INDUSTRIAL

DISPUTES
Definition

According to the Industrial Disputes Act, 1947; Industrial

Dispute is defined as ‘any disputes or differences between
employers and employers, or between employers and
workmen, or between workmen and workmen, which is
connected with the employment or non-employment or the
terms of employment or with the conditions of labour, of any
person’.
Causes of Industrial Dispute
 Economic Causes

 Political Causes

 Personnel Causes

 Indiscipline
R = (L/M) x 100

R – Severity rate
L – Total number of mandays lost on
account of dispute during the year
M – Total number of mandays
available in the year
 Instruments of Coercion
 Strike

 Economic Strike
 Sympathetic Strike
 General Strike
 Stay-in-Strike
 Slow-down Strike
 Lightening/Wild Cat Strike
 Picketing

 Boycott

 Gherao

 Lock Out
 Effects of Industrial Disputes
Effects on Workers
 When industrial dispute leads to strike, the wages may not be paid to
workers for the strike period. Thus, workers and their families have to face
financial difficulties due to such disputes.

 The rate of bonus also comes down due to disputes as disputes result in
reducing the rate of profitability

 Due to continuous disputes, the employer may introduce lockout and the
workers will have to suffer

 Some workers, particularly temporary workers, may be dismissed during

the period of disputes

 Prolonged industrial disputes lead to industrial sickness and even

closure of the enterprise. As a result, workers lose their jobs.

 Due to industrial disputes, the employers lose sympathy for the workers.
As a result, certain welfare and other facilities may be denied to them
 Effects of Industrial Disputes

Effects on Employers

 The productivity and profit ability of the industrial unit go down due to
industrial disputes

 The quality of production and thereby the market reputation is adversely

affected due to limited interest or non-cooperation from workers during the
period of dispute

 Industrial disputes bring higher labour turnover. Moreover, efficient and

sincere workers may not like to continue with the firm where such disputes
are common

 Spoiled work increases due to indifferent attitude of workers during the

period of dispute

 Industrial disputes affect labour-management relations and this disturbs

the smooth working of the industrial unit.
 Effects of Industrial Disputes

Effects on the Society

 Industrial production goes down. In addition, exports suffer and this

affects the entire national economy

 Industrial disputes lead to shortages and artificial price rise. This affects
consumers and the society at large

 Industrial growth of the country is jeopardized due to large scale

industrial disputes. The expansion programmes are disturbed and the rate
of investment in the corporate sector goes down.
WORKS COMMITTEE
 Works Committee is regarded as the most effective social institution
of industrial democracy and as a statutory body, established within the
industrial units with representatives of the management and workmen,
for preventing, and settling industrial dispute at the unit level.

 The work committee can be formed by any enterprise, employing 100

or more workers.
 These committees deal with day-to-day questions related to
production and employment.

 Until these questions are dealt with satisfactorily at the initial stages,
they may lead to disputes.

 It provides opportunity to both the parties to discuss matters, and

serves as an important machinery for both prevention and settlement of
disputes.
 Conciliation is the “practice by which the services of a neutral third

party are used in a dispute as a means of helping the disputing parties

to reduce the extent of their differences and to arrive at an amicable
settlement or agreed solution” - International Labor Organization (ILO)

 Conciliation is a method of resolving the industrial conflict with the

help of third party, who intervenes in the dispute situation upon a
request by either or both the parties. It is procedure in which the
decision-making function remains the prerogative of the parties to the
dispute as in collective bargaining. The conciliator simply assists them
in their negotiations and decision-making, he resolves the impasse and
removes the bottlenecks – B.R. Patil
 CONCILIATION MACHINERY

Conciliation Board of
Officer Conciliation
 COURT
OF
ENQUIRY
 Arbitration is a process in which a dispute
is submitted to an impartial outsider who
makes a decision which is usually binding
on both the parties.

 Arbitration is a judicial process

 The award of the arbitrator is binding and

rests on equity and justice, i.e., there is no
scope for compromise
 TYPES OF ARBITRATION
 Voluntary Arbitration – implies that the two
contending parties, unable to compose their
differences by themselves agree to submit the
conflict/dispute to an impartial authority, whose
decision they are ready to accept.

 Compulsory Arbitration – is one where the parties

are required to accept arbitration without any
willingness on their part. It leaves no scope for
strikes and lockouts; deprives both the parties of
their very important and fundamental rights.
 Adjudication involves intervention in the dispute by a third
party appointed by the government for the purpose of
deciding the nature of final settlement.

 The reference of dispute to adjudication is at the discretion

of the government.

 When both the parties, of their own accord, agree to refer

the dispute to adjudication ,it is obligatory on the part of the
government to make a reference. When a reference to
adjudication is made by the parties, it is called Voluntary
Adjudication.

 When reference is made to adjudication by the government

without the consent of either or both the parties to the dispute,
it is known as Compulsory Adjudication.
 THREE-TIER SYSTEM OF ADJUDICATION

The Industrial Dispute Act 1947, provides for a three tier

system of adjudication:

 Labour Court (State and Central Government)

 Industrial Tribunal (State and Central Government)

 National Tribunals (Only by Central Government)