Karnataka High Court Issues Guidelines For Subsequent Reference To Labour Court After Either Party Disputes Earlier Settlement

The Karnataka High Court has held that if a dispute is raised questioning the validity of a settlement under Section 12(3) of the Industrial Disputes Act 1947, before a conciliation officer, the appropriate Government is required to assign reasons for referring it to adjudication.Justice Anant Ramanath Hegde held thus while partly allowing the petitions filed by the Management of Bosch Ltd which had challenged the order dated 28.06.2021, passed by the appropriate Government, referring the dispute raised by around 160 workmen for adjudication before the labour court. The bench said, “Where at least one of the parties alleges that settlement is recorded under Section 12(3) of the Act, 1947, in the presence of the Conciliation Officer, and the other party disputes it, the standard of scrutiny required to be undertaken by the appropriate Government under Section 12(5) is couple of degrees higher, as compared to disputes not emanating from a settlement under Section 12(3) of the Act, 1947.” Further, it clarified that the appropriate Government has to not adjudicate on the merits of the settlement arrived at before the Conciliation Officer. Such an exercise is not permissible given the scope of Section 12(5) of the Act, 1947. It laid down the following guidelines to be followed by the appropriate Government to prima facie satisfy itself, for referring the matter to the labour court for adjudication: (i) The settlement has resolved all the disputes which were the subject matter of the conciliation proceeding. (ii) Any dispute that is the subject matter of a conciliation proceeding is still unresolved, despite settlement. (iii) The settlement said to have been arrived at, prima facie, contravenes any of the provisions of the Act, 1947 or the binding Standing Orders? (iv) The settlement is duly signed by parties to the settlement or authorised persons representing the parties? (v) The settlement on the face of it, on account of the efflux of time, appears to have been acted upon? The bench said “On the above consideration, the Government has to satisfy itself as to whether the matter requires to be referred to for adjudication or not, and then has to pass an appropriate order.” It added “This Court is not holding that in case the dispute is raised relating to the settlement under Section 12(3) of the Act, 1947, the Government has no power to refer the dispute to the Tribunal or the Labour Court, but only adding that in such situation, the appropriate Government has to consider the above noted factors before taking a call as to whether the dispute has to be referred for adjudication or not.” Case Background: An industrial dispute arose between the Workmen and the Employer on the premise that the Workmen were denied employment from 16.08.2015. Before the Conciliation Officer, proceedings were held, and on 01.10.2016, the Conciliation Officer recorded that the conciliation failed and referred the matter to the appropriate Government. It appears, parties thought of amicably negotiating a workable solution, and at the intervention of the minister for the concerned Industry, the conciliation 73 proceeding resumed before the jurisdictional Deputy Labour Commissioner. In the said proceeding, on 08.02.2017, the settlement was recorded. Workmen received Rs 14 lakhs each towards the full and final settlement of their claim. Receipt of Rs.14 lakhs each by the Workman is not in dispute. Some of the Workmen raised an industrial dispute questioning the validity of the settlement. They even questioned the validity of the settlement dated 08.02.2017.The counsel appearing for the company argued that the settlement dated 08.02.2017 is voluntarily executed in the presence of a Conciliation Officer. The settlement is binding on the Workmen in view of the mandate of Sections 18 and 19 of the Act, 1947. Having received Rs.14.00 lakhs, as agreed in the year 2017, it is not open to the Workmen to file Writ Petitions in the year 2021 alleging that the workmen were forced to sign the terms of the settlement under force, coercion, and threat. Moreover, in view of the settlement dated 08.02.2017, the Industrial Dispute does not exist between the Workmen and the Employer, as the relationship of employer and employee has come to an end by way of an amicable settlement. Findings: The bench on going through the record noted that the Conciliation Officer concluded that the conciliation failed and sent a report on 01.10.2016 to the Additional Chief Secretary, Department of Labour, to take further action for referring the dispute for adjudication. One more conciliation proceeding was held at the request of both Workmen as well as the Employer at the intervention of the Minister for Minimum and Large-Scale Industries. Employer claimed that second conciliation initiated at the request of both the Employer and the Workmen ended in a settlement as recorded on 08.02.2017.Further, it is admitted that the settlement dated 08.02.2017 is signed by the...

Karnataka High Court Issues Guidelines For Subsequent Reference To Labour Court After Either Party Disputes Earlier Settlement

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