Dispute Resolution Mechanisms Under Industrial Disputes Act, 1947 and Industrial Relations Code

Rashmi Bagri

12 Jan 2022 4:11 PM GMT

  • Dispute Resolution Mechanisms Under Industrial Disputes Act, 1947 and Industrial Relations Code

    Industrial Relations Code, 2020 states in its objectives that it aims to "minimize the friction between the employers and workers; provide provisions for investigation and settlement of Industrial Disputes and achieve industrial peace and harmony as the ultimate pursuit in resolving industrial disputes" and thus, this article aims to analyze the multiple institutions provided...

    Industrial Relations Code, 2020 states in its objectives that it aims to "minimize the friction between the employers and workers; provide provisions for investigation and settlement of Industrial Disputes and achieve industrial peace and harmony as the ultimate pursuit in resolving industrial disputes" and thus, this article aims to analyze the multiple institutions provided in both Industrial Disputes Act, 1947 and its successor, Industrial Relations Code, 2020 to resolve industrial disputes and attain the objectives mentioned above.

    There are several mechanisms and institutions provided in Industrial Disputes Act, 1947 to prevent disputes and resolve disagreements between workmen and employers. These include Works Committee (S.3), Board of Conciliation (S.5), Courts of Enquiry (S.6), Labour Courts (S.7), Tribunals (S.7A) and Voluntary Arbitration (S.10A).

    The industrial relations Code is inclusive of most of the forums and methods mentioned above except Conciliation Board (although it includes conciliation officer), Labour Court and Court of Inquiry and adds Grievance Redressal Committee to the list.

    Works Committee

    It is included under S. 3 in both Industrial Disputes Act (ID Act), as well as Industrial Relations Code (IRC). Works Committee has to be formed by the appropriate government through a general or special order in establishments having more than 100 workmen and this remains same in both the Industrial Disputes Act and Industrial Relations Code. Why would the Code leave its existence to the will of the 'appropriate government' and not make having a works committee mandatory in all Industrial establishments, since its purpose is to 'promote measures for securing and preserving amity and good relations between employer and workers', is something that has not yet been established? In fact, in the words of the Second national commission on labour, the works committee has been utterly unsuccessful and the reason for its failure has been attributed to both its method of formation and the functions that have been assigned to it.

    Regardless, if in case the appropriate government does decide to form a Works Committee, it shall have equal number of representatives of both the employer and the workmen and in no case, the representatives of workmen shall be less than the number of representatives of the employer, as per S.3 of both the ID Act, 1947 and IRC.

    Grievance Redressal Committee

    This committee was absent in the ID Act, 1947 although, via 2010 amendment, S.9C was added to the Code which provided for a similar mechanism (Grievance Settlement Authority). This section is only applicable in industrial establishments having fifty or more workmen and allows for only six members to be on this Grievance settlement authority. The chairperson membership is to rotate annually, alternatively between all committee members (once from representatives of employer and once from representatives of workmen). All proceedings of the committee have to be completed in a month and there is a provision of an appeal to the employer against the decision of grievance settlement authority and the employer have to dispose of the appeal within a month of receiving its receipt.

    On the other hand, the Grievance Redressal Committee features in Chapter 2 of IRC in S.4. S.4 states that all establishments with 20 or more workmen must have a grievance redressal committee which shall have an equal number of representatives from the workmen and the employer's side. The total number of members on the grievance redressal committee shall not be more than 10 (as opposed to 6 in grievance settlement authority of ID Act, 1947) inclusive of proportional representation of women workers' representatives. On a rotational basis, the chairperson will be selected annually from committee members. Application regarding a dispute/grievance has to be filed within one year from the date from which cause of action arises and the grievance redressal committee has to try to complete its proceedings within thirty (30) days from the date it receives the receipt of such application. Although the committee's decision is based on a majority view, if more than 50% of members representing the workmen do not concede to the decision, then it shall be deemed that no decision has been arrived at. Furthermore, if the aggrieved worker is not satisfied with the decision of the Committee, he can file for conciliation with the conciliation officer through the trade union of which he is a member (as opposed to filing an appeal to an employer as given in 9C, ID Act, 1947), within sixty (60) days of being made aware of the decision of the Committee. If dissatisfied with this process also, the aggrieved worker may, on the expiry of forty-five (45) days of applying to the conciliation officer, may make an application directly to the Tribunal for adjudication of the dispute and the tribunal shall have powers under S.53 of IRC, 2020 to adjudicate upon it.

    Conciliation officers have been defined under S.4 of the ID Act, 1947 and S.43 of IRC.


    Under S.4 of ID Act, 1947, a conciliation officer is to be appointed by the appropriate government (central/state government) and is charged with the duty of mediating in and promoting the settlement of disputes. Furthermore, the appropriate government can provide conciliation officers for a specific area, industry and time period and the number of conciliation officers is not limited, which means that the appropriate government can provide for as many conciliation officers as it deems fit. Conciliation proceedings have to be completed expeditiously and in case the conciliation proceedings are not completed within a period of 45 days (from the date application was made) then under S.4(10), the concerned worker can file an application in the Industrial tribunal. S.12 of ID Act, 1947 provides for duties of conciliation officers and says that conciliation officer shall investigate the dispute without delay so that parties can come to a fair and amicable settlement although it has to be pointed out that conciliation officers do not have the authority to impose a solution upon the parties. And in case a dispute is not settled via conciliation, a copy describing the reasons for failure has to be sent to the parties to the dispute under S.12A. Another point to be noted is that when the conciliation proceedings are ongoing, all strikes and lockouts are prohibited under ID Act, 1947 (except if it's a public utility service industry, as per S.22, ID Act, 1947.)

    While the definition of Conciliation officer, appointing authority and the purpose of appointment remains the same under S.43 of IRC as given in S.4 of ID Act, 1947, the conciliation officer is mandated not to hold any conciliation proceedings relating to an industrial dispute pertaining to strikes and lockouts, after two years from the date on which such dispute arose, as per S. 53 of IRC.

    Furthermore, if a settlement has been arrived at, in conciliation proceedings, the conciliation officer will send, a report and the memorandum of settlement duly signed by the parties, to the appropriate government or any officer authorized on its behalf. And if a settlement is not arrived at, then the conciliation officer will send a full report describing the steps taken by him to resolve the dispute and the reasons for failure to arrive at a settlement, to the appropriate government and the concerned parties, within 45 days from the commencement of conciliation proceedings and if the matter pertained to strikes and lockouts under S.62 of IRC, then the report shall be sent within 14 days of the commencement of proceedings. The concerned party can, within 90 days of receiving the above-mentioned report, make an application to the Tribunal for settlement of a dispute.

    Voluntary reference of disputes to arbitration

    There are certain differences regarding this in ID Act, 1947 and IRC. Under S. 10A(1) of ID Act, 1947 dealing with voluntary reference of disputes to arbitration, an industrial dispute b/w an employer and workman can be referred to arbitration by a written agreement, any time before it has been referred to a Labour Court/Tribunal under S.10 of ID Act, 1947. While under S.42(1) of IRC, no such pre-condition exists and any dispute can be referred to arbitration via a written agreement.

    If an arbitration agreement provides for an even number of arbitrators, the agreement shall provide for the appointment of another person as an umpire in case the arbitrators are divided in their opinion and the award of the umpire shall prevail. This provision has been the same in both ID Act, 1947 and IRC.

    A copy of the arbitration agreement must also be forwarded to the appropriate government and the Conciliation Officer. But while ID Act, 1947, under S. 10A(3) mandates that the appropriate government shall publish this copy in the official gazette within one month of receipt of such copy, no such requirement has been put on appropriate government under S.42(3) of IRC.

    When the dispute has been referred to arbitration and the appropriate government is satisfied that the persons making the reference represent a majority of each party, the arbitrator shall also give a chance to the workers and employers who are not parties to the agreement (but who are affected by the dispute), to represent their case. In this case, the appropriate government can prohibit the continuance of any strike/lockout in connection with the dispute in question, via a notification. However, while S.42(5) of IRC lists down who will be representing the worker/workers before the arbitrators, S.10A(3A) of ID Act, 1947 is silent on the same.

    The arbitrator shall then investigate the dispute and submit the award to the appropriate government.

    Industrial Tribunal

    Industrial tribunals as a mode of dispute resolution for industrial disputes has been provided in detail both in S. 7A of ID Act, 1947 and S.44 of the IRC.

    S.7A of ID Act says that appropriate government can constitute one or more tribunals for adjudication of industrial disputes relating to matters covered in the second and third schedule and for any other purpose which is assigned to them under ID Act, 1947. Tribunal shall have one person (only) appointed by the appropriate government, although if the appropriate government thinks it fit then it may also appoint two assessors to advise the Tribunal in the proceedings. Furthermore, only a person who is or has been a judge of a High Court or has been a district judge or additional district judge for three years can be appointed as the presiding officer of the tribunal. And as per S.7C of ID Act, 1947 and S.48 of IRC, the presiding officer must also be an independent person (not connected with the dispute or any industry affected by that dispute – as explained in S.48 of IRC) and must be less than 65 years of age. If not so, any person appointed to a tribunal or national tribunal who does not fulfil this criterion shall be disqualified from the tribunal.

    S.44 of IRC is a much lengthier section and has certain features which were absent in S. 7A of the ID Act, 1947. S.44 says that appropriate government can constitute one or more tribunals for adjudication of industrial disputes and any other functions assigned to it under this Code. And if a tribunal is constituted by the Central government, it shall exercise all powers, authorities and jurisdiction conferred upon such tribunal via S.2(m) of Employees Provident Funds and Miscellaneous Provisions Act, 1952.

    Under S.44(2), every industrial tribunal shall have two members (one judicial and one administrative) who will be appointed by the appropriate government. And a tribunal bench under S.44(3) will comprise either of two members mentioned above or a single judicial/administrative member. But if the tribunal bench consists of one judicial and one administrative member, then the judicial member will preside over the tribunal, as laid down in S.44(8). Additionally, the appropriate government may even provide for a such number of members and other staff as it thinks fit, for effective functioning of the tribunal, after consulting with the judicial member, as per S. 44(10).

    Note - Under S.44(4), any person who has held a post below the rank of Joint Secretary to the Government of India or an equivalent rank in Central government or state government shall not be eligible to be appointed as an administrative member of the tribunal.

    • Furthermore, the method of recruitment, qualifications for appointment, terms of office, salaries and allowances, resignation, removal and other terms of conditions of service of the tribunal members of a tribunal constituted by the Central Government shall be in accordance with rules made under S.184 of Finance Act, 2017 while those of members of a tribunal constituted by a State government shall be prescribed by the State government.

      To ensure objectivity and transparency in the performance of the tribunal members; salaries, allowances, terms and conditions of service of members of a tribunal appointed by the state government shall not be varied to their disadvantage.

      The code also specifies the kind of cases that can be taken up by a tribunal bench consisting of a judicial and an administrative member under S.44(7) and says that such benches shall only entertain cases pertaining to

        • The application and interpretation of standing order
        • Discharge/dismissal of workmen including reinstatement of/grant of relief to workmen dismissed
        • Illegality or otherwise of a strike or lockout
        • Retrenchment of workmen and closure of an establishment
        • Trade union disputes

      While the rest of the cases shall be taken up by a single member (either administrative or judicial) tribunal bench.

      Furthermore, if for any reason, vacancy (other than a temporary absence) arises in a tribunal or a National Industrial Tribunal, then the proceedings shall continue from the stage at which that vacancy is filled.

      National Industrial Tribunal

      This has also been covered both in S.7B of ID Act, 1947 and S.46 of IRC, however, while S.7B of ID Act, 1947 is succinct and S.46 of IRC is comprehensive.

      S.7B of ID Act, 1947 says that the Central Government may constitute one or more tribunals, via a notification in the official gazette for adjudication of industrial disputes which involve questions of national importance or disputes which will interest/affect more than one state. This National Tribunal shall only have one person (the presiding officer) who will be appointed by the Central government, although if the Central government deems fit, it may appoint two persons as assessors to advise the presiding officer. Further, only a person who is or has been a judge of a High Court shall be qualified to be appointed as the presiding officer.

      S.46 of IRC although gives the same powers to the Central government to constitute one or more tribunals for adjudication of industrial disputes involving a question of national importance or affecting one or more states, the number of members on National Industrial Tribunal under IRC is two (2) instead of one (1) given under ID Act, 1947. So, under S.46(2) IRC, a National Industrial Tribunal shall consist of two members (one judicial and one administrative) who will be appointed by the Central government and a person is only qualified to be appointed as a judicial member if he is or has been a judge of a High Court. Even for appointment as an administrative member, the person either should be or must have been Secretary to the government of India or must hold an equivalent rank in Central government or state government, have adequate experience of handling labour-related matters.

      Furthermore, although the National Industrial Tribunal will have two members, only the judicial member shall preside over the tribunal. And for the due discharge of functioning of the tribunal, the Central Government may, after consulting with the judicial member, provide such number of officers and staff as it thinks fit. Additionally, if the Central government believes that an industrial dispute involves a question of national importance or affects more than one state, it may refer such industrial dispute to a National Industrial Tribunal, as per S.54 of IRC, which deals with Reference to and functions of National Industrial Tribunal.

      The decision of a tribunal (including National Industrial Tribunal) shall be arrived at by consensus of members and if the members, by chance, differ in opinion on any point, they shall refer the same to appropriate government and then the appropriate government shall appoint a judicial member from some other tribunal (inclusive of a National Industrial Tribunal) who will hear the case and then again the decision shall be decided by a majority of members on the Tribunal (which now includes an extra-judicial member). This provision does not find a place in ID Act, 1947 and has been provided in S.47 of IRC.

      Furthermore, under S.45 of IRC, no notification of appropriate government regarding the appointment of a person as a judicial or administrative member of a tribunal shall be called in question. And no proceeding/act of the tribunal shall be questioned citing the existence of vacancies in the tribunal or defect in the Constitution of such Tribunal. S.9(1) of ID Act, 1947 essentially says the same as well but

      • ID Act, 1947 does not encompass having two members on a tribunal
      • S.9 also talks about the order of a Labour Court which has been done away with in IRC.

      So, S.9 of ID Act, 1947 says that no order of appropriate government appointing any person as a chairman/member of a Board/Court or presiding officer of a Labour Court/Tribunal/National Tribunal shall be questioned and no act/proceeding of any Board/Court shall be questioned only on the ground of existence of a vacancy in or defect in the Constitution of such Board/Court. Furthermore, any settlement arrived at in conciliation proceedings, shall not be declared invalid just because the settlement was arrived at after the expiry of the period of 14 days given under S.12(6) or the two (2) month period given in S.13 of ID Act, 1947.

      Procedure and Powers of arbitrators, conciliation officer, Tribunal and National Industrial Tribunal

      S.49 of IRC discusses these. S.49(1) is about procedures to be followed and says that arbitrator, conciliation officer, tribunal or national industrial tribunal may follow such procedure as they deem fit, subject to the provisions of this Code and rules therein.

      S.49(2) is about powers of the conciliation officer or any other officer authorized by a Tribunal (including a National Industrial Tribunal) to enter the premises occupied by the establishment related to the dispute for the purpose of inquiry into the dispute. But they can do so after giving reasonable notice to the owner/manager of the establishment. Furthermore, S.49(3) points out that Conciliation officer, tribunal, national industrial tribunal shall have the powers of a civil court under CPC vested in them when they are trying a suit

      • enforcing the attendance of any person and examining him on oath
      • compelling the production of documents and material objects
      • issuing commissions for the examination of witnesses
      • in respect of such other matters as may be prescribed.

      And thus, it also follows that every inquiry or investigation by Tribunal or National Industrial Tribunal shall be deemed to be a judicial proceeding within the meaning of S.193 and S.228 of the Indian Penal Code.

      The power of a conciliation officer also includes enforcing the attendance of any person for the purpose of examination or to inspect any document relevant to an industrial dispute or any document necessary to verify the implementation of any award or to carry out any duty imposed on the conciliation officer under IRC and to do this, the conciliation officer has been vested with the powers of a civil court under CPC, 1908.

      All conciliation officers and members of a tribunal or national Industrial tribunal (including assessors/experts appointed by the appropriate government to advise a tribunal/National Industrial Tribunal under S.49(5)) shall be deemed to be public servants under S.21 of the Indian Penal Code. And the tribunal and National industrial tribunal have also been given powers to determine by and to whom, to what extent and subject to what conditions the costs are to be paid and the person who is entitled to such costs may make an application to the appropriate government that may recover these costs in the same manner as an arrear of land revenue, as per S.49(7).

      Furthermore, every tribunal or national industrial tribunal shall be deemed to be a civil court even for the purposes of S. 345, 346 and 348 of the Code of Criminal Procedure, 1973. And every award/settlement arrived at by the Tribunal/National Industrial Tribunal shall be executed in accordance with the procedure given for execution of orders and decree of a civil court under Order 21 of CPC.

      S.11 of ID Act, 1947 talks about the same powers and procedures but is inclusive of labour court and a board of conciliation which have been omitted from the IRC.

      Powers of Tribunal and National Industrial Tribunal to give appropriate relief in case of discharge or dismissal of a worker

      This Section also finds a place in the ID Act, 1947 in the form of S.11A, however, as mentioned repeatedly, ID Act, 1947 is inclusive of Labour Courts while IRC has done away with them.

      In IRC under S.50, if a tribunal/National Industrial Tribunal is satisfied that the order of discharge/dismissal/termination was not justified, it may set aside that order via an award and may direct reinstatement of the worker on such terms and conditions, as it thinks fit. Although not every dismissal will warrant reinstatement and it depends on circumstances of each case. It may also give such other relief to workers including the award of any lesser punishment instead of discharge/dismissal/termination as the circumstances of the case may require. Interim relief may also be provided if the tribunal deems fit although, to provide interim relief, the tribunal/National Industrial Tribunal shall only rely on the material on record and not take any fresh evidence into consideration.

      An important Section under IRC is S.51 which deals with the transfer of pending cases and says that the cases pending in Labour Court/Tribunal constituted under ID Act, 1947 from before the commencement of Industrial Relations Code, shall be transferred to the Tribunal/National Industrial Tribunal having jurisdiction under IRC on the date of its commencement and shall be dealt with de novo or from the stage at which they were pending before such transfer.

      Furthermore, S. 52 talks about adjustment of services of presiding officers under repealed Act and says that a presiding officer of a labour court/tribunal/national tribunal constituted under Industrial Disputes Act, 1947 who was holding that office immediately before the commencement of IRC and is qualified under IRC, shall be appointed as a Judicial Member of the Tribunal/National Industrial Tribunal and shall continue as such for the remaining period.

      Form of Award, its communication and commencement

      While this section has been broken down under three different sections in ID Act, 1947 (S.16, S.17 and S.17A), Under IRC, all these have been encompassed under a single section, S.55.

      First looking at S.16, S.17 and S.17A of the ID Act, 1947: Regarding the form of report or award, the ID Act, 1947 says that the report of a Board/Court/Tribunal/National Tribunal shall be in writing, and in case of (conciliation)Board and Court, it shall be signed by all members and in case of Tribunal/National Tribunal, it shall be signed by the presiding officer and nothing shall prevent any member of board or court from recording any minute of dissent. Regarding publication, S.17 says that every report including the minute of dissent and every award shall be published by the appropriate government within 30 days of it receiving a receipt of such award, in the manner that it deems fit and subject to S.17A, the award shall be final and shall not be called into question. The award shall also become enforceable on the expiry of 30 days from the date of its publication. Although, if the appropriate government (in case of labour court/tribunal) and central government (in case of a national tribunal) is of the opinion that it will be unwise to give effect to the award, in whole or in part, on the public ground affecting the national economy or social justice, then the appropriate government or central government can declare, through a notification in the official gazette, that the award shall not become enforceable on the expiry of the said period of thirty days. Under S.17A (2), the appropriate government/central government can also make an order rejecting or modifying the award, within 90 days of publication of the award on the grounds mentioned above and shall lay this award together with a copy of an order in front of the state legislature (if order given by state government) or before Parliament, if the order has been made by Central government. Once the award has been laid before the state legislature or the Parliament, it shall become enforceable on the expiry of fifteen days from the date on which it is so laid.

      S.55 of IRC is more simplified, yet comprehensive in its approach and says that the award of a tribunal and a National Industrial Tribunal shall be in writing and shall be signed electronically/otherwise by both Judicial and administrative members or by a member by whom the award is delivered, which shall then be communicated to parties concerned and the appropriate government and the award shall become enforceable on the expiry of 30 days from date of receipt of such communication. The rest of the points are exactly the same as provided in S.17A of the ID Act, 1947.

      There is also a provision of payment of full wages to workers pending proceedings in higher courts in both ID Act, under S.17B and IRC under S. 56. This section remains the same in both the Act and the Code, except the fact that the ID Act, 1947 covers Labour Court and IRC does not.

      Persons on whom settlements and awards are binding

      This section also features in ID Act, 1947 under S.18 and in IRC under S.57.

      Clause 1 of both articles says that a settlement arrived at by agreement between employer and worker (otherwise than through conciliation proceedings), then the award shall be binding on the parties to the agreement. While under Clause 3 of both articles, a settlement arrived at through conciliation proceedings, shall be binding on

      • all parties to the industrial dispute
      • all other parties summoned to appear in the proceedings as parties to the dispute
      • if the party referred above is an employer, then his heirs, successors etc.
      • if the party referred to in the first two points is composed of workers, then all persons employed in that establishment to which the dispute relates and who subsequently become a part of that establishment.

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