Industrial Dispute Act 1947: History, Objective, Features

What is Industrial Dispute Act 1947?

The Industrial Dispute Act 1947 mainly deals with the provisions for the investigation and settlement of industrial disputes. It extends to the whole of India. It was enacted shortly after India’s independence and serves as a framework for maintaining harmonious industrial relations and promoting social justice in the workplace.

Industrial Dispute Act 1947 Notes

The primary objective of the Industrial Disputes Act is to provide a legal mechanism for the prevention and settlement of industrial disputes, which may arise due to various factors such as wages, working conditions, employment terms, and disciplinary actions. The Industrial Dispute Act 1947 was enacted by Central Legislative Assembly. It was Assented to 11tg March 1947, and it was commenced on 1st April 1947.

Read: Industrial Policy of India

Objectives of Industrial Dispute Act 1947

The Industrial Disputes Act 1947 aims to maintain peace and harmony in the workplace by setting up a system and process for the investigation and negotiation of labour disputes.

• One of the objectives of the Industrial Disputes Act 1947 is to promote positive interactions between labour and business and to give adjudication authorities a means of mediating disputes.
• To establish a committee for resolving disputes between business and labour, with the option of having a registered trade union or an employer association represent it.
• Industrial Disputes Act 1947 prevents unapproved lockouts and strikes.
• Speak with workers who have been let go, fired unfairly, etc.

Features of Industrial Dispute Act 1947

The Industrial Disputes Act, 1947 encompasses several essential features that are fundamental to the regulation of industrial relations and the resolution of conflicts. The features of the Act are:

Section 2(aaa) of this Industrial Dispute Act 1947

The average pay means the average of the wages of:

• Three complete calendar months in case of monthly paid
• Four complete weeks, in the case of the weekly paid workman.
• Twelve full working days, in case of the daily paid workman.

Industrial dispute (Section 2(k)) of the Industrial Dispute Act 1947

It means any dispute which is connected with the employment or non-employment or the conditions of labour between:

• Employers and employers.
• Employers and workmen.
• Workmen and workmen.

Lay-off (Section 2(kkk)) of Industrial Dispute Act 1947

If an employer fails to give employment to a workman on the following grounds, then it is referred to as

• Shortage of coal or power or raw materials
• Accumulation of stocks or
• Break-down of machinery
• Natural calamity or for any other connected reason

Lock-out (Section 2(l)) of the Industrial Dispute Act 1947

Section 2(l) of the Industrial Dispute Act 1947 defines “lock-out” under the Act. According to this section, a lock-out refers to 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 workers, where such closing, suspension, or refusal occurs as a result of a dispute between the employer and workers.

Retrenchment (Section 2(oo)) of the Industrial Dispute Act 1947

It means the termination of a workman of the service by the employer for any reason. It does not include the following:

• Voluntary retirement.
• Retirement at the age of superannuation.
• Non-renewal of the employment contract.
• Continued illness.

Labour courts (Section 7) and Tribunals (Section 7A) of the Industrial Dispute Act 1947

It shall consist of only one person appointed by the appropriate government. The following are the common qualifications for a presiding officer of a labour court or a tribunal:

• Judge of a High Court or
• The district judge or an additional district judge for a period of not less than three years or
• Deputy Chief Labour Commissioner (Central) or Joint Commissioner of the State Labour Department, having a law degree and at least seven years experience in the labour department, including three years of experience as a Conciliation Officer or
• Grade III officer of Indian Legal Service with three years of experience.
• Apart from the above, any person with the following qualifications can also be appointed as the presiding officer.

Section 7B – National Tribunal

It is constituted by the central government and shall consist of only one person. The presiding officer of the tribunal must be a person who worked or has been a judge of a high court. The National Tribunal, as per the Industrial Dispute Act 1947, has the provision for the Central Government to appoint two individuals as assessors. These assessors are appointed to provide guidance and advice to the National Tribunal during its proceedings if deemed necessary by the Central Government.

Punishment Under Industrial Dispute Act 1947

Any person committing any unfair labour practice shall be punishable with a maximum imprisonment of six months or a maximum fine of one thousand rupees or both under the Industrial Dispute Act 1947.

• Any workman who commences or continues an illegal strike shall be punishable with a maximum imprisonment of one month, or with a maximum fine of fifty rupees, or both.
• Any employer who commences or continues an illegal lock-out shall be punishable with a maximum imprisonment of one month, with a maximum fine of one thousand rupees, or both under the Industrial Dispute Act 1947.
• Any person who gives financial aid or instigates or incites others, or takes part in an illegal strike or lock-out shall be punishable with a maximum imprisonment of six months or with a maximum fine of one thousand rupees or both.
• Any person who commits a breach of any term of any settlement or award shall be punishable with a maximum imprisonment of six months, or fine, or both under Industrial Dispute Act 1947.

Controversy Around the Industrial Disputes Act 1947

The Industrial Dispute Act of 1947 was brought into force for the investigation and settlement of industrial disputes, and it was applicable to all, irrespective of size and sector. Industrial Dispute Act had provisions regarding the conditions for layoffs and closure of Industry.

• If an industrial establishment employs more than fifty workers, then it needs to give a notice period of 60 days with the reasons for closure to the appropriate government before the closure. This was again increased to 90 days in 1982.
• If it has more than 300 employees, it needs to take prior approval from the government authority for the approval of layoffs, closure, and retrenchment. The limit was again increased to 90 days in 1982.

The main purpose of this provision is to make sure that the employers can’t hire or dire any employee whenever it wants. For such action, it needs approval from the labour commissioner. This has led to various problems in the labour industry, such as Lower output by labour, lower investments, lower productivity, hesitation in hiring, lower overall manufacturing performance, and foreign investors being deterred from investing in India.

• Labour Reforms and Codes
• Industrial Revolution

Industrial Dispute Act 1947 UPSC

The Industrial Dispute Act of 1947, serves as a vital framework for maintaining harmonious relationships between employers and workers, protecting their rights, and promoting social justice in the workplace. The Industrial Dispute Act, of 1947 is a part of the UPSC economics syllabus that equips aspirants with knowledge about labour laws, industrial relations, and the socioeconomic implications of a well-regulated industrial environment. Candidates need to thoroughly cover this topic with the help of notes, and the best economics UPSC books while preparing for UPSC CSE.

Industrial Dispute Act 1947 MCQs

Question: The Industrial Dispute Act, 1947 provides a legal framework for the resolution of disputes between: a) Employers and employees b) Employers and trade unions c) Employees and trade unions d) Employers, employees, and trade unions

Answer: d) Employers, employees, and trade unions

Question: The Industrial Dispute Act, 1947 applies to industrial establishments employing a minimum of how many workers? a) 10 workers b) 50 workers c) 50 workers d) 100 workers

Answer: b) 50 workers

Question: The Industrial Dispute Act, 1947 provides provisions for which of the following? a) Recognition of trade unions b) Collective bargaining c) Settlement of disputes d) All of the above

Answer: d) All of the above

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