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CHAPTER- 26
LABOUR LAWS

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Consumer Protection Act 1986

The consumer protection Act, 1986 seeks to provide for the protection of the interests
of consumers and for that purpose to seek provision for establishment of Consumer
Councils and other authorities to settle the consumer disputes and matters connected
therewith.
Objects
It aims at protecting the rights of the consumer such as
1)
2)
3)
4)
5)
6)

The right to be protected against marketing of goods which are hazardous to

life and property,
The right to be informed about the quantity, potency, purity, standard, and
price of goods to protect the consumer against unfair trade practices
The right to be assured wherever possible, access to variety of goods at
competitive prices.
The right to be heard and to be assured that consumers interests will receive
due consideration at appropriate forums,
The right to seek the redressal against unfair trade practice or unscrupulous
exploitation of consumers and
Right to consumer education.

The above objects are sought to be promoted and protected by the consumers
protection councils at central and state levels.
To provide speedy and simple redressal to consumer disputes, a quasi-judicial
machinery is set up at district, state and central levels. These quasi-judicial bodies will
observe the principles of natural justice and are empowered to give relief of a specific
nature and to award appropriate compensation to consumers. They are also
empowered to impose penalties for non-compliance of orders given by them
Consumer Disputes Redressal Agencies: A consumer disputes redressal forum
District Forum is established by state government in each district of the state. If
required more than one district forum can also be established in the district.
In addition to the above the state government also establishes state commission for
consumer disputes redressal. National consumer disputes redressal commission is
established by central government by notification.

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Manner in which complaint is made

A complaint in relation to any goods sold or any service provided or agreed to be
provided may be filed in the district forum by
1)
Any consumer to whom such service provided.
2)
Any recognized consumer association whose member has been provided with
such service.
3)
One or more consumers where there are numerous consumers having the same
interest.
The district forum shall have the same powers as are vested in civil court. In
summoning and enforcing attendance of witness, defendants, securing production of
any record, material object as evidence. Every proceeding held by district forum shall
be covered by Indian Penal Code and district forum shall be deemed to be civil court.
Finding of the District Forum:
After the proceedings are conducted, if the district forum is satisfied that the
complaint about the services are proved, it shall order the opposite party directing him
to do one or more of the following things namely,
1)
To pay such amount as may be awarded by it as compensation to the consumer
for any loss or injury suffered by the consumer due to the negligence of the
opposite party.
2)
To remove the defects or deficiencies in the services in question
3)
To provide for adequate costs to parties
4)
To return to the complainant the charges paid by him
Appeal:
Any person aggrieved by an order made by the district forum may prefer an appeal
against such order to the state commission within 30 days from the date of the order.
The state commission may entertain after this period also at its discretion
State Commission:
1.

State commission is constituted by respective state government. The state

commission is empowered to entertain:
(i) Complaints where value of goods or service and compensation exceed
20 lakhs but not more than 100 lakhs
(ii) Appeal against district forum

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National Commission
National commission is constituted by the central government conferring with
sufficient power and independence.
It entertains the complaint where the value of goods/ service or amount of
compensation exceeds 100 lakhs.

Brief on Industrial Disputes Act, 1947

Object
The object of Industrial Disputes Act is to settle the disputes between the Employer
and the Employees.
Any Industrial dispute to be adjudicated by a Labour Court/Tribunal shall be only on
a reference by the appropriate Government, where the Union takes up the dispute.
For this purpose the Conciliation Officer appointed by the Appropriate Government
after admitting into conciliation and failing to make the parties to come to an
agreement sends to the appropriate Government a report called failure report. Upon
the receipt of such a report the appropriate government applies its mind and refers the
dispute for adjudication.
Industrial Dispute, Sec.2
Industrial dispute means any dispute or difference between Employers and Employees
and workmen or between workmen connected with the employment or with the
conditions of Labour of any person. Dispute under this Section includes, strikes,
lock-out, lay-off, closure, dismissal, retrenchment, termination of service, wage
revision and demands for the benefit of workmen, statutory entitlement etc.
Retrenchment
Retrenchment means the termination of the Services of a workman by the Employer
for any reason what-so-ever.
Conditions to be complied with
In order to make retrenchment valid the following conditions must be fulfilled before
the actual effective date of retrenchment.

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1)

2)

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The retrenchment workman shall be given one month notice or one month pay
instead of such notice.
Plus
Compensation at the rate of 15 days average pay for each year of completed
service. This must be tendered i.e. offered to the concerned workman either
before the actual date of retrenchment or simultaneously.

Strike
Strike means the stoppage of work by a body of persons employed in the Industry
acting in combination or a united refusal under a common understanding of any
number of persons to continue to work or accept employment.
A strike may be by some workers only or in one department or some departments
totally. In such an event the employer has the option of running the business or to
declare lock-out as a result of the strike, if he apprehends danger to the persons or loss
of property or likely to endanger the peace and tranquility. In the case of Strike also it
must be proved that it is both lawful or justified.
Prohibition of Strikes and Lockouts
(Sec.22, 23, 24, 26 and 10(3)
Where Industries are notified as public utility services by the Appropriate
Government, no strike or lock-out can be resorted to unless a notice of 6 weeks in the
prescribed form is given making a copy of the same to the Conciliation Officer having
Jurisdiction. Such strike or lockout shall not take place within 14 days of giving such
notice or before the date specified in such notice. If the employer or workman /
Union contravene this provision the lockout or the strike as the strike may be illegal
for which the party contravening can be prosecuted (26).
Change in Service Conditions Procedure, Sec. 9-A
The employer cannot effect any change in the service conditions of any workmen. In
order to effect such a change the employer must give 21 days notice in the prescribed
form to the workman to the effected/Union. No such change can be effected within
21 days.
Adjudication Labour Courts Procedure, Sec.11
In matters coming up before Labour Court, Industrial Tribunal or National Tribunal
for adjudication the said Authority gives opportunity to the Employer and the
workman to submit their statements on the issues involved, examine witnesses,

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receive documents relied upon and after hearing both the parties pass its award. Such
award becomes effective one month after its publication in the Official gazette
making the award an enforceable one.
These Courts have power to summon
witnesses, examine the witnesses on Oath, Summon documents as applicable to Civil
Courts.
Publication and Finality of Award, Sec.17, 17-A
An Award given by the Court has to be published in the Gazette which becomes final
after 30 days of such publication and it becomes enforceable.
Settlements and Binding Nature Sec.2 (P), 12(3), 18(1)
As earlier stated a settlement entered into between the parties directly called a
Bilateral settlement is binding only on the Union and its members or the workmen
entering into such settlements. These are also called 18(1) settlement.
Such settlements are not binding on other Unions or Workmen who are not parties to
such settlements and on workmen who join the establishment subsequent to the
settlement.
Settlements entered through conciliation are known as Tripartite settlements or 12(3)
settlements. Such settlements are binding not only on the parties to the same but also
others who are not parties to the same and those employed subsequent to the said
settlement. This is the effect of Sec 18(3).
It does not matter if other Unions do not join such 12(3) settlements. Where there is a
recognized Union the settlement has to be entered into with such recognized Union
through other Unions can raise their Charter of demands which also have to be
considered.
Termination of settlement continues to bind
A settlement unless replaced by another settlement even though terminated will
continues to be binding even after the expiry of the period of the settlement. A
settlement has to be terminated by giving two months notice but should not be
terminated before the expiry of the period. An Award will be in force for one year,
other than continuing obligations which continue even after one year.
Unions Recognition, Sec. 29
There is no provision either under the Industrial Disputes Act 1947 or the Trade
Union Act 1926 to grant recognition to any Registered Trade Union. Recognition
means identifying the collective bargaining Agent as a Representative Union.
Recognition is only for purposes of negotiations with the Employer and to enter into

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settlements and does not prevent other Unions from serving Charter of demands on
the Management.
In some states there are Industrial Relations Acts under which granting of Recognition
is compulsory. (Maharashtra, Gujarat, UP to the knowledge of the Authors).
In the absence of any such provision no Union can insist on the grant of recognition
and cannot claim as of a right to be granted recognition. Management is not bound to
grant any such recognition.
Where management agrees to grant Recognition to a Majority Union, all the Unions
in the establishment and Management have to enter into agreements agreeing to abide
by the code of discipline. On such agreements to the Registrar of Trade Unions of the
concerned establishment holds an election amongst the workmen for the purpose of
determining the majority. The Union which secures majority at such election will be
recommended by the Commissioner of Labour to the Management to grant
Recognition. On such recommendation, Management will grant recognition to the
Majority Union which will be in force for a period of 2 years from the date and
continues to be in force till elections for recognition are held.
Unfair Labour Practice, Sec. 2(ra), 2(T), 2(U)
The following are unfair labour practices:
I.

On the part of Employers and Trade Unions of Employers:

1)

To interfere with, restrain from, or coerce, workmen in the exercise of their

right to organize, form, join or assist a Trade Union or to engage in concerted
activities for the purposes of collective bargaining or other mutual aid or
protection that it to say:
a) Threatening workmen with discharge or dismissal, if they join a trade
union;
b) Threatening a lockout or closure, if a trade union is organized;
c) Granting wage increase to workmen at crucial periods of trade union
organization, with a view to undermining the effects of the trade union at
organization.

2)

To dominate, interfere with or contribute support, financial or otherwise, to

any trade union, that is to say
a) An employer taking an active interest in organizing a trade union of his
workmen, and

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

3)

To establish employer-sponsored trade unions of workmen.

4)

To encourage or discourage membership in any trade union by discriminating

against any workman, that is to say: a) Discharging or punishing a workman because he urged other workmen
to join or organize a trade union.
b) Discharging or dismissing a workman for taking part in any 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 activity;
d) Refusing to promote workmen to higher posts on account of their trade
union activities;
e) Giving unmerited promotions to certain workmen with a view to creating
discord amongst other workmen, or to undermine the strength of their
trade union;
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 victimization;

b) Not in good faith, but in the colourable exercise of the employers rights;
c) By falsely implicating a workman in a criminal case on false evidence or
on concerned evidence.
d) For patently false reasons;
e) On untrue or trumped up allegation of absence without leave;
f)
In utter disregard of the principles of natural justice in the conduct of
domestic enquiry or with undue haste;
g) For misconduct of a minor or technical character, without having any
regard to the nature of the particular misconduct or the past record or
service of the workman, thereby leading to a disproportionate
punishment.
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.
To transfer a workman mala fide from place to place to another, under the
guise of following management policy:
To insist upon individual workmen, who are on a legal strike to sign a good
conduct bond, as a pre-condition to allowing them to resume work.
To show favorism or partiality to one set of workers regardless of merit.

6)
7)
8)
9)

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16)

To employ workmen as badlis, casuals or temporaries and to continue them

as such for years, with the object of depriving them of the status and privileges
of permanent workmen.
To discharge or discriminate against any workman for filing charges or
testifying against an employer in any enquiry or proceeding relating to any
industrial dispute.
To recruit workmen during a strike which is not an illegal strike.
Failure to implement award, settlement or agreement.
To indulge in acts of force or violence.
To refuse to bargain collectively, in good faith with the recognized trade
unions.
Proposing or continuing a lockout deemed to be illegal under this Act.

II.

On the part of workmen and trade unions of workmen.

1)

To advice or actively support or instigate any strike deemed to be illegal under

this Act;
To coerce workmen in the exercise of their right to self-organization 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.
For a recognized union to refuse to bargain collectively in good faith with the
employer.
To indulge in coercive activities against certification of a bargaining
representative.
To stage, encourage or instigate such forms of coercive actions as willful go
slow, squatting on the work premises after working hours of gherao of any
of the members of the managerial or other staff.
To stage demonstrations at the residence of the employers or the managerial
staff members.
To incite or indulge in willful damage to employers property connected with
the industry.
To indulge in acts of force or violence or to hold out threats of intimidation
against any workman with a view to prevent him from attending work.

10)

11)

12)
13)
14)
15)

2)

3)
4)
5)

6)
7)
8)

Employers, workers and Trade Unions are prohibited to commit any unfair Labour
practice (Sec.25-T) and the same is made punishable with imprisonment upto six
months or with fine or with both.

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Brief On Contract Labour Act

Object
This Act came into force with effect from 10th February, 1971. The object of the Act
is to regulate the employment of Contract Labour employed in certain establishments
and to provide for its abolition in certain circumstances.
Applicability
This Act applies to every establishment in which 20 or more workers are employed or
were employed on any day of the preceding 12 months as Contract Labour. This Act
also applies to every contractor who likewise employs in the establishment.
Establishment
Establishment means any office or department of government or local authority or any
place where any industry, trade, business, manufacture or any occupation is carried
on. Government has the power to extend the application of the Act to any other
establishment.
Principal Employer
In the case of any office or department of Government or local authority employing
contract labour through a contractor the Head of that office or department or any other
officer notified by the said authorities is known as the principal employer.
Contractor
Contractor under an establishment is one who undertakes to produce a given result to
the establishment through his labour but does not include one who merely supplies
goods or articles of manufacture to such establishment.
Workman
A workman is one who is employed by the contractor to do any skilled, semi skilled,
unskilled, manual, supervisory, technical or clerical work for hire or reward in or inconnection with the work of the establishment.
Appropriate Government
The Appropriate Government may be the Central Government or the State
Government as per the definition of the Industrial Dispute Act.

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Registration as Principal Employer

Every Principal Employer to which the Act applies has to register his Establishment
under the Act if Contract labour is intended to be employed therein. Such registration
shall be made with the appropriate government who appoints the registration officer.
License for Contractor
Every contractor who employs labour to work in the establishment of the Principal
Employer shall obtain a license from the appropriate officer of the appropriate
government.
Prohibition of Employment of Contract Labour
The Principal Employer shall not employ any Contract Labour without registering his
establishment under the Act or where such registration is revoked. The appropriate
government has power to prohibit the employment of contract labour in any
establishment where the process / operation or other work is incidental to or necessary
for industry, trade, business, manufacture or occupation carried on in the
establishment, where the work is of perennial nature i.e. whether the work is of
sufficient duration having regard to nature of industry, trade etc., carried on in the
establishment, whether such work is done ordinarily thorough regular workmen in
that establishment or in a similar establishment and whether it is sufficient to employ
considerable number of whole-time workmen.
Canteen, Health, Welfare, Safety, Amenities
The contractor has to provide a canteen for use by the contract labour where the
number of the contract labour employed by him is 150 or more. The rules framed in
this regard may provide the standards of construction, accommodation, etc., the food
stuffs to be served and the charges, rest rooms, whole-some drinking water, enough
number of latrines and urinals, washing facilities and first aid facilities health and
welfare measures for contract labour specified in the rules.
Conditions of Service, Wages, O.T. Rest Day, Working hours etc.
The conditions of service regarding the issuance of employment card, working hours,
employment of females, bar an employment of child labour, intervals of rest spread
over, extra wages of overtime, weekly rest, national and festival holidays, leave with

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wages, maintenance of registers, the wages to be paid, procedure for termination of

services, right to lay-off the workers are prescribed.
Applicability of EPF, ESI, MW Act, I.D. Act, etc. Acts.
The Provisions of the Factories Act and EPF Act and the Employee State Insurance
Act, the Minimum Wages Act, the Industrial Disputes Act, the Workmens
Compensation Act also apply to the Contract labour.
Rates of Wages Etc.
Where the workmen employed by the Contractor perform the same of similar kind of
work performed by the workmen directly employed by the Principal Employer, the
wages, rates, holidays, hours of work and other conditions of service of the
workmen's of the contractor shall be the same as that of the workers employed by the
Principal employer. In the licence issued to the contractor the conditions are
enumerated.
Registers
The contractor as well as the Principal employer has to maintain certain Registers.
The contractor has to maintain certain registers and such registers are maintained
under the pay muster roll, wage register, deductions register and overtime register.
Registers maintained under the payment of Wages Act or Minimum Wages Act
showing the above things could be allowed to be treated as the Registers under this
Act.
Liability of Principal Employer
If the contractor fails to provide health and welfare amenities the same shall be
provided by the Principal Employer and the cost of same can be deducted either from
the bills of the contractor.
Contractor to specify number of workmen
Every contractor obtaining licence shall specify the exact number of workmen
intended to be employed in the establishment of the Principal Employer in the
Application and also make Security Deposit at the rates prescribed by the Appropriate
Government. These deposits are refundable at the end of licence period on proof that
no wages fell in arrears. Wages prescribed shall be paid by the contractor in the

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presence of Authorized Representatives
acknowledgements obtained in his presence.

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of

the

Principal

Employer

and

Non-Payment of Wages Liability of Principal Employer

If the contractor fails to pay the wages to the contract labour employed by him or
makes short payment or fails to prove the payment of wages the Principal Employer
shall be liable to pay such wages on behalf of the contractor and is entitled to deduct
the same from the bills of the contractor or otherwise which word includes filing a
Civil suit also for the recovery of such payments on behalf of the contractor.
Brief on Workmens Compensation Act
Workmen Compensation Act provides for compensation when any workman while on
duty meets with any accident or death thereby deprives the workman or family of his
earnings. This Act provides cheaper and quicker mechanism for providing
compensation to workman in such cases. In DoT / BSNL when workmen like
Mazdoors or Phone Mechanics suffer any injury including electrocution they are
entitled for compensation under this Act. The injuries are specified in the schedules of
the Act.
Employers Liability to Pay Compensation
This Act is administered a Commissioner by a Commissioner appointed under Section
20 of the Act. The employer is liable to pay compensation to a workman for any
personal injury while in the course of employment. But such compensation need not
be paid where the injury does not cause any disablement for more than three days,
where the injury other than death or permanent disablement is caused on account of
the workman being drunk or willful dis-obedience of any Safety order or willful
removal of any Safety guard or device which he knows has been provided to prevent
accidents.
Dependents
The following persons are dependents of the workman who can claim the
compensation incase of death of a workman.
i)

a widow, minor (born legitimately or adopted), Son, an Unmarried daughter,

(legitimate or adopted), daughter, or a widowed mother and if wholly
dependent on the earnings of a workman at the time of his death, a Son or a
daughter who has attained 18 years of age and,

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ii)
iii)

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if wholly or in part dependent on the earnings, of a workman at the time of his

death,
a widower, a parent other than a widowed mother, a minor illegitimate Son, an
unmarried daughter or a legitimate or adopted daughter if married and a minor
or if widowed and a minor, a minor brother or an unmarried sister or a
widowed daughter-in-law, a minor child or a pre-deceased son or daughter
where no parent of the Child is living or paternal Grandparents, if no parent of
the workman is alive (Sec.2(d):

Payment of Compensation
i)
ii)

The compensation has to be paid as laid in Sec. 4 as soon as if falls due.

If the Employer does not accept the liability the amount payable according to
the Employer shall be deposited with the Commissioner or pay to the
workman without prejudice to his contention.
iii)
If the amount of compensation due is not paid within one month from the due
date, the Commissioner shall:
a.
Direct the payment of compensation with interest
b.
if he considers that there is no justification for the delay direct payment
of the compensation amount, interest and a further sum not ex exceeding
50% of that amount, can be ordered to be paid.
In cases falling under (b) above, no penalty can be levied without giving a show cause
notice. While the interest ordered to be paid will be paid to the workman, the penalty
shall be credited to the State Government.
Method of calculation of compensation
The method of calculation of compensation and the amount of compensation for
various injuries resulting in
I.
II.
III.
IV.

Death
Permanent Disablement
Permanent partial disablement
Temporary disablement

Distribution of compensation
In case of death of a workman or who is under any legal disability the compensation
shall be deposited with the Commissioner. The employer cannot make payment
directly to the dependants. But advances can be given to the extent of three months

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wages. Such advances on proof shall be deducted by the Commissioner and paid to
the Employer.
Any other sum which is not less than ten rupees shall be deposited with the
Commissioner.
Any receipt given by the Commissioner discharges the Employer in respect of the
deposit made.
The Commissioner after holding an enquiry about the dependents orders payment of
the compensation amount deposited by the apportionment.
In case the amount is payable to a workman or to a person under legal disability the
same may be invested for the benefit of such persons.
In case of half monthly to a person under legal disability Commissioner may order
payment during the disability to the dependent or any other person as determined by
the Commissioner.
Reports of Fatal Accidents and Serious Injuries
If any law requires that a notice of death or serious bodily injury took place in an
accident to the workman while on duty, the Employer shall within Seven days of the
accident send a report to the Commissioner stating the circumstances in which the
accident took place.
Where notice of such accident is given as per the mandate of any Law to the
Authority specified therein no notice need be sent to the Commissioner.

Descriptive questions in Labour laws

Contract labour act
1).
2).
3).
4).
5).
6).
7).

What is the object of Contract Labour Act ?

What is the applicability of Contract Labour Act ?
As per the Contract Labour Act, what is the definition of Establishment
Who is the Principal Employer as per the Contract Labour Act ?
Who is the Contractor as per the Contract Labour Act ?
Who is the Worker as per the Contract Labour Act ?
What is the Appropriate Government as per the Contract Labour Act ?

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8).
9).
10).
11).
12).
13).
14).

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What are the Obligations of the Principal Employer as per the Contract
Labour Act ?
What are the Obligations of the contractor as per the Contract Labour Act ?
What are the Obligations of the contractor regarding Health, welfare and
safety of Contract labour ?
What are the provisions regarding prohibition of engagement of
Contract Labour ?
What are the other Acts applicable to Contract Labour ?
What are the Registers to be maintained by the Contractor as per the
Contract Labour Act ?
What are the liabilities of the Principal Employer regarding payment of
wages to Contract Labour t ?

INDUTRIAL DISPUTES ACT-1947

Q-1.

What is the object of the Act?

Q-2.

What is meaning of the Industrial Dispute?

Q-3.

What is Retrenchment? What are the conditions to be complied with?

Q-4.

What is the meaning of Strike? What are the prohibitions of Strikes and
Lockouts?

Q-5.

What is the procedure to be adopted by the employer in change in Service

conditions?

Q-6.

What is the adjudication procedure in Labour Courts?

Q-7.

Briefly explain the Settlements and Binding nature?

Q-8.

Briefly explain the procedure of Union recognition explained in ID Act-1947?

Q-9.

What are the Unfair Labour Practices on part of Employers and Trade Unions
of employers?

Q-10. What are the Unfair Labour Practices on part of Workmen and trade Unions of
workmen?

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