Industrial Dispute and Individual Dispute

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This Article is written by Vishwajeet Singh, Som Law College Prayagraj, UP, 4th Semester (LL.B), intern under Legal Vidhiya.

Abstract

In any industry, maintenance of industrial peace has been of utmost importance for its constructive growth. As a result, these industries of different advanced countries, strive to maintain their industrial relationships more or less known as employer-worker relationship in a peaceful manner. In India, these relationship stand to be conceived as a partnership in a constructive endeavour, to promote the satisfaction of the economic needs of the community in the best possible manner. Industrial Disputes Act, 1947 (hereinafter referred as “ID Act, 1947”) which the Ministry of Labour and Employment has now changed to Industrial Relations Code, 2020 (hereinafter referred as “IR Code, 2020”) further provides for maintaining these relationships in successfully.

The Industrial Dispute Act was passed in 1947 and the same come into force from 1st April 1947. This Act was enacted for the promotion of good, cordial relations between the employer and workmen, To investigate and settle disputes between employers and employers, employers and workmen, workmen and workmen. Section 2(k) of the said Act defines Industrial Dispute. There are certain conditions, if these conditions are satisfied, an Individual Dispute may be declared as an Industrial Dispute.

Introduction

Industrial Disputes Act, 1947 is the Act that regulates the labour laws as it concerns all the workmen or all the people employed on the Indian mainland. It came into force on 1 April 1947. The capitalists or the employer and the workers always had a difference of opinion and thus, it leads to lots of conflicts among and within both of these groups. So, these issues were brought to the attention of the government and so they decided to pass this Act. This Act was formed with the main objective of bringing peace and harmony to industrial disputes between parties and solving their issues in a peaceful manner.

Industrial Disputes Act, 1947 defines Industrial dispute, as a dispute or difference between workmen and employers 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. It is the difference or disagreement between an employer and employee’s representative i.e. trade union. However, international organizations such as the International Labour Organization (hereinafter referred as “ILO”) have classified industrial disputes or disagreements into Individual disputes and Collective Disputes. The Individual Dispute is the one which involves a single worker or a number of workers as individuals and is collective if involving a number of workers.

Industrial Dispute

An industrial dispute can be viewed as friction or disagreement between two or more parties involved, due to the difference in their perceptions, opinions, mindsets, attitudes and values. In an organization, the parties engage in such disputes can be.

Employer and employee;
Employee and employee or;
Employer and employer.

On a massive level, conflicts can even arise between the government and the public.

Industrial disputes are sometimes observed as a result of poor industrial relations in the organization

Industrial dispute means any dispute of difference between employees and employers or between employers and workmen or between workmen and workmen, which is connected with the employment or non-employment of the terms of employment or the conditions of work of any person (The industrial Disputes Act 1947, Section 2K).

Every human being (say a labour) has certain requirements/needs e.g., economic needs, social needs, security requirements. When these requirements do not get satisfied, there arises a conflict between the worker and the capitalist/employer.

The industrial disputes are of two types i.e., individual disputes and collective disputes. The individual disputes may be disputes such as reinstatement, compensation for wrong termination etc. Disputes relating to wages, bonus, profit sharing hours of work etc. are collective disputes.

Scope and Object

The object of the Industrial Disputes Act is to make provision for the investigation and settlement of industrial disputes. The Act is primarily meant for regulating the relations of employers and workmen, past, present and future. The principal aim of the Act is to encourage collective bargaining and to maintain industrial peace by preventing illegal strikes and lockouts and to provide lay off and retrenchment compensation.

The Act was passed with a view to removing certain shortcomings found in the working of the Trade Disputes Act, 1929. It came into force on the first day of April 1947 [sec. 1(3)].

It extends to the whole of India [Sec.1 (2)]. It extends to all industries whether they are carried on by private owners or by the government. The Act has been amended from time to time. The latest amendment was made in 1984.

Thus, though the main object of the Act is to provide for investigation and settlement of industrial disputes, the amendment Act seeks to ensure speedier resolution of industrial disputes by removing procedural delays. Besides creating an efficient statutory machinery for the settlement of industrial disputes and thereby promoting industrial harmony, the Act also seeks to achieve certain other objects, referred to as ‘certain other purposes’ in the preamble.

The objects are:

Promoting measures for securing and preserving amity and good relations between employer and workmen.
Enquiring into any matter connected with or relevant to an industrial dispute.
Promoting the settlement of industrial disputes.
Adjudication of industrial disputes.
Reference of individual disputes to grievance settlement authorities.
Voluntary reference of disputes to arbitration.
Prevention of illegal strikes and lock-outs.
Compensation for lay-off and retrenchment of workmen.
Provision for the payment of wages from the date of the award till the suit pending before courts of law is decided.
Prevention of unfair labour practices.

These objects of the Act centre round the securing of industrial harmony and social justice.

Classification of Industrial Dispute

Industrial disputes can be classified on the following grounds:

Interest Disputes

These conflicts are also called ‘conflicts of interest’ or ‘economic disputes’. In most cases the disputes arise from the demands or proposals for improvement in wages, benefits, job security or terms or conditions of employment. Such disputes relate to the establishment of new terms and conditions of employment for the general body workers. Interest disputes must be properly negotiated or bargained or compromised through collective bargaining. These disputes should be settled through conciliation as far as possible. Such disputes are solved generally on ‘give and take’ basis.

Grievance or Rights Disputes

These disputes are also known as ‘conflicts of rights’ or ‘legal disputes’. They involve individual workers or a group of workers in the same group. In some countries, such disputes are called ‘individual disputes’. Such disputes arise from the day to day working relations of the workers and management, usually, as a protest by the workers or workers against an act of management that is considered to violate his or their legitimate right.

Grievances typically arise on such questions as discipline, promotion, transfer or dismissal of a worker, payment of wages, fringe benefits, overtime, retirement benefits, seniority work-rules, leave rules etc., which are against the practice and affect their rights adversely. In some cases, disputes arise especially over the interpretation and application of collective agreements.

Recognition Disputes

Recognition Disputes arises when the management of an organization refuses to recognize a trade union for the purpose of collective bargaining or to represent its member employees in case of a conflict or dispute. Issues under this category differ according to the cause that led the management to refuse recognition. Here the problem is that of attitude. A Trade union victimization happens when there is already an existing trade union or it is a case of multiple trade unions and each making a claim for recognition. Recognition Disputes also arises when a particular trade union does not have sufficient representatives. Recognition disputes are settled through the guidelines given by the government for recognition of trade union or with the help of Code of Discipline which has been voluntarily laid down by the government.

Disputes over Unfair Labour Practices

Such disputes arise over the malpractices adopted by the management against a worker or trade union. The examples of such malpractices may be discrimination against workers for their being members of the trade union or their involvement in union activities; interference, restraint or coercion of employees from exercising their right to organise, join or assist a union; establishment of employer sponsored union and coerce the workers to join such union; refusal to bargain with the recognized union; recruiting new employees during a strike which is not declared illegal; failure to implement an award, settlement or agreement; indulging in acts of violence. These practices are also known as ‘trade union victimization’. In some countries a procedure is given to settle such disputes. In the absence of any such procedure, the disputes are settled in accordance with the provisions of the Act relating to industrial disputes.

Case Law:

In W.S. Insulators of India Ltd. v. Industrial Tribunal, Madras, (1977) IILLJ 225 Mad case, the Court held that unless there is a demand by the workmen and that demand is not complied with by the management, there cannot be any industrial dispute within the meaning of Section 2(k). Mere participation by the employer in the conciliation proceedings will not be sufficient.

Individual Dispute

Where any employer discharges, dismisses, retrenches or otherwise terminates the services of an individual workman, any dispute or difference between that workman and his employer connected with, or arising out of, such discharge, dismissal, retrenchment or termination shall be deemed to be an industrial dispute notwithstanding that no other workman nor any union of workmen is a party to the dispute

Any aggrieved workmen can raise the dispute before the consultation officer.

Before the Industrial Dispute (Amendment) Act, 1965, a dispute concerning only an individual workman is not considered an industrial dispute. The courts also excluded them from the definition of industrial dispute.

There were three different opinions prevalent at that time in regard to the individual dispute:

The individual dispute (i.e., the dispute between an employer and a single workman) cannot be an industrial dispute,
The individual dispute can be an industrial dispute,
Individual disputes cannot be per se called industrial disputes but may become one if it is represented by a trade union or group of workmen.

Case Law :

The Newspapers Ltd v. the State Industrial Tribunal, U.P. (1957)

This controversy was set to rest by the Supreme Court as it held that the dispute between an employer and a single workman does not fall under the definition of industrial dispute. But if that single workman shares the common cause with the body of workmen or a considerable section of them, the individual dispute can also be considered an industrial dispute.

This position of the court has been overturned in the case of Workmen of M/S Dharampal Premchand (1966), where it was held that an individual dispute could not be regarded as an industrial dispute unless espoused by his own trade union or a substantial number of workmen. It means the workmen who were not supported by any trade union will not get any remedy for the dispute. This case caused hardships for various workmen who failed to get represented by trade unions.

To end this controversy and mitigate this issue, Section 2A was added through the Industrial Dispute (Amendment) Act, 1965. According to this Section, individual disputes related to ‘dismissal, discharge, retrenchment or termination’ of the workman will now be called industrial disputes. It is no more necessary for an individual dispute to be taken up by any trade union or a considerable number of workmen. The objective behind this amendment is that the workman should not be left at the mercy of trade unions to get justice on certain matters.

When an Individual Dispute becomes an Industrial Dispute?

Before insertion of Section 2-A of the Act an individual dispute could not per se be an industrial dispute, but it could become one if taken up by the Trade Union or a number of workmen. The Supreme Court and majority of Industrial Tribunals held that, a dispute raised by a dismissed employee would not be treated as an industrial dispute, unless it is supported by a trade union or by a body or the section of workman.

For an individual dispute to be declared as an Industrial Dispute, the following conditions are to be satisfied:

A body of workmen (trade union ) or a considerable number of workmen, are found to have made common cause with the individual workman;
That the dispute (individual dispute) was taken up or sponsored by the workmen as a body (trade union) or by a considerable Section of them before the date of reference.

Bombay Union of Journalists vs. The Hindu: A person working in ‘The Hindu, Madras’ was terminated for claiming as a full time employee. The Bombay Union of Journalist raised the dispute. It was found that, there were ten employees, of which seven in administrative side and only three in journalism side. Of these three, only two were the members of the union. Therefore, the Supreme Court held that the Bombay Union of Journalists is not competent to raise this dispute. Even if it had raised, it could not have become an industrial dispute.

Workmen of Indian Express Newspapers Ltd. vs. Management Indian Express Newspapers: A dispute relating to two workmen of the Indian Express Newspapers Ltd was espoused by the Delhi Union of Journalists which was an outside union. About 25 percent of the working journalists of the Indian Express were members of that union. But there was no union of the journalists of the Indian Express. It was held that the Delhi Union of Journalists could be said to have a representative character. The working journalists employed Indian Express and the dispute was thus transformed into an industrial dispute.

Section 2-A provides that “where any employer discharges, dismisses, retrenches or otherwise terminated the services of any individual workman, any dispute or difference between that workman and his employer connected with, or arising out of such discharge, dismissal, retrenchment or termination shall be deemed to be an industrial dispute, notwithstanding that no other workman nor any union of workmen, is a party to the dispute.”

Any workman may make an application directly to the labour court or Industrial Tribunal for adjudication of such dispute after the expiry of 3 months when an application was made before the conciliation officer. This has been done to prevent inordinate delay.
The said application however should be made within 3 years of the date of dismissal, discharge, retrenchment or termination of service.
The court shall proceed to hear the matter as if it was referred to it U/S 10 of the ID Act.

Section 2A does not declare all individual disputes to be industrial disputes. It is only when a dispute is connected with a discharged, dismissed retrenched or terminated workman that it shall be treated as an industrial dispute. If the dispute or difference is connected with some other matter e.g. payment of bonus/ gratuity etc. then it would have to satisfy the test laid down in judicial decisions. Thus only a collective dispute could constitute an industrial dispute but collective dispute does not mean that the dispute should either be sponsored by a recognized union or that all or majority of the workmen of an industrial establishment should be parties to it. (State of Bihar vs. kripa Shankar Jaiswal)^[[1]]

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 on unconnected with the employer or the industry concerned. (Express Newspapers (Private) Ltd. Vs. First Labour Court, West Bengal & Others)^[[2]]

Where an individual dispute is espoused by union the question of the employee being a member of the union when the cause arose is immaterial. Those taking up the cause of the aggrieved workman must be in the same employment i.e., there must be community of interest when the act complained against happened and not when the dispute was referred to.

Difference between the industrial dispute from the individual dispute

The industrial dispute conveys the meaning that the dispute must be such as would affect large groups of workmen and employers ranged in opposite sides. Where as, the individual dispute is the one which is raised by a single worker. It is not mandatory that a dispute should be raised by a registered Trade Union to constitute an industrial dispute. When community interest gets added to the individual dispute or it is supported by workmen themselves or their union or federation on their behalf an individual dispute transforms into a collective industrial dispute.

According to the definition under ID Act, 1947 the dispute can be raised either for a workman or any person about whom the workmen have a substantial interest in the employment or non-employment or terms of employment or conditions of labour. Here, the expression “any person” connotes to workmen and any other person provided it is related with the workmen about whose employment or non-employment or terms of employment or conditions of labour workmen have a direct and substantial interest. Alternatively, it can be said that any person must be an employee of the industry in which the workmen are employees (Narendra Kumar Sen v. All India Bank Dispute, AIR1953 Bom 325).

Similarly, in Workmen of Dirakuchi Tea Estate v. Management of Dirakuchi Tea Estate, 1958 AIR 353, the expression “any person” was interpreted in the definition clause as meaning a person in whose employment or non-employment or terms of employment or conditions of labour. The workmen as a class have a direct or substantial interest with whom they have under the scheme of the Act a community of interest. The Court further said that only the aggrieved party can raise a dispute but, in case if an industrial dispute it is put in a collective basis because it settled that an industrial dispute not espoused by others of the class to which the aggrieved party belongs is not an industrial dispute.

Thus, from the above decision, it can be said that “any person” one about whom the workmen have a substantial interest in the employment or non-employment or terms of employment or conditions of labour even though he does not fall within the definition of “workmen” under the ID Act, 1947.

Resolution of the individual disputes

Industrial progress and prosperity, maintenance of peaceful relations are important for the successful administration of industry. The individual disputes are raised can be resolved through Grievance Settlement Authority in accordance with rules under ID Act, 1947, or through registered trade unions under Trade Unions Act, 1926, or through the Labour Court having competent jurisdiction.

Conclusion

Good management-employee relation is necessary to keep industrial peace and harmony alive, which is necessary for any country’s economic growth and development. Good industrial relation depends upon mutual understanding between the management and the workers. When this understanding between them disrupts, it leads to several types of industrial disputes, such as disputes on rights, disputes on interests, disputes related to unfair labour practices or recognition disputes. Each dispute has solutions to it. There are many dispute resolution machinery functioning in the country that provides expedient and amicable settlement of disputes. But it must be understood that disputes will always lead to conflicts and disruption in industrial peace, so it is important to resolve these disputes as early as possible by employing any of the methods provided by the amicable settlement of disputes.

References