UNIT-4

A) CONCEPT OF STRIKE

Strike is collective stoppage of work by workmen undertaken in order to bring pressure upon those who
depend on the sale or use of the products of work. Lock-out is a weapon in the hands of the employer,
similar to that of strike in the armoury of workmen used for compelling persons employed by him to accept
his terms or conditions of or affecting employment.

I) GHERAO
It literally means to “surround”, to “confine” or to “seize”. Gherao means encirclement which is used to
criminally intimidate the employer to accept the demands of the workers. The essential ingredients of this
type of protest are:
(a) Encircling the management either with violence or without violence, and restricting their free movement
which may be called wrongful confinement, and
(b) To put a check, in various ways, on the free access to the outside communications, and
(c) Using coercive means to make the management to agree to the demand or charter of demands put forth
by a group of workers or their leaders or the officials and members of the Trade Union, if such Union exists,
and lastly,
(d) The workers technically commit the wrong of trespass on the property of the employers. Using abusive
language, unbecoming behaviour of workers and their leaders are also the common features of Gherao.

It amounts to criminal conspiracy under section 120-A of the Indian penal code and is not saved by section
17 of the trade unions act.

The meaning of criminal conspiracy as per Section 120A of the Indian Penal Code is an agreement done by
two or more persons for the commission of an illegal act. The act committed will be punishable with death,
imprisonment for life or imprisonment of either description of a term of 2 years or more.

The Trade Union Act, 1926 grants a registered trade union an immunity. Nevertheless, the immunity is only
applicable with regard to the legal agreements made by trade union members for the promotion of legitimate
trade union purposes. The right to call for a strike and persuade members is one of the rights granted to
registered trade unions in the stimulation of their industrial conflicts. Section 17 safeguards a trade union
from a crime if the arrangement they have entered into is not an agreement to conduct an offence.

In the case of West India Steel Company Ltd. vs. Azeez, a trade union representative protested against the
delegation of a worker to another sector by blocking or stopping work inside the factory for five hours. It
was decided that a worker in a factory had to obey the directives issued by his superiors. A trade union
leader is not exempt from following the rules. There is no legal authority for a trade union official or any
other employee to share managerial responsibilities.

The said principle was introduced as a formal means of protest in the labour sector by Subodh Banerjee,
labor minister in 1969 united front governments of west Bengal. Gherao can be punishable under sections
147, 148, 342, 506 of the IPC if it involves threat, violence. Gherao is usually short and also might land for a
few days, a peaceful Gherao consists crimes whereas violent Gherao posses a threat to the well-being and
the prop.

II) BANDH AND LOCK-OUT

Trade Unions resort to bandh when an industrial dispute reaches its extreme edge. When the employers fail
to find any solution to a problem or dispute and strike also fails to serve its purpose, then the weapon or
bandh, an aggressive form of strike, is let loose. Under it, trade unions try to get the work of all industrial
establishments stopped at the district or state level to get their demands fulfilled. In this situation, it is the
serious effort of the trade unions to ensure that different industrial institutions, non-industrial institutions,
schools, colleges, commercial establishment of the town or the state should remain closed, so that employers
could be pressurised.

Bandh is an aggressive form of strike. This extreme measure is used by different trade unions in our country,
in order to make their campaign a success.

Lock-out is the antithesis of strike. According to 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.
The following is to be satisfied to constitute a lockout-
1.(i) Temporary closing of place of employment by the employer or,
(ii) Suspension of work by the employer or,
(iii) Refusal by an employer to continue to employ any number of persons employed by him.
2. the above mentioned should be motivated by coercion.
3. an industry as per defined in the act.
4. a dispute in the industry.

In lock-out the relationship of employer-employee remains as before, only some links in that chain of
relationship are broken. Just as strike is a weapon available to the employees for enforcing their industrial
demands, a lock-out is a weapon available to the employer to persuade by a coercive process the employees
to see his point of view and to accept his demands.

III) TYPES OF STRIKE

Section 2(q) defines strike as meaning
 a cessation of work by a body of persons employed in any industry acting in combination or
 a concerned refusal of any number of persons who are or have been so employed to continue to work or
to accept employment, 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.

It was held by the Labour Appellate Tribunal in Standard Vacuum Oil Co. vs. Gunaseelam M.G., that
action of the employees applying en bloc for casual leave to celebrate May day was not strike. This decision
is not sound in view of the fact that all the ingredients of a strike are present in the present case, and under
all circumstances, it was a defiance of the authority of the management who refused to declare the day as
closed day as desired by the government.

There are mainly four kinds of strike which can be broadly classified as under:
1. General Strike: A general strike is one, where the workmen join together for a common cause and stay
away from work as a mark of protest thus depriving the employer of their labour to run the industry. In such
form of strike the collective action is taken by the workmen against the management in general with the
ultimate object to force the management to negotiate the settlement of dispute with the striking workmen.
Hartals and Bandhs also fall in this category. In these types, the motives are invariably political and the
public is inconvenienced to put pressure on the government to resolve the tangle. These are, therefore,
considered unjistified.
2. Stay in, sit down, and tool down and pen down strike: These are some of the variants of strike resorted
to by the workmen under different circumstances. Here in such cases the workmen enter the place of work
but do not do any work. They simply occupy their places of work and either stay in or sit down. In these
forms the employer is not allowed to carry on his business. The employer is also prevented to employ other
labourers to carry on his business. Factory workers staying inside the premises and refusing to work is also
known as sit down strike. Likewise, factory workers who refuse to work with their tools is known as Tool
Down Strike.
In the case of Punjab National Bank vs. Their Workmen, the Bank dismissed 150 employees for taking
part in a pen down strike. The Labour Appellate Tribunal reinstated 136 of them. The management
challenged the award for reinstatement before the Supreme Court on the ground of the conduct of the
employees in entering upon a pen down strike and its effect on their claim for reinstatement. The Supreme
Court held that it would be difficult to exclude a strike when workmen enter the premises of their
employment and refuse to take their tools in hand and start their usual work. Thus, pen down strike is a
strike and it cannot be considered illegal provided it is peaceful.
3. Go Slow Strike: In such a strike, the workmen do not stay away from work, they do come to their work
and work also but with a slow speed in order to lower down the production and thereby cause loss to the
employer. It is not a strike but is serious misconduct which is insidious in its nature and cannot be
countenanced.
The Supreme Court in Bharat Sugar Mill Ltd. vs. Jai Singh, held that “go slow” which is a picturesque
description of delaying of production by workmen pretending to be engaged in the factory is one of the most
pernicious practices that discontended or disgruntled workmen sometimes resort. For the delaying
production and thereby reducing the output, the workmen claim to have remained employed and thus to be
entitled to full wages.
4. Sympathetic Strike: A sympathetic strike is one which is called for the purpose of indirectly aiding
others. The striking employees having no demand or grievance of their own and the strike having no direct
relation to the advancement of the interest of the strikers. Such a strike is unjustifiable invasion on the right
of employees and is, therefore, unlawful.
In Kambalingam vs. Indian Metal and Metallurgical Corporation, Madras, it was held that when the
workers in concert absent themselves out of sympathy to some cause wholly unrelated to their employment
or even in regard to condition of employment of other workers in service under other management, such
absence could not be held to be strike, as the essential element of the intention to use it against the
management is absent. The management would be entitled to take disciplinary proceeding against the
workmen for their absence on the ground of breach of condition of service.

Apart from these hunger strike has also been considered as a form of strike by the court in the case of
Pipraich Sugar Mills Ltd. vs. Their Workmen.

IV) RIGHTS TO STRIKE AND LOCK-OUT

A strike is 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. Under the Industrial Disputes Act, 1947,
the right to strike is subject to certain conditions:
1. Notice of Strike: Employees must give notice of strike to the employer at least six weeks before going
on strike.
2. Prohibition during Conciliation and Adjudication: Strikes are prohibited during the pendency of
conciliation proceedings before a Board and seven days after the conclusion of such proceedings.
Similarly, strikes are prohibited during the pendency of adjudication proceedings before a Labour Court,
Tribunal, or National Tribunal and two months after the conclusion of such proceedings.
3. Public Utility Services: For industries classified as public utility services, a 14-day notice is required
before commencing a strike, and strikes are prohibited during the pendency of any conciliation
proceedings and seven days after the conclusion of such proceedings.
A lock-out is the temporary closing of a place of employment, the suspension of work, or the refusal by an
employer to continue to employ any number of persons employed by him. The Industrial Disputes Act, 1947,
also regulates the right of employers to declare a lock-out, with specific conditions:
1. Notice of Lock-out: Employers must provide notice of lock-out to the employees at least six weeks
before the lock-out.
2. Prohibition during Conciliation and Adjudication: Lock-outs are prohibited during the pendency of
conciliation proceedings before a Board and seven days after the conclusion of such proceedings.
Similarly, lock-outs are prohibited during the pendency of adjudication proceedings before a Labour
Court, Tribunal, or National Tribunal and two months after the conclusion of such proceedings.
3. Public Utility Services: In public utility services, a 14-day notice is required before declaring a lock-
out, and lock-outs are prohibited during the pendency of any conciliation proceedings and seven days
after the conclusion of such proceedings.

Both rights to strike and lock-out are regulated to ensure industrial peace and prevent abrupt disruptions that
could harm the interests of workers, employers, and the economy. The Act strikes a balance by allowing
these actions under regulated conditions, providing a legal framework to resolve industrial disputes amicably
and efficiently.

V) GENERAL PROHIBITION OF STRIKES AND LOCK-OUTS

The provisions of Section 23 are general in nature. It imposes general restrictions on declaring strikes in
breach of contract and lock-outs in both public utility as well as non-public utility services in the following
circumstances, namely:
(i) During the pendency of conciliation proceedings before a Board and fill the expiry of 7 days after the
conclusion of such proceedings,
(ii) During the pendency and two months after the conclusion of proceedings pending before a Labour Court,
Tribunal or National Tribunal,
(iii) During the pendency and two months after the conclusion of arbitration proceedings before an arbitrator
when a notification has been issued under Section 10A(3A), or
(iv) 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.

The words in various clauses of the section are of wide import and cover all strikes and lock-outs
irrespective of the subject-matter of the dispute pending before these authorities.

In the case of Ballarpur Collieries Co. vs. Salim M. Merchant, the Regional Labour Commissioner used his
good offices to arrive at a settlement while dealing with conciliation proceedings, but he did not act
according to the provisions of the Act. The matter in dispute at the time of strike was not covered by
settlement and therefore Section 23(c) was held to have no application in the case.

The settlement referred to in Section 23(c) which prohibits strike must be one which is binding on all
persons, therefore, any settlement arrived at privately which does not bind all the workmen, strike in breach
of such settlement would, therefore, not be illegal.

VI) PROHIBITION OF STRIKES AND LOCK-OUTS IN PUBLIC UTILITY

SERVICES

Section 22 of the Act lays down restrictions on the right to strike and lock-out in the public utility services.
The employer or the workmen is not restrained from declaring lock-out or going on strike but it is required
of them to fulfill certain conditions as enumerated in the section.

With respect to strike the law requires that in a public utility service, no person can go on strike in breach of
contract of service unless:
(a) A notice of strike has been given to the employer. The notice should be given within 6 weeks before
striking. In case workmen choose to go on strike, they can do so within 6 weeks from the date of notice.
After the expiry of 6 weeks, a fresh notice is required,
(b) A minimum of 14 days should have expired between the giving of notice and the date of strike,
(c) The strike shall not be resorted to before the date of strike specified in the notice, and
(d) The strike shall not be resorted to in the period during which any conciliation proceeding s are pending
and even after the conclusion of the proceedings during a further period of 7 days.

Similar conditions as stated above in the case of strike have to be satisfied before the employer can declare
lock-out to be legal under the Act. Any breach or contravention or non-compliance with the above
requirements of law before going on strike or declaring lock-out will make such a strike or lock-out illegal.

If, however, a strike is already in existence and the employer intends to declare lock-out or if lock-out is
already in existence and employees want to resort to strike, it is not necessary to give the notices as is
otherwise required. However, a duty is cast on the employer to send intimation of the lock-out declared by
him or of the strike declared by the workmen to such authority as may be specified by the appropriate
government.

VII) ILLEGAL STRIKES AND LOCK-OUTS

Section 24 of the Act lays down the grounds which make the strike and lock-out illegal which are as under:
(i) A strike or lock-out shall be illegal if it is commenced or declared in contravention of Section 22 in
public utility service.
(ii) A strike or lock-out shall be illegal if it is commenced or declared in contravention of Section 23 in any
industrial establishment.
(iii) A strike or lock-out shall be illegal if it is continued in contravention of an order made by appropriate
government under Section 10(3) or under Section 10A(4A) of the Act.

It is not all strikes and lock-outs which are prohibited under the scheme of the Act. The Act has prohibited
only certain types of strikes and lock-outs, which do no fit into the scheme of the Act. The right to strike and
lock-out, legitimate weapons in the hands of workers and employers respectively in the industrial field, has
been regulated by putting certain checks in order to achieve the object of harmonious relations between the
workers and employers. Therefore, strikes and lock-outs shall not be deemed to be illegal if:
(i) Their commencement is not in contravention of the provisions of the Act, or
(ii) Their continuance was not prohibited by the appropriate government under Section 10(3), or
(iii) A lock-out is declared in consequence of an illegal strike as laid down above or a strike is declared in
consequence of an illegal lock-out.

VIII) JUSTIFICATION OF STRIKES AND LOCK-OUTS

Sections 22, 23 and 24 of the Act are the main provisions which make the strike illegal, if these statutory
provisions of the Act are contravened. The purpose of the strike may make it illegal in other countries but
the same is not true in case of India. Here in India the distinction can be drawn between ‘justified’ and
‘unjustified’ strike. The question of justifiability or otherwise of a strike, therefore, would depend upon
whether the demands are bona fide for the betterment of conditions of service of workmen or whether they
are made frivolous or for any ulterior purpose. Strike resorted to for settlement of economic conditions like
wages, dearness allowance, bonus, provident fund, gratuity, loan and holiday would prima facie make it
justifiable. The question whether the strike in a particular case is justified or not is a mere question of fact?
The answer is that it is a mixed question of fact and law.

If the object of the strike be illegal under the provisions of the Act, the strike under the Indian law may be
unjustified but will not be illegal. Similarly, a strike may be legal if it is commenced without contravening
the statutory provisions and it may be justified if it is bona fide resorted to for the betterment of the
condition of service of workmen. A strike may be both legal and justified at the commencement but as if
progresses the strikers may resort to acts of violence and sabotage. Though such a strike may not become
illegal, it will certainly become unjustified with the resort to such acts on the part of the workmen. Whereas
an illegal strike is prima facie unjustified and therefore the question of justification of illegal strike is
irrelevant. That the two conclusions, that a strike is illegal and at the same time justified cannot in law exist.

The Supreme Court in the case of India General Navigation and Railway Co. Ltd. vs. Their Workmen,
clarifying the above position in law observed that the law has made a distinction between a strike which is
illegal and one which is not, but it has not made any distinction between an illegal strike which may be said
to be justifiable and one which is not justifiable. The distinction is not warranted by the Act, and is wholly
misconceived, specially in the case of employees in a public utility service. In other words, a strike which is
illegal must be unjustified is the natural conclusion from the above holding.

IX) PENALTIES FOR ILLEGAL STRIKES AND LOCK-OUTS

The State or the appropriate government has, therefore, been vested by the Act with powers to punish all
such persons including employers who resort to illegal strikes or lock-outs thereby putting out of gear the
industrial structure upon which the social interest depends to a very great extent. The following are the
provisions of the Act:
 Section 26 imposes on a workman punishment for commencing, continuing or otherwise acting in
furtherance of, a strike which is illegal under this Act. Such a person may be imprisoned for a term
which may extend to one month, or with fine which may extend to fifty rupees, or with both. 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.
 Section 27 of the Act states that any person who instigates or incites others to take part in, or otherwise
acts in furtherance of, a strike or lock-out which is illegal under this Act, shall be punishable with
imprisonment for a term which may extend to six months, or with fine which may extend to one
thousand rupees, or with both.
 The giving of financial aid to illegal strikes and lock-outs has also been made a penal offence under
Section 28 of the Act. The punishment is the same as prescribed under Section 27, namely,
imprisonment for a term which may extend to six months, or with fine which may extend to one
thousand rupees, or with both.
 The settlement arrived at or the award given in the process of industrial adjudication has been given
special sanctity under the scheme of the Act, namely, Section 29. therefore, any person who commits a
breach of any term of any settlement or award, which is binding on him under this Act, shall be
punishable with imprisonment for a term which may extend to six months, or with fine, or with both
2[and where the breach is a continuing one, with a further fine which may extend to two hundred rupees
for every day during which the breach continues after the conviction for the first] and the Court trying
the offence, if it fines the offender, may direct that the whole or any part of the fine realised from him
shall be paid, by way of compensation, to any person who, in its opinion, has been injured by such
breach.
 Under the provisions of Section 30, any person who wilfully discloses any such information as is
referred to in section 21 in contravention of the provisions of that section shall, on complaint made by or
on behalf of the trade union or individual business affected, be punishable with imprisonment for a term
which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
 Any employer who closes down any undertaking without complying with the provisions of section
25FFA shall be punishable under Section 30A with an imprisonment for a term which may extend to six
months, or with fine which may extend to five thousand rupees, or with both.
 Under Section 31, any employer who contravenes the provisions of section 33 shall be punishable with
imprisonment for a term which may extend to six months, or with fine which may extend to one
thousand rupees, or with both. Whoever contravenes any of the provisions of this Act or any rule made
thereunder shall, if no other penalty is elsewhere provided by or under this Act for such contravention,
be punishable with fine which may extend to one hundred rupees.
X) WAGES FOR STRIKES AND LOCK-OUTS

To entitle the workmen to wages for the period of strike, a strike should not only be legal but it should also
not be unjustified. In order to be entitled to wages, the workmen are required to exhaust the normal avenues
for the settlement of dispute as provided under the scheme of the Act before resorting to strike. As regards
payment of wages during strike which is legal and justified, the matter depends upon the propriety of strike,
the manner of conducting the strike and the conduct of the employer. Therefore, a strike which is not
provoked by the high-handed action of the employer would not be justified strike. If the workers do not elect
to have recourse to conciliation before they resort to it in such cases the employer cannot be blamed for the
loss of wages during strike period.

The Supreme Court in the case of Crompton Greaves Ltd. vs. Its Workmen, held that in order to entitle
the workmen to wages for the period of strike, the strike should be legal as well as justified. A strike is legal
if it does not violate any provision of the statute. It can’t be said to be unjustified unless the reasons for it are
entirely perverse or unreasonable. Whether a particular strike was justified or not is a question of fact which
has to be judged in the light of the facts and circumstances in each case.

The use of force or violence or acts of sabotage resorted to by workmen during strike disentitles them to
wages for strike period.

B) LAY-OFF

The Industrial Disputes Act, 1947 contained no provisions for payment of lay-off and retrenchment
compensation to workmen who were laid off or retrenched, under certain contingencies. It all depended
upon the sweet will of an employer to pay compensation to such workers who were ‘laid off’ or ‘retrenched’
on account of temporary closure of business due to economic reasons or otherwise. In order to ameliorate
the conditions of workers, the Act was amended in 1953 and a new Chapter V-A was added in the original
Act.

Section 2(kkk) defines lay-off as the failure, refusal or inability of an employer on account of shortage of
coal, power or raw materials or the accumulation of stocks or the break-down of machinery or natural
calamity or for any other connected reason to give employment to a workman whose name is borne on the
muster rolls of his industrial establishment and who has not been retrenched.
Every workman whose name is borne on the muster rolls of the industrial establishment and who presents
himself for work at the establishment at the time appointed for the purpose during normal working hours on
any day and is not given employment by the employer within two hours of his so presenting himself shall be
deemed to have been laid-off for that day within the meaning of this clause.
Provided that if the workman, instead of being given employment at the commencement of any shift for any
day is asked to present himself for the purpose during the second half of the shift for the day and is given
employment then, he shall be deemed to have been laid-off only for one-half of that day.
Provided further that if he is not given any such employment even after so presenting himself, he shall not
be deemed to have been laid-off for the second half of the shift for the day and shall be entitled to full basic
wages and dearness allowance for that part of the day.

I) RETRENCHMENT
The definition of the term retrenchment as given in Section 2(oo) is exhaustive and comprehensive.
According to the definition, ‘retrenchment’ means 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 superannuation if the contract of employment between
the employer and the workman concerned contains a stipulation in that behalf; or
(bb) termination of the service of the workman as a result of the non-renewal 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
(c) termination of the service of a workman on the ground of continued ill-health.

The Supreme Court in DCM vs. Shambhu Nath, held that the striking off the name of the workman
contrary to the provisions of the Standing Orders amounts to retrenchment as defined in Section 2(oo) and
hence mandatory provisions of Section 25 had to be followed.

In the case of M/s Gammon India Ltd. vs. Sri Niranjan Das, it was held by the Supreme Court that when
services of a senior clerk were terminated due to reduction in the volume of business of the company as a
result of recession in work amounts to ‘retrenchment’ of a worker is invalid, the reinstatement in service is
the proper relief which the court can order.

Retrenchment must be only in a living industry. The other provisions of the Act also such as lock-out, strike,
lay-off, conciliation and adjudication proceedings including retrenchment have meaning only if they refer to
an industry which is running and not to the one which is closed. There can be no retrenchment unless there
is discharge of surplus labour or staff in a continuing or running industry.

II) TRANSFER AND CLOSURE: DEFINITION OF LAY-OFF AND

RETRENCHMENT COMPENSATION
Transfer and closure refer to the process by which an establishment or business entity is moved from one
location to another or closed permanently. The process involves a series of legal and practical considerations
that need to be addressed to ensure that it is executed within the confines of the law.

Lay-off and Retrenchment are terms used to define temporary or permanent termination of the employment
of a worker. The act protects workers against arbitrary termination of employment by their employers.
One such policy is the provision of compensation for layoffs and retrenchments. These are two different
concepts, but they both focus on ensuring that workers are not left without support in case they lose their
jobs.

Section 25C of The Industrial Disputes Act, 1947 deal with the layoff compensation. The IDA provides for
payment of compensation to workers who have been laid off. This compensation is based on the length of
time the employee has been laid off. According to the Act, workers are entitled to receive 50% of their basic
wages and dearness allowance (DA) for the layoff period. It is important to note that the payment of
compensation is only applicable if there is no provision in the employment contract or collective bargaining
agreement that provides for payment of compensation during a layoff. according to Section 25E, A worker is
not eligible to layoff pay if the worker is fired because their actions are causing other employees to work
less efficiently or because of a strike. if the employee misses at least one day each week of the mandatory
working hours at the company. if the employee indicates a desire to decline the alternative employment
offered to him.

In the case of State Bank of India vs. N. Sundaramony and Ors., the Supreme Court in this case held that
employees who have been laid off are entitled to compensation equivalent to 50% of their basic wages and
dearness allowance. However, this compensation is only payable for the first 45 days of layoff. After that,
the employee may be terminated or retrenched.
Under the IDA, if an employer retrenches a worker, they must provide compensation to the worker. The
amount of compensation is based on the length of service of the worker and the basic wage and dearness
allowance received by the worker. If the worker has worked for one year for the employer, they are entitled
to receive 15 days’ wages as compensation.

The landmark decision in Workmen of Hindustan Lever Ltd v. Hindustan Lever Ltd clarified the
principles and guidelines to be followed while providing compensation to the workmen during
Retrenchment. This case dealt with the issue of what constitutes ‘surplus’ employees, and the compensation
that they are entitled to receive. The court held that the employer should consider and apply the ‘last in first
out’ principle while identifying employees for retrenchment. The court further held that the compensation
should be proportionate to the length of service, and the more senior employees should receive better
compensation than the junior employees.

III) COMPENSATION TO WORKMEN IN CASE OF TRANSFER OF

UNDERTAKING CLOSURE

In order to claim lay off compensation, a workman is required to have completed one year continuous
service. Section 25B defines ‘continuous service’ for the purpose of this Chapter of the Act to enable a
workman to claim compensation.

A workman shall be said to be in continuous service for a period if he is, for that period, in uninterrupted
service, including service which may be interrupted on account of sickness or authorised leave or an
accident or a strike which is not illegal, or a lock-out or a cessation of work which is not due to any fault on
the part of the workman;
Where a workman is not in continuous service within the meaning of clause (1) for a period of one year or
six months, he shall be deemed to be in continuous service under an employer:
(a) for a period of one year, if the workman, during a period of twelve calendar months preceding the date
with reference to which calculation is to be made, has actually worked under the employer for not less than:
(i) one hundred and ninety days in the case of a workman employed below ground in a mine; and
(ii) two hundred and forty days, in any other case;
(b) for a period of six months, if the workman, during a period of six calendar months preceding the date
with reference to which calculation is to be made, has actually worked under the employer for not less than:
(i) ninety-five days, in the case of a workman employed below ground in a mine; and
(ii) one hundred and twenty days, in any other case.
For the purposes of clause (2), the number of days on which a workman has actually worked under an
employer shall include the days on which:
(i) he has been laid-off under an agreement or as permitted by standing orders made under the Industrial
Employment (Standing Orders) Act, 1946, or under this Act or under any other law applicable to the
industrial establishment;
(ii) he has been on leave with full wages, earned in the previous years;
(iii) he has been absent due to temporary disablement caused by accident arising out of and in the course
of his employment; and
(iv) in the case of a female, she has been on maternity leave; so, however, that the total period of such
maternity leave does not exceed twelve weeks.

Section 25C of the Act entitles a workman to get compensation from the employer for the period he is laid
off as laying off is an action of the employer and deprives the worker of the opportunity to work and earn
wages. Before a workman becomes entitled to compensation, the following conditions must be satisfied:
(a) His name must be borne on the muster roll and he should not have been retrenched,
(b) He must have completed not less than one year of continuous service, as defined in section 25B, and
(c) The workman must not be a badli or casual workman. An employer is duty bound to maintain muster roll
in such cases under Section 25D of the Act.

Section 25FF provides retrenchment compensation in the case of transfer of undertaking. Before a workman
can claim compensation under Section 25FF, the following conditions must be cumulatively fulfilled:
 (a) There should be a transfer of ownership or management of an undertaking from one employer to
another by an agreement or by operation of law.
(b) Such undertaking must be industry within the meaning of Section 2(j) and the workman claiming
compensation must be a workman within the meaning of Section 2(s).
(c) Such workman should have put in minimum one year of continuous service immediately before such
transfer of management or ownership.
(d) The workman is served with a valid notice.
But a workman will not be entitled to the benefits of Section 25FF in case of change of employer if in such a
case:
(a) the service of the workman has not been interrupted by such transfer,
(b) the terms and conditions of service applicable to the workman after such transfer are not in any way less
favourable to the workman than those applicable to him immediately before the transfer; and
(c) the new employer is, under the terms of such transfer or otherwise, legally liable to pay to the workman,
in the event of his retrenchment, compensation on the basis that his service has been continuous and has not
been interrupted by the transfer.

In case of Board of Directors of South Arcott Electricity Distribution Government Co. Ltd. vs.
Elumalai, an undertaking was acquired by government and consequently employees were taken over by the
new employer, namely the State Government. The conditions of service were less favourable to workmen
under the State Government as compared to the old employer before transfer of the undertaking. The
workman claimed compensation from the company which was engaged in the electricity distribution
business. The claim was disputed by the company. The Supreme Court held that the proviso to Section 25FF
cannot be invoked by the company to defeat the claim made by the workmen under the principal clause of
that section. The right to retrenchment compensation accruing to the workmen under the principal section
was upheld.

Under the provisions of Section 25FFF though termination of services on closure of business may not be
retrenchment, the workmen concerned are entitled to compensation as if, the said termination was
retrenchment and the compensation payable under Section 25FFF without proviso, is substantially the
compensation that is payable under Section 25F of the Act as and by way of retrenchment compensation.

In order to be entitled to compensation, the following conditions should be fulfilled:

(a) The workman should be in continuous service for not less than one year.
(b) The closure of undertaking should be on account of unavoidable circumstances beyond the control of the
employer. Financial difficulties or accumulation of stock are not such unavoidable difficulties or the expiry
of the period of the lease or the license granted when the period of the lease or license expires on or after
1.4.1967 are not such unavoidable circumstances.

In the case of Avon Services (Production Agencies) vs. Industrial Tribunal, Haryana, the Supreme Court
held that the sabotage of a certain work which was part of an undertaking but which could not be classified
as an independent undertaking would not amount to closure of an undertaking. This amounts to
retrenchment and as conditions precedent were not complied with, the retrenchment was invalid and the
relief of reinstatement with back wages was amply deserved.

IV) CLOSURE: PREVENTION AND REGULATION

Closure is a term used to describe the temporary shutdown of a business or organization. The reasons for
closure can vary, but often include financial difficulties, legal issues, or health and safety concerns.

According to Section 2(c) of the Act, “closure” means the permanent closing down of a place of
employment or part thereof.

Preventing closures requires proactive measures to ensure that businesses and organizations remain
financially stable and are able to weather unexpected challenges. This can include measures such as creating
emergency funds, providing financial assistance and incentives to struggling businesses, and offering
training and support to help businesses adapt to changing market conditions.

Regulation is also an important aspect of preventing closures. Governments and regulatory bodies can
establish policies and guidelines to help ensure that businesses and organizations operate in a safe and
responsible manner. This can include requirements for health and safety standards, financial reporting and
transparency, and compliance with local laws and regulations.

Section 25(O) of the Industrial Disputes Act, 1947 provides for the closure of an undertaking or
establishment, without prior permission from the appropriate government authority, if certain conditions are
met. The following are the provisions of Section 25(O):
1. Conditions for closure: An employer can close down an undertaking or establishment without
seeking prior permission from the appropriate government authority, if it has less than 50 workmen,
and the employer pays compensation to the workmen equivalent to 15 days’ average pay for every
completed year of continuous service.
2. Notice to the appropriate government authority: The employer is required to give notice of the
closure to the appropriate government authority at least 60 days in advance, in the prescribed manner.
3. Notice to workmen: The employer is required to give notice of the closure to the workmen at least 60
days in advance, or pay wages in lieu of such notice.
4. Procedure for payment of compensation: The compensation payable to the workmen must be paid at
the time of closure, or within 15 days from the date of notice of closure, whichever is earlier.
5. Penalty for non-compliance: If the employer fails to comply with the provisions of Section 25(O), it
shall be punishable with imprisonment for a term of up to six months, or with a fine of up to Rs.
5,000, or both.

It is important to note that Section 25(O) is applicable only to establishments with less than 50 workmen.
For establishments with 50 or more workmen, prior permission from the appropriate government authority is
required for closure under Section 25(N) of the Industrial Disputes Act.

The following are the procedures for grant and refusal of permission for closure:
Grant of permission: If the government authority is satisfied with the reasons given by the employer for
closure, and if the employer has complied with all the requirements of the Industrial Disputes Act, the
authority may grant permission for the closure. The employer must give notice of the closure to the
government authority and the workmen at least 60 days in advance.

Refusal of permission: If the government authority is not satisfied with the reasons given by the employer
for closure, or if the employer has not complied with the requirements of the Industrial Disputes Act, the
authority may refuse permission for the closure. In such cases, the employer may approach the Labor Court
or the Industrial Tribunal for adjudication. The Labor Court or the Industrial Tribunal may then examine the
reasons for closure and the interests of the workmen, and may either uphold the decision of the government
authority or order the employer to reinstate the workmen with back wages.

If the government authority does not communicate its decision within the specified time, the permission for
closure is deemed to have been granted. The following are the time limits within which the government
authority must communicate its decision:
1. Within 60 days of the receipt of the application for permission, if the establishment has less than 100
workmen on its rolls.
2. Within 90 days of the receipt of the application for permission, if the establishment has 100 or more
workmen on its rolls.

If the government authority fails to communicate its decision within the specified time limit, the permission
for closure is deemed to have been granted. However, it is important to note that the employer must still
comply with the notice and compensation requirements as specified in the Industrial Disputes Act, even if
permission is deemed to have been granted.
V) CONDITIONS: PRECEDENT FOR RETRENCHMENT

Under the provisions of Section 25F certain conditions are laid down which are to be complied with by the
employer before he can exercise the right of retrenchment under the present Act. Following conditions are to
be complied with before a workman is to be retrenched by the employer:
(a) Written notice of one month indicating the reasons for retrenchment should be given to the workman,
(b) The retrenchment cannot be effected before the expiry of the period of notice,
(c) In the alternative the workman should be paid wages for the period of notice,
(d) Compensation equivalent to 15 days’ average pay for every completed year of service or any part thereof
in excess of six months, and
(e) Notice in the manner prescribed should be served on the appropriate government or such authority as
may be specified.

The Supreme Court in Bombay Union of Journalists vs. State of Bombay, held that serving of notice is
not a condition precedent to the making of retrenchment. Non-compliance would amount not to illegality but
an irregularity which can be waived.

Under the provisions of the Act, requirement of paying compensation is mandatory pre-condition for
retrenchment of a workman, non-compliance will render the retrenchment invalid and inoperative and would
attract the penalty as prescribed under Section 31(2) of the Act.

VI) SPECIAL PROVISIONS RELATING TO LAY-OFF, RETRENCHMENT AND

CLOSURE IN CERTAIN ESTABLISHMENTS

Section 25K of the Act provides for the applicability of Chapter V-B. Chapter V-B applies to an industrial
establishment in which more than 100 workmen are employed for the preceding 12 months. The industry
should not be seasonal or intermittent in nature. Any disputes related to the nature of the industry the words
of the appropriate government will be final.

Section 25M establishes the procedure of lay-off. The following are such procedures:
1. Unless the appropriate government or the specified authority by the government (hereinafter;
specified authority) grants permission, no workman whose name is on the muster roll may be laid off.
Lay-offs due to shortage of power or natural calamity and in cases of mines fire, explosion, flood, or
increase of inflammable gas are exceptions to make an application.
2. Copy of application made to the authority in a prescribed manner with specified reasons of lay-off
should be served to the workmen as well.
3. When the employer has laid off workmen without making an application (exceptions to mines,
power cuts, and natural calamities) an application has to be made to the appropriate authority within
30 days of such lay-off.
4. When an application is made asking for permission the appropriate authority shall inquire,
investigate and grant or deny the permission considering all the relevant factors. The reasons for the
decision shall be in writing and served to both the employer and workmen.
5. When such an application is made to the appropriate authority and within 60 days no decision is
communicated to the employer it shall be deemed to have granted the permission.
6. The order passed by the appropriate authority is binding on the employer and the employees and
shall be in force for a year, starting from the day of the order.
7. The order passed by the appropriate authority can review its judgment when an application is made
by the employer or workmen or voluntarily. If the case is referred to a Tribunal. The Tribunal shall
pass the order within 30 days from the day of reference.
8. Lay-offs made without permission or made after denying permission shall be considered illegal and
all the laid-off workmen will be eligible for all benefits as if they were still working.
9. Taking permission from the appropriate authority or applying for such permission can be excepted if
the appropriate Government deems it necessary during the period of accident or death of the owner
or such similar period.
 10. The laid-off workmen under this section will also be entitled to compensation of half of the basic
wage and dearness allowance under Section 25 C provided the workman’s name is on the muster roll
and he has worked for a year.
11. The explanation specified for Section 25M states that when the employer provides an alternative job
for the workmen, it is not considered a lay-off. On the condition that the alternative employment
does not require additional skills or prior experience, the location of the new job remains the same as
before or within a reasonable distance, posing no difficulty for the worker to commute, and the
worker is paid their regular wages for this work.

The constitutionality of Section 25M was contested in Papnasam Labour Union v. Madhura Coats Ltd.,
based on the contention that it imposes unreasonable restrictions as the Section prescribes for prior
permission from the authority. The court held that the imposed restrictions are not arbitrary in nature and
certain exceptions have been laid out under the Section for circumstances like power cuts and natural
calamities where taking permission would not be possible.

Section 25N specifies the conditions precedent to the retrenchment of a workman.

1. A workman who has been employed continuously for a year cannot be retrenched unless (a) a three-
month notice is served in writing along with the reasons for retrenchment and such notice period
should be expired and dues payable to the workman should be clear. (b) Permission has been granted
by the appropriate authority.
2. The employer should make an application to the appropriate authority in the prescribed manner along
with the reasons for retrenchment. A copy of the application should be also served to the employees.
3. When an application is made asking for permission the appropriate authority shall inquire,
investigate and grant or deny the permission considering all the relevant factors. The reasons for the
decision shall be in writing and served to both the employer and workmen.
4. When such an application is made to the appropriate authority and within 60 days no decision is
communicated to the employer it shall be deemed to have granted the permission.
5. The order passed by the appropriate authority is binding on the employer and the employees and
shall be in force for a year, starting from the day of the order.
6. The order passed by the appropriate authority can review its judgment when an application is made
by the employer or workmen or voluntarily. If the case is referred to a Tribunal. The Tribunal shall
pass the order within 30 days from the day of reference.
7. Retrenchment made without permission or made after denying permission by the appropriate
authority shall be considered illegal and all the retrenched workmen will be eligible for all benefits as
if they were still working.
8. Taking permission from the appropriate authority or applying for such permission can be excepted if
the appropriate Government deems it necessary during the period of accident or death of the owner
or such similar period.
9. When permission is granted by the specified authority or is deemed to have granted permission every
workman in the establishment will be entitled to compensation just before the date of applying for
permission. The worker who is retrenched will receive compensation that is equivalent to fifteen
days’ average pay for each year of completed continuous service. If the worker has served for less
than a year but more than six months, the compensation will be prorated based on the portion of the
year served.

In the case of KV Rajendram v. Deputy Commissioner, the division bench of the Madras High Court was
asked to rule on the constitutionality of Sections 25N and 25Q of the Industrial Disputes Act, 1947. The
Court determined that Section 25N and Section 25Q as it relates to the imposition of penalties for violating
the clause in Section 25N were unconstitutional. The Supreme Court’s ruling in Excel Wear v. Union of
India, which deemed Sections 25O and 25R of the IDA to violate the Constitution, served as the foundation
for the court’s reasoning supporting this point of view.

Section 25O provides for the procedure for closing down an undertaking. (already discussed above)
The Supreme Court maintained the constitutionality of Section 25-N in Workmen of Meenakshi Mills Ltd.
v. Meenakshi Mills Ltd. As a result, there had been disagreement among the High Courts on the legality of
Section 25-O. The modified Section 25-O was not deemed to be in violation of the Constitution by the
Supreme Court in the current case, and Article 19(6) of the Constitution preserved it.

Section 25P talks about provisions relating to the reopening of an undertaking that was closed before the
commencement of the Act. The appropriate Government may permit restarting of an undertaking falling
within this Chapter by issuing a public order in the Official Gazette if the following conditions are met.
1. The undertaking was closed due to unavoidable circumstances beyond the control of the employer.
2. There should be a potential of resuming back the undertaking.
3. It is necessary for the rehabilitation of the workmen previously employed or necessary to maintain
the demand and supply of essential commodities.
4. The restarting of the undertaking will not cause undue hardship to the employer.

The industrial establishment should be restarted within one month of the Government publishing grant in the
Official Gazette.

Section 25Q specifies the punishment for laying off and retrenching workmen without permission i.e.,
violation of Section 25M and 25N. The offense shall be subject to a potential penalty of imprisonment for a
period of up to one month, or a fine of up to one thousand rupees, or both.

Section 25R provides a penalty for closing down the undertaking by violating Section 25(O) (failure to
make an application to take permission) as imprisonment which may extend for a period of up to 6 months,
or a fine of up to five thousand rupees, or both. If sub-section (2) of Section 25(O) i.e., closing down the
undertaking after denial of permission and violation of guidelines provided under Section 25P amounts to
imprisonment which may extend to one year or a fine of five thousand rupees or both. If the offense
continues then a fine which may extend to two thousand rupees may be levied for each day of such
contravention.

VII) PROCEDURE FOR RETRENCHMENT AND RE-EMPLOYMENT OF

RETRENCHED WORKMEN AND PENALTY

Section 25G gives legislative recognition to the well recognised principle of retrenchment in industrial law,
namely, ‘first come last go’ or ‘last come first go’. This principle is required to be adhered to by every
employer in an industrial undertaking. The section prescribes certain conditions which must be satisfied
before the workman can claim the above protection which are as follows:
(a) The workman must be workman within the meaning of Section 2(s),
(b) Such a workman should be citizen of India,
(c) Industrial establishment employing such workman should be an industry within the meaning of Section
2(j),
(d) The workman should belong to a particular category of workmen in that industrial establishment, and
(e) There should be no agreement between the employer and the workman contrary to the procedure of “last
come and first go”. The Standing Orders will constitute an agreement for the purpose of this section.

The failure to comply with the principle of ‘last come first go’ or in case of departure, the reasons for such
departure not being recorded, would render the retrenchment invalid. A workman who is improperly
retrenched has a right to reinstatement even if someone has been engaged in his place.

Retrenchment of surplus staff causes undue sufferings not only to the retrenched workman but to all his
dependents. Therefore, in order to avoid hardship to the worker and his family, the provisions have been
made in Section 25H that such workman should be given an opportunity to join service whenever an
occasion arises to employ another hand. This section casts an obligation on the employer to give opportunity
to retrenched workman in such a case and prescribes certain conditions which should be fulfilled by him in
order to claim preference in employment over the other workmen seeking employment under the employer.
In order to claim preference the following conditions be fulfilled by the retrenched workman:
(a) The workman should have been retrenched prior to re-employment (thus dismissed, discharged or
superannuated workman cannot claim preference in employment),
(b) He should be a citizen of India,
(c) The workman should offer himself for re-employment in response to the notice by the employer,
(d) The workman should have been retrenched from the same category of service in the industrial
establishment in which the re-employment is proposed.

In Karnataka State Road Transport Corporation, Bangalore vs. Sheikh Abdul Khader, the services of
some of the employees were terminated either during the initial period of probation or during the extended
period of probation on the ground of unsuitability. The termination of service was held to amount to
retrenchment and retrenched employees were held entitled for compensation. Where the very order of
retrenchment itself if held to be invalid, the employee would continue to be in service and would be entitled
to wages.

C) DISCIPLINARY ACTION AND DOMESTIC ENQUIRY

Domestic Enquiry is generally applicable for an enquiry into alleged indiscipline and misconduct. Domestic
Enquiry is a universally accepted concept that extends to all court and enquiry jobs. It is common for
disciplinary authorities in a department or industry to appoint a competent person as an officer or officers to
inquire into the allegations against an employee. They are commonly referred to as “investigations” and are
also known as domestic enquiries.

Dismissing an employee without a fair and just domestic investigation amounts to a violation of the laws of
natural justice and is mortification to the Labour Courts/Industrial Tribunals. As a result, adverse decisions
or actions will be taken against the contractor.

In addition, the investigating officer cannot punish the employee when he verifies the facts, evidence, and
the Guilty Rules. Only the Supervisor or Approving entity, known as the notified regulatory authority, can
impose the penalty and take appropriate action.

Principles Of Natural Justice

 Nemo in propria causa judex, esse debet
“No one should be made a judge in his own case, or the rules against bias”
 Audi alteram partem
“Hear the other party, or the rule of fair hearing, or the rule that no one should be condemned unheard.

Disciplinary Action
In common parlance, where domestic enquiry ends, disciplinary action begins. Disciplinary action refers to
the measures an employer initiates to address and resolve employee misconduct or performance problems.
Steps may be verbal or written warnings, performance improvement plans, holding wages or salary for a
short period, delay in promotions, suspension, demotion, or termination of employment.

Disciplinary action is a tool in the hands of management to ensure compliance with the rules and regulations
of the organization. It is the source of enforcing the guidelines, rules, regulations, and code of conduct of
employees and dealing with the consequences and penal provisions for non-compliance.

While none of the Statues has laid down any precise procedure for holding a domestic enquiry yet several
important stages of the process of domestic enquiry can be enumerated:
1. Preliminary Enquiry: After a report about the misconduct committed by the delinquent\workman is
received by the employer, he is required to decide whether a prima facie case exists for a formal enquiry.
For this purpose, he may hold a preliminary enquiry of an informal nature. Such an enquiry is purely
informal and does not call for the observance of any specific rules of natural justice and can be held ex-parte
i.e. the workman need not be questioned or otherwise asked to take part in it. Statements taken in the
preliminary enquiry cannot be used as evidence in the formal inquiry. In fact the preliminary enquiry is
intended only for the disciplinary authority to satisfy himself whether departmental action is called for or not.
Hence, there may not be any formal report about the preliminary enquiry and no reference is to be made to it
in the subsequent enquiry.
2. Framing of Charges: This is easily the most important and perhaps, the most crucial stage in the entire
proceedings, because the success of any disciplinary case depends primarily on the soundness of the charges.
The charges are, in turn, based on imputations so that if the imputations or allegations are based on solid
evidence, the chances of successful conclusion of the domestic enquiry are gratefully enhanced.
Unfortunately, gathering of fool proof evidence requires extreme care, patient and laborious work needing
lot of time which is very often grudged. There is little realisation that hurriedly drawn up changes based on
insufficiently gathered information enable the worker to wriggle out of the noose and escape punishment. As
such, time spent in the informal enquiry in building up a sound basis for the charges is time well spent.
Charges should be specific and precise based upon the statement of allegations and ought to be related to the
misconducts specified under the service rules or the certified standing orders applicable to the establishment.
3. Service of Charge-sheet: Once chargesheet is prepared, it is required to be served on the workman
concerned and proof of its service obtained. If the workman is present, service may be affected by personal
service, obtaining acknowledgment of its receipt either on a copy of the chargesheet or in a dak book or on a
separate piece of paper. At the time of service of chargesheet it is advisable (necessary) to have at least two
witnesses, so that in case of refusal to accept chargesheet, the fact is recorded by the person serving the
chargesheet and signature of witnesses obtained. In some companies (and under certain Standing Orders)
there is a good system of reading over and explaining the contents of the chargesheets in the language
understood by the workman concerned, in presence of witnesses. In fact these endorsements are printed on
the copies of chargesheet. In case of illiterate or semi-illiterate workman, this practice is warranted and
should be encouraged.
If the workman is absent or if he has refused to accept the chargesheet, the chargesheet (along with an
endorsement to that effect about its earlier refusal and if necessary with a further chargesheet for `refusal. to
accept Company's communication') is required to be sent to the workman's last known address, by
Registered post with A.D. (It is a good idea to send one copy by ordinary post under certificate of posting, as
well).
4. Reply to the Charge-sheet:
After the chargesheet is received by the workman he may:
i) ask for further details or for inspection of documents referred to in chargesheet,
ii) accept the accusations, plead guilty of the -charges and tender apologies,
iii) may ask for time to submit explanation,
iv) may explain away the accusation and deny the charges,
v) may not submit any explanation.
1. It is advisable to give details if any asked for by employee and also allow him to inspect documents if any
relevant to the charge.
2. If he pleads guilty, in writing, confirmation of such pleading should be obtained in writing in presence of
two witnesses lest the charge of coercion/intimidation is brought against the management.
3. Extension of time for explanation, if prayed for, should be given at. least once as a measure of abundant
caution, depending upon the ground on which such prayer is made.
4. The explanation given should be properly considered and if the same is found satisfactory, management
should promptly withdraw the chargesheet in writing.
5. If explanation is not submitted either a further opportunity suo moto, may be given or enquiry notice may
be issued, with advice for submitting explanation if any, before the commencement of the enquiry.

D) MANAGEMENT’S PREROGATIVE DURING THE PENDENCY OF

PROCEEDINGS

The main purpose of industrial adjudication is to establish industrial peace. This purpose would be defeated
unless the conditions of service of the workmen and their right to continue in employment, as far as possible,
remain unchanged during the pendency of proceedings before authorities under the Industrial Disputes Act,
1947. Sections 33 and 33A have been enacted for the purpose of achieving this object. Section 33 which is
incidentally the largest section provides:
During the pendency of any proceeding before the conciliation, adjudication or arbitration authorities the
employer’s right to make alterations in the conditions of service in regard to matters connected with the
dispute are absolutely prohibited. But there is no restriction at all on alterations with regard to matters
unconnected with the pending dispute.
For misconduct which is connected with the dispute, the employer is required to take the express permission
in writing of the authority before which the proceeding in respect of the dispute is pending, before taking
action against the workmen by way of discharge or dismissal or some other punishment for the misconduct.
For misconduct which is unconnected with the pending dispute such permission is not required and the
employer may discharge or dismiss or otherwise punish the workmen for such misconduct provided that the
employer must pay the workmen one month’s wages and apply to the, authority for approval of the action
taken by him. The dispute must be adjudicated upon within three months from the date of receipt of such
application.
In the case of a protected workman, whether the misconduct committed by him, is or is not connected with
the dispute, the employer must in every case obtain, the express permission in writing of the Authority
before which the proceeding is pending before taking any action against him by way of discharge or
dismissal or some other punishment. Section 33(4) provides for the maximum and minimum number of
workmen to be recognised as “protected workmen” in every establishment.

Section 33A provides that when the employer has taken any action in contravention of the provisions of
Section 33 during the pendency of any proceeding before an authority under the Act, the employee
aggrieved by such contravention may make a complaint in writing to the authority concerned, and on receipt
of such a complaint, the authority shall adjudicate upon the complaint as if it were a dispute referred for
adjudication under Section 10(1) and shall make an award thereon. The provisions of the Act as to
submission, publication and operation of awards shall apply to an award made by the authority concerned
under Section 33A, as if it was an award made under a reference for adjudication under Section 10(1) o f the
Act.

E) NOTICE OF CHANGE

Under the Industrial Disputes Act, 1947, Section 9A deals with the procedure for making changes to the
terms of service for workers in any industrial establishment. This section is crucial in maintaining industrial
harmony and ensuring that employees are not subjected to abrupt changes in their employment conditions.

Employers are required to provide a 21-day notice to the employees before implementing any changes in the
conditions of service. This notice must specify the nature of the proposed changes and be displayed
conspicuously in the workplace where it can be easily seen by the employees affected.

The changes requiring notice under this section include alterations in wages, working hours, leave policies,
job roles, and other significant terms of employment. The schedule to the Act (Fourth Schedule) lists the
specific matters that require such notice.

The purpose of Section 9A is to prevent sudden and unilateral changes by the employer that could adversely
affect the workers. It ensures that employees have adequate time to consider the proposed changes and raise
any concerns or objections they may have.

If an employer fails to provide the mandatory notice, any changes made may be deemed invalid, and the
employer could face legal consequences. The employees may also raise an industrial dispute if they are
adversely affected by such changes without proper notice.

The requirement of notice under Section 9A does not apply in cases where the changes are a result of a
settlement or an award, or if the terms of employment explicitly provide for such changes.
Section 9A is significant as it promotes transparency and fairness in the employer-employee relationship. By
mandating prior notice for changes in service conditions, it provides employees with an opportunity to
understand, discuss, and prepare for the changes, thereby fostering a more stable and cooperative work
environment. This provision helps in preventing industrial unrest and ensures that any modifications in
employment terms are carried out with due consideration to the workers' rights and well-being.