COMPARISON BETWEEN THE

TRADE UNIONS ACT, 1926 AND

KERALA RECOGNITION OF
TRADE UNIONS ACT, 2010

Roshanara Abdul Rauf

Roll no. 795

 
IX Semester
Contents
Basis of Comparison:............................................................................................................................2
Extent of Applicability:.........................................................................................................................2
Object:...................................................................................................................................................4
Difference between Registration and Recognition:................................................................................4
Important case Laws:.............................................................................................................................6
Procedure...............................................................................................................................................6
Cancellation of Registration................................................................................................................10
Rights, Liabilities and Immunities provided under the Act:................................................................11
Penalties..............................................................................................................................................15
Conclusion...........................................................................................................................................16
Basis of Comparison:

 Extent of Applicability
 Object
 Difference between Registration and Recognition
 Procedure
 Rights and Liabilities Conferred
 Penalties

Extent of Applicability:

The Trade Unions Act, 1929

It is a central legislation which extends to the whole of India.

Kerala Recognition of Trade Unions Act, 2010

There is no Central law on granting recognition to trade unions. The Parliament had once
passed the Indian Trade Union (Amendment) Act, 1947, but it was never notified or brought
into force. The said Act sought to introduce Chapter III-A into the TU Act, 1926, which inter
alia, enumerated the conditions required for obligatory recognition of trade unions.

Trade Unions (Amendment) Act, 1947, s. 25D provides that a trade union will not be entitled
for recognition by order of a labour court under s. 25E unless it fulfils the following
conditions, namely:

(1)That all its ordinary members are workmen employed in the same industry or in industries
closely allied to or connected with another;

(2) That it is representative of all the workmen employed by the employer in that industry or
those industries;

(3) That its rules do not provide for the exclusion from membership of any class of the
workmen referred to in cls. (b);

(4) That its rules do not provide for the procedure for declaring a strike;
(5) That its rules provide that a meeting of its executive will be held at least once in every six
months; and

(6) That it is a registered trade union and that it has complied with all provisions of this Act.

15th Indian Labour Congress accepted a Code of Discipline and one of the clauses therein
pertains to Recognition of Unions. Presently, the said code is considered as the accepted
norm for Recognition of Trade Unions by most of the employers. According to the said code,
for recognition:

 The Unions should have at least one year standing.

 They should have at least 15% of the membership of the establishment to claim
recognition; and 25% of the work force to claim recognition on industrial basis.
 When there are multiple unions in an establishment, the union with largest
membership will be given recognition.
 The local unions if they have more than 50% of the membership of the locality, can
be recognized to represent their grievances.
 The recognition granted will be valid for 2 years.
 The unions which do not follow code of discipline will not be granted recognition.

The National Commission for Labour headed by Dr.Gajendragadkar, laid down a strict
guideline for recognition of trade unions. The commission expressed the view that industrial
democracy should be applicable and the majority union should have the right to sole
representation; and where more unions than one contend for recognition, the union having a
larger following should be recognized.1

Few State Legislatures have enacted laws conferring legal right to Trade Unions to claim
Recognition of the Employer. The Bombay Industrial Relations Act, 1946 is a beacon on the
subject. In the said Act, the guidelines laid down by the National Labour Commission are
incorporated for recognition of a Trade Union. Maharashtra Recognition of Trade Unions &
Prevention of Unfair Labour Practices Act, 1972, is the other pertinent legislation on the
subject. In the said act, recognition is afforded to any union which has 6 months of standing
and membership not less than 30% of the total employees. The provisions for recognition of
trade union in the Maharashtra Act are applicable only to those industries which are outside

1
Recognition of Trade Unions, http://www.lawteacher.net/free-law-essays/employment-law/recognition-of-
trade-unions-employment-law-essay.php (last visited Sept. 27, 2016).
the scope of the Bombay Act. Similar laws have been enacted in the states of West Bengal,
Rajasthan, Andhra Pradesh and MadhyaPradesh. The states of Bihar and Orissa have specific
non-statutory provisions setting forth rules and principles for the recognition of trade unions.

Kerala Recognition of Trade Unions Act, 2010 being a State legislation is applicable only to
Kerala. It applies to every industrial establishment situated in Kerala, except the industrial
establishments for which Central Government is the appropriate Government under the
Industrial Disputes Act, 1947 wherein fifty or more workmen, are employed or were
employed any day of the preceding twelve months and every registered trade union
functioning in such industrial establishment. The Government may, after giving not less than
sixty days notice of its intention so to do, by notification in the Official Gazette, apply the
provisions of this Act to any industrial establishment employing such number of persons less
than fifty, as may be specified in the notification.2

Object:

The Trade Unions Act , 1926

The TU Act provides for the registration of trade unions with the Registrar of Trade Unions
in their respective territory and defines the law relating to Registered Trade Unions.3
However, it does not make registration mandatory.

Kerala Recognition of Trade Unions Act, 2010

The Act provides for the recognition of Trade Unions for facilitating collective bargaining
and to check multiplicity of Trade Unions in industrial establishments and other related
matters.

Difference between Registration and Recognition:

Registration

Under this Act, a TU on making the necessary application will, on compliance with certain
stated conditions designed to ensure that the Union is a bona fide Trade Union, and that
adequate safeguards are provided for the rights of its members, be entitled to registration.
2
S 1(3), Kerala
3
Preamble
Registration will confer on its Union and its members, protection in certain cases of civil and
criminal liability. A registered Trade Union is deemed to be a body corporate, thus giving it
the status of a legal entity. As a result, a registered trade union has perpetual succession and a
common seal with the power to acquire and hold property and to enter into contracts. It also
has the power to sue and, consequently, be sued as well. An unregistered trade union, on the
other hand, would not be considered a juristic entity. 4 A registered trade union assumes more
importance because other labour laws such as the Industrial Disputes Act, 1947 (IDA), and
the Industrial Employment (Standing Orders) Act, 1946 (IESOA), define a labour union to
mean a union that has been registered under the TU Act. The Trade Unions Act, 1926 is
completely silent on the question of recognising a trade union for the purpose of collective
bargaining.

Recognition:

Recognition of a trade union is very different from Registration of the union under the Trade
Union Act, 1926. Recognition of Trade Union is generally a matter of agreement between
employer and trade union.

Recognition means management conferring right to the Union

1) to represent its members as the bargaining agent during the various discussions and
deliberations made while negotiating terms of employment/conditions of labour;

2) to enter into agreements [settlements] with the management on behalf of its union-
members; and

3) to air its opinion when general opinion of workmen are sought while formulating
managerial policies and decisions.

Although there is a fundamental right to form unions under Article 19(1)(c) and a statutory
right to get it registered, there is no corresponding legal obliging on the employer
/management to recognize any particular trade union, whether registered or not, even if they
are truly representative.

Recognition of a Trade Union receives importance when there are multiple trade unions in an
establishment. The managements usually refuse to recognize small or regional trade unions
so as to reduce the number of different voices espousing different demands, while negotiating
4
National Organization of Bank Workers’ Federation of Trade Unions v. Union of India (1993)
wage settlement or conditions of employment. The need for recognition of trade unions by
employers was felt by the working class to ensure that appropriate modes of collective
bargaining took place and that the agreements, which were collectively reached, were
mutually observed. It was considered that recognition of trade unions was a step towards
securing reasonable levels of pay and working conditions. This in turn will be achieved if
workers stood united in representing their demands through a trade union, which is
adequately recognized. Recognition of a Trade Union is a matter of volition on the part of the
employer.

Important case Laws:

• All India Bank Employees’ Association v. National Industrial Tribunal, Bombay5

The Supreme court had the occasion to consider the scope and ambit of Article 19(1)(c) of
the Constitution. There Lordships held that even very liberal interpretation of the said
constitutional provision cannot lead to the conclusion that the fundamental right to form
unions carries with it a concomitant guarantee that the trade unions so formed shall be
enabled to carry out effective collective bargaining or shall archive the purpose for which
they were brought into existence.

• Raghubar Dayal Jai Prakash v Union of India, AIR 1962 SC 263

Freedom of association guaranteed by Article 19(1)(c) does not carry with it a guaranteed
right to recognition of the association.

Procedure

Trade Unions Act, 1926

Section 3 (Appointment of the Registrar) : The appropriate government appoints a person to

be the registrar or trade unions for each state.

Section 4 (Mode of registration) says that to register a Trade Union, an application must be
sent to the Registrar of Trade Unions appointed by an appropriate government. The
application must be made by seven or more persons who are engaged in the trade or industry

5
AIR 1962 SC 171
in connection to which the Trade Union is to be formed. All the applicants must subscribe
their names to the rules of the Trade Union and comply with the provisions of this act
regarding registration. There must be at least 10% or 100, whichever is less, members who
are engaged or employed in the establishment or industry to which it is connected. There
must be not be less than seven members who are engaged or employed in the establishment
or industry to which it is connected. If more than half of the persons who applied for the
registration cease to be members of the union or expressly disassociate themselves from the
application, the application will be deemed to be invalid.

Section 5 (Application of Registration) gives the details of the application. It says that the
application should be sent to the registrar along with the copy of the rules of the trade union
and a statement of the following particulars:

 The name, occupation, and addresses of the applicants.

 The name of the trade union and the address of its head office.
 The titles, names, ages, addresses, and occupations of the office bearers of the trade
union.
 If the trade union has been in existence for more than 1 yr, a general statement of its
assets and liabilities.

Section 6 (Provisions to be contained in the rules of a Trade Union) specifies the provisions
that should be contained in the rule book of the trade union. A copy of this rule book must be
supplied along with the application for registration of the trade union. This rule book details
the internal administration of the trade union and also determines and governs the
relationship between the trade union and its members. It must contain the rules for the
following matters:

 name of the trade union

 the whole object of the trade union
 The whole purposes for which the general funds can be used.
 The maintenance of the list of members and adequate facilities to inspect it by the
members of the trade union.
 the membership of ordinary members who are actually engaged or employed in an
industry with which it is connected as well as the membership of the honorary or
temporary members.
  The appointment of members of the executive body.
 the membership or subscription fee, which shall not be less that 25 paisa per member
per month
 The conditions under which a member can get the benefits or has to pay fines.
 The safe custody of funds and provisions for inspecting or auditing the statements, or
other documents of the trade union.

Under section 7, the registrar has the power to ask for further information from the trade
union to satisfy himself that the trade union complies with section 5 and is eligible to be
registered under section 6. The registrar can refuse to register the trade union until he receives
the information. Further, he has the power to ask to change the name of the trade union if a
union with the same name already exists or if he feels that the name could be deceiving or
confusing to the public or the members of the trade union.

Under section 8, upon satisfaction of all the requirements, the Registrar of the Trade Unions
will register the trade union. It is mandatory for the registrar to register a trade union if the
union satisfies all the technical requirements of this act.

Under section 9, the registrar will issue the certificate of registration in the prescribed form,
which shall be a conclusive evidence that the trade union is registered under this act.

Kerala Recognition of Trade Unions Act, 2010

Under S. 3, The State Government is authorized to appoint an officer subordinate to it as a

Registrar via a notification in the Official Gazette

S. 4 deals with application for certificate for recognition. Any registered Trade Union may
apply with fee to the Registrar for issue of certificate for recognition as a recognised Trade
Union for an industrial establishment or a class of industry in a local area. No such
applications are entertained if there is already a recognised Trade Union during the period of
three years immediately following the date of recognition of that Trade Union by the
employer concerned A Trade Union has to satisfy the following criteria to be eligible to apply
for issue of certificate:

(i) It has been functioning as a registered Trade Union in an industrial establishment or the
class of industry in the local area, as the case may be, for a period of at least six months
immediately preceding the date of filing of such application
(ii) The membership thereof is open to all workmen employed in the industrial establishment
or the class of industry in the local area, as the case may be.

S. 5 deals with issue of certificate for recognition. After the registrar gives notice to other
Trade Unions functioning in an industrial establishment or a class of industry in a local area,
and holds an enquiry for determining whether the applicant Trade Union fulfils the conditions
laid down in section 4 and for ascertaining whether there is any other Trade Union interested
in submitting application, the Registrar shall enter the name of that Trade Union in the
prescribed register to be maintained by him for this purpose and grant a certificate to the
applicant Trade Union directing recognition of that Trade Union by the employer concerned
and upon such recognition, that Trade Union shall be the sole bargaining agent. If there are
more than one applicant Trade Unions the Registrar holds an election by secret ballot to
ascertain which of the applicant Trade Union secures the largest number of votes, being more
than fifty one per cent, of the votes cast by the workmen employed in the industrial
establishment or the class of industry in the local area and after recording the name of the
Trade Union securing the largest number of votes in the register to be maintained by him for
the purpose, grant a certificate to that Trade Union. However, the rest of the Trade Unions
obtaining ten per cent votes in a class of industry or fifteen per cent votes in an industrial
establishment will have all the rights of a recognised Trade Union and will be a party to a
settlement. But in the event a consensus could not be arrived at, the sole bargaining agent will
have the right to sign the settlement which will be binding under section 12 (3) of the
Industrial Disputes Act, 1947 The Registrar is also to record the names of such Trade Unions
as have secured not less than ten per cent of votes or not less than fifteen per cent of votes in
the register to recognise such Trade Unions as constituents of the joint bargaining council.
From amongst such unions, the Trade Union securing the largest number of votes shall be
given a certificate to recognise the same as the principal bargaining agent in the joint
bargaining council provided the said Union has secured not less than forty per cent of the
votes cast by the workmen. The constituents of the joint bargaining council shall have the
right to participate in any negotiation, discussion or settlement concerning the workmen
employed in the industrial establishment or the class of industry in the local area, as the case
may be. Two or more Trade Unions recognised as constituents of the joint bargaining council
together having more than fifty per cent of the votes in election shall be entitled to sign any
settlement in a case where there is no principal bargaining agent. Where there is a principal
bargaining agent in a joint bargaining council, no settlement can be entered into without the
principal bargaining agent as a party.

S 8 confers on the members of a registered trade union, eligibility for voting to all workmen
who are above the age of 18 years and have been in service for a period of 120 days in a
period of 12 months immediately before the announcement of an election to be held.

Thus, A Trade Union is eligible to recognition only if its membership is be open to all and it
has been functioning in an industrial establishment or the class of industry in the local areas,
for a period of at least six months preceding the date of filing of the application. If there is
more than one eligible Trade Union, the Registrar shall arrange an election by secret ballot
among the employees of the establishment. In such election, the Trade Union securing
maximum votes shall be recognized as the Principle Bargaining Agent. Every other trade
union which has received minimum of 15% votes in an industrial establishment or 10% votes
in a class of industry, would also be recognized constituents of a Joint Bargaining Council. If
any trade union in such an election receives more than 51% of votes, then it would be
recognized as the Sole Barging Agent of the workmen of that industry [Section 5]6.

Thus, it can be inferred that as many Trade Unions can be registered as long as they satisfy
the prescribed conditions. However, Law recognizes only one Trade Union to be Principal
Bargaining Agent or a Joint Bargaining Council which is determined according to a secret
ballot.

Cancellation of Registration

Trade Unions Act, 1926

Under section 10, the Registrar of Trade Unions has the power to cancel the registration of a
trade union in the following conditions:

1. On the application of the trade union to be verified in the prescribed manner.

2. If the registrar is satisfied that registration was obtained by fraud or mistake.

3. If the trade union has ceased to exist.

6
Recognition of Trade Unions (2011), https://labourlawkerala.wordpress.com/2011/03/19/recoginition-of-
trade-unions/ (last visited Sept. 27, 2016).
4. If the trade union willfully, upon notice of the registrar, has contravened or allowed any
rule to continue in force, which is inconsistent with the provisions of this act.

5. If the trade union rescinds any rule providing for any matter, provision for which is
required to be made in section 6.

6. If the registrar is satisfied that a trade union of workmen has ceased to have the requisite
number of members.

Under section 27, upon dissolution of a trade union, seven or more members must send a
notification to the registrar within 14 days of dissolution and the registrar shall register ir
after verifying that the dissolution has been done as per the provisions of this act. Further, if
the rules of the trade union do not provide for distribution of the funds upon dissolution, the
registrar may distribute the funds in such manner as may be prescribed.

Kerala Recognition of Trade Unions Act, 2010

S 6 of the Act deals with withdrawal or cancellation of certificate for recognition. If the
Registrar is satisfied that the certificate has been obtained by fraud or misrepresentation or
that the Trade Union has ceased to exist or the Trade Union has lost the requisite percentage
of membership or has violated any of the provisions of the Act, the certificate shall be
withdrawn. The Act mandates a notice period of not less than 30 days' notice in writing
specifying the ground on which it is proposed to withdraw or cancel the certificate and an
opportunity of being heard.

Both the provisions provide for similar conditions for withdrawal of certificates.

Rights, Liabilities and Immunities provided under the Act:

Trade Unions Act, 1926

Rights

As per section 13, upon registration, a trade union becomes a legal entity and as a
consequence, it gets perpetual succession and a corporate seal, it can acquire and hold
movable and immovable property, contract through agents, and can sue and get sued.

Under section 15 a registered trade union has a right to establish a general fund.
Under section 16, a registered trade union has a right to establish a political fund.
Subscription to this fund is not necessary for a member.

Under section 17, 18, and 19 a registered trade union gets immunity in certain criminal, civil,
and contractual proceedings.

Under section 24, trade unions have the right to amalgamate.

Under section 28-F, the executive of a registered trade union has a right to negotiate with the
employer the matters of employment or non-employment or the terms of employment or the
condition of labor of all or any of the members of the trade union and the employer shall
receive and send replies to letters and grant interviews to such body regarding such matters. It
further provides that the executive is entitled to post notices of the trade union meant for its
members at any premises where they are employed and that the employer shall provide
reasonable facilities for that.

Immunities

Section 17 confers immunity from liability in the case of criminal conspiracy under section
120-B of IPC, committed by an office bearer or a member. However, this immunity is partial
in the sense that it is available only with respect to the legal agreements created by the
members for the furtherance of valid objects of a trade union as described in section 15 of the
act. The immunity cannot be claimed for an act that is an offence. Registered Trade Unions
have certain rights to do in furtherance of their trade disputes such as calling for strike,
persuading members.

In the case of West India Steel Company Ltd. v Azeez, a trade union leader obstructed work
inside the factory for 5 hrs while protesting against the deputation of a workman to work
another section. It was held that while in a factory, the worker must submit to the instructions
given by his superiors. A trade union leader has no immunity against disobeying the orders.
A trade union leader or any worker does not have any right by law to share managerial
responsibilities. A trade union can espouse the cause of workers through legal ways but
officials of a trade union cannot direct other workers individually or in general about how to
do their work. They do not have the right to ask a worker to stop his work or otherwise
obstruct the work of the establishment. An employer may deal with a person causing
obstruction in work effectively.
Section 18 confers immunity from civil proceedings in certain cases to a trade union or its
office bears or members. In general, a person is liable in torts for inducing another person to
breach his contract of employment or for interfering with the trade or business of another.
However, a trade union, its officers, and its members are immune from this liability provided
that such an inducement is in contemplation or furtherance of a trade dispute. Further, the
inducement should be lawful. There is no immunity against violence, threats, or any other
illegal means.

In the case of P Mukundan and others v Mohan Kandy Pavithran, it was held that strike per
se is not an actionable wrong. Further, it was held that the trade union, its officers, and its
members are immune against legal proceedings linked with the strike of workmen by the
provisions of section 18. In the leading case of Rohtas Industries Staff Union v State of
Bihar (1963), it was held that employers do not have the right to claim damages against the
employee participating in an illegal strike and thereby causing loss of production and
business.
In the case of Simpson & Group Companies Workers & Staff Union v Amco Batteries Ltd
(1992), it was held that physical obstruction of movement of management officials,
contractors, goods, or vehicles carrying raw materials, is not a trade union right or a
fundamental right under art 19. Immunity under section 18 cannot be claimed for such
activities. Right to picket is a very intangible right and it extends only up to the right of free
movement of others. The methods of persuasion are limited to oral and visual and do not
include physical obstruction of vehicles or persons.

Section 19 Enforceability of agreements - In India, an agreement in restraint of trade is void

as per section 25 of Indian Contract Act. However, such an agreement between trade union
members is neither void nor voidable. It is important to note that this right is available only to
registered trade unions. An unregistered trade union must follow the principles of general
contract law.

Liabilities

A registered trade union must follow the provisions of the Trade Unions Act 1926. In
particular, the following are some restrictions in a registered trade union:

A Trade Union cannot spend the funds on anything the office bearers want. It can spend
funds only on the activities specified in Section 15. These include:
  salaries of the office bearers.
 expenses required for the administration of the trade union
 compensation to workers due to loss arise of any trade dispute.
 welfare activities of the workers including housing, clothing, or any such activity.
 benefits to the workers or their dependents in the case of unemployment, disability, or
death.
 publishing material for creating awareness in the workers.
 legal expenses required for defending or bringing a suit.
 education of workers or their dependents.
 expenses for medical treatment of workers.
 taking insurance policies for workers.

A trade union cannot force members to subscribe to political fund under section 16.

Under section 20, a trade union must make available all its record books of accounts and list
of membership for inspection upon request of any member or his representative.

Section 21 allows minors more than 15 yrs of age to be members of a trade union. However,
such minors cannot hold office.

Under section 21-A, a trade union cannot appoint a person who has been convicted of a crime
involving moral turpitude and has been imprisoned for 6 months or more within last 5 years.

As per section 22, at least half of the office bearers of a trade union of workers of
unorganized sector must be engaged or employed in an industry to which the trade union is
connected. Also, while a union has a right to remove any office bearer, this power must be
used judiciously and rules of natural justice must be followed.

Under section 28, a general statement, audited in a prescribed manner, of all income and
expenses must be sent to the registrar every year.

Kerala Recognition of Trade Unions Act, 2010

Section 10 of the Act confers the following rights on the recognised Trade Union:

 to raise issue and enter into collective agreement with the employer or employers on
general questions concerning employment or non-employment or terms of
employment and conditions of labour or any workmen in respect of the industrial
 establishment or class of industry in a local area, as the case may be, for which it is
recognised
 to collect membership fee, subscriptions or any other dues payable by members of
the Trade Union within the premises of the industrial establishment in such manner
as may be prescribed
 to put up or to cause to be put up a notice board on the premises of the industrial
establishment in respect of which it is recognised and affix or cause to be affixed
thereon notices relating to meetings, statements of accounts of its income and
expenditure and other announcements which are not abusive, indecent or contrary to
discipline or otherwise against the provisions of any law for the time being in force
 for the purpose of prevention or settlement of any dispute regarding issues specified
in clause (a),—
(i) to hold discussions with the workmen who are members of the Trade Union at a
suitable place or places within the premises of the industrial establishment with the
consent of the employer;
(ii) to meet and discuss with the employer or any person appointed by him for the
purpose;
 to nominate its representatives on non-statutory bipartite committees like Production
Committee, Welfare Committee, House Allotment Committee that might be set up by
any employer in an industrial establishment.

S 14 requires every employer to give protection for lawful union activity and such other
reasonable opportunity including leave for attending negotiations or conciliations to
representatives of sole bargaining agent or principal bargaining agent or joint bargaining
council members.

The State legislation does not grant any immunities or liabilities. Additionally, the rights
granted on the recognised trade union is intended to enable them to represent the issues of the
workmen and other trade unions. However, trade Union under this Act is defined as a Trade
Union registered under the Trade Unions Act. Therefore, the recognised trade Union will also
enjoy all immunities, rights and liabilities conferred under trade Unions Act.

Penalties
The Trade Unions Act, 1926

The Act has created the following offences:

S. 31 makes failure to submit returns punishable with fine which may extend to five rupees
and in case of continuing default, five rupees for each week, the aggregate fine not exceeding
fifty rupees. Further S. 31(2) punishes persons who wilfully make false entries or omissions
from the general statement required under S. 28 or in any other forms with a fine of five
hundred rupees.

Further under S. 32, supplying false information regarding trade unions to any member of a
registered trade union or to any person intending to become a member of such trade union is
punishable with fine which may extend to two hundred rupees.

Kerala Recognition of Trade Unions Act, 2010

S.12 of the Act punishes failure to submit returns with a fine which may extend to five rupees
and five rupees each week for a continuing offence, the aggregate fine not exceeding fifty
rupees.

If an employer fails or refuses to grant a recognition, he is punishable with a fine of 5000 Rs

or imprisonment for 6 months. (Section 13)

Thus, in this Act, penalty also includes imprisonment.

Conclusion
Thus it can be see that both legislations have been enacted for completely different objective
that is, recognition and registration respectively. Therefore, the rights, liabilities and
privileges conferred under them also vary to a great extent.