Chapter

9
Impasse Resolution, Contract
Drafting And Ratification

INTRODUCTION
In this chapter, we continue our discussion of the stages in the process of
negotiation. Sometimes on-going negotiations may hit a roadblock and either
or both the parties - labour and management - may disagree with the offer
on the table. In such a situation, they may either employ pressure tactics or
seek third-party intervention to break the impasse in negotiations. Once the
negotiations are complete and all issues are resolved, the collective bargaining
agreement needs to be written and drafted appropriately, and then ratified
by the constituents on both sides. After ratification, the collective bargaining
contract becomes enforceable and the two sides move to the post-negotiation
stage, which is discussed in the next chapter.

IMPASSE RESOLUTION
Collective bargaining isa long drawn-out process of coming toan agreement
between employers and employees about the terms and conditions of
employment. There can arise several issues during negotiations, over which
either party is unwilling to compromise. This leads to an impasse in the
negotiations, and impasse resolution becomes one of the stages of negotiations.
A bargaining impasse occurs when the two sides negotiating the terms
and conditions of employment are unable to reach consensus on a collective
bargaining agreement and become deadlocked. At this time, either side can
typically make it known that they have reached an impasse, signaling that
they are unable to resolve their differences through bilateral negotiations.
An impasse occurs when it is impossible to reach an agreement on all or
some of the bargaining proposals because the parties are so far apart in their
expectations and requests.
just due to h
An impasse is harmful for both parties involved, not
resulting delay in negotiating a mutually beneficial agreement, but also due
lockout initiated by either ids
to the various economic costs of any strike or earliest
Hence it is in their mutual interest to resolve an impasse at the
 150 Collectire Bargaining and Negotiation hau

CAUSES OF AN IMPASSE
A deadlock in negotiations may arise on account of a dispute related to
(a) Economic causes: Where the disputes revolve around wages,bone
allowances, retrenchment, automation, leave and so on.
(b) Managerial causes: When there is little scope for self-expression, non
fulfilment of social needs and lack of communication.
(c) Political causes: When political compulsions lead to agitations by
unions controlled by political parties.
Methods of
inpasse Resolution

Union Bargaining Management Third-party Resolution

Pressures Bargaining Pressures Mechanisms

Strike Lockout Mediation and

Conciliation

Picketing
Hining Non-union Investigation by a
Workers Court of Inquiry
Boycott
Replacement
Arbitration
Employees
Slow-down

Sick-out Adjudication

Figure. Methods of Impasse Resolution

METHODS OF IMPASSE RESOLUTION

If labour and management have reached an impasse, either or both sides can
make use ofcertain tactics in an attempt to break the impasse. Impasse is oniy
a temporary deadlock, and exists until a change in
circumnstances indicates
that an agreement may be possible.
An impasse may be broken by employing:
1. Union Bargaining Pressures: The labour union may resort to wo
stoppage or strikes to put pressure on employers.
may, throug
2. Management Bargaining Pressures: The managementsuppress unio
several pressure techniques, exert a show of force to
demands. between
Resolution Mechanisms: When disagreements the
3. Third-Party undulv prolonged and serious, t
labour and management become
may seek third--party intervention to resolve the impasse.
parties
Impasse
Resolution, Contract Drafting and Ratification 151

The basic objective of most of these tactics is to force the other party to
alter or redefine its bargaining zone so that an agreement can be reached.
fa strike is to put pressure on the management to accept the
The goal of
proposed contract. Similarly, the goal of alockout is to put pressure on the
unionto accept the contract. When all else fails, the parties can seek external
help. These m
methods of impasse resolution are discussed below.
UNION BARGAINING PRESSURES
The labour union may resort to strikes, picketing,, boycott or slowdown in
onier to exert pressure on the management to agree to their demands, or at
the verv least, to re-start the negotiations that have reached an impasse.
(a) Strike: As per section 2(q) of Industrial Disputes Act, 1947, "strike"
means a cessation of work by a body of persons employed in any industry
acting in combirnation, or a concerted refusal, or a refusal, under a common
understanding of any number of persons who are or have been so employed
tocontinue to work or accept employment. Whenever employees want to go
on strike they have to follow the procedure provided by the Act otherwise
their strike is deemed to be an illegal strike.
According to Flippo, "a strike is a concerted and temporary withholding
of employee services from the employer for the purpose of exacting greater
concessions in the employment relationship than the employer is willing to
grant at the bargaining table."
holds is the potential fora strike.
The most potent weapon that the union bargaining items
Most strikes are triggered by impasses over mandatory
such as salaries and wages.
not always clearly differentiated from
There are various types of strikes,
one another:
recognize
Recognitional strike: This is a strike to force the employer to
(5
and deal with the union.
2011, workers went on strike at Maruti Suzuki India's
Example: In June recognition of a new union - Maruti
Manesar plant, demanding the
Union (MSEU) - formed by those working at the
Suzuki Employees other things.
Manesar plant, among for. demanding better wages,
strike: This isthetypical strike,employer js willing to grant.
Mi) Economic workng conditions than the
hours, and of Coal India Limited,
2017, five centraltrade unions
Example: In almost 90% of the workmen had declared a three-day
May
representing the merger of the Coal Miners Provident
against
strike to protest
Employees Provident Fund and for expediting salary
Fund with the
negotiations.
 Collective Bargaining and
152
Negotiation Skil s
(ij) Wildcat strike: When a strike is not authorized by the labour
it is termed a"wildcat strike" and is usually undertaken union,
to a perceived injustice on the part of management. response
Example: In June 2017, more than 5,000 employees of Nalco
and power plants resorted to a wildcat strike at thesmelter andsmelter
plants in Odisha protesting an alleged move by the Centralpower
Government for fresh disinvestment in the PSU major. About 3080
employees and labourers joined the 24-hour strike by locking the main
gate of the refinery in Damanjodi.
(iv) Sit-down strike: In asit-down strike, workers remain in their place
of work by "sitting down" at their stations, but they do not work
The objective is to prevent employers from replacing the workers or
moving the production to another location.
Example: In June 2011, around 2,000 workers engaged in a wildcat sit
down strike at Maruti Suzuki factory in Manesar. The workers gave
no notice to management, they stopped production completely and
around 2,000 workers stayed inside the factory for nearly two weeks.
(y) Quickie strike: In a quickie strike, workers remain in their place of
work, but they stop work for a brief period, that is, for afew minutes
or a few hours.
Example: In December 2000, temple employees in 36,000 odd temples
in Tamil Nadu went on a day's stay-in strike in support of their 15
point charter of demands. Poojas, which were performed on ticket
basis, could not be conducted as the employees did not issue the
tickets. Around 435 guides attached to the AIl India Pilgrim Guides
Association, Rameswaram also participated in favour of the temple
employees.
wi) Sympathetic strike: It is a strike by workersof an establishment who
are in sympathy with striking workers of another employer. ThIs S
done to put pressure uponthe government to adopt measures to fulfil
the demands of the workerS, whether
striking or not.
Example: In June 201lat the Maruti Suzuki India (MSI) plant in Manesal
around 1,000 workers from different firms in the Gurgaon-Manes
industrial belt gathered at the gate of MSI's Manesar plant to expP
solidarity with the workers of the striking union Maruti Suzuki
Employees Union (MSEU).
i) Hunger strike: A variation of the strikes is when protesting workers
go on a hunger strike to force the management to agree totheir
demands.
Ltd's
Example: In April 2014, workers at the Toyota Kirloskar Motor
hunger
(TKML) two plants near Bangalore resorted to an indefinite
 Resolution, Contract Drafting and Ratification 153
apasse

strike. Thirty oftheover 4,000 striking workers were on

hunger strike,
demanding reinstatement of 30 suspended workers and withdrawal
of company demand that workers sign individual undertakings.
Example:InJuly 2016, workers belonging to different automobile sector
workers' unions held a day-long hunger strike outside mini
in Gurgaon demanding renstatement of over 150 suspended workers
secretariat
Bellsonica Auto Coponent India Private Limited. Besides
pallsonica workers union, the workers of various other unions
including Maruti, Moto Corp, Auto International, and Honda also
took part in the eight-hour-long hunger strike, as a show of sympathy
for the striking workers.
wi General strike: Generl strikes are in the nature of political strikes, tom
where the worker unrest is not motivated by an industrial dispute, stile
but may be part of a revolutionary movement or to express, support
for a particular political cause. These strikes are also called bandhs.
General strikes have a very wide coverage extending over a number
of industries, regions and employers. The degree of generality and
the extent of coverage may vary considerably from strike to strike.
Example: On 2 September 2016, an estimated 150 million to 180million
Indian public sector workers (represented by a total of ten trade
unions) went on a 24-hour nationwide general strike against Prime
Minister Narendra Modi'splans for increasing privatization and other
economic policies. Many government-run locations and transportation
services were closed. The strikers also protested in favour of social
security, universal healthcare, and an increased minimum wage. The
strike mainly took place in states where opposition parties were the
the work-to-rule
most influential, such as Karnataka straPeTules
and Kerala.
nLey
Work-to-rule strike. I U n y emethod,employees no
20 not stop work but rather perform their work strictly in accordance ey
to considerable Hhat
With the stipulated rules and procedures. This leads
In some
slowing down of the work if the rules are strictly followed.
and
DerVices such as banking, insurance, post and telegraph work-to-rule
resorted to
bovemment offices, employees have often
method for the fulfilment of their demands.
Neyveli Tamil
Lignite Corporation,decided
Example: July strike for 13 days, returned to work but,
In 2013,
Nadu, who were on
employees of
eight-
to adhere to the work-to-rule procedures. The rules stipulated
between for
hour shift for employees with rightful breaksandin workers were
refreshment. Prior to the strike, the employees union
shift obligation. Theand
beyond their
putting in extra work daily the mines
and the workforce in tea/tiffin break,
the
announced that employees unfailingly take the
thermal Power stations would
 Collective Bargaining and Negotiation Su
154
also reiterating that it would not be a vengeful act but arightful act
under the law."
on the part of the emplovees as provided
(b) Picketing: During a strike, workers representing the union frequently
patrol in front of the entrance to the employer's facility with signs explaining
picketing. The picket, a line?
their reasons for striking. This action is calledbusiness, helps keep a plant
strikers who patrol the empiover's place ofpurpose of picketing is to elicia
building site closed during a strike. The management.
sVmpathy for the union and to intimidate
labourers locked
Exampie: In the June 2017 Nalco strike, employees and
normal business operations
the main gate of therefinery in Odisha to hamper
by employees and other
(c} Boycott: A bovcott is the combined refusal two types
interested parties tobuy or use the employer sproducts. Ihere are
of bovcotts:
(i) Primary Boycott: Aprimary boycott involves only those parties
directly involved in a dispute. The union exerts pressures on members
members
to avoid patronizing an employer, and levying fines against
that do.
directiy invoved
(ii) Secondary Boycott: This involves a third party not persuade
in adispute. For example, an electriciarn'sunion can retailers
not to buy employer's product.
Exampie: In July 2012, a global boycott, "Hyatt Hurts" was launched bv
Unite Here, a coalition of union members in the hospitality industry, protesting
exploitation of its housekeeping workers by Hyatt Hotels, and askingi
customers to boycott Hyatt. By October 2012, workers in Hyatt Hotels
India, the UK, Israel and the Philippines went on strike.
(d) Slow-down strike: A slowdown, or "go-slow" occurs when instead
of stoppage of work, workers perform their jobs at a much slower pace than
normal. Unions engage in a slowdown instead of astrike, because the workers
still earr pay, while in astrike they do not. Slow-down strikes are commo
in the Indian sugar industry during crushing season and in docks duriy
heavy pressures for unloading goods from ships.
Example: Labour unions at Honda Motorcvcle & Scooter India (H
expirvo
plant at Gurgaon started a 'go slow' strike in October 2009 after the tothe
the agreement with the management signed in September 2006. Due
stir, the company lost around Rs 300 crore (Rs 3 billion). members
(e) Sick-out: Avariation on the slowdown occurs when union
maval
agree to call in sick in large numbers on certain days. Employees
stage a walk-out which is an unannounced refusal to perform work declara
and
Example: In May 2012, over 400 Air India pilots reported sicktreatment ov
a protracted strike demanding wage parityfor and preferential Dreamlier
Indian Airlines pilots, with respect to training flying the Boeing
 Re.solution, Contract Drafting and Ratification 155
Impasse

purchased by the government. The strike went on for 5 days and caused a
reported,
loss of Rs. 70 crorestothe exchequer, in addition to theinconvenience
passengers. Eleven pilots had also sat on an indefinite hunger strike and
to hospitalized later. The strike was called off at the High Court
hadto be and assurance that Air India management would address the
intervention
pilots' grievances.
Example: In March 2011, about 900 workers at General Motor's India Ltd.
(GM) Halol plant
located in the western Indian state of Gujarat walked out
their iobs during the second production shift, to oppose brutal working
part in a dharna
conditions in the factory. Workers later also took
ldemonstration) outside the factory gates.
loss of profit
There are several costs associated with a strike. There is a
customers, cost of hiring and
due to stopped production, legal costs, loss of employer
training replacements, etc. When any type of strike occurs, the
should have a well thought-out plan for functioning during the work stoppage.
the customers and
Provisions may have to be made regarding notifying employer's side to the
suppliers, issuing statement to the press, explaining
workers, etc. Employers must
employees, paying off dues of the striking
unions in company decisions, and
know and follow the contract, involve disputes.
prevent
communicate with transparency, in order to
EMPLOYERBARGAINING PRESSURES
overcome a
employers also use a number of tactics designed to lockout of
At times, terms. These may include the
Dargaining impasse on their employees.
hiring non-union employees, and hiring replacement access to
employees, refusal by the employer to
allow
A lockout is a sometimes literally,
(a) Lockout: The employees are,
employees to the workplace. doing their jobs, and thus, stop from
from
locked out and prohibited employer normally halts operations with
getting paid. Because an use in resolving bargaining
sees only limited
this tactic, the lockout
impasse. Kirloskar Motor Ltd's (TKML)
at the Toyota lock-out,
Example: In April2014, company lifted an eight-day long conduct
Bengaluru plants,the each worker sign a "good
followingwhich it insisted
that
The lockout was lifted atter
returning to work. department.
undertaking" before talks conducted by thelabour maintain
tripartite management may
three rounds of Workers: The
Non-union non-union employees such as supervisors
(b) Hiring
by letting
the
employees. This tactic is applicable only
operations where very
the duties of striking automated or routine and
performoperations are highly the strikers' jobs.
perform
where
is
requiredto
little training
 Collective Bargaining and
156

Example: During the 2000 strike of Telephone and

Negotiation Skil ,
Telegraph Workers
Union of India, supervisors and administrators were able
to
phone lines open and forced the striking employees back to keep
with no pay increase. work
(c) Replacement Employees: Management may occasionally u.
temporary workers or replacements for strikers. These
are called strikebreakers. However, conflictmay erupt
betweenand
individuals
strikebreakers attempting to enter an employer's workplace
picketers representing theinterest of the union atthe emplover's ot
Example: n September 2017, over 2 lakh Maharashtra Anganwadi
women struck work demanding their wages to be pegged to service
vears and a minimum wage of Rs. 7,000. The government directed
district officials to find replacement workers from self-help groups to
break the strike.

THIRD-PARTY RESOLUTIONS
Sometimes the various tactics described above are successful in resolving the
impasse. For instance, after workers have gone out on strike, the organization
may change its position and indeed modify its bargaining zone to
accommodate potentially larger increases in pay. After experiencing astrike,
the organization may realize that the costs of failing to settle are greater than
it believed and so is willing to give more to avoid a longer strike (in other
words, the comparny's resistance point has shifted).
But in many situations, when disagreements between labour and
management become serious, third-party intervention measures may b
sought by the union and/or management. As opposed to the bargainn
pressure tactics used by the union or management, third-party interventios
are a more formal method of dispute resolution.
least
Third parties can do much to promote an agreement. They can at
keep the two parties talking. They can take the initiative in calling conferene
and keep reminding the disputants about the desirability and inevitab1y
reaching an agreement at some time or the other. under
In India, upon occurrence of a deadlock or impasse in negotiations,
dealt with
Section 10 of the Industrial Disputes Act, 1947, the matter can be make
by informing the government about the dispute, which may further
use of the following techniques for resolving the dispute:
(a) Mediation and Conciliation
(b) Investigation by a Court of Inquiry
(c) Arbitration
(d) Adjudication
 Collecdve
156 ganing nd
Evample: During the 2000 strike of Telephone and
supervisors dnd Negtu
Ntadmirlkinnigntrempl
ators
Union of India, and tOrced th.
phone lines open
with nopay
increase.

Replacement Employees:
oyee
Management
(c) temporary workers or replacements lor strikers may
strikebreakers. However, contlict
are called
employer'mayset bo
to enter an
strikebreakers attemptinginterest of the
picketers representingthe union at t he
Example: In Septenber 2017, over 2 lakh
em pwlINitkpelracso
women struck
years and a minimum
work demanding their wages to
wage of Rs. 7, 000.
The Maharashlra Ang
be
peged od
district otticials to
break the strike.
find replacement workers from
goverslí-nhmentelp g
THIRD-PARTY RESOLUTIONS

Sometimesthe various tactics described above are successful in

impasse. Forinstance, after workerss have gone out on strike, thhe ong
and indeed modify its
resoltn
change its position
may bargaining
accommodate potentially larger increases in pay. After experiencingzs
the organization may realizethatthe costs of failing to settle are gat
more to avoid a lonoerh
it believed and so is willing to give
has shifted).
words, the company's resistance point
lah.
But in many situations, when disagreements between
intervention measun
management become serious, third-party
sought by the union and/or management. As opposed to the hury
third-party intn:
pressure tactics used by the unionor management,
resolution.
are a more formal method of dispute
Third parties can do much to promote an agreement. Thev at can a
in calling
keep the two parties talking. They can take the initiative
desirability and inevtah
and keep reminding the disputants about theother.
reaching an agreement at some time or the
In India, upon occurrence of a deadlock or impasse in negotahs.
can de
Section 10 of the Industrial Disputes Act, 1947, the matter hurth:
which mav
by informing the government about the dispute,
use of the following techniques for resolving the dispute:
(a) Mediation and Conciliation
(b) Investigation by a Court of Inquiry
(c) Arbitration
(d) Adjudication
 Resolution, Contract Drafting and Ratification
bmyasse 157

(i) By Labour Court ssoggesioy

(ii) By Industrial Tribunal

(ii) By National Tribunal
MEDIATION AND CONCILIATION
The formal grievance resolution process of mediation and conciliation involves
the use of neutral third-party mediators/conciliators who work closely with
anarties in order to facilitate an agreemernt. Conciliation is the first process
adopted by the parties after failure of bilateral negotiations.
Whocan conciliate?
The goverment maintains a system of conciliation officers at the district,
regional and state level, to serve as conciliation officers. People who serve as
Conciliation officers are recruited by means of a public service examination,
and must have the basic qualification of a bachelor's degree, and maybe a
diploma in industrial relations or social work.
Duties and Responsibilitiesof Conciliation 0fficer
The conciliation officer is empowered to inquire into the dispute and suggest
possible solutions to bring the parties into an agreement. His/her responsibility
is basically an effort of mediation, that is, to facilitate (and not decide) a
negotiated solution by using reasoning and persuasion, suggesting
alternatives, etc.
The mediator may make suggestions and informed recommendations.
To be effective, the mediator must have the trust and respect of both parties
and have sufficient expertise and neutrality to convince the union and emplover
that she or he will be fair and equitable.
Process of Conciliation
within fourteen
process of conciliation must be completed than that.
Statutorily, the
days. But in practice, it goes on for a considerably
longer time
may call for severa!
1. At first. the district-level conciliation officer ascertain each party's
conciliation meetings of the parties, to try to compromises
bargaining and actual positions and to suggest suitable
dispute.
in order to settle the the officer
the conciliation efforts are not successful, may:
2. If
a later date, or
decide to call meetings at
with his recommendations, to the
submit a failure report,
government
158 olleeie Burgaininy and
3. After a failure report is filed, the dispute moves up the
Negotiaion
conciliation officers. The regional level conciliation
hierarchy
officer nay calloha
conference of the parties and try to mediate the dispute,
4. Afailure at the regional level implies that the
the state level will become involved in the dispute.conciliation
officer:
5. Afailure of conciliation proceedings at the state level
state labour minister will become involved in the implies that
disputeand authors
disputes get settled at this level, mainly due to the power Nornally,
exercised bythe minister that forces the parties to accept a reasnabl
compromise.
6. A failure at the state level implies that the
will reter the dispute for adjudication. appropriate government
Advantages of Conciliation
" Strikes are prohibited: The major advantage of
the government has the authority to prohíbit anyconciliation
is that
strike during the
pendency of conciliation proceedings. Even if a strike is not prohitited,
the strike that continues during the pendency of
concil:at1ion
proceedings becomes an illegal strike. In an illegal strike, worters
will not receive any payment, even if it is found that the strike would
have otherwise been "justified".
Acts as a deterrent: The fact that conciliation talks are in
as adeterrent to workers from taking any direct progress acts
ends. action to gain their
Binding settlement: If a settlement is reached in the course of
conciliation proceedings, it is a binding settlement, thereby defusing
the tension and allowing the parties toproceed with normal
activities. business
Disadvantages of Conciliation
Time-consuming: The process of conciliation is extraordinarily Um
consuming, and may go on for months. In certain States the time
between conciliation conferences can be more than a month. If a dispu
goes through all the stages of the conciliation procedure, it coud
easily take six months for the dispute to be resolved. This long tim
gap leads to tensions at the work place.
Shortage of time: Conciliation officers do not have enough time
thoroughly study the disputes and to offer solutions. a strike
When quickh
by workers is expected, the conciliation officer may try to
arrange meeting between the parties, but the large number of dispute
awaiting the officer's attention makes it ineffective.
 Collective Bargaining and
158
Negotiation Skil s
3. After afailure report is filed, the dispute moves up the
hierarchy
conciliation officers. The regional-level conciliation officer may callofa
conference of the parties and try to mediate the dispute.
4. Afailure at the regional level implies that the conciliation officer at
the state level will become involved in the dispute.
5. Afailure of conciliation proceedings at the state level implies that the
state labour minister will become involved in the dispute.
disputes get settled at this level, mainly due tothe ppower and Norauthority
exercised by the minister that forces the parties to accept a reasonabie
mally,
compromise.
6. Afailure at the state level implies that the appropriate government
will refer the dispute for adjudication.
Advantages of Conciliation
Strikes are prohibited: The major advantage of conciliation is that
the government has the authority to prohibit any strike during the
pendency of conciliation proceedings. Even ifa strike is not prohibited,
the strike that continues during the pendency of conciliation
proceedings becomes an illegal strike. In an illegal strike, workers
willnot receive anypayment, even if it is found that the strike would
have otherwise been "justified".
Acts as a deterrent: The fact that conciliation talks are in progress acts
as a deterrent to workers from taking any direct action to gain their
ends.

Binding settlement: If a settlement is reached in the course of

conciliation proceedings, it is a binding settlement, thereby defusing
the tension and allowing the parties to proceed with normal business
activities.

Disadvantages of Conciliation
Time-consuming: The process of conciliation is extraordinarily time
consuming, and may go on for months. In certain States the time
between conciliation conferences can be more than a month. If a isp
goes through all the stages of the conciliation procedure, it could
easily take six months for the dispute to be resolved. This long
gap leads to tensions at the work place.
to
Shortage of time: Conciliation officers do not have enough timestrike
a
thoroughly study the disputes and to offer solutions. When quickly
by workers is expected, the conciliation officer may try to
dispute
arrange meeting between the parties, but the large number of
awaiting the officer's attention makes it ineffective.
 Resolution, Contract Drafting and Ratification 159

Shortage of manpower:: Depending upon the concentration of industry

inthe area, as many as 200 disputes may arise simultaneously in a
heavily industrialized district, with only two or three conciliation
officers to handle the workload
Lack of adequate training: Conciliation officers generally do not
receive any organized traningin conciliation. Though they may be
sent to oCcasional training programs, most of the training is actually
done on the job.
Iack of commitment, morale and motivation
Guaranteed job security and promotions based on length of service
provides little incentive for a conciliation officer to take a great
interest in his job.
There is no formal system of performance evaluation (in terms of
disputes settled arnd time taken) tied to any reward system.
There is no professional code of ethics or performance for
conciliation officers. Occasionally, they might take aspecial interest
when it is a newsworthy dispute, hoping to be mentioned in the
newspaper if a satisfactory settlement is reached.
Union leaders and management representatives of large
the regional
organizations prefer having their dispute settled at conciliation
commissioner level. Consequently, district-level
officers get only the small and relatively insignificant disputes,
motivation.
which further affects their morale and
viewed as a totally
Lack of neutrality: Conciliation officers are rarely
mpartial third party.Union presidents, who are invariably politicians,
conciliation officers by threatening
POsSess enormous power over advancement. Consequently, the
transfers and interfering with career
Conciliation officers tend to try to stay on the good side of these
and this affects their neutrality in dispute settlements.
politicians,

INVESTIGATION BY CoURT OF INQUIRY

1947, empowers the government to
Section 6 of the Industrial Disputes
for
Act,
investigation into any matter pertaining to
dispute
court of inquiry, inquire into the
an Ind d Dispute. The court's only purpose is to
an
Industrial
and submit its findings to the appropriate government.investigation, or afact
undertakes an
In other words, the court of inquiry collecting evidence from all
and relevant
finding exercise, by conducting hearings
parties associated with the bargaining agreement, as well as any other,
Outside sources.
160 Collective Bargaining and
Negotiation Skil s
Upon conclusion of their investigative process, they present the facte
report to the government. The court of inquiry has a time limit of six
from the commencement of theinquiry within which it must submit months
to the government. its report
Advantages of Investigation by Courts of lnquiry
Acts as a catalyst: While the recommendations of the investigation
are not legally binding on the parties tothe agreement, their
are usually made available to the public. Not only are the twO reports
parties
likely to modify extreme positions on the basis of additional facts
but the power of public opinion can be brought to bear and act as a
catalyst for breaking the inmpasse.
Buys time: Courts of inquiry are used by the government as a means
to buy time or to cool off hot-headedness that might arise from an
industrial dispute.
Disadvantage of Investigation by Courts of Inquiry
It is merely a fact finding exercise about the causes of an industria' dispüte,
and lacks finality.
ARBITRATION
Arbitration is a procedure in which a neutral third party, called arbitrator,
collects the facts from the primary parties and makes a decision that is usually
binding on labour and management. The arbitrator, in fact, has the authority
to dictate the agreement.
Types of Arbitration
In India, there are two types of arbitration:
Voluntary (requested by the parties): When the disputing partes
voluntarily request arbitration in the matter of a dispute, it is calleu
'voluntary arbitration.
Compulsory (forced on the parties by law or contract): When tne
government refers the dispute to arbitration without consulting the
concerned parties, it is known as 'compulsory arbitration'.
Whocan arbitrate?
To 'arbitrate' means to give judgement or "to make decision'". The arbitrator
can be

a government agency, or
aprivate individual
 ContraCI Drafting and Ratification 161
Resolution,
Althoughthe government makes industrial tribunals and presidents of
available as arbitrators for private sector industrial disputes,
courts
abour
rarely used. Rather, parties usually select arbitrators whom they
are These arbitrators tend to be well known public figures
welland trust.
field.of law, economics, civil services, etc.
inow
the
in
promotethe idea of voluntary arbitration as a substitute for strikes
To
lock outs, the Government of India formed the National Arbitration
Pronotion Board (NAPB) in July 1967, to constantly monitor and provide
and

neessaryguidelinesto promote arbitration. The various employers and unions

approach and seek assistance of these Boards for the choice of arbitrator
can connected with arbitration.
any other matter
andin
ProcessofArbitration
of the Industrial Disputes Act, the parties may agree to
Under section 10(a) the dispute is referred for
obor the dispute to arbitration at any time before
adjudication.
an "arbitration agreement" specifying
The parties are required to signand the names of the arbitrator or
the terms of the reference
arbitrators.
the government has the power
Once the arbitration agreenment issigned, lockouts
prohibit any strikes and or the continuation of
to terminate and
connection with the dispute.
any strikes and lockouts in
arbitrator requests both parties to support their
Normally, the
writing. The arbitrator studies the case and arguments
arguments in
put forward by both parties. party for
further evidence is needed, the arbitrator may call either
If
after which he gives his decision or award.
a hearing, law to be passed to the
is required by
Ihe arbitration award award is then published in
the official
Ppropriate government. The legally valid.
government gazette thus becoming
Advantages of Arbitration and healthyrelations between
Mutual consent leads to building oftrust
the two parties.
adjudication, relatively informal and
to court system and may
The Process is, compared take place outsidethe
of evidence or
flexible. Arbitration may as rules
procedures such
not be subject to courtroom
probably
andis
appeal. minimum cost and time,India.
Arbitration provides justice at dispute settlementin
the quickest method of labour
 specifies
choice andgovernment
action adjudication The Types statutes.
state Labour which
Schedule The for theWhen consent
Adjudication
Framework withAdjudication ofDisputes
interpretation
Section Adjudication(a) Industrial
National
TribunalTribunal
(c) (b)
Labour
Court
(a)
Industrial concerned government AdjADJUDICATION
udication authority
normally itis
DisadvantArbaitgesrationof 162

restricted the
is taken the the of, Adjudication
Courts, is the There
7 t
ActThe .of
h e government consent the Ac t binding
resolves well-defined
management There toThe
an
qualifications of by or may of or used is labour
the the industrialDisputes
parties, disputing
of Industrial
by are arbitrator is parties
any means the tgeneral
can onhe asly
persons
only employer
Act
standing
of refer
Labour
Court:by
the court, very lack a rarely
it
refers
disputing refer a code wil
to
provides
for
includes
scheduledisputes
disputes: Act, known is parties. other parties.
Tribunals
Industrial last few of
the a
resort ot industrial
infludifficult
ence
n of a is
agree
the orders. 1947 the corresponding mandatory government trained
ethics.
Presiding for his related parties,When
dispute
as
dispute preferred on
with
the provides or Dispute for
workmen, compulsory the the
sufficient
judicial
experience the to National impasse by tribunals, body
constitution to
mattersdisciwijpthlinaUnder to it
dispute
adjudication is settlement
referred arbitrators
bodi
primarily
arbitrator
ie e s choice Collective
Officer matters aadjudicationcalled authorities both of
iconnect
l egal ed Section three-tier Tribunals resolution. adjudicatur
etc.
professional ofBargaining
of adjudication is managementand
to which unions the
because
a of covered 10c) 'v oluntary referred of
LabourLabourlockouts machinery without wi th under Industrial
under by act
arbitrator.
in of pasSing The as and
the the . adjudiatiato or
adjudication. arbitrators
Court Court and consutny without the the
Disputes Negotiation
ThatN strike Secun Act th for
the
analonsIndsha anlabour
award
tha
feel
the b and w Ski
 162 Collective Bargaining and Negotiation Skhill.

Disadvantages of Arbitration
The parties rarely agree on the choice of the arbitrator. Agreement .
to an arbitrator is difficult primarily because unions feel tha
management will influence the arbitrator.
There is a lack of a trained body of professional arbitrators with
well-defined code of ethics.
There are very few government bodies which act as arbitrators ie
the labour court, industrial tribunals, etc.

ADJUDICATION
Adjudication is generally not preferred by both management and labour and
is normally used as a last resort for impasse resolution. The adjudicatory
authority resolves the Industrial Dispute referred to it by passing an award,
which is binding on the parties.
Adjudication means a mandatory settlement of Industrial Disputes by
Labour Courts, Industrial Tribunalsor National Tribunals under the Industrial
Disputes Act or by any other corresponding authorities under the analogous
state statutes.
Types of Adjudication
The government can refer the dispute to adjudication with or without the
consent of the disputing parties. When the dispute is referred to adjudication
with the consent of the disputing parties, it is called 'voluntary adjudication'.
When the government refers the dispute to adjudication without consulting
the concerned parties, it is known as 'compulsory adjudication'.
Framework for Adjudication
The Industrial Disputes Act, 1947 provides a three-tier machinery for the
adjudicationof industrial disputes:
(a) Labour Court
(b) Industrial Tribunal
(c) National Tribunal
(a) Adjudication by Labour Court: Under Section 10(c) of the Act, the
government may refer disputes related to matters covered in the Second
Schedule of the Act. The schedule includes matters connected with disciplinary
action taken by the employer or his workmen, illegal lockouts and strikes
and interpretation of standing orders.
Section 7 of the Act provides for the constitution of Labour Court
The
specifies the qualifications for thePresiding Officer of a Labour Court.
choice is restricted only to persons with sufficient judicial experience. A
 Resolution, Contract Drafting and Ratification 163

phaminingall,relevant documents and conducting detailed hearings complete

examination of witnesses, the court issues its decision.
the
with
Labour courts are used extensively in India in connection with all matters
qoncerningthessecond schedule. Decisions of the labour court may be appealed
either partyin the high court of each state.
bs labour court can take considerable time for
Matters referred to the
resolution. For instance, the labour court generally takes a minimum of three
to make a decision. Generally however, employers and
four months
workers refer a
matter to alabour court if the dispute involves points of law
ifthey do
not want to exercise direct protest means such as a strike or
or
lockout. Therefore, despite the delay, the labour courts have a very important
settlement method.
oolingeffect" and are of great value as a
Industrial Tribunal is
(b) Adjudication by Industrial Tribunal: The
industrial disputes in connection
constituted by the government to adjudicateThird Schedule of the Industrial
uwith matters referred to in the Second or enforcement of contracts of
Disputes Act, for instance, revision of wages, tribunals have a
industrial
personal service, etc. Compared to labour court,
wider jurisdiction.
with sufficient judicial
ATribunal shall consist of one person only,
Government. The appropriate
experience, to be appointed by the appropriateassessors to advise the Tribunal
Government may also appoint two persons as
in the proceeding before it.
Adjudication by National Tribunal: National tribunals are tribunals
(c) adjudicate matters of national
apponted by the central government to
toaffect industrial establishments in
mportance, or disputes that are likely
Government can refer an industrial dispute
than one state. Only Central only
more
adjudication to the NationalTribunal. Similar to Industrial Tribunal,
sufficient
1Or with
person is to be appointed by the Central Government,
e
judicialexperience. with the employer/employee
wide powers in connection
ne lribunal has wages to be paid in an
even recommend
Contractual relationship, and can
tribunal has been referred to, no labour court
establishment. When a national adjudicate upon such matter.
or industrial tribunal shall have any ju°risdictionto

Rdvantages of Adjudication legally binding judgement by

to a
It is a
very formal process which leads prescribe a specific procedurefixing
to be
which parties have to abide. Rules
the claimstatements,
the parties,filing filing of affidavits,
fol owed, such as serving noticesto
dates for examination and cross-examination of
arguments
witnesses,
andthe submission
ofaward.
recording of evidence,,hearing of oral
164 Collecive Bargaining and
Disadvantages ol Adjudication
Negotiat on Skil
Both management and labour generally do not favour
because it restricts their use of force or direct action.
The system of dispute settlement adopted by these bodies,
quasijudicial in nature, is essentially adversarial as
ndjudwhiicacthion,
are
inquisitorial.
di
" Adjudication involves considerable time, and
stinguished from
waiting for an
adjudicated decision might worsen the industrial relations
at the factory. situation
" The functioning of adjudication machinery in India is
satisfactory, due to the delays involved and the ineficient not very
implementation of the awards.
In India, the line between the industrial
'adjudication' and 'arbitration' is
very thin. The central theme of the Industrial Disputes Act is
Additionaly, the statutory provision of compulsory adjudicationadjudication.
labour and management to take a very legalistic view of industrialhasrelations
caused
disputes. Conseqkently, there is a marked preference for adjudication rather
than bipartisan methods of resolving conflict.
DRAFTING THE COLLECTIVE BARGAINING AGREEMENT
After both parties have arrived at an informal agreement either in the
initial process or through overcoming bargaining impasse, it is drafted normal/
written contract. The agreement stipulates in formal terms the nature ofintothea
relationship between labour and managemen for the ensuing period ot tme
as agreed in negotiation.
The written form of the agreement usually
conditions of employment, the date from whichconsists of the terms and
duration for which it will remain in operation and theit names
comes into ettect, e
of the signatories
of the agreement.
Drafting an agreement is a difficult task
poorly written contract can undo all the hardfraught with complexities.
work that has been pu
labour and management in reaching a tentative
incomplete agreement. Casualinthe
drafting of the agreement
wording of the contract, thereby leading to disputes critical
may result in omissions
and possible litigation
This also poses a problem in implementing and administering the contract
over the life of the agreement.

DRAFTING THE AGREEMENT - GENERAL PRINCIPLES

1. agreementis
Drafiing by mutual consultation: It is ideal that the
drafted mutually by both parties to avoid confusion.
 not.
been The
rreviewLLOW-
and UP
Oformally 3. 8. 7. 6. 5. 4. 2 Imyas e
termine drafted,the inand Chaptersinto expertbefore Avoid common,
themeaning. managers Simple and might The discussed Clear Issue-based
demands
intact.
bematter be
Annexures: tO Similarly
included.followedOr Important date Definitions:
agreement. the incorporated
clear drafted Resolution,
the that clauses easily more
agreement, of contract sub-headingschapters arise and
ON particular during it legal language: and
commencement in
other and is everyday
implementing general definite at
is Contract
understandable in discussed
whetherapprovalwrit enACTIagreement
two case clauses: mustClear finalized
incorporated definite. thatdrafting
Wherever -
nto contractambiguity:
iheadings: interpreting
ctive
thesides scopeimportant of
pertaining
to chapter. tothe The e
thwriting: point Drafting
by be
colleCONTRACT
a It meaning, Vague
support dispute,
and isdefinitions
stated
describe language, and in
terms both
usually required, and good
agreement. drafting for The language
it. in real
therein
Thesignature agreed and
clauses to The f or the orThe time,
partiens.ing
informallybargai the
coverage the the to in the draft rather ambiguous time:
Ratification
return
RATIFICATION of separate agreement is words th e terms
suitable duration include anthe details Each should of provisions
the to
upon,
such helpful. agreement
by keep As
to
After of earlier thanworkers the more of
agreement provisions consequences various chapter the in the each
the as of an provisions
related be agreerment
a e
thwording the
must the
agreed their the annexures parties.
devoid specialised, agreement.likely contract
the chapter
the express
and covered
contract
in spirit issue
is in
course terms may be the
respectteintveative included. agreement,
upon only collective to
the each clearly Consulting ofthe should avoided.
should
it be
agreement and in
are must clause or
used contain
proposed is language
event of section legal
language the
agr e tentative,
ement be etc. action issue extraordinaryshould by that
it,
intent
accept
constitaublencie es agreemernt.
of stating throughout delineated ambiguity be charter
appended must headings
covered and disputes
breach of should should
of
to to legal a of have simple 165
the be all the the
subjhas ect
or be be the a of
166 Colleetive Bargaining and
Hence a particularly erucial stage inccollective
Negotiiation Skil s
bargainingprocess is Contract
ratification. The agreement/contract becomes official once
and signed by labour and management representatives. approved, ratified,
Ratification is the process by which members of the
bargaining
the union and the employer formally approve the terms of the teans of
agreement that they have negotiated.
The ratification vote happens at the end of collective
collective
bargaining,
bargaining parties have reached a tentative agreement, and set after he
proposed terms in aformal document called 'memorandum of out the
The memorandum of settlement requires ratification by the
unionsettlement
to become effective and legally binding. If they do not approve nembers
it, the
agreement is void, and negotiations resume.
THE RATIFICATION PROCEDURE
The employees, represented by the union, ratify the memorandum of
settlement through a secret ballot vote. Ratification by the employer is through
avote of the board of directors or governing body.
Memorandum Drafting: When the labour union and management
reach a tentative agreement, they draft a memorandum of settlement.
The memorandum of settlement contains all the elements of a final
contract.

Memorandum Review: The parties take some time to review the

memorandum of settlement and reconvene to negotiate final details
and outstanding matters.
Ratification Sought: Upon reaching a final agreement, the labour
union seeks ratification from its union members.
Voting Conducted: All members of the union have the right to vote.
Each person gets one vote. The vote is conducted by secret ballot
The collective agreement is considered "ratified" if a majority ofthose
voting accept the terms of the tentative collective agreement.
There are three possible outcomes:
Acceptance: When the tentative agreement is accepted, the vote
is tallied and management is informed that the parties havea
binding contract.
union may
Rejection: If the tentative agreement is rejected, the resolvethe
demand that the employer resume bargaining to
issue(s) causing member rejection, a strike might be coonsidered
voluntary
or a re-vote could occur - all with the goallof reaching a
binding contract.
Impasse Resolution, Contract Drafting and Ratification 167

Tie: If there is a tie vote, a re-count is normally

sure that the vote is really tied. Additional conducted to be
vote may occur at the same meeting, or another explanation and a re
held to revisit and resolve the reasons for the tie.meeting may be
Agreement Finalization: Once both parties have ratified the tentative
collective agreement, it is finalized and implemented.
REQUIREMENTS FOR EFFECTIVE RATIFICATION PROCEDURE
Honest and Fair Presentation: The representatives must present the
agreement to be ratified honestly, and terms should be described
fairly to the constituents.
Open Communication: The date, time and place of the meeting for
the ratification should be set so that as many employees as possible
can participate and vote.
Proper Conduct of the Meeting:
The tentative agreement should be the only agenda item for the
meeting.
The union representatives must present the agreement in full detail
and answer questions of the employees.
A copy of the whole agreemernt must be available to employees
when they meet to decide whether or not to ratify it. It is ideal
that the agreement is not made available to the employees prior
to the ratification meeting, in order to ensure maximum employee
participation so that they can make an informed decision.
secret ballot
Voting by Secret Ballot: All employees must receive a
tampering.
to vote on the tentative agreement to prevent

SIGNIFICANCE OF RATIFICATION
formalizes the memorandum into a legally binding contract, and
Katification
to the collective bargaining process.
hence gives finality
ratified by the parties concerned, it is not a legally
Until the contract is contract between the parties, and cannot be
enforceable, binding Industrial
Section 18 (1) of the the partiesDisputes
According to to the
implemented. shall be binding only on
agreement
Act, 1947, "an agreement that any collective of
bargaining
agreement." This
implies
all workers an organisation. The
automatically to and signed by
does not apply once approved, ratified,
official
agreement becomes representatives.
management
labour and
168 Collective Bargaining and NeRotiation Shill.
Unions and many employers are, in effect, acting as agents on behalf
of certain principals. Atean of union members bargains on behalf of
the workers. Similarly, a representative team of managers negotiates
its bargainine
for theemployers. Each party is given a "mandate" by have
committee/team. But these representatives may not ultimate
authority to decide some issues referred to collective bargaining and
included in the agreement. These need to be ratified by the respective
principals of both the parties.
" Ratification indicates that the majority of employees are satisfied by
foreseeable future
the terms negotiated, and this implies that for the
be
as specified in the agreement, a cordial working relationship can
carried out.
. The fact that the agreement is terntative until ratified by majority of
the employees makes them feel valued and promotes positive bilateral
relations.
signals that
. Submitting the memorandum of settlement for ratification
additional
the bargaining process has been completed and no
negotiations are being contemplated. This allows the union and the
management to resume work as usual.

QUESTIONS FORREVIEW
1. Explain the procedure of contract ratification.
2. Elaborate on the various steps during actual negotiations stage of the
process of collective bargaining, with examples.
3. What are the various pressure tactics that can be employed by labout
and management to resolve anegotiation impasse? Discuss, wim
examples specific to the Indian context.
4. Explain thetechniques for third-party dispute resolution. agreemernt?
5. What are the guidelines for drafting a collective bargaining