Unit 3 — Exam Guide

1. Definition — Section 2(q)

Section 2(q) defines Strike as 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 to continue to work or to accept employment.

2. Essential Elements

• Cessation of work — workers must actually stop working
• Body of persons — not by a single individual
• Employed in any industry — must be in an ‘industry’
• Acting in combination — collective action, not individual
• May be temporary or permanent

3. Forms of Strike

• General Strike — all workers in an industry stop work
• Go-slow — workers deliberately reduce pace of work
• Sit-down / Stay-in Strike — workers remain at workplace but refuse to work
• Work-to-rule — workers strictly follow every rule, causing delays
• Pen-down Strike — workers stop writing/clerical work
• Sympathy Strike — workers strike to support another group’s dispute

4. When Strike is Illegal

A. In Public Utility Services — Section 22(1)

A strike is illegal if:

• Workers go on strike without giving 14 days’ notice to the employer
• Strike before the expiry of the notice period
• Strike during conciliation proceedings and 7 days after conclusion

B. In Non-Public Utility Services — Section 23

A strike is illegal if commenced:

• During conciliation/board/tribunal proceedings
• Within 7 days after conclusion of such proceedings

C. General Prohibition — Section 24

A strike is illegal if:

• It is in contravention of S.22 or S.23
• It is in contravention of an order of a Tribunal
• It is continued after the dispute has been referred to adjudication

5. When Strike is NOT Illegal

• Strike in response to an illegal lock-out is not illegal
• Strike after following all procedural requirements
• Strike after expiry of notice period in public utility service

6. Consequences / Penalties — Section 26

• Participating in an illegal strike: imprisonment up to 1 month or fine up to Rs. 50 or both
• Instigating/inciting an illegal strike: imprisonment up to 6 months or fine up to Rs. 1,000 or both

7. Case Laws

T.K. Rangarajan v. State of Tamil Nadu (2003) — The Supreme Court held that government employees have no right to strike. Strike is not a fundamental right, though forming unions is.

Crompton Greaves v. Workmen — Go-slow is a more serious form of strike as it disrupts production without a clear stoppage.

1. Definition — Section 2(oo)

Section 2(oo) defines Retrenchment as 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.

Exclusions from Retrenchment

• Voluntary retirement of the workman
• Retirement on reaching the age of superannuation
• Termination due to continued ill-health
• Termination on expiry of the contract of employment
• Termination under a stipulation in the contract

2. Conditions Precedent — Section 25F

Section 25F lays down 3 mandatory conditions that must be fulfilled before retrenchment:

1. Notice: 1 month written notice to the workman indicating the reasons, OR wages in lieu of notice
2. Compensation: 15 days’ average pay for every completed year of continuous service (or part thereof exceeding 6 months)
3. Government Notice: Notice in the prescribed manner to the appropriate government

Compensation Formula: 15 days × average pay × years of service

3. Last Come First Go Rule — Section 25G

Section 25G provides the Last Come First Go principle:

• Where retrenchment becomes necessary, the employer shall ordinarily retrench the workman who was the last person to be employed in that category
• Unless the employer has a valid reason for departing from this rule
• The reason must be recorded in writing
• This rule ensures fairness and prevents discrimination

4. Re-employment — Section 25H

Section 25H provides that retrenched workmen shall be given preference in re-employment if the employer proposes to employ new workers in the same category.

• Employer must give notice of the vacancy to retrenched workmen
• Retrenched workers have priority over new recruits
• This right continues until the worker gets alternative employment

5. Special Provisions for Large Establishments — Section 25N

Section 25N applies to establishments with 100 or more workmen:

• Employer must obtain prior permission from the appropriate government
• 3 months notice to government
• Government may grant or refuse permission after inquiry
• Retrenchment without permission is void

6. Case Laws

State Bank of India v. Sundara Money — Retrenchment without complying with S.25F is void ab initio. The workman is entitled to reinstatement.

Firestone Tyre v. Management — Confirmed that all three conditions under S.25F are mandatory and must be complied with strictly.

1. Lock-out — Section 2(l)

• Definition: Temporary closing of a place of employment, or suspension of work, or refusal by an employer to continue to employ
• Nature: Employer’s weapon — counterpart of strike
• Purpose: To pressurise workers during a trade dispute
• Duration: Temporary
• Compensation: No compensation if lock-out is legal
• Relationship: Employment relationship continues
• Illegality: Same rules as strike (S.22, S.23, S.24)

2. Lay-off — Section 2(kkk)

• Definition: Failure, refusal, or inability of an employer to give employment to a workman whose name is on the muster roll
• Reason: Shortage of coal, power, raw materials, breakdown of machinery, natural calamity, or other connected reasons
• Duration: Temporary
• Compensation: 50% of basic wages + DA for up to 45 days (S.25C)
• Relationship: Employment relationship continues
• Worker status: Worker’s name remains on muster roll

3. Retrenchment — Section 2(oo)

• Definition: Termination of service of a workman for any reason (except disciplinary action, retirement, ill-health, contract expiry)
• Nature: Permanent termination of employment
• Compensation: 15 days’ pay per year of service (S.25F)
• Conditions: 1 month notice + compensation + govt notice
• Rule: Last Come First Go (S.25G)
• Relationship: Employment relationship ends

4. Closure — Section 2(cc)

• Definition: Permanent closing down of a place of employment or part thereof
• Nature: Permanent shutdown of the entire establishment
• Scope: ALL workers are affected (unlike retrenchment which is selective)
• Notice: 60 days’ notice to the appropriate government (S.25FFA)
• Permission: Prior permission required for establishments with 100+ workers (S.25O)
• Compensation: Same as retrenchment (15 days per year)

5. Comparison Table

1. Introduction

The Industrial Employment (Standing Orders) Act, 1946 requires employers to clearly define the conditions of employment. Standing Orders are written rules governing the conditions of employment in an industrial establishment.

2. Application

• Applies to establishments with 100 or more workmen (some states have reduced to 50 or 20)
• Applies to all industries as defined under the ID Act
• Central and State governments can extend application to smaller establishments

3. Matters Covered — Schedule (11 Subjects)

1. Classification of workmen (permanent, temporary, apprentice, probationer, badli)
2. Manner of intimating work hours, holidays, pay days, wage rates
3. Shift working
4. Attendance and late coming
5. Conditions and procedure for leave
6. Entry and exit through specified gates
7. Closing and reopening of sections
8. Termination of employment and notice period
9. Suspension, dismissal, and disciplinary procedure
10. Means of redress for workers against unfair treatment
11. Any other matter prescribed by the government

4. Certification Procedure

1. Employer submits 5 copies of draft standing orders to the Certifying Officer within 6 months of the Act becoming applicable
2. Certifying Officer sends copy to workers/TU and invites objections within 15 days
3. Hearing of both parties
4. Certifying Officer certifies the standing orders (with or without modifications)
5. Appeal to Appellate Authority within 30 days
6. Standing orders become effective 30 days after certification
7. Must be displayed in English and local language at workplace entrance

5. Modification — Section 10

• Either employer or workers can apply for modification
• Cannot apply for modification within 6 months of certification or last modification
• Same procedure as original certification

6. Model Standing Orders

• If an employer fails to submit draft standing orders, the {key('Model Standing Orders')} (prescribed by the government) automatically apply
• Model Standing Orders serve as a default framework

7. Penalty — Section 13

• Failure to submit: fine up to Rs. 5,000
• Continuing offence: Rs. 200 per day of default
• Violation of certified standing orders is a punishable offence