PROJECT ON

“UNFAIR LABOUR PRACTICES”

A project submitted to
University of Mumbai for assignment completion
of the degree of Bachelor of Laws
Under the Faculty of Law

By
Anuj Patel
Roll No. 22
FY-LLB Under the Guidance of Prof. Pranita Hingmire

SIDDHARTH COLLEGE OF LAW

Mumbai 400-023
2020-2021

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 INDEX

SR. NO. CONTENTS PAGE NO.

1 Project Name With Students Details
2 Index 2
3 Introduction 3
4 Unfair Labour Practices On The Part Of Employers And 4
Trade Union Of Employers
5 Unfair Labour Practices On The Part Of Workmen And 7
Trade Unions Of Workmen
6 Labour Laws In The Unorganised Sector 8
7 Purpose Of The Unorganised Workers’ Social Security Act 9
Of 2008
8 Case Related To Unfair Labour Practices 12
9 Conclusion 15
10 Bibliography 17

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 UNFAIR LABOUR PRACTICES

INTRODUCTION

Labour Policy of India

Labour policy in India has been evolving in response to specific needs of the situation to suit requirements of
planned economic development and social justice and has two fold objectives, namely maintaining industrial
peace and promoting the welfare of labour.

In the Constitution of India from 1950, articles 14-16, 19(1)(c), 23-24, 38, and 41-43A directly concern labour
rights. Article 14 states everyone should be equal before the law, article 15 specifically says the state should
not discriminate against citizens, and article 16 extends a right of "equality of opportunity" for employment or
appointment under the state. Article 19(1)(c) gives everyone a specific right "to form associations or unions".
Article 23 prohibits all trafficking and forced labour, while article 24 prohibits child labour under 14 years old
in a factory, mine or "any other hazardous employment".

Indian labour law makes a distinction between people who work in "organised" sectors and people working in
"unorganised sectors". The laws list the ditors to which various labour rights apply. People who do not fall
within these sectors, the ordinary law of contract applies.

UNFAIR LABOUR PRACTICES

According to Sec.2 (ra) of the Industrial Disputes Act, 1947, unfair labour practices refer to “any of the
practices specified in the Fifth Schedule to the Industrial Disputes Act, 1947. According to Section 25T of the
Industrial Disputes Act, 1947 no employer or workman or a trade union, whether registered under the Trade
Unions Act, 1926 or not, shall commit any unfair labour practice. Fifth Schedule to the Industrial Disputes
Act, 1947 provides a list as to what constitutes an unfair labour practices:

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 UNFAIR LABOUR PRACTICES ON THE PART OF EMPLOYERS AND TRADE
UNION OF EMPLOYERS

1. To interfere with, restrain from or coerce workmen in the exercise of their rights to organise, from,
join or assist a trade union, or to engage in concerted activities for the purposes of collective bargaining
or other mutual aid or protection, i.e.

a. Threatening workmen with discharge or dismissal, if they join a trade union,

b. Threatening a lock out or closure if a trade union is organised,

c. Granting wage increase to workmen at crucial periods of the union organisation, with a view to undermining
the efforts of the trade union organisation

2. To dominate, interfere with or contribute, support, financially or otherwise to any trade union, that
is to say: ‐

a. An employer taking an active interest in organising a trade union of his workmen and

b. An employer showing partiality or granting favour to one of several trade unions attempting to organise his
workmen or to its members where such a trade union is not a recognised trade union.

3. To establish employer sponsored trade unions of workmen.

4. To encourage or discourage membership in any trade unions by discriminating against workman,

that is to say:‐.

a. Discharging or punishing a workman, because he urged other workmen to join or organise a trade union.

b. Discharging or dismissing a workman for taking part in strike (not being a strike which is deemed to be an
illegal strike under this act)

c. Changing seniority rating of workmen because of trade union activities

d. Refusing to promote workmen to hire posts on account of their trade union activities

e. Giving unmerited promotions to certain workmen with a view to creating discord between other workmen
or to undermine the strength of their trade union.

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f. Discharging office bearers or active members of the trade union on account of their trade union activities

5. To discharge or dismiss workmen‐

a. By way of victimisation

b. Not in good faith but in the colourable exercise of the employer’s right

c. By falsely implicating a workman in a criminal case on false evidence or concocted evidence

d. For patently false reasons

e. On untrue or trumped up allegations of absence without leave

f. In utter disregard of the principles of natural justice.

g. For misconduct of minor or technical character, without having any regard to the nature of the particular
misconduct or the past record of service of the workman, thereby leading to disproportionate punishment.

6. To abolish the work of a regular nature being done by workmen and to give such work to contractors
as a measure of breaking a strike.

7.To transfer a workman mala fide from one place to another under the guise of following management
policy.

8. To insist upon individual workman who are on a legal strike to sign a conduct bond as a precondition
to allowing them to resume work

9. To show favouritism or partiality to one set of workers regardless of merit.

10. To employ workmen as ‘badlis’, casuals or temporaries and to continue them as such for the years
with the object of depriving them of the status and privileges of permanent workmen.

11. To discharge or discriminate against any workmen for filing charges or testifying against employer
in any enquiry or proceeding relating to any industrial dispute.
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12. To recruit workmen during a strike which is not an illegal strike.

13. Failure to implement award, settlement or agreement.

14. To indulge in acts of force or violence.

15. To refuse to bargain collectively, in good faith with the recognised trade unions.

16. Proposing or continuing a lock out deemed to be illegal under this act.

If the employer of any establishment commits any of these acts then he will be liable for an offence of unfair
labour practice.

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 UNFAIR LABOUR PRACTICES ON THE PART OF WORKMEN AND TRADE
UNIONS OF WORKMEN

1. To advise or actively support or instigate any strike deemed to be illegal under the Industrial Disputes
Act, 1947.

2. To coerce workmen in the exercise of their right to self‐ organisation or to join a trade union or refrain
from joining any trade union, that is to say‐

a) For a trade union or its members to picketing in such a manner that non striking workmen are physically
debarred from entering the work places

b) To indulge in acts of force or violence or to hold out threats of intimidation in connection with a strike
against non‐striking workmen or against managerial staff.

3. For a recognised union to refuse to bargain collectively in good faith with the employer.

a) To indulge in coercive activities against certification of bargaining representative.

b) To stage, encourage or instigate such forms of coercive actions and wilful ‘go slow’, squatting on the work
premises after working hours or ‘gherao’ of any of the members of the managerial or the other staff.

c) To stage demonstrations at the residences of the employers or the managerial staff members.

d) To incite or indulge in wilful damage to employer’s property connected with industry.

e) To indulge in the acts of force or violence or to hold out threats of intimidation against any workman with
a view to prevent him from attending work.

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 LABOUR LAWS IN THE UNORGANISED SECTOR

The unorganised sector can be defined as that part of the work force that have not been able to organise itself
in pursuit of a common objective because of certain constraints such as casual nature of employment,
ignorance or illiteracy, superior strength of the employer singly or in combination etc. viz. construction
workers, labour employed in cottage industry, handloom/power loom workers, sweepers and scavengers, beedi
and cigar workers etc. This sector is marked by low incomes, unstable and irregular employment, and lack of
protection either from legislation or trade unions. The unorganised sector uses mainly labour intensive and
indigenous technology.

The contributions made by the unorganised sector to the national income, is very substantial as compared to
that of the organised sector. It adds more than 60% to the national income while the contribution of the
organised sector is almost half of that depending on the industry.

Under this category are laws like the Building and Construction Workers Act 1996, the Bonded Labour System
(Abolition) Act 1976, The Interstate Migrant Workers Act 1979, The Dock Workers Act 1986, The Plantation
Labour Act 1951, The Transport Workers Act, The Beedi and Cigar Workers Act 1966, The Child Labour
(Prohibition and Regulation) Act 1986, and The Mine Act 1952. Many of the labour and employment laws
apply to the unorganised sector also.

In India, only about 8% of workers actually get the benefits available under various labour Acts. The rest 92%
work in the unorganised sector, and either are not eligible for coverage, or these Acts are just not implemented
for them, with the result that these workers have insecure employments and low incomes. They have no
coverage of social security, and have to spend out of their meagre incomes for all contingencies such as illness
and children’s education; in their old age they are helpless.

This is so because the Acts as they exist today only apply to those workers who have a clear employer‐
employee relationship. 50% of India’s workers are self employed like small and marginal farmers, artisans
and street vendors, many workers work for contractors or have no fixed employer like agricultural labourers
and home‐based workers and also, employers have been decentralising, hiring contract labour and divesting
themselves of responsibility, so that even organised workers are becoming unorganised. Second, workers are
not organised and hence have no bargaining power, because of this, even when laws exist workers are too
weak, too disorganised to demand them. Third, no social security system has been devised which would meet
the needs of these workers. For example, many of these workers are migratory; others have no fixed income,
and could pay at certain times but not at others. Fourth, the laws are supposed to be implemented through the
Government bureaucracy which has neither the manpower nor the knowhow to reach the scattered crores of
workers.

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PURPOSE OF THE UNORGANISED WORKERS’ SOCIAL SECURITY ACT OF 2008

This Act builds a social security system for the unorganised workers. It does the following:

1. It redefines worker so as to include all types of workers, not only those who have a fixed employer. In
so doing, it brings in all the self employed workers as well as casual, contract, home based etc.

2. It identifies each worker and gives him/her a unique social security number and social security card.

3. It offers a variety of social security benefits to the unorganised worker. These would include health
insurance, maternity benefit and pensions. As these schemes become successful, the trust and
participation of workers’ builds up, and more funds come in, a variety of different benefits can be
included such as children’s education, housing, skill building etc.

4. It binds the Central Government to providing a minimum amount of benefits and funds.

5. It creates a structure, an architecture that works with but does not rely solely on the Government
system. It creates a participatory structure that builds on already existing civil society, government and
semi‐government organisations which have a good record.

6. It encourages the unorganised workers to organise around the social security structures and benefits,
creating a voice and space for them.

Important provisions of the Act

‘Unorganised Sector Worker” means a person who :

1. works for wages or income; and

2. directly or through any agency or contractor or who works on his own or her own account or is self
employed; and 3. in any place of work including his or her home, field or any public place; and

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4. who is not availing of benefits under the ESIC Act and the P.F Act, individual insurance and pension
schemes of LIC, private insurance companies, or other benefits as decided by the Authority from time to time.
This includes all workers in all types of occupations including agriculture.

Functions of Worker Facilitation Centres

a) Registration of workers and giving them unique identification social security numbers and identity cards.

b) Mobilisation of workers to becomes members of the Scheme.

c) Securing the contribution of members to the funds

d) Delivery of benefits to the members.

e) Maintaining a database of members in such form as may be prescribed showing the details of employment
of members registered with it.

In addition, the centres may:

f. Give skill upgradation training to increase the skill of workers.

g. Maintain and provide information related to employment and marketing opportunities for workers. Training
and assisting workers to form themselves into cooperatives, unions, federations and into any other appropriate
form of organisation.

h. Constitute employment exchanges for unorganised sector.

i. Create public awareness about schemes available for workers.

j. Collect statistics and information of workers engaged in the employments of the unorganised sector.

k. Conduct other activities as may be prescribed.

The Worker Facilitation Centres will be managed and run by a network of Facilitating Agencies. These
agencies will be reputed organisations of all types which work directly with unorganised sector workers.
They can include the following:

1. Self Help Groups or their Associations

2. Post Offices

3. All types of Co‐operative societies

4. Micro‐Finance Institutions

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5. Trade Unions

6. District Panchayat

7. Village Panchayat

8. Existing Welfare Boards

9. Urban local body

10. Any other organisation or agency dealing directly with unorganised workers, as may be identified by the
Authority below.

Registration of workers will be through the Worker Facilitation centre. Each worker will pay a nominal sum
and will obtain a unique social security card and number. The worker will then be a “member” of the Welfare
Fund and eligible for schemes.

The Authority may notify the schemes as under, subject to sustainability of the Fund:‐

i. Medical Care or sickness benefit scheme

ii. Employment injury benefit scheme

iii. Maternity benefit scheme

iv. Old age benefit including pension

v. Survivor’s benefit scheme

vi. Integrated Insurance Scheme

vii. Schemes for Conservation of natural resources on which workers depend for livelihood,

viii. Housing schemes

ix. Educational schemes

x. Any other schemes to enhance the quality of life of the unorganised worker or her family.

The Act will be executed through a Central Social Security Authority. The Authority will have a Supervisory
Board with representatives of Central and State Government, of unorganised workers and of professionals. It
will be run by a managing director and two directors appointed directly by the Union Government. The
authority will be responsible for managing the funds and implementing the provisions of the Act. It will
appoint the Facilitating Agencies as the implementing agencies on its behalf.

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 CASE RELATED TO UNFAIR LABOUR PRACTICES

Workmen’s case was that though the work in the factory was of perennial nature, it was performed through
temporaries from a pool of workers by a rotational system, seeing it that throughout the relevant period none
could complete 240 days of continuous service and thus keeping them away from secure permanent jobs.

700 workmen approached the Industrial Court with complaints of unfair labour practice invoking items 5, 6
and 10 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour
Practices Act, 1971.

A group of 300 workmen chose to initiate conciliation proceedings under the Industrial Disputes Act, 1947
upon failure of which, the State Government referred the matters to Labour Courts for adjudication.

Issues for Consideration:

Precise issues, which arise for the consideration of this Court are as follows:

(I) Whether the termination of services of temporary workmen in the present case could be termed as
termination as a result of non-renewal of the contract of employment on its expiry or under a stipulation in
that behalf contained in the contract and thus, amounting to an exception to the definition of ‘retrenchment’
contained in Clause (oo) of Section 2 of the ID Act? Or whether the rotational arrangement, such as the one
in the present case, where there are continuous temporary engagements of the same workmen over long periods
of time (adopted as a strategy to deny benefits of permanency to the concerned workmen), does not amount to
an engagement on a fixed period contract so as to form an exception under sub-clause (bb) of Clause (oo) of
Section 2 of the ID Act?

(II) Whether,

(a) Sundays and holidays during the period of service could be counted within 240 days as per the applicable
Standing Orders so as to make up aggregate service of 240 days in a year within the meaning of the Standing
Orders and

(b) such 240 days should be reckoned as forming part of the calendar year of 12 months immediately preceding
the dates of termination?

(III) Should a Labour Court dealing with terminations of workmen in a reference under the ID Act refuse to
consider their claim of permanency?

The two factual aspects here are as follows:

• Whether for inquiry Court can simply focus on the last termination of each of these workmen
and disregard their earlier engagements and terminations?

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 • Rotational Pattern said to have been adopted for engagement of these workmen – whether such
pattern exists, for if it does, the legal question as to whether the terminations, including the
last, come within the definition of retrenchment under Section 2(oo) and not within the
excepting clause, namely, clause (bb) thereof

Analysis, Law and Decision

Clause (bb) as referred above applies to two situations:

• where the termination is a result of non-renewal of the contract of employment between the
employer and the concerned workman upon its expiry; and
• where such termination is the result of a contractual stipulation contained in the contract of
employment.
In the present case, the company’s is with regard to the contract made for a specific period and its non-renewal
upon expiry.

The respondent company employed a rotational scheme for more than 13 years.

A pool of temporaries is maintained and anywhere between four to eight thousand temporaries from
out of this pool are employed in rotation, some of them on 8 to 14 times, each time for a duration not
exceeding seven months.
The classical idea behind retrenchment has been surplusage. A fixed period contract, on the other hand, implies
either that for some particular work or project or due to a spurt in the demand and the resultant need for
increased activity, there is a special need for a certain employee or number of employees and accordingly,
need for a contract of employment for the particular work or project, or for the particular fixed period.
Court notes in the present case to be perennial work, work which is no different from what is performed by
the permanent workmen of the company, for which temporaries were engaged. The said engagement was
found to be over 13 years.

Bench found that the employment of the workmen in the present case was neither for any particular work or
project nor was brought to an end after a fixed period due to wanting of work upon expiry of the period of
contract.

The engagements were brought to an end purportedly at the expiry of the stipulated period of contract
only to see that they get an artificial break (during which others from the waiting list were employed)
only to be re-employed and this went on – again and again.

High Court in view of the above discussion stated that the above pattern appeared to have been designed with
a view to avoiding any legitimate claim of permanency of tenure on the part of workmen concerned.

Deprivation of Status and Privileges of Permanent Employees

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Clear recipe of an unfair labour practice, notorious in the industry, of employing ‘badlis’, casuals or
temporaries and continuing them as such for years, with the object of depriving them of the status and
privileges of permanent employees.

Nature of Engagement of Workmen

Whether on a fixed tenure contract or colourable engagement on a fixed term, the real engagement being on a
long term basis by adopting a rotational pattern, so as to avoid any claim of permanency.

Bench in view of the evidence recorded, held that the conclusions of the Labour Court, simply rendered as
tag-lines, that there was no rotational pattern, or that it could not be said that service of anyone temporary
workman was terminated and in his place and category another was employed offended the Wednesbury
Principles and could not stand the scrutiny under Articles 226 or 227 of the Constitution of India.

Whether the workmen were illegally retrenched; whether, by reason of their employment (i.e. the last
employment) being for a fixed tenure, their retrenchment formed an exception to the main part of Section
2(oo) of the ID Act, by falling within clause (bb) thereof.

High Court expressed that it cannot be gainsaid that both parties, being fully aware of the terms of reference
and its scope, made their cases in extenso on the aspects of past engagements of the concerned workman in a
rotational pattern and artificial breaks given to them so as to avoid completion of 240 days of continuous
service and these were very much part of the trial before the Labour Court. It was thus clearly within the remit
of the reference court to decide the issue.

Adding to its observations Court held that neither on principle nor on authority, these workmen were liable to
be made permanent under Standing Order 4C by reason of completion of 240 days of continuous service in
twelve preceding calendar months within the meaning of Standing Order 4C, therefore, issue no. (II) was
decided against the petitioners.

Issues (I) and (III) were decided in favour of the petitioners, in light of which the impugned labour court
awards were to be quashed and set aside.

Further, the Bench added that considering that the terminations challenged took place in the year 1997/98,
more than twenty long years back, it would not be in the interest of justice to remit the references to the Labour
Courts for consideration of monetary relief in lieu of reinstatement.

Therefore, the Court proposed to consider monetary relief in lieu of the reinstatement based on the material
produced before the Court.

Bench relied upon the case of Bajaj Auto Ltd. v. Bhojane Gopinath D, (2004) 9 SCC 488 as a model for
determining compensation.[Sunil Pralhad Khomane v. Bajaj Auto Ltd., 2021 SCC OnLine Bom 129,
decided on 01-02-2021]
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 CONCLUSION

IMPORTANT AUTHORITIES UNDER THE LABOUR LAW IN INDIA

1. Ministry of Labour and Employment, Government of India

2. Organisation of the Chief Labour Commissioner (CLC)

3. Labour Courts / Industrial Tribunals

Most of the labour disputes are referred to the Labour Courts/ Industrial Tribunals through the Department of
Labour under the respective State Government. The process for labour dispute starts with filing of a petition
before Labour Conciliation Officer and in case no compromise is possible, the said officer sends a failure
report to the Government. After consideration of the said report, the Government may send a reference to the
Labour Court/Industrial Tribunal. In certain matters, the labour dispute can be directly filed in the court
concerned.

Matters that fall within the jurisdiction of Labour Courts.

1. The propriety or legality of an order passed by an employer under the standing orders

2. The application and interpretation of standing order

3. Discharge or dismissal of workmen including re‐instatement of, or grant of relief to, workmen wrongfully
dismissed.

4. Withdrawal of any customary concession or privilege

5. Illegality or otherwise of a strike or lock‐out; and

6. All matters other than those being referred to Industrial Tribunals.

Stages of adjudication in labour or industrial disputes

The first is receiving a reference from the appropriate Government or filing of the labour dispute in the Labour
Court. The next step is sending notice to the Management and after filing of the response by them, the matter
is fixed for adjudication. The fourth step is recording the evidence of the parties and hearing the arguments.

The final conclusion of the dispute

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After hearing the parties, the Labour Court/Industrial Tribunal decides the dispute and the said final decision
is called an Award. A copy of the award is to be published by the Labour Department as per rules. Copies of
the same are also sent to the parties concerned.

Execution of Awards

In case the management does not comply with the terms of the award, the workman may pray for its execution
by moving an application before the concerned Conciliation Officer.

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 BIBLIOGRAPHY

www.google.com

www.indiankanoon.org

www.lawyerservices.in

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