Labour NOC
Labour NOC
Right to strike is not an FR or LR, or any right for that matter for a government servant. They are
bound and regulated by their respective service rules.
PUDR v. UOI:
If minimum wage is not paid then the work will be considered Begar.
In this case CB was recognized as being part of human dignity. Right to bargain collectively with
an employer enhances human dignity.
How do we select a bargaining agent, for the purpose of representing the interest of the
stakeholder in a CBA. Court in this case suggested a system of a secret ballot.
TU was recognized for a period and was then de-recognized. HC was approached. HC said that
de-recognition was valid as no right to recognition exists.
HC held that even if right to recognize TU is not a statutory right, in order to recognize rights of
workers, TUs are to be recognized.
Acc to s.18 a CBA shall be binding on the parties and not to minority trade union, since they are
not parties. 18 is very clear on bindingness.
CBA binding even on the dissenting members of the TU, since they have subscribed to the
constitution of the TU
SC recognizes the right to strike during collective bargaining process for better bargaining.
Primary object of a trade union and when demands like these are put forward and thereafter a
strike is resorted to in an attempt to induce the Company to agree to the demands or at least to
open negotiations the strike must prima facie be considered justified.
Once entered into a CBA cannot be challenged, except on the allegations of fraud, in which case
the onus will be on the one who alleges it.
Person who ceases to be a workman will not be entitled to benefits of the CBA.
The right guaranteed by Art. 19(1)(c) of the Constitution does not carry with it a concomitant
right that unions formed for protecting the interests of labour shall achieve their object such that
any interference to such achievement by any law would be unconstitutional unless it could be
justified, under Art. 19(4) as being in the' interests of Public order or morality. The right under
Art. 19(1)(c) extends only to the formation of an association or union and insofar as the
activities of the association or union are concerned or as regards the steps which the union
might take to achieve, its object, they are subject to such laws as, may be framed and such
laws cannot be tested under Art. 19(4).
DM Bannerjee v. RP Mukherjee: 5J
This is the first case where the aspect of Industry was interpreted. They relied on the case of
Australian HC in the case of Federal Municiple and Shire Council Employees Union v.
Melbourne Corporation, where an Industry was defined as any corporation between labour
and Capital.
In this case 2 workers, Head Clerk and one inspector were removed from the service.
Association challenged that it is done on ground of victimization. Matter referred to IT. Two
issues existed in the matter, whether there exists an industrial dispute, and whether the reference
in the present case was valid. Court more concerned with the aspect of municipality being an
Industry. SC after analyzing 2j,k and 2s, gave way to triple test for the first time. Held that
municipality will be covered under the aspect of industry.
Held that industry is an cooperation between the employer and the employee. This was
beginning of interpretation, but the case did not specify and differentiate between the activities
as performed, some of the corporation’s action being covered under sovereign authority.
No room for doubt that this Court construed the terms of the definition of "industry" in a way
which takes in activities which are not strictly called trade or business. Therefore, the words "not
strictly be called a trade or business venture" and the words "analogous to the carrying out of a
trade or business" emphasize more the nature of the organized activity implicit in a trade or
business than to equate the other activities with trade or business. This is made more clear by the
learned Judge when he expressly reserves the Court's opinion on a wider question in the
following words: "it is unnecessary to decide whether disputes arising in relation to purely
administrative work fall within their ambit."
Dominant nature test was discussed in this case. Under this test nature of the predominant
function carried on by the establishment will be considered. In the present case there existed
many departments. Some of the function will not be covered under sovereign function. Under
this test functional aspect of an industry is to be considered. This was also accepted by Iyer J. in
Bangalore water supply case.
Assessment of tax and prevention of adulteration are sovereign function and IDA will not be
applicable with respect to the same. However educational institution under the municipality will
be covered under the definition of an Industry.
Personal service or domestic service will not be covered under the meaning of Industry.
2 workers were terminated and in their place retired employees of the state government were
engaged. It was held that Hospital is an Industry, even if they are not engaged in profit
making, but they provide service. Ganjendragadkar J., laid down aspects of Triple test,
which were later accepted by Iyer in Bangalore water supply case.
It said that Hospitals are not covered under the ambit of an Industry. Hospital provides service
but cannot be termed an Industry, this case over ruled Hospital Majdoor sabha case.
Issue whether educational institutions are Industry or not? In the present case drivers were
removed from the service of Miranda House College. Held that educational institutions cannot be
covered under the aspect of Industry. Dominant nature test not accepted here.
SC held that teachers are not workers but are part of the noble profession. It said that as per the
predominant nature test of the function of imparting of education, Du will not be covered under
the aspect of industry, this was also overruled in the case of Bangalore water supply.
This case overruled all the cases, except; Bannerjee, Nagpur, and state of Bombay cases. We
over-rule Safdarjung, Solicitors' case, Gymkhana, Delhi University, Dhanrajgirji Hospital and
other rulings whose ratio runs counter to the principles enunciated above, and Hospital Mazdoor
Sabha is hereby rehabilitated.
Court concluded 2 tests to examine whether an organization is an industry or not.
Triple test:
The aspect of sovereign and non-sovereign was also recognized in the present case. Also held,
that the duration of employment shall not be relevant.
Some activities taken, dominant condition of these activities will be considered to evaluate
whether we have an Industry or not. Where there are complex activities, some of which qualify
for exemption and others do not, you look into those which do not qualify for the exemption.
Decision on predominant nature of goods and services would determine whether an organization
is an industry or not. Sovereign function exempted from the ambit of Industry. Where a
complex of activities, some of which qualify for exemption, others not, involves employees
on the total undertaking, some of whom are not 'workmen' as in the University of Delhi
Case or some departments are not productive of goods and services if isolated, even then,
the predominant nature of the services and the integrated nature of the departments as
explained in the Corporation of Nagpur, will be true test. The whole undertaking will be
'industry' although those who are not 'workmen' by definition may not benefit by the
status.
This understanding of sovereign itself has gone through a change in the recent times. In a
department that is discharging a sovereign, if units are severable then can be covered under IDA.
In view of the difficulty experienced by all of us in defining the true denotation of the term
"industry" and divergence of opinion in regard thereto-as has been the case with this bench also-
we think, it is high time that the Legislature steps in with a comprehensive bill to clear up the fog
and remove the doubts and set at rest once for all the controversy which crops up from time to
time in relation to the meaning of the aforesaid term rendering it necessary for larger benches of
this Court to be constituted which are driven to the necessity of evolving a working formula to
cover particular cases.
Here it was recommended that Bangalore case be reviewed by a higher bench. Said that there is
some problem with the triple test.
This case was appreciated by Bangalore water supply case. Held that Industry shall exclude legal
and medical profession, since not carried on in any intelligible sense by the corporation of capital
and labor. Not within the sphere of industrialization.
Solicitor firm not included within the ambit of industry. This understanding altered after
Bangalore water supply case and now if triple test satisfied they can be covered.
Held, that clubs not included within the ambit of an industry, since it is looked after by members
themselves. These also overruled in the Bangalore water supply case.
Isaac J. he recognized the fact that states are capable enough and do act like commercial powers.
Same was followed in Bangalore water supply.
Held that Central water board will not be an industry. SC failed to examine triple test.
SC did not discuss Nagpur of Bangalore case, thus the order is per incuriam.
Lab is not an Industry since services not produced for general public.
Short v. JW Andreson:
Control test
Masters’ power to appoint servant
Employer to appoint employee
Masters liability to pay for services rendered
Master has supervision
Employer has power to dispense with the service.
He also agrees expressly or impliedly that in performance he would be subject to other controls
in a sufficient degree to make the other his master.
Other provision of contract of service are consistent with its being constant service.
Appellants engaged in manufacture of sea salt from sea water. Land divided into pattas, for
manufacture. Plots allotted to villages and paid 400. Villages were at liberty to engage anyone.
Supervisor was appointed by the company and payment was made based on the amount of salt
produced. Differences arose between the workers and the company.
Issue was whether agarias were workers or not. Company contended that they were independent
contractors, not supervised and there were no specific hours of work.
SC relied on HOL cases and the control test. Gave out two components:
Stevenson v. Donald:
Discussion on Integration or Organizational Test. If the person is employed as part of the
business and the work that he performs is essential to the business or an integral part of the same
then the person shall be covered under the aspect of contract of service.
Under contract for service, his work though for business is not integral to it but is only assisting.
Control is not to be taken as sole test in determining the relation of employee and employer, all
relevant facts and circumstances are to be considered., including terms and conditions of
contract. Important to take multiple pragmatic approach, weighing all factors for and against an
employment, instead of going by sole test of control.
Integration test in one of the relevant test, applied by examining whether the person was fully
integrated from employer’s consent or remained independent part thereof.
Appellant engaged in tailoring activity and had employed 25 workers. These workers were paid
as per the pieces that they produced (piece and time rate workers). Initially they formed
association and demanded enhancement of tailoring charge, which was not accepted. Strike was
declared and subsequently all the workers were removed.
IT had held that they were independent contractors. Then, SC held that there existed an Industry,
Honorarium was paid and work was performed, thus they were held to be workers.
In the present case a contractor was engaged for the purpose of Bidi making. Supply of raw
materials was done by the contractor but was supervised by the principle employer at home.
Contract worker by the appellate company to perform perennial jobs like maintenance and
cleaning. Similar job performed by regular workers in some other similar industries. Labor raised
dispute that you discontinue the contract and employ us on permanent basis. IT directed the
employer to discontinue this practice of contract labor. SC recognized the decision of the IT.
SC held that clear case of ID. Also held that in these matters community interest should exist.
Here labour was employed for cleaning and maintenance through contractor, the regular
employees raised a dispute for regularization of the contract labor. The regular workmen have
direct and substantial interest in the contract workers.
A single test like presence or absence of control was often relied on to determine whether the
case was one of the master and servant. Mostly in order to decide issues of tortuous liability, on
part of the mater or superior and that in the more complex condition of modern industry. More
complicated test to be applied.
A person cannot be both workman and apprentice. If someone engaged under contract of
apprenticeship then he cannot be called a worker. If contract is authentic then the person will act
as an apprentice only. However if the same is found to be not authentic then he may be treated as
a worker.
The benefits to an apprentice are provided for under S. 14 and 16 of the 1961 Apprenticeship Act
and so no need to include them under IDA. Labor code on 2015 aims at removing the term from
2j.
Appellant engages respondent as a casual worker on a daily basis. Duration for wage period not
to be more than 30 days. After 3 years, appointed apprentice trainee (shop assistant). Then
transferred to regional office where he was involved in mail dispatch. He was finally terminated.
No explanation given.
State government referred the matter to LC. LC concluded that he was a workman. HC approved
LC order, camouflage agreement. If a person understood to be a workman, then is to be covered
under 2(oobb). SC concluded that he was an apprentice. 2s is logical and an apprentice cannot be
both worker and apprentice.
Appellant engaged as area sales executive, his services were terminated. Government failed to
make a reference on the ground that he was not a worker. DHC upheld the decision of the
government.
Under S.10 appropriate government performs an administrative action with civil consequences
and not a Q-judicial action. So it cannot adjudicate. Rejection of reference is a kind of
adjudication which is not permitted.
SC held that though 10 is a discretionary power but the government cannot delve into merits of
the case and adjudicate. Appropriate forum to decide on the status of the individual and the
merit of a case is the LC.
ID comes into existence when employer and worker are at variance and dispute is connected
with; employment, non-employment, terms of employment, conditions of employment.
The expression T&C would ordinarily include not only the contractual terms and conditions but
also those terms and conditions which are understood and applied by parties habitually or by
common consent, without even been incorporated in the contract.
Once a special body created then the jurisdiction of civil court is impliedly barred. Also in
Rajasthan Road ways v. Krishnakant.
Dr. Banerjee appointed by estate as professor for 3 months on probation. He was removed after
three months and one month salary was paid to him. This is a case of retrenchment.
Dispute was sponsored by Assam State TU of Dibrugarh. They found that Dr. was removed on
ground of incompetency.
Before tribunal estate contended that, Dr. is not a workman, so no jurisdiction exists. This
contention was accepted, tribunal not taking of the aspect of ‘any person’. Appellate tribunal
approved the decision.
Before SC, Das (maj.), said that employee shall mean workman only. Any person mean a person
in whose employment workmen or his association have direct interest.
Sarkar J. (min.), he says, any person under 2k and 33A, is to be read in addition to the parties.
Liberal interpretation by him.
Ratio: banerjee not a workman, belonged to medical and technical staff TU had no direct and
substantial interest in his employment. Cannot be said on the basis of the test laid down that
dispute regarding termination/retrenchment was ID.
Banerjee supported worker so that worker had a direct and substantial community interst.
Gajendra J, ‘any person’ not confined to strict parameters. Workers who have raised ID must
have substantial community interest to the employment.
Para 20 and 21
The word 'person' has not been limited to 'workman' as such and must, therefore, receive a more
general meaning. But it does not mean any person unconnected with the disputants in relation to
whom the dispute is not of the kind described. It could not have been intended that though the
dispute does not concern them in the least, workmen are entitled to fight it out on behalf of
non-workmen.
It may, however, be said that if the dispute is regarding employment, non-employment, terms
of employment or conditions of labour of non-workmen in which workmen are themselves
vitally interested, the workmen may be able to raise an industrial dispute. Workmen can, for
example, raise a dispute that a class of employees not within the definition of workman
should be recruited by promotion from workmen. When they do so the workmen raise a
dispute about the terms of their own employment though incidentally the terms of
employment of those who are not workmen is involved. But workmen cannot take up a
dispute in respect of a class of employees who are not workmen and in whose terms of
employment those workmen have no direct interest of their own.
Similar factual and matrix as the hypothetical MCD example. SC denied relying on Dimakochi.
Non workmen as well as workmen can raise dispute in respect of employment or non
employment where there is community interest that is direct and not remote.
Bhavnagar MC vs. Ashok bhai rawat
TU for any person. If TU not supporting then the condition may not be satisfied and thus no
remedy under IDA.
Can employer claim compensation from workers before the labor court? This is beyond the
scope of IDA since no power is given to the labor court to award damages. Wrongful loss to be
decided only by a civil court. Paying damage is neither a condition nor a term of the work.
Dispute must be supported by a TU. This can be a minority or a majority TU can be registered or
unregistered or recognized or un recognized. If no TU then support of substantial employee of
dept. if no substantial no. then of other dept. in the same industry.
Civil court has no jurisdiction when it comes to industrial dispute. If disputes sponsored then
approach labor court.
WC is purely a consultatiuve body whose suggestions are not binding but only recommendatory
on workmen or employer.
Para 6
Section 12 says report be submitted within a fortnight, if it is not completed but carried on.
Proceedings do not automatically come to an end but culminate only as per S.12 (6).
Para 5
Even though a CO is not competent to adjudicate upon dispute he is expected to assist them to
arrive at a just settlement. He should play the role of a friend of both the parties. Should see that
neither parties take undue advantage of the situation.
Person appointed as area sales executive, his sevices were terminated he approached appropriste
govt. appropriate govt. rejected the reference on the ground that the person is not a workman.
Co. had employed 900 drivers through contracter. They raised demand of regularization and
benefits at par with regular employees. Dispute not reffered on the ground that the individuals
were not workmen.
Para 12 & 10
SC said it is well settled that while exercising power under S. 10 the function of appropriste govt.
is administrative and not q. judicial. In performing administrative function cannot dwell into the
merits of the disputes and take upon itself the determination of lis, which would certainly be in
excess of power conferred by the act.
Appropriate govt. refused to make reference since teacher is not a workman (cause of ramnath
case). Govt. can take shelter under SC’s decision.
Appropriate govt. is not justified in making a decision under S.10 without evaluating facts
brought to its notice. Order of appropriate govt. making reference is an administrative order and
not a Q. judicial order therefore it cannot canvas the order of reference closely to see if there was
any material before the govt. to support its conclusion, as if it was a judicial or Q.judicial order.
HAL HQ in Bangalore but the branch is all over the country. Dispute relating to barakhpur
branch in WB. Dispute was referred by WB to the labor court. This challenged since HAL was
funded by central govt. SC said that specific branch located at barakhpur was independent and
thus SC considers this as existence of cause of action.
SC said that barakhpur establishment was controlled by the HQ but was an independent
institution. Thus state of WB was the appropriate govt. to make reference.
Registered office was in ahemdabad and branch in Bombay. Workmen in Bombay got
terminated. Approached Bombay labor court under BIRA. This opposed by the company as the
registered office was at ahemdabad.
BHC held the ID act does not deal with the cause of action nor does it indicate what factors will
conferred jurisdiction upon the labor court but applying the well known test of jurisdiction courts
and tribunals will have jurisdictions if parties reside within its jurisdiction or the subject matter
of dispute substantially arises in its jurisdiction.
This reasoning was followed in Indian cable commity vs. workmen and workers of rangdavila vs.
rangdavila motors.
Judgement of BHC created problems. How can state govts. Be appropriate authority for a central
govt. establishment. Also this case related to BIRA and SC following it even for IDA.
Workmen in sonipat removed from service reference was made to Chandigarh labor court and
not State of Haryana. SC generally takes into consideration the matters of convenience. But here
SC did not take cognigance of earlier decisions.
Reference made by central government to tribunal located in Karkaduma since HQ was in Delhi.
Court did not dwell into technicality but necessity which was more important.
SC held that reference can be corrected by the appropriate govt. and not by the labor court.
No provision under section 10 or in the Act to withdraw the reference. Govt. has no power either
expressed or implied to cancel or withdraw reference after it has made the order. If this is done
then the same will be liable to struck down as ultra vires.
IT was created for the case for one year but the case was not concluded within that period.
Second notification for another IT was then issued.
SC held that the second reference was illegal. Conclusion of case is necessary and so the first IT
should have been extended.
Forums functions and duties are like that of bodies discharging judicial functions although it is
not a court. Power in this respect are wider than in civil court.
Tribunals have to discharge q. judicial function, power for the same is derived from the statute.
They have to function within the limits imposed by the statute.
PIL filed against the decision of the DJ, who on direction from DHC had transferred cases from
one labour court to another. Action challenged that DJ had no power to transfer this can be done
only by the appropriate govt.
HC relied on the case of state of Maharashtra vs. lab ass. In which employment of assistant
labour commissioner was set aside.
In the present case govt. of delhi created additional labor courts and disputes were transferred to
new courts. Preciding officers were appointed and selected; notification was issued by NCT that
all posts would be treated as cadre posts.
DHC held that transfer by DJ was under the direction of DHC under article 227. This power can
be exercised by HC under delegation.
Labor court performs judicial functions so we need judicial officers to perform these functions
(Namit Sharma vs. UOI and CIC).
It is clear that tribunal while answering reference has to confine its enquiry to the question
referred and has no jurisdiction to travel beyond the terms of reference while answering the
reference. No enquiry on those questions which are not refereed.
Services were terminated. Reference to labor court thane. Ex-parte award in favour of appalette.
On 29-1-1999 respondent submitted application for setting aside of award saying that he was not
served with notice. Award revoked and date for fresh hearing given. Writ before BHC dismissed.
SC relied on the case of Anil sood, where court had relied on 22 and did not discuss 10B clause 9
while tripathi was based on rule 26. SC held that no conflict between 17A and rule 26.
Ex-parte passed on 10-9-1995 and application for recall on 6-11-1995. The same was accepted.
Rule 10B(9) read with S. 17(A) was not discussed.
Here drivers were engaged by the officers of the bank. They wanted to claim privileges of
employees of the bank. Dispute represented by president of TU. He wanted adjournment but was
not given and EX-parte award was passed. Application for recall passed in time.
SC said a tribunal has power to set aside the award before expiry of thirty days. No power after
the expiry of thirty days as court becomes functus officio after that.
Two kinds of review, one on merits and another on procedure. No power of review on merits is
available to labor court, since no express provision empowering it on the same.
A temporary teacher was employed. He was removed from service. Council for the trust filed
application to represent the trust the same was opposed by the other party and thus was rejected.
SC held that 36(4) of IDA will override S.30 and 14. IDA is a special piece of legistlation with
the aim of labor welfare. This special Act would prevail over the advocate Act of 1961 and Bar
Council of India Act of 1926, which is a general piece of legislation. A lawyer can appear before
truibunal in the capacity of a office bearer of TU.
SC in its interim order held that 36(4) is un constitutional and that article 14 and 19(1)(G). this
case did not discuss paradeep porter’s case. Reason was that industrial law has become so
complex that a layman cannot present his case. in para 4 court permitted addition of new grounds
in respect of section 13 of family courts act.
LK Verma v. HMT:
It is open to LT/IT to interfere with punishment for good and valid reasons where workman is
guilty of misconduct.