UNIT-2

A) CONCEPT AND NATURE OF STANDING ORDERS

According to Section 2(g) of The Industrial Employment (Standing Orders) Act, 1946, the expression
“Standing Orders” means rules relating to matters set out in the Schedule of the Act. The following matters
should according to the Schedule be provided in Standing Orders under this Act:
(1) Classification of workmen, e.g., whether permanent, temporary, apprentice, probationers or badlis,
fix term employment.
(2) Manner of intimating to workmen periods and hours of work, holidays, pay days and wage rates.
(3) Shift working.
(4) Attendance and late coming.
(5) Conditions of procedure in applying for and the authority which may grant leave and holidays.
(6) Requirement to enter premises by certain gates and liability to search.
(7) Closing and reopening of sections of the industrial establishment and temporary stoppages of work
and the rights and liabilities of the employer and workmen arising therefrom.
(8) Termination of employment and the notice thereof to be given by employer and workmen.
(9) Suspension or dismissal for misconduct and acts or omissions which constitute misconduct.
(10) Means of redress for workmen against unfair treatment or wrongful exactions by the employer or
his agents or servant.
(11) Any other matter which may be prescribed.

It shall be obligatory upon the employer to make provision in the Standing Order in respect of any matter
provided in the Schedule of the Act. Once a provision is made it can be modified only in accordance with
the provision of Section 10(2) of the Act.

The word ‘condition’ in clause (5) of the Schedule has to be interpreted in a broad and liberal sense. The
dictionary meaning of the word “condition” is a provision or a stipulation. Thus construed conditions of
leave and holidays means a provision for the quantum of leave and holidays.

The expressions “termination of employment” and “notice thereof to be given by employer and workmen”
in clause (8) of the Schedule are to be read disjunctively. They comprise two distinct but connected matters
and the latter does not qualify the former. Termination of employment would be the principal or primary
subject, notice in relation thereto would form an ancillary or subsidiary subject.

It was held in S.K. Ghosh vs. Chairman O.S.E. Board, that the clause ‘termination of employment’ in item
8 of the Schedule and the word ‘superannuation’ cannot be equated. The former is a positive act by which
one party, even against the desire of the other, can bring about the end to an employment, while the latter is
an event which comes more or less in an automatic process. An age is fixed on the reaching of which the
holder of an office is required to go out of the office. There is no volition in the Act.

It was held in New Victoria Mills Co. Ltd. vs. Presiding Officer Labour Court, that the misconduct for
which an employee may be dismissed need not necessarily have been committed in the course of his
employment. Therefore, a workman employed as a sweeper who has either been proved to have committed a
theft or to have so acted as to facilitate or aid theft may be guilty of such misconduct as to justify his
dismissal. All that has to be shown is that the misconduct affects the competence of the employee for the
particular kind of work he does.

It was held in Glaxo Industries (P) Ltd. vs. Labour Court Meerut and Others, that the act of misconduct
which forms a basis for punishment must however, be one enumerated in the standing orders of the
establishment. Punishment for an act which is not enumerated in the standing orders of the establishment is
wholly illegal.

The Standing Orders provide for giving opportunity to workers to offer explanation before imposing
punishment of dismissal. It was held in Associated Cement Companies Ltd. vs. T.C. Srivastava and
Others, that neither under the ordinary law of the land nor under the industrial law a second opportunity to
show cause against the proposed punishment is necessary. This does not mean that a Standing Order may
not provide for it, but unless the standing order provides for it, either expressly or by necessary implication,
no inquiry which is otherwise fair and valid will be vitiated by non-affording of such second opportunity.

It was held in Co-op Cr. Bank vs. Ind. Tri. Hyderabad, that the conditions of employment can also be laid
down in any other manner that in Standing Orders. The employer and employee may enter into special
conditions of employment. In case of conflict between the statutory conditions of employment contained in
Standing Orders and the special terms contained in the written contract, the terms of former shall prevail all
over the latter. Such Standing Orders though binding between the employer and employees of industry, have
no force of law to be binding on Industrial Dispute.

It has been held in Western India Match Co. vs. Workmen, that the certified Standing Orders have a
statutory force. The Standing Order implies a contract between the employer and the workman. Therefore,
the employer and workman, cannot enter into a contract overriding the statutory contract as embodied in the
certified Standing Orders. While the Standing Orders are in force it is not permissible for the employer to
seek their statutory modification so that there can be one set of Standing Orders in respect of certain
employees and another for the rest.

In Behar Journals vs. Ali Hasan, the probation period provided by the Standing Orders was for 3 months
only. But in the appointment letter of the respondent the period of probation was six months. It was held that
the certified Standing Orders have statutory force. It is not possible in law for the parties to enter into
contract overriding the Statutory Contract as embodied in the Standing Orders. Therefore, probationary
period in this case could not be for a period longer than 3 months.

B) SCOPE AND COVERAGE OF THE INDUSTRIAL EMPLOYMENT

(STANDING ORDERS) ACT, 1946

The absence of Standing Orders in establishment very often led to friction between the management and
workers in industrial undertakings in our country. Before passing of this Act the conditions of employment
were governed by contracts either express or implied between the employers and their employees in
different industrial undertakings. In many cases these conditions were not well defined and suffered from
doubt and ambiguity.

The importance of making a law defining precisely the conditions of employment was emphasised during
discussions in the Tripartite Labour Conferences. To give effect to the new ideology the Industrial
Employment (Standing Orders) Act, 1946 was enacted by the Central Government. It is obligatory upon all
the employees covered by this Act to define conditions of employment under them. The conditions of
employment must also be made known to workmen employed by such employers. The Preamble of the Act
makes it amply clear that the Standing Order shall deal with the “conditions of employment of workers in
industrial establishment”.

The Act applies to every industrial establishment:

(1) Situated within the Indian Union,
(2) Employing 100 or more workmen on any day of the preceding 12 months.

The appropriate Government may be a Gazette notification apply the Act to any Industrial establishment
employing such number of persons as specified in the notification. The number of employees fixed by the
Government may be less than 100. But the Appropriate Government must give two months’ prior notice of
its intention to make any such extension of the Act.

The Act does not apply to the following establishments:

(1) Any industry to which the provisions of Chapter VII of the Bombay Industrial Relations Act, 1946
apply,
(2) Any industrial establishment to which the provisions of the MP Industrial Employment (SO) Act,
1961 apply:
Provided that notwithstanding anything contained in the Madhya Pradesh Industrial Employment (Standing
Orders) Act, 1961, the provisions of this Act shall apply to all industrial establishments under the control of
the Central Government.

It was held in Avery India Ltd. vs. Second Industrial Tribunal, West Bengal, that the provisions as to the
age of retirement in the standing orders of an establishment would apply to all employees irrespective of
whether they entered into service prior to or subsequent to the coming into force of the standing orders and
even though there was no such provision for retirement in the past.

In Narendra Pal Gahlot vs. State of Uttar Pradesh, it was held that this Act contains, a general provision
requiring employers in the industrial establishments to define terms and conditions of the employment under
them and to make such terms and conditions known to the workmen employed by them, from the very
beginning.

In Bharat Petroleum Corporation Ltd. vs. Maharashtra General Kamgar Union, the Supreme Court
explained the object of Industrial Employment (Standing Orders) Act, 1946 and stated that it was made by
the Parliament to require employers of all industrial establishments to define formally the conditions of
employment on which the workmen would be engaged. The object underlying the Act, which is beneficent
piece of legislation is to introduce uniformity of terms and conditions of employment in respect of workmen
belonging to the same category and discharging the same and similar work under the industrial
establishment and to make the terms and conditions of industrial employees well settled and known to the
employees before they accept employment.

Section 13-B limits the application of the Act against such workmen employed in any industrial
establishment as are covered by the following rules and regulations:
(1) The Fundamental and Supplementary Rules,
(2) The Civil Service (Classification, Control And Appeal) Rules,
(3) The Civil Services (Temporary Service) Rules,
(4) The Revised Leave Rules,
(5) The Civil Services Regulations,
(6) The Civilians Defence (Classification, Control And Appeal) Service Rules,
(7) The Indian Railway Establishment Code, or
(8) Any other Rules or Regulations that may be notified in this behalf by the appropriate Government in
the Official Gazette.

Section 14 of the Act authorises the appropriate Government to exempt conditionally or unconditionally any
industrial establishment or class of industrial establishments from all or any of the provisions of this Act.
But the question that arose before the Court in Raman Nambisan vs. Madras State Electricity Board, was
whether the power to exempt any industrial establishment would include the power to exempt a section of
the industrial establishment also. It was held that Section 14 enables the Government to exempt any
industrial establishment or class of industrial establishments from all or any provisions of the Act and not a
section of the industrial establishment.

Salient features of the Act: The following are some of the main features of the Industrial Employment
(Standing Orders) Act, 1946:
(1) The definition of workmen under this Act includes a “Supervisory Technical Personnel” under
certain conditions.
(2) The certifying officer is empowered to modify or add to the draft Standing Orders so as to render
them certifiable under the Act.
(3) A group of employers of similar industrial establishments may submit joint Standing Orders for
certification.
(4) This Act normally applies to every industrial establishment wherein 100 or more workmen are
employed.
(5) The certifying officers and appellate authorities shall have all the powers of a Civil Court in respect
of certain matters provided in Section 19 of the Act.
(6) The employer can be penalised for failure to submit draft Standing Order for certification or for
contravention of any provision of Standing Order finally certified.
(7) The appropriate Government may be a Gazette notification exempt any establishment or class of
industrial establishments from any of the provisions of the Act.

C) CERTIFICATION PROCESS

The aim and objective of drafting a standing order and its certification are to regulate the terms and
conditions of employment. The process provides that, after certification, the order will be binding on the
employees in that employment.

i) PROCEDURE FOR CERTIFICATION

Section 3 of the Act states that within six months from the date on which this Act becomes applicable to an
industrial establishment, the employer shall submit to the Certifying Officer five copies of the draft standing
orders proposed by him for adoption in his industrial establishment.
Provision shall be made in such draft for every matter set out in the Schedule which may be applicable to the
industrial establishment, and where model standing orders have been prescribed, shall be, so far as is
practicable, in conformity with such model.
The draft standing orders submitted under this section shall be accompanied by a statement giving
prescribed particulars of the workmen employed in the industrial establishment including the name of the
trade union, if any, to which they belong.
Subject to such conditions as may be prescribed, a group of employers in similar industrial establishments
may submit a joint draft of standing orders under this section.

In SK Sheshadri vs. HAL and Others, the validity of the Standing Order which was made unduly lending
in the company premises a misconduct was challenged as violative of Article 14 of the Constitution. The
said Standing Order was held not to be discriminatory. It was further held that as long as the Standing
Orders fall within the Schedule to the Act, they would not be invalid or ultra vires because they contain
additional provisions not provided for in the Model Standing Orders.
It was held in UP State Sugar Corporation and Another vs. Bipin Kumar Mishra, that there is no
requirement under the Act to frame standing order in respect of transfer, hence the employer cannot be
denied that normal right to transfer an employee from one place to another. The employer cannot also be
denied the right to frame rules and regulations relating to transfer of employees.

Section 5 of the Act provides that when the draft Standing Orders is submitted to the Certifying Officer he
shall forward a copy of it to Trade Union, if any, of the workmen or where there is no Trade Union to the
workmen in such manner as may be prescribed together with the notice in the prescribed form requiring
objections, if any, which the workmen may desire to make to the draft Standing Orders.
The workmen or the Trade Union is required to submit the objections to the Certifying Officer within 15
days from the receipt of the notice.
The Certifying Officer shall give the employer, Trade Union or the representatives of the workmen
opportunity of being heard.
He shall, thereafter, decide whether any addition or modification in the draft Standing Orders is necessary or
not to render it certifiable under the Act and shall make an order in writing.
The Certifying Officer shall, after making modification, if any, certify the draft. He shall, within 7 days from
the certification of the draft, send certified copies of it duly authenticated in the prescribed manner and of his
order under section 5(2) to the employer, Trade Union or other prescribed representative of the workmen.

The purpose of framing the Standing Orders and getting them certified by the Certifying Officer is that the
conditions of service of that employment shall be regulated by it. The manner in which the Standing Orders
are made and certified suggests that the Standing Orders, when certified, will be binding on the employees,
who are at the time in the service of the employer.

It was held in Barauni Refineries PSP vs. Indian Oil Corporation Ltd and Others, that no modification
in Standing Orders is permissible when a settlement relating to that matter is in operation. Since in the
course of settlement, the demand in respect of age of retirement was not acceded to, the modification of
Standing Orders raising the age of superannuation from 58 years to 60 years would throw additional
financial burden and as such will be in violation of settlement and, therefore, no such modification can be
made.

It was held in Uptron India Ltd. vs. Shammi Bhan, that any clause in the certified standing orders
providing for automatic termination of service of a permanent employee, not directly related to “Production”
in a factory or industrial establishment, would be bad if it does not prompt to provide an opportunity of
hearing to the employee whose services are treated to have come to an end automatically.

Section 8 states that a copy of all standing orders as finally certified under this Act shall be filed by the
Certifying Officer in a register in the prescribed form maintained for the purpose, and the Certifying Officer
shall furnish a copy thereof to any person applying therefore on payment of the prescribed fee.

Section 9 provides that the text of the standing orders as finally certified under this Act shall be prominently
posted by the employer in English and in the language understood by the majority of his workmen on special
boards to be maintained for the purpose at or near the entrance through which the majority of the workmen
enter the industrial establishment and in all departments thereof where the workmen are employed.

ii) APPEALS AGAINST CERTIFICATION

Section 6 of the Act provides that any employer, workmen, trade union or other prescribed representatives
of the workmen aggrieved by the order of the Certifying Officer under sub-section (2) of section 5 may,
within thirty days from the date on which copies are sent under sub-section (3) of that section, appeal to the
appellate authority, and the appellate authority, whose decision shall be final, shall by order in writing
confirm the standing orders either in the form certified by the Certifying Officer or after amending the said
standing orders by making such modifications thereof or additions thereto as it thinks necessary to render the
standing orders certifiable under this Act.
The appellate authority shall, within seven days of its order under sub-section (1), send copies thereof to the
Certifying Officer, to the employer and to the trade union or other prescribed representatives of the
workmen, accompanied, unless it has confirmed without amendment the standing orders as certified by the
Certifying Officer, by copies of the standing orders as certified by it and authenticated in the prescribed
manner.

There is no specific provision in the Act empowering an Appellate Authority to correct the mistakes in the
Standing Orders finally certified by it under Section 6(1) of the Act, before the expiry of 6 months from the
date on which the Standing Order or the last modification thereof came into operation in the manner
provided in Section 10 of the Act, that is except on an agreement between the employer and the workmen.

In Badarpur Power Engineers Association vs. Deputy Chief Labour Commissioner and Others, the
certified Standing Orders were dispatched on 7 January, 1991 and the appeal was filed on 6 February, 1991.
the question was whether the appeal was filed within the prescribed limitation period of 30 days. It was held
that in view of provisions of Section6 an appeal could be filed within 30 days from the date on which copies
of certified Standing Orders are sent. In this case the appeal was held to be filed within 30 days because 7
January was to be excluded in view of Section 9(1) of the General Clauses Act.

In Kerala Agro Machinery Corporation Ltd. vs. Industrial Tribunal and Others, the Appellate
Authority set aside certified standing orders and directed the Certifying Officer to consider the matter afresh.
This order was challenged in a writ and the Kerala High Court held that the power of the Appellate
Authority under Section 6 is to confirm the standing orders either in the form certified by the Certifying
Officer or by amending the same or by making such modifications or additions as it thinks necessary to
render the standing orders certifiable under the Act. The Appellate Authority has no power to set aside the
orders of the Certifying Officer and remand the matter for fresh disposal.

In BHEL Employees’ Association vs. Chief Labour Commissioner, the copy of certified Standing Orders
dated 31st December, 1984 was sent by registered post on 5th January, 1985 and the same was received on 7th
January, 1985. The Union sent the memorandum of appeal by registered post on 4 th February 1985 which
reached the appellate authority on 8th February, 1985. The appeal was rejected as barred by limitation. It was
held that the appeal was not time barred because the appeal papers sent on 4 th February, 1985, in the
ordinary course of post should have reached on or before 7 th February, 1985. Petitioner cannot be held
responsible for any delay caused in transit when it had used sufficient care to see that the papers were mailed
in time so that they could reach appellate authority in ordinary course of post. Consequently the appellate
authority was directed to dispose of the appeal on merits.

iii) CONDITIONS FOR CERTIFICATION

Section 4 provides that the standing orders shall be certifiable under this Act if:
(a) provision is made therein for every matter set out in the Schedule which is applicable to the
industrial establishment, and
(b) the standing orders are otherwise in conformity with the provisions of this Act,
and it shall be the function of the Certifying Officer or appellate authority to adjudicate upon the fairness or
reasonableness of the provisions of any standing orders.

The Certifying Officer or the appellate authority shall have the power to adjudicate upon the fairness or
reasonableness of the provisions of the Standing Orders. While doing so the Certifying Officer is directed to
consider and weigh the social interest in the claims of the employer and the demands of workmen.

The appellate authority or the Certifying Officer shall see whether the Standing Orders satisfy the conditions
necessary for certification. They can make necessary additions or modifications in draft Standing Orders
submitted to them for certification as as to make the draft certifiable under the Act.
Section 3 of the Act empowers the Certifying Officer or the appellate authority to enquire into the
impracticability to follow the Model Standing Order and Section 4 of the Act authorises them to adjudicate
upon the fairness or reasonableness of the draft Standing Order.

In Associated Cement Co. Ltd. vs. PD Vyas, the Certifying Officer modified the draft Standing Orders
submitted by the management and in respect of the Standing Order relating to the notice period for
discontinuance of a shift, he increased the notice period from 14 days to one month to bring it in conformity
with the Model Standing Orders. On similar grounds the Standing Orders relating to what amounted to
misconduct in relation to strikes and incitement to strikes was modified to include only illegal strikes. It was
held that the cumulative effect of the provisions of the Act is that the Certifying Officer has to be satisfied
that the draft Standing Orders deal with every matter set out in the Schedule and are otherwise in conformity
with the provisions of the Act.

The question is whether provision may be made in the Standing Orders in respect of any matter, which is
neither covered by any item of the Schedule nor by the Model Standing Orders but which is fair and
reasonable. In the Hindu vs. Its Secretary, the Madras High Court has held that there is no bar in making
provision in the Standing Orders about any matter which is not covered by the Schedule, but it is obligatory
to make provision with regard to matters covered by the Schedule.

In Rohtak and Hissar District Supply Co. Ltd. vs. State of UP, the Supreme Court has held that the
employer cannot insist upon adding a condition to the Standing Order which relates to the matter which is
not included in the Schedule.

The Supreme Court in UPE Supply Co. vs. TN Chatterjee, considered the question whether there can be
different conditions of service for different employees in the same industrial establishment. It was held that
the scheme and object of the Act clearly shows that it was not intended by the legislature that different sets
of conditions should apply to employees depending on whether a workman was employed before the
Standing Orders were certified or after. If the intention was otherwise it would lead to industrial unrest and
not industrial peace, the latter being the principal object of the legislation.

It was held in SK Ghosh vs. Chairman OSE Board, that the certification by the Certifying Officer of a
Standing Order containing a clause relating to the superannuation, neither covered by the Schedule to the
Act nor by the Model Standing Order cannot be valid certification and the failure of employees to challenge
such provision cannot add enforceability to it.

With regard to the fixing of age of superannuation by Standing Orders the Supreme Court in Jeewanlal Ltd.
vs. Workmen, observed that the present day tendency was to fix the age of superannuation generally at 60
years unless the Tribunal feels that the work of the operatives is particularly arduous or hazardous where
workmen may lose efficiency earlier.

iv) DATE OF OPERATION OF STANDING ORDERS

Section 7 states that standing orders shall, unless an appeal is preferred under section 6, come into operation
on the expiry of thirty days from the date on which authenticated copies thereof are sent under sub-section (3)
of section 5, or where an appeal as aforesaid is preferred, on the expiry of seven days from the date on which
copies of the order of the appellate authority are sent under sub-section (2) of section 6.

After a Standing Order comes into operation, it is binding upon the employer, all his employees presently
employed and also those, employed thereafter in the establishment. The right of the employees to challenge
the validity or propriety of such an order to claim modification in it by raising an Industrial Dispute cannot
be disputed. Further it is not open to the employer and the workmen to contract themselves out of the right
and obligations created by the Standing Order. Section 7 of the Act is subject to no limitations. Therefore,
the Standing Order after being certified must come into operation in accordance with Section 7 of the Act.

v) BINDING NATURE AND EFFECT OF CERTIFIED STANDING ORDERS

The certified standing orders are a legal document that is binding on both the employer and the employee,
and any breach of the standing orders constitutes misconduct by the employee.

The certified standing orders have been recognized by the Indian judiciary as a part of the contract of
employment between the parties. The Industrial Employment (Standing Orders) Act, 1946, provides the
statutory framework for the drafting and certification of the standing orders.

In India, Certified Standing Orders play an essential role in the industrial sector. It contributes to the
maintenance of law and order and fosters industrial discipline, which results in increased productivity and
efficiency. For the management, CSOs provide clarity in terms of the roles, responsibilities, and
expectations of the organization. They make decision-making more productive as employees may know
what is expected of them, and the employer may take disciplinary action in case an employee misconduct.

CSOs benefit the employees by providing them with a sense of security and certainty in regard to their
employment terms and conditions. Conditions of work, pay scale, work hours, leave policy, job security, and
grievance redressal mechanisms are laid down in a straightforward language accessible to all employees.

Certified Standing Orders are a set of rules and regulations which are designed by employers to govern the
terms and conditions of employment of their employees. These orders are mandatory in nature and provide
an exhaustive list of the rights and obligations of both the employer and employee. The primary objective of
certified standing orders is to ensure that there is a clear demarcation of duties and responsibilities between
the employer and employee.

The Industrial Employment (Standing Orders) Act, 1946, mandates that all industrial establishments, which
employ a minimum of 100 workmen, must submit their draft standing orders to the certifying officer for
approval. The certifying officer is appointed by the State Government and must be satisfied that the standing
orders submitted by the employer are legally compliant and in accordance with the provisions of the Act.
The certifying officer may make modifications to the draft standing orders if they are found to be non-
compliant with the provisions of the Act, and the employer must incorporate these changes in the final
standing orders. Once the standing orders have been certified, they become binding on both the employer
and the employees. The certified standing orders set out the terms and conditions of employment, such as
leave entitlements, working hours, termination of employment, etc.

A certified standing order is a legal document that governs the terms and conditions of employment and
regulates the working conditions of industrial workers. The standing orders are drafted by the employer in
consultation with the employees or their representatives. The standing orders are then submitted to the
certifying officer for certification of the document. The certifying officer verifies whether the standing
orders conform to the provisions of the Industrial Employment (Standing Orders) Act, 1946, and once
satisfied, issues a certificate of approval.

The certified standing orders are binding on both the employer and the employee. They can be used to
resolve disputes between the employer and the employee or between two employees. The certified standing
orders can also be used as evidence in any legal proceedings.

The certified standing orders have several effects on the relationship between the employer and the
employee.

Firstly, they provide certainty and predictability in the employment relationship. The employees are aware
of their rights and duties, and their expectations are predefined. Similarly, the employer knows the
expectations of the employees, which leads to a smooth functioning of the industrial establishment.

Secondly, the certified standing orders regulate the conduct of the employees. They provide guidelines for
the employees to follow, which leads to a harmonious working environment. The certified standing orders
also provide guidelines for the management to follow, which lead to a fair and just treatment of the
employees.
Thirdly, the certified standing orders provide a framework for resolving disputes between the employer and
the employee or between two employees. The standing orders provide a mechanism for resolving disputes
through conciliation, which can be exercised by the employer, the employee, or a conciliator appointed by
the state government.

The effect of certified standing orders is that they become binding on both the employer and the employee.
The provisions of certified standing orders prevail over any other terms of employment which may be in
conflict with the standing orders. Any contravention of the certified standing orders by either the employer
or the employee may lead to disciplinary action being taken against them.

Certified standing orders also provide a sense of security to both the employer and the employee as they
provide a clear framework for the functioning of the workplace. They ensure that there is uniformity in the
terms and conditions of employment and prevent arbitrary or discriminatory treatment of employees.

The Supreme Court of India, in the case of Management of Punjab National Bank v All India Punjab
National Bank Employees Federation and Others, held that the certified standing orders are not only
binding on the employer and the employees but also on the trade unions representing the employees. The
standing order must be adhered to in letter and spirit by all parties concerned.

In the case of Delhi Transport Corporation v Dal Chand Yadav & Ors, the Supreme Court held that the
certified standing orders are a part of the contract of employment between the employer and the employee.
Any change in the standing orders must be done in accordance with the provisions of the Industrial
Employment (Standing Orders) Act, 1946, and with the mutual agreement of the employer and the employee.

The binding nature of certified standing orders has been established in various cases. In the case of Y M
Raja Ram v. S Muthu Kumar, it was held that certified standing orders were binding on both the employer
and employee and any contravention of the same would lead to disciplinary action against the concerned
party. The Court further held that employees could only be dismissed in accordance with the provisions of
the certified standing orders and not otherwise.

In the case of Hindustan Steel Ltd. V. The Presiding Officer, Labour Court, it was held that certified
standing orders override any other terms of employment which are in conflict with the standing orders. It
was further held that any alterations in the certified standing orders must be made in compliance with the
provisions of the Industrial Employment (Standing Orders) Act, 1946.

The Industrial Employment (Standing Orders) Act, 1946, provides the legal framework for certified standing
orders in India. The Act defines a standard format for the standing orders policy and prescribes the process
of drafting and certifying them.

Further, various court cases have upheld the legal sanctity of the certified standing orders. In Express
Newspapers Ltd vs Its Workmen, it was ruled that standing orders provide an essential motive for
Industrial Relations by ensuring that both the employees and employers are aware of their rights and
responsibilities. It is also observed in Lakshmi Mills Company Limited (2014) where the court observed
that certified standing orders benefit both employers and employees by establishing mutually agreeable
work conditions and rules, reducing misunderstanding, and improving working relationships.

Moreover, the Code on Occupational Safety, Health, and Working Conditions Act, 2020, provides further
guidelines for the employers in regard to working conditions, safety measures, and compensation. The Code
applies to all workers, including casual, temporary, and contractual employees.

The Industrial Employment (Standing Orders) Act, 1946, provides the legal framework for drafting and
certifying the standing orders. The Act provides for the constitution of a certifying officer, the procedure for
certification, the period of validity of the certified standing orders, and the consequences of non-compliance
with the standing orders.

Section 10 of the Act provides that any contravention of the certified standing orders constitutes a
misconduct by the employee, which may lead to disciplinary action by the employer.
vi) POSTING OF STANDING ORDERS
(Covered in Section 9 above).

D) MODIFICATION AND TEMPORARY APPLICATION OF MODEL

STANDING ORDERS

Section 10 provides that the standing orders finally certified under this Act shall not, except on agreement
between the employer and the workmen or a trade union or other representative body of the workmen, be
liable to modification until the expiry of six months from the date on which the standing orders or the last
modifications thereof came into operation.
Subject to the provisions of sub-section (1), an employer or workman or a trade union or other representative
body of the workmen may apply to the Certifying Officer to have the standing orders modified, and such
application shall be accompanied by five copies of the modifications proposed to be made, and where such
modifications are proposed to be made by agreement between the employer and the workmen or a trade
union or other representative body of the workmen, a certified copy of that agreement shall be filed along
with the application.
The foregoing provisions of this Act shall apply in respect of an application under sub-section (2) as they
apply to the certification of the first standing orders.
Nothing contained in sub-section (2) shall apply to an industrial establishment in respect of which the
appropriate Government is the Government of the State of Gujarat or the Government of the State of
Maharashtra.

In Shahadara Saharanpur Light Railway Co. vs. SS Railway Workers Union, the Standing Order
relating to the termination of service of a permanent workman was modified requiring the employer to give
reasons and communicating the same to the workmen in addition to giving one month’s notice or one
month’s pay in lieu of notice. The modification was held to be fair and reasonable. But the modification of
the Standing Orders requiring the giving of second show cause notice at the stage of imposing punishment
of removal cannot be considered as fair and reasonable. It was held that Section 10 does not state that once a
Standing Order is modified and the modification is certified, no further modification is permissible except
upon proof that new circumstances have arisen since the last modification. An application for modification
would ordinarily be made where:
(1) A change of circumstances has occurred, or
(2) Where experience of the working of the Standing Orders last certified results in inconvenience,
hardship, anomaly, etc, or
(3) Where some fact was lost sight of at the time of certification, or
(4) Where the applicant feels that a modification will be more beneficial.

It was held in Salem Erode Electricity Distribution Company (P) Ltd. vs. Their Employee’s Union, that
under the present Act, if the workmen are dissatisfied with the operation of the existing Standing Orders
they can apply to the Certifying Officer for modification. Before the amendment of section 10 giving right to
the workmen to apply for any modification in the Standing Orders, the only course open to the workmen to
adopt for securing any modification in the existing Standing Orders was to raise an industrial dispute and
move the appropriate Government to refer the said the said dispute to the adjudication of the appropriate
Industrial Tribunal.

In SW Union vs. Chief Labour Commissioner, the Standing Orders in Bhilai Steel Plant applied two
different sets of leave rules to the employees depending upon the fact whether they were appointed prior to
or after April, 1960. An application under Section 10(2) for modification of Standing Orders so as to make
them uniform in application was made. The application for such modification was held to be maintainable
because uniformity of Standing Orders in application to all workmen was the essential attribute of Standing
Orders.
Section 12A provides that notwithstanding anything contained in sections 3 to 12, for the period
commencing on the date on which this Act becomes applicable to an industrial establishment and ending
with the date on which the standing orders as finally certified under this Act come into operation under
section 7 in that establishment, the prescribed model standing orders shall be deemed to be adopted in that
establishment, and the provisions of section 9, sub-section (2) of section 13 and section 13A shall apply to
such model standing orders as they apply to the standing orders so certified.
These provisions shall not apply to an industrial establishment in respect of which the appropriate
Government is the Government of the State of Gujarat or the Government of the State of Maharashtra.

In Voltas Limited vs. KD Kochargoankar and Another, the model Standing Orders were notified under
the Act and the petitioner had its own certified standing orders. Subsequently the model Standing Order was
was modified and Standing Order 4-C was added. It was held that every amendment to the model Standing
Orders does not per se become applicable to an industrial establishment which has its own certified Standing
Order. The only way in which the workmen could get the benefit of the modified model Standing Order
would be to get their own Standing Order amended and certified in accordance with the provisions of the
Act. Until such modification and certification is made they would continue to be governed by their certified
Standing Orders.

E) INTERPRETATION AND ENFORCEMENT OF STANDING ORDERS

Section 13A provides that if any question arises as to the application or interpretation of a standing order
certified under this Act, any employer or workman or a trade union or other representative body of the
workmen] may refer the question to any one of the Labour Courts constituted under the Industrial Disputes
Act, 1947, and specified for the disposal of such proceeding by the appropriate Government by notification
in the Official Gazette, and the Labour Court to which the question is so referred shall, after giving the
parties an opportunity of being heard, decide the question and such decision shall be final and binding on the
parties.

In ME & R Industries vs. Workmen, the question related to the interpretation of the Standing Order which
provided that ‘commission of any act subversive of discipline or good behavior within the premises or
precincts of the establishment’ by a workman shall amount to misconduct. It was held that the words “within
the premises or precincts of the establishment” refer not to the place where the act which is subversive or
discipline or good behavior is committed but where the consequence of such an act manifests itself. In other
words, an act, wherever committed, if it has the effect of subverting discipline or good behavior within the
premises or precincts of the establishment, it will amount to misconduct under the Standing Order.

It was held in VK Verma vs. Hindustan Machine Tools Ltd. & Another, that where provision is made in
the Standing Orders for deduction of wages for absence from duty, it cannot be said to be by way of penalty.
It was further held that habitual late attendance is a misconduct under Standing Orders and action of
management in taking disciplinary action besides deducting wages is legal and proper.

In Ram Asrey and Others vs. Labour Court II Kanpur and Another, the petitioners had assaulted one
Junior Officer in front of the factory gate when he came out of the factory after finishing his day’s work. It
was held that assault amounted to misconduct being connected with the performance of the Junior Officer’s
duty and it is subversive of discipline and efficiency within the mill premises.

It was held in The Rajasthan State Road Transport Corporation and Another vs. Krishna Kant etc,
that the certified Standing Orders are not in the nature of delegated/subordinate legislation under the
Industrial Employment (Standing Orders) Act, 1946. after certification standing orders do not become part
of the Act. The constitute the conditions of service of the employees which are binding upon both the
employer and the employees.
F) PENALTIES AND PROCEDURE

The concerned provision is Section 13 which states that An employer who fails to submit draft standing
orders as required by section 3, or who modifies his standing orders otherwise than in accordance with
section 10, shall be punishable with fine which may extend to five thousand rupees, and in the case of a
continuing offence with a further fine which may extend to two hundred rupees for every day after the first
during which the offence continues.
An employer who does any act in contravention of the standing orders finally certified under this Act or his
industrial establishment shall be punishable with fine which may extend to one hundred rupees, and in the
case of a continuing offence with a further fine which may extend to twenty-five rupees for every day after
the first during which the offence continues.
No prosecution for an offence punishable under this section shall be instituted except with the previous
sanction of the appropriate Government.
No Court inferior to that of a Metropolitan Magistrate or Judicial Magistrate of the second class shall try any
offence under this section.

Management of Safdarjung Hospital v. Kuldip Singh (1993) 3 SCC 571

In this case, the Supreme Court of India held that the standing orders must be unambiguous, precise and
clear in their scope and application. The court emphasized the importance of ensuring that the standing
orders are drafted in a manner that can be easily understood by the employees. The court also held that
standing orders cannot be modified unilaterally by the employer and any changes must be made through the
prescribed procedure.

In Delhi Cloth and General Mills Co. Ltd. v. Workmen, the Supreme Court of India held that the standing
orders must be framed in a fair and reasonable manner and must not be arbitrary or discriminatory. The
court also held that the standing orders cannot be used to restrict the fundamental rights of the employees.

In State of Maharashtra v. Ramdas Shrinivas Nayak, the Supreme Court of India held that the
certification of the standing orders is not a mere formality and must be done with due diligence. The court
held that the certifying officer must ensure that the standing orders are in compliance with the Industrial
Employment (Standing Orders) Act, 1946, and must be in accordance with the principles of natural justice.

In Ahmedabad Textile Industry’s Research Association v. State of Bombay, the Supreme Court of India
held that the standing orders must be reasonable and must not be in contravention of any existing law. The
court also held that the standing orders must not be against public policy and must not violate the principles
of natural justice.

In Hyderabad Chemical and Pharmaceutical Works Ltd. v. State of Andhra Pradesh, the Andhra
Pradesh High Court held that the standing orders must be framed in a manner that takes into consideration
the interests of both the employer and the employees. The court held that the standing orders must balance
the interests of both parties and must not be oppressive or unjust towards the employees.

PAYMENT OF SUBSISTENCE ALLOWANCE

According to Section 10A of the Act, where any workmen is suspended by the employer pending
investigation or inquiry into complaints or charges of misconduct against him, the employer shall pay to
such workman subsistence allowance:
(a) at the rate of fifty per cent. of the wages which the workman was entitled to immediately preceding
the date of such suspension, for the first ninety days of suspension; and
 (b) at the rate of seventy-five per cent. of such wages for the remaining period of suspension if the delay
in the completion of disciplinary proceedings against such workman is not directly attributable to the
conduct of such workman.
If any dispute arises regarding the subsistence allowance payable to a workman under sub-section (1) the
workman or the employer concerned may refer the dispute to the Labour Court, constituted under the
Industrial Disputes Act, 1947, within the local limits of whose jurisdiction the industrial establishment
wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall,
after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and
binding on the parties.
Notwithstanding anything contained in the foregoing provisions of this section, where provisions relating to
payment of subsistence allowance under any other law for the time being in force in any State are more
beneficial than the provisions of this section, the provisions of such other law shall be applicable to the
payment of subsistence allowance in that State.

In Kalyanpur Keshav Venkatrai Pai vs. Corporation Bank, the petitioner was Manager of Corporation
Bank, Kalbadevi Branch, Bombay. The petitioner claimed subsistence allowance based on Bombay Shops
and Establishments Act, 1948 and the Standing Orders Act, 1946. It was held that the Standing Orders Act
and rules will apply to only such of the employees of the Shops Act who would be “workmen” within the
meaning of the Standing Orders Act and rules framed thereunder. Employees who are not workmen as
above will not be covered by Section 38B of Bombay Shops and Establishment Act. By applying the rule of
harmonious construction, it is clear that legislation could not have intended to confer on managerial
employees the benefits if benevolent provisions meant primarily to protect ‘workman’. Since Manager of a
Bank is not a workman he cannot claim subsistence allowance.

It was held in Transport Manager vs. Vilas Sanu Deokar and Others, that if an employer does not
provide work to a Badli workman by issuing no duty order, it would not amount to suspension from work. A
person can be suspended from work provided there is a vested right in the workman to secure work from the
employer everyday while the contract of employment subsists. However, in the case of a Badli workman,
the contract of employment comes into effect only on the day he is given employment, and therefore, the
question of suspension from work on account of a ‘no duty order’ does not arise. A Badli workman is one
who performs his duty as and when work is made available to him by the employer. If there can be
suspension from work of a Badli workman, the question of being entitled to subsistence allowance during
the period he is not allotted work does not arise.

In Vijaya Bank vs. Shyamlal Kumar Lodh, respondent was an employee of Vijaya Bank which was a
nationalised bank. Shyamlal Kumar gave an application before the Labour Court which was constituted
under the Industrial Disputes Act for an award computing his subsistence allowance. The appropriate
Government in relation to the employee is the Central Government and the employee had filed his
application before the Labour Court constituted by the State Government. Therefore, the application was
contested by the appellant on the ground that the Labour Court not being constituted by the appropriate
Government had no jurisdiction. The Labour Court overruled the objection of the Bank and a Single Judge
of High Court upheld it. Division Bench of High Court also confirmed the Labour Court’s order. Hence, the
Bank preferred an appeal before the Supreme Court. The appeal was dismissed with costs of Rs. 25,000/- to
be paid to the respondent. It was observed that under Section 10A(2) of the Industrial Employment
(Standing Orders) Act, Labour Court constituted under the Industrial Disputes Act, had jurisdiction to decide
any dispute regarding subsistence allowance arising within the local limits of whose jurisdiction the
establishment was situated.

DUTIES OF CERTIFYING OFFICER

As per Section 3 of the Act, the certifying officer has to receive the five copies of draft standing orders
proposed by the employer, for adoption in his industrial establishment.
As per Section 4 of the Act, it shall be the function of the certifying officer to adjudicate upon the fairness or
reasonableness of the provisions mentioned in the standing orders. He has to ascertain that the terms of the
draft standing order are in conformity with the provisions of the Act.

As per Section 5 of the Act, the certifying officer shall forward a copy of the draft standing order to the
trade unions, once he receives the receipt of the draft standing order submitted by the employer of the
industrial establishment. It should be noted that by way of such forwarding, the trade unions are given a
chance to raise objections to the draft standing order submitted by the employer. Further, the role of the
certifying officer extends to deciding whether to accept the modification presented by trade unions or
not. That means, the decision to modify or amend the same is the discretion of the certifying officer.
The certifying officer has also a role to certify the draft standing orders, with or without modification.

As per Section 8 of the Act, the registration of the final certified copy shall be done by the certifying officer
in the register. Further, he shall furnish an approved copy of Standing Orders to any person applying for it
upon payment of the prescribed fee.

As per Section 11 of the Act, Every Certifying Officer and appellate authority shall have all the powers of a
Civil Court for the purposes of receiving evidence, administering oaths, enforcing the attendance of
witnesses, and compelling the discovery and production of documents, and shall be deemed to be a civil
court within the meaning of sections 345 and 346 of the Code of Criminal Procedure, 1973.
Clerical or arithmetical mistakes in any order passed by a Certifying Officer or appellate authority, or errors
arising therein from any accidental slip or omission may, at any time, be corrected by that Officer or
authority or the successor in office of such Officer or authority, as the case may be.

In Associated Industries vs. B.B. Singh, Supreme Court observed that the fact that under Section 11 of the
Act, the Certifying Officer and the Appellate Authority have all the powers of a Civil Court for certain
specified purpose will not convert them to a ‘Court’, nor he fact that the matter was agitated in a writ
petition before the High Court will make the proceeding before the Labour Court “a civil proceeding in a
Court”.