Introduction

The Constitution of India is considered to be the source of all labour laws,

all the matters related to labour law are covered under List III of Schedule
VII i.e. the Concurrent List.w

Industrial dispute act 1947 (IDA)

All matters of Industrial dispute are covered under List I of Schedule VII, i.e.
the union list. Laws related to Industrial Dispute (ID) are known as
Industrial Laws.

Objective of IDA
 To make provision for investigation and settlement of IDs or certain
other purposes.

History of IDA
In 1920, there was Trade Dispute Act which provided for courts of enquiry &
consolation board. However it did not provide any machinery for settlement
of Industrial Disputes. Therefore it was repealed and replaced by Trade
Dispute Act, 1929.

The 1929 Act was amended in 1938; it authorized Central & Provisional
Government to intermediate at the time of IDs.

Further Govt. introduced Defense of India Rules post World War II. Rule 81A
gave powers to the Government to intervene in the Industrial Disputes so as
to provide speedy remedies. Further Standing Orders of 1946 were also
passed.

On the basis of Trade Dispute Act, 1938, Defense of India Rules & Standing
Orders, 1946,
ID Bill was introduced in the Central Legislative Assembly on 08/10/1945
which embodied the essential principles of Defense of India Rules & Trade
Dispute Act, 1938 concerning Industrial Disputes.
The Bill was passed in March 1947 & became a law from 1947 which came
to be known as IDA, 1947.
 Industry
Definition of the term industry first originated from IDA, 1947.

Sec 2(j) of IDA, 1947 provides that:

The term ‘industry’ means any business, trade, undertaking,

manufacture or calling of employers & includes any calling, service,
employment, handicraft, or industrial occupation or avocation of workmen.

This section is based on Section 4 of Commonwealth Conciliation &

Arbitration Act, 1904 which is an Australian statute.

Section 2(j) of IDA was amended in 1982, which substituted a new definition
but since no enforcement date has been notified so far, the original
definition remains in force.

Scope of Industry
The definition of Industry under IDA is a comprehensive one, and it is in two
parts:
First part says that it means any business, trade, undertaking, manufacture
or calling of employers.
Second part says that it includes any calling, service, employment,
handicraft, or industrial occupation or avocation of workmen.

One part defines it from the standpoint of the employers and the other from
the standpoint of the employees. Therefore, any activity which falls within
either of these two parts automatically becomes an industry.

Madras Gymkhana Club Employee’s Union vs. Gymkhana Club (1967) 2 LLJ
720.

In this case it was held that the first part of the definition determines an
industry by reference to the occupation of the employers in respect of
certain activities which are specified by five words namely business, trade,
undertaking, manufacture or calling.

These words determine the scope of the word industry & they describe what
the cognate expression Industry is intended to convey. This is the
significance or denotation of the term.
Business
It is a word of wide import. It is wider than trade and is not synonymous
with it and means practically anything which is not an occupation as
distinguished from pleasure.

National Association of Local Govt. Officers v. Bolton Corporation (1943) AC

166 at p. 184

In this case Lord Wright after referring to the definition of ‘trade dispute’ and
‘workmen’ contained in the order of reference to the National Arbitration
Tribunal held that the word “industry” would include within its scope what
might not strictly be called “trade or business”.

Trade
It is not only in the etymological or dictionary sense, but in legal use as well
it is a term of wide scope. It may mean the occupation of a small shopkeeper
just as well as that of a commercial magnate while it may also mean skilled
craft.

Undertaking
According to Webster dictionary, an undertaking means anything
undertaken or any business, work or project which one engages or one
attempts as an enterprise.

Manufacture
It is a kind of productive activity in which the making of articles or material
often on a large scale is by physical labour or mechanical power.

Employment
It means contract of service between an employer and an employee.

Avocation
It means the way a man passes his life or spends his time.

Whether a municipal corporation comes under the definition

of an industry?

D.N. Banerjee v. P.K. Mukherjee AIR 1953 SC 58

In this case 2 employees of the Municipality were dismissed. The dismissal
was questioned and the matter was referred to the Industrial Tribunal. The
tribunal directed reinstatement but the municipality challenged the award
before the High Court and ultimately before the Supreme Court on the
grounds that a Municipality was not engaged in any industry. So the
provisions of the IDA were not applicable.

The Court in this case holding municipal corporation to be an industry held

that in true sense the activities of Municipal Corporation will not fall under
the meaning of expression business or trade. But it may fall under the
meaning of undertaking and as the definition provided under Section 2(j) of
IDA covers undertaking as Industry therefore, Municipal Corporation will be
considered as an Industry.

The Court further stated that neither investment of capital nor profit making
motive is essential to constitute an industry as they are generally necessary
in a business.

Baroda Borough Municipality v. Its Workmen AIR 1957 SC 110

In this case the Court observed that those branches of work of the
municipalities which could be regarded as analogous to the carrying-on of a
trade or business would be industry and the dispute between municipalities
and their employees would be treated as an industrial dispute.

Corporation of City of Nagpur v. Employees.

There was an appeal in the Supreme Court. The question for consideration
was “Whether & to what extent the activities of Corporation of Nagpur came
under definition of Industry as per Section 2(14) of CP & Berar Industrial
Dispute Settlement Act, 1947?”

Courts cleared that Corporation will not come under the definition of
undertaking as per Section 2(14) of CP & Berar Industrial Dispute
Settlement Act, 1947, but will come under the definition of business, trade
as per Section 2(14) of CP & Berar Industrial Dispute Settlement Act, 1947.
The Court distinguished between legal & municipal functions of
Corporation, & held that legal functions will not come under the definition of
industry & such legal function should be excluded from the ambit of
definition of industries & that other functions will come under the ambit of
definition of business or trade.

Conclusion
Corporations will come under the definition of industry as per Section 2(j) of
IDA 1947.

Whether hospitals come under the definition of an industry?

State of Bombay v. Hospital Mazddor Sabha AIR 1960 SC 610

This is the 1st case before Supreme Court in which the question whether
hospitals will come under the definition of Industry was considered.

In this case 2 employees were terminated by way of retrenchment. The

employees filed a writ petition in the SC for their reinstatement. The writ
petition was resisted on the grounds that the hospitals did not constitute an
industry and therefore the provisions of Industrial Dispute Act are
inapplicable.

The Court held that the group of hospitals was run by the State for giving
medical relief to citizens and imparting medical education. The SC held
group of hospitals to be industry and held as follows:

a) State is carrying on an undertaking within the meaning of Section 2(j)

of IDA, 1947 when it runs a group of hospitals for giving medical relief
and imparting medical education.
b) An activity systematically or habitually undertaken for production or
distribution of goods or for rendering of material services to the
community at large or part of such community with the help of
employees is an undertaking.
c) Question as to who conducts the activity is irrelevant.
d) Absence of capital investment and profit motive or gainful objective is
irrelevant.

Safdar Jung Hospital v. Kuldip Singh Sethi AIR 1970 SC 1406

In this case the Supreme Court overruled the Mazdoor Sabha case ruling.
Herein there were 3 hospitals who filed an SLP in the SC in order to get
clarity on the point whether they came under the definition of industry in
Section 2(j) of the IDA, 1947.

The 3 hospitals were:

Safdar Jung hospital which was being run by the State
Tuberculosis hospital which was being run by a Research Institute.
Kurji Holi Family Hospital which was being run by a charitable institution.

In this case, SC held that KURJI Holy Family Hospital was not an industry
on the ground that it was essentially charitable institution carrying on work
of training, research, treatment, Safdar Jung hospital and Tuberculosis
hospital were also held not to be industry.

Management of Hospital v. it Workmen AIR 1971 SC 1259

In this case, the SC following the ration in Safdar Jung Hospital case
clarified that the hospital run by the State Government were held outside
the purview of industry.

Bangalore Water Supply Case

In this case after considering all the precedents the SC overruled the Safdar
Jung Hospital case and reinstated Hospital Mazdoor Sabha case.
The SC held that all the Hospitals, dispensaries, medical colleges whether
run by the government or private sector are within the scope of industry as
defined in Section 2(j) of IDA, 1947 if they fulfill the Triple Test.
Triple Test
Where
a) Systematic activity;
b) Organized by co-operation between employer and employee;
c) For the production and/or distribution of goods and services
calculated to satisfy human wants and wishes.
Prima facie, there is an ‘industry’ in that enterprise.
This is known as the Triple Test.
Effect of Substituted definition
A new definition of Industry has been enacted by way of Industrial Disputes
(Amendment) Act, 1982. In the definition hospitals or dispensaries have
been excluded from the purview of definition of Industry. However, the
amended definition has not been enforced.

Conclusion
It can be concluded that at present Hospitals would be considered as
Industry as per the definition given in Section 2(j) of IDA, 1947.

Whether educational institutions will come under the

definition of an industry?

University of Delhi v. Ramnath AIR 1963 SC 1873.

In this case 2 drivers of Delhi University were terminated because the

running of buses for transporting girl students was going onto a loss. The
termination order was challenged on the ground that the drivers were
workmen and the termination of their services amounted to retrenchment.
Hence, they filed petitions before the Industrial tribunal for their
reinstatement. The petitions were contested upon by the University on the
preliminary ground that the Delhi University did not come under the
definition of Industry. However, the Tribunal rejected the plea of Delhi
University and decided the case on merits and held that Delhi University will
come under the definition of Industry.

The Delhi University challenged the decision of the Tribunal in the Supreme
Court by way of an SLP on the ground that activity carried on by the
University is nit industry.

The SC held that DU is not an industry and gave the following 2 grounds as
reasons:
a) The teachers are not workmen under Section 2(s) of IDA, 1947 and
hence any disputes between them and the institution which employed
them are outside the scope of the Act.
 b) The work of the University cannot be equated with that of any trade,
business, undertaking or calling of services within the meaning of
Section 2(j) of IDA, 1947.

The Court said that education could not be treated as an Industry for the
benefit of a very minor and insignificant number of people who may be
employed by the University for subordinate services.

Bangalore Water Supply Case

The Supreme Court overruled the Delhi University ruling in this case. In this
case, the majority opinion of the Court was that the predominant activity of
the educational institutions is that of imparting education which is a service
to the community and therefore, it will come under the definition of Industry
as per Section 2(j) of IDA, 1947. However, the Court emphasized that those
employees of the University who are not workmen within the meaning of
Section 2(s) of the Act, may not get the desired benefits to which a workman
in an industry may be entitled to.

The Court concluded that the case of Delhi University was wrongly decided
and educational institutions will come under the definition of Industry.

Effect of Substituted definition

A new definition of Industry has been enacted by way of Industrial Disputes
(Amendment) Act, 1982. In the definition all educational, scientific, research
or training institutions have been excluded from the purview of definition of
Industry. However, the amended definition has not been enforced.

Conclusion
It can be concluded that at present Educational Institutions would be
considered as Industry as per the definition given in Section 2(j) of IDA,
1947.

Whether CLUBS will come under the definition of an

industry?

Bengal Club Limited v. Shanti Ranjan Somddar (1957) 1 LLJ 505.

In this case a question arose before the Calcutta High Court that whether
company running club for profit will come under the definition of Industry.
Herein, a single judge took the view that an incorporated company running
clubs for profit and business will come under the definition of Industry as
per Section 2(j) of IDA, 1947.

Madras Gymkhana Club Employees Union v. Gymkhana Club (1967) 2 LLJ

720.
Herein the question before the SC was that whether non-proprietary
members club is an Industry or not within Section 2(j) of IDA, 1947.
The Court held that the question could not be decided on the basis of size of
the club or largeness of members or the extent of profit. As the activities of
the club did not fall within the meaning of trade, business, manufacturing
or calling of employees, therefore the only question to be considered is
whether it falls within the meaning of an undertaking or not.
After an analysis of constitution of membership it was found out that it
existed for its members and is a self-serving institution. The Court observed
that since the club existed for the services of its members itself and for their
amusement and self-satisfaction therefore, it cannot be called an
undertaking and hence clubs will not come under the definition of Industry.

Cricket Club of India v. Bombay Labour Union AIR 1969 SC 276

Herein, SC relying on the grounds of Madras Gymkhana Club ruling held
that Cricket Club of India being a self-serving institution was not an
industry notwithstanding its catering facilities provided to its members.

Bangalore Water Supply Case

The SC in this case overruled both the Madras Gymkhana and Cricket Club
of India cases and held that those clubs whose activities responded to the
Triple Test laid herein would be considered as Industry as per Section 2(j) of
IDA, 1947.

Conclusion
It can be concluded that at present those clubs are considered as an
Industry whose activities respond to the Triple Test.
 Whether CO-OPERATIVE SOCIETIES will come under the
definition of an industry?
This question whether co-operative societies will come under the definition
of an industry was decided on the basis of 2 Australian cases i.e. Queen v.
Marshall and Ex Parte Federated Clerks Union of Australia.

SC after analysing various Indian and foreign rulings held that the co-
operative societies ordinarily cannot fall outside the definition of industry
and gave the following reasons:

a) A society is the employer and the members or others are employees,

therefore, a relationship of employer and employee is established.
b) The Court observed that the activity of co-operative societies pertains
to nature of trade and therefore co-operative societies will come under
the definition of industry.
c) The Court clarified that if the state is giving encouragement to a co-
operative society that does not mean that it will be exempted from the
definition of Industry.
d) If a co-operative society is worked by the members only, then the
entity is an industry because the member workers are paid wages and
there can be a dispute regarding wages and scale of wages among the
category of workers.

Rajasthan Rajya Sahkari Samiti Vyavasthapak Union v. Judge, Industrial

Tribunal, Rajasthan 1985 LIC 1023

In this case the Rajasthan High Court held that Rajasthan Co-operative
Credit Institution Cadre authority is an industry.

Conclusion of industry
Coir Board Ernakulam Kerala State v. Indira Devai P.S. (2000) 1 SCC 224.

In this case, a reference was made by a 2 judge bench to reconsider the

judgment of the SC in the Bangalore Water Supply Case. Herein, a 3 judge
bench of the SC held that there was no need of any reconsideration of the
judgment on a reference being made by a two judge bench of this Court
which is bound by the judgment of the larger bench.
 Industrial dispute

Industrial Dispute is defined in Section 2(k) of IDA, 1947. This definition is a

modification of definition given in Section 2(j) of Trade Dispute Act, 1929.

Madras Gymkhana Club Employees Union v. Gymkhana Club (1967) 2 LLJ

720.

In this case the Court cleared that the definition expressly states that not all
disputes or differences of all sorts but only those which bear upon the
relationship of employer and workman and the terms of employment and
conditions contemplated.

Workmen of Dimakuchi Tea Estate v. The Management of Dimakuchi Tea

Estate.

Dr. K.P. Banerjee was appointed as an Assistant Medical Officer of

Dimakuchi Tea estate on a three-month-probation and subject to a
satisfactory medical report while his suitability for permanent employment
was to be considered. If considered unsuitable he would have received 7 day
notice in writing terminating his employment. However, if he was found
guilty of misconduct then he would face instant dismissal.

After probation he was to be confirmed if found suitable. After three months

of his appointment he was given an increment but 2 months after that he
was terminated with immediate effect and was offered 1 months’ salary in
lieu of notice. The cause of Dr. Banerjee was espoused by the Union which
enquired for the reasons for his discharge and was informed that the ground
of dismissal was incompetence. The case was ultimately referred to SC.

In this case the SC analysed the definition of Industrial Dispute and

observed that it falls easily and naturally into 3 parts:

a) There must be a dispute or difference;

b) The dispute or difference must be between employers and employers,
or between employers and workmen, or between workmen and
workmen;
 c) The dispute or difference must be connected with the employment or
non-employment or the terms of employment or with the conditions of
labor of any person.

The Court further held that the expression ‘any person’ occurring in the
third part of the definition clause cannot mean anybody and everybody in
this wide world, because a person in respect of whom the employer-
employee relation never existed or can never possibly exist cannot be the
subject-matter of an industrial dispute.

The SC held that in the instant case Dr. K.P.Banerjee was not a ‘workman’.
He belonged to the medical or technical staff – a different category altogether
from the ‘workmen’ and therefore the provisions of IDA, 1947 would not be
applicable to him.

 The definition of Industrial Dispute in Section 2(k) of IDA, 1947 can be

divided into 4 parts:
a) Factum of Dispute
b) Parties to the Dispute
 Employer and employer
 Employer and workman
 Workman and workman
c) Subject matter of Dispute
 Employment or non-employment
 Terms of employment or conditions of labour, of any person
d) It should be related to industry.

Narendra Kumar Sen v. Labour Appellate Tribunal (1953) 1 LLJ 6.

In this case the question arose as to what type of disputes can be considered
as an Industrial Dispute. The Court held that the disputes or differences
must be something fairly definite and of real substance and not a mere
personal quarrel or grumbling or an agitation.

Shambu Nath Goyal v. Bank of Baroda, Jalandhar (1978) 1 LLJ 484.

In this case the question arose as to what constitutes an Industrial Dispute.

The Court held that an Industrial Dispute comes into existence when the
employer and workmen are at variance and the dispute or difference is
connected with the employment or non-employment, the terms of
employment or conditions of labour. In other words, a dispute or difference
arises when the demand is made by the workman to the employer and it is
rejected by him and vice versa.

Bangalore Water Supply Case

In this case, the concept of Industry has been exhaustively considered and
clear principles have been laid down in this regard.

It may be observed that the persons engaged in the establishment which are
covered in the definition of industry under Section 2(j) of IDA, 1947 become
workman if they satisfy the definition of workman as contained in Section
2(s) of IDA, 1947 and dispute on various matters among them or dispute
between employers and employers or dispute between employers and
workman or dispute between workman and workman are all disputes within
the meaning of the Act provided they are connected with the employment or
non-employment or terms of employment or conditions of labour.
 Individual dispute

When an Individual Dispute becomes an Industrial Dispute?

Kandan Textiles v. Industrial Tribunal 1949 LLJ 875.

In this case, the Court held that a dispute between an employer and a single
workman cannot be an Industrial Dispute.

Swadeshi Cotton Mills Company Limited v. Rajamani (1953) 1 LLJ 277.

In this case, the Court held that a dispute between an employer and a single
workman can be regarded as an Industrial Dispute.

Bilash Chandra Mitra v. Balmar Company Limited (1953) 1 LLJ 337.

In this case, the Court held that a dispute between an employee and single
workman cannot per se be an Industrial Dispute but may become one if it is
taken up by the trade union or a number of workmen.

On a contradiction of judicial opinions the SC in the Central Province

Transport Service Case preferred the last of above 3 views and the same was
further reaffirmed by the Court in the case of Newspaper Limited v.
Industrial Tribunal (1957) 2 LLJ 1.

Workman v. Dharam Pal Prem Chand (1965) 1 LLJ 668

In this, the Court said that a dispute raised by a single workman cannot
become an Industrial Dispute unless it is supported either by his union or
in the absence of union by a substantial number of workmen.

The principle in the above case was again reiterated in the case of Workmen
of Indian Express Newspaper Private Limited v. Management (1970) 2 LLJ
132.

SECTION 2A introduces and defines that a dispute between an individual

workman and his employer connected with his discharge, dismissal,
retrenchment or termination is deemed to be an Industrial Dispute
irrespective of the fact no other workman or any union is party to that
dispute.
Bombay Union of Journalists v. The Hindu, Bombay AIR 1963 SC 318

A journalist was terminated. This issue of termination was raised by union

of journalists. However, it was found out that out of 10 employees 7 were
working on the administration side and out of the 3 left, 2 were members of
journalist union.

The SC held that Bombay Union of Journalist does not have competence to
raise the issue and even if they have the competence the same cannot be
considered as an Industrial Dispute.

Hari Fertilisers v. State of U.P. 1992 LIC 1877.

In this case, the Court held that a dispute relating to the termination of
service, discharge or dismissal of a workman referred to adjudication under
Section 2A cannot be settled by the Union with the management by entering
into a settlement pending such adjudication without the consent of the
worker.

Praga Tools Limited v. Government of A.P 1976 LIC 190.

In this case, it was held that except the dispute relating to the discharge,
dismissal, retrenchment or otherwise termination of service, all other
disputes relating to the terms of employment or conditions of labour of an
individual labour such as transfer, wages, bonus, increments or promotion
etc. will require espoused (support or adoption) by a substantial number of
fellow workmen in order to partake the character of an Industrial Dispute.

Bombay Union of Journalists v. The Hindu (1961) 2 LLJ 436.

In this case, the SC held that in order that an individual dispute may
become an Industrial Dispute it has to be established that it had been taken
up by the union of employees or by an appropriate number of employees of
the establishment.

Jagdish Narain Sharma v. Rajasthan Patrika Limited and Another (1994) 2

LLJ 600 (Raj.)

In this case, it was held that a dispute relating to transfer of a workman will
become an industrial dispute only when it is espoused by a union of
workmen or by a substantial number of workmen employed in an industry.
Express Newspapers (Private) Limited v. First Labour Court, West Bengal and
Others.

It was held in this case that a dispute is an industrial dispute even where it
is sponsored by a union which is not registered; but the trade union must
not be one unconnected with the employer or the industry concerned.

Binny Limited v. Their Workmen AIR 1972 SC 1975.

In this case, the Court held that where an industrial dispute existed at the
time of making order of reference this dispute does not cease to be so merely
because dispute relating to only one employee is left over and that the
union which raised the dispute chooses not to represent a particular
employee.
 Workman
The term ‘workman’ has been defined under Section 2(s) of IDA, 1947.

Meaning of Apprentice
The expression apprentice has not been defined in IDA, 1947.

An apprentice is one who is a learner of art meaning thereby one who is

bound by a legal agreement to serve an employer for a period of years with a
view to learn some handicraft, trade etc. in which the employer is
reciprocally bound to instruct him.

Whether apprentice will come under the definition of Workman as

given under Section 2(s) of IDA, 1947?
U.P. State Electricity Board v. Shiv Mohan Singh AIR 2004 SC 5009

The question whether apprentice will be considered as a workman was

elaborately discussed by the SC in this case. The court in this case held that
the nature and character of the apprentice is nothing but that of a trainee
and he is supposed to enter into a contract and by virtue of that contract he
is to serve for a fixed period and a fixed stipend. The court further clarified
that as per the provisions of Apprentices Act, 1961 such contracts should be
registered however non-registration of the same would not change the
position of the apprentice to that of a workman.

Hanuman Prasad Chaudhary v. Rajasthan State Electricity Board 1986 LIC

1014 Raj.

The Court herein held that an apprentice governed by Apprentice Act, 1961
is not a workman for the purpose of IDA, 1947 and the provisions of IDA,
1947 would not be applicable to him. The Court clarified that for the
purpose of Section 2(s) of IDA, 1947 a person who is designated as an
apprentice but is not governed by the Apprentices Act would be a workman
governed by the provisions of IDA, 1947.

Narendra Kumar v. State of Punjab 1985 LIC 541.

Manual Work
It is not confined to work by the application of hands but comprises work
involving physical exertion as distinct from mental or intellectual exertion.

BLC Ltd. V. Ram Bahadur Jamadar (1975) 1 LLJ 422.

In this case it was held that even workmen who do not work with their
hands but work with their legs or remain standing on duty would be doing
manual work.

For instance members of watch and watch staff employed for the security of
the properties or of a concern do manual work.

Unskilled Work
Any person who does any work which does not require any special skill to
perform the work assigned is termed to be doing unskilled work.

Bata India Ltd. v. B.M.Nathani 1978 LIC 386.

In this case, the workman concerned was a salesman in a shoe shop.

Herein, the Gujarat High Court held that the nature of his job was of
unskilled labour. The fact that he tried to impress upon the customer that
the shoe manufactured by the company were durable was not his principle
duty.

In another decided case, work of peon, sweepers etc. is held to be unskilled

labour.

Skilled Work
After the amendment any type of skilled work performed by the employee
will fall within the definition of Section 2(s) of IDA, 1947.

The work of an artist employed by an advertising expert on work which

could be done only by person with artistic talent and requisite technique has
been held to be a skilled work.

Laxmi Devi Sugar Mills Ltd. v. State of U.P. (1955) 2 LLJ 1.

The work of a bench chemist in a sugar mill which consisted mainly of

carrying out chemical analysis and recording results with typing work has
been held to be a skilled work.
Technical Work
The technical nature of work has been added to the definition by the
Amendment Act of 1956.

Pabbojan T Co. Ltd. v. Labour Court 1977 LIC 721.

The work of a personal manager who was a qualified lawyer in giving advice
and guidance to the management with respect to labour laws was held not
to be of technical nature.

Marshall Briganza v. S.R. Sawant (1975) 2 LLJ 189 Bom.

In this case, a film cameraman has been held to be a workman as film

photography is a technical work.

Operational Work
It means an operative person who is to do physical operation by hand or
machines, occupation in productive labour are skilled or unskilled person
employed in any industry. One who operates or works in any industry, trade
or profession a workman in any industry are an artisan or a mechanic.
(Something is wrong with the definition…check!!)

Clerical Work
It is similar with routine stereotype work which does not involve any
initiative, control or dignity.

Punjab National Bank Ltd. v. Certain Workmen (1953) 1 LLJ 368.

In this case, an assistant manager of a bank whose duty is purely of clerical

nature who puts up notes regarding leave and staff matters to the managers
who passed orders on them was held to be doing clerical work.

Distinction between Workman and Contractor

D.C. Works Ltd. v. State of Saurashtra AIR 1957 SC 264.

In this case, SC provided a clear distinction between Workman and

Contractor. The SC observed that the broad distinction between workman
and independent contractor lies in this that while the former agrees himself
to work, the latter agrees to get other persons to work.
 Lay-off
Lay-off has been defined under Section 2(kkk) of IDA, 1947.

‘Lay-off’ means putting aside workmen temporarily. In case of a lay-off, the

employer employee relationship does not come to an end but is merely
suspended. This is so because the employer’s failure or refusal or inability to
give employment is cause by the reasons beyond his control and he has no
intention to refuse permanently to give work to workmen.

Essentials of Lay-off
The analysis of definition of lay-off as provided under Section 2(kkk) of IDA,
1947 brings out following essentials:

a) There must be
i) A failure;
ii) Refusal; or
iii) Inability

Of the employer to give employment to a workman.

In the case of Central India Spinning, Weaving and Manufacturing Co. Ltd.,
Nagpur v. State Industrial Court,{ (1959) 1 LLJ 468 (Bom). } the Bombay High
Court held that the key to the definition is to be found in the words “the
failure, refusal or inability of an employer”. These words make it clear that
the unemployment has to be on account of a cause which is independent of
any action or inaction on the part of workmen themselves.

b) The failure, refusal or inability to give employment must be on account of

one or more of the following reasons:
 Shortage of coal, or
 shortage of power, or
 shortage of raw materials, or
 The accumulation of stock, or
 The breakdown of machinery, or
 Natural calamity, or
 Any other connected reasons.

Management of Kairbetta Estate v. Rajamanickam

In this case, the SC held that ‘any other reason’ must be similar to the
preceding reasons specified in the definition. The SC interpreted the phrase
‘any other person’ by applying the principle of ésjudem generis.

c) A workman who is so deprived of employment must be such whose name

is borne on the muster rolls of his industrial establishment.
d) The workman in question must not have been retrenched.

Classification of Lay-off
As per the definition of lay-off in Section 2(kkk) of IDA, 1947 lay-offs may be
classified on the basis of duration as follows:

a) Lay-off for a day occurring when work is denied within 2 hours of his
presenting himself for work.
b) Lay-off for one half of day occurring when work is denied in the first
half of the shift but the workman is called in the second half of the
shift for doing work.
c) Lay-off for more than a day but not amounting to retrenchment.

Rights of workmen laid off

Section 25-C of the IDA, 1947 provides for compensation to employees laid
off.

It can be divided into the following points:

a) Whenever a workman (other than a badli or casual workman);

b) Whose name is borne in the muster rolls of an industrial
establishment; and
c) Who has completed not less than one year of continuous service
under an employer whether continuously or intermittently, is laid off ;
d) Except for such weekly holidays as may intervene;
e) He shall be paid by the employer for all days during which he is so
laid off, compensation equal to fifty percent of the total of the basic
wages and dearness allowance;
f) That would have been paid had he not been so laid off.

Badli Workman
Badly workman means a workman who is employed in an industrial
establishment in the place of another workman whose name is borne on the
muster rolls of the establishment but ceases to be regarded as Badli
workman if he has completed one year of continuous service in the
establishment.

The right of workmen to lay-off compensation is designed to relieve the

hardship caused by unemployment due to no fault of the employee.

When the laying off of the workmen is referred to in Section 25-C it is the
laying off, as defined in Section 2(kkk) and so, workmen who can claim the
benefit of Section 25-C must be workmen who are laid off and laid off for
reasons contemplated by Section 2(kkk); that is all that Section 25-C means.

Section 25-E provides for the cases wherein workmen are not entitled to
compensation. It provides that no compensation will be paid to a workman
who has been laid off:

a) If he refuses to accept any alternative employment in the same

establishment from where he has been laid off, or in any other
establishment belonging to the same employer;
b) If he does not present himself for employment at the establishment at
the appointed time during normal working hours at least once a day;
c) If such lay-off is due to strike or slowing down of production on the
part of workmen in another part of establishment.

Duties of Employer in connection with a Lay-off

The following duties are cast on the employer in connection with a lay-off:

a) It must be a justified lay-off effected bona fide and not mala fide.
b) The stoppage of work if resorted to during working hours must be
notified by notice put on the notice board and must be in accordance
with the standing orders.
c) The period of detention of workmen if stoppage occurs during working
hours should not exceed two hours after the commencement of
stoppage.
d) If the unemployment caused by lay-off is for a short period, the
unemployment should be treated as compulsory leave wither with or
without wages.
e) If the lay-off is for an indefinitely long period, the services may be
terminated by due notice or payment of notice pay in lieu of notice.
 f) The compensation must be paid at the rates for period specified in
Section 25-C of IDA, 1947.

In the case of Raga Textiles Ltd. v. Their Workers, (1952) 1 LLJ 247 it was
held by the Court that the period of lay-off should not be left indefinite.
 Lock-out
Lock-out has been defined under Section 2(l) of IDA, 1947.

Lock-out means the:

a) Temporary closing of a place of employment; or

b) The suspension of work; or
c) The refusal of an employer to continue to employ any number of
persons employed by him.

Basis of Lock-Out
Lock-out is a weapon in the hands of employers. Lock-out mainly happens
when:

a) There is a labour controversy; or

b) The employer dislikes employees’ activities as a Union.

The employer declares a lock-out in order to compel his employees to accept

the demands made either by him or another employer or to withdraw
demands made by them upon him or by other employees upon another
employer or other employers.

Essentials of Lock-Out
Following are the essentials of a lock-out:

a) Temporary cessation of work or withholding of work in some form.

b) The element of a demand for which the factory is locked out.
c) The intention to re-open or take the workers back if they accept the
demands.

Difference between Lay-Off and Lock-Out

The question whether concept of lock-out can be brought within the
definition of lay-off came up for consideration in the case of Management of
Kairbetta Estate v. Rajamanikam AIR 1960 SC 893 wherein the SC tried to
distinguish between the two concepts of lay-off and lock-out and observed
as follows:
 a) In case of lay-off the employee can be only laid off as per the grounds
contemplated under Section 2(kkk) of IDA, 1947 whereas in case of
lock-out there are no such grounds contemplated.
b) In case of lay-off there is continuity of business whereas in case off
lock-out there is closure of the business temporarily or for the time
being.
c) Nature of the two concepts is entirely different and so are the
consequences.
d) In case of lay-off the employees who are laid off are entitled to
compensation but there is no compensation to employees in case of
lock-out.
e) Lock-out is an anti-thesis of strike, is declared by the employer as the
weapon of collective bargaining and available to the employer to
persuade, by a coercive process, the employees to see his point of view
and to accept his demands while layoff is actuated by the exigencies of
the business.

Similarities between lay-off and lock-out

There are mainly two similarities between the 2 concepts:

a) Both lock out and lay off are of a temporary nature and they are
warranted only in the case of emergency, however the nature of
emergency in each case is different.
b) In both the cases, there is temporary suspension of employees and the
relationship of employment is suspended temporarily.
c) Both lay-off and lock-out are weapons in the hands of employer.

(ADD SECTION 22 and SECTION 23.. EXPLAIN IN OWN WORDS FROM

BARE ACT)
 RETRENCHMENT
Retrenchment has been defined under Section 2(oo) of IDA, 1947.

Retrenchment means discharge of surplus labour or staff in a continuing

industry. It is not necessary that removal of surplus must be only when the
establishment runs in losses. It may operate at any level of profits.

Hari Prasad Shiv Shanker v. A.D. Divlekar (1957) SCR 57 (SC).

The Court in this case clarified the intention of legislature behind using the
expression ‘for any whatsoever’. The court said it means that it does not
matter why the surplus have been discharged if all other requirements of the
definition are fulfilled then it would be retrenchment.

Essentials
1) Termination of an employee by the employer.
2) Termination must be on the ground of surplus labour.
3) Service which is terminated must have capacity to be continued.
4) Termination shouldn’t be because of victimisation of labour or unfair
labour practices by employer.
5) Termination must be for proper reason as of economy, installation of
new labour saving machinery.

State Transport Controller V. Industrial Tribunal (1965) 2 LLJ 376

The question whether particular termination is retrenchment or by way of

punishment for disciplinary action would depend upon the facts &
circumstances of each case.

Laxman Das V. Indian Express Newspapers Bombay Pvt. Ltd. 1977 LIC 823

Workmen participated in a strike, & were victimised, & disciplinary action

was taken against them, division bench of High Court of Delhi held that the
workmen were been punished by way of a disciplinary action and therefore
the termination of their service was held outside the definition of
retrenchment.

It was further observed that the termination of service by way of disciplinary

action is directly in conflict with the termination by way of retrenchment as
the former is by way of punishment while the latter is in the interest of
economy or because the employer didn’t need the services of the workman
who had become surplus.

The definition of retrenchment given in Section 2(oo) of the IDA, 1947 makes
it clear that retrenchment is a type of termination of service and as such
cases which would not amount to termination would be out of the scope of
retrenchment.
The definition specially excludes the following cases of termination as
retrenchment:
a) Termination of service as a punishment inflicted by wasy of
disciplinary action. e.g. discharge of efficiency, or suspension for
dishonesty etc.
b) Voluntary retirement of workmen where they left their services on
receiving notices of retrenchment and did not attend work during
notice period.
c) Termination under expressly stipulated contracts or non-renewal of
contracts of employment on expiry of such contracts.
d) Retirement on reaching superannuation age. Two requirements must
be complied with in order to bring a case under this clause:
 There must be a stipulation on the point of retirement in the
contract of employment; and
 The stipulation must be in regard to the age of superannuation.
e) Termination of service on the ground of continued ill health. E.g. an
employee suffering from senile debility; physical unfitness’ infirmity on
account of old age etc.
Harvillas Kushwah v. Sports Authority of India (1996) 1 LLJ 450 (MP)
Termination on the ground that the employee was suffering from
diabetes was held to be illegal. The court held that mere ill health is
not sufficient to take the termination outside the ambit of
retrenchment. Such termination would amount to retrenchment only
when it is proved that it was on the ground of continuous ill health.
Bisra Stone Lime Co. Ltd. v. Workmen (1992) 1 LLJ 616 (Ori.)
In this case, it was held that continuous ill health suggests that it is
prolonged for a considerable period and that ill health which is
intermittent cannot be termed as continuous.
Retrenchment: how different from other concepts
Compared with strike and lockout, in retrenchment no employment
relationship subsists while in strike and lock out it continues.

Retrenchment is distinct from lay off in as much as in lay off the

employment relationship is not terminated but merely suspended.

(ADD CONDITIONS PRECEDENT TO RETRENCHMENT i.e. SECTION

25N)

strike
Strike is one of the oldest and most effective weapons of labour in its
struggle with capital for securing economic justice. The basic strength of a
strike lies in the labour’s privilege to quit work and thus bring a forced
readjustment of conditions of employment.

Strike is a weapon in the hands of employee; it is adopted as means to

compel the employer to enforce compliance of demands made on their
employer, in such an action the work is stopped by the workmen under
common understanding.

Strike has been defined under Section 2(q) of IDA, 1947.

Strike means cessation of work. It may be resorted to:

a) By a body of persons employed in any industry acting in combination; or

b) A concerted refusal; or
c) A refusal under a common understanding of persons who are or have
been employed to continue to work or to accept employment.

Essentials of Strike
a) There must be cessation of work.
b) The cessation of work must be by body of persons employed in the
industry.
c) The persons carrying out a strike must be acting in a combination.
d) Strikers should be working in an establishment which could be called an
industry within the meaning of Section 2(j) of IDA, 1947.
e) There must be a concerted refusal.
f) Strikers must stop work for some demand relating to employment or
non- employment or terms of employment or conditions of labour of any
person.
Tata Iron and Steel Co. Ltd. v. its Workmen (1967) 1 LLJ 381 (Pat.)
In this case, the Court has held that mere cessation of work does not come
within the purview of strike unless it can be shown that such cessation of
work was a concerted action for the enforcement of an industrial demand.

Cessation of work acting in combination

A combination means an agreement or a concert. In order to establish such
concert there need not be no formal meetings, discussions or even an
interchange or a mutual consent or assent to a common purpose or a cause
of a conduct, but once it is proved that cessation of work or refusal to work
was result of concerted action on the part of the workers or of workers
acting in combination under a common understanding, such a stoppage
even for a short period for two to four hours must fall within the definition of
a strike.

The cessation of work may take any form. It must, however, be temporary
and not for ever and must be voluntary. No duration can be fixed for this.

Objects of Strike
Following are usually the objects behind Strike:

a) Achievement of some economic gains; or

b) Defence of mutual interests; or
c) Promotion of union objectives.

Is strike a fundamental right?

All India Bank Employees’ Association v. National Industrial Tribunal AIR
1962 SC 171.

The question whether the strike is a FR came up for consideration before the
SC in this case. It was contended that when Art 19(1)(c) guarantees the right
to form association, a guarantee is also implied that the fulfilment of every
object of an association so formed is also a protected right and every
association shall effectively achieve the objects for which it was formed
without any interference by law except on the grounds set out in Article
19(4).

The Court rejecting the contention held that the right to form union
guaranteed under Article 19 (1)(c) thus does not carry with it a FR in the
union so formed to achieve every object for which it was formed and
therefore, there is no FR to strike.

B.R.Singh v. UOI AIR 1990 SC 1

Herein, SC observed that the necessity to form unions is obviously for

voicing the demands and grievances of the labourers and therefore, trade
unions with sufficient membership strength are able to bargain more
effectively with the management. This bargaining power would be
considerably reduced if it is not permitted to demonstrate. Strike in the
given situation is only a form of demonstration and the right to strike is not
absolute under our industrial jurisprudence and restrictions have been
placed upon it.

Go Slow Strike
Bharat Sugar Mills Ltd. v. Jaisingh

A committee to consider and report on the question of go slow in industries

was appointed by Bihar Central Standing Labour Advisory Board. The
Committee made several recommendations including one that go slow
without at least a 7 day notice would be treated at par with strike; two the
notice would remain in force for four weeks and it would not be necessary to
notify the exact date of starting the go slow but that the conciliation
proceedings must be concluded within four weeks of the notice; three go
slow due to malpractices by the management would be justified.

All these recommendations were accepted by the Govt. of Bihar by way of a

resolution.

S U Motors v. Their Workmen (1990) 2 LLJ 39 (SC)

In this case, SC observed that go slow is a serious misconduct and a covert

and more damaging breach of contract of employment. It has not been
recognised as a legitimate weapon. Hence, once it is proved the guilty
workmen may face a deduction from wages and even dismissal from service.
(ADD SECTION 22; SECTION 23; EFFECTS OF LEGAL STRIKE; EFFECTS
OF STRIKE ON CONTRACT OF EMPLOYMENT; WAGES ON STRIKE)
(ALL THESE ARE IN CLASS NOTES AND SECTIONS NEED TO BE
EXPLAINED IN YOUR OWN WORDS.)