Trade Unions Act 1926

Trade Unions Act: The trade unions act was passed before independence to provide legal protection to employee’ collectives and regulate them. Under the act, trade unions are to be registered with the appropriate government appointed Registrar of Trade Unions.

Maintaining smooth relations between management and labor has been one of the main objectives of Indian Industrial relations. Laws falling under this domain are mainly regulative in nature. They specify the dos and don’ts.

The Trade Unions Act, 1926 allows freedom for any seven employees to apply to register a trade union, but a later amendment (2001) specified the minimum membership as 10% of unionizable employees or 100 employees, which ever is less. The act does not make registration compulsory. However, the registered trade union protection from certain civil and criminal actions.

The act does not specify any criterion or method for recognition of trade union by the employer as the representative of employees. Various state governments, like Maharasthra, have enacted separate legislations to deal with recognition.

The Industrial Employment (Standing Orders) Act, 1946 is regulatory in nature and is applicable to industrial establishments under the jurisdiction of central and state governments. By formally defining conditions of employment, the act serves to reduce conflict and also be a communication mechanism between management and labor.

Industrial establishments have to frame standing orders and apply for certifications for those as well. Certifications will be done by designated certifying officer after inviting objections from workmen or trade unions and considering the objections. In the absence of certified standing orders, the model standing orders provided in the act automatically apply, except in Gujarat and Maharasthra.

The primary tone of the Industrial Disputes (ID) Act of 1947 is regulatory since it puts restrictions on the direct actions that can be taken by both the parties involved in the industrial dispute. Different conflict resolution forums have been proposed, including works committees (Section 3), conciliation officers (Section 4) boards of conciliation (Section 5) courts of inquiry (Section 6) and labor courts (Section 7) tribunals (Section 7A) and the national tribunal (Section 7B). The act also allows the government to intervene in the interest of maintaining industrial peace. Since it came to force, the act has been amended many times.

In the context of demand for labor reforms, the suitability of the different provisions of the act has been questioned from the perspective of increasing employment productivity, and flexibility. The debate on the ID act starts with the definition of the industry itself, which got widened by the Supreme Court in the landmark Bangalore Water Supply and Sewage Board v. Rajappa, (1978) case.

The act also requires organizations to give a notice of change (Section 9A) – and advance notice of 21 days – if there is any change at the work place affecting the workers. However Section 9B allows the government to exempt firms from Section 9 A in terms of public interest. Section 10 gives the government power to refer industrial disputes to boards, courts or tribunals for the purpose of arriving at a settlement.

The act also places restrictions on employees in public utilities going on strike (sections 22, 23, and 24) without appropriate notice (6 weeks and 14 days before giving the notice) or when any conciliation effort is operational. It also has provisions for firms employing more than 50 workmen (Section 25 A) regarding layoffs, payment of layoff compensation (Section 25 C) retrenchment of workmen after giving sufficient notice (Section 25F) and for closure of undertaking (section 25 FFA).

Laws Related to Wages:

The Payment of wages act of 1936 has the objective of ensuring payment of wages to certain groups or employees, at regular intervals and without any unauthorized deductions. The act also provides relief to the group of employees in case of non-payment of wages on time (Section 5) or of unauthorized deductions are made (Section 7

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