CHAPTER 1: UNFAIR LABOUR PRACTICE

THE FIFTH SCHEDULE: Unfair Labour Practices

[Section 2(ra)]1

I. ON THE PART OF EMPLOYERS AND TRADE UNIONS OF EMPLOYERS

(1) To interfere with, restrain from, or coerce, workmen in the exercise of their right to organize,
form, join or assist a trade union or to engage in concerted activities for the purposes of
collective bargaining or other mutual aid or protection, that is to say. -

(a) threatening workmen with discharge or dismissal, if they join a trade union;

(b) threatening a lock-out or closure, if a trade union is organized;

(c) granting wage increase to workmen at crucial periods of trade union organization,
with a view to undermining the efforts of the trade union at organization.

(2) To dominate, interfere with or contribute support, financial or otherwise, to any trade union,
that is to say,

(a) an employer taking an active interest in organizing a trade union of his workmen; and

(b) an employer showing partiality or granting favour to one of several trade unions
attempting to organize his workmen or to its members, where such a trade union is not a
recognized trade union.

(3) To establish employer sponsored trade unions of workmen.

(4) To encourage or discourage membership in any trade union by discriminating against any
workman, that is to say,

(a) discharging or punishing a workman, because he urged other workmen to join or

organize a trade union;

(b) discharging or dismissing a workman for taking part in any strike (not being a strike
which is deemed to be an illegal strike under this Act);

(c) changing seniority rating or workmen because of trade union activities;

(d) refusing to promote workmen of higher posts on account of their trade union
activities;

1
Section 2(ra) of Industrial Dispute Act 1947

1|Page
 (e) giving unmerited promotions to certain workmen with a view to creating discord
amongst other workmen, or to undermine the strength of their trade union;

(f) discharging office-bearers or active members of the trade union on account of their
trade union activities.

(5) To discharge or dismiss workmen-

(a) by way of victimization;

(b) not in good faith, but in the colourable exercise of the employer’s rights;

(c) by falsely implicating a workman in a criminal case on false evidence or on concocted

evidence;

(d) for patently false reasons;

(e) on untrue or trumped up allegations of absence without leave;

(f) in utter disregard of the principles of natural justice in the conduct of domestic enquiry
or with undue haste;

(g) for misconduct of a minor technical character, without having any regard to the nature
of the particular misconduct or the past record or service of the workman, thereby leading
to a disproportionate punishment.

(6) To abolish the work of a regular nature being done by workmen, and to give such work to
contractors as a measure of breaking a strike.

(7) To transfer a workman mala fide from one place to another, under the guise of following
management policy.

(8) To insist upon individual workmen, who are on a legal strike to sign a good conduct bond, as
a precondition to allowing them to resume work.

(9) To show favouritism or partiality to one set of workers regardless of merit.

(10) To employ workmen as "badlis", casuals or temporaries and to continue them as such for
years, with the object of depriving them of the status and privileges of permanent workmen.

(11) To discharge or discriminate against any workman for filing charges or testifying against an
employer in any enquiry or proceeding relating to any industrial dispute.

(12) To recruit workman during a strike which is not an illegal strike.

2|Page
(13) Failure to implement award, settlement or agreement.

(14) To indulge in acts of force or violence.

(15) To refuse to bargain collectively, in good faith with the recognized trade unions.

(16) Proposing or continuing a lock-out deemed to be illegal under this Act.

II. ON THE PART OF WORKMEN AND TRADE UNIONS OF WORKMEN

(1) To advise or actively support or instigate any strike deemed to be illegal under this Act.

(2) To coerce workmen in the exercise of their right to self-organization or to join a trade union
or refrain from, joining any trade union, that is to say-

(a) for a trade union or its members to picketing in such a manner that non-striking
workmen are physically debarred from entering the work places;

(b) to indulge in acts of force or violence or to hold out threats of intimidation in

connection with a strike against non-striking workmen or against managerial staff.

(3) For a recognized union to refuse to bargain collectively in good faith with the employer.

(4) To indulge in coercive activities against certification of a bargaining representative.

(5) To stage, encourage or instigate such forms of coercive actions as wilful, “go-slow",
squatting on the work premises after working hours or "gherao" of any of the members of the
managerial or other staff.

(6) To stage demonstrations at the residence of the employers or the managerial staff members.

(7) To incite or indulge in wilful damage to employer’s property connected with the industry.

(8) To indulge in acts of force or violence or to hold out threats of intimidation against any
workman with a view to prevent him from attending work.

3|Page
CHAPTER 2: CONCEPT OF UNFAIR LABOUR PRACTICE UNDER
INDUSTRIAL DISPUTE ACT 1947
• The Industrial Dispute Act, 1947

The Industrial Disputes Act, 1947 2has been enacted for the investigation and settlement of
industrial disputes in any industrial establishment.

The Industrial Disputes Act defines "Industrial dispute" as a dispute or difference between
workmen and employers or between workmen and workmen, which is connected with
employment or non-employment or the terms of employment or with the conditions of labour.
Dismissal of an individual workman is deemed to be an industrial dispute.

The ID Act provides for the constitution of the Works Committee, consisting of employers and
workmen, to promote measures for securing and preserving amity and good relations between
the employer and the workmen and, to that end, endeavours to resolve any material difference of
opinion in respect of such matters.

The ID Act provides for the appointment of Conciliation Officers, Board of Conciliation, Courts
of Inquiry, Labour Courts, Tribunals, and National Tribunals for settlement of disputes. Another
method recognised for settlement of disputes is through arbitration. The Industrial disputes Act
provides a legalistic way of settling disputes. The goal of preventive machinery as provided
under the Act is to create an environment where the disputes do not arise at all. The ID Act
prohibits unfair labour practices which are defined in the Fifth Schedule—strikes and lockouts
(except under certain defined conditions and with proper notice). It also provides for penalties for
illegal strikes and lockouts and unfair labour practices and provisions regarding lay off and
retrenchment as well as compensation payable thereof.

The ID Act provides that an employer who intends to close down an industrial establishment
shall obtain prior permission at least ninety days before the date on which he intends to close
down the industrial establishment, giving the reasons thereof.

• The Trade Unions Act, 1926

The object of Trade Union Act, 1926 is to provide for registration of Trade unions and to define
law relating to registered trade unions in certain aspects. In the year 1925 the Government of
India, after consulting the State Governments drew up a Bill providing for the registration of
trade unions and introduced the same in the Legislative Assembly on the 1st August, 1925. The
Indian Trade Union Act was passed in 1926 and came into force on the 1st June, 1927. Later on,
the Word “Indian” has been repealed by the Amendment, 1964.

Section 2(h) 3of the Trade Unions Act, 1926 has defined a trade union as:

2
Industrial Dispute Act 1947
3
Section 2(h) of Trade Union Act 1926

4|Page
“Any combination, whether temporary or permanent, former primarily for the purpose of
regulating the relation between workman and workmen or between employers, or for imposing
restrictive conditions on the conduct of any trade or business, and includes any federation of two
or more trade unions.4

Thus, technically, there can be ‘union’ of employers also, though, almost universally, the term
‘trade union’ is associated with union of workmen or employees.

Registration of a trade union is not compulsory but is desirable since a registered trade union
enjoys certain rights and privileges under the Act. The trade union Rights includes the Right
regarding the formation and the registration of the trade union and the Right regarding the
recognition of the trade union by the employers and many more.

Section 25T in The Industrial Disputes Act, 19475

25T. Prohibition of unfair labour practice. - No employer or workman or a trade union,
whether registered under the Trader Unions Act, 1926 (16 of 1926), or not, shall commit
any unfair labour practice.

CHAPTER 3: EVOLUTION OF LABOUR LAW IN INDIA

The law relating to labour and employment is also known as Industrial law in India. The history
of labour legislation in India is interwoven with the history of British colonialism. The
industrial/labour legislations enacted by the British were primarily intended to protect the
interests of the British employers. Considerations of British political economy was naturally
paramount in shaping some of these early laws. Thus, came the Factories Act. It is well known
that Indian textile goods offered stiff competition to British textiles in the export market and
hence in order to make India labour costlier the Factories Act was first introduced in 1883
because of the pressure brought on the British parliament by the textile magnates of Manchester
and Lancashire. Thus, India received the first stipulation of eight hours of work, the abolition of
child labour, and the restriction of women in night employment, and the introduction of overtime
wages for work beyond eight hours. While the impact of this measure was clearly welfarist the
real motivation was undoubtedly protectionist. The earliest Indian statute to regulate the
relationship between employer and his workmen was the Trade Dispute Act, 1929 (Act 7 of

4
The Trade Union Act, 1926, § 2(h).
5
Section 25 of IDA 1947

5|Page
1929). Provisions were made in this Act for restraining the rights of strike and lock out but no
machinery was provided to take care of disputes. The original colonial legislation underwent
substantial modifications in the post-colonial era because independent India called for a clear
partnership between labour and capital. The content of this partnership was unanimously
approved in a tripartite conference in December 1947 in which it was agreed that labour would
be given a fair wage and fair working conditions and in return capital would receive the fullest
co-operation of labour for uninterrupted production and higher productivity as part of the
strategy for national economic development and that all concerned would observe a truce period
of three years free from strikes and lockouts. Ultimately the Industrial Disputes Act (the Act)
brought into force on 01.04.1947 repealing the Trade Disputes Act 1929 has since remained on
statute book.

CHAPTER 4: CONSTITUTIONAL PROVISIONS WITH REGARDS TO

LABOUR LAW

There is a general rule that every freedom is not absolute, similarly The Fundamental Right to

Form union under Article 19(1)(c) 6is not absolute, subject to reasonable restrictions provided

under Clause (4) of The Article 19 on the ground of ‘sovereignty and integrity of India’ or

‘public order’ or ‘morality’.

The relevance of the dignity of human labour and the need for protecting and safeguarding the
interest of labour as human beings has been enshrined in Chapter-III (Articles 16, 19, 23 & 247)
and 7 Chapter IV (Articles 39, 41, 42, 43, 43A & 54) of the Constitution of India keeping in line
with Fundamental Rights and Directive Principles of State Policy.

Labour is a concurrent subject in the Constitution of India implying that both the Union and the
state governments are competent to legislate on labour matters and administer the same. The bulk
of important legislative acts have been enacted by the Parliament

6
Article 19(1)c of Indian Constitution
7
Article 16’,19,23and 24 of Indian Constitution

6|Page
 CHAPTER 5: JUDICIAL DECISION WITH REGARDS TO UNFAIR
LABOUR PRACTICE

Unfair labour practices alleged by workers cannot be routinely taken on face value, the Supreme
Court has ruled, stating that they must be interpreted in the context of globalization and modern
industrialization.

A bench of justices D K Jain and A K Ganguly, in a judgement, said the argument of unfair
practices can be accepted only if there is "arbitrariness and unreasonableness" in the
management's action violating Article 14 8(equality) of the Constitution.

"Any unfair labour practice within its very concept must have some elements of arbitrariness and
unreasonableness and if unfair labour practice is established, the same would bring about a
violation of guarantee under Article 14 of the Constitution."

The court said, "It is also to be kept in mind that in the changed economic scenario, the concept
of unfair labour practice is also required to be understood in the changed context."

"Today every state, which has to don the mantle of a welfare state, must keep in mind the twin
objectives of industrial peace and economic justice and the courts and statutory bodies while
deciding what unfair labour practice is must also be cognizant of the aforesaid twin objects,"
Justice Ganguly, writing the judgement, said.

The apex court upheld an appeal of Siemens Ltd challenging the concurrent findings of the
labour court and the Bombay High Court which had quashed the company's decision to create a
cadre of Junior Executive Officers, to be filled from among the company's workmen.

It was the case of the workmen under the Siemens Employees Union that the promotional
scheme amounted to unfair labour practices as defined under Section 9A of the Industrial
Disputes Act, 1947; and sections 9 and 10 of the Maharashtra Recognition of Trade Unions and
Prevention of Unfair Labour Practices Act, 1971.

Rejecting the workers' plea, the apex court said in the present case the workers had
overwhelmingly applied for the promotional scheme and there was no question of victimization
as alleged.

"In the instant case no allegation of victimization has been made by the respondent-union in its
complaint. In the absence of any allegation of victimization it is rather difficult to find out a case
of unfair labour practice against the management in the context of the allegations in the

8
Article14 of Indian Constitution

7|Page
complaint.

"So in the instant case if by way of rearrangement of work, the management of the appellant-
company gives promotional opportunity to the existing worker that does not bring about any
violation of clause 7 of the said settlement rather such a rearrangement of work will be in terms
of clause 12," the bench said.

According to the apex court, if the job of executive officers are the same as is done by the
existing worker, that does not bring about such a violation of clause 7 as to constitute unfair
labour practice.

"The Labour Court and the High Court must consider the said agreement reasonably and
harmoniously keeping in mind the vast changes in economic and industrial scenario and the new
challenges which the appellant-company has to face in the matter of reorganizing work in order
to keep pace with the changed work culture in the context of scientific and technological
development," the apex court said.

The bench said it was not that the management was punishing any workmen in any manner by
introducing the promotion scheme to which the workers overwhelmingly responded.

"It may be that the number of workmen is reduced to some extent pursuant to a promotional
scheme to which the workmen readily responded. But no union can insist that all the workmen
must remain workmen perpetually otherwise it would be an unfair labour practice," Justice
Ganguly added.

8|Page
CONCLUSION
Unfair Labour Practice are a dynamic socio-economic problem in the process to resolve in any
country of the world today. The employers and the employees are systematically and constantly
striving to improve their values and work towards increasing production. A good labour
management relationship affords higher production providing for the survival of the society.
With a view to meet every situation in labour management relations the Labour Laws are sought
to evolve a rational synthesis between conflicting flames of the management and employees. The
labour-management examines the merits of the rival claims or contentions and seeks to resolve
the conflict by evolving the solutions without summoning any injustice to the employers and
solves the legitimate claims of the employees. Therefore, the Labour Law seeks to regulate
relations between managements, trade unions and employees.

9|Page