ANALYZING EMPLOYMENT LEGISLATION OF TRADE UNIONS

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This article is written by Nehal Sharma of MIT World Peace University, an intern under Legal Vidhiya

Abstract:

The Trade Unions Act, 1926, is a pivotal piece of legislation in India that governs the establishment, operation, and regulation of trade unions. Aimed at safeguarding the rights and interests of workers, the Act provides a legal framework for the formation and functioning of trade unions, granting them recognition and protection. This abstract presents a comprehensive overview of the Act’s key provisions, including the definition and registration of trade unions, their membership and funding, as well as the rights and liabilities of trade unions and their members. Additionally, the Act addresses the conduct of trade union meetings, the power of the appropriate government to make regulations and rules, and provisions for the dissolution of permanent trade unions. By analyzing the Trade Unions Act, 1926, this abstract shed light on India’s efforts to promote industrial harmony, collective bargaining, and the welfare of workers through legally recognized trade unions. This article will delve further into the topic giving a proper understanding of the same.

Keywords: Trade Unions, Legislation, India, Establishment, Operation, Regulation, Workers, Rights

Introduction:

Trade unions play a significant role in protecting the rights and interests of workers, promoting collective bargaining, and ensuring fair labor practices. Throughout history, trade unions have been instrumental in improving working conditions, securing better wages, and advocating for workers’ rights. To regulate and manage the activities of trade unions, countries have implemented various employment legislation. In this article, we will analyze the employment legislation related to trade unions, focusing on its historical development, key provisions, and shortcomings. We will also discuss the importance of collective bargaining in labor relations and its position in India’s context.

History of Trade Unionism in India

The concept of trade unionism in India dates back to the late 19th century when the country experienced industrialization and the emergence of modern factories. The early trade unions were formed to address the exploitation of workers and to fight for better working conditions—prominent figures like Sorabji Shapurji Bengali and N.M. Lokhande was crucial in forming early trade unions, such as the Printers’ Union of Calcutta and the Bombay Postal Union.

Over the years, trade unionism gained momentum, establishing various labor associations and unions in different parts of India—the Bombay Mill-Hands Association, founded by N.M. Lokhande, in 1890, was the first labor association in India. Subsequently, other labor unions like the Madras Labor Union and the Ahmedabad Textile Laborer’s Association were formed, further strengthening the labor movement in the country.

The All-India Trade Union Congress (AITUC), founded in 1920, became India’s first trade union federation, aiming to promote workers’ interests and fight for their rights. Mahatma Gandhi’s idea of trusteeship also influenced the trade union movement, emphasizing cooperation between workers and employers for the welfare of all.

Development of Trade Union Law in India

The need for well-framed labor legislation in India was recognized by various internal and external factors, such as the Swaraj movement, the Royal Commission on Labor, and the establishment the International Labor Organization (ILO) to uplift labor conditions worldwide.

The Trade Unions Act of 1926 became the principal legislation for controlling and managing the work of trade unions in India. It provided for the registration and regulation of trade unions, defined the rights and liabilities of registered trade unions, and established dispute resolution mechanisms.

Over time, various other labor laws were enacted, each focusing on specific aspects of workers’ rights and welfare. These include the Factories Act 1948, the Employees’ Provident Funds and Miscellaneous Provisions Act 1952, the Minimum Wages Act 1948, and the Industrial Disputes Act 1947.

Provisions of the Trade Unions Act, 1926

The Trade Unions Act 1926 is India’s primary legislation regulating trade unions. Let us explore some of its key provisions:

Definition Clause (Section 2(h)): The Act defines a trade union as any combination, whether temporary or permanent, formed primarily to regulate relations between workers and employers or between workers or employers themselves. It includes federations of two or more trade unions.

Registration of Trade Unions (Section 4): To be registered, any seven or more trade union members may apply for registration, subject to certain conditions. The registrar must be satisfied that the application complies with the Act’s provisions.

Rights and Liabilities of Registered Trade Unions (Sections 15-28): The Act specifies the rights and privileges of registered trade unions, including the utilization of general funds, the constitution of a separate fund for political purposes, immunity from particular civil suits, and enforceability of agreements.

Penalties and Procedure (Sections 31-33): The Act prescribes penalties for failure to submit returns, supplying false information, and cognizance of offenses. Violations may result in fines or criminal proceedings.

Shortcomings of Trade Unions

While trade unions play a crucial role in protecting workers’ rights, they also have certain shortcomings:

Competing Unions and Divided Workers: Multiple trade unions in the same industry can lead to division among workers, weakening the collective bargaining power and allowing employers to take advantage of the situation.

Financial Constraints: Many trade unions need help with financial constraints, and their members may need help to pay the membership dues, hindering the growth and effectiveness of the blocks.

Limited Reach: Most trade unions in India are relatively small and may need more capacity to effectively negotiate with the government or companies to meet workers’ demands and objectives.

Employer Resistance: Employers may attempt to dissuade union members from joining by offering incentives or bribes to union officials.

Migrant Workers: Migrant workers, who make up a significant portion of the workforce, often lack access to economic facilities and necessities, making them reluctant to join trade unions or oppose the employer.

Collective Bargaining and Trade Disputes

Collective bargaining is a vital aspect of labor relations and industrial democracy. It is a process in which representatives of workers negotiate with employers to determine terms and conditions of employment, such as wages, working hours, benefits, and other employment-related matters. The essential requirements for successful collective bargaining include a favorable political and social climate, recognition of trade unions, a problem-solving attitude, and continuous dialogue between employers and workers.

The purposes of collective bargaining are to provide workers with a platform to voice their grievances, reach amicable solutions, prevent disputes, foster a peaceful relationship between workers and employers, and promote stable labor relations.

In India, collective bargaining remains limited in its application and has been restricted by various labor legislation. Most of the labor laws in India apply to the organized sector, leaving a significant portion of the workforce in the informal sector without adequate protection. In the Growth of India, Ltd. v. Workmen (1960), the Supreme Court ruled that the appellant company was entitled to demand damages and compensation for the loss it suffered due to its illegal strike. The Court held that Section 18 does not grant immunity for unlawful acts committed by trade union members in furtherance of a trade dispute.

Section 19: Enforceability of agreements

Section 19 of the Act states that any agreement between members of a trade union shall not be subject to legal enforcement if the agreement concerns:

The restriction of trade or business;

The forcing of anyone to join a union or take part in any union activities; or

The payment of any fine or penalty to any member of a union.

This section prohibits trade unions from using agreements restricting trade or business and coercing individuals to join unions or participate in union activities. It also prohibits the imposition of fines or penalties on members for any reason.

Section 20: Right to inspect the books of trade union

According to Section 20 of the Act, every member of a trade union is entitled to inspect the books of the trade union during certain specified hours. The trade union must keep the books open for inspection during those hours at the office of the trade union. The members also have the right to obtain copies of the books on payment of a reasonable fee.

Section 21: rights of minors to membership of trade union

Section 21 of the Act provides that anyone who has attained age 15 is eligible for membership in a trade union. However, a person below the age of 15 may be a member of a trade union only if the rules of the trade union admit persons of such age.

Section 21-A: Disqualifications of office-bearers of trade union

Section 21-A lists certain disqualifications for persons to be chosen as, and continue as, office-bearers of a trade union. The following persons are disqualified:

A person who has not attained the age of 18 years;

A person who has been convicted by a court in India of any offense involving moral turpitude and has been sentenced to imprisonment unless a period of five years has elapsed since his release; and

A person who is not a trade union member during his election or nomination.

Section 22: Proportion of office-bearers to be connected with the industry

According to Section 22 of the Act, at least one-half of the total number of office-bearers of a registered trade union should be engaged or employed in an industry with which the trade union is connected. However, where the number of such office-bearers is less than five, at least two should be employed in an industry with which the trade union is connected.

Section 23: Change of name

Section 23 of the Act lays down the procedure for changing the name of a registered trade union. Any registered trade union that wishes to change its name must submit a notice to the registrar indicating the new name and a copy of the resolution on which the change is proposed. Upon receipt of the notice, the registrar will record the new name in the register, and the new name will know the trade union from the recording date.

Section 24: Amalgamation of trade unions

Section 24 of the Act deals with amalgamating two or more registered trade unions. According to this section, when two or more registered trade unions propose to amalgamate, they must submit a notice to the registrar signed by the office-bearers of each trade union indicating the names of the trade unions that are presented to be amalgamated, the proposed name of the amalgamated trade union, and other specified information. Upon receipt of the notice and being satisfied that the provisions of the Act have been complied with, the registrar will register the amalgamation in the manner specified by the Act.

Section 25: Notice of change of name or amalgamation

Section 25 of the Act requires the trade union, after the change of its name or its amalgamation with any other trade union, to send a notice of the change or amalgamation to every person with whom the trade union has entered into a contract. The notice should be sent within one month from the change date or amalgamation.

Section 27: Dissolution

According to Section 27 of the Act, a registered trade union can be dissolved by the consent of three-fourths of the total number of its members or by order of the registrar if the trade union has fewer than seven members or if the registrar believes that the trade union is no longer functioning. Upon dissolution, the property and funds of the trade union will be distributed among its members per the rules of the trade union.

Section 28: returns

Section 28 of the Act requires every registered trade union to submit an annual return to the registrar. The return should contain information and be submitted within a specified period. The registrar can impose a fine for the late return submission.

Regulations

Sections 29 and 30 of the Act deal with the power.

Section 29: Power to make regulations

Under Section 29 of the Act, the appropriate government can regulate various aspects of trade unions. These regulations may include rules regarding the custody and inspection of the funds of trade unions, the maintenance of a list of members, and the submission of copies of regulations to the registrar, among other matters.

Section 30: Publication of regulations

Once regulations are made under Section 29, they must be published in the Official Gazette. This provision ensures that the rules are accessible to the public and all concerned parties.

Section 31: Rules

The appropriate government also has the power to make rules consistent with the Act to carry out its provisions effectively. These rules may pertain to the election of office-bearers, the manner of voting, the way of holding meetings, and other matters relating to the functioning of trade unions.

Section 32: Power to exempt

Section 32 grants the appropriate government the power to exempt any trade union or class of trade unions from any of the provisions of this Act. Such exemptions can be made if the government deems it necessary or expedient in the public interest.

Section 33: Power to amend the Schedule

The Schedule of the Trade Unions Act contains the model rules for the constitution of trade unions. Section 33 empowers the appropriate government to amend this Schedule by notification in the Official Gazette.

Section 34: Dissolution of permanent trade unions

In the case of permanent trade unions (i.e., unions not formed to pursue a temporary objective), Section 34 of the Act states that no trade union shall be dissolved unless a notice in writing is given to the registrar of such intention at least 14 days before the application for dissolution is made. Seven members of the trade union must sign the notice.

Section 35: Certain Acts not to apply to registered trade unions

This section clarifies that specific provisions of the Indian Companies Act of 1913, and the Societies Registration Act of 1860, shall not apply to registered trade unions. Trade unions are governed by the specific provisions of the Trade Unions Act, and these other Acts do not impact their functioning.

Section 36: Protection of action taken in good faith

Section 36 protects the registrar, any officer, or any other person acting under this Act from legal action for anything done in good faith during the discharge of their duties.

This overview of the various sections of the Trade Unions Act 1926 highlights India’s legal framework governing trade unions. The Act seeks to provide recognition and protection to trade unions while laying down rules for their registration, membership, financing, and operations to ensure that their activities remain lawful and serve the interests of workers.

In conclusion, the Trade Unions Act of 1926 in India has played a significant role in recognizing, regulating, and protecting trade unions. Over the decades, the act has provided a strong legal framework for establishing and functioning trade unions, safeguarding the rights and interests of workers across the country.

Conclusion

The act has laid down provisions for registering, operating, and dissolving trade unions, ensuring they adhere to democratic principles and transparency in their functioning. By giving trade unions legal recognition, the government acknowledges their importance in protecting workers’ rights and advancing their welfare. However, despite the Trade Unions Act’s existence, some challenges persist. The changing dynamics of the labor market and the emergence of new forms of employment have raised questions about the act’s relevance in specific contexts. There have been calls for amendments to address these issues and enhance the act’s effectiveness. Overall, the Trade Unions Act of 1926 remains a crucial piece of legislation in India, shaping the collective voice of workers and their ability to negotiate with employers. It continues to serve as a vital aspect of industrial relations and plays a vital role in maintaining industrial harmony in the nation.

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