongs of a problem.

Position of Conciliation Officer

• A conciliation officer is an independent agency
• With a view to promote industrial peace
• By making available governmental facilities in the process of collective bargaining
• He has to investigate the dispute and di all such things
• As he thinks fit for the purpose of inducing the parties
• To arrive at a fair and amicable settlement of dispute
• A conciliation officer cannot make a final decision if both the parties is not agree

Duties of Conciliation officer :

Section 12 deals with the duties of the conciliation officer :-

• May hold conciliation proceedings in the prescribed manner,: however if industrial dispute relating to a public utility service where notice under section 22 which is about Strike or lockouts has been given than the conciliation officer shall hold conciliation proceeding I’m respect of it and also investigate the matter regarding dispute.

But where notice of strike and lock out is not given , the conciliation officer has discretion to decide whether or not to hold conciliation proceedings

• Investigation of matter without delay Section 12 (2). This section empowers him to do all such things as he thinks fit for the purpose of inducing the parties to arrive at a fair and amicable settlement of dispute.
• Where the Conciliation Officer succeeds in bringing about a settlement — He is required to make a report to the appropriate Government With a memorandum of settlement signed by the parties to the dispute
•  If the efforts to bring about settlement fail –– Then the conciliation officer is required to make a report to the appropriate Government mentioning about all the facts and circumstances due to which settlement could not be arrived at.
• If after submission of the above report to the Government — The parties approach him or if he feels that the parties are in mood relent or reconcile to reach up at settlement, it would be perfectly open to him to initiate, afresh conciliation proceedings to bring about settlement of the dispute.
• The conciliation officer must submit the report within 14 days of the conciliation proceedings or within such shorter period as may be fixed by the appropriate Government .
  • The period for submission of the report can be extended by the agreement of the parties subject to the approval of conciliation officer.
  • If on consideration of the report submitted by the conciliation officer and the appropriate government is satisfied than he can refer the case to any other authority under the act.

Board of Conciliation

Constitution – Section 5 empowers the appropriate government to constitute board of conciliation

• By notification in official gazette
• The Board is appointed for promoting the settlement of industrial disputes
• The board shall consist of a chairman and two or four other members as the appropriate government thinks fit.
• The chairman of the board must be an independent person.
• The members have to be appointed on the recommendation of the contending parties. Where any party fails to make recommendations within the prescribed time the appropriate government shall appoint members.
• For conducting the proceedings, it is not necessary that all the members may not be present.
  • The quorum for meeting is two where the number of members is three
  • And three where the number of members is five
  • But if the appropriate government notifies that the services of the chairman or any other member have ceased to be available
• A board is appointed as and when a dispute arise . It is not a permanent body.

Reference of Dispute –

• Where the parties to an industrial dispute apply in the prescribed manner
• For a reference of the dispute to a board and
• The appropriate government is satisfied, they shall make the reference accordingly
• Where an industrial dispute has been refer to a board then the appropriate government may be order prohibit continuance of
  • Any strike or lockout in connection with such dispute.

Duties of Board

Section 13 (1) imposes a duty on the board

• To make efforts to bring about a settlement of the dispute referred to it.

1. The Board is required to investigate without delay : The board is also given the power to do all such things as it thinks fit for the purpose of inducing the parties to come to a fair and amicable settlement. It should be noted That :
   • Whereas a conciliation officers may hold conciliation proceedings as soon as an industrial dispute is found to exist.
   • But Board can act only if a reference has been made to it by the appropriate government
2. If a settlement is arrived at : the Board is required to send a report to the appropriate government. Together with a memorandum of settlement duly signed by the parties to the dispute.
3. In the event of failure : The board is required to send a failure report to the appropriate government.
   • The report is required to contain full statement of the words findings thereon. The reason for which a settlement could not be arrived at
   • And its recommendation for the determination of the dispute.
4. The board must submit its report within two months from the date on which the dispute referred to it. Or such shorter period as may be fixed by the appropriate government.
   • The appropriate government may extend the time for the submission of the report by not more than two months in aggregate.

Conciliation officer compared with Board of Conciliation

It will be seen that where conciliation fails, Board of Conciliation takes over. The functions of the Board are the same as those of the conciliation officer. But there are certain differences between two which are as follows:

1. The conciliation officer is an individual public servant While the board consist of three of five persons
2. The conciliation officer may be appointed for specified area or for specified industries. However, no such provisions exist in the case of the Board.
3. The conciliation officer holds the conciliation proceeding of his own accord. But the machinery of the Board is set in motion when a dispute is referred to it.
4. If no settlement is arrived at , the conciliation officer is required to send a report stating the facts and circumstances, the steps taken and the reasons why no settlement was arrived at.
5. In additions to his duty of conciliation officer, the board has to suggest the remedy for the determination of the dispute.
6. The time for the submission of the report -In the cases of conciliation proceedings by the conciliation officer in 14 days while it is 2 months in the case of the Board.
7. The members of the Board of conciliation act in a judicial capacity and enjoy more powers than conciliation officers.

Court of Inquiry

Constitution :

• Section 6 empowers the appropriate government to constitute a court of inquiry for entering into any matter appearing to be connected with or relevant to an industrial dispute.
• The constitution of court of Inquiry is required to be notified in the official gazette
• A court of inquiry may consist of one or more independent persons
• If the number is more than one, one of them shall be appointed as chairman.
  
  Duties : Section 14 deals with the duties of the court of inquiry :
  
  • The first duty of the court is to enquire into the matter referred to it .The second duty of the court is to make a report to the appropriate government on the inquiry held by it.
  • This report is ordinarily required to be submitted within a period of six months from the commencement of the inquiry
  • The word “ordinarily” appears to be indicated that the period can be extended
  • The report of the court of inquiry is required to be published by the appropriate government under section 17.
  • The object of the court is to inquire into and reveal the causes of an industrial dispute
  • It is not more than a fact-finding machinery.

2. Adjudication

Method of adjudication settlement of an industrial dispute via adjudication by adjudication is a compulsory method of settlement of the dispute. The adjudicatory authority after hearing both the parties considering the merits of the dispute and material on record determines the rights and duties of the parties to the dispute and give its award.

The award of the adjudicatory authority is final and binding on the parties if it is not appealed against to the appellate authority by the aggrieved party, who is not satisfied with the award.

Industrial disputes act 1947 provides for the settlement of an industrial dispute by way of adjudication when the dispute is referred to adjudicatory authority by the appropriate government under section 10 of this act. The appropriate government has the power to refer the industrial dispute to the adjudicatory authority its discretion even if the parties to the dispute have not applied to the appropriate government for such reference.

Authorities for adjudication :

Following are the authorities for adjudication under the industrial dispute Act 1947 :

1. Labour court
2. Industrial Tribunal
3. National Tribunal

Labour court :

Constitution

• The appropriate government is given the power under section 7 of the Industrial Dispute Act 1947.
• The appropriate government may constitute one or more labour courts.

Power of central Government:

The central government may constitute in any state for the adjudication of matters.

Power of State Government:

A state government may constitute labour courts in its territories.

• The constitution of the labour court is to be notified in official gazette.

Functions :

The functions of labour courts are —

The functions of the Labour Court are laid down in Section 7 of the said Act.

(I)  Adjudicating upon industrial dispute specified in the second schedule of the said Act; These are as follows:

1. The propriety or legality of any order passed by an employer under the standing orders;
2. The application and interpretation of the Standing Orders.
3. Discharge or dismissal of the workman including reinstatement of, or grant of relief to, the workman wrongfully dismissed;
4. Withdrawal of any customary concession or privilege (Illegality or otherwise of a strike or Lockout; and
5. All matters other than those specified in the Third Schedule which fall within the jurisdiction of Industrial Tribunal.

(II ) Performing such other functions as may be assigned to it under the Industrial Dispute Act, 1947:

The Other matters assignable on the Labour Court are:

• Voluntarily reference of dispute by written agreements between the parties under Section 10A;

• Arbitration reference under Section 10A;

• Permission to or approval of the action of discharge under Section 33;

• Complaint by the aggrieved employees under Section 33A;

• Application under Section 33(c) 2 for the computation of any money or any benefit which is capable of being computed in the terms of money.

• Reference of awards or settlement for the interpretation in case of difficulty or doubt under Section 36A.

Jurisdiction of the Labour Court:

A limited jurisdiction has been made available to the Labour Court which is circumscribed by the Section itself and the matter enumerated in the second scheduled (E.g., Dismissal, Retrenchment, Strike, Lockout etc) Labour court is not a Tribunal within the meaning of section 7A(3)(b) read with Section 2(R) and hence not bound by the rules of evidence and natural justice as is the case with Industrial Tribunal.

• The first provision to section 10(1) lays down that
  • Where the dispute relates to a matter specified in the third schedule and is not likely to affect more than hundred workmen
  • It can also be referred to labour court.

Presiding Officer:

A labour court shall consist of one person only to be appointed by appropriate government. Section 7 (3) lays down that a person shall not be qualified for appointment as the presiding officer unless

Qualification for the appointment of a Presiding Officer of the Court :

• He is or has been a judge of high court
• He has for a period of not less than 3 years, been a district judge or an additional judge
• He has held any judicial office in India for not less than 7 years
• He has been the presiding officer of labour Court constituted under any Provision Act for not less than 5 years.

Industrial Tribunals :

Section 7 A empowers the appropriate government to constitute one or more industrial tribunals-

• It’s appointment has to be published in official gazette
• The government has wide powers under this section
• To appoint tribunals for any limited time or for a particular case or a number of cases or for a particular area .

Functions

• Adjudication of industrial disputes
• Relating to any matter specified in the 2nd schedule or the 3rd schedule.
• Whereas labour court can adjudicate an industrial dispute relating to matters in schedule II.
• Thus there is a concurrent jurisdiction if the labour court and the industrial tribunal in respect of any matter included in the second schedule.

However as per section 10 (1) — Dispute of third schedule which is not affecting more than 100 workmen such dispute can also be referred to labour court .

The Third Schedule —

• Matter related to wages including the period and mode of payment
• Compensatory and other allowances
• Hours of work and rest intervals
• Leave with wages and holidays
• Bonus , profit -sharing , provident fund and gratuity
• Shift working otherwise than in accordance with standing orders
• Rule of discipline
• Rationalisation
• Retrenchment of workmen and closure of establishment.
• Any other matter that may be prescribed

Presiding officer and his qualification:

• An industrial tribunal shall consist of one person only to be appointed by the appropriate government. He shall be designated as the presiding officer of the tribunal.
• According to section 7 A (3) , a person to be appointed as the presiding officer of a tribunal must possess the following qualification :-
  • He is, or has been a judge of High Court
  • He has been a district judge or an additional district judge for a period of not less than 3 years.

The appropriate government may , if thinks fit , appoint two persons as assessors to advise the tribunal in the proceeding before it .

National Industrial Tribunal

Constitution

Section 7 B provides for the constitution of national industrial tribunal.

• Central government is empowered to constitute one or more national tribunals
• By notification in official gazette
• A national tribunal can be constituted only for the adjudication of industrial dispute involving questions of national importance or
• Industrial dispute affecting industrial establishment situated in more than one state.
• The reference to national tribunal can be made only by the central government
• The jurisdiction of a national tribunal is very wide and exclusive.

Presiding officer and his qualifications

The national tribunal shall consist of one person only to be appointed as its presiding officer of the national tribunal.

According to section 7B, qualification of presiding officer of national tribunal is as follows :-

• He is or has been a judge of the high court.
  According to section 7 b(4), the central government may , if it so thinks fir , appoint two persons as assessors to advice the national tribunal in the proceeding before it.

Disqualifications:

Section 7-C of the Industrial Dispute Act,1947 prescribes Disqualifications for the presiding officer to be appointed to the Labour Court, Industrial tribunal or National Industrial Tribunal. It provides that no person shall be appointed to or continue in office if:

• He is not an independent person; or

Independent person has been defined in section 2(i) of the Act which says that a p[erson is said to be independent if if he is unconnected with the industrial dispute referred to such Board, labour Court or tribunal.

• He has attained the age of 65 years

Under Section 8 of the industrial dispute Act,1947 the appropriate government is vested with the powers to fill up the vacancy in the Labor Court caused for any reason.

Power of Labour Court ,Industrial Tribunal an National Tribunal :

According to section 11 following are the power of adjudication authorities :

1. To enter the promises [Section 11 (2)]- According to the section , a member of the adjudicating authorities may enter the premises occupies by any establishment to which the dispute relates. But prior reasonable notice shall be given by such member.
2. Examinations of persons and inspection of documents [Section 11(3)]: According to Section 11(3), Labour Court, Industrial Tribunal and National Tribunal has the same powers as are vested in a Civil Court under of Civil Procedure, when trying a suit, in respect of the following matter namely :-
   • enforcing the attendance of any person and examining him on oath;
   • compelling the production of documents and material objects
   • Issuing commissions for the examination of witnesses;
   • In respect of such other matters as may be prescribed.

Every inquiry or investigation by the Labour Court, Industrial Tribunal or National Tribunal is deemed to be a judicial proceeding within the meaning of Sections 193 and 228 of the Indian Penal Code.

The jurisdiction of the Labour Court, Industrial Tribunal and National:

Jurisdiction power of adjudicating authorities in dealing with industrial dispute referred to them is limited to Section 10(4), to the points specifically mentioned in the order of reference and the matter incidental thereto.

Section 10(4) reads as follows:

10(4). “Where in an order referring an industrial dispute to a Labour Court, Industrial Tribunal or National Tribunal under Section 10(1) or in a subsequent order, the appropriate Government has specified the point of dispute for adjudication, the Labour Court or the Industrial Tribunal or the National Tribunal, as the case may be, shall confine its adjudication to those points and matters incidental thereto.”

 Power of Labour Court, Industrial Tribunal and National Tribunal to give appropriate relief in case of discharge or dismissal of workmen (Section 11-A)

Section 11-A states as follows:

11-A. “Where an industrial dispute relating to the discharge or dismissal of a workman has been referred to a Labour Court, Industrial Tribunal or National Tribunal for adjudication and, in the course of adjudication proceedings, the Labour Court, Industrial Tribunal or National Tribunal, as the case may be, is satisfied that the order of discharge or dismissal was not justified, it may, by its award, set aside the order of discharge or dismissal and direct reinstatement of the workman on such terms and conditions, if any, as it thinks fit, or give- such other relief to the workman, including the award of any lesser punishment, in lieu of discharge or dismissal as the circumstances may require :

Provided that in any proceeding under this Section, the Labour Court, Industrial Tribunal or National Tribunal, as the case may be shall rely only on the material on the record and shall not take any fresh evidence in relation matter.”

In the case of G. Shahsi Kumar vs. Management of Indian Industries 1998 : By introducing Section 11-A, the Labour Court and the Industrial Tribunal have been empowered to interfere with the quantum of punishment if it is a he opinion that the punishment awarded was not proportionate to the act of misconduct and that the punishment awarded was not justified keeping in view the facts of the case.”

Punishment to be proportionate to the gravity of offence

Gujrat Ambuja Cement Pvt. Ltd. Vs. U.B. Gadhe : A workman may be dismissed from the services by the employer for grave misconduct committed by him and Labour Court or Industrial Tribunal cannot set aside such dismissal and reinstate the workman under Section 11-A Industrial Disputes Act, 1947 simply out of sympathy for the workman. In exercise of power under Section 11-A of I.D. Act, 1947, the Labour Court cannot interfere with the quantum of the punishment imposed by the employer unless punishment is shockingly disproportionate to the proved charges.

3. Arbitration

Arbitration is a method by which the parties to the dispute agree to refer voluntarily the dispute for settlement to a third neutral person known as arbitrator. The arbitrator, after hearing both the parties to the dispute, determines the rights and duties of the parties to the dispute by its award , which is binding on the parties.

Advantages of Arbitration

Arbitration being an out of court, method of settlement of dispute is an inexpensive and speedy method of settlement of disputes.

Legal provisions

And industrial disputes settle by arbitration under section 10 A of the Industrial Dispute act, 1947. The parties to an industrial dispute may refer an industrial dispute, voluntarily by a written agreement to an arbitrator under section 10 A of the act .

The object of section 10 A is to enable employers and employees to refer their dispute voluntarily to arbitration.

The essential requirement

• There should be an existing or apprehend (doubtful) industrial dispute
• The reference to an arbitration should be by written agreement
• The reference should be made before the dispute referred under section 10 means this method can be availed only when the dispute has not been referred to a labour court or tribunal or national tribunal.
• The names of the person or persons act as an arbitrator or arbitrators must be specified in the agreement

• Arbitrator may be presiding officers or labour court , tribunal or national tribunal.
• The arbitration agreement must be in such a form and must be signed by the parties in such manner as may be prescribed by rules
• A copy of the arbitration agreement has to be sent to the
• appropriate government.
• conciliation officer
• The appropriate government is required to publish the same in the official gazette within one month of the date of receipt

Functions of Arbitrator

• Investigate the dispute: According to section 11 arbitrator shall follow such procedure for the investigation as prescribed by the government.
• Submit to the appropriate government a duly signed award which will be published in such manner as appropriate government thinks fit.(Section 17 {1})
• The appropriate government is empowered to prohibit the continuance of a strike or lockout in connection with an industrial dispute which is referred to arbitration.

Reference of certain individual disputes to Grievance Settlement Authorities

The Industrial Dispute Amendment Act 1982 has inserted new chapter IIB and section 9 -C in the Act for the setting up of grievance settlement authorities and reference of individual disputes to such authorities.

• The employer in relation to every industrial establishment, in which fifty or more workmen are employed or
• Have been employed on any day in preceding twelve months shall set up, A grievance settlement authority for the settlement of Industrial dispute.
• Such authority shall connect with an individual workmen employed in the establishment
• The total number of members of the Grievance Redressal Committee shall not exceed more than six

• The grievance authority shall follow such procedure and complete its proceedings within 30 days on receipt of a written application by or on behalf of aggrieved party.
• If workman is not satisfied with the decision of grievance redressal committee may prefer an appeal to the employer within one month and employer shall within one month from the date of receipt of such appeal , dispose off the same and send a copy of his decision to the workman concerned.

It has been made obligatory for an industrial establishment in which there are 50 or more workmen employed , to set up a time bound grievance redress procedure.

No reference shall be made with respect to any dispute unless :

• Such dispute has been referred to the grievance settlement authority concerned
• Decision of the authority is not acceptable to the any of the parties to the dispute.