UNIVERSITY INSTITUTE OF LEGAL STUDIES

PANJAB UNIVERSITY

A Project Report submitted as a part of the curriculum of B.Com.

LLB(Hons.) in the
subject of Labour Law

TOPIC : Constitutional aspect of Right to Association and Trade Union

Act, 1926.

SUBMITTED TO: SUBMITTED BY:

Ms. Manika Rashi Kapil
194/18
B.Com. LLB(Hons)
Section D

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 ACKNOWLEDGEMENT
The success and final outcome of this project required a lot of guidance and assistance and I
am extremely privileged to have got this all along the completion of my project. All that I
have done is only due to such supervision and assistance.
I respect and thank Ms.Manika for providing me an opportunity to do the assignment and
giving me all support and guidance, which made me complete it duly. I am extremely
thankful to her for providing such a nice support and guidance till the completion of my
assignment by providing all the necessary information.
I am thankful to and fortunate enough to get constant encouragement and support.

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TABLE OF CONTENTS

 Introduction.........................................................................................................................4
 Laws governing trade unions in India.................................................................................5
 Landmark cases pertaining to trade unions.......................................................................10
 Conclusion.........................................................................................................................11

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 Introduction
Before the emergence of industrialization on a massive scale, there were personal
contracts between workers and employers. Therefore, no requirement for the
evolution of any machinery governing the relationship between workers and
employers arose until then. But after the establishment of the modern factory system,
this relationship lost its significance due to large-scale industrialization, which
enticed employers to reduce the cost of production in order to withstand the cut-throat
competition in the market and maximise their profit by using technologically more
sophisticated means of production. This in turn resulted in the rise of a new class of
workers who were completely dependent on wages for their survival, which changed
the existing employer-and-employee relationship in which the employees were
exploited by their employers. The conflict of interest between workers and employers
and the distress of workers resulted in the growth of various trade unions.

A trade union is an organised group of workers who strive to help the workers on issues
relating to the fairness of pay, good working environment, hours of work, and other
benefits that they should be entitled to instead of their labour. They act as a link between
the management and the workers. In spite of being newly originated institutions, they
have turned into a powerful force because of their direct influence on the social and
economic lives of the workers. To control and manage the work of these trade unions,
different legislation regulating the same is required. In India, the Trade Unions Act of
1926 is a principal Act for controlling and managing the work of trade unions. The
present article aims at explaining and bringing forth various aspects of the Act.

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 Laws Governing Trade Unions in India

In India, the right to form and join a trade union, and engage in collective bargaining
is provided for under national and state-specific legislations. Time and again, the
courts have upheld the right of workers to form or join a trade union in India 1.

I. Constitution of India,

Article 19(1)(c) of the Constitution of India, 1950 (“Constitution”) which envisages

fundamental right to freedom of speech and expression also guarantees the
country’s citizens the right “to form associations or unions” including trade unions. 2
The SC has held that the right guaranteed in Article 19(1) (c) also includes the
right to join an association or union. This right carries with it the right of the State
to impose reasonable restrictions.3

Right to make an association

The right bound to form associations or unions is more or less a charter for all
working people class during this nation. Union activity wasn’t only restricted by most
of the Western nations until comparatively recently, but in many nations, it had been
even looked upon as an anti-social and anti-state consideration. Working-class had to
undergo great problems before they might obtain even the elementary rights that
vitally affected their existence as a separate group or class in social norms. it had
been only in the 20th century, particularly after the primary war, that any significant
measure was imposed on the state to make sure the legitimate rights of the working-
class through labour and industrial legislation. To urge these rights fundamental and
embody them intrinsically in the Constitution was indeed a way bolder breakthrough.
Fully recognizing the recent trend of these times, the Constitution of India has made
the labour right to make the association a fundamental one.

The right to make associations or unions are often stopped only in the interests of public
order or values there are often no association or union for an unethical or
conspiratorial manner. Interpreting the scope of the proper the Supreme Court held in the
case of State of Madras vs. V.G. Rao “The right to make associations or unions has
such wide and varied scope for its exercise and its curtailment are fraught with such
potential reactions in the religious, political and economic fields. That the vesting of
authority in the chief government to impose restrictions on such right, without
allowing the grounds of such imposition, both in their factual and legal aspects, to be
duly tested during a judicial inquiry, is a robust element which, in our opinion, must
be taken under consideration

1
All India Bank Employees’ Association v. N.I.Tribunal, AIR 1962 SC 171
2
Ibid

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3
Article 19(4) of the Constitution

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in judging the reasonableness of the restrictions imposed on the exercise of the
elemental right under Article 19 (1) (c)”

Right to make Association:

 It is a fundamental Right given in the Constitution of India under Article

19(1)(c).
 It proclaims that each one citizen shall have the freedom to make associations
or unions for a lawful purpose.
 The right to make associations indicates that several individuals get together
and form voluntarily an association with a standard aim, legitimate purpose, and
having a community of interest.
 It is not an absolute Right rather it’s certain Reasonable Restrictions.

The right to make associations or unions, however, is not available to each citizen in
an equivalent measure. A member of the general public services, although he’s a
citizen, cannot claim the proper to the extent that a personal citizen can.

Reasonable Restriction

Like any other Fundamental Right under Article 19, the proper to the association is
additionally not absolute and is subjected to regulation in social interest. Article 19(4)
specifically empowers the state to form any law to fetter, abridge, or abrogate any of
the rights under Article 19(1) (c). Clause (4) empowers the state to impose reasonable
restrictions on the exercise of Right to make Association, in the interest of the
sovereignty and integrity of India, Public order and Morality,

Essential Elements of Restriction

 It is often imposed only by the authority of law.
 The restriction must be Reasonable.
 The restriction must be associated with the aim specifically mentioned in Clause
4.
 Judiciary has the facility to check the validity of those Restrictions on two
grounds: whether the restriction is cheap, and whether it is for the aim
mentioned in the clause under which the restriction is being imposed.

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II. Trade Unions Act, 1926

Trade union is based on the concept of collective bargaining. According to

International Labour Organisation collective bargaining is a fundamental right
and accepted as part of right to work under ILO declaration on fundamental
principles and right to work (1998). The concept of collective bargaining is
recognised by the constitution of India.4 The International Labour Organisation
convention no. 154 has defined collective bargaining as negotiation between the
employer and the worker’s union in respect of working conditions or terms of
employment.

The Constitution of India is the country’s main legislation.

The Constitution of India protects and promotes the right to collective bargaining
under article 19 of the constitution of India under to significant provisions:

a. Freedom of speech and expression: Article 19(1)(a) provides the right to

freedom of speech and expression which is one of the most important
fundamental rights which provide every citizen to express their views or
to express dissent. Thus, every citizen has the right to speech and
expression, which can be exercised individually or in groups.

b. The right to form an association or union: Article 19(1)(c) provides the right
to form an association or union which can be said to the foundation of the
trade unions in India.

The Trade Unions Act, 1926 (“TU Act”) provides for formation and registration
of trade unions and in certain respects to define the law relating to registered trade
unions. The TU Act defines a trade union as “any combinations, whether temporary
or permanent, formed primarily for the purpose of regulating the relations
between workmen and employers or between workmen and workmen, or between
employers and employers, or for imposing restrictive condition on the conduct of
any trade or business, and includes any federation or two or more trade unions.”5
All workmen have the right to form a union or refuse to be a member of any
union. However, not all workers’ organizations are considered trade unions. For
example, the Madras High Court has held that an association of sub-magistrates
of the judiciary, tahsildars, etc., is not a trade union because the members are
engaged in sovereign and regal functions of the government.6

4
Article 19(1)© of the constitution of India
5
Section 2, Trade Union Act, 1926

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6
Tamil Nadu NGO Union v. Registrar, Trade Unions (AIR 1962 Mad High Court)

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 A. Recognition and Registration

Although no specific right is granted to any trade union with respect to the
right to be recognized, it has become crucial in India to develop a mechanism
wherein a trade union is recognized formally by the employer. Recognition is the
process through which the employer accepts a particular trade union as having
a representative character and hence, will be willing to engage in discussions with
the union with respect to the interests of the workers.7 This process is
important so as to ensure smooth collective bargaining and stability of industrial
relations. On the other hand, registration of a trade union carries certain
inherent benefits with it. A registered trade union is deemed to be a body
corporate, giving it the status of a legal entity that may, inter alia, acquire and
hold property, enter into contracts, and sue others.8 A registered trade union is
also immune from certain contractual, criminal and civil proceedings.9
However, registration is optional and not mandatory. Generally, registration
of trade unions under the TU Act does not automatically imply that a particular
trade union has gained recognition status granted by the employer. Unless
different Indian states have specific legal provisions pertaining to recognition of
trade unions, it is generally a matter of agreement between the employer and
trade union. Ideally, a trade union must obtain legitimacy through registration
under the TU Act and then seek recognition as a sole bargaining agent either
under the appropriate law or an employer-employee agreement.

B. Registration Process

The TU Act provides for the registration of trade unions with the Registrar of
Trade Unions in the concerned territory (“Registrar”) but such registration is
not compulsory. It is also possible for more than one trade union to be registered
in relation to the same employer. Registration requires that at least seven
members subscribe to the union rules. 10 In addition, at least 10% of the
workforce or 100 workers, whichever is less, engaged or employed in the
establishment, must be members of the trade union connected with such
establishment at the time of application. 11 Registration of a trade union is

7
Singh et al., Employee Relations Management, p. 110, Available at https://books.google.co.in/books?
id=vkQ7BAAAQBAJ&printsec=frontcover (Accessed on January 22, 2019)
8
Section 13 of the TU Act
9
Sections 17, 18 and 19 of the IDA
10
Section 4, Trade Unions Act, 1926
11
Ibid

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 subject to the Registrar’s satisfaction that all primary requirements of the TU
Act have been complied with. The Registrar, in deciding whether to grant
registration, must base its decision on whether the technical requirements of
registration are being fulfilled, and not whether the trade union could be
described as lawful. If the Registrar fails to register a trade union within three
months of application, an appeal can be made to the High Court under Article
226 of the Constitution.

C. Process of Recognition of Trade Unions

Some Indian states have enacted legal provisions setting forth rules and
principles for the recognition of trade unions, each with their own criteria. It is
pertinent to note that there is no law at the national level for recognition of
trade unions in India. Although there is a proposal53 in the pipeline which
will allow trade unions to make an application for being recognized by the
central or state governments. The various state legislations governing trade
unions are as follows: ɵ Maharashtra Recognition of Trade Unions and
Prevention of Unfair Labour Practices Act, 1971 ɵ West Bengal Trade Unions
Rules, 1998 ɵ Kerala Recognition of Trade Unions Act, 2010 ɵ Orissa
Verification of Membership and Recognition of Trade Union Rules, 1994
Generally, these rules provide that a union shall be recognized by the employer
as the sole bargaining agent of a group of workers if it receives a specified
minimum percentage (usually a majority) of these workers’ votes via secret
ballot, organized by the Registrar. However, every trade union receiving a
smaller minimum percentage of votes (fifteen or ten percent, depending on the
type of industry) shall also be recognized as constituents of a joint bargaining
council as in the case of Kerala trade unions.54 At present, recognition of
trade unions functioning in industrial establishments is regulated under the
provisions of the voluntary ‘Code of Discipline’(“Code”) and the ‘Criteria for
Recognition of Unions’ appended to the Code adopted by the Standing Labour
Committee in its 16th Session in 1957 and subsequently ratified by the
representatives of Employers and CTUOs at the 16th Session of the Indian
Labour Conference, held in 1958. The Code is a set of guidelines mutually
and voluntarily accepted by all parties to maintain discipline in industry, both
in public and private sectors. Clause III (vii) of the Code states that the
management agrees to recognize the Union in accordance with the criteria
evolved in the Code.

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Landmark Cases Pertaining to Trade Unions
There are various cases that have played a major role in interpreting and shaping the
law on trade unions in India. A few of these cases have been mentioned below:
a. The case of All India Bank Employees’ Association v. N.I.Tribunal 12
laid down the rights of the members of the trade unions that are
encompassed within the fundamental right to freedom of expression and
speech, i.e. Article 19(1)(c)13:
• The right of the members of the union to meet,
• The right of the members to move from place to place,
• The right to discuss their problems and propagate their views, and
• The right of the members to hold property,
However, the case held that Article 19(1)(c) does not account for a
right pertaining to the achievement of the all the objectives for which the
trade union was formed. Say for example, if one of the objectives for
formation of trade union was to push the employer for raising the wages,
the trade union cannot, as a matter of right, ask the employer to fulfil
the objective of increasing wages of the workers. The case also stated
that strikes by trade unions may be controlled or restricted by
appropriate industrial legislation.

b. Another case which is of much importance is the case of B. Srinivasa Reddy

v. Karnataka Urban Water Supply & Drainage Board Employees’
Association14 wherein it has been held that an unregistered trade union or a
trade union whose registration has been cancelled has no rights either
under the TU Act or the IDA. This case highlights the importance with
respect to registration of trade unions.

c. In the case of B.R Singh v. Union of India15 the court has recognized “strike”
as a mode of redress for resolving the grievances of workers.

d. In MRF United Workers Union rep. by its General Secretary v. Respondent:

Government of Tamil Nadu rep. by its Secretary, Labour and Employment
Department and Ors.,16 the court has highlighted the validity of procedure
for recognition of a trade union. When the State government accepts a
particular procedure for recognition, it shall direct the Labour
Commissioner to call upon two unions to submit their membership details

12
All India Bank Employees’ Association v. N.I.Tribunal, AIR 1962 SC 171
13
Constitution of India
14
B. Srinivasa Reddy v. Karnataka Urban Water Supply & Drainage Board Employees’ Association , (2006) 11 SCC
731 (2)
15
B.R Singh v. Union of India ,(1989) 4 SCC 710
16
[2010(124)FLR386], (2009)IVLLJ685Mad, 2009WritLR881

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 as per the Code of Discipline. Subsequently, the Labour Commissioner shall
decide as to which Union is a true representative union of workmen and give
it a genuine recognition. Further, the court cannot permit management to
claim that the Union which shows larger membership after recognition
will not be recognized by management.

Conclusion

Historically, in India, the function of the trade unions was limited largely to
collective bargaining for economic considerations. However, trade unions now play
a major role in employee welfare activities, cultural programs and banking and
medical facilities and by creating awareness through training and educating the
members of the trade union. On the other hand, the dominant managerial
objectives in collective bargaining in recent years owing to heightened
competition have been to reduce labour costs, increase production or productivity,
flexibility in work organization (multi-skilling /multifunctioning, changes in
worker grades etc.), increase in work time, reduction in regular staff strength via
VRS, stress on quality and so on. Despite certain recent developments which may
be largely considered as one-off incidents, most trade unions have managed to
foster an environment so as to enable a healthy discussion between the workers
and employers with respect to any demands the workers may have. Furthermore,
trade unions in India have, over the period of time, ensured to provide a forum to
facilitate better industrial relations, industrial growth and improve productivity.