MODULE 4

STATE PRESCRIPTION
OF STANDARDS

VIRANGNA DHILLON
LAY OFF
Section 2(kkk), Chapters VA and VB
DEFINITION
Section 2(kkk) of the IDA defines "lay-off" as the failure, refusal, or
inability of an employer on account of shortage of coal, power,
raw materials, accumulation of stocks, breakdown of
machinery, natural calamity, or for any other connected reason,
to give employment to a workman whose name is on the muster
rolls of his industrial establishment and who has not been
retrenched.

This definition provides a comprehensive understanding that lay-off

is considered a temporary measure, not an indication of the
worker's termination or retrenchment from employment.
LAYOFF
THE ESSENTIALS OF LAY OFF ARE AS FOLLOWS-
There must be failure, refusal or inability on the part of the
employer to give employment to a workman.
The failure, refusal or inability should be on account of a
shortage of coal, power or raw materials or accumulation of
stocks or breakdown of machinery, or natural calamity, or
any other connected reason.
The workman’s name should be on the muster rolls of the
industrial establishment.
The workman should not have been retrenched.
According to Section 25 C of the Industrial Disputes Act, a
workman who is laid-off is entitled to compensation equivalent to
50 percent of the total basic wages and dearness allowance for
the period of lay-off.

This right of compensation is, however, subject to the following

conditions:

(i) He is not a badli or a casual workman.

(ii) His name should be borne on the muster rolls of the

establishment.

(iii) He should have completed not less than one year of

continuous service under the employer.
Provided that if during any period of twelve months, a workman
is so laid-off for more than forty-five days, no such
compensation shall be payable in respect of any period of the
lay-off after the expiry of the first forty-five days, if there is
an agreement to that effect between the workman and the
employer:

Provided further that it shall be lawful for the employer in any

case falling within the foregoing proviso to retrench the
workman in accordance with the provisions contained in
section 25F at any time after the expiry of the first forty-five
days of the lay-off and when he does so, any compensation
paid to the workman for having been laid-off during the
preceding twelve months may be set off against the
compensation payable for retrenchment.
Workmen of Dewan Tea
Estate v Their Management
AIR 1964 SC 1458
FACTS
Dispute between the workmen of 11 Tea Estates and their
management over a 45-day lay-off declared by the management in
February 1959 due to financial difficulties.

The workmen argued that the lay-off was unjustified and claimed
full wages for the period, whereas the management contended
that the lay-off was necessary due to a trade depression and
financial hardship, entitling the workers only to statutory
compensation under Section 25C of the Industrial Disputes Act,
1947.

Declaration of lay off for such a long period as 45 days exposed

them to the risk of semi-starvation. The appellants also urged that
depression in trade or financial difficulties which may be
characterised as trade reasons did not justify the lay off.
ISSUE
WHETHER IT CAN BE SAID THAT SECTION 25C
RECOGNISES A COMMON LAW RIGHT OF THE
INDUSTRIAL EMPLOYER TO LAY OFF HIS
WORKMEN.
JUDICIAL HISTORY
The Tribunal has held that the relevant Standing Order No. 8
justified the lay off. Even if it was not justified by the Standing
Order, there is a common law right to declare a lay off by s. 25C
of the Act.

In the Tribunal’s opinion, there was justification for lay off in their
cases, but its duration should have been 21 days. Acting on this
finding, the Tribunal has ordered that for the 24 days in excess of
three weeks for which the lay off was justified the said companies
should pay their workmen full wages and not merely the
compensation prescribed by s. 25C of the Act. In regard to the
remaining four companies, the Tribunal held that the lay off was
fully justified, and so, the workmen were not entitled to full wages
for the period of the lay off.
ANALYSIS
The question which we are concerned with at this stage is whether
it can be said that s. 25C recognises a common law right of the
industrial employer to lay off his workmen. This question must, in
our opinion, be answered in the negative.

When the laying off of the workmen is referred to in s. 25C, it is

the laying off as defined by s. 2(kkk), and so, workmen who can
claim the benefit of s. 25C must be workmen who are laid off
and laid off for reasons contemplated by s. 2(kkk); that is all
that s. 25C means.

If any case is not covered by the Standing Orders, it will necessarily

be governed by the provisions of the Act, and lay off would be
permissible only where one or the other of the factors mentioned by
s. 2(kkk) is present, and for such lay off compensation would be
awarded under s. 25C.
HELD
Therefore, we do not think that the Tribunal was right in
holding that s. 25C recognises the inherent right of the
employer to declare lay off for reasons which he may regard as
sufficient or satisfactory in that behalf.

No such common law right can be spelt out from the provisions of s.
25C.
Workmen of Firestone Tyre
and Rubber Co. v. The
Firestone Tyre and Rubber
Co. (1976) I LLJ 493 (SC)
FACTS
It manufactures tyres at its Bombay factory and sells the tyres and
other accessories in the markets throughout the country. The
company has a Distribution office at Nicholson Road, Delhi.

There was 2 strikes in the Bombay factory. As a result of the strike

there was a short supply of tyres etc. to the Distribution office.

In the Delhi office, there were 30 employees at the relevant time. 17

workmen out of 30 were laid-off by the management as per their
notice dated the 3rd February, 1968.

The lay-off of the 17 workmen was recalled by the management on

the 22nd April, 1968. The workmen were not given their wages or
compensation for the period of lay-off.
ISSUE
WHETHER THE ACTION OF THE MANAGEMENT
TO 'LAY-OFF' 17 WORKMEN IS ILLEGAL AND/OR
UNJUSTIFIED,

AND IF SO, TO WHAT RELIEF ARE THESE

WORKMEN ENTITLED?
Chapter VA was introduced in the Act to provide for lay-off and
retrenchment compensation. Section 25A excluded the Industrial
Establishments in which less than 50 workmen on an average
per working day had been employed in the preceding calendar
month from the application of Sections 25C to 25E.

Section 25-C provides for the right of laid-off workmen for

compensation and broadly speaking compensation allowable is
50% of the total of the basic wages and dearness allowance that
would have been payable to the workman had he not been laid-off.

It would be noticed that the sections dealing with the matters of

lay-off in Chapter VA are not applicable to certain types of
Industrial Establishments. The respondent is one such
Establishment because it employed only 30 workmen at its Delhi
office at the relevant time. In such a situation the question beset
with difficulty of solution is whether the laid-off workmen were
entitled to any compensation, if so, what'?
ANALYSIS
In this case, there being no Standing orders certified and there
being no contract of service conferring any such right of lay-off,
the inescapable conclusion is that the workmen were laid-off
without any authority of law or the power in the management
under the contract of service.

If the terms of a contract of service or the statutory terms engrafted

in the Standing orders do not give the power to lay-off to the
employer, the employer would be bound to pay compensation
for the period of lay-off which ordinarily and general would be
equal to the full wages of the concerned workman.
HELD
The Supreme Court allowed the appeals, finding that the layoffs
were not justified under the Industrial Disputes Act, 1947, as the
company did not have the inherent power to lay off workers without
adequate legal or contractual provisions.

The Court ruled that the workers were entitled to compensation for
the layoff period, modifying the tribunal's orders accordingly.

The judgment underscores that layoffs must adhere to specific

conditions outlined in the employment contract or relevant
laws, protecting workers' rights against unjustified layoffs.
The Associated Cement
Companies Limited,
Chaibasa Cement Works vs.
Their Workmen
FACTS
The Associated Cement Companies Limited operated a cement
factory in Chaibasa, Bihar, and a nearby limestone quarry, which
was the primary source of raw material for cement production.

Due to a strike at the limestone quarry, the company had to lay

off workers at the cement factory because of the non-supply of
limestone, leading to a shutdown of certain sections of the factory.

The workers laid off during this period demanded lay-off

compensation under Section 25C of the Industrial Disputes Act,
1947. The company, however, cited Clause (iii) of Section 25E,
arguing that no compensation was due since the lay-off was due to
a strike in another part of the establishment, implying the limestone
quarry was part of the same establishment as the cement factory.
25E. WORKMEN NOT ENTITLED TO
COMPENSATION IN CERTAIN CASES

No compensation shall be paid to a workman who has been

laid-off-

(i) if he refuses to accept any alternative employment in the same

establishment (...);

(ii) if he does not present himself for work at the establishment at

the appointed time during normal working hours at least once a
day;

(iii) if such laying-off is due to a strike or slowing-down of

production on the part of workmen in another part of the
establishment.
ISSUE
WHETHER THE LIMESTONE QUARRY AND THE
CEMENT FACTORY CONSTITUTED ONE
ESTABLISHMENT FOR THE PURPOSES OF LAY-
OFF COMPENSATION UNDER THE INDUSTRIAL
DISPUTES ACT, 1947.
ANALYSIS
The Supreme Court, in interpreting Sections 25C and 25E of the
Industrial Disputes Act, considered several factors to determine
whether the limestone quarry and the cement factory
constituted a single establishment.

These factors included unity of ownership, management, and

control, unity of employment and conditions of service, functional
integrality, geographical proximity, and the general unity of purpose
between the quarry and the factory.

The Court also examined the legislative intent behind the

provisions, emphasizing the objective to alleviate the hardship
caused by involuntary unemployment and thereby interpreting
the statute liberally in favor of the employees.
ANALYSIS
It is, perhaps, impossible to lay down any one test as an absolute
and invariable test for all cases. The real purpose of these tests is
to find out the true relation between the parts, branches, units
etc. If in their true relation they constitute one integrated whole,
we say that the establishment is one; if on the contrary they do
not constitute one integrated whole, each unit is then a separate
unit.

•The difficulty of applying these tests arises because of the

complexities of modern industrial organisation; many enterprises
may have functional integrality between factories which are
separately owned; some may be integrated in part with units or
factories having the same ownership and -in part with factories or
plants which are independently owned.
HELD
We do not say that it is usual in industrial practice, to have one
establishment consisting of a factory and a mine; but we have to
remember the special facts of this case where the adjacent
limestone quarry supplies the raw material, almost exclusively,
to the factory ; the quarry is indeed a feeder of the factory and
without limestone from the quarry, the factory cannot function.

Moreover, the strike was called by the same union which

consisted of workers of the factory and the quarry.

So, disqualification under s. 25-E (iii) came into play and the
workmen of the cement factory could not claim compensation
for their lay-off.
Management of Kairbetta
Estate v. Rajamanickam AIR
1960 SC 893
FACTS
On July 26, 1957, Mr. Ramakrishna Iyer, the Estate's Manager, was
assaulted by some workmen, resulting in him sustaining six fractures.

Following this event, threats by the workmen towards the estate's staff
escalated to the point where three staff members, fearing for their lives
and faced with threats of murder if they continued working in the
estate's Kelso Division, communicated their inability to work under
such conditions.

Consequently, the estate management decided to close the Kelso

Division temporarily on July 27, 1957, citing the violence and threats as
the reason. This closure lasted until September 2, 1957, when, following
conciliation efforts by a labour officer and assurances from the
respondents of no further trouble, the division was reopened.
CONTENTIONS
The workers made a claim for lay-off compensation for the period
during which the lower division was closed on the footing that the
management for their own reasons did not choose to run the
division during that period. They agreed that the said action was a
lock-out but a lock-out falls within the definition of lay-off and
that is the basis for their claim for layoff compensation.

The company’s answer was that the closure of the division

amounted to a lock-out which under the circumstances was
perfectly justified and the workers were not entitled to claim
any lay-off compensation.
ISSUE
DOES A LOCK-OUT FALL UNDER S. 2(KKK)
WHICH DEFINES A LAY-OFF ?
LAYOFF V. LOCKOUT
It is clear that lay-off takes place for one or more of the reasons
specified in the definition. Lay-off may be due to shortage of coal
or shortage of power or shortage of raw materials or accumulation
of stocks or breakdown of machinery or any other reason. " Any
other reason " to which the definition refers must, we think, be
a reason which is allied or analogous to reasons already
specified.

A lock-out, as defined in Section 2(l) of the Act, involves the closing

of a place of employment, suspension of work, or the refusal by an
employer to continue employing any number of persons as a
response to a dispute, aiming to compel the employees to accept
certain terms.
ANALYSIS
Historically, the definition of lock-out included an additional clause
emphasizing that such actions must occur as a consequence of a
dispute and are aimed at compelling employees to accept
specific employment terms.

Though this clause was removed, the essence of a lock-out

remains the antithesis of a strike. It is a tool for employers, similar
to how strikes serve employees, to assert demands or viewpoints.

The application of both strategies—strikes by employees and lock-

outs by employers—is regulated by the Industrial Disputes Act.
Stated broadly lay-off generally occurs in a continuing business,
whereas a lock-out is the closure of the business. In the case of a
lay-off, owing to the reasons specified in s. 2(kkk) the employer is
unable to give employment to one or more workmen. In the case
of a lock-out the employer closes the business and locks out the
whole body of workmen for reasons which have no relevance to
causes specified in s. 2(kkk).

The nature of the two concepts is entirely different and so are their
consequences. In the case of a lay-off the employer may be liable to
pay compensation as provided by s. 25(C), (D) and (E) of the Act; but
this liability can-not be invoked in the case of a lock-out.

The liability of the employer in cases of lock-out would depend

upon whether the lock-out was justified and legal or not; but
whatever the liability, the provisions applicable to the payment of
lay-off compensation cannot be applied to the cases of lockout.
HELD
Therefore, we hold that the lock-out in the present case was not a
lay-off, and as such the respondents are not entitled to claim any
lay-off compensation from the appellant.

Incidentally we would like to add that the circumstances of this

case clearly show that the lock-out was fully justified. The
appellant's Manager had been violently attacked and the other
members of the staff working in the lower division were threatened
by the respondents.

In such a case if the appellant locked out his workmen no

grievance can be made against its conduct by the respondents.
LOCKOUT
Section 2(l), Chapter V
DEFINITION
SECTION 2(L)
“lock-out” means the temporary closing of a place of employment,
or the suspension of work, or the refusal by an employer to continue
to employ any number of persons employed by him;
ILLEGAL LOCK-OUTS
22. PROHIBITION OF STRIKES AND LOCK-OUTS.
(2) No employer carrying on any public utility service shall lock-out
any of his workmen—
(a) without giving them notice of lock-out as hereinafter provided,
within six weeks before locking out; or
(b) within fourteen days of giving such notice; or
(c) before the expiry the date of lock-out specified in any such
notice as aforesaid; or
(d) during the pendency of any conciliation proceedings before a
conciliation officer and seven days after the conclusion of such
proceedings.
(3) The notice of lock-out or strike under this section shall not be
necessary where there is already in existence a strike or, as the
case may be, lock-out in the public utility service, but the
employer shall send intimation of such lock-out or strike on the
day on which it is declared, to such authority as may be specified
by the appropriate Government either generally or for a particular
area or for a particular class of public utility services.
EXPLANATION

When there is already an ongoing strike or lockout within the same

public utility service, the requirement to give a 14-day advance
notice for a new strike or lockout is waived.

However, even in scenarios where the 14-day notice is not required

due to the ongoing strike or lockout, the employer is still obligated
to send an intimation (or notification) of such a strike or lockout to a
designated authority. This intimation must be sent on the same day
that the strike or lockout is declared.
23. GENERAL PROHIBITION OF STRIKES AND
LOCK-OUTS.—
No workman who is employed in any industrial establishment shall
go on strike in breach of contract and no employer of any such
workman shall declare a lock-out—

(a) during the pendency of conciliation proceedings before a

Board and seven days after the conclusion of such proceedings;
(b) during the pendency of proceedings before a Labour Court,
Tribunal or National Tribunal and two months after the
conclusion of such proceedings;
(bb) during the pendency of arbitration proceedings before an
arbitrator and two months after the conclusion of such
proceedings, where a notification has been issued under sub-
section (3A) of section 10A; or
(c) during any period in which a settlement or award is in
operation, in respect of any of the matters covered by the
settlement or award.
24. ILLEGAL STRIKES AND LOCK-OUTS
(1) A strike or a lock-out shall be illegal if—

(i) it is commenced or declared in contravention of section 22 or

section 23; or
(ii) it is continued in contravention of an order made under sub-section
(3) of section 10 [or sub-section (4A) of section 10A].

(2) Where a strike or lock-out in pursuance of an industrial dispute has

already commenced and is in existence at the time of the reference
of the dispute to a Board, an arbitrator, a Labour Court, Tribunal or
National Tribunal, the continuance of such strike or lock-out shall
not be deemed to be illegal, provided that such strike or lock-out was
not at its commencement in contravention of the provisions of this
Act or the continuance thereof was not prohibited under sub-section (3)
of section 10 or sub-section (4A) of section 10A.

(3) A lock-out declared in consequence of an illegal strike or a

strike declared in consequence of an illegal lock-out shall not be
deemed to be illegal.
RETRENCHMENT
Section 2(oo), Chapters VA and VB
DEFINITION
SECTION 2(OO)
The termination by the employer of the service of a workman for
any reason whatsoever, otherwise than as a punishment
inflicted by way of disciplinary action, but does not include -

(a) voluntary retirement of the workman, or

(b) retirement of the workman on reaching the age of

superannuating; or

(bb) termination under contractual stipulation/expiry; or

(c) termination of the service of a workman on the ground of

continued ill-health;
RETRENCHMENT
THE ESSENTIALS OF RETRENCHMENT-
No workman employed in any industry who has been in continuous
service for not less than one year under an employer shall be
retrenched by that employer until-
1. The workman has been given one month’s notice in writing
indicating the reasons for retrenchment and the period of notice
has expired, or the workman has been paid in lieu of such notice,
wages for the period of the notice;
2. The workman has been paid, at the time of retrenchment,
compensation which shall be equivalent to fifteen days’
average pay for every completed year of continuous service or
any part thereof in excess of six months; and
RETRENCHMENT
(3) Notice in the prescribed manner is served on the appropriate
Government for such authority as may be specified by the
appropriate Government by notification in the Official Gazette.

(4) If there exists an agreement specifying a date of termination of

service, no notice is necessary in such cases

(5) Compensation is equivalent to 15 days average pay for every

completed year of service or any service or any part thereof in excess
of six months; and

(6) Notice in the manner prescribed in Rule 76 of the Industrial

Dispute Rules 1957 should be served by the appropriate
government.
Hariprasad Shiv Shankar
Shukla v A.D. Divelkar
AIR 1957 SC 121
FACTS
BARSI LIGHT RAILWAY COMPANY:
Under a governmental agreement, the Barsi Light Railway Company
was notified that its undertakings would be purchased and taken
over. Consequently, employees were informed that their services
would be terminated, although the government intended to re-
employ most of them under new terms.

SHRI DINESH MILLS LIMITED:

Facing financial losses, Shri Dinesh Mills Limited decided to close
down its operations entirely. This led to the termination of their
entire workforce, a decision driven purely by the financial
unsustainability of continuing the business.
ISSUES
WHETHER THE TERMINATION OF SERVICES DUE
TO THE TAKEOVER OF A BUSINESS OR CLOSURE
OF A BUSINESS CONSTITUTES "RETRENCHMENT"
UNDER THE INDUSTRIAL DISPUTES ACT, 1947.

WHETHER THE WORKERS WERE ENTITLED TO

COMPENSATION UNDER SECTION 25F OF THE
ACT DUE TO THEIR TERMINATION.
ANALYSIS
The definition, when analysed, consists of the following four
essential requirements-

(a) termination of the service of a workman; (b) by the

employer; (c) for any reason whatsoever; and (d) otherwise than
as a punishment inflicted by way of disciplinary action. It must
be conceded that the definition is in very wide terms.

The question is if the term goes so far beyond the accepted notion
of retrenchment as to include the termination of services of all
workmen in an industry when the industry itself ceases to exist
on a bona fide closure or discontinuance of his business by the
employer
PIPRAICH SUGAR MILLS LTD. V. PIPRAICH SUGAR MILLS
MAZDOOR UNION

Retrenchment connotes in its ordinary acceptation that the

business itself is being continued but that a portion of the staff
or the labour force is discharged as plussage and the termination
of services of all the workmen as a result of the closure of the
business cannot therefore be properly described as retrenchment.

What after all is the meaning of the expression 'for any reason
whatsoever'? When a portion of the staff or labour force is
discharged as surplusage in a running or continuing business,
the termination of service which follows may be due to a variety of
reasons; e.g., for economy, rationalization in industry, installation of
a new labour saving machinery etc. The legislature in using the
expression 'for any reason whatsoever' says in effect: "It does
not matter why you are discharging the surplus; if the other
requirements of the definition are fulfilled, then it is
retrenchment.”
"It cannot be doubted that the entire scheme of the Act assumes
that there is in existence an industry, and then proceeds onto
provide for various steps being taken, when a dispute arises in that
industry. Thus, the provisions of the Act relating to lock-out, strike,
lay-off, retrenchment, conciliation and adjudication proceedings,
the period during which the awards are to be in force, have
meaning only if they refer to an industry which is running and
not one which is closed."

The industrial dispute to which the provisions of the Act apply

is only one which arises out of an existing industry. Therefore,
where the business has been closed and it is either admitted or
found that the closure is real and bona fide, any dispute arising with
reference thereto would, as held to fall outside the purview of the
Industrial Disputes Act.
SECTION 25 (FF)
Where the ownership or management of an undertaking is
transferred (..) every workman who has been in continuous service
for not less than one year(..) shall be entitled to notice and
compensation in accordance with the provisions of section 25F, as if
the workman had been retrenched.

We are aware that on a narrower interpretation of the definition

clause on the basis of the ordinary, accepted connotation of
retrenchment,, s. 25F will apply to a continuing or running
business only and s. 25FF will become largely unnecessary.

We do not think that consideration need cause any difficulty; the

judicial decisions on the basis of which s. 25FF was enacted being
held to be erroneous by us, no hardship is caused if s. 25FF is
rendered superfluous, because its aim is served by the correct
interpretation now given of the definition clause and of the
provisions of s. 25F, both of which are on that interpretation brought
into harmony with the rest of the Act.
HELD
The Court concluded that the terminations in question did not
constitute "retrenchment" as defined by the Industrial Disputes
Act, 1947. Therefore, the employees were not entitled to
retrenchment compensation under Section 25F of the Act.

The Court underscored that the Act envisages a running or

ongoing industry, where retrenchment is aimed at adjusting the
workforce size, not compensating for termination due to business
closure or takeover.
Punjab Land Development
Officer v. Presiding Officer
(1990) 3 SCC 682
The Supreme Court's decision in Hariprasad's case led to the
Industrial Disputes (Amendment) Act 1957. The amendment was
necessitated by the Supreme Court ruling that workmen whose
services were terminated due to genuine business closure or
ownership transfer weren't entitled to retrenchment compensation
under section 25F of the Industrial Disputes Act, 1947.

This situation was creating hardship by leaving many workers

unemployed without compensation. To address these issues and
provide relief to workers, immediate action was taken through the
ordinance, applied retrospectively from December 1, 1956.

This Ordinance was replaced by an Act of Parliament enacting the

provisions contained in sections 25FF and 25FFF. These sections
provide that 'compensation would be payable to workmen
whose services are terminated on account of the transfer or
closure of undertakings.'
ANALYSIS
Definition of 'retrenchment' in Section 2(oo) means termination by
the employer of the service of a workman for any reason
whatsoever, otherwise than as a punishment inflicted by way of
disciplinary action and those expressly excluded by the definition.

This is the wider literal interpretation as distinguished from the

narrow, natural and contextual interpretation of the word to
mean termination by the employer of the service of a workman
as surplus labour for any reason whatsoever.
ANALYSIS
The learned counsel for the employers contend that the word
'retrenchment' as defined in s. 2(00) of the Act means termination
of service of a workman only by way of surplus labour for any reason
whatsoever. The learned counsel representing the workmen
counted that 'retrenchment' means termination of the service of a
workman for any reason whatsoever, other than those expressly
excluded by the definition in s. 2(00) of the Act.

The express exclusion of volitional element in cl. (a) and (b) of

Section 2(oo) namely, voluntary retirement, and retirement on
superannuation age implies that those would otherwise have
been included. If such cases were to be included, termination on
abandonment of service, on efflux of time and on failure to qualify,
though only consequential or resultant would be included as those
have not been excluded.
HELD
Gammon India vs. Niranjan Dass (1984) 1 SCC 509:

The termination of service for the reasons mentioned (i.e. reduction

of volume in business) in the notice is not covered by any of the
clauses (a), (b) and (c) of s.2(oo) which defines retrenchment and it
is by now well settled that where the termination of service does
not fall within any of the excluded categories, the termination
would be ipso facto retrenchment.

It was not even attempted to be urged that the case of the

respondent would fall in any of the excluded categories. It is
therefore indisputably a case of retrenchment."
HELD
In our view, the principle of harmonious construction implies that in
a case where there is a genuine transfer of an undertaking or
genuine closure of an undertaking as contemplated in the
aforesaid sections, it would be inconsistent to read into the
provisions a right given to workman "deemed to be retrenched" a
right to claim re- employment as provided in section 25H.

In such cases, as specifically provided in the relevant sections the

workmen concerned would only be entitled to notice and
compensation in accordance with section 25F.
Uptron v Shammi Bhan
(1998) 6 SCC 538
FACTS
With effect from 7th of November, 1984, respondent 1 proceeded,
and remained till 29th January, 1985, on maternity leave.
Thereafter, she allegedly remained absent with effect from
30.1.1985 to 12.4.1985 without any application for leave and
consequently, by order dated 12th April, 1985, the petitioner
informed that her services stood automatically terminated in
terms of Clause 17 (g).

Clause 17(g) of the Certified Standing Orders, which constitutes the

bone of contention between the parties, is quoted below:
"The services of a workman are liable to automatic termination if
he overstays on leave without permission for more than seven
days. In case of sickness, the medical certificate must be submitted
within a week."
FACTS
The Tribunal, by its Award dated 21st July, 1992, held that the
termination of services of respondent 1 amounted to
"Retrenchment" within the meaning of Section 2(00) of the
Industrial Disputes Act and since all other legal requirements had
not been followed, the termination was bad and consequently she
was entitled to reinstatement as also fifty per cent of back
wages from the date of termination till reinstatement.

This Award was challenged by the petitioner through a Writ Petition

in the Allahabad High Court (Lucknow Bench) and the High Court,
by the impugned judgment dated 28.10.1997, dismissed the writ
petition upholding the findings of the Tribunal that termination
of respondent's services was "retrenchment".
ANALYSIS
(bb) termination of the service of the workman as a result of the
non-removal of the contract of employment between the
employer and the workman concerned on its expiry or of such
contract being terminated under a stipulation in that behalf
contained therein; or
ANALYSIS
The 1984 amendment to the Industrial Disputes Act, with Act 49,
added two exceptions to what constitutes "retrenchment" from
August 18, 1984: terminations due to the worker's prolonged ill-
health or the expiry of a contract that explicitly allows for such
termination. These cases are not considered "Retrenchment" under
Clause (bb) of Section 2(00).

What was contended was that the termination of the services of

respondent was covered by Clause (bb) of Section 2(00) and,
therefore, it could not be treated as "Retrenchment" with the result
that other statutory provisions, specially those contained in Section
25F of the Act were not required to be complied with.
HELD
The contract of employment referred to in the earlier part of
Clause (bb) has to be the same as is referred to in the latter
part. This is clear by the use of words "such contract" in the earlier
part of this Clause.

What the clause, therefore, means is that there should have been a
contract of employment for a fixed-term between the employer and
the workman containing a stipulation that the services could be
terminated even before the expiry of the period of contract.

If such contract, on the expiry of its original period, is not

renewed and the services are terminated as a consequence of
that period, it would not amount to "Retrenchment".
Anand Bihari and others
v RSRTC and another
1991 Lab IC 494
FACTS
The appellants (in C.A. No. 1859-61) were appointed as drivers and
had put in a long service to the satisfaction of the respondent
Corporation.

Subsequently on their medical examination it was found that they

had developed defective eyesight i.e. they did not have the
required vision for driving the buses.

The respondent Corporation issued notices to them and after

considering their explanation terminated their services on the
ground that they were unfit for driving buses.
FACTS
•Civil Appeal 1: On their medical examination it was found that the
appellant had developed defective eye-sight i.e. they did not have
the required vision for driving the buses. The respondent
Corporation issued notices to them and after considering their
explanation terminated their services on the ground that they were
unfit for driving buses.
•Civil Appeal 2: The driver developed weak eye-sight on account
of an accident in the course of his employment. He was given
employment as a helper but subsequently his services as a helper
were terminated.
•Civil Appeal 3: The services of a driver were terminated on the
ground that he had lost vision of his right eye. He had vision in
one eye and was hired as a helper but then his employment was
terminated.
FACTS
The appellants filed Writ Petitions in the High Court challenging
their termination order contending that their termination was
illegal because:

(i) the termination amounted to retrenchment within the

meaning of section 2(00) of the Industrial Disputes Act, 1947 and
it was without compliance with the mandatory provisions of
Section 25-F of the Act;

(ii) pursuant to the agreement between the Workers' Union and

the Corporation, the respondent-Corporation was bound to
provide the alternative jobs to the unfit drivers.
CONTENTION OF THE APPELLANTS:
(i) since the expression "continued ill-health" as used in clause (c)
of section 2(00) of the Industrial Disputes Act, 1947 does not cover
the cases of a loss of limb or an organ or its permanent use and
covers cases only of a general physical or mental debility or
incapacity to execute the work, their termination not being
covered by the said clause amounted to retrenchment which was
illegal for non-compliance with Section 25F;

(ii) the workmen should have been given alternative jobs

irrespective of the fact whether there was an agreement or not
between the Corporation and the Union to provide alternative jobs
to unfit drivers.
ANALYSIS
If on account of a workman's disease or incapacity or debility in
functioning, the resultant product or the service is likely to be
affected in any way or to become a risk to the health, life or
property of the consumer, the disease or incapacity has to be
categorised as ill-health for the purpose of the sub-clause,
otherwise, the purpose of production for which the services of the
workman are engaged will be frustrated and worse still in cases
such as the present one they will endanger the lives and the
property of the consumers.

Therefore, any disorder in health which incapacitates an

individual from discharging the duties entrusted to him or
affects his work adversely or comes in the way of his normal and
effective functioning can be covered by the said phrase.
HELD
The termination of the services of the drivers in the present case
being covered by sub-clause (c) of Section 2(oo) would not
amount to retrenchment within the meaning of Section 2(oo) of
the Act.

However, there is no justification in treating the cases of workmen

like drivers who are exposed to occupational diseases and
disabilities on par with the other employees.

The workmen are not denizens of an Animal Farm to be

eliminated ruthlessly the moment they become useless to the
establishment.
HELD
The Supreme Court directed that the Corporation shall in addition
to giving each of the retired workmen his retirement benefits,
offer him any other alternative job which may be available and
which he is eligible to perform and in case no such alternative
job is available each of the workman shall be paid along with
his retirement benefits an additional compensatory amount
proportionate to the length of service rendered by the
employees and the balance of their service.

The termination of services of helper was unjustified and also

illegal being in contravention of the provisions of Section 25-F of
the Act.
Papnasam Labour Union
v. Madura Coats
1995 (1) SCC 501
FACTS
The said writ petition was moved by Respondent 1 Madura Coats
Ltd., for a declaration that Section 25-M of the Industrial Disputes
Act, 1947 as it stood under the Industrial Disputes (Amendment)
Act, 1976 insofar as it required prior permission to be obtained
to effect layoff is ultra vires and void.
25M. Prohibition of lay-off .-

(1) No workman (other than a badli workman or a casual workman)

whose name is borne on the muster-rolls of an industrial
establishment to which this Chapter applies shall be laid-off by his
employer except with the prior permission of the appropriate
Government (...), obtained on an application made in this
behalf, unless such lay-off is due to shortage of power or to natural
calamity, and in the case of a mine, such lay-off is due also to fire,
flood, excess of inflammable gas or explosion.

(2) An application for permission under sub-section (1) shall be

made by the employer in the prescribed manner stating clearly
the reasons for the intended lay-off and a copy of such
application shall also be served simultaneously on the workmen
concerned in the prescribed manner.
(4) Where an application for permission under sub-section (1) or sub-
section (3) has been made, the appropriate Government or the
specified authority, after making such enquiry as it thinks fit
and after giving a reasonable opportunity of being heard to the
employer, the workmen concerned and the persons interested
in such lay-off, may, having regard to the genuineness and
adequacy of the reasons for such lay-off, the interests of the
workmen and all other relevant factors, by order and for reasons
to be recorded in writing, grant or refuse to grant such
permission and a copy of such order shall be communicated to the
employer and the workmen.

(5) Where an application for permission under sub-section (1) or sub-

section (3) has been made and the appropriate Government or the
specified authority does not communicate the order granting or
refusing to grant permission to the employer within a period of
sixty days from the date on which such application is made, the
permission applied for shall be deemed to have been granted on
the expiration of the said period of sixty days.
(6)An order of the appropriate Government or the specified
authority granting or refusing to grant permission shall, subject to
the provisions of sub-section (7), be final and binding on all the
parties concerned and shall remain in force for one year from the
date of such order.

(7)The appropriate Government or the specified authority may,

either on its own motion or on the application made by the
employer or any workman, review its order granting or refusing to
grant permission under sub-section (4) or refer the matter or, as the
case may be, cause it to be referred, to a Tribunal for
adjudication:

Provided that where a reference has been made to a Tribunal under

this sub-section, it shall pass an award within a period of thirty
days from the date of such reference.
(8)Where no application for permission under sub-section (1) is
made, or where no application for permission under sub-section (3)
is made within the period specified therein, or where the permission
for any lay-off has been refused, such lay-off shall be deemed to
be illegal from the date on which the workmen had been laid-off
and the workmen shall be entitled to all the benefits under any
law for the time being in force as if they had been not laid-off.

(10)The provisions of section 25-C (other than the second proviso

thereto) shall apply to cases of lay-off referred to in this section.

Explanation .-For the purposes of this section, a workman shall not

be deemed to be laid-off by an employer if such employer offers
any alternative employment (..) in the same establishment from
which he has been laid-off or in any other establishment belonging
to the same employer, (..) provided that the wages which would
normally have been paid to the workman are offered for the
alternative appointment also.
EXCEL WEAR CASE
The SC scrutinized the provisions of Section 25-O, which required
industrial establishments to obtain prior permission from the
appropriate government before closing down. The challenge was
based on the contention that such a requirement curtailed the
employers' right to close their businesses and was thus violative of
their fundamental rights under the Constitution of India.

The Supreme Court held that the requirement of obtaining prior

permission for closure from the government was not
unconstitutional but emphasized the need for a balanced
consideration of the interests of both the workers and the employer
in such scenarios. It also highlighted the government's role in
considering the impact of a potential closure on workers and the
necessity of protecting workers from arbitrary layoffs and closures.
ANALYSIS
The argument raised was regarding the High Court's decision
invalidating Section 25-M by analogously applying the reasons the
Supreme Court used to strike down Section 25-O in Excel wear.

The contention is that there are significant differences in the

procedural and substantive aspects of Sections 25-M and 25-N
when compared with 25-O, particularly in the way decisions on
laying off and retrenchment must be reasoned and communicated.

The main difference pointed out was that in sub-section (3) of

Section 25-M, the authority while granting or refusing permission to
the employer to layoff was required to record reasons in writing
and in sub-section (4) a provision was made that the permission
applied for shall be deemed to have been granted on the
expiration of the period of two months. months.
The period provided in sub-section (4) enjoins the authority to
pass the order one way or the other within the said period.

Similarly, in sub-section (2) of Section 25-N reasons are required to

be recorded in writing for grant or refusal of the permission for
retrenchment and the provision for retrenchment and the provision
for deemed permission was made in subsection (3) on the failure of
the governmental authority to communicate the permission or the
refusal within a period of three months.

The learned counsel has submitted that Section 25-M and

Section 25-N have common distinguishing features which make
the said two provisions different from Section 25-0 the validity
of which was considered by this Court in Excel Wear case'.

In the aforesaid circumstances, the decision rendered in Excel Wear

case is not applicable for deciding the constitutional validity of
Section 25-M.
HELD
It may not be unlikely that in some cases an employer may suffer
unmerited hardship up to a period of two months within which his
application for lay- off is required to be disposed of by the authority
concerned but having undertaken a productive venture by
establishing an industrial unit employing a large labour force, such
employer has to face such consequence on some occasions and
may have to suffer some hardship for sometime but not exceeding
two months within which his case for a lay-off is required to be
considered by the authority concerned otherwise it will be deemed
that permission has been accorded. Hence, procedural
reasonableness has been taken care of by these provisions.

The restriction appears necessary to us in larger public interest

and to protect the interest of workmen, who, but for the
restriction may be subjected to uncalled for lay- off.
STRIKE
Section 2(q), Chapter V
DEFINITION
SECTION 2(Q)

"Strike" means a cessation of work by a body of persons

employed in any industry acting in combination, or a concerted
refusal, or a refusal, under a common understanding of any
number of persons who are or have been so employed to
continue to work or accept employment.

Whenever employees want to go on strike they have to follow the

procedure provided by the Act otherwise the strike is deemed to be
an illegal strike.
Section 22(1) of the industrial Dispute Act, 1947 provides that no
person employed in public utility service shall go on strike in
breach of contract:

1. Without giving to employer notice of strike with in six weeks

before striking; or

2. Within fourteen days of giving such notice; or

3. Before the expiry of the date of strike specified in any such notice
as aforesaid; or

4. During the pendency of any conciliation proceedings before a

conciliation officer and seven days after the conclusion of such
proceedings.
The provisions of section 23 impose general restrictions on
declaring strike in breach of contract in the both public as well as
non- public utility services in the following circumstances mainly:

1. During the pendency of conciliation proceedings before a board

and till the expiry of 7 days after the conclusion of such
proceedings;
2. During the pendency and 2 months after the conclusion of
proceedings before a Labour court, Tribunal or National Tribunal;
3. During the pendency and 2 months after the conclusion of
arbitrator, when a notification has been issued under sub-
section 3 (a) of section 10 A;
4. During any period in which a settlement or award is in operation
in respect of any of the matter covered by the settlement or
award.
24. Illegal strikes and lock-outs.—

(1) A strike or a lock-out shall be illegal if—

(i) it is commenced or declared in contravention of section 22 or
section 23; or
(ii) it is continued in contravention of an order made under sub-
section (3) of section 10 [or sub-section (4A) of section 10A].

(2) Where a strike or lock-out in pursuance of an industrial dispute

has already commenced and is in existence at the time of the
reference of the dispute to a Board, an arbitrator, a Labour Court,
Tribunal or National Tribunal, the continuance of such strike or lock-
out shall not be deemed to be illegal, provided that such strike
or lock-out was not at its commencement in contravention (..)

(3) A lock-out declared in consequence of an illegal strike or a

strike declared in consequence of an illegal lock-out shall not
be deemed to be illegal.
PENALTY
26. Penalty for illegal strikes and lock-outs.—

(1) Any workman who commences, continues or otherwise acts in

furtherance of, a strike which is illegal under this Act, shall be
punishable with imprisonment for a term which may extend to
one month, or with fine which may extend to fifty rupees, or
with both.

(2) Any employer who commences, continues, or otherwise acts in

furtherance of a lock-out which is illegal under this Act, shall be
punishable with imprisonment for a term which may extend to
one month, or with fine which may extend to one thousand
rupees, or with both.
State of Bihar v. Deodhar Jha
AIR 1958 Pat 51
FACTS
Dispute arose between Patna Electric Supply Company, Limited
(PESCO) and its workers, represented by the Patna Electric Supply
Workers' Union, leading to government arbitration.

An employee, Ramdeo Rai, was suspended for disobeying

management's accommodation sharing order. Following an
altercation among workers over this issue, additional suspensions
were enacted.

Viewing these suspensions as victimization, the Union notified

PESCO of a 24-hour "token strike" in protest, despite ongoing
arbitration.
ISSUE
WAS THE STRIKE WAS ILLEGAL DUE TO
IMPROPER NOTIFICATION AND TIMING DURING
ARBITRATION.

WAS THE SUSPENSION A LOCK-OUT?

It has been urged on behalf of the respondents that it was not a
strike in the real sense of the term, but it was a cessation from
work for a little while only to express the employees' views about
the punishment meted out by the Company to those workers who
had been suspended by the Manager on account of alleged
indulging in riotous behaviour before a public servant. Stoppage of
work or refusal to do work by some workmen in combination
for a short while only cannot be termed a "strike".

A "strike" may be for a short period or for a long period. The length
of time has nothing to do with the meaning of "strike" as given
in the Act.

Buckingham and Carnatic Co., Ltd. v Workers of Buckingham and

Carnatic Co. Ltd: stoppage and refusal to work for a few hours
only was held to amount to a 'strike" within the definition of
Section 2 (q) of the Act.
ANALYSIS
On these material facts, I hold that a large number of workers in the
Company, including the five respondents aforesaid, did go on
strike in breach of contract.

As pointed out before, a strike of this nature is prohibited in law in

public utility services unless the conditions referred to in the
four Clauses (a), (b), (c) and (d) are satisfied.

These, admittedly, have not been done by the employees and,

hence, there is no other alternative, but to hold that the five
respondents are guilty for illegal strike under Section 26 of the
Act.
ANALYSIS
The words of Clauses (a) and (b) of this section, according to this
decision, cover all strikes and lock-outs irrespective of the
subject-matter of the dispute being different from the subject-
matter of the dispute pending before a Tribunal or before a
Conciliation Authority.

It is true that the resolution regarding alleged victimisation of

workers and certain alleged pending demands were not for
consideration by the Tribunal, but that does not make any
difference inasmuch as the workers are not permitted in law to
resort to a strike during the pendency of a proceeding before a
Tribunal or a Board according to the conditions laid down both
under Section 22 and Section 23 of the Act.
ANALYSIS
Respondents argued that the company's suspension of workers over
a room allocation dispute in Patna amounted to an illegal lock-
out, potentially justifying their token strike under Section 24(3)
of the Industrial Disputes Act, which states that a strike in
response to an illegal lock-out is not deemed illegal.

The controversy centers on whether disciplinary suspensions can

be classified as a lock-out. When the company suspended
employees following disruptive behavior during a dispute
mediation, it was argued as a disciplinary action, not a lock-out as
defined by the Act. Since the suspensions aimed to terminate
employment rather than temporarily halt work, the court found
such actions did not meet the criteria of a lock-out, hence not
justifying the strike as legal.
HELD
The court reasoned that the strike was illegal under Sections 22
and 23 due to non-compliance with notification requirements
and its occurrence during the ongoing arbitration.

It further held that the suspensions were disciplinary actions, not

a lock-out, and thus did not justify the strike.
Ramnagar Cane and Sugar
Company v. Jatin Chakravorty
AIR 1960 SC 1012
FACTS
The Ramnagar Cane and Sugar Co. Ltd. (the appellant), a public
utility concern involved in sugar manufacturing, faced a strike
initiated on February 13, 1954, by a minority of its workers
represented by the Ramnagar Sugar Mill Workers' Union (the
Workers' Union).

This strike coincided with ongoing conciliation proceedings

between the company and another union, the Ramnagar Cane &
Sugar Co. Employees' Union (the Employees' Union), related to
similar demands by both unions covering all employees.

Subsequently, the company and the Employees' Union arrived at a

settlement, while the Workers' Union proceeded with their
strike.
ISSUE
WHETHER THE STRIKE INITIATED BY THE
WORKERS' UNION WAS ILLEGAL, SPECIFICALLY
VIOLATING SECTION 22(1)(D) DUE TO ONGOING
CONCILIATION PROCEEDINGS WITH THE
EMPLOYEES' UNION.
ANALYSIS
Section 18(3)(d) makes it clear that, where a party referred to in cl.
(a) or (b) is composed of workmen, all persons who were
employed in the establishment or part of the establishment, as
the case may be, to which the dispute relates on the date of the
dispute and all persons who subsequently become employed in
that establishment or part, would be bound by the settlement.

There can be no doubt that the settlement arrived at between the

appellant and the Employees' Union would bind not only the
members of the said Union but all workmen employed in the
establishment of the appellant at that date. That inevitably means
that the respondents would be bound by the said settlement even
though they may belong to the rival Union.
In order to bind the workmen, it is not necessary to show that the
said workmen belong to the Union which was a party to the dispute
before the conciliator. The whole policy of s.18 appears to be to give
an extended operation to the settlement arrived at in the course of
conciliation proceedings.

When the said provision refers to the pendency of any conciliation

proceedings it must reasonably be construed to mean any
conciliation proceedings which may lead to a settlement before the
conciliation officer and which settlement may bind all the workmen
concerned; in other words, if a conciliation proceeding is pending
between one union and the employer and it relates to matters
concerning all the employees of the employer, the pendency of
the said conciliation proceeding would be a bar against all the
employees of the employer employed in a public utility service
to go on a strike during the pendency of the said proceeding
under s. 22(1)(d).
HELD
The demands made are no doubt by two Unions but they cover
the same ground and in effect they represent the demands
made by the whole body of workmen.

In fact the conciliation settlement reached between the appellant

and the Employees' Union has benefited the members of the
Workers' Union as much as those of the Employees' Union.

That being so we think the courts below were in error in putting an

unduly narrow and restricted construction on the provisions of
s.22(1)(d) of the Act.
PC Roy v. Raycom
AIR 1964 Cal 221
FACTS
P.C. Roy and Co. (India) Private Limited, a company operating in the
Andaman and Nicobar Islands, faced an industrial dispute with its
workers represented by the Raycom Forest Labour Union.

The company experienced financial difficulties leading to wage

arrears since 1957, resulting in recurrent strikes by its workers
in 1959 and 1960 to demand unpaid wages.

Consequent to these disputes, an arbitration agreement was formed

under Section 10A of the Industrial Disputes Act, 1947, and the
matter was referred to arbitration to resolve disputes regarding
wage payments for the strike periods.
FACTS
Notice of the arbitration proceeding was served upon the parties,
caning upon them to file their respective objections and then
matter was heard and decided by the Arbitrator, who made his
award on 30th June, 1961. It is against this award that this
application has been made.

Shortly put, the Arbitrator has found that the employer was in
default in paying wages of the workmen upto 11th August, 1960
when it offered to pay the entire arrears. Before this date they
were in arrears from time to time and the workmen went on
strike alter serving notice upon the Company, in order to
compel the Company to make payment.
FACTS
The Arbitrator has held that an employer should always be ready
to pay workmen their wages, after the same had become due,
and it is no answer to say that the employer is in financial
embarrassment therefore, upto the date when it was in a
position to make the payment of all arrears, the strike was
justified, but the strike was not justified after that date.

He has, accordingly, directed payment of wages for the period upto

11th August, 1960, that is to say, from 11th January, 1960 to 3rd
February, 1960 and from 29th June, 1960 to 11th August, 1960
CONTENTIONS
Mr. Sinha, representing the petitioner, argued that the workers'
strike was unjustified, citing company allegations of violent
behavior, including refusing to load ships and releasing elephants.

Despite these claims, the Arbitrator found the strikes to be

peaceful, a decision Mr. Sinha admitted he could not counter
with concrete evidence, relying instead on company
statements.

Additionally, Mr. Sinha proposed that the Arbitrator should

consider the company's financial difficulties as a factor
indicating the company had no intention to act in bad faith.
HELD
The Arbitrator has taken the correct approach. Where a strike is in
contravention of the law, that is one thing. In such a case, the
law provides the remedy.

But, the principle that an employer must at all material time be

ready to pay his workmen their earned wages is correct. Workmen
who have done their work cannot under any circumstances be
deprived of the immediate payment of their wages, and the fact
that the employer is in a state of economic embarrassment
cannot justify the non-payment of such wages that being so.

I am unable to hold that an employer is justified in withholding the

wages of his workmen for work already done, on the ground that he
had not the money to pay them.
HELD
The principle of mala fides or bona fides certainly enter into
industrial adjudications, but applied to the facts and circumstances
of the present case it fails to support the case of the petitioner.

In other words, the non-payment of wages because of embarrassing

financial circumstances even if bona fide cannot be held to be
justified. I do not say that the non-payment necessarily introduces
any element of dishonesty en the part or the employer.

But if the absolute liability of the employer is at all times to be

ready and willing to pay the wages of workmen, it cannot be said
that he has a good excuse for non-payment because he has been
visited with cad luck or evil circumstances by which he is not able
to discharge his liability in proper time.
Gujarat Steel Tubes v
Mazdoor Sabha
AIR 1980 SC 1896
FACTS
Workmen went on a strike during the pendency of proceedings
before an industrial tribunal. Consequently, the management
after giving several notices to the strikers to resume their duties
by a specific date discharged all the 835 strikers and gave them
one month’s wages in lieu of notice.

During this period, the factory remained closed for over 4 months
and thereafter the work re-commenced with the help of new
workers.

Once again, the management made a final call offering all the
strikers to rejoin their duties by a specified date or else the
remaining vacancies would be filled by fresh recruits. Consequently,
out of 835 discharged strikers, 419 resumed their duties without
break in service.
ANALYSIS
We observe here also an unfortunate failure to separate and scan
the evidence with specific reference to charges against
individual workman.

On the contrary, all that we find in the award is an autopsy of the

strike by the Sabha and a study of its allegedly perverse postures.

A disciplinary inquiry resulting in punishment of particular

delinquents cannot but be illegal if the evidence is of mass
misconduct by unspecified strikers led by leaders who are
perhaps not even workmen.
ANALYSIS
Is there a punishment of any workman ? If yes, has it been preceded
by an enquiry ? If not, does not the Management desire to prove the
charge before the tribunal ? If yes, what is the evidence, against
whom, of what misconduct ? If individuated proof be forthcoming
and relates to an illegal strike, the further probe is this : was the
strike unjustified ? If yes, was the accused worker an active
participant therein ? If yes, what role did he play and of what acts
was he author ? Then alone the stage is set for a just punishment.

These exercises, as an assembly line process are fundamental.

In Crompton Greaves Ltd. v. Workmen this Court held that even if
a strike be illegal, it cannot be castigated as unjustified, unless
the reasons for it are entirely perverse or unreasonable-an
aspect which has to be decided on the facts and circumstances of
each case. In that decision, this Court awarded wages during the
strike period because the Management failed to prove that the
workmen resorted to force and violence.

In India General Navigation and Railway Co. Ltd. where the strike
was illegal and affected a public utility service, this Court observed
that "the only question of practical importance which may arise in
the case of an illegal strike, would be the kind or quantum of
punishment, and that, of course, has to be modulated in
accordance with the facts and circumstances of each case.... There
may be reasons for distinguishing the case of those who may
have acted as mere dumb-driven cattle from those who have
taken an active part in fomenting the trouble and instigating
workmen to join such a strike or have taken recourse to
violence."
We cannot agree that mere failure to report for duty, when a
strike is on, necessarily means misconduct. Many a workman, as
a matter of prudence, may not take the risk of facing the militant
workmen or the Management's hirelings for fear, especially
when there is evidence in the case from the Sabha that the
Management had hired goondas and from the Management that
the striking vanguard was violent.

It is also possible, in the absence of evidence to the contrary, that

several workmen might not be posted with the Management's
notice of recall or the terms on which they were being recalled.

In this view, we are not able to uphold the conclusion of the

arbitrator that the punishment of dismissal was appropriate for
the entire mass of workmen whose only guilt, as proved was
nothing more than passive participation in the illegal and
unjustified strike by not reporting for duty.
HELD
To determine the question of punishment, a clear distinction has
to be made between those workmen who are only joined in
such a strike, but also took part in obstructing the loyal
workmen from carrying on their work, or took part in violent
demonstrations, or acted in defiance of law and order, on the
one hand, and those workmen who were more or less silent
participators in such a strike, on the other hand.

It is not in the interest of the industry that there should be a

wholesale dismissal of all the workmen who merely participated in
such a strike.
INDUSTRIAL RELATIONS CODE

(zk) "strike" means a cessation of work by a body of

persons employed in any industry acting in combination,
or a concerted refusal, or a refusal, under a common
understanding, of any number of persons who are or have
been so employed to continue to work or to accept
employment and includes the concerted casual leave on a
given day by fifty per cent. or more workers employed in
an industry,