Industrial Dispute Act 1947

Dispute Reasons Effect Consequences

1.Employer Vs employee 1.Working 1.Relationship Er- 1. Lay- off

2.Employer Vs employer 2.Working hours 2.Stiff 2. Retrench

3.Employee Vs employee 3.Working Conditions 3.Bad 3. lock out

4.Wages 4.Hamper 4. Closure of Business

5.Amount of wages 5.Bad Affect on: Ee-1. Sticks

6.Payments are not in time 6.Ee, Er, Industry, 2. Damage of properties

7.Compensation State,Country

8.lay-off no work go

9.Retrenchment

10.Accidents
 Industrial Dispute Act 1947
History

1.Employer and workmen Dispute Act 1860

2.Very much against the labour

3.Trade Dispute Act 1929

4.Special provisions regarding Strikes

5.During 2nd world war Rule 81-A of defence of India for ben Strikes Dispute should be

compulsorily refer to conciliation or arbitration (mediator)

6.After 2nd world war rule 81-A lapse on 1st oct 1946

7.Finally Industrial dispute Act came in to the picture

 Industrial Dispute Act 1947
Applicability
It is extends to whole of India (Including J & K)
It is applicable to existing industries not to dead industry
Applicable on industry hold by central government and State Government

Industry
Bangalore water supply and Sewage Board V/S A Rajappa
A systematic activity
Organized by cooperation between Employer and workman
Production, Supply, Distribution of goods and services
1. Whether or not capital invested.
2. Profit motive is there or not
Includes-
a.Activity of duck labour board.
b.Activity related to promotion or sale related to business
 Industrial Dispute Act 1947
Excludes
Agriculture operations (Agriculture sugarcane and sugar making industry)
Hospital and dispensary (MR)
Education institutions ( Research or Scientific institution , imparting education)
Social and charitable institutions (not for profit)
Khadi and rural industry (Khadi and rural industry Act )
Sovereign function
Domestic services
Profession (Less then 10 workers working )
Activity done by Co-oprative socity
Above disputes will not be considered in Industrial Dispute Act
# But these are not considered as an industry (Case law based)—Excludes from Industries
Post and telegram department
Telecom Department
Central institute of fisharies
Constructio and maintainance of National Hoghway
Trade Union
 Industrial Dispute Act 1947
Dispute b/w
Er & Ee
Er & Er
Ee & Ee
Regards to-
Employment and non employment
Terms of employment
Working conditions

Dispute will be considered only when same has been raised by Ee to Er

Mare demand to Appropriate G without dipute being rasied can not be treated as
industrial dispute (It will not considered as ID and remedies will not be taken)

Who can raise

Collective dispute not raised by single workmen (He should be back up)
Exceptions: Discharge , dismisse , retrenchment
There should be community of intrest
• STRIKES AND LOCKOUTS 

Strike [Sec. 2 (q)]: Strike means "a cessation (Stop) of work by a body of persons
(Workmen) employed in any industry acting in combination or a concerted 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". Mere stoppage of
work does not come within the meaning of strike unless it can be shown that such
stoppage of work was a concerted action for the enforcement of an industrial
demand. 

Lockout [Sec. 2(1)]: Lockout 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". Lockout is the
antithesis of strike. 
• It is a weapon of the employer while strike is that of the workers.
• Just as a strike is a weapon in the hands of the workers for enforcing their
industrial demands, lockout is a weapon available to the employer to force the
employees to see his points of view and to accept his demands.
• The Industrial Dispute Act does not intend to take away these rights.
• However, the rights of strikes and lockouts have been restricted to achieve the
purpose of the Act, namely peaceful investigation and settlement of the industrial
disputes.
 Industrial Dispute Act 1947
Employee or workman
Any person employed to do
Manual
Skilled or unskilled
Technical / clerical
Operational / supervisory
Does not includes-
Person employed mealy Managerial or Administrative capacity
Supervisory capacity drawing exceeding 10,000/-
Person who are subject to special act Army, Air force, Navy
 INTRODUCTION
• Industrial Disputes have adverse effects on industrial
production, efficiency, costs, quality, human
satisfaction, discipline, technological and economic
progress and finally on the welfare of the society. A
discontent labour force, nursing in its heart mute
grievances and resentments, cannot be efficient and
will not possess a high degree of industrial morale.
Hence, the Industrial Dispute Act of 1947, was
passed as a preventive and curative measure.
 SCOPE AND OBJECT
• The Industrial Dispute Act of 1947, came into force
on the first day of April, 1947.
• Its aim is to protect the workmen against
victimization by the employers.
• To ensure social justice.
• The unique object of the Act is to promote collective
bargaining and to maintain a peaceful atmosphere in
industries by avoiding illegal strikes and lock outs.
• The Act also provides for regulation of lay off and
retrenchment.
Conti…

• The objective of the Industrial Disputes Act is to

secure industrial peace and harmony
• To provide mechanism and procedure for the
investigation and settlement of industrial disputes by
negotiations.
• This act deals with the retrenchment process of the
employees, procedure for layoff, procedure and rules
for strikes and lockouts of the company.
 DEFINITIONS
• Appropriate Government [Sec. 2(a)]:
• Appropriate Government means
• - the Central Government in relation to any industrial dispute concerning
any industry carried on by or under the authority of the Central
Government, or
• any industry carried on by a Railway Company, or
• any controlled industry specified by the Central Government,
• The Unit Trust of India.
• Corporations under the Central Statutes,
• Banking company, Insurance company.
• Mines.
• Oil field,
• Cantonment board, Major ports, etc.
• In relation to any other industrial dispute, the appropriate Government is
the State Government.
Award [Sec 2 (b)] means an interim or a final determination of any industrial dispute or
of any question relating thereto by any
• Labour Court,
• Industrial Tribunal or
• National Industrial Tribunal and
• includes an arbitration award made under section 10A;
•  
Industry [Sec. 2(j)]: Industry means any
• business,
• trade,
• undertaking, manufacture or
• service, employment, handicraft or industrial occupation or avocation of workmen.

Industrial Dispute [Sec. 2(k)]: means any dispute or difference between

• employers and employers, or
• between employers and workmen, or
• between workmen and workmen,
• which is connected with the employment or non-employment or the terms of
employment or with the conditions of labour, of any person.
• Settlement [Sec. 2(p)]:
• Settlement means a settlement arrived at in the course of conciliation proceeding and
includes
• a written agreement between an employer and a workman arrived at otherwise than in the
course of conciliation proceeding where such agreement has been signed by the parties
thereto in such manner as may be prescribed and a copy thereof has been sent to an officer
authorised by the Appropriate Government and the Conciliation Officer.

• Wages [Sec. 2(rr)]: Wages mean all remuneration capable of being expressed in terms of
money, which would, if the terms of employment, express or implied were fulfilled, be
payable to a workman in respect of his employment or of the work done in such an
employment and includes:
• (i) such allowances (including dearness allowance) as the workman is for the time being
entitled to;
• (ii) the value of any house accommodation, or of supply of light, water, medical attendance
or other amenity or of any service or of any concessional supply of food grains or other
articles;
• (iii) Any traveling concession. But the following are excluded:
• (a) Any bonus.
• (b) Any contribution paid or payable to any pension fund or provident fund, or for the
benefit of the workman under any law for the time being in force.
• (c) Any gratuity payable on the termination of his service.
 DISPUTE SETTLEMENT AUTHORITIES
UNDER THE ACT
The I.D. Act provides elaborate and effective machinery for the
investigation and amicable settlement of industrial disputes by setting
up the various authorities. These are: 

• Works Committee;
• Conciliation Officer;
• Conciliation Board;
• Court of Enquiry;
• Labour Court;
• Industrial Tribunal;
• National Tribunal;
• Arbitrators;
• Grievances Settlement Authority.
 WORKS COMMITTEE [Sec. 3]:
In the case of an industrial establishment in which
• 100 or more workmen are employed, the appropriate
Government may require the employer to constitute a 'Work
Committee'.
• It consists of equal number of representatives of employers
and workmen engaged in the establishment.
• The representatives of the workmen shall be chosen from
amongst the workmen engaged in the establishment and in
consultation with the registered trade union, if any.
• Works committee deals with the workers problem arising day
to day in the industrial establishment. 
 CONCILIATION OFFICER [Sec. 4]: 
• The appropriate Government is empowered to appoint any
number of persons, as it thinks fit, to be conciliation officers.
• The conciliation officer having duty of mediating and acts as
the mediators in between the parties to resolve the dispute. 

In the case of public utility services matters like strikes and

lockouts the conciliation officer can initiate the conciliation
proceeding to settle the dispute in between the parties. 

If the conciliation officer fails to resolve the dispute between

the parties, he should report to the appropriate government.
If necessary the dispute shall be referred to the Board, Labour
Court, Tribunal or National Tribunal, by the appropriate
government. [Sec 12 (5)] 
Duties of conciliation officers. [Sec 12] 
• Hold conciliation proceedings relating to Strikes and lockouts procedural
matters of public utility services.
• Investigate the matters of the disputes.
• Conciliation officers shall induce the parties to come to a fair and amicable
(Friendly) settlement of the dispute.
• Duty to send the report of settlement of dispute and memorandum of the
settlement signed by the parties to the dispute to the government or his
superior.
• In case of failure of settlement of dispute in between parties, duty to send
them to the government or his superior, report of facts and circumstances
relating to the disputes and in his opinion, a settlement could not be
arrived at,
• Duty to send the report to the government or his superior within 14 days
from the commencement of the proceeding. or within such shorter period
as may be fixed by the appropriate Government .
CONCILIATION BOARD [Sec. 5]: 
• Appropriate Government is also authorised to constitute a Board of
conciliation for promoting the settlement of an industrial dispute.
• It consists of a chairman who shall be an independent person, and two or
four other members.
• The members appointed shall be in equal numbers to represent the parties
to the dispute.
• On the dispute being referred to the Board it is the duty of the Board to do
all things as it thinks fit for the purpose of inducing the parties to come to
fair and amicable settlement. 

If there are many parties relating to or in the dispute the government may
appoint the conciliation board consisting of the above said members 

According to [Sec 10 (2)] when parties in the industrial dispute apply to the

government to refer dispute to the Conciliation Board and if government
satisfies it shall make the reference to the Conciliation Board. 
 Duties of board. [Sec 13] 
• it shall be the duty of the Board to endeavor to bring about a
settlement of dispute.
• Investigate the matters relating to the dispute between
parties and inducing the parties to come to a fair and
amicable settlement of the dispute.
• In case of failure of settlement of dispute in between parties,
duty to send to the government the report of facts and
circumstances relating to the disputes and board opinion, a
settlement could not be arrived at,
• The Board shall submit its report under this section within 2
months of the date on which the dispute was referred to it or
within such shorter period as may be fixed by the appropriate
Government.
COURT OF ENQUIRY [Sec. 6]: 
• Government can initiate a Court of Inquiry.
• This Court of Inquiry was to find out matters connected with or
relevant to an industrial dispute. Where a Court consists of two
or more members, one of them shall be appointed as the
chairman. 
A Court of Inquiry looks into only matters which are referred to
it by Government and submits its report to the Government
ordinarily within certain period from the date of reference. 

ADJUDICATION 
Labour Court [Sec. 7]: The appropriate Government is empowered
to constitute one or more Labour Courts. Its function is the
adjudication of industrial disputes relating to any matter
specified in the Second Schedule (II Schedule). 
Industrial Tribunal [Sec. 7A]: 
• The appropriate Government may, by notification in the
Official Gazette, constitute one or more Industrial Tribunals
for the adjudication of industrial disputes relating to any
matter, whether specified in the Second Schedule (II
Schedule) or the Third Schedule (III Schedule) and for
performing such other functions as may be assigned to them
under this Act. 

National Tribunal [Sec. 7 (B)]: 

 
• The Central Government may, by notification in the Official
Gazette, constitute one or more National Industrial Tribunals.
• Its main function is the adjudication of industrial disputes
which involve questions of national importance or affecting
the interest of two or more States. 
• The Central Government shall appoint a National Tribunal
consisting of one person only. 
• A person to be appointed a presiding officer of a National
Tribunal must be, or
• must have been, a judge of a High Court or
• must have held the office of the chairman or
• any other member of the Labour Appellate Tribunal for a
period of not less than two years.
• The Central Government may appoint two persons as
assessors to advise the National Tribunal. 
 ARBITRATION 
Voluntary reference of disputes to arbitration. [sec. 10 (a)]: 
• An arbitrator is appointed by the Government.
• Whether the dispute is before Labour Court, or Industrial Tribunal or National Tribunal,
the parties can go to arbitration by written agreement.
• The arbitrators conduct the investigation in to the dispute matters and give arbitration
award (final decision or settlement or decree) as for making reference of an industrial
dispute.
• If an industrial dispute exists or is apprehended and the employer and the workman agree
to refer the dispute to an arbitration, they may refer the dispute to an arbitration.
•  
• But such reference shall be made before the dispute has been referred under Sec. 19 to a
Labour Court or Tribunal or National Tribunal by a written agreement.
• The arbitrator may be appointed singly or more than one in number.
• The arbitrator or arbitrators shall investigate the dispute and submit to the appropriate
Government the arbitration award signed by the arbitrator or all the arbitrators, as the
case may be. 
 Grievance Settlement Authority
[Sec. 9 (c)]: 
• This Section is incorporated as a new chapter II B of the Act.
• As per this Section, the employer in relation to every industrial
establishment in which 50 (fifty) or more workmen are employed
or have been employed on any day in the preceding twelve
months, shall provide for, in accordance with the rules made in
that behalf under this Act, a Grievances Settlement Authority. 

9C. every industrial establishment employing 20 or more

workmen shall have one or more Grievance Redressal Committee
for the resolution of disputes arising out of individual grievances. 
• The Grievance Redressal Committee shall consist of equal
number of members from the employer and the workmen.
• The chairperson of the Grievance Redressal Committee shall be
selected from the employer and from among the workmen
alternatively on rotation basis every year.
• The total number of members of the Grievance Redressal
Committee shall not exceed more than 6. One woman member if
the Grievance Redressal Committee has two members and in case
the number of members is more than two, the number of women
members may be increased proportionately.
• The Grievance Redressal Committee may complete its proceedings
within 45 (forty-five) days on receipt of a written application by or
on behalf of the aggrieved party.
• The workman who is aggrieved of the decision of the Grievance
Redressal Committee may prefer an appeal to the employer against
the decision of Grievance Redressal Committee and the employer
shall, within one month from the date of receipt of such appeal,
dispose off the same and send a copy of his decision to the
workman concerned.
 AWARDS (decree) [Secs 16, 17, 17A] 
• The award of a Labour Court or Tribunal or National Tribunal
shall be in writing and shall be signed by its presiding officer.
• Every arbitration award and every award of a Labour Court,
Tribunal or National Tribunal shall, within a period of 30 days
from the date of its receipt by the appropriate Government,
be published in such manner as the appropriate Government
thinks fit.
• The award published shall be final.
• An award (including an arbitration award) shall become
enforceable on the expiry of thirty days from the date of its
publication
 PROCEDURE OF STRIKES 
According to Sec. 22(1) 
Worker should follow the rules mentioned below for doing strike.
The rules are as follows 

• (a) Issue of notice of strike is mandatory; 

(b) The date of strike must be within 6 weeks from the date of
issue of strike notice; 
(c) The day of strike must not be within 14 days from the date
of notice; 
(d) There should be no strike on any day before the date
specified in the strike notice; 
(e) There should be no strike during the pendency of
conciliation proceedings and 7 days after the conclusion of
said proceedings; 
 PROCEDURE OF LOCKOUTS
According to Sec. 22(1) 
Worker should follow the rules mentioned below for doing Lockouts. The rules are as
follows 

• (a) Issue of notice of lockout is mandatory; 

(b) The date of lockout must be within 6 weeks from the date of issue of strike
notice; 
(c) The day of lockout must not be within 14 days from the date of notice; 
(d) There should be no lockout on any day before the date specified in the strike
notice; 
(e) There should be no lockout during the pendency of conciliation proceedings
and 7 days after the conclusion of said proceedings; 
•
According to Sec. 22 (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, 
 ILLEGAL STRIKES AND LOCK-OUTS [Sec 24] 
A strike or a lockout shall be illegal, if employers or worker who ever disobeys or fails to
follow the rules [Sec 22, 23, 10(3), 10-A (4-A)] for commencing strikes or lockout, those
strikes and lockout are said to illegal. 

General Prohibition of Strike, and Lockouts [Sec. 23]: 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 in the following circumstances. 
(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; 

(c) during the period of operation of a Settlement or Award in respect of any of the
matters covered by the Settlement or Award. 
No notice of strike and lockout is necessary in industrial establishments except in public
utility services. 
 Difference b/w Strike & Lockout
Strike lockout
Workers shall do the strike. Employer or owner shall do the lockout.
Workers do the strike because of the Owners do the Lockout because of the
grievance and for its solution. disputes between owners and workers.
Prior notice should be given by the worker Prior notice should be given by the owner
to the owner of the factory. of the factory to the worker.

Threat to go on strike:- in State of Bihar v. deodhar Jha (All India Reporter

1958 Patna. 51), the Patna High Court examine the point as to whether or not
threat go on strike is illegal. the court said that the actual resorting to strike
cannot always be illegal, therefore threat to go strike is not illegal. 
 LAY-OFF AND RETRENCHMENT 
Lay-off [Sec. 2(kkk)]: Lay-off means "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
breakdown of machinery or for any other 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". 

Retrenchment [Sec. 2(oo)]: Retrenchment means the

termination by the employer of the service of a workman for
any reason whatsoever otherwise than as a punishment
indicated by way of disciplinary action. 
 RIGHTS OF WORKMAN LAID OFF
•
FOR COMPENSATION [Sec. 25C] 
A workman who is laid off is entitled to compensation only if he complies with the following
conditions: 
• (i) He must not be a badli or a casual workman. 

"Badli workman" means a workman who is employed in an industrial establishment in the

place of another workman whose name is borne on the muster rolls of the establishment, 

(ii) His name must be borne on the muster rolls of the industrial establishment. 

(iii) He must have completed at least 1(one) year of continuous service. 

(iv) A worker is entitled to lay-off compensation for the period of his lay off other than for
weekly holidays which may intervene. 

(v) The rate of compensation must be equal to 50% of the total of the basic wage and
dearness allowance that might have been payable to him. 

(vi) No compensation can be claimed for more than forty-five days during the period of
twelve months. 
 WORKMEN LAID OFF NOT ENTITLED TO
COMPENSATION [Sec. 25E] 
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 or any other establishment belonging to the same
employer situated in the same town or village or within a
radius of five miles and it does not require any special skill or
previous experience, provided the same wages are offered, 
(ii) if he does not present himself for work at the appointed
time during normal working hours at least once a day, 
(iii) if lay off in the consequence of strike or slowing down of
production by the workers in another part of the
establishment.
 DIFFERENCE BETWEEN THE LAY-
OFF AND LAID- OFF

Laid-off Lay-off
A person who is temporarily removed for Temporary stoppage of the running
the work being attended factory by the owner of the establishment
or factory.
A company which declares lay-off, Lay-off is implemented due to shortage
worker/ workers shall be laid-off from the of the raw material, break-down of
work machinery etc.
The laid-off compensation shall be After 45 days of lay-off, management
payable to worker for 45 day only can retrench worker.
 CLOSE DOWN ANY UNDERTAKING [Sec 25FFA] 
• An employer who intends to close down an undertaking shall
serve, at least 60 days before the date on which the intended
closure.
• a notice, is required to give to the appropriate Government
stating clearly the reasons for the intended closure of the
undertaking.
• Provided that nothing in this section shall apply to – 
• An undertaking in which less than 50 workmen are employed,
or less than 50 workmen were employed on an average per
working day in the preceding twelve months. An undertaking
set up for the construction of buildings, bridges, roads, canals,
dams or for other construction work or project. 
 RETRENCHMENT OF WORKER
Section. 25C  
If lay-off exceeds 45 days only the management or owner can retrench
the workers by following below said rules. 
•
The reason for compelling and restricting 45 days period of lay-off
before doing retrenchment of employee is.
lay-off is considered to be a unique situation created by reasons beyond
the control of employer, it is supposed to be a temporary situation
contingent on the grounds mentioned in the definition of layoffs in the
section 2(kkk). However if this contingency is prolonging beyond a
reasonable time, say 45 days, it will be matter of serious concern both to
the employer and to employees because both of them put to a loss of
50% wages by employees and loss of earnings by employer due to
temporary stoppage of work, which employer would have earned if there
was no laid-off for the reasons mentioned in section 2 (kkk).
• In the case if an employer is not able to restore the situation which
compelled him to lay off  employees, he can retrench employees after the
expiry of 40 days in stuff continuing layoffs.
Procedure for retrenchment [Sec. 25G] 
LIFO (Last in First Out) method should be followed while retrenchment of
workers, a workers who has joined last shall be retrenched first. Further
explanation junior should be retrenched first. 

Conditions precedent to retrenchment of workmen [Sec. 25F] 

Worker who has completed one year of service and continuing in service
must be retrenched by the owner by following rules. 
• One month notice of retrenchment should be given to the worker by the
owner.
• Notice should include the reasons for the retrenchment of the concerned
worker.
Retrenchment Compensation [Sec
25F (b)] 
Retrenchment worker can claim compensation from the worker under
following procedure 
• 15 days of salary drawn for every year of service completed
• Eg: last drawn salary of worker = 10000/- 

Number of years of service = 5 years 

So, retrenchment compensation calculated as follows 

Salary drawn is = 10000/- , for 15 days salary is half of the amount =

5000/- × number of service years = 5. = 25000/- is the retrenchment
compensation. 
 PENALTIES
Sec Reasons Punishment
25U unfair labour practice punishable with imprisonment for a term
which may extend to 6 months or with
fine which may extend to 1000/- rupees
or with both.
26 Illegal Strikes punishable with imprisonment for a term
which may extend to one month, or with
fine which may extend to 50/- rupees, or
with both.
26 Illegal Lock-Outs punishable with imprisonment for a term
which may extend to one month, or with
fine which may extend to one 1000/-
rupees, or with both.
27 Any person who instigates or punishable with imprisonment for a term
incites others to take part in, or which may extend to 6 months, or with
otherwise acts in furtherance of, a fine which may extend to one 1000/-
strike or lock-out which is illegal rupees, or with both.
under this Act,
28 Giving Financial Aid To Illegal punishable with imprisonment for a term
Strikes And Lock-Outs which may extend to 6 months, or with
fine which may extend to 1000/- rupees,
or with both.
30 Disclosing Confidential Punishable with imprisonment for a term
Information which may extend to 6 months, or with
fine which may extend to 1000/- rupees,
or with both.
30A Closure of establishment Without punishable with imprisonment for a term
Notice which may extend to 6 months, or with
fine which may extend to 5000/- rupees,
or with both.
31 contravenes the provisions of Punishable with imprisonment for a term
section 33 which may extend to 6 months, or with
fine which may extend to 1000/- rupees,
or with both.